What changed in this filing

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Item 2. Management’s Discussion and Analysis

2023-05-12 compared with 2022-11-14 · 135 added, 156 removed, 34 unchanged (90% of the section changed)

MANAGEMENT’S DISCUSSION

AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL

CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis

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information in this Report is financial information for the Company .

The Company is engaged in the business

of the sale of 3D haptics products and equipment.

Novint Technologies,

(“Novint”, the “Company”, “we”, “our”, “us”) was originally incorporated

in the State of New Mexico in April 1999.

On February 26, 2002, the Company changed its state of incorporation to Delaware by merging

with Novint Technologies, Inc., a Delaware corporation.

This merger was accounted for as a reorganization.

Nature of Business

The Company currently

is engaged in the sale of 3D haptics products and equipment.

Haptics refers to one’s sense of touch.

The Company’s focus

is in the consumer interactive computer gaming market, but the Company also does project work in other areas.

The Company sells

its haptics products primarily to consumers through online retail marketplaces.

Results of Operations for the Three

Months Ended September 30, 2022 and 2021

Three months ended

September 30,

The Company recorded revenue of $0 and

$913 for the three-month period ended September 30, 2022 and September 30, 2021.

The Company incurred revenue in the three-month

period ended September 30, 2021 from the sale of Falcon 3D Touch Haptic Controllers.

The Company expects to continue to incur significant

expenses and operating losses for the foreseeable future.

The Company’s net losses may fluctuate significantly from quarter

to quarter and year to year.

Operating Expenses

Three months ended

September 30,

Operating Expenses

Operating expenses increased by $8,382

or 30% to $36,456 for the three months ended September 30, 2022, compared with $28,074 for the three months ended September 30,

This increase was due primarily to an increase in Professional fees that were incurred during the three months ended September

Other Expense

Three months ended

September 30,

Other Expense

Other expense decreased by $50 or 100%

to $0 during the three months ended September 30, 2022 compared with $50 during the three months ended September 30, 2021.

expense for the three months ended September 30, 2021 consisted of interest expense related to finance charges on credit cards.

Results of Operations for the Nine Months Ended September

The Company’s

focus is on the consumer interactive computer gaming market, but the Company conducts project work in non-gaming areas as well.

Our principal product

is the Falcon, an extensible, grounded (e.g., desktop), three-dimensional (3D) haptic interaction device with characteristics optimized

for real-time force-feedback and tactile interaction.

Additionally, we have developed but not yet commercialized the Xio product,

a next generation, full arm, game controller with forced feedback.

Currently, we are focused on engaging in discussions with potential

partners and studying other ways to realize value from the Falcon and Xio products.

Results of Operations for the Three Months Ended March 31,

2023 and 2022

Nine months ended

September 30,

The Company recorded revenue of $0 and

$2,568 for the nine-month period ended September 30, 2022 and September 30, 2021.

The Company incurred revenue in the nine-month

period ended September 30, 2021 from the sales of Falcon 3D Touch Haptic Controller.

The Company expects to continue to incur significant

expenses and operating losses for the foreseeable future.

The Company’s net losses may fluctuate significantly from quarter

to quarter and year to year.

Three months ended March 31,

The Company recorded

revenue of $0 and $0 for the three-month period ended March 31, 2023 and March 31, 2022.

The Company expects to continue to incur

significant expenses and operating losses for the foreseeable future.

The Company’s net losses may fluctuate significantly

from quarter to quarter and year to year.

Operating Expenses

Nine months ended

September 30,

Three months ended March 31,

Operating Expenses

Operating expenses increased by $8,128

or 7% to $122,614 for the nine months ended September 30, 2022, compared with $114,486 for the nine months ended September 30,

This increase was primarily due to an increase in Professional fees that were incurred during the nine months ended September

Operating expenses

increased by $1,079 or 2% to $50,379 for the three months ended March 31, 2023, from $49,300 for the three months ended March 31,

This increase was primarily due to an increase in professional fees incurred during the three months ended March 31, 2023.

Other Expense

Nine months ended

September 30,

Three months ended March 31,

Other Expense

Other expense decreased by $141 or 91%

to $14 during the nine months ended September 30, 2022 compared with $155 during the nine months ended September 30, 2021.

expense for the nine months ended September 30, 2022 and September 30, 2021 consisted of interest expense related to finance charges

on credit cards.

Other expense decreased

by $14 or 100% to $0 during the three months ended March 31, 2023 compared with $14 during the three months ended March 31, 2022.

Other expense for the three months ended March 31, 2022 consisted of interest expense related to finance charges on credit cards

which was fully paid off during the period ended March 31, 2022.

Liquidity and Capital Resources

The following table summarizes select Balance

sheet and working capital amounts as of September 30, 2022 and December 31, 2021:

September 30,

Increase (Decrease)

Sheet and working capital amounts as of March 31, 2023 and December 31, 2022:

Working capital deficit

The Company had a stockholders’ deficit

of approximately $41,747,258 and $41,624,630 at September 30, 2022 and December 31, 2021, respectively.

Net loss for the nine months

ended September 30, 2022 and 2021 was $122,628 and $112,073, respectively.

Net cash used in operating activities was $88,227 and

$93,010 for the nine months ended September 30, 2022 and 2021, respectively.

Operations since inception have been funded primarily

with the proceeds from equity and debt offerings.

As of September 30, 2022, the Company had cash of $97,708.

The Company’s management has evaluated

whether there is substantial doubt about the Company’s ability to continue as a going concern and has determined that substantial

doubt existed as of the date of this filing.

At March 31, 2023,

the Company had a working capital deficit of approximately $774,235.

Accumulated deficit amounted to $41,853,759 and $41,803,380

at March 31, 2023 and December 31, 2022, respectively.

Net loss for the three months ended March 31, 2023 and 2022 was $50,379

and $49,314, respectively.

Net cash used in operating activities was $31,725 and $38,788 for the three months ended March 31, 2023

and 2022, respectively.

Operations since inception have been funded primarily with the proceeds from equity and debt offerings.

As of March 31, 2023, the Company had cash of $23,356.

The Company’s

management has evaluated whether there is substantial doubt about the Company’s ability to continue as a going concern and

has determined that substantial doubt existed as of the date of this filing.

This determination was based on the following factors:

(i) the Company’s available

cash as of the date of this filing will not be sufficient to fund its anticipated level of operations for the next 12 months;

the Company has incurred recurring losses and at September 30, 2022, had an accumulated deficit of $41,747,258;

(iii) the Company

sustained an operating loss of $122,614 for the period ended September 30, 2022;

and (iv) if the Company fails to obtain the needed

capital, it will be forced to delay, scale back, or eliminate some or all of its programs or perhaps cease operations.

In the opinion

of management, these factors, among others, raise substantial doubt about the ability of the Company to continue as a going concern.

There is no assurance that the Company

will be successful in any capital-raising efforts that it may undertake to fund operations during 2022.

The Company anticipates

that it will continue to issue equity and/or debt securities as a source of liquidity, until it begins to generate positive cash

flow to support its operations.

Any future sales of securities to finance operations will dilute existing stockholders’ ownership.

(i) the Company’s available cash as of the date of this filing will not be sufficient to fund its anticipated level of operations

for the next 12 months;

(ii) the Company has incurred recurring losses and at March 31, 2023, had an accumulated deficit of $41,853,759;

(iii) the Company sustained an operating loss of $50,379 for the period ended March 31, 2023;

and (iv) if the Company fails to

obtain the needed capital, it will be forced to delay, scale back, or eliminate some or all of its programs or perhaps cease operations.

In the opinion of management, these factors, among others, raise substantial doubt about the ability of the Company to continue

as a going concern.

There is no assurance

that the Company will be successful in any capital-raising efforts that it may undertake to fund operations during 2023.

anticipates that it will continue to issue equity and/or debt securities as a source of liquidity, until it begins to generate

positive cash flow to support its operations.

Any future sales of securities to finance operations will dilute existing stockholders’

The Company cannot guarantee when or if it will generate positive cash flow.

The audit report prepared by our independent

registered public accounting firm relating to the Company’s consolidated financial statements for the year ended December

31, 2021 included an explanatory paragraph expressing substantial doubt about our ability to continue as a going concern.

The audit report prepared

by our independent registered public accounting firm relating to the Company’s consolidated financial statements for the

year ended December 31, 2022 included an explanatory paragraph expressing substantial doubt about our ability to continue as a

going concern.

Cash Flow Activities

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cash flows for the periods set forth below:

Nine months ended

September 30,

Three months ended March 31,

Net cash used in operating activities

Net cash used in operating activities for

the nine months ended September 30, 2022 was $88,227, compared with net cash used in operating activities of $93,010 for the nine

months ended September 30, 2021.

The decrease in net cash used in operating activities during the nine months ended September 30,

2022 was due primarily to an increase in net loss to $122,628, partially offset by an increase of $37,500 in accrued royalties.

Net cash used in operating activities for

the nine months ended September 30, 2021 was $93,010, primarily due to a net loss of $112,073, partially offset by an increase

of $37,500 in accrued royalties and a decrease of $1,072 in prepaid expenses and other current assets.

Net cash used in operating

activities for the three months ended March 31, 2023 was $31,725 compared with net cash used in operating activities of $38,788

for the three months ended March 31, 2022.

The decrease in net cash used in operating activities was primarily due to an increase

of $6,289 in accounts payable and accrued expenses for the three months ended March 31, 2023, compared to a decrease in accounts

payable and accrued expenses of $3,131 for the three months ended March 31, 2022.

Net cash used in operating

activities for the three months ended March 31, 2023 was $38,788, representing a net loss of $50,379 partially offset by an increase

of $12,500 in accrued royalties and by an increase of $6,289 in accounts payable and accrued expenses.

Effects of Inflation

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sheet arrangements or financing activities with special-purpose entities.

Critical Accounting Policies and Use

Critical accounting policies are those

policies which are both important to the presentation of a company’s financial condition and results and require management’s

most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that

are inherently uncertain.

There have been no recent significant changes to our accounting policies and use of estimates during

the nine months ended September 30, 2022.

For a further discussion of our critical accounting policies, see our Annual Report

on Form 10-K for the fiscal year ended December 31, 2021 filed with the SEC on March 23, 2022.

Forward Looking Statements and Certain

Factors That May Affect Future Results of Operations

The Securities and Exchange Commission

encourages companies to disclose forward-looking information so that investors can better understand a company’s future prospects

and make informed investment decisions.

This Quarterly Report on Form 10-Q contains such “forward-looking statements”

within the meaning of the Private Securities Litigation Reform Act of 1995.All statements in this report, other than statements

of historical fact, are forward-looking statements for purposes of these provisions, including any projections of earnings, revenues

or other financial items, any statements of the plans and objectives of management for future operations, any statements concerning

proposed new products or services, any statements regarding future economic conditions or performance, and any statements of assumptions

underlying any of the foregoing.

All forward-looking statements included in this report are made as of the date hereof and are

based on information available to us as of such date.

We assume no obligation to update any forward-looking statement.

cases, forward-looking statements can be identified by the use of terminology such as “may,” “will,” “expects,”

“plans,” “anticipates,” “intends,” “believes,” “estimates,” “potential,”

or “continue,” or the negative thereof or other comparable terminology.

Although we believe that the expectations reflected

in the forward-looking statements contained herein are based upon reasonable assumptions at the time made, there can be no assurance

that any such expectations or any forward-looking statement will prove to be correct.

Our actual results will vary, and may vary

materially, from those projected or assumed in the forward-looking statements.

Future financial condition and results of operations,

as well as any forward-looking statements, are subject to inherent risks and uncertainties, many of which we cannot predict with

accuracy and some of which we might not anticipate, including, without limitation, product liability claims;

infringement of our

technology or assertion that our technology infringes the rights of other parties;

termination of supplier relationships, or failure

of suppliers to perform;

Critical Accounting Policies and Use of Estimates

Critical accounting

policies are those policies which are both important to the presentation of a company’s financial condition and results and

require management’s most difficult, subjective or complex judgments, often as a result of the need to make estimates about

the effect of matters that are inherently uncertain.

There have been no recent significant changes to our accounting policies

and use of estimates during the three months ended March 31, 2023.

For a further discussion of our critical accounting policies,

see our Annual Report on Form 10-K for the fiscal year ended December 31, 2022.

Forward-Looking Statements and Certain Factors That May Affect

Future Results of Operations

The Securities and

Exchange Commission encourages companies to disclose forward-looking information so that investors can better understand a company’s

future prospects and make informed investment decisions.

This Quarterly Report on Form 10-Q contains such “forward-looking

statements” within the meaning of the Private Securities Litigation Reform Act of 1995.All statements in this report, other

than statements of historical fact, are forward-looking statements for purposes of these provisions, including any projections

of earnings, revenues or other financial items, any statements of the plans and objectives of management for future operations,

any statements concerning proposed new products or services, any statements regarding future economic conditions or performance,

and any statements of assumptions underlying any of the foregoing.

All forward-looking statements included in this report are made

as of the date hereof and are based on information available to us as of such date.

We assume no obligation to update any forward-looking

In some cases, forward-looking statements can be identified by the use of terminology such as “may,” “will,”

“expects,” “plans,” “anticipates,” “intends,” “believes,” “estimates,”

“potential,” or “continue,” or the negative thereof or other comparable terminology.

Although we believe

that the expectations reflected in the forward-looking statements contained herein are based upon reasonable assumptions at the

time made, there can be no assurance that any such expectations or any forward-looking statement will prove to be correct.

actual results will vary, and may vary materially, from those projected or assumed in the forward-looking statements.

Future financial

condition and results of operations, as well as any forward-looking statements, are subject to inherent risks and uncertainties,

many of which we cannot predict with accuracy and some of which we might not anticipate, including, without limitation, product

recalls and product liability claims;

infringement of our technology or assertion that our technology infringes the rights of other

termination of supplier relationships, or failure of suppliers to perform;

inability to successfully manage growth;

concentration of our revenue among a few customers, products

or procedures;

in obtaining regulatory approvals or the failure to maintain such approvals;

concentration of our revenue among a few customers,

products or procedures;

development of new products and technology that could render our products obsolete;

market acceptance of new products;

market acceptance of

new products;

introduction of products in a timely fashion;

price and product competition, availability of labor and materials, cost increases,

and fluctuations in and obsolescence of inventory;

price and product competition, availability of labor and materials,

cost increases, and fluctuations in and obsolescence of inventory;

volatility of the market price of our common stock;

foreign currency fluctuations;

currency fluctuations;

changes in key personnel;

1 unchanged sentence

integration of business acquisitions;

and other factors referred

to in our reports filed with the SEC.

All subsequent forward-looking statements attributable to us or persons acting on our behalf

are expressly qualified in their entirety by these cautionary statements.

In light of these assumptions, risks and uncertainties,

the results and events discussed in the forward-looking statements contained in this Quarterly Report or in any document incorporated

by reference might not occur.

Stockholders are cautioned not to place undue reliance on the forward-looking statements, which speak

only as of the date of this Quarterly Report.

We are not under any obligation, and we expressly disclaim any obligation, to update

or alter any forward-looking statements, whether as a result of new information, future events or otherwise.

other factors referred to in our reports filed with the SEC, including our Registration Statement on Form 10.

All subsequent forward-looking

statements attributable to us or to any person acting on our behalf are expressly qualified in their entirety by the cautionary

statements contained or referred to in this section.

statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by these cautionary statements.

Additional factors that may have a direct bearing on our operating results are discussed in Item 1A “Risk Factors”

in our Registration Statement on Form 10.

In light of these assumptions, risks and uncertainties, the results and events discussed

in the forward-looking statements contained in this Quarterly Report or in any document incorporated by reference might not occur.

Stockholders are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date of this

Quarterly Report.

We are not under any obligation, and we expressly disclaim any obligation to update or alter any forward-looking

statements, whether as a result of new information, future events or otherwise.

All subsequent forward-looking statements attributable

to us or to any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or

referred to in this section.

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 2. Management’s Discussion and Analysis