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Item 1A. Risk Factors

2021-03-25 compared with 2020-02-03 · 215 added, 671 removed, 195 unchanged (82% of the section changed)

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for investors and securities analysts to evaluate our business and prospects.

You must consider our prospects in light

of the risks, expenses and difficulties we face as an early stage company with a limited operating history.

should evaluate an investment in our securities in light of the uncertainties encountered by early stage companies in an intensely

competitive industry.

There can be no assurance that our efforts will be successful or that we will be able to become

You must consider our prospects in light of the

risks, expenses and difficulties we face as an early stage company with a limited operating history.

Investors should evaluate

an investment in our securities in light of the uncertainties encountered by early stage companies in an intensely competitive

There can be no assurance that our efforts will be successful or that we will be able to become profitable.

cancer treatment business is pre-revenue, pre-development and subject to the risks of an early stage biotechnology company.

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inherent in a new business, in particular new businesses engaged in the early detection of certain cancers.

in its early stages of development, and we still must establish and implement many important functions necessary to commercialize

the biotechnology.

DHA-dFdC is in its

early stages of development, and we still must establish and implement many important functions necessary to commercialize the

biotechnology.

you should consider the Company’s prospects in light of the costs, uncertainties, delays and difficulties frequently encountered

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should consider that there is a significant risk that we will not be able to:

● demonstrate

the effectiveness of DHA-dFdC;

or execute our current business plan, or that our current business plan is sound;

sufficient funds in the capital markets or otherwise to fully effectuate our business

our management team, including the members of our scientific advisory board;

sufficient funds in the capital markets or otherwise to fully effectuate our business plan;

our management team;

the required clinical studies;

that the processes and technologies that we have developed or will develop are commercially

enter into or maintain contracts with potential commercial partners such as licensors

of technology and suppliers.

that the processes and technologies that we have developed or will develop are commercially viable;

enter into or maintain contracts with potential commercial partners such as licensors of technology and suppliers.

of the foregoing risks may adversely affect the Company and result in the failure of our business.

In addition, we expect

to encounter unforeseen expenses, difficulties, complications, delays and other known and unknown factors.

At some point, we will

need to transition from a company with a research and development focus to a company capable of supporting commercial activities.

We may not be able to reach such achievements, which would have a material adverse effect on our Company.

In addition, we expect to encounter

unforeseen expenses, difficulties, complications, delays and other known and unknown factors.

At some point, we will need to transition

from a company with a research and development focus to a company capable of supporting commercial activities.

We may not be able

to reach such achievements, which would have a material adverse effect on our Company.

continue to incur operating losses and may not achieve profitability.

loss from operations for the years ended December 31, 2019 and 2018 was $5.7 million and $6.9 million, respectively.

for the year ended December 31, 2019 was $4.2 million and our net income for the year ended December 31, 2018 was $2.0 million.

Our accumulated deficit was $144.3 million at December 31, 2019.

We recognized $9,000 and $28,000 in revenue in 2019 and 2018,

respectively.

Our ability to become profitable depends upon our ability to generate revenue from biotechnology products.

not know when, or if, we will generate any revenue from such biotechnology products.

Even though our revenue may increase, we

expect to incur significant additional losses while we grow and expand our business.

We cannot predict if and when we will achieve

profitability.

Our failure to achieve and sustain profitability could negatively impact the market price of our common stock.

expect to need additional capital to fund our growing operations and if we are unable to obtain sufficient capital, we may be

forced to limit the scope of our operations.

expect that for our business to grow we will need additional working capital.

If adequate additional debt and/or equity

financing is not available on reasonable terms or at all, we may not be able to continue to expand our business or pay our outstanding

obligations, and we will have to modify our business plans accordingly.

These factors would have a material adverse

effect on our future operating results and our financial condition.

we reach a point where we are unable to raise needed additional funds to continue as a going concern, we will be forced to cease

our activities and dissolve the Company.

In such an event, we will need to satisfy various creditors and other claimants,

severance, lease termination and other dissolution-related obligations and we may not have sufficient funds to pay to our stockholders.

have experienced losses from operations since our inception.

Our ability to become profitable depends upon our ability to generate

revenue from biotechnology products.

We do not know when, or if, we will generate any revenue from such biotechnology products.

Even though our revenue may increase, we expect to incur significant additional losses while we grow and expand our business.

We cannot predict if and when we will achieve profitability.

Our failure to achieve and sustain profitability could negatively

impact the market price of our common stock.

we fail to maintain an effective system of internal controls over financial reporting, we may not be able to accurately report

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Any inability to provide reliable financial reports or to prevent fraud could harm our business.

The Sarbanes-Oxley

Act of 2002 requires management to evaluate and assess the effectiveness of our internal control over financial reporting.

order to continue to comply with the requirements of the Sarbanes-Oxley Act, we are required to continuously evaluate and, where

appropriate, enhance our policies, procedures and internal controls.

If we fail to maintain the adequacy of our internal

controls over financial reporting, we could be subject to litigation or regulatory scrutiny and investors could lose confidence

in the accuracy and completeness of our financial reports.

We cannot assure you that in the future we will be able to fully

comply with the requirements of the Sarbanes-Oxley Act or that management will conclude that our internal control over financial

reporting is effective.

If we fail to fully comply with the requirements of the Sarbanes-Oxley Act, our business may be harmed

and our stock price may decline.

The Sarbanes-Oxley Act

of 2002 requires management to evaluate and assess the effectiveness of our internal control over financial reporting.

to continue to comply with the requirements of the Sarbanes-Oxley Act, we are required to continuously evaluate and, where appropriate,

enhance our policies, procedures and internal controls.

If we fail to maintain the adequacy of our internal controls over financial

reporting, we could be subject to litigation or regulatory scrutiny and investors could lose confidence in the accuracy and completeness

of our financial reports.

We cannot assure you that in the future we will be able to fully comply with the requirements of the

Sarbanes-Oxley Act or that management will conclude that our internal control over financial reporting is effective.

to fully comply with the requirements of the Sarbanes-Oxley Act, our business may be harmed and our stock price may decline.

assessment, testing and evaluation of the design and operating effectiveness of our internal control over financial reporting

resulted in our conclusion that, as of December 31, 2019, our internal control over financial reporting was not effective,

due to our lack of segregation of duties, and lack of controls in place to ensure that all material transactions and developments

resulted in our conclusion that, as of December 31, 2020, our internal control over financial reporting was not effective, due

to our lack of segregation of duties, and lack of controls in place to ensure that all material transactions and developments

impacting the financial statements are reflected.

We can provide no assurance as to conclusions of management with respect

to the effectiveness of our internal control over financial reporting in the future.

independent auditors have expressed substantial doubt about our ability to continue as a going concern.

to our net losses, negative cash flow and negative working capital, in their report on our audited financial statements for the

years ended December 31, 2019 and 2018, our independent auditors included an explanatory paragraph regarding substantial doubt

about our ability to continue as a going concern.

We can provide no assurance as to conclusions of management with respect to

the effectiveness of our internal control over financial reporting in the future.

may seek to internally develop additional new inventions and intellectual property, which would take time and be costly.

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of our business may include the internal development of new inventions or intellectual property that we will seek to monetize.

example, in December 2019, we acquired substantially all of the assets of CBM, including the acquisition of certain licensing

For example, in December 2019, we acquired substantially all of the assets of CBM, including the acquisition of certain licensing

rights with respect to patents and other intellectual property related to pioneering drug compounds that were developed at the

University of Wake Forest and the University of Texas at Austin, in the areas of acute myeloid leukemia (AML), acute lymphoblastic

leukemia (ALL), acral lentiginous melanoma and pancreatic cancer (collectively, the “University Developments”).

we choose to assist in the development of the University Developments and/or internally develop any other inventions or intellectual

property, such aspect of our business will require significant capital and will take time to achieve.

Such activities

may also distract our management team from its present business initiatives, which could have a material and adverse effect on

our business.

There is also the risk that our initiatives in this regard would not yield any viable new inventions or technology,

which would lead to a loss of our investments in time and resources in such activities.

ability to raise additional capital may be adversely affected by certain of our agreements.

ability to raise additional capital for use in our operating activities may be adversely impacted by the terms of a securities

purchase agreement, dated as of July 15, 2015 (the “Securities Purchase Agreement”), between us and the investors

who purchased securities in our July 2015 offering of our common stock and warrants for the purchase of our common stock.

Securities Purchase Agreement provides that, until the warrants issued thereunder are no longer outstanding, we will not effect

or enter into a variable rate transaction, which includes issuances of securities whose prices or conversion prices may vary with

the trading prices of or quotations for the shares of our common Stock at any time after the initial issuance of such securities,

as well as the entry into agreements where our stock would be issued at a future-determined price.

These warrants may remain outstanding

as late as January 22, 2021, when the warrants expire in accordance with their terms.

These restrictions may have an adverse impact

on our ability to raise additional capital, or to use our cash to make certain payments that we are contractually obligated to

may also identify targets with patent or other intellectual property assets that cost more than we are prepared to spend with

our own capital resources.

We may incur significant costs to organize and negotiate a structured acquisition that does

not ultimately result in an acquisition of any patent assets or, if consummated, proves to be unprofitable for us.

involving issuance of our securities could be dilutive to existing stockholders and could be at prices lower than those prices

reflected in the trading markets.

These higher costs could adversely affect our operating results and, if we incur

losses, the value of our securities will decline.

The integration of acquired assets may place a significant burden on management

and our internal resources.

The diversion of management attention and any difficulties encountered in the integration

process could harm our business.

we are targeting technology companies in the development stage, their patents and technologies are in the early stages of adoption.

for some of these technologies will likely be untested and may be subject to fluctuation based upon the rate at which our licensees

or others adopt our patents and technologies in their products and services.

As a result, there can be no assurance

as to whether technologies we acquire or develop will have value that can be realized through licensing or other activities.

University of Wake Forest and the University of Texas at Austin, in the areas of AML, ALL, acral lentiginous melanoma and pancreatic

cancer (collectively, the “University Developments”).

Should we choose to assist in the development of the University

Developments and/or internally develop any other inventions or intellectual property, such aspect of our business will require

significant capital and will take time to achieve.

Such activities may also distract our management team from its present business

initiatives, which could have a material and adverse effect on our business.

There is also the risk that our initiatives in this

regard would not yield any viable new inventions or technology, which would lead to a loss of our investments in time and resources

in such activities.

are exploring and evaluating strategic alternatives and there can be no assurance that we will be successful in identifying, or

completing any strategic alternative or that any such strategic alternative will yield additional value for shareholders.

management and Board of Directors has commenced a review of strategic alternatives which could result in, among other things,

a sale, a merger, consolidation or business combination, asset divestiture, partnering or other collaboration agreements, or potential

acquisitions or recapitalizations, in one or more transactions, or continuing to operate with our current business plan and strategy.

There can be no assurance that the exploration of strategic alternatives will result in the identification or consummation of

any transaction.

In addition, we may incur substantial expenses associated with identifying and evaluating potential strategic

alternatives.

The process of exploring strategic alternatives may be time consuming and disruptive to our business operations

and if we are unable to effectively manage the process, our business, financial condition and results of operations could be adversely

We also cannot assure you that any potential transaction or other strategic alternative, if identified, evaluated and

consummated, will provide greater value to our shareholders than that reflected in the current stock price.

Any potential transaction

would be dependent upon a number of factors that may be beyond our control, including, among other factors, market conditions,

industry trends, the interest of third parties in our business and the availability of financing to potential buyers on reasonable

may be unsuccessful at integrating future acquisitions.

we find appropriate opportunities in the future, we may acquire businesses to strategically increase the number of patents in

our portfolio and pursue monetization.

For example, in December 2019, we acquired substantially all of the assets of CBM, including

the acquisition of certain licensing rights with respect to patents and other intellectual property related to pioneering drug

compounds that were developed at the University of Wake Forest and the University of Texas at Austin, in the areas of acute myeloid

leukemia (AML), acute lymphoblastic leukemia (ALL), acral lentiginous melanoma and pancreatic cancer.

There can be no guarantee

that we will be able to successfully

integrate the business or assets of CBM into the Company.

we acquire businesses or substantial stakes in certain businesses, the process of integration may produce unforeseen operating

difficulties and expenditures, fail to result in expected synergies or other benefits and absorb significant attention of our

management that would otherwise be available for the ongoing development of our business.

In addition, in the event of any future

acquisitions, we may record a portion of the assets we acquire as goodwill, other indefinite-lived intangible assets or finite-lived

intangible assets.

We do not amortize goodwill and indefinite-lived intangible assets, but rather review them for impairment on

an annual basis or whenever events or changes in circumstances indicate that their carrying value may not be recoverable.

recoverability of goodwill and indefinite-lived intangible assets is dependent on our ability to generate sufficient future earnings

and cash flows.

Changes in estimates, circumstances or conditions, resulting from both internal and external factors, could have

a significant impact on our fair valuation determination, which could then have a material adverse effect on our business, financial

condition and results of operations.

We cannot guarantee that we will be able to identify suitable acquisition opportunities,

consummate any pending or future acquisitions or that we will realize any anticipated benefits from any such acquisitions.

pre-acquisition stockholders have a reduced ownership and voting interest after the acquisition of CBM’s assets and exercise

less influence over our management and policies than they did prior to the acquisition.

pre-acquisition stockholders had the right to vote in the election of our Board of Directors on other matters affecting us.

a result of the CBM Purchase Agreement, because of the issuance of shares of common stock to the CBM shareholders, our pre-acquisition

stockholders hold a percentage ownership of the Company that is much smaller than the pre-acquisition stockholder’s previous

percentage ownership.

Because of this, our pre-acquisition stockholders have less influence over the management and policies of

the Company than they now have after the consummation of the acquisition of CBM’s assets.

failure to maintain or protect our patent assets or other intellectual property rights could significantly impair our return on

investment from such assets and harm our brand, our business and our operating results.

ability to operate our new line of business and compete in the intellectual property market largely depends on the superiority,

uniqueness and value of our acquired patent assets and other intellectual property.

To protect our proprietary rights,

we will rely on a combination of patent, trademark, copyright and trade secret laws, confidentiality agreements with our employees

and third parties, and protective contractual provisions.

No assurances can be given that any of the measures we undertake

to protect and maintain our assets will have any measure of success.

are required to spend significant time and resources to maintain the effectiveness of our assets by paying maintenance fees and

making filings with the USPTO.

We may acquire patent assets, including patent applications, which require us to spend

resources to prosecute the applications with the USPTO prior to issuance of patents.

Further, there is a material risk

that patent related claims (such as, for example, infringement claims (and/or claims for indemnification resulting therefrom),

unenforceability claims, or invalidity claims) will be asserted or prosecuted against us, and such assertions or prosecutions

could materially and adversely affect our business.

our efforts to protect our intellectual property rights, any of the following or similar occurrences may reduce the value of our

intellectual property:

applications for patents, trademarks and copyrights may not be granted and, if granted, may be challenged or invalidated;

trademarks, copyrights, or patents may not provide us with any competitive advantages when compared to potentially infringing

other properties;

efforts to protect our intellectual property rights may not be effective in preventing misappropriation of our technology;

efforts may not prevent the development and design by others of products or technologies similar to or competitive with, or

superior to those we acquire and/or prosecute.

we may not be able to effectively protect our intellectual property rights in certain foreign countries where we may do business

or enforce our patents against infringers in foreign countries.

If we fail to maintain, defend or prosecute our patent assets

properly, the value of those assets would be reduced or eliminated, and our business would be harmed.

may be unable to issue securities under our shelf registration statement, which may have an adverse effect on our liquidity.

have filed a shelf registration statement on Form S-3 with the SEC.

The registration statement, which has been declared

effective, was filed in reliance on Instruction I.B.6.

of Form S-3, which imposes a limitation on the maximum amount of securities

that we may sell pursuant to the registration statement during any twelve-month period.

At the time we sell securities

pursuant to the registration statement, the amount of securities to be sold plus the amount of any securities we have sold during

the prior twelve months in reliance on Instruction I.B.6.

may not exceed one-third of the aggregate market value of our outstanding

common stock held by non-affiliates as of a day during the 60 days immediately preceding such sale as computed in accordance with

Instruction I.B.6.

Whether we sell securities under the registration statement will depend on a number of factors, including

availability of our existing S-3 under the 1/3 limitation calculations set forth in Instruction I.B.6 of Form S-3, the market

conditions at that time, our cash position at that time and the availability and terms of alternative sources of capital.

Instruction I.B.6.

of Form S-3 requires that the issuer have at least one class of common equity securities listed and registered

on a national securities exchange.

If we are not able to maintain compliance with applicable NASDAQ rules, we will no longer be

able to rely upon that Instruction.

If we cannot sell securities under our shelf registration, we may be required to utilize more

costly and time-consuming means of accessing the capital markets, which could materially adversely affect our liquidity and cash

management and Board of Directors (“Board of Directors”) has commenced a review of strategic alternatives which could

result in, among other things, a sale, a merger, consolidation or business combination, asset divestiture, partnering or other

collaboration agreements, or potential acquisitions or recapitalizations, in one or more transactions, or continuing to operate

with our current business plan and strategy.

There can be no assurance that the exploration of strategic alternatives will result

in the identification or consummation of any transaction.

In addition, we may incur substantial expenses associated with identifying

and evaluating potential strategic alternatives.

The process of exploring strategic alternatives may be time consuming and disruptive

to our business operations and if we are unable to effectively manage the process, our business, financial condition and results

of operations could be adversely affected.

We also cannot assure you that any potential transaction or other strategic alternative,

if identified, evaluated and consummated, will provide greater value to our shareholders than that reflected in the current stock

Any potential transaction would be dependent upon a number of factors that may be beyond our control, including, among

other factors, market conditions, industry trends, the interest of third parties in our business and the availability of financing

to potential buyers on reasonable terms.

may be at risk for delay in technology development and other economic repercussions as a result of the COVID-19 pandemic.

may be at risk as a result of the current COVID-19 pandemic.

Risks that could affect our business include the duration and scope

of the COVID-19 pandemic and the impact on the demand for our products;

actions by governments, businesses and individuals taken

in response to the pandemic;

the length of time of the COVID-19 pandemic and the possibility of its reoccurrence;

the timing required

to develop effective treatments and a vaccine in the event of future outbreaks;

the eventual impact of the pandemic and actions

taken in response to the pandemic on global and regional economies;

and the pace of recovery when the COVID-19 pandemic subsides.

York, where our U.S.

operations are based, has been significantly affected by COVID-19, which led to measures taken by the New

York government trying to contain the spread of COVID-19, such as shelter in place, closure of schools and travel restrictions.

Additional travel and other restrictions may be put in place to further control the outbreak in U.S.

Accordingly, our operation

and business have been and will continue to be adversely affected as the results of the COVID-19 pandemic.

Additionally, for our

pipeline products, DHA-dFdC was delayed due to COVID-19 because our manufacturer was recruited by the U.S.

and South Carolina

governments to manufacture hand sanitizer for use in hospitals.

For that reason, our manufacturing activities did not begin in

earnest until the beginning of the third quarter of 2020.

Once manufacturing began, shipping delays due to the pandemic further

slowed progress.

Despite these delays, we have now successfully replicated the synthesis as reported in the literature with satisfactory

yield and purity and are currently optimizing the procedure to ensure batch-to-batch consistency.

We expect to have manufactured

20,000 mg of purified DHA-dFdC during the second quarter of 2021 to use for formulation development.

For the UMB compounds discussed,

UMB was closed at the beginning of the pandemic and the researchers were unable to further their studies.

UMB has since reopened

and the researchers have commenced working on the compounds again.

extent to which COVID-19 negatively impacts our business is highly uncertain and cannot be accurately predicted.

We believe that

the coronavirus outbreak and the measures taken to control it may have a significant negative impact on not only our business,

but economic activities globally.

The magnitude of this negative effect on the continuity of our business operations in the U.S.

remains uncertain.

These uncertainties impede our ability to conduct our daily operations and could materially and adversely affect

our business, financial condition and results of operations, and as a result affect our stock price and create more volatility.

Related to the Product Development, Regulatory Approval, Manufacturing and Commercialization

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If we are unable to clinically develop

and ultimately commercialize DHA-dFdC or other product candidates, or experience significant delays in doing so, our business

will be materially harmed.

and ultimately commercialize DHA-dFdC, antiviral compounds or other product candidates, or experience significant delays in doing

so, our business will be materially harmed.

are early in our development efforts and have no clinical-stage product candidates as of the date of this prospectus.

the exclusive U.S.

we have the exclusive U.S.

rights to develop DHA-dFdC for the treatment of cancer in the licensed field.

We are presently planning on

filing an IND for DHA-dFdC, and we hope to begin human testing for this indication in 2021, although no assurance can be given

We are presently planning

on filing an IND for DHA-dFdC, and we hope to begin human testing for this indication in 2022, although no assurance can be given

that we will be able to achieve this goal.

We also have rights to assist in the development of various antiviral compounds with

our ability to generate product or royalty revenues, which we do not expect will occur for several years, if ever, will depend

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we do not achieve one or more of these factors in a timely manner or at all, we could experience significant delays or an inability

to clinically develop and commercialize DHA-dFdC as a therapy for cancer, which would materially harm our business.

we are unable to convince physicians as to the benefits of DHA-dFdC as a therapy for cancer, if and when it is approved, we may

incur delays or additional expense in our attempt to establish market acceptance.

of DHA-dFdC as a cancer therapy will require physicians to be informed regarding the intended benefits of the product for a new

The time and cost of such an educational process may be substantial.

Inability to carry out this physician education

process may adversely affect market acceptance of DHA-dFdC as a therapy for cancer.

We may be unable to timely educate physicians

in sufficient numbers regarding our intended application of DHA-dFdC to achieve our marketing plans or to achieve product acceptance.

Any delay in physician education or acceptance may materially delay or reduce demand for our product candidate.

In addition, we

may expend significant funds toward physician education before any acceptance or demand for DHA-dFdC as a therapy for cancer is

created, if at all.

to clinically develop and commercialize DHA-dFdC as a therapy for cancer and at least one of the UMB lead compounds as an antiviral

therapy, which would materially harm our business.

drug development involves a lengthy and expensive process, with an uncertain outcome.

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risk of failure for product candidates in clinical development is high.

It is impossible to predict when our sole product candidate,

DHA-dFdC for the treatment of cancer, will prove effective and safe in humans or will receive regulatory approval for the treatment

of any disease, the indication for which is licensed to us.

Before obtaining marketing approval from regulatory authorities for

the sale of DHA-dFdC as a cancer therapy, we must conduct one or more clinical trials to demonstrate the safety and efficacy of

our product candidate in humans.

Clinical testing is expensive, difficult to design and implement, can take many years to complete

and is uncertain as to outcome.

A failure of one or more clinical trials can occur at any stage of testing.

Moreover, the outcome

of early clinical trials may not be predictive of the success of later clinical trials, and interim results of a clinical trial

do not necessarily predict final results.

In addition, preclinical and clinical data are often susceptible to varying interpretations

and analyses, and many companies that have believed their product candidates performed satisfactorily in clinical trials have

nonetheless failed to obtain marketing approval of their products.

It is impossible to predict when our product candidates,

including DHA-dFdC and any of the lead UMB compounds, will prove effective and safe in humans or will receive regulatory approval

for the treatment of any disease, the indication for which is licensed to us.

Before obtaining marketing approval from regulatory

authorities for the sale of DHA-dFdC as a cancer therapy or one or more of the lead UMB compounds as antiviral therapy, we must

conduct one or more clinical trials to demonstrate the safety and efficacy of each product candidate in humans.

Clinical testing

is expensive, difficult to design and implement, can take many years to complete and is uncertain as to outcome.

one or more clinical trials can occur at any stage of testing.

Moreover, the outcome of early clinical trials may not be predictive

of the success of later clinical trials, and interim results of a clinical trial do not necessarily predict final results.

addition, preclinical and clinical data are often susceptible to varying interpretations and analyses, and many companies that

have believed their product candidates performed satisfactorily in clinical trials have nonetheless failed to obtain marketing

approval of their products.

may experience numerous unforeseen events during, or as a result of, clinical trials that could delay or prevent our ability to

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and may harm our business and results of operations.

we experience delays or difficulties in the enrollment of patients in any future clinical trials, our receipt of necessary regulatory

approvals could be delayed or prevented.

may not be able to initiate or continue future clinical trials for DHA-dFdC or our present or future product candidates if we

are unable to locate and enroll a sufficient number of eligible patients to participate in these trials as required by the U.S.

Food and Drug Administration (“FDA”) or similar regulatory authorities outside the United States.

In addition, some

of our competitors have ongoing clinical trials for product candidates that treat the same indications as our product candidate,

and patients who would otherwise be eligible for our future clinical trials may instead enroll in clinical trials of our competitors’

product candidates.

enrollment is affected by other factors including:

severity of the disease under investigation;

eligibility criteria for the study in question;

perceived risks and benefits of the product candidate under study;

patient referral practices of physicians;

ability to monitor patients adequately during and after treatment;

proximity and availability of clinical trial sites for prospective patients.

inability to enroll a sufficient number of patients for any future clinical trials would result in significant delays and could

require us to abandon one or more clinical trials altogether.

Enrollment delays in our clinical trials may result in increased

development costs for our product candidate, which would cause the value of our company to decline and otherwise materially and

adversely affect our company.

serious adverse or unacceptable side effects are identified during the development of our product candidate, we may need to abandon

or limit such development, which would adversely affect our company.

clinical testing of our product candidates results in undesirable side effects or demonstrates characteristics that are unexpected,

we may need to abandon such development or limit such development to more narrow uses or subpopulations in which the undesirable

side effects or other characteristics are less prevalent, less severe or more acceptable from a risk-benefit perspective.

compounds that initially showed promise in early stage testing for treating cancer have later been found to cause side effects

that prevented further development of the compound.

the foreseeable future, we expect to expend our limited resources primarily to pursue a particular product candidate, leaving

us unable to capitalize on other product candidates or indications that may be more profitable or for which there is a greater

likelihood of clinical and commercial development.

we have limited financial and managerial resources, we will focus for the foreseeable future primarily on the clinical development

of DHA-dFdC for the treatment of prostate cancer.

As a result, we may forego or be unable to pursue opportunities with other product

candidates or for indications other than those we intend to pursue that later prove to have greater commercial potential.

resource allocation decisions may cause us to fail to capitalize on viable commercial products or profitable market opportunities.

Our spending on research and development programs related to DHA-dFdC for the treatment of cancer may not yield any commercially

viable therapies.

Because of this concentration of our efforts, our business will be particularly subject to significant risk

of failure of our one current product candidate.

expect to rely on collaborations with third parties for key aspects of our business.

If we are unable to secure or maintain any

of these collaborations, or if these collaborations do not achieve their goals, our business would be adversely affected.

presently have very limited capabilities for drug development and do not yet have any capability for manufacturing, sales, marketing

or distribution.

Accordingly, we expect to enter into collaborations with other companies that we believe can provide such capabilities.

These collaborations may also provide us with important funding for our development programs.

is a risk that we may not be able to maintain our current collaboration or to enter into additional collaborations on acceptable

terms or at all, which would leave us unable to progress our business plan.

We will face significant competition in seeking appropriate

collaborators.

Our ability to reach a definitive agreement for a collaboration will depend, among other things, upon our assessment

of the collaborator’s resources and expertise, the terms and conditions of the proposed collaboration and the proposed collaborator’s

evaluation of a number of factors.

If we are unable to maintain or reach agreements with suitable collaborators on a timely basis,

on acceptable terms, or at all, we may have to curtail the development of our product candidate, reduce or delay its development

program, delay its potential commercialization or reduce the scope of any sales or marketing activities, or increase our expenditures

and undertake development or commercialization activities at our own expense.

even if we are able to maintain and/or enter into such collaborations, such collaborations may pose a number of risks, including

the following:

collaborators

may not perform their obligations as expected;

disagreements

with collaborators, including disagreements over proprietary rights, contract interpretation or the preferred course of development,

might cause delays or termination of the research, development or commercialization of our product candidate, might lead to

additional responsibilities for us with respect to such product candidate, or might result in litigation or arbitration, any

of which would be time-consuming and expensive;

collaborators

could independently develop or be associated with products that compete directly or indirectly with our product candidate;

collaborators

could have significant discretion in determining the efforts and resources that they will apply to our arrangements with them;

our product candidate achieve regulatory approval, a collaborator with marketing and distribution rights to our product candidate

may not commit sufficient resources to the marketing and distribution of such product;

collaborators

may not properly maintain or defend our intellectual property rights or may use our proprietary information in such a way

as to invite litigation that could jeopardize or invalidate our intellectual property or proprietary information or expose

us to potential litigation;

collaborators

may infringe the intellectual property rights of third parties, which may expose us to litigation and potential liability;

collaborations

may be terminated for the convenience of the collaborator and, if terminated, we could be required to either find alternative

collaborators (which we may be unable to do) or raise additional capital to pursue further development or commercialization

of our product candidate on our own.

business could be materially harmed if any of the foregoing or similar risks comes to pass with respect to our key collaborations.

if any of our product candidates receive marketing approval for any indication, they may fail to achieve the degree of market

acceptance by physicians, patients, third-party payors and others in the medical community necessary for commercial success.

if DHA-dFdC for the treatment of cancer receives marketing approval for any indication, it may nonetheless fail to gain sufficient

market acceptance by physicians, patients, third-party payors and others in the medical community.

For example, current cancer

treatments such as chemotherapy, immunotherapy and radiation therapy are well established in the medical community, and doctors

may continue to rely on these treatments.

If our product candidate does not achieve an adequate level of acceptance, we may not

generate significant product revenues and we may not become profitable.

The degree of market acceptance of DHA-dFdC for the treatment

of cancer, if approved for commercial sale, will depend on a number of factors, including:

efficacy and potential advantages compared to alternative treatments;

ability to offer our products for sale at competitive prices;

convenience and ease of administration compared to alternative treatments;

willingness of the target patient population to try new therapies and of physicians to prescribe these therapies;

strength of marketing and distribution support;

availability of third-party coverage and adequate reimbursement;

prevalence and severity of any side effects;

restrictions on the use of our product together with other medications.

we are unable to establish sales, marketing and distribution capabilities, we may not be able to commercialize our product candidate

if and when it is approved.

currently do not have a sales or marketing infrastructure.

To achieve any level of commercial success for any product for which

we have obtained marketing approval, we will need to establish a sales and marketing organization or outsource sales and marketing

functions to third parties, and achieve the following:

preparation of regulatory filings and receipt of marketing approvals from applicable regulatory authorities;

and maintaining patent and trade secret protection and potential regulatory exclusivity for our product candidate and protecting

our rights in our intellectual property portfolio;

commercial sales of our product, if and when approved for one or more indications, whether alone or in collaboration with

of the product for one or more indications, if and when approved, by patients, the medical community and third-party payors;

from generic substitution based upon our own or licensed intellectual property rights;

competing with other therapies;

and maintaining adequate reimbursement from healthcare payors;

maintaining a continued acceptable safety

profile of our product following approval, if any.

we do not achieve one or more of these factors in a timely manner or at all, we could experience significant delays or an inability

to clinically develop and commercialize DHA-dFdC as a therapy for cancer, which would materially harm our business.

addition, given our current limited financial resources, we are currently focusing our efforts on one key cancer indication, namely

prostate cancer.

We are thus faced with the risk that DHA-dFdC could be ineffective in addressing this particular cancer indication,

and if our efforts to demonstrate the efficacy of DHA-dFdC in prostate cancer are not positive, we may lack the resources to expand

our efforts into other cancer indications.

rely on third parties to conduct our clinical trials and to assist us with pre-clinical development.

If these third parties do

not perform as contractually required or expected, we may not be able to obtain regulatory approval for or commercialize our products.

do not have the ability to independently conduct our pre-clinical and clinical trials for our product candidates, and we must

rely on third parties, such as CROs, medical institutions, clinical investigators and contract laboratories to conduct such trials.

If these third parties do not successfully carry out their contractual duties or regulatory obligations, meet expected deadlines

or need to be replaced, or if the quality or accuracy of the data they obtain is compromised due to the failure to adhere to our

clinical protocols or regulatory requirements or for other reasons, our pre-clinical development activities or clinical trials

may be extended, delayed, suspended or terminated, and we may not be able to obtain regulatory approval for, or successfully commercialize,

our products on a timely basis, if at all.

Furthermore, our third-party clinical trial investigators may be delayed in conducting

our clinical trials for reasons outside of their control.

The occurrence of any of the foregoing may adversely affect our business,

operating results and prospects.

face substantial competition, which may result in others discovering, developing or commercializing products before or more successfully

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for, our programs, and we may be unable to effectively compete with these companies for these or other reasons.-

if we are able to commercialize any product candidates, the products may become subject to unfavorable pricing regulations, third-party

reimbursement practices or healthcare reform initiatives, which would harm our business.

regulations that govern marketing approvals, pricing, coverage and reimbursement for new drug products vary widely from country

Current and future legislation may significantly change the approval requirements in ways that could involve additional

costs and cause delays in obtaining approvals.

ability to commercialize any product candidate also will depend in part on the extent to which coverage and adequate reimbursement

for our product candidate will be available from government health administration authorities, private health insurers and other

organizations.

Government authorities and third party payors, such as private health insurers and health maintenance organizations,

decide which medications they will pay for and establish reimbursement levels.

A primary trend in the U.S.

healthcare industry

and elsewhere is cost containment.

Government authorities and third party payors have attempted to control costs by limiting coverage

and the amount of reimbursement for particular medications.

Increasingly, third-party payors are requiring that drug companies

provide them with predetermined discounts from list prices and are challenging the prices charged for medical products.

and reimbursement may not be available for any product that we commercialize and, even if these are available, the level of reimbursement

may not be satisfactory.

Reimbursement may affect the demand for, or the price of, any product candidate for which we obtain marketing

Obtaining and maintaining adequate reimbursement for our products may be difficult.

We may be required to conduct expensive

pharmacoeconomic studies to justify coverage and reimbursement or the level of reimbursement relative to other therapies.

and adequate reimbursement are not available or reimbursement is available only to limited levels, we may not be able to commercialize

any product candidate for which we obtain marketing approval.

addition, there may be significant delays in obtaining reimbursement for newly approved drugs, and coverage may be more limited

than the purposes for which the drug is approved by the FDA.

Moreover, eligibility for reimbursement does not imply that a drug

will be paid for in all cases or at a rate that covers our costs, including research, development, manufacture, sale and distribution.

Interim reimbursement levels for new drugs, if applicable, may also not be sufficient to cover our costs and may not be made permanent.

Reimbursement rates may vary according to the use of the drug and the clinical setting in which it is used, may be based on reimbursement

levels already set for lower cost drugs and may be incorporated into existing payments for other services.

Net prices for drugs

may be reduced by mandatory discounts or rebates required by government healthcare programs or private payors.

Third-party payors

often rely upon Medicare coverage policy and payment limitations in setting their own reimbursement policies.

Our inability to

promptly obtain coverage and adequate reimbursement rates from both government-funded and private payors for any approved products

that we develop could have a material adverse effect on our operating results, our ability to raise capital needed to commercialize

products and our overall financial condition.

liability lawsuits against us could cause us to incur substantial liabilities and to limit commercialization of any products that

we may develop.

face an inherent risk of product liability exposure related to the testing of DHA-dFdC in human clinical trials and will face

an even greater risk if we commercially sell any products that we may develop.

If we cannot defend ourselves against claims that

our product candidate or products caused injuries, we will incur substantial liabilities.

Regardless of merit or eventual outcome,

liability claims may result in:

demand for any product candidates or products that we may develop;

to our reputation and significant negative media attention;

of clinical trial participants;

costs to defend the related litigation;

monetary awards to trial participants or patients;

resources of our management to pursue our business strategy;

inability to commercialize any products that we may develop.

currently do not have product liability insurance coverage, which leaves us exposed to any product-related liabilities that we

We may be unable to obtain insurance on reasonable terms or at all.

Insurance coverage is increasingly expensive.

may not be able to maintain insurance coverage at a reasonable cost or in an amount adequate to satisfy any liability that may

we fail to comply with healthcare regulations, we could face substantial enforcement actions, including civil and criminal penalties

and our business, operations and financial condition could be adversely affected.

could be subject to healthcare fraud and abuse laws and patient privacy laws of both the federal government and the states in

which we conduct our business.

The laws include:

federal healthcare program anti-kickback law, which prohibits, among other things, persons from soliciting, receiving or providing

remuneration, directly or indirectly, to induce either the referral of an individual, for an item or service or the purchasing

or ordering of a good or service, for which payment may be made under federal healthcare programs such as the Medicare and

Medicaid programs;

false claims laws which prohibit, among other things, individuals or entities from knowingly presenting, or causing to be

presented, claims for payment from Medicare, Medicaid, or other third-party payers that are false or fraudulent, and which

may apply to entities like us which provide coding and billing information to customers;

federal Health Insurance Portability and Accountability Act of 1996, which prohibits executing a scheme to defraud any healthcare

benefit program or making false statements relating to healthcare matters and which also imposes certain requirements relating

to the privacy, security and transmission of individually identifiable health information;

FDCA which among other things, strictly regulates drug manufacturing and product marketing, prohibits manufacturers from marketing

drug products for off-label use and regulates the distribution of drug sample;

law equivalents of each of the above federal laws, such as anti-kickback and false claims laws which may apply to items or

services reimbursed by any third-party payer, including commercial insurers, and state laws governing the privacy and security

of health information in certain circumstances, many of which differ from each other in significant ways and often are not

preempted by federal laws, thus complicating compliance efforts.

our operations are found to be in violation of any of the laws described above or any governmental regulations that apply to us,

we may be subject to penalties, including civil and criminal penalties, damages, fines and the curtailment or restructuring of

our operations.

Any penalties, damages, fines, curtailment or restructuring of our operations could adversely affect our ability

to operate our business and our financial results.

Although compliance programs can mitigate the risk of investigation and prosecution

for violations of these laws, the risks cannot be entirely eliminated.

Any action against us for violation of these laws, even

if we successfully defend against it, could cause us to incur significant legal expenses and divert management’s attention

from the operation of our business.

Moreover, achieving and sustaining compliance with applicable federal and state privacy, security

and fraud laws may prove costly.

of our management team lack experience in the pharmaceutical field.

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and commercialization of pharmaceuticals products would have a material adverse effect on our business and results of operations.

marketing approval process of the FDA is lengthy, time consuming and inherently unpredictable, and if were ultimately are unable

to obtain marketing approval for the product candidates we intend to develop, our business will be substantially harmed.

of the product candidates we intend to develop have gained marketing approval in the U.S.

and we cannot guarantee that we will

ever have marketable products.

Our business is substantially dependent on our ability to complete the development of, obtain marketing

approval for, and successfully commercialize our product candidates in a timely manner.

We cannot commercialize our product candidates

in the United States without first obtaining approval from the FDA to market each product candidate.

Our product candidates could

fail to receive marketing approval for many reasons.

addition, the process of seeking regulatory clearance or approval to market the product candidates we intend to develop is expensive

and time consuming and, notwithstanding the effort and expense incurred, clearance or approval is never guaranteed.

not successful in obtaining timely clearance or approval of our product candidates from the FDA, we may never be able to generate

significant revenue and may be forced to cease operations.

The FDA process is costly, lengthy and uncertain.

Any FDA application

filed by the Company will have to be supported by extensive data, including, but not limited to, technical, preclinical, clinical

trial, manufacturing and labeling data, to demonstrate to the FDA’s satisfaction the safety and efficacy of the product

for its intended use.

clearances or approvals from the FDA and from the regulatory agencies in other countries is an expensive and time consuming process

and is uncertain as to outcome.

The FDA and other agencies could ask us to supplement our submissions, collect non-clinical data,

conduct additional clinical trials or engage in other time-consuming actions, or it could simply deny our applications.

even if we obtain an FDA approval or pre-market approvals in other countries, the approval could be revoked or other restrictions

imposed if post-market data demonstrates safety issues or lack of effectiveness.

We cannot predict with certainty how, or when,

the FDA will act.

If we are unable to obtain the necessary regulatory approvals, our financial condition and cash flow may be

adversely affected, and our ability to grow domestically and internationally may be limited.

Additionally, even if cleared or

approved, the Company’s products may not be approved for the specific indications that are most necessary or desirable for

successful commercialization or profitability.

Modifications

to our products may require new FDA approvals.

a particular product receives FDA approval or clearance, expanded uses or uses in new indications of our products may require

additional human clinical trials and new regulatory approvals or clearances, including additional IND and FDA submissions and

premarket approvals before we can begin clinical development, and/or prior to marketing and sales.

If the FDA requires new clearances

or approvals for a particular use or indication, we may be required to conduct additional clinical studies, which would require

additional expenditures and harm our operating results.

If the products are already being used for these new indications, we may

also be subject to significant enforcement actions.

Conducting clinical trials and obtaining clearances and approvals can be a

time consuming process, and delays in obtaining required future clearances or approvals could adversely affect our ability to

introduce new or enhanced products in a timely manner, which in turn would harm our future growth.

delays to the completion of clinical studies may result from modifications being made to the protocol during the clinical trial,

if such modifications are warranted and/or required by the occurrences in the given trial .

modification to the protocol during a clinical trial has to be submitted to the FDA.

This could result in the delay or halt of

a clinical trial while the modification is evaluated.

In addition, depending on the quantity and nature of the changes made, the

FDA could take the position that the data generated by the clinical trial is not poolable because the same protocol was not used

throughout the trial.

This might require the enrollment of additional subjects, which could result in the extension of the clinical

trial and the FDA delaying clearance or approval of a product.

Any such delay could have a material adverse effect on our business

and results of operations.

can be no assurance that the data generated from our clinical trials using modified protocols will be acceptable to FDA.

can be no assurance that the data generated using modified protocols will be acceptable to the FDA or that if future modifications

during the trial are necessary, that any such modifications will be acceptable to the FDA.

If the FDA believes that its prior

approval is required for a particular modification, it can delay or halt a clinical trial while it evaluates additional information

regarding the change.

injury or death resulting from a failure of one of our drug candidates during current or future clinical trials could also result

in the FDA delaying our clinical trials or denying or delaying clearance or approval of a product.

Even though an adverse event may not be the result of the failure of our drug candidate, the FDA or an Internal Review Board (“IRB”)

could delay or halt a clinical trial for an indefinite period of time while an adverse event is reviewed, and likely would do

so in the event of multiple such events.

delay or termination of our current or future clinical trials as a result of the risks summarized above, including delays in obtaining

or maintaining required approvals from IRBs, delays in patient enrollment, the failure of patients to continue to participate

in a clinical trial, and delays or termination of clinical trials as a result of protocol modifications or adverse events during

the trials, may cause an increase in costs and delays in the filing of any product submissions with the FDA, delay the approval

and commercialization of our products or result in the failure of the clinical trial, which could adversely affect our business,

operating results and prospects.

future results of our current or future clinical trials may not support our product candidate claims or may result in the discovery

of unexpected adverse side effects.

if our clinical trials are completed as planned, we cannot be certain that their results will support our drug candidate claims

or that the FDA or foreign authorities will agree with our conclusions regarding them.

Success in preclinical studies and early

clinical trials does not ensure that later clinical trials will be successful, and we cannot be sure that the later trials will

replicate the results of prior trials and preclinical studies.

The clinical trial process may fail to demonstrate that our drug

candidates are safe and effective for the proposed indicated uses.

If the FDA concludes that the clinical trials for DHA-dFdC,

or any other product for which we might seek clearance, has failed to demonstrate safety and effectiveness, we would not receive

FDA clearance to market that product in the United States for the indications sought.

addition, such an outcome could cause us to abandon the product candidate and might delay development of others.

termination of our clinical trials will delay the filing of any product submissions with the FDA and, ultimately, our ability

to commercialize our product candidates and generate revenues.

It is also possible that patients enrolled in clinical trials will

experience adverse side effects that are not currently part of the product candidate’s profile.

and future legislation may increase the difficulty and cost for us to obtain marketing approval of and commercialize our product

candidates and affect the prices we may obtain for such product candidates.

the United States and some foreign jurisdictions, there have been a number of legislative and regulatory changes and proposed

changes regarding the healthcare system that could prevent or delay marketing approval for our product candidates, restrict or

regulate post-approval activities and affect our ability to profitably sell our product candidates.

Legislative and regulatory

proposals have been made to expand post-approval requirements and restrict sales and promotional activities for pharmaceutical

We do not know whether additional legislative changes will be enacted, or whether the FDA regulations, guidance or interpretations

will be changed, or what the impact of such changes on the marketing approvals of our product candidates, if any, may be.

increased scrutiny by the U.S.

Congress of the FDA’s approval process may significantly delay or prevent marketing approval,

as well as subject us to more stringent product labeling and post-marketing testing and other requirements.

the United States, the Medicare Modernization Act (“MMA”) changed the way Medicare covers and pays for pharmaceutical

As a result of this legislation and the expansion of federal coverage of drug products, we expect that there will be

additional pressure to contain and reduce costs.

These cost reduction initiatives and other provisions of this legislation could

decrease the coverage and price that we receive for our product candidates and could seriously harm our business.

Patient Protection and Affordable Care Act, as amended by the Health Care and Education Affordability Reconciliation Act of 2010

(collectively, the “Health Care Reform Law”) is a sweeping law intended to broaden access to health insurance, reduce

or constrain the growth of healthcare spending, enhance remedies against fraud and abuse, add new transparency requirements for

healthcare and health insurance industries, impose new taxes and fees on the health industry and impose additional health policy

The Health Care Reform Law remains subject to legislative efforts to repeal, modify or delay the implementation of the

However, if the Health Care Reform Law is repealed or modified, or if implementation of certain aspects of the Health Care

Reform Law are delayed, such repeal, modification or delay may materially adversely impact our business, strategies, prospects,

operating results or financial condition.

addition, other legislative changes have been proposed and adopted in the United States since the Health Care Reform Law was enacted.

We expect that additional federal healthcare reform measures will be adopted in the future, any of which could limit the amounts

that federal and state governments will pay for healthcare products and services, and in turn could significantly reduce the projected

value of certain development projects and reduce or eliminate our profitability.

commercialization of our products, we may be dependent on third parties to market, distribute and sell our products.

ability to receive revenues may be dependent upon the sales and marketing efforts of any future co-marketing partners and third-party

distributors.

At this time, we have not entered into an agreement with any commercialization partner and only plan to do so after

the successful completion of Phase 1 clinical trials and prior to commercialization.

If we fail to reach an agreement with any

commercialization partner, or upon reaching such an agreement that partner fails to sell a large volume of our products, it may

have a negative impact on our business, financial condition and results of operations.

events involving our products may lead the FDA to delay or deny clearance for our products or result in product recalls that could

harm our reputation, business and financial results.

a product receives FDA clearance or approval, the agency has the authority to require the recall of commercialized products in

the event of adverse side effects, material deficiencies or defects in design or manufacture.

The authority to require a recall

must be based on an FDA finding that there is a reasonable probability that the product would cause serious injury or death.

Manufacturers

may, under their own initiative, recall a product if any material deficiency in a product is found.

A government-mandated or voluntary

recall by us or one of our distributors could occur as a result of adverse side effects, impurities or other product contamination,

manufacturing errors, design or labeling defects or other deficiencies and issues.

Recalls of any of our products would divert

managerial and financial resources and have an adverse effect on our financial condition and results of operations.

The FDA requires

that certain classifications of recalls be reported to FDA within ten working days after the recall is initiated.

Companies are

required to maintain certain records of recalls, even if they are not reportable to the FDA.

We may initiate voluntary recalls

involving our products in the future that we determine do not require notification of the FDA.

If the FDA disagrees with our determinations,

they could require us to report those actions as recalls.

A future recall announcement could harm our reputation with customers

and negatively affect our sales.

In addition, the FDA could take enforcement action for failing to report the recalls when they

were conducted.

Related to Ownership of Our Common Stock

face evolving regulation of corporate governance and public disclosure that may result in additional expenses and continuing uncertainty.

a public company, we incur significant legal, accounting and other expenses.

The Sarbanes-Oxley Act of 2002, or SOX, the

Dodd-Frank Wall Street Reform and Consumer Protection Act, the listing requirements of The NASDAQ Global Market and other applicable

securities rules and regulations impose various requirements on public companies, including establishment and maintenance of effective

disclosure and financial controls and corporate governance practices.

Our management and other personnel devote a substantial

amount of time towards maintaining compliance with these requirements.

These rules, regulations and standards are subject to varying

interpretations, and, as a result, their application in practice may evolve over time as new guidance is provided by regulatory

and governing bodies.

This could result in continuing uncertainty regarding compliance matters and higher costs necessitated

by ongoing revisions to disclosure and governance practices.

We intend to invest the resources necessary to comply

with evolving laws, regulations and standards, and this investment may result in increased general and administrative expenses

and a diversion of management time and attention from revenue-generating activities to compliance activities.

efforts to comply with new or changed laws, regulations and standards differ from the activities intended by regulatory or governing

bodies, regulatory authorities may initiate legal proceedings against us, which could be costly and time-consuming, and our reputation

and business may be harmed.

common stock may be delisted from The Nasdaq Capital Market if we fail to comply with continued listing standards.

common stock is currently traded on The NASDAQ Capital Market under the symbol “SPEX”.

If we fail to meet

any of the continued listing standards of The NASDAQ Capital Market, our common stock could be delisted from The NASDAQ Capital

These continued listing standards include specifically enumerated criteria, such as:

a $1.00 minimum

closing bid price;

common stock is currently traded on The Nasdaq Capital Market under the symbol “AIKI”.

If we fail to meet any of the

continued listing standards of The Nasdaq Capital Market, our common stock could be delisted from The Nasdaq Capital Market.

continued listing standards include specifically enumerated criteria, such as:

$1.00 minimum closing bid price;

stockholders’

equity of $2.5 million;

500,000 shares

of publicly-held common stock with a market value of at least $1 million;

300 round-lot

stockholders;

shares of publicly-held common stock with a market value of at least $1 million;

round-lot stockholders;

with Nasdaq’s corporate governance requirements, as well as additional or more stringent criteria that may be applied

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market makers comply with quotation requirements.

In addition, delisting of our common stock could depress our stock

price, substantially limit liquidity of our common stock and materially adversely affect our ability to raise capital on terms

acceptable to us, or at all.

Further, delisting of our common stock would likely result in our common stock becoming a “penny

under the Exchange Act.

In addition, delisting of our common stock could depress our stock price, substantially

limit liquidity of our common stock and materially adversely affect our ability to raise capital on terms acceptable to us, or

Further, delisting of our common stock would likely result in our common stock becoming a “penny stock”

the Exchange Act.

share price may be volatile and there may not be an active trading market for our common stock.

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be an active trading market for our common stock.

The market prices of technology or technology related companies have been

and are likely to continue to be highly volatile.

Fluctuations in our operating results and general market conditions for

technology or technology related stocks could have a significant impact on the volatility of our common stock price.

experienced significant volatility in the price of our common stock.

From January 1, 2019 through December 31, 2019,

the share price of our common stock (on a split-adjusted basis) ranged from a high of $3.92 to a low of $1.05.

The reason for

the volatility in our stock is not well understood and may continue.

Factors that may have contributed to such volatility

include, but are not limited to:

The market prices of technology or technology related companies have been and

are likely to continue to be highly volatile.

Fluctuations in our operating results and general market conditions for technology

or technology related stocks could have a significant impact on the volatility of our common stock price.

We have experienced

significant volatility in the price of our common stock.

From January 1, 2020 through December 31, 2020, the share price of our

common stock (on a split-adjusted basis) ranged from a high of $3.22 to a low of $0.49.

The reason for the volatility in our stock

is not well understood and may continue.

Factors that may have contributed to such volatility include, but are not limited to:

regarding regulatory filings;

funding requirements and the terms of our financing arrangements;

technological

of new technologies by us or our competitors;

changes in existing litigation;

in the enforceability or other matters surrounding our patent portfolios;

regulations and laws;

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speculation regarding any of the foregoing.

could fail in future financing efforts or be delisted from The NASDAQ Capital Market if we fail to receive stockholder approval

are required under the NASDAQ rules to obtain stockholder approval for any issuance of additional equity securities that would

comprise more than 20% of the total shares of our common stock outstanding before the issuance of such securities sold at a discount

to the greater of book or market value in an offering that is not deemed to be a “public offering”

of our operations and acquisitions of assets may require issuance of additional equity securities that would comprise more than

20% of the total shares of our common stock outstanding, but we might not be successful in obtaining the required stockholder

approval for such an issuance.

If we are unable to obtain financing due to stockholder approval difficulties, such failure may

have a material adverse effect on our ability to continue operations.

shares of common stock are thinly traded and, as a result, stockholders may be unable to sell at or near ask prices, or at all,

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will develop or be sustained, or that current trading levels will be sustained.

of the Shareholder Rights Plan and “anti-takeover”

provisions in our Certificate of Incorporation and Bylaws, a

third party may be discouraged from making a takeover offer that could be beneficial to our stockholders.

as of January 24, 2013, we adopted a shareholder rights plan which was amended and restated as of June 9, 2017.

The effect of

this rights plan and of certain provisions of our Certificate of Incorporation, By-Laws, and the anti-takeover provisions of the

Delaware General Corporation Law, could delay or prevent a third party from acquiring us or replacing members of our Board of

Directors, or make more costly any attempt to acquire control of the Company, even if the acquisition or the Board designees would

be beneficial to our stockholders.

These factors could also reduce the price that certain investors might be willing to pay for

shares of the common stock and result in the market price being lower than it would be without these provisions.

of the “anti-takeover”

provisions in our Amended and Restated Certificate of Incorporation, Amended and Restated Bylaws

and Delaware General Corporation Law, a third party may be discouraged from making a takeover offer that could be beneficial to

our stockholders.

effect of certain provisions of our Amended and Restated Certificate of Incorporation, Amended and Restated Bylaws and the anti-takeover

provisions of the Delaware General Corporation Law (the “DGCL”), could delay or prevent a third party from acquiring

us or replacing members of our Board of Directors, or make more costly any attempt to acquire control of the Company, even if

the acquisition or the Board designees would be beneficial to our stockholders.

These factors could also reduce the price that

certain investors might be willing to pay for shares of the common stock and result in the market price being lower than it would

be without these provisions.

on our common stock are not likely.

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common stock in the foreseeable future.

Investors must look solely to the potential for appreciation in the market

price of the shares of our common stock to obtain a return on their investment.

Investors must look solely to the potential for appreciation in the market price of the

shares of our common stock to obtain a return on their investment.

may be difficult to predict our financial performance because our quarterly operating results may fluctuate.

currently do not have any revenues and our operating results and valuations of certain assets and liabilities may vary significantly

from quarter to quarter due to a variety of factors, many of which are beyond our control.

You should not rely on period-to-period

comparisons of our results of operations as an indication of our future performance.

Our results of operations may fall below

the expectations of market analysts and our own forecasts.

If this happens, the market price of our common stock may fall significantly.

The factors that may affect our quarterly operating results include the following:

in results of our enforcement and licensing activities or outcome of cases;

in duration of judicial processes and time to completion of cases;

timing and amount of expenses incurred to negotiate with licensees and obtain settlements from infringers;

impact of our anticipated need for personnel and expected substantial increase in headcount;

in the receptiveness of courts and juries to significant damages awards in patent infringement cases and speed to trial in

the jurisdictions in which our cases may be brought and the accepted royalty rates attributable to damages analysis for patent

cases generally, including the royalty rates for industry standard patents which we may own or acquire;

economic conditions which cause revenues or profits attributable to infringer sales of products or services to decline;

in the regulatory environment, including regulation of NPE activities or patenting practices, that may negatively impact our

or infringers practices;

timing and amount of expenses associated with litigation, regulatory investigations or restructuring activities, including

settlement costs and regulatory penalties assessed related to government enforcement actions;

changes we make in our Critical Accounting Estimates described in the Management’s Discussion and Analysis of Financial

Condition and Results of Operations sections of our periodic reports;

adoption of new accounting pronouncements, or new interpretations of existing accounting pronouncements, that impact the manner

in which we account for, measure or disclose our results of operations, financial position or other financial measures;

related to acquisitions of technologies or businesses.

we fail to retain our key personnel, we may not be able to achieve our anticipated level of growth and our business could suffer.

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a smaller reporting company, we are not required to provide the information required by this item.

main office is located in New York, New York where we lease one office with a monthly payment of approximately $3,320.

lease space in Longview, Texas, on a month to month basis, for approximately $2,000 per month.

We believe that the New York and

Texas facilities are sufficient to meet our needs.

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 1A. Risk Factors