What changed in this filing

/stocks — the workspaceLOADING

Item 5. Market for Registrant’s Common Equity

2021-03-08 compared with 2020-03-10 · 185 added, 208 removed, 242 unchanged (62% of the section changed)

5 unchanged sentences

were approximately 267 holders of record of our common stock.

plan to effect a reverse split of our common stock, or the Planned Reverse Split, and, accordingly, share amounts, per share data,

share prices, exercise prices or conversion rates in this annual report on Form 10-K are subject to change following the effectiveness

of the Planned Reverse Split.

The Planned Reverse Split will not change the authorized number of shares or the par value of our

common stock.

the past, we have not declared or paid cash dividends on our common stock.

1 unchanged sentence

rather, we intend to retain future earnings, if any, to fund the operation and expansion of our business and for general corporate

holders of Series C Preferred Stock are not entitled to receive any dividends, unless and until specifically declared by our board

of directors.

However, holders of our Series C Preferred Stock are entitled to receive dividends on shares of Series C Preferred

Stock equal (on an as-if-converted-to-common-stock basis, and without giving effect for such purposes to the 4.99% or 9.99% beneficial

ownership limitation, as applicable) to and in the same form as dividends actually paid on shares of the common stock when such

dividends are specifically declared by our board of directors.

We are not obligated to redeem or repurchase any shares of Series

C Preferred Stock.

Shares of Series C Preferred Stock are not otherwise entitled to any redemption rights, or mandatory sinking

fund or analogous fund provision.

Selected Financial Data.

12 unchanged sentences

Our CGuard EPS received CE mark approval in the European Union in March

2013, and we launched its release on a limited basis in October 2014.

In January 2015, a new version of CGuard, with a rapid exchange

delivery system, received CE mark approval in Europe and in September 2015, we announced the full market launch of CGuard EPS

Subsequently, we launched CGuard EPS in Russia and certain countries in Latin America and Asia, including India.

expect to receive approval to launch CGuard EPS in Brazil, and we are seeking strategic partners for potential launch of CGuard

EPS in Japan and China.

April 2017, we had a pre-investigational device exemption (“IDE”) submission meeting with the U.S.

Food and Drug Administration

(“FDA”) regarding CGuard EPS where we presented materials that we believed would support a formal IDE submission seeking

approval to conduct a human clinical trial in the United States which included our draft synopsis for the clinical trial design.

The FDA agreed to our pre-clinical test plan and clinical trial design.

On July 26, 2019, we submitted an IDE application for

In connection with such application, on August 23, 2019, we received a request for additional information from the

FDA in support of our application.

We continue to work closely with the FDA to address FDA’s information and testing requests

in support of our pending IDE application, as the initiation of clinical testing in the U.S.

is our current highest priority.

Following resolution of all comments from the FDA, we plan to re-submit the IDE application, as IDE approval by the FDA would

be a critical step toward the commencement of a human clinical trial using CGuard EPS in the United States.

we intend to continue to evaluate potential product enhancements and manufacturing enhancements for CGuard EPS that are

2013 and was fully launched in Europe in September 2015.

Subsequently, we launched CGuard EPS in Russia and certain countries

in Latin America and Asia, including India.

In September 2020, we launched CGuard EPS in Brazil after receiving regulatory approval

in July 2020 and, as discussed below, on February 3, 2021 we executed a distribution agreement with Chinese partners for the purpose

of expanding our presence in China.

Currently, we are seeking strategic partners for a potential launch of CGuard EPS in Japan.

September 8, 2020, we received approval from the FDA of our Investigation Device Exemption (“IDE”), thereby allowing

us to proceed with a pivotal study of our CGuard™

Carotid Stent System, CARENET-III, for prevention of stroke in patients

in the United States.

CARENET-lll is a prospective, multicenter, single-arm, pivotal study to evaluate the safety and efficacy

of the CGuard™

Carotid Stent System when used to treat symptomatic and asymptomatic carotid artery stenosis in patients

undergoing carotid artery stenting.

The trial will enroll approximately 315 subjects in a maximum of 40 study sites located in

the United States.

Additional sites in Europe may also participate in the study, contributing a maximum of ~50% of the total enrollees.

The primary endpoint of the study will be the composite of the following:

incidence of the following major adverse events:

(all- cause mortality), all stroke, and myocardial infarction (DSMI) through 30-days post-index procedure, based on the clinical

events committee (CEC) adjudication or ipsilateral stroke from 31-365 day follow-up, based on Clinical Events Committee (CEC)

adjudication.

Additionally,

we intend to continue to invest in current and future potential product and manufacturing enhancements for CGuard EPS that are

expected to reduce cost of goods and/or provide the best-in-class performing delivery system.

In furtherance of our strategy

focusing on establishing CGuard EPS as a viable alternative to vascular surgery, we are exploring adding a procedural protection

device to our portfolio incorporating the principal of reverse flow of the carotid artery as an adjunctive alternative to femoral

We cannot give any assurance that we will receive sufficient (or any) proceeds from future financings or the timing

of such financings, if ever for potential product enhancements and manufacturing enhancements.

In addition, such additional financings

may be costly or difficult to complete.

Even if we receive sufficient proceeds from future financings, there is no assurance that

we will be able to timely apply for CE mark approval following our receipt of such proceeds.

We believe these improvements may

allow us to reduce cost of goods and increase penetration in our existing geographies and better position us for entry into new

consider the addressable market for our CGuard EPS consists of individuals with diagnosed, symptomatic high-grade carotid artery

stenosis (HGCS, ≥70% occlusion) for whom an intervention is preferable to medical (drug) therapy.

This group includes not only

carotid artery stenting patients but also individuals undergoing carotid endarterectomy, as the two approaches compete for the

same patient population.

Assuming full penetration of the intervention caseload by CGuard EPS, we estimate that the addressable

market for CGuard EPS was approximately $1.0 billion in 2017.

Health Research International 2017 Results of Update

Report on Global Carotid Stenting Procedures and Markets by Major Geography and Addressable Markets ).

In furtherance of our strategy that

focuses on establishing CGuard EPS as a viable alternative to vascular surgery, we are exploring adding new delivery systems and

accessory solutions for procedural protection to our portfolio.

consider the addressable market for our CGuard EPS to be individuals with diagnosed, symptomatic high-grade carotid artery stenosis

(HGCS, ≥70% occlusion) for whom intervention is preferable to medical (drug) therapy.

This group includes not only carotid

artery stenting patients but also individuals undergoing carotid endarterectomy, as the two approaches compete for the same patient

Assuming full penetration of the intervention caseload by CGuard EPS, we estimate that the addressable market for

CGuard EPS was approximately $1.0 billion in 2017 (source:

Health Research International 2017 Results of Update Report on Global

Carotid Stenting Procedures and Markets by Major Geography and Addressable Markets).

MGuard™

7 unchanged sentences

decided to curtail further development of this product in order to focus on the development of a drug-eluting stent product, MGuard

Due to limited resources, though, our efforts have been limited to testing drug-eluting stents manufactured by potential

Due to limited resources, however, our efforts have been limited to testing drug-eluting stents manufactured by potential

partners for compatibility with MicroNet and seeking to incorporate MicroNet onto a drug-eluting stent manufactured by a potential

7 unchanged sentences

none of our products may be sold or marketed in the United States.

as of 5:00 p.m.

Eastern Time on March 29, 2019, we amended our amended and restated certificate of incorporation in order to effectuate

a 1-for-50 reverse stock split of our outstanding shares of common stock.

Accounting Policies

13 unchanged sentences

applicable to these consolidated financial statements, the most significant estimates and assumptions relate to inventory valuations,

classification and fair value of financial instruments, and legal contingencies.

currency of the primary economic environment in which our operations and the operations of our subsidiaries are conducted is the

dollar (“$”

or “dollar”).

Accordingly, our and our subsidiaries’

functional currency is the

dollar figures are determined as follows:

transactions and balances originally denominated in dollars are presented in their original

Balances in foreign currencies are translated into dollars using historical and current exchange rates for non-monetary

and monetary balances, respectively.

The resulting translation gains or losses are recorded as financial income or expense, as

For transactions reflected in the statements of operations in foreign currencies, the exchange rates at transaction

dates are used.

Depreciation and changes in inventories and other changes deriving from non-monetary items are based on historical

exchange rates.

assessing the likelihood of exercise of options to extend the lease term and legal contingencies.

Concentration

2 unchanged sentences

deposited in major financially sound institutions in the United States, Israel and Germany, and trade accounts receivable.

trade accounts receivable are derived from revenues earned from customers from various countries.

trade accounts receivable is derived from revenues earned from customers from various countries.

We perform ongoing credit evaluations

75 unchanged sentences

accelerated multiple option approach.

addition, certain of our share-based awards are market- and performance-based and dependent upon achieving certain goals.

respect to performance-based awards, we estimate the expected pre-vesting award probability that the performance conditions will

We only recognize expense for those shares that are expected to vest.

value measurement

15 unchanged sentences

months ended December 31, 2020 compared to the twelve months ended December 31, 2019

For the twelve months ended December 31, 2019, revenue increased by $120,000, or 3.3%, to $3,721,000, from $3,601,000 during the

twelve months ended December 31, 2018.

This increase was predominantly driven by a 10.0% increase in sales volume of CGuard EPS

For the twelve months ended December 31, 2020, revenue decreased by $1,236,000, or 33.2%, to $2,485,000, from $3,721,000 during

the twelve months ended December 31, 2019.

Revenues were negatively impacted by 15.6% due to a settlement of litigation with a

former distributor in 2014 (see Part I, Item 3.

“Legal Proceedings”) under which we agreed to pay them $580,000.

US GAAP we were required to charge that amount against revenues.

In addition, there was a 15.3% decrease in sales volume of CGuard

EPS from $3,265,000 during the twelve months ended December 31, 2019, to $2,764,000 during the twelve months ended December 31,

2020, mainly due to the postponement of procedures with CGuard EPS, which are generally scheduled or nonemergency procedures,

as hospitals shifted resources to patients affected by COVID-19.

There was a 34.0% decrease in sales volume of MGuard Prime EPS

from $456,000 during the twelve months ended December 31, 2019, to $301,000 during the twelve months ended December 31, 2020,

This increase was primarily due to our continued focus on expanding existing markets such as Poland, Switzerland, Italy, and Spain

and expansion into new geographies such as Australia and South Africa.

This increase was offset by a 27.7% decrease in sales volume

of MGuard Prime EPS from $631,000 during the twelve months ended December 31, 2018, to $456,000 during the twelve months ended

December 31, 2019, largely driven by the predominant industry preferences favoring drug-eluting stents rather than bare metal

stents such as MGuard Prime EPS in STEMI patients.

addition, the overall increase mentioned above was offset across the board by shipment delays in the three months ended March

31, 2019 associated with our then third-party sterilizer’s equipment failure and us having to switch to a new sterilizer.

The transition to our new sterilization company was completed in early April 2019 and we do not currently anticipate any

future disruptions in fulfilling new orders.

respect to regions, the increase in revenue was primarily attributable to an increase of $78,000 in revenue from sales made in

Australia and South Africa (driven by $78,000 growth of CGuard EPS for reasons mentioned above), as well as an increase of $25,000

in revenue from sales made in Europe (driven by $168,000 growth of CGuard EPS for reasons mentioned above, offset by a $143,000

decrease in sales of MGuard Prime EPS).

mainly due to the postponement of procedures with MGuard Prime EPS, which are generally scheduled or nonemergency procedures,

as hospitals shifted resources to patients affected by COVID-19.

respect to regions, the decrease in revenue was primarily attributable to a decrease of $985,000 in revenue from sales made in

Europe (driven by $580,000 decrease of the settlement with a former distributor and $329,000 decrease of CGuard EPS and $76,000

decrease of MGuard Prime EPS for the reasons discussed in the paragraph above), a decrease of $131,000 in revenue of CGuard from

sales made in Asia due to the same COVID-19-related factor, as well as a decrease of $79,000 in revenue from sales made in Latin

America (primarily driven by a $68,000 decrease of MGuard Prime EPS sales due to the same COVID-19-related factor).

For the twelve months ended December 31, 2020, gross profit (revenue less cost of revenues) decreased by 89.0%, or

$673,000, to $83,000, compared to a $756,000 for the same period in 2019.

This decrease in gross profit resulted from a $142,000

increase in write-offs predominantly driven by a non-recurring component supply issue of CGuard EPS and slow moving inventory

of MGuard Prime EPS, $69,000 of expenses related to upgrades made to our production facilities and $48,000 of expenses pertaining

to annual and new employee training of the production workers, and offset by a reduction of $20,000 in miscellaneous expenses.

Gross margin (gross profits as a percentage of revenue) decreased to 20.3% during the twelve months ended December 31, 2019 from

27.6% during the twelve months ended December 31, 2018, driven mainly by the write-offs and the increased expenses incurred in

connection with the upgrades made to our production facilities and employee trainings incurred during the twelve months ended

December 31, 2019.

This decrease in gross profit resulted from the impact

of the $580,000 settlement with our former distributor in 2014 as well as $198,000 decrease in revenues less the related material

and labor costs (as mentioned above).

This decrease was partially offset by a decrease of $69,000 in expenses related to upgrades

made to our production facilities during the year ended December 31, 2019, which did not reoccur during the year ended December

31, 2020 and a decrease of $36,000 in miscellaneous expenses during the year ended December 31, 2020.

Gross margin (gross profits

as a percentage of revenue) decreased to 3.3% during the year ended December 31, 2020 from 20.3% during the year ended December

31, 2019, driven mainly by a negative effect on gross margin of 18.3% due to the settlement with our former distributor offset

by a 1.3% gross margin increase due to the upgrades made to our production facilities and miscellaneous expenses as mentioned

and Development Expenses .

For the twelve months ended December 31, 2019, research and development expenses increased by 92.4%,

For the twelve months ended December 31, 2020, research and development expenses decreased by 24.4%,

or $721,000, to $2,233,000, from $2,954,000 during the twelve months ended December 31, 2020.

This increase resulted primarily

from an increase of $804,000 in clinical expenses associated with CGuard EPS, mainly related to IDE application process, a settlement

payment of $354,000 made to a former service provider pursuant to a settlement agreement (see Part II, Item 1.

“Legal Proceedings”

below), and an increase of $298,000 in compensation expenses primarily incurred to support various development projects.

increases in research and development expenses were partially offset by a decrease of $37,000 in miscellaneous expenses.

This decrease resulted primarily

a decrease of $861,000 in clinical expenses associated with CGuard EPS, mainly related to the IDE approval process, of which

an approval from the FDA was received on September 8, 2020, a decrease of $354,000 due to settlement expenses that were paid to

a former service provider pursuant to a settlement agreement during the year ended December 31, 2019, which did not reoccur during

the year ended December 31, 2020, and a decrease of $136,000 in quality assurance and regulatory expenses related to the development

of various projects during the year ended December 31, 2019, which were significantly reduced during the year ended December 31,

These decreases were partially offset by an increase of $531,000 in development expenses related to the CGuard EPS new delivery

system and accessory solutions and an increase of $99,000 in miscellaneous expenses.

and Marketing Expenses .

For the twelve months ended December 31, 2019, selling and marketing expenses increased by 6.9%, or

$155,000, to $2,396,000, from $2,241,000 during the twelve months ended December 31, 2018.

This increase resulted from an increase

of $61,000 in travel expenses associated with our efforts to expand existing and new markets, an increase of $90,000 in promotional

expenses, primarily related to operating our social media infrastructure and increase of $4,000 in miscellaneous expenses during

the twelve months ended December 31, 2019.

For the twelve months ended December 31, 2020, selling and marketing expenses decreased by 12.2%,

or $293,000, to $2,103,000, from $2,396,000 during the twelve months ended December 31, 2020.

This decrease resulted primarily

a decrease in travel expenses of $268,000 in light of restrictions imposed by governments worldwide in order to mitigate

the spread of COVID-19 during year ended December 31, 2020, a decrease of $129,000 in promotional expenses, primarily related

to having already built our social media infrastructure in 2019, and a decrease of $88,000 in miscellaneous expenses.

These decreases

were partially offset by an increase of $192,000 in compensation expenses.

and Administrative Expenses .

2 unchanged sentences

This increase resulted

primarily from an increase of $766,000 in compensation expenses, mainly due to compensation expenses related to the separation

agreement with our former CEO and an increase of $31,000 in miscellaneous expenses.

This increases in general and administrative

expenses was partially offset by decrease of $405,000 in legal expenses, primarily due to reduced legal work required for a litigation

with a former service provider (which settled in April 2019) during the twelve months ended December 31, 2019, compared to the

amount of legal work required for the same litigation during the twelve months ended December 31, 2018.

Expenses (Income) .

For the twelve months ended December 31, 2019, financial expenses increased by 153.9%, or $571,000, to

$200,000, from $371,000 of financial income during the twelve months ended December 31, 2018.

The increase in financial expenses

primarily resulted from the $438,000 of financial income related to the revaluation of the embedded derivative of the Series C

Preferred Stock recorded during the twelve months ended December 31, 2018, which did not occur during the twelve months ended

in December 31, 2019, and an increase of $144,000 in financial expenses related to changes in exchange rates.

These increases

in financial expenses were partially offset by a decrease of $11,000 in miscellaneous expenses during the twelve months ended

December 31, 2019.

primarily from an increase of $400,000 due to expenses for the settlement agreement with the underwriter of our prior offerings

paid during the year ended December 31, 2020, an increase in our Directors’

and Officers’

Liability Insurance expenses

of $249,000 partially due to recent economic effects on the insurance industry caused by the COVID-19 pandemic, an increase in

regulatory expenses of $177,000 required for new regulatory standards and an increase of $79,000 in miscellaneous expenses.

For the twelve months ended December 31, 2020, financial expenses decreased by 20.0%, or $40,000, to $160,000, from

$200,000 during the year ended December 31, 2020.

The decrease in financial expenses primarily resulted from a decrease of $66,000

in financial expenses related to changes in exchange rates, offset, in part, by an increase of $26,000 in miscellaneous expenses.

Expenses (Income).

For the twelve months ended December 31, 2019, tax expenses increased by $24,000 compared to the twelve

For the twelve months ended December 31, 2020, tax expenses decreased by $20,000 compared to the twelve

months ended December 31, 2019.

1 unchanged sentence

during the twelve months ended December 31, 2019.

The increase in net loss resulted primarily from an increase of $1,966,000

in operating expenses, an increase of $571,000 in financial expenses and a decrease of $239,000 in gross profit.

The increase in net loss resulted primarily from a decrease of $673,000 in gross

profit, offset, in part, by a decrease of $109,000 in operating expenses, a decrease of $40,000 in financial expenses and a decrease

of $20,000 in tax expenses.

and Capital Resources

had an accumulated deficit as of December 31, 2019 of $158 million, as well as a net loss of $10,040,000 and negative operating

We expect to continue incurring losses and negative cash flows from operations until our products (primarily CGuard

of the date of issuance of the consolidated financial statements, we have the ability to fund our planned operations for at least

the next 12 months.

However, we expect to continue incurring losses and negative cash flows from operations until our products

(primarily CGuard™

EPS) reach commercial profitability.

As a result of these expected losses and negative cash flows from operations, along with

our current cash position, we believe we have sufficient resources to fund operations until the end of May 2020.

Therefore, there

is substantial doubt about our ability to continue as a going concern.

plans include the continued commercialization of our products and raising capital through the sale of additional equity securities,

debt or capital inflows from strategic partnerships.

There are no assurances, however, that we will be successful in obtaining

the level of financing needed for our operations.

If we are unsuccessful in commercializing our products and raising capital,

we may need to reduce activities, curtail or cease operations.

Financings and Recapitalization

January and February 2018, the placement agent from the public offering that closed in July 2016 exercised its unit purchase option

to purchase 13,508 units and received 13,508 shares of Series B Preferred Stock and Series A warrants to purchase 31 shares of

common stock.

The placement agent subsequently converted its Series B Preferred Stock and received an aggregate of 2,229 shares

of common stock.

We received an aggregate of $557,205 from the placement agent for the exercise of the unit purchase option.

March 1, 2018, we closed an underwritten public offering of 20,000 shares of our common stock at a price to the public of $150.00

We received gross proceeds of approximately $3.0 million from the offering, before deducting underwriter discounts

and commissions and offering expenses payable by us.

Upon closing of the offering, we used $450,000 of the proceeds from the offering

to redeem 450 shares of Series D Convertible Preferred Stock (the “Series D Preferred Stock”), pursuant to a waiver

agreement with a holder of the Series D Preferred Stock (the “Series D Investor”), dated February 26, 2018.

of such offering, the conversion price for each of our Series C Preferred Stock and our Series D Preferred Stock was reduced from

$350.00 to $150.00 per share.

April 2, 2018, we closed an underwritten public offering of 57,143 shares of our common stock at a price to the public of $87.50

We received gross proceeds of approximately $5.0 million from the offering, before deducting underwriter discounts

and commissions and offering expenses payable by us.

Upon closing of the offering, we used $300,000 of the proceeds from the offering

to redeem 46,875 shares of our Series C Convertible Preferred Stock (the “Series C Preferred Stock”) held by the Series

D Investor, pursuant to another waiver agreement with the Series D Investor, dated March 28, 2018.

As a result of such offering,

the conversion price for each of our Series B Convertible Preferred Stock (the “Series B Preferred Stock”), our Series

C Preferred Stock and our Series D Preferred Stock was reduced to $87.50 per share.

July 3, 2018, we closed an underwritten public offering of (i) 10,851,417 common units, with each common unit being comprised

of one fiftieth share of our common stock, and one Series D Warrant to purchase one fiftieth share of common stock, (ii) 22,481,916

pre-funded units, with each pre-funded unit being comprised of one pre-funded warrant to purchase one fiftieth share of common

stock and one Series D Warrant, and (iii) additional Series D Warrants to purchase 100,000 shares of common stock pursuant to

the underwriter’s option.

We received net proceeds from the offering and the exercise of the underwriter’s option

to purchase additional Series D Warrants to purchase 100,000 shares of common stock of approximately $8.7 million, excluding the

proceeds, if any, from the exercise of the Series D Warrants and the pre-funded warrants sold in the offering, and after deducting

underwriting discounts and commissions and payment of other estimated expenses associated with the offering that are payable by

We used $2,264,269 of the net proceeds of the offering to redeem 306,917 shares of Series C Preferred Stock and 300 shares

of Series D Preferred Stock held by the Series D Investor.

As a result of such offering, the conversion price of the outstanding

shares of the Series B Preferred Stock and the Series C Preferred Stock was further reduced to $15.00 per share, effective as

of June 29, 2018.

Therefore, in order to fund our operations until such time that

we can generate substantial revenues, we may need to raise additional funds.

April 8, 2019, we closed an underwritten public offering of 486,957 shares of our common stock at a price to the public of $5.00

19 unchanged sentences

estimated expenses associated with the offering that were payable by us.

Anti-Dilution

outstanding shares of Series B Preferred Stock and Series C Preferred Stock contain anti-dilution provisions that may result in

the reduction of the conversion price thereof in the future.

This feature may result in an indeterminate number of shares of common

stock being issued upon conversion of the Series B Preferred Stock or the Series C Preferred Stock.

Sales of additional shares

of common stock issuable upon conversion of the Series B Preferred Stock or Series C Preferred Stock as a result of anti-dilution

adjustments will dilute the interests of other security holders and may depress the price of our common stock.

Accordingly, we

may find it more difficult to raise additional equity capital while any of our Series B Preferred Stock or Series C Preferred

Stock is outstanding.

As of March 8, 2020, 17,303 shares of Series B Preferred Stock and 26,558 shares of Series C Preferred Stock

were outstanding.

June 5, 2020, we closed an underwritten public offering of (i) 7,635,800 Units, with each Unit being comprised of one share of

our common stock, par value $0.0001 per share, and one Series F warrant to purchase one share of common stock, and (ii) 14,586,400

Pre-Funded Units, with each Pre-Funded Unit being comprised of one Pre-Funded Warrant to purchase one share of common stock and

one Series F Warrant.

In connection with this public offering, the underwriter exercised the option practically in full, for 3,333,300

shares of common stock and 3,333,300 Series F Warrants.

The offering price to the public was $0.45 per Unit and $0.449 per Pre-Funded

Our net proceeds from the offering and the exercise of the underwriter’s over-allotment option were approximately

$10.7 million, after deducting underwriting discounts and commissions and payment of other estimated expenses associated with

the offering, but excluding the proceeds, if any, from the exercise of Series F Warrants and the Pre-Funded Warrants sold in the

July 28, 2020, we entered into a Sales Agreement with A.G.P.

in connection with the ATM Facility.

Any shares to be offered and

sold under the Sales Agreement will be issued and sold pursuant to the Company’s Registration Statement on Form S-3 (File

333-223130), filed with the SEC on February 21, 2018 and the prospectus supplement thereto filed with the SEC on July 28,

2020, by methods deemed to be an “at the market offering”

as defined in Rule 415(a)(4) promulgated under the Securities

Act of 1933, as amended, or if specified by us, by any other method permitted by law.

On January 11, 2021, we increased the aggregate

amount of our shares of common stock that may be sold under the Sales Agreement from $9,300,000 to $10,382,954, and, as a result,

utilized and sold the maximum amount allowable under the ATM Facility, which resulted in an aggregate amount of $10,381,958.

February 8, 2021, we closed an underwritten public offering of 29,032,258 units, with each such unit being comprised of one share

of our common stock, par value $0.0001 per share, and one Series G Warrant to purchase one-half of one share of common stock.

The offering price to the public was $0.62 per unit.

The Series G Warrants were immediately exercisable at a price of $0.682 per

share, subject to adjustment in certain circumstances, and expire five years from the date of issuance.

We also granted the underwriter

of the offering an option to purchase an additional 4,354,838 shares of common stock and Series G Warrants to purchase 2,177,419

shares of common stock, which the underwriter exercised in full.

In connection with the offering, we granted to the underwriter

a compensation warrant to purchase up to 1,669,355 shares of common stock with an exercise price of $0.682 per share and which

are exercisable for five years from February 3, 2021, the date of effectiveness of the registration statement filed in connection

with the offering.

Our net proceeds from the offering, after giving effect to the exercise of the underwriter’s over-allotment

option, were approximately $18.9 million, after deducting underwriting discounts and commissions and payment of other estimated

expenses associated with the offering, but excluding the proceeds, if any, from the exercise of Series G Warrants sold in the

February 3, 2021, we entered into a Distribution Agreement with three China-based partners and on the same day, we entered into

an investment transaction with QIDI, which included (i) an SPA, pursuant to which QIDI agreed to invest $900,000 in exchange for

shares of our common stock at a purchase price of $0.6708 per share, and (ii) an IRA, whereby QIDI was provided certain customary

registration rights, including a commitment by us to file a registration statement with the SEC on Form S-1 or Form S-3 and have

such registration statement become effective not later than 150 days following the closing of the transactions under the SPA.

The transaction closed on February 5, 2021.

months ended December 31, 2020 compared to the twelve months ended December 31, 2019

3 unchanged sentences

expenditures and general working capital.

the twelve months ended December 31, 2019, net cash used in our operating activities increased by $2,204,000 to $9,810,000, from

the twelve months ended December 31, 2020, net cash used in our operating activities decreased by $729,000 to $9,081,000, from

$9,810,000 during the same period in 2019.

The primary reason for the increase in cash used in our operating activities was an

increase of payments for third party related expenses and for professional services of $1,571,000 (primarily due to production

related payments, payments related to IDE application process and a settlement payment made to a former service provider pursuant

to a settlement agreement), an increase of $717,000 in salary and bonus payments from $4,973,000 in the twelve months ended December

31, 2018 to $5,690,000 during the same period in 2019, offset by an increase of $84,000 in payments received from customers to

$3,603,000 during the twelve months ended December 31, 2019, from $3,519,000 during the same period in 2018.

The primary reason for the decrease in cash used in our operating activities was a

decrease of $1,293,000 in payments for third party related expenses and for professional services (primarily due to production

related payments and payments related to IDE application process), offset, in part, by an increase of $408,000 in salary and bonus

payments from $5,690,000 in the twelve months ended December 31, 2019 to $6,098,000 during the same period in 2020 and a decrease

of $156,000 in payments received from customers to $3,447,000 during the twelve months ended December 31, 2020, from $3,603,000

during the same period in 2019.

used by our investing activities was $187,000 during the twelve months ended December 31, 2020 compared to $387,000 during the

twelve months ended December 31, 2018 resulting primarily from purchases related to upgrades made to our production facilities

and our information technology infrastructure.

provided by financing activities for the twelve months ended December 31, 2019 was $6,335,000 compared to $13,370,000 during the

same period in 2018.

twelve months ended December 31, 2019.

The primary reasons for the decrease in cash used by our investing activities was a decrease

of $218,000 in net payments made for purchase of property, plant and equipment to $66,000 during the twelve months ended December

31, 2020, from $284,000 during the same period in 2019, offset, in part, by an increase of $18,000 in cash deposited to employee

funds, to $121,000 during the twelve months ended December 31, 2020, from $103,000 during the same period in 2019.

provided by financing activities for the twelve months December 31, 2020 was $16,395,000, compared to $6,335,000 during the same

period in 2019.

The principal sources of the cash provided by financing activities during the twelve months ended December 31,

2020 were our June 2020 public offering of common stock, pre-funded warrants and warrants, the subsequent exercise of the pre-funded

warrants sold in the offering, as well as exercise of warrants F and Unit Purchase Options, that resulted in approximately $12,169,000

of aggregate net proceeds, and funds received from our ATM Facility that resulted in approximately $ 4,126,000 of aggregate net

The principal source of the cash provided by financing activities during the twelve months ended December 31, 2019,

31, 2019, was the funds received from our September 2019 public offering of common stock, pre-funded warrants and warrants, as

well as the subsequent exercise of the pre-funded warrants sold in the offering, that resulted in approximately $4,289,000 of

aggregate net proceeds, and funds received from our April 2019 public offering of common stock that resulted in approximately

$2,046,000 of aggregate net proceeds.

The principal source of the cash provided by financing activities during the twelve months

ended December 31, 2018, was the funds received from our July 2018 public offering of common stock, pre-funded warrants and warrants,

as well as the subsequent exercise of the pre-funded warrants sold in the offering, that resulted in approximately $8,885,000

of aggregate net proceeds, funds received from our April 2018 public offering of common stock that resulted in approximately $4,439,000

of aggregate net proceeds.

and the funds received from our March 2018 public offering of common stock that resulted in approximately

$3,060,000 of aggregate net proceeds, offset by a redemption of Series C and Series D Preferred Stock from the proceeds of the

offering in an aggregate amount of $3,014,000.

was the funds received from our December 2019 public offering of common stock, pre-funded warrants and warrants, as well as the

subsequent exercise of the pre-funded warrants sold in the offering, that resulted in approximately $4,289,000 of aggregate net

proceeds, and funds received from our April 2019 public offering of common stock that resulted in approximately $2,046,000 of

aggregate net proceeds.

of December 31, 2020, our current assets exceeded our current liabilities by a multiple of 4.1.

Current assets decreased by $3,609,000

Current assets increased by $7,529,000

during the period and current liabilities increased by $590,000 during the period.

As a result, our working capital decreased

As a result, our working capital increased

by $6,939,000 to $11,634,000 as of December 31, 2020.

39 unchanged sentences

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 5. Market for Registrant’s Common Equity