What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2024-03-05 compared with 2023-03-30 · 636 added, 1422 removed, 500 unchanged (80% of the section changed)

34 unchanged sentences

Directors, Executive Officers and Corporate Governance.

Officers and Directors

following table sets forth information regarding our executive officers and the members of our board of directors.

Chief Executive Officer and Director

Financial Officer, Chief Administrative Officer, Secretary and Treasurer

Operating Officer

Manager of North America and VP of Global Marketing

Berman (1)(2)

Stuka (1)(2)(3)

of the Board of Directors

Kester (1)(3)

of our audit committee

of our nominating and corporate governance committee

of our compensation committee

directors hold office until the earlier of their death, resignation or removal by stockholders or until their successors have been qualified.

Our directors are divided into three classes.

Paul Stuka and Gary Roubin are our Class 1 directors, with their terms of office expiring

at our 2024 annual meeting of stockholders.

Michael Berman is our Class 2 director, with his term of office expiring at our 2025 annual

meeting of stockholders.

Marvin Slosman, Thomas J.

Kester and Kathryn Arnold are our Class 3 directors, with their terms of expiring

at our 2023 annual meeting of stockholders.

At each annual meeting of stockholders, directors elected to succeed those directors whose

terms expire shall be elected for a term of office to expire at the third succeeding annual meeting of stockholders after their election,

with each director to hold office until his or her successor shall have been duly elected and qualified.

officers hold office until the earlier of their death, resignation or removal by our board of directors or until their successors have

been selected.

They serve at the pleasure of our board of directors.

Slosman has served as our president, chief executive officer and director since January 1, 2020.

Slosman has served as chief

operating officer for MEDCURA Inc.

from May 2019 to December 2019.

From September 2017 to September 2019, Mr.

Slosman served as a Business

Consultant, overseeing international commercial strategy and market development, at Integra Life Sciences, a leading innovator in orthopedic

extremity surgery, neurosurgery, and reconstructive and general surgery.

From 2010 to 2014 Mr.

Slosman served as President of Itamar

Medical, Inc., a medical technology company focused on cardiovascular and sleep diagnostics.

Slosman also served as chief executive

officer of Ovalum Vascular Ltd.

from 2008 to 2010.

Slosman’s qualifications to serve on the board of directors of the Company

include his significant experience in senior management positions of leading medical device companies.

Shore has served as our chief financial officer, secretary and treasurer since March 31, 2011 and as our chief administrative officer

since May 3, 2013.

In addition, from November 10, 2010 through March 31, 2011, Mr.

Shore served as InspireMD Ltd.’s vice president

of business development.

Shore has vast experience in financial management in the United States, Europe and Israel for companies

such as Pfizer Pharmaceuticals, Bristol Myers Squibb and General Electric.

His experience includes raising capital both in the private

and public markets.

Shore graduated with honors and received a B.Sc.

in Finance from Pennsylvania State University and an M.B.A.

from George Washington University.

Tommasoli has served as our Chief Operating Officer since March 19, 2023.

Tommasoli’s appointment as Chief Operating

Officer, he served as our Senior Vice President of Global Sales and Marketing since November 2020 bringing over two decades of life sciences

industry experience to the Company.

Prior to joining the Company, Mr.

Tommasoli held commercial leadership positions at Integra LifeSciences,

a medical device manufacturing company that manufactures products for skin regeneration, neurosurgery, reconstructive and general surgery,

from 2011 to 2020, serving as the Senior Director of Indirect Markets from January 2017 to October 2020, as Director of Sales for Specialty

Surgical Solutions Europe from June 2014 to December 2016 and as Director of Sales for Neurosurgery EMEA from July 2011 to June 2014.

Prior to joining Integra, Mr.

Tommasoli was a Managing Partner at Alticare, an independent company focusing on start-ups and growth companies

in the medtech business from 2009 to 2011 and was the Director of St.

Jude Medical Neuromodulation division in France from 2007 to 2009.

Tommasoli has vast experience in commercializing innovative medical technology solutions that improve and advance standard of care.

Tommasoli received his B.A.

in nuclear engineering from Bologna University, Italy and his M.B.A.

from HEC Paris, France.

Gleason has served as our general manager of North America and vice president of global marketing since March 1, 2023.

Prior to joining

Gleason served as served as vice president of sales, vascular interventions at Surmodics from 2021.

Before that, from 2019 to

2021, he served as senior director, US marketing at Edwards Life Sciences (NYSE:

EW), a developer of artificial heart valve and hemodynamic

monitoring technologies, and, before that, from 2017 to 2019 as, chief commercial officer at Nuvaira, Inc., a privately held developer

of COPD therapies that preserve patient lung health.

Earlier in his career, Mr.

Gleason held sales and marketing leadership roles at

Cordis, a Cardinal Health company (NYSE:

CAH) from 2015 to 2016, Trivascular Technologies (part of Endologix) from 2012 to 2015, and

Abbott Vascular (NYSE:

ABT) from 2007 to 2010, where he launched the second FDA approved carotid stent system.

Gleason received a

Bachelor of Science, Engineering Science and Mechanics from Virginia Polytechnic Institute and State University and a Master of Business

Administration from the University of Maryland Smith School of Business.

Berman has served as our director since February 7, 2013.

Berman is a medical device entrepreneur who has worked with high-potential

development and early-stage commercial companies since 2014.

From 2005 to 2012, Mr.

Berman was a co-founder and the chairman of BridgePoint

Medical, Inc., which developed technology to treat coronary and peripheral vascular chronic total occlusions and which was sold to Boston

Berman was also a member of the board of Lutonix, Inc.

from 2007 until 2011, when the company was sold to C.R.

From 2011 to 2018, Mr.

Berman served as a co-founder and director of Rebiotix Inc., a company developing an innovative treatment

for C Diff colitis.

Rebiotix was sold to Ferring Pharmaceuticals in 2018.

From 2014 till 2018 Mr.

Berman served as a director of Mazor

Robotics, a company pioneering Spinal Robotic Surgery.

Mazor was sold to Medtronic in 2018.

Berman has served (i) since 2011 as an

advisor to, and since 2012 as a director of, Cardiosonic, Inc., a company developing a system for hypertension reduction via renal denervation,

(ii) since 2005 as a director of PharmaCentra, LLC, which creates customizable marketing programs that help pharmaceutical companies

communicate with physicians and patients, (iii) since 2018 as a Director of STMedical, a medical device company that has developed a

temporary stent for the treatment of chronic sinusitis, (iv) since 2019 as a director of CardiacSense Inc, a medical device company that

has developed a smart watch vital sign monitor, (v) since 2017 as a Director of Owlytics Healthcare, (vi) since 2013 as a Director of

ClearCut Inc., a medical device company that has developed an MRI system for tumor margin assessment, (vii) since 2013 as a director

of PulmOne Ltd., a medical device company developing an innovative Pulmonary Function Testing system, (viii) since 2019 as a director

of QArt, a medical device company, (ix) since 2014 as a venture partner at RiverVest Ventures.

(x) since 2017 as a Director of Truleaf

Medical and (xi) since 2022 as a Director of Kedma Solar Ltd.

Berman brings to the board his extensive executive and entrepreneurial

experiences in the field of medical devices and vascular intervention, which should assist in strengthening and advancing our strategic

Stuka has served as a director since August 8, 2011 and has served as our chairman since June 2, 2017.

Stuka has served as the

managing member of Osiris Partners, LLC, an investment fund, since 2000.

Prior to forming Osiris Partners, LLC, Mr.

Stuka, with 35 years

of experience in the investment industry, was a managing director of Longwood Partners, managing small cap institutional accounts.

Stuka joined State Street Research and Management as manager of its Market Neutral and Mid Cap Growth Funds.

From 1986 to 1994,

Stuka served as the general partner of Stuka Associates, where he managed a U.S.-based investment partnership.

Stuka began his

career in 1980 as an analyst at Fidelity Management and Research.

As an analyst, Mr.

Stuka followed a wide array of industries including

healthcare, energy, transportation, and lodging and gaming.

Early in his career he became the assistant portfolio manager for three Fidelity

Funds, including the Select Healthcare Fund which was recognized as the top performing fund in the United States for the five-year period

ending December 31, 1985.

From 2013 to 2022 Mr.

Stuka served as a director of Caliber Imaging & Diagnostics, Inc.

(formerly Lucid,

Stuka’s qualifications to serve on the board include his significant strategic and business insight from his years of

experience investing in the healthcare industry.

Kester has served as a director since September 6, 2016.

Kester has been serving as the chief financial officer of Kester

Search Group, LLC Inc., a private executive search firm specializing in sales force placement for medical, dental and diagnostic device

companies, since October 2014.

From 2004 to 2010, Mr.

Kester served as a director of Orthofix International, NV (NASDAQ:

OFIX), a global

medical device company.

From 2004 till 2019 Mr.

Kester served as a director of Conestee Foundation Inc, a not for profit organization

that developed a 400 acre Nature Preserve in the center of Greenville County, SC .

Kester has served (i) since 2003 as a director

of Upstate forever, a not for profit in Greenville, SC focused on protecting special places in the 10 county upstate region of South

Carolina and promoting sustainable development, (ii) since 2021 as a director of South Carolina Environmental Law Project, a not for

profit law firm representing clients on environmental issues.

Kester’s experience includes 28 years from 1974 until 2002 at

KPMG LLP, including 18 years as an audit partner, advising public and private companies in connection with annual audit and financings.

Kester’s qualifications to serve on the board include his significant strategic and business insight from his years of experience

auditing global companies and serving on the boards of several public and not-for-profit organizations.

Kester received his B.S.

in mechanical engineering from Cornell University and an M.B.A.

from Harvard University.

has served as a director since October 13, 2020.

Roubin cofounded Essential Medical Inc.

in 2010, which has had

success in bringing a large bore vascular closure device to world markets and was recently acquired by Teleflex Inc.

From 2002 to 2003,

Roubin served as Chief Medical Officer of the Medicines Company during the release of its Angiomax product.

From 2003 to 2012, Dr.

Roubin served as Department Chairman and Chief of Service of the Lenox Hill Hospital Cardiac and Vascular program in New York.

to 1997, he served as Chief of Interventional Cardiology at the University of Alabama at Birmingham, to which he joined in 1989 as Professor

of Medicine and Radiology and Director of the Cardiac Catheterization Laboratories and Interventional Cardiology Section at the University

Roubin played a pivotal role in the success of Mednova Inc., which was acquired by Abbott Vascular, resulting

in the introduction and marketing in the U.S.

of the top selling carotid embolic protection system (NAV6) and stent system (XACT).

1987, he developed and placed the world’s first balloon expandable coronary stent.

Roubin joined Andreas Gruentzig

at Emory University to continue his post-doctoral research.

He is also acknowledged for the development of coronary stenting and the

first FDA-approved coronary stent.

Roubin received his M.D.

from the University of Queensland medical school and his Ph.D.

Roubin is qualified to serve on the board given that he is an internationally renowned interventional cardiologist recognized

for his pioneering work in carotid stenting and embolic and protection devices.

He is also acknowledged for the development of coronary

stenting and the first FDA-approved coronary stent.

Arnold has served as our director since May 10, 2021.

Arnold is the Founder and CEO of SPRIG Consulting, a strategic marketing

consulting firm with over a decade of success in the medical space.

Prior to founding SPRIG, Ms.

Arnold held sales and marketing management

roles with Guidant Corporation (acquired by Abbott Laboratories and Boston Scientific) and Kensey Nash Corporation (acquired by Spectranetics

Corporation / Royal Philips).

Additionally, Ms.

Arnold is an adjunct faculty member at the Kellogg School of Management at Northwestern

University where she teaches a course specific to medical product commercialization and financing.

Arnold received a bachelor of

arts in environmental science from the University of Vermont and a master’s degree from the Kellogg School of Management at Northwestern

Diversity Matrix

table below provides certain information regarding the diversity of our board of directors as of the date set forth below.

Board Diversity Matrix (As of March 28, 2023)

Total Number of Directors

Did Not Disclose Gender

Gender Identity

Demographic Background

African American or Black

Alaskan Native or Native American

Hispanic or Latinx

Native Hawaiian or Pacific Islander

Two or More Races or Ethnicities

Did Not Disclose Demographic Background

Relationships

have no family relationships amongst our directors and executive officers.

board of directors has established an audit committee, a nominating and corporate governance committee and a compensation committee,

each of which has the composition and responsibilities described below.

Our audit committee is currently comprised of Messrs.

Berman, Stuka and Kester, each of whom our board has determined

to be financially literate and qualify as an independent director as defined in the Nasdaq Listing Rules and Rule 10A-3 promulgated under

the Exchange Act.

Kester is the chairman of our audit committee and qualifies as a financial expert, as defined in Item 407(d)(5)(ii)

of Regulation S-K.

The audit committee’s duties are to recommend to our board of directors the engagement of independent auditors

to audit our financial statements and to review our accounting and auditing principles.

The audit committee will review the scope, timing

and fees for the annual audit and the results of audit examinations performed by the internal auditors and independent public accountants,

including their recommendations to improve the system of accounting and internal controls.

The audit committee operates under a formal

charter adopted by the board of directors that governs its duties and conduct.

Copies of the charter can be obtained free of charge from

the Company’s web site, www.inspiremd.com, by contacting the Company.

and Corporate Governance Committee .

Our nominating and corporate governance committee is currently comprised of Messrs.

Stuka, each of whom qualify as an independent director under as defined in the Nasdaq Listing Rules and Rule 10A-3 promulgated under

the Exchange Act.

Berman is the chairman of our nominating and corporate governance committee.

The nominating and corporate governance

committee identifies and recommends to our board of directors individuals qualified to be director nominees.

In addition, the nominating

and corporate governance committee recommends to our board of directors the members and chairman of each board committee who will periodically

review and assess our code of business conduct and ethics and our corporate governance guidelines.

The nominating and corporate governance

committee also makes recommendations for changes to our code of business conduct and ethics and our corporate governance guidelines to

our board of directors, reviews any other matters related to our corporate governance and oversees the evaluation of our board of directors

and our management.

The nominating and corporate governance committee operates under a formal charter adopted by the board of directors

that governs its duties and conduct.

Copies of the charter can be obtained free of charge from the Company’s web site, www.inspiremd.com,

by contacting the Company.

Our compensation committee is currently comprised of Messrs.

Stuka and Kester and Ms.

Arnold, each of whom qualify

as an independent director under as defined in the Nasdaq Listing Rules and Rule 10A-3 promulgated under the Exchange Act.

is the chairman of our compensation committee.

The compensation committee reviews and approves our salary and benefits policies, including

compensation of executive officers and directors.

The compensation committee also administers our stock option plans and recommends and

approves grants of stock options under such plans.

The compensation committee operates under a formal charter adopted by the board of

directors that governs its duties and conduct.

Copies of the charter can be obtained free of charge from the Company’s web site,

www.inspiremd.com, by contacting the Company.

have adopted a code of ethics and business conduct that applies to our officers, directors and employees, including our principal executive

2 unchanged sentences

officers and directors, on this website within four business days following the date of such amendment or waiver.

remaining information required by this Item 10 will be included in our definitive Proxy Statement for the 2024 Annual Meeting of Stockholders

and is incorporated herein by reference.

Executive Compensation.

Compensation Table

table below sets forth the compensation earned by our named executive officers for the twelve-month period ended December 31, 2022 and

Name and Principal Position

Marvin Slosman

President and Chief Executive Officer

164,698 (4)(6)

Chief Financial Officer, Secretary and Treasurer

164,257 (4)(6)

Andrea Tommasoli (8)

226,837 (9)(10)

71,193 (4)(10)(11)

Chief Operating Officer

46,572 (4)(10)(11)

awards of stock, the aggregate grant date fair value is computed in accordance with FASB ASC Topic 718.

Fair value is based on the

Black-Scholes option pricing model using the fair value of the underlying shares at the measurement date.

as of July 1, 2021, Mr.

Slosman’s annual base salary was increased to $420,000.

as of July 1, 2022, Mr.

Slosman’s annual base salary was increased to $445,000.

bonus awards for the 2021 calendar year were approved by the compensation committee in January 2022.

Cash bonus awards for the 2022

calendar year were approved by the compensation committee in January 2023.

Slosman’s other compensation for the twelve months ended December 31, 2022 and 2021 consisted of benefits related to health

as of January 1, 2022, Mr.

Shore’s annualized base salary was increased to NIS 1,073,280.

Compensation amounts received in

currency have been converted into U.S.

dollars using the average exchange rate for the applicable period, except for bonus

amounts which have been converted into U.S.

dollars using 3.519 NIS per dollar which was the exchange rate as of December 31, 2022.

The average exchange rate for the twelve month period ended December 31, 2022 and 2021 were 3.359 NIS per dollar and 3.229 NIS per

dollar, respectively.

Shore’s other compensation consisted solely of benefits in the twelve months ended

December 31, 2022 and 2021.

In each of the periods reported, Mr.

Shore’s benefits included

our contributions to his severance, pension, vocational studies and disability funds, an

annual recreation payment, a company car or car allowance, cell phone and a daily food allowance.

Tommasoli was appointed Chief Operating Officer in March 2023.

Amounts presented are during Mr.

Tommasoli’s tenure as Senior

Vice President of Global Sales and Marketing.

as of January 1, 2022, Mr.

Tommasoli’ s annualized base salary was increased to Euro 215,256.

amounts received in non-U.S.

currency have been converted into U.S.

dollars using the average exchange rate for the applicable period,

except for bonus amounts which have been converted into U.S.

dollars using 1.073 Euro per dollar which was the exchange rate as of

December 31, 2022.

The average exchange rate for the twelve-month period ended December 31, 2022 and 2021 were 1.054 Euro per dollar

and 1.183 Euro per dollar, respectively.

consists of a cash bonus of $14,546 and sales commissions of $56,647 with respect to 2022 and a cash bonus of $21,599 and sales commissions

of $24,973 with respect to 2021.

Tommasoli’s other compensation consisted solely of benefits in the twelve months ended

December 31, 2022 and 2021.

In each of the periods reported, Mr.

Tommasoli’ s benefits

included our contributions to car allowance, retirement benefits, health insurance, provident

fund and other insurances typical in France (excluding social security charges for illness,

family allowance and retirement).

with Named Executive Officers

December 9, 2019, we entered into an Employment Agreement with Marvin Slosman, which was subsequently amended on December 31, 2019, November

8, 2021 and January 5, 2023 (as amended, the “Slosman Employment Agreement”), pursuant to which Mr.

Slosman was appointed

as our new chief executive officer and president.

Slosman’s term of employment commenced on January 1, 2020, was to remain

in effect for three years (the “Initial Employment Term”), unless earlier terminated, and was to be automatically renewed

for successive one-year terms after the Initial Employment Term.

We subsequently amended Mr.

Shore’s employment agreement to remove

that certain definitive term of his employment such that his employment agreement shall expire if and when terminated by either party

pursuant to the terms thereof.

Slosman was also appointed as a Class 3 director, effective January 1, 2020, with a term expiring

on the 2020 annual meeting of our stockholders.

consideration for his services as chief executive officer, Mr.

Slosman will be entitled to receive (i) an annual base salary, which as

of July 1, 2022 was increased to $445,000, less applicable payroll deductions and tax (“Base Salary”), which will be reviewed

by the Board on an annual basis for increase;

(ii) reimbursement of up to $50,000 for any reasonable and customary, documented out-of-pocket

relocation expenses actually incurred by Mr.

Slosman in 2019 or 2020 calendar years, in connection with his relocation to Europe;

annual performance bonuses in an amount up to 60% percent of the Base Salary, as may be in effect from time to time, for each calendar

year during his employment with us based on the extent to which performance criteria/financial results for the applicable year have been

and (iv) equity awards as of the date of the Slosman Employment Agreement that represent, in the aggregate, 5% of the Company’s

issued and outstanding common stock determined on a fully diluted basis as of the date of grant (the “Equity Awards”), with

75% of the Equity Awards being granted as restricted stock units and with the remaining 25% of the Equity Awards being granted as stock

options, all of which Equity Awards shall be outside of the 2013 Long-Term Incentive Plan and subject to terms and conditions of the

award agreements entered by Mr.

In addition, on or before December 31, 2020, Mr.

Slosman shall become eligible to receive an

additional grant of equity awards under the 2013 Long-Term Incentive Plan and the applicable award agreements up to 5% (including the

Equity Awards) of the Company’s actual outstanding shares of Common Stock on the date of grant, provided that the actual amount

of the grant shall be based on the achievement of certain performance/financial criteria as established by the Board after consultation

Slosman, in its reasonable discretion.

January 2022, the Compensation Committee approved a reimbursement of up to $50,000 for any reasonable and customary, documented out-of-pocket

relocation expenses actually incurred by Mr.

Slosman in the 2022 calendar years, in connection with his relocation to Europe, as well

as $62,500 in expenses on an annual basis for expenses relating to commuting expenses, health coverage and corporate and visa status

the event Mr.

Slosman voluntarily resigns without good reason, we may, in our sole discretion, shorten the notice period and determine

the date of termination without any obligation to pay Mr.

Slosman any additional compensation other than the accrued obligations and

without triggering a termination of Mr.

Slosman’s employment without cause.

In the event we terminate Mr.

Slosman’s employment

for cause or Mr.

Slosman voluntarily resigns without good reason, we shall have no further liability or obligation to Mr.

Slosman under

the Slosman Employment Agreement.

Notwithstanding the foregoing, in the event that this the Slosman Employment Agreement terminates,

we shall, subject to the execution and timely return by Mr.

Slosman of a release of claims, pay Mr.

Slosman cash payments totalling $100,000

in the aggregate, payable in equal instalments on our regular pay dates that occur during the period commencing on 60th day following

his employment termination date and ending on the last day of the Restricted Period (as defined below);

provided, however, that if, at

any time within the period commencing on the date that is 3 months prior to the termination of his employment agreement , we and a third

party execute a definitive, written, and binding agreement (a “Sale Agreement”) to enter into certain transactions described

therein that, if consummated, would constitute a change in control in us, then Mr.

Slosman’s termination shall be deemed a termination

by us without cause or for good reason, as of the date such Sale Agreement is executed, provided further that any amounts payable to

Slosman pursuant to such termination shall be reduced by any amounts previously paid to him upon expiration of the Slosman Employment

Agreement, termination by us for cause or voluntary resignation by Mr.

Slosman without good reason.

Slosman’s employment is terminated (i) by us without cause or (ii) by Mr.

Slosman for good reason, then we must pay Mr.

(a) a severance pay in an amount equal to twelve months of his then-current base salary, (b) his entire performance bonus for any calendar

year for which Mr.

Slosman has already worked the entire year but the bonus has yet to be paid, (c) a pro-rated performance bonus in

an amount equal to the target annual performance bonus to which Mr.

Slosman may have been entitled for the year in which the termination

occurs that he would have received had his employment not been terminated during such year.

In addition, 50% of all unvested stock options,

shares of restricted stock, restricted stock units, stock appreciation rights, or similar stock-based rights granted to Mr.

Slosman shall

vest and, if applicable, be immediately exercisable and any risk of forfeiture included in such restricted or other stock grants previously

Slosman shall immediately lapse, and Mr.

Slosman may exercise any outstanding stock options or stock appreciation rights

until the earlier of (x) the last date on which such stock options or stock appreciation rights could have been exercised pursuant to

the terms of the applicable award agreement, irrespective of Mr.

Slosman’s termination of employment;

and (y) the date that is

two years following his employment termination date.

have been a party to an employment agreement with Craig Shore since November 28, 2010.

On May 5, 2014, we entered into an amended and

restated employment agreement with Mr.

Shore, which was amended on January 5, 2015, July 25, 2016, March 25, 2019, August 14, 2020, November

4, 2021, January 17, 2022 and January 15, 2023 (as amended, the “Shore Employment Agreement”).

The Shore Employment Agreement

had an initial term that originally was to end on December 31, 2020, and was to automatically renew for additional one-year periods on

January 1st thereafter unless either party gave the other party written notice of its election not to extend such employment at least

six months prior to the next January 1st renewal date.

We subsequently amended the Shore Employment Agreement to remove that certain

definitive term of his employment such that his employment agreement shall expire if and when terminated by either party pursuant to

the terms thereof.

the terms of the Shore Employment Agreement, Mr.

Shore is entitled to an annual base salary, which as of January 1, 2023 was increased

to no less than NIS 93,912 per month (NIS 1,126,944 on an annualized basis).

Such amount may be reduced only as part of an overall cost

reduction program that affects all of our senior executives and does not disproportionately affect Mr.

Shore, so long as such reduction

does not reduce the base salary to a rate that is less than 90% of the amount set forth above (or 90% of the amount to which it has been

The base salary will be reviewed annually by our chief executive officer for increase (but not decrease, except as permitted

as part of an overall cost reduction program) as part of our annual compensation review.

Shore is also eligible to receive an annual

bonus in an amount equal to 60% of his then-annual salary upon the achievement of reasonable target objectives and performance goals,

to be determined by the board of directors in consultation with Mr.

Shore is eligible to receive the percentage of his annual

bonus corresponding to the percentage of his achievement of such target objectives and performance goals.

The annual bonus will be reviewed

annually by our chief executive officer for increase in the amount of the percentage of his then-base salary (but not decrease), as well

as the criteria and the goals, as part of our annual compensation review.

In addition, Mr.

Shore is eligible to receive such additional

bonus or incentive compensation as the board may establish from time to time in its sole discretion.

Shore will also be considered

for grants of equity awards each year as part of the board’s annual compensation review, which will be made at the sole discretion

of the board of directors.

Each grant will, with respect to any awards that are options, have an exercise price equal to the fair market

value of our common stock as of the date of grant, and will be subject to a three-year vesting period subject to Mr.

Shore’s continued

service with us, with one-third of each additional grant vesting equally on the first, second, and third anniversary of the date of grant

for such awards.

Shore’s employment is terminated upon his death or disability, by us without cause (as such term is defined in the Shore Employment

Agreement), or upon his resignation for “good reason” (as such term is defined in the Shore Employment Agreement), Mr.

will be entitled to receive, in addition to any amounts he is entitled to receive under the manager’s insurance policy:

unpaid base salary and accrued unpaid vacation or earned incentive compensation and the pro rata amount of any bonus plan incentive compensation

for the fiscal year of such termination (based on the number of business days he was actually employed by us during the fiscal year of

such termination and based on the percentage of the goals that he actually achieved under the bonus plan) that he would have received

had his employment not been terminated;

(ii) a one-time lump sum severance payment equal to 100% of his base salary, provided that he

executes a release relating to employment matters and the circumstances surrounding his termination in favor of us, our subsidiaries

and our officers, directors and related parties and agents, in a form reasonably acceptable to us at the time of such termination;

vesting of all unvested stock options, stock appreciation rights or similar stock-based rights granted to him and immediate lapse of

any risk of forfeiture included in restricted or other stock grants previously made to Mr.

(iv) an extension of the exercise period

of all vested stock options granted to Mr.

Shore until the earlier of (a) two years from the date of termination or (b) the latest date

that each stock option would otherwise expire by its original terms;

(v) to the fullest extent permitted by our then-current benefit

plans, continuation of health, dental, vision and life insurance coverage for the lesser of 12 months after termination or until Mr.

Shore obtains coverage from a new employer;

and (vi) reimbursement of up to $30,000 for executive outplacement services, subject to certain

restrictions.

The severance payment described in (ii) of the foregoing sentence upon Mr.

Shore’s death or disability will be reduced

by any payments received by Mr.

Shore pursuant to any of our employee welfare benefit plans providing for payments in the event of death

or disability.

If the Shore Employment Agreement is terminated by us for cause or by Mr.

Shore voluntarily, Mr.

Shore will only be entitled

to unpaid amounts owed to him (e.g., base salary, accrued vacation and earned incentive compensation through the date of such termination)

and whatever rights, if any, are available to him pursuant to our stock-based compensation plan or any award documents related to any

stock-based compensation.

Shore may terminate his employment for good reason by delivering a notice of termination to us 30 days in advance of the date of termination;

provided, however, that Mr.

Shore agreed to not terminate his employment for good reason until he has given us at least 30 days’

notice from which to cure the circumstances set forth in the notice of termination constituting good reason, and if such circumstances

are not cured by the 30th day, Mr.

Shore’s employment shall terminate on such date.

to terms contained in Mr.

Shore’s stock option and restricted stock award agreements, in the event of a change of control of our

company, the stock options and restricted stock granted to Mr.

Shore that were unvested will vest immediately upon such change of control,

in the case of stock options, if such stock options are not assumed or substituted by the surviving company.

we terminate Mr.

Shore’s employment without cause, Mr.

Shore will be entitled, under Israeli law, to severance payments equal to

his last month’s salary multiplied by the number of years Mr.

Shore has been employed with us.

In order to finance this obligation,

we make monthly contributions equal to 8.33% of Mr.

Shore’s salary to a severance payment fund.

The total amount accumulated in

Shore’s severance payment fund as of December 31, 2022 was $254,000, as adjusted for conversion from New Israeli Shekels to

However, if Mr.

Shore’s employment is terminated without cause, on account of a disability or upon his death, as

of December 31, 2022, Mr.

Shore would have been entitled to receive $308,000 in severance under Israeli law, thereby requiring us to

Shore $54,000, in addition to releasing the $254,000 in Mr.

Shore’s severance payment fund.

On the other hand, pursuant

to the Shore Employment Agreement, Mr.

Shore is entitled to the total amount contributed to and accumulated in his severance payment

fund in the event of the termination of his employment as a result of his voluntary resignation.

In addition, Mr.

Shore would be entitled

to receive his full severance payment under Israeli law, including the total amount contributed to and accumulated in his severance payment

fund, if he retires from our company at or after age 67.

are entitled to terminate Mr.

Shore’s employment immediately at any time for “cause” (as such term is defined in the

agreement and the Israeli Severance Payment Act 1963), upon which, after meeting certain requirements under the applicable law and recent

Israeli Labor court requirements, we believe we will have no further obligation to compensate Mr.

upon termination of Mr.

Shore’s employment for any reason, we will compensate him for all unused or previously uncompensated vacation

days accrued.

employment agreement also contains certain standard noncompetition, non-solicitation, confidentiality, and assignment of inventions requirements

Shore is also entitled to participate in or receive benefits under our social insurance and benefits plans, including but not limited

to our manager’s insurance policy and education fund, which are customary benefits provided to executive employees in Israel.

management insurance policy is a combination of severance savings (in accordance with Israeli law), defined contribution tax-qualified

pension savings and disability pension payments.

An education fund is a savings fund of pre-tax contributions to be used after a specified

period of time for advanced educational training and other permitted purposes, as set forth in the by-laws of the education fund.

will make periodic contributions to these insurance and social benefits plans based on certain percentages of Mr.

salary, including (i) 7.5% to the education fund and (ii) 15.83% to the manager’s insurance policy, of which 8.33% will be allocated

to severance pay, 5.5% to pension fund payments and up to 2.5% to disability pension payments.

Upon the termination of Mr.

employment for any reason other than for cause, Mr.

Shore will be entitled to receive the total amount contributed to and accumulated

in his manager insurance policy fund.

have been a party to an employment agreement with Mr.

Andrea Tommasoli since November 2, 2020 (the “Tommasoli Agreement”).

Tommasoli served as the Company’s Senior Vice President of Global Sales and Marketing since November 2020 until his promotion

to Chief Operating Officer, effective as of March 19, 2023.

Following his promotion Mr.

Tommasoli receives an annual base salary of 240,000

Euros (approximately $260,000) and is entitled to a yearly gross bonus of 35% of his base salary, which will be based on the Board’s

assessment of Mr.

Tommasoli’s individual performance and the overall performance of the Company.

Tommasoli’s remuneration

is subject to deduction of the employee’s share of social contributions, and CSG and CRDS.

The Tommasoli Agreement was entered

into for an indefinite period, and it may be terminated at any time by either the Company or Mr.

Tommasoli with a six months’ notice

however, no notice period applies in case of serious or gross misconduct.

The Tommasoli Agreement further provides for standard

benefits, such as reimbursement of business expenses, professional vehicle expenses and participation in the Company’s employee

benefit plans and programs.

The Tommasoli Agreement also contains certain standard confidentiality requirements.

of Control Agreements

to our forms of our restricted stock award agreement, stock option agreement, or restricted stock unit award agreement pursuant to our,

in the event of a change of control, any unvested awards shall become immediately vested.

do not currently have any plans providing for the payment of retirement benefits to our named executive officers or directors, other

than as described above and under “Agreements with Executive Officers” above.

do not currently have any change-of-control or severance agreements with any of our named executive officers or directors, other

than as described under “Agreements with Executive Officers” above.

In the event of the termination of employment of the

named executive officers, any and all unexercised stock options shall expire and no longer be exercisable after a specified time

following the date of the termination, other than as described under “Agreements with Executive Officers”

Equity Awards at December 31, 2022

following table shows information concerning unexercised options and unvested shares of restricted stock outstanding as of December 31,

2022 for each of our named executive officers.

Option Awards

unexercisable

Option exercise price ($)

Option expiration date

Marvin Slosman

Andrea Tommasoli

options vest annually, with one vesting remaining on January 2, 2023.

restricted stock units (RSUs) vest annually, with one vesting remaining on January 2, 2023.In case of the holders termination of

services for any reason other than by the Company for cause, the Company shall convert the vested RSUs into the number of whole shares

of Common Stock equal to the number of vested RSUs and shall deliver them to the holder.

options vest annually, with one vesting remaining on August 31, 2023.

RSUs vest annually, with one vesting remaining on August 31, 2023.

options vest annually, with one-half vesting on each of April 19, 2023, and April 19, 2024.

options vest annually, with one-half vesting on each of October 13, 2023, and October 13, 2024.

RSUs vest annually, with one-half vesting on each of October 13, 2023, and October 13, 2024.

shares of restricted stock vest annually, with one vesting remaining on August 31, 2023.

options vest annually, with one-half vesting on each of November 10, 2023, and November 10, 2024.

shares of restricted stock vest annually, with one-half vesting on each of November 10, 2023, and November 10, 2024.

These options vest annually, with one vesting remaining on November 2,

These shares of restricted stock vest annually, with

one vesting remaining November 2, 2023.

These shares of restricted stock vest annually, with one-half vesting on each of October 3, 2023, and October 3,

Exercises and Stock Vested

were no stock options exercised by our named executive officers during the twelve months ended December 31, 2022.

UMBRELLA Option Plan

March 28, 2011, our board of directors and stockholders adopted and approved the InspireMD, Inc.

2011 UMBRELLA Option Plan, which was

subsequently amended on October 31, 2011 and December 21, 2012.

Under the InspireMD, Inc.

2011 UMBRELLA Option Plan, we have reserved

13 shares of our common stock as awards to the employees, consultants, and service providers to InspireMD, Inc.

and its subsidiaries

and affiliates worldwide.

The InspireMD, Inc.

2011 UMBRELLA Option Plan is administered by our compensation committee.

The InspireMD,

2011 UMBRELLA Option Plan has expired on March 27, 2021.

We have no shares of common stock available for future issuance under our

2011 UMBRELLA Option Plan.

Long-Term Incentive Plan

December 16, 2013, our stockholders approved the InspireMD, Inc.

2013 Long-Term Incentive Plan, which was adopted by our board of directors

on October 25, 2013.

purpose of the InspireMD, Inc.

2013 Long-Term Incentive Plan is to provide an incentive to attract and retain employees, officers, consultants,

directors, and service providers whose services are considered valuable, to encourage a sense of proprietorship and to stimulate an active

interest of such persons in our development and financial success.

The InspireMD, Inc.

2013 Long-Term Incentive Plan provides for the

granting of incentive stock options, nonqualified stock options, stock appreciation rights, restricted stock, restricted stock units,

performance awards, dividend equivalent rights, and other awards, which may be granted singly, in combination, or in tandem.

The InspireMD,

2013 Long-Term Incentive Plan is administered by our compensation committee.

InspireMD, Inc.

2013 Long-Term Incentive Plan is intended to serve as an “umbrella” plan for us and our subsidiaries worldwide.

Therefore, if so required, appendices may be added to the InspireMD, Inc.

2013 Long-Term Incentive Plan in order to accommodate local

regulations that do not correspond to the scope of the InspireMD, Inc.

2013 Long-Term Incentive Plan.

Attached as Appendix A to the InspireMD,

2013 Long-Term Incentive Plan is the InspireMD, Inc.

2013 Employee Stock Incentive Plan, for the purpose of making grants of stock

options, restricted stock, and other stock incentive awards pursuant to Sections 102 and 3(i) of the Israeli Income Tax Ordinance (New

Version), 1961 to Israeli employees and officers and any other service providers or control holders of us who are subject to Israeli

the InspireMD, Inc.

2013 Long-Term Incentive Plan was adopted, a total of 11 shares of common stock were reserved for awards under the

InspireMD, Inc.

2013 Long-Term Incentive Plan.

September 9, 2015, our stockholders approved an amendment to the InspireMD, Inc.

2013 Long-Term Incentive Plan to increase the number

of shares of common stock available for issuance pursuant to awards under the InspireMD, Inc.

2013 Long-Term Incentive Plan by 11 shares

of common stock, to a total of 22 shares of common stock.

May 24, 2016, our stockholders approved the second amendment to the InspireMD, Inc.

2013 Long-Term Incentive Plan to increase the number

of shares of common stock available for issuance pursuant to awards under the InspireMD, Inc.

2013 Long-Term Incentive Plan by 229 shares

of common stock, to a total of 251 shares of common stock.

September 28, 2016, our stockholders approved the third amendment to the InspireMD, Inc.

2013 Long-Term Incentive Plan to increase the

number of shares of common stock available for issuance pursuant to awards under the InspireMD, Inc.

2013 Long-Term Incentive Plan by

144 shares of common stock, to a total of 395 shares of common stock.

October 24, 2018, our stockholders approved the fourth amendment to the InspireMD, Inc.

2013 Long-Term Incentive Plan to (i) increase

the number of shares of common stock available for issuance pursuant to awards under such InspireMD, Inc.

2013 Long-Term Incentive Plan

by 178,000 shares, to a total of 178,395 shares of common stock, and (ii) remove the cap on the number of shares of common stock with

respect to which stock options or stock appreciation rights may be granted to certain executive officers of the Company during any calendar

March 21, 2019, our stockholders approved the fifth amendment to the InspireMD, Inc.

2013 Long-Term Incentive Plan to increase the total

number of shares of common stock issuable under the InspireMD, Inc.

2013 Long-Term Incentive Plan by 500,000 shares to a total of 678,395

shares of common stock

August 31, 2020, our stockholders approved the sixth amendment to the InspireMD, Inc.

2013 Long-Term Incentive Plan to increase the total

number of shares of common stock issuable under the InspireMD, Inc.

2013 Long-Term Incentive Plan by 6,500,000 shares to a total of 7,178,395

shares of common stock.

of December 31, 2022, we had 73,175 shares of common stock available for future issuance under our 2013 Long-Term Incentive Plan.

of March 28, 2023, we had 74,195 shares of common stock available for future issuance under our 2013 Long-Term Incentive Plan.

Equity Incentive Plan

September 30, 2021, at our 2021 annual meeting of stockholders, our stockholders approved our 2021 Equity Incentive Plan.

purpose of the InspireMD, Inc.

2021 Equity Incentive Plan is to provide an incentive to attract and retain employees, officers, consultants,

directors, and service providers whose services are considered valuable, to encourage a sense of proprietorship and to stimulate an active

interest of such persons in our development and financial success.

The InspireMD, Inc.

2021 Equity Incentive Plan provides for the granting

of incentive stock options, nonqualified stock options, stock appreciation rights, restricted stock, restricted stock units, performance

awards, dividend equivalent rights, and other awards, which may be granted singly, in combination, or in tandem.

The InspireMD, Inc.

2021 Equity Incentive Plan is administered by our compensation committee.

of December 31, 2022, we had 739,826 shares of common stock available for future issuance under our 2021 Equity Incentive Plan.

of March 28, 2023, we had 700,039 shares of common stock available for future issuance under our 2021 Equity Incentive Plan.

following table provides certain information concerning the compensation for services rendered in all capacities by each non-employee

director serving on our board during the year ended December 31, 2022, other than Mr.

Slosman, our Chief Executive Officer, who did not

receive additional compensation for his services as director and whose compensation is set forth in the Summary Compensation Table found

elsewhere in this Item 11.

Fees Earned or Paid in Cash ($)

Stock Awards ($)

Option Awards ($)

All Other Compensation ($)

Michael Berman

Campbell Rogers, M.D.(1)

Thomas Kester

Gary Roubin, M.D.

Kathryn Arnold

Rogers’ term as a director ended on August 31, 2022

the 2022 calendar year, our board approved the following compensation for our independent directors:

(i) a $48,000 stipend, payable quarterly

to the chairman of the board;

(ii) a $30,000 stipend, payable quarterly to the other directors;

(iii) annual committee chair compensation

of $12,000 for the chairman of the audit committee, $8,000 for the chairman of the compensation committee and $5,000 for the chairmen

of the nominating and corporate governance committee and the research and development committee;

and (iv) annual committee membership

compensation of $4,000 for members of the audit committee and the compensation committee and $2,000 for members of the nominating and

corporate governance committee and the research and development committee.

on January 1, 2023, directors may elect to receive all or a portion of their cash retainer amount in shares of our common stock under

the 2021 Equity Incentive Plan.

If a director makes that election, a stock award under the 2021 Plan will be paid quarterly on the first

day of each quarter (“Grant Dates”) and will become fully vested on the Grant Dates.

The stock award will be determined by

dividing (x) the product of the cash retainer amount and percentage of the cash retainer amount elected to be taken in shares by (y)

the “Fair Market Value” (as defined in the 2021 Equity Incentive Plan of a share on the Grant Dates.

If a director’s

service on the board terminates for any reasons prior to a Grant Date, he/she will receive a pro rata portion of shares or cash based

on the number of days served on the board during the relevant quarter.

and Officers’ Liability Insurance

currently have directors’ and officers’ liability insurance insuring our directors and officers against liability for acts

or omissions in their capacities as directors or officers, subject to certain exclusions.

Such insurance also insures us against losses

which we may incur in indemnifying our officers and directors.

In addition, we have entered into indemnification agreements with key

officers and directors and such persons shall also have indemnification rights under applicable laws, and our certificate of incorporation

information required by this Item 11 will be included in our definitive Proxy Statement for the 2024 Annual Meeting of Stockholders and

is incorporated herein by reference.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.

following table sets forth information with respect to the beneficial ownership of our common stock as of March 28, 2023 by:

person known by us to beneficially own more than 5.0% of our common stock;

of our directors;

of the named executive officers;

of our directors and executive officers as a group.

percentages of common stock beneficially owned are reported on the basis of regulations of the the SEC governing the determination of

beneficial ownership of securities.

Under the rules of the SEC, a person is deemed to be a beneficial owner of a security if that person

has or shares voting power, which includes the power to vote or to direct the voting of the security, or investment power, which includes

the power to dispose of or to direct the disposition of the security.

as indicated in the footnotes to this table, each beneficial owner named in the table below has sole voting and sole investment power

with respect to all shares beneficially owned and each person’s address is c/o InspireMD, Inc., 4 Menorat Hamaor St., Tel Aviv,

Israel 6744832.

As of March 28, 2023, we had 8,326,648 shares outstanding.

Name of Beneficial Owner

Number of Shares Beneficially Owned (1)

Percentage Beneficially Owned (1)

Officers and Directors

Marvin Slosman

Michael Berman

Thomas Kester

Gary Roubin, M.D.

Kathryn Arnold

Shane Gleason

Andrea Tommasoli

All directors and executive officers as a group (9 persons)

ownership of less than one percent.

of common stock beneficially owned and the respective percentages of beneficial ownership of common stock assumes the exercise of

all options, warrants and other securities convertible into common stock beneficially owned by such person or entity currently exercisable

or exercisable within 60 days of March 30, 2023.

Shares issuable pursuant to the exercise of stock options and warrants exercisable

within 60 days are deemed outstanding and held by the holder of such options or warrants for computing the percentage of outstanding

common stock beneficially owned by such person but are not deemed outstanding for computing the percentage of outstanding common

stock beneficially owned by any other person.

of (i) 6,392 shares of common stock, (ii) 12,159 Restricted Stock Units granted outside the plan that are currently exercisable or

exercisable within 60 days of March 30, 2023, (iii) 52,235 Restricted Stock Units granted under the 2013 Equity Incentive Plan, (iv)

48,856 Restricted Stock Units granted under the 2021 Equity Incentive Plan, (v) options to purchase 64,417 shares of common stock

that are currently exercisable or exercisable within 60 days of March 30, 2023, and (vi) 5,048 warrants to purchase shares of common

stock that are currently exercisable.

of (i) 54,902 shares of common stock, (ii) options to purchase 22,612 shares of common stock that are currently exercisable or exercisable

within 60 days of March 30, 2023, (iii) 15,085 shares of restricted stock granted under the Israeli Appendix of the InspireMD, Inc.

2013 Long-Term Incentive Plan, (iv) 48,652 shares of restricted stock granted under the 2021 Equity Incentive Plan, and (v) 224,219

shares of restricted stock granted to employees under the Israeli Appendix of the InspireMD, Inc.

2013 Long-Term Incentive Plan held

in trust, and with respect to which Mr.

Shore was granted a proxy with the right to vote such shares at his discretion.

of (i) 5,378 shares of common stock, (ii) warrants to purchase 2,688 shares of common stock that are currently exercisable or

exercisable within 60 days of March 30, 2023, and (iii) options to purchase 4,263 shares of common stock that are currently

exercisable or exercisable within 60 days of March 30, 2023.

Excludes 10,710 shares of restricted stock granted under the Israeli

Appendix of InspireMD, Inc.

2013 Long-Term Incentive Plan and 17,248 shares of restricted stock granted under the 2021 Equity

Incentive Plan held in trust, with respect to which the trustee has a proxy with the right to vote such shares at his discretion.

Stuka is the principal and managing member of Osiris Investment Partners, L.P., and, as such, has beneficial ownership of (A) 73,534

shares of common stock (B) personally holding (i) options to purchase 6,443 shares of common stock that are currently exercisable or

exercisable within 60 days of March 30, 2023, (ii) 5,310 shares of restricted stock granted under the InspireMD, Inc.

2013 Long-Term

Incentive Plan, (iii) 17,386 shares of restricted stock granted under the 2021 Equity Incentive Plan, and (iv) 19,607 shares of

common stock.

of (i) 19,077 shares of common stock, (ii) 8,780 shares of restricted stock granted under the InspireMD, Inc.

2013 Long-Term Incentive

Plan, (iii) 11,499 shares of restricted stock granted under the 2021 Equity Incentive Plan, (iv) 4,032 warrants to purchase shares

of common stock that are currently exercisable, and (v) options to purchase 4,260 shares of common stock that are currently exercisable

or exercisable within 60 days of March 28, 2023.

of (i) 147,385 shares of common stock, (ii) 5,310 shares of restricted stock granted under the InspireMD, Inc.

2013 Long-Term Incentive

Plan, (ii) 11,499 shares of restricted stock granted under the 2021 Equity Incentive Plan, and (iii) 22,880 warrants to purchase

shares of common stock that are currently exercisable and (iv) options to purchase 8,790 shares of common stock that are currently

exercisable or exercisable within 60 days of March 28, 2023.

of (i) 9,261 shares of common stock, (ii) 7,024 shares of restricted stock granted under the InspireMD, Inc.

2013 Long-Term Incentive

Plan, (iii) 11,499 shares of restricted stock granted under the 2021 Equity Incentive Plan, and (iv) options to purchase 4,258 shares

of common stock that are currently exercisable or exercisable within 60 days of March 28, 2023.

of (i) 31,825 shares of common stock, (ii) 6,034 shares of restricted stock granted under the InspireMD, Inc.

2013 Long-Term

Incentive Plan, (iii) 39,513 shares of restricted stock granted under the 2021 Equity Incentive Plan, and (iv) options to purchase

10,609 shares of common stock that are currently exercisable or exercisable within 60 days of March 28, 2023.

Compensation Plan Information

following table provides certain information as of December 31, 2022, with respect to our equity compensation plans under which our equity

securities are authorized for issuance:

Plan Category

Number of securities to be issued upon exercise of outstanding options, warrants and rights

Weighted-average exercise price of outstanding options, warrants and rights

Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))

Equity compensation plans approved by security holders

Equity compensation plans not approved by security holders

of awards made to individuals outside the InspireMD, Inc.

2011 UMBRELLA Option Plan, 2013 Long Term Incentive Plan and 2021 Equity

Incentive Plan, as described below:

January, 2020, we issued to Mr.

Marvin Slosman, our Chief Executive Officer, President and Director, 12,159 shares of restricted

stock and 4,053 shares of common stock, as inducement awards outside the Company’s 2013 Long-Term Incentive Plan.

November 3, 2020, we issued to Mr.

Andrea Tommasoli, our Senior Vice President of Global Sales and Marketing, options to purchase

6,035 shares of our common stock, as inducement awards outside the Company’s 2013 Long-Term Incentive Plan.

information required by this Item 12 will be included in our definitive Proxy Statement for the 2024 Annual Meeting of Stockholders and

is incorporated herein by reference.

Certain Relationships and Related Transactions, and Director Independence.

accordance with our audit committee charter, the audit committee is required to approve all related party transactions.

In general, the

audit committee will review any proposed transaction that has been identified as a related party transaction under Item 404 of Regulation

A related party includes (i) a director, director nominee or executive officer of us, (ii) a security holder known to be an owner

of more than 5% of our voting securities, (iii) an immediate family member of the foregoing or (iv) a corporation or other entity in

which any of the foregoing persons is an executive, principal or similar control person or in which such person has a 5% or greater beneficial

ownership interest.

were no related party transactions that are required to be disclosed pursuant to Regulation S-K promulgated under the Securities Act

of 1933, as amended.

board of directors has determined that Dr.

Roubin, Messrs.

Stuka, Berman and Kester, and Ms.

Arnold satisfy the requirement for independence

set out in Nasdaq Listing Rules and Rule 10A-3 promulgated under the Exchange Act.

In making its independence determinations, the board

of directors sought to identify and analyze all of the facts and circumstances relating to any relationship between a director, his or

her immediate family or affiliates and our company and our affiliates and did not rely on categorical standards other than those contained

in the rules referenced above.

information required by this Item 13 will be included in our definitive Proxy Statement for the 2024 Annual Meeting of Stockholders and

is incorporated herein by reference.

Principal Accountant Fees and Services.

fees billed for professional services provided to us by Kesselman & Kesselman, Certified Public Accountants (“Kesselman”),

a member of PricewaterhouseCoopers International Limited, for the years ended December 31, 2022 and 2021 are described below.

Audit Fees (1)

Audit – related fees

All other fees

billed us audit fees in the aggregate amount of $188,000 and $176,000 for the years ended December 31, 2022 and 2021, respectively.

fees relate to the audit of our annual financial statements and the review of our interim quarterly financial statements.

Audit-Related

billed us audit-related fees in the aggregate amount of $25,900 and $49,900 for the year ended December 31, 2022 and 2021, respectively.

The fees for the year ended December 31, 2022 mostly related to registration statement on Form S-3 filed with the SEC in June 2022.

fees for the year ended December 31, 2021 mostly related to registration statement on Form S-1 filed with the SEC in February 2021 and

to registration statement on Form S-3 filed with the SEC in April 2021.

billed us tax fees in the aggregate amount of $40,282 and $38,675 for the year ended December 31, 2022 and 2021, respectively.

fees relate to professional services rendered for tax compliance, tax advice and tax planning.

did not bill us for any other fees for the year ended December 31, 2022 and 2021.

audit committee pre-approves all auditing services, internal control-related services and permitted non-audit services (including the

fees and terms thereof) to be performed for us by our independent auditor, except for de minimis non-audit services that are approved

by the audit committee prior to the completion of the audit.

The audit committee may form and delegate authority to subcommittees consisting

of one or more members when appropriate, including the authority to grant pre-approvals of audit and permitted non-audit services, provided

that decisions of such subcommittee to grant pre-approvals is presented to the full audit committee at its next scheduled meeting.

Audit Committee pre-approved all of the fees set forth above.

information required by this Item 13 will be included in our definitive Proxy Statement for the 2024 Annual Meeting of Stockholders and

is incorporated herein by reference.

Exhibits and Financial Statement Schedules.

33 unchanged sentences

1 to Registration Statement on Form S-1 filed with the Securities and Exchange Commission on August 26, 2011)

Agreement by and between InspireMD Ltd.

and MeKo Laser Material Processing, dated as of April 15, 2010 (incorporated by reference to Exhibit 10.26 to Amendment No.

1 to Registration Statement on Form S-1 filed with the Securities and Exchange Commission on August 26, 2011)

Agreement by and between InspireMD Ltd.

and Natec Medical Ltd, dated as of September 23, 2009 (incorporated by reference to Exhibit 10.27 to Amendment No.

1 to Registration Statement on Form S-1 filed with the Securities and Exchange Commission on August 26, 2011)

InspireMD, Inc.

37 unchanged sentences

Kester, dated September 6, 2016

Form of Underwriter Warrant, dated April 2, 2018 (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on April 3, 2018)

Form of Series D Warrant (incorporated by reference to Exhibit A to Exhibit 4.3 to the Company’s Registration Statement on Form S-1, Amendment No.

2, filed with the SEC on June 26, 2018 (File No.

Form of Underwriter Warrant (incorporated by reference to Exhibit 4.5 to the Company’s Registration Statement on Form S-1, Amendment No.

2, filed with the SEC on June 26, 2018 (File No.

Fourth Amendment to the InspireMD, Inc.

44 unchanged sentences

employees under the 2021 Equity Incentive Plan (incorporated by reference to Exhibit 10.58 to the Annual Report on Form 10-K filed on March 7, 2022)

of Restricted Stock Award Agreement for U.S.

directors under the 2021 Equity Incentive Plan (incorporated by reference to Exhibit

10.59 to the Annual Report on Form 10-K filed on March 7, 2022)

of Restricted Stock Award Agreement for Israeli employees under the 2021 Equity Incentive Plan (incorporated by reference to Exhibit

10.60 to the Annual Report on Form 10-K filed on March 7, 2022)

of Restricted Stock Award Agreement for European employees under the 2021 Equity Incentive Plan (incorporated by reference to Exhibit

10.61 to the Annual Report on Form 10-K filed on March 7, 2022)

of Restricted Stock Unit Award Agreement under the 2021 Equity Incentive Plan (incorporated

by reference to Exhibit 10.62 to the Annual Report on Form 10-K filed on March 7, 2022)

Agreement by and between InspireMD, Inc.

and A.G.P./Alliance Global Partners, dated June 3, 2022 (incorporated by reference to Exhibit

1.2 of the Registration Statement on Form S-3 as filed on June 3, 2022).

Amendment to Employment Agreement, dated January 5, 2023, by and between InspireMD, Inc.

and Marvin Slosman

Amendment to Employment Agreement, dated January 18, 2023, by and between InspireMD, Inc.

Form of Restricted Stock Award Agreement for U.S.

directors under the 2021 Equity Incentive Plan (incorporated by reference to Exhibit 10.59 to the Annual Report on Form 10-K filed on March 7, 2022)

Form of Restricted Stock Award Agreement for Israeli employees under the 2021 Equity Incentive Plan (incorporated by reference to Exhibit 10.60 to the Annual Report on Form 10-K filed on March 7, 2022)

Form of Restricted Stock Award Agreement for European employees under the 2021 Equity Incentive Plan (incorporated by reference to Exhibit 10.61 to the Annual Report on Form 10-K filed on March 7, 2022)

Form of Restricted Stock Unit Award Agreement under the 2021 Equity Incentive Plan (incorporated by reference to Exhibit 10.62 to the Annual Report on Form 10-K filed on March 7, 2022)

Sales Agreement by and between InspireMD, Inc.

and A.G.P./Alliance Global Partners, dated June 3, 2022 (incorporated by reference to Exhibit 1.2 of the Registration Statement on Form S-3 as filed on June 3, 2022).

Third Amendment to Employment Agreement, dated January 5, 2023, by and between InspireMD, Inc.

and Marvin Slosman (incorporated by reference to Exhibit 10.64 to the Annual Report on Form 10-K filed on March 30, 2023)

Seventh Amendment to Employment Agreement, dated January 18, 2023, by and between InspireMD, Inc.

and Craig Shore (incorporated by reference to Exhibit 10.65 to the Annual Report on Form 10-K filed on March 30, 2023)

Employment Agreement, dated November 2, 2020, by and between the Company and Andrea Tommasoli (incorporated by reference to Exhibit 10.66 to the Annual Report on Form 10-K filed on March 30, 2023)

Form of Securities Purchase Agreement dated as of May 12, 2023 between the Company and purchaser identified therein (incorporated by reference to Exhibit 10.1 of the Current Report on Form 8-K dated May 15, 2023)

Form of Pre-Funded Warrant dated May 15, 2023 (incorporated by reference to Exhibit 10.2 of the Current Report on Form 8-K dated May 15, 2023)

Form of Series H Warrant dated May 15, 2023 (incorporated by reference to Exhibit 10.3 of the Current Report on Form 8-K dated May 15, 2023)

Form of Series I Warrant dated May 15, 2023 (incorporated by reference to Exhibit 10.4 of the Current Report on Form 8-K dated May 15, 2023)

Form of Series J Warrant dated May 15, 2023 (incorporated by reference to Exhibit 10.5 of the Current Report on Form 8-K dated May 15, 2023)

Form of Series K Warrant dated May 15, 2023 (incorporated by reference to Exhibit 10.6 of the Current Report on Form 8-K dated May 15, 2023)

Form of Registration Rights Agreement dated as of May 12, 2023 between the Company and purchaser identified therein (incorporated by reference to Exhibit 10.7 of the Current Report on Form 8-K dated May 15, 2023)

Fourth Amendment to Employment Agreement, dated August 14, 2020, by and between InspireMD, Inc.

and Craig Shore

Agreement, dated November 2, 2020, by and between the Company and Andrea Tommasoli

of Subsidiaries (incorporated by reference to Exhibit 21.1 to Current Report on Form 8-K filed with the Securities and Exchange Commission

on April 6, 2011)

of Kesselman & Kesselman, Certified Public Accountants

Certification

of Chief Executive Officer Pursuant to Section 302 of Sarbanes-Oxley Act of 2002

Certification

of Chief Financial Officer Pursuant to Section 302 of Sarbanes-Oxley Act of 2002

Certification

of Chief Executive Officer Pursuant to Section 18 U.S.C.

Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act

Certification

of Chief Financial Officer Pursuant to Section 18 U.S.C.

Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act

Inline XBRL Instance Document

(the Instance Document does not appear in the interactive data file because its XBRL tags are embedded within the Inline XBRL document)

Inline XBRL Taxonomy Extension

Schema Document

Inline XBRL Taxonomy Extension

Calculation Linkbase Document

Inline XBRL Taxonomy Extension

Definition Linkbase Document

Inline XBRL Taxonomy Extension

Labels Linkbase Document

Inline XBRL Taxonomy Extension

Presentation Linkbase Document

List of Subsidiaries (incorporated by reference to Exhibit 21.1 to Current Report on Form 8-K filed with the Securities and Exchange Commission on April 6, 2011)

Consent of Kesselman & Kesselman, Certified Public Accountants

Certification of Chief Executive Officer Pursuant to Section 302 of Sarbanes-Oxley Act of 2002

Certification of Chief Financial Officer Pursuant to Section 302 of Sarbanes-Oxley Act of 2002

Certification of Chief Executive Officer Pursuant to Section 18 U.S.C.

Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Certification of Chief Financial Officer Pursuant to Section 18 U.S.C.

Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

InspireMD, Inc.

Executive Officer Clawback Policy

XBRL Instance Document (the Instance Document does not appear in the interactive data file because its XBRL tags are embedded within

the Inline XBRL document)

XBRL Taxonomy Extension Schema Document

XBRL Taxonomy Extension Calculation Linkbase Document

XBRL Taxonomy Extension Definition Linkbase Document

XBRL Taxonomy Extension Labels Linkbase Document

XBRL Taxonomy Extension Presentation Linkbase Document

Page Interactive Data File (embedded within the Inline XBRL document)

21 unchanged sentences

OF AND FOR THE YEAR ENDED DECEMBER 31, 2023

FINANCIAL STATEMENTS

OF AND FOR THE YEAR ENDED DECEMBER 31, 2022

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM (PCAOB name:

17 unchanged sentences

in the United States of America.

Doubt About the Company’s Ability to Continue as a Going Concern

accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern.

in Note 1b to the consolidated financial statements, the Company has suffered recurring losses from operations and cash outflows from

operating activities that raise substantial doubt about its ability to continue as a going concern.

Management’s plans in regard

to these matters are also described in Note 1b.

The consolidated financial statements do not include any adjustments that might result

from the outcome of this uncertainty.

consolidated financial statements are the responsibility of the Company’s management.

32 unchanged sentences

dollars in thousands)

and cash equivalents

bank deposits

CURRENT ASSETS:

plant and equipment, net

lease right of use assets

in respect of employee rights upon retirement

Cash and cash equivalents

Short-term bank deposits

Marketable securities

Accounts receivable:

Prepaid expenses

TOTAL CURRENT ASSETS

NON-CURRENT ASSETS:

payable and accruals:

Property, plant and equipment, net

Operating lease right of use assets

Fund in respect of employee rights upon retirement

TOTAL NON-CURRENT ASSETS

LIABILITIES AND EQUITY

CURRENT LIABILITIES:

lease liabilities

for employee rights upon retirement

Accounts payable and accruals:

TOTAL CURRENT LIABILITIES

LONG-TERM LIABILITIES:

AND CONTINGENT LIABILITIES (Note 6)

stock, par value $ 0.0001 per share;

Operating lease liabilities

Liability for employee rights upon retirement

TOTAL LONG-TERM LIABILITIES

COMMITMENTS AND CONTINGENT LIABILITIES (Note 8)

TOTAL LIABILITIES

Common stock, par value $ 0.0001 per share;

150,000,000 shares authorized at December 31, 2023 and 2022;

8,330,918 and 8,296,256 shares issued

and outstanding at December 31, 2022 and 2021, respectively

C shares, par value $ 0.0001 per share;

21,841,215 and 8,330,918 shares issued and outstanding at December 31, 2023 and 2022, respectively

Preferred C shares, par value $ 0.0001 per share;

1,172,000 shares authorized at December 31, 2023 and 2022;

1,718 shares issued and outstanding

at December 31, 2022 and 2021;

paid-in capital

liabilities and equity

1,718 shares issued and outstanding at December 31, 2023 and 2022;

Additional paid-in capital

Accumulated deficit

Total liabilities and equity

* Represents an amount

2 unchanged sentences

dollars in thousands, except per share data)

Ended December 31,

and development

and marketing

and administrative

Year Ended December 31,

COST OF REVENUES

OPERATING EXPENSES:

FROM OPERATIONS

INCOME (EXPENSES), net:

BEFORE TAX EXPENSES

LOSS PER SHARE - basic and diluted

AVERAGE NUMBER OF ORDINARY SHARES USED IN COMPUTING NET LOSS PER SHARE - basic and diluted

Research and development

Selling and marketing

General and administrative

Total operating expenses

LOSS FROM OPERATIONS

FINANCIAL INCOME , net:

LOSS BEFORE TAX EXPENSES

NET LOSS PER SHARE - basic and diluted

WEIGHTED AVERAGE NUMBER OF ORDINARY SHARES USED IN COMPUTING NET LOSS PER SHARE - basic and diluted

accompanying notes are an integral part of the consolidated financial statements.

2 unchanged sentences

Preferred Stock

as of January 1, 2021

$ ( 168,176 )

of common shares, including at the market offering net of $ 2,024 issuance costs

of Warrants F

of Warrants G

of Series B Convertible Preferred Stock to common shares

of Series C Convertible Preferred Stock to common shares

compensation related to restricted stock, restricted stock units and stock options award, net of forfeitures of 20,822 shares

up of shares due to reverse stock split effectuated on April 26, 2021

as of December 31, 2021

Additional paid-in

BALANCE as of January 1, 2022

Share-based compensation related to restricted stock, restricted stock units and stock options award, net of forfeitures of 10,832 shares

BALANCE as of December 31, 2022

* Represents an amount

2 unchanged sentences

Preferred Stock

as of December 31, 2021

compensation related to restricted stock, restricted stock units and stock options award, net of forfeitures of 10,832 shares

compensation related to restricted stock, restricted stock units and stock options award, net of forfeitures of shares

as of December 31, 2022

Additional paid-in

BALANCE as of January 1, 2023

Exercise of pre-funded warrants

Issuance of common shares, pre-funded warrants and warrants, net of $ 4,635 issuance costs

Share-based compensation related to stock, restricted stock,

restricted stock units and stock options award, net of forfeitures of 29,695

Share-based compensation related to stock, restricted stock,

restricted stock units and stock options award, net of forfeitures

BALANCE as of December 31, 2023

* Represents an amount

1 unchanged sentence

dollars in thousands)

ended December 31,

FLOWS FROM OPERATING ACTIVITIES:

required to reconcile net loss to net cash used in operating activities:

and amortization

from sale of property, plant and equipment

in liability for employees rights upon retirement

financial expense

in operating right of use asset and operating leasing liability

in interest receivable on short term deposits

compensation expenses

(gain) on amounts funded in respect of employee rights upon retirement, net

in operating asset and liability items:

(Increase) in prepaid expenses

(increase) in trade receivables

in other receivables

Year ended December 31,

CASH FLOWS FROM OPERATING ACTIVITIES:

Adjustments required to reconcile net loss to net cash used in operating activities:

Depreciation and amortization

Gain from sale of property, plant and equipment

Change in fair value of markable securities, net of interest received

Change in liability for employees rights upon retirement

Other financial expense

Change in operating right of use asset and operating leasing liability

Share-based compensation expenses

Decrease (increase) in interest receivable on short term deposits

Loss (gain) on amounts funded in respect of employee rights upon retirement, net

Changes in operating asset and liability items:

Decrease in prepaid expenses

Decrease (increase) in trade receivables

Increase in other receivables

Increase in inventory

(decrease) in trade payables

(decrease) in other payables

cash used in operating activities

FLOWS FROM INVESTING ACTIVITIES:

of property, plant and equipment

in short-term bank deposits

from short-term bank deposits

funded in respect of employee rights upon retirement

cash provided by (used in) investing activities

FLOWS FROM FINANCING ACTIVITIES:

costs of At The Market offering

from issuance of shares and warrants and exercise of Pre-Funded Warrants and unit purchase option, net of $ 2,024 issuance costs

cash provided by (used in) financing activities

OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS

IN CASH AND CASH EQUIVALENTS

OF CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR

OF CASH AND CASH EQUIVALENTS AT END OF YEAR

NON-CASH INVESTING AND FINANCING ACTIVITIES:

of right-of-use assets by means of lease liabilities

Increase (decrease) in trade payables

Increase in other payables

Net cash used in operating activities

CASH FLOWS FROM INVESTING ACTIVITIES:

Purchase of property, plant and equipment

Proceeds from sale of property, plant and equipment

Investment in short-term bank deposits

Investments in marketable securities

Proceeds from matured marketable securities

Amounts funded in respect of employee rights upon retirement

Withdrawal from short-term bank deposits

Net cash provided by (used in) investing activities

CASH FLOWS FROM FINANCING ACTIVITIES:

Issuance costs of At The Market offering

Proceeds from issuance of shares and warrants net of $ 4,635 issuance costs,

Net cash provided by (used in) financing activities

EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS

BALANCE OF CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR

BALANCE OF CASH AND CASH EQUIVALENTS AT END OF YEAR

SUPPLEMENTAL NON-CASH INVESTING AND FINANCING ACTIVITIES:

Acquisition of right-of-use assets by means of lease liabilities

Non-cash lease incentive

Decrease in right-of-use assets and lease liabilities due to shortening lease term

accompanying notes are an integral part of the consolidated financial statements.

7 unchanged sentences

carotid artery disease.

Company’s MGuard™ Prime™ embolic protection system (“MGuard Prime EPS”) was marketed for use in patients

with acute coronary syndromes, notably acute myocardial infarction (heart attack) and saphenous vein graft coronary interventions,

or bypass surgery.

MGuard Prime EPS combines MicroNet with a bare-metal cobalt-chromium based stent.

MGuard Prime EPS received CE

mark approval in the European Union in October 2010 for improving luminal diameter and providing embolic protection.

Over the past

years, there has been a shift in industry preferences away from bare-metal stents, such as MGuard Prime EPS in ST-Elevation Myocardial

Infarction (“STEMI”) patients.

As a result of declining sales of the MGuard Prime EPS, which the Company believes is

largely driven by the predominant industry preferences favoring drug-eluting, or drug-coated, stents, during the second quarter of

2022, the Company ceased sales of the Company’s MGuard Prime EPS following a phase out period.

Company markets its products through distributors in international markets, mainly in Europe.

Company has an accumulated deficit as of December 31, 2022, as well as a history of net losses and negative operating cash flows

in recent years.

The Company expects to continue incurring losses and negative cash flows from operations until its product, CGuard™

EPS, reaches commercial profitability.

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

Company’s current cash position, the Company has sufficient resources to fund operations until the end of September 2023.

there is substantial doubt about the Company’s ability to continue as a going concern.

These financial statements have been

prepared assuming that the Company will continue as a going concern and do not include any adjustments that might result from the

outcome of this uncertainty.

plans include the continued commercialization of the Company’s product and raising capital through the sale of additional equity

securities, debt or capital inflows from strategic partnerships.

There are no assurances however, that the Company will be successful

in obtaining the level of financing needed for its operations.

If the Company is unsuccessful in commercializing its products and

raising capital, it may need to reduce activities, curtail or cease operations.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

DESCRIPTION OF BUSINESS (continued):

to satisfy regulatory requirements of the new European Medical Device Regulation could prevent

the Company from marketing CGuard EPS in countries requiring the CE Mark.

the European Union nations, medical devices must obtain a CE mark before they may be placed on the market.

In order to obtain and

maintain the CE mark, the Company must comply with EU law on medical devices, which, until May 26, 2021 was governed by the Medical

Device Directive 93/42/EEC (“MDD”), by presenting comprehensive technical files for its products demonstrating safety

and efficacy of the product to be placed on the market and passing initial and annual quality management system audit as per ISO

13485 standard by a European Notified Body.

The Company has obtained ISO 13485 quality system certification and CGuard

EPS that the Company currently distributes into the European Union, displays the required CE mark.

In order to maintain certification,

the Company is required to pass an annual surveillance audit conducted by Notified Body auditors.

European Union replaced the MDD with the new European Medical Device Regulation, or MDR (MDR 2017/745).

The MDR entered into force after

a transitional period of three years and a one year extension of that transition period due to the COVID-19 pandemic on May 26, 2021

and which changes several aspects of the regulatory framework in the European Union.

Company ceased sales of the Company’s MGuard Prime EPS in the beginning of 2022.

Company market its products through distributors in international markets, mainly in Europe.

of the date of issuance of these consolidated financial statements, the Company has the ability to fund its planned operations for at

least the next 12 months.

However, the Company expects to continue incurring losses and negative cash flows from operations until its

product, CGuard™ EPS, reaches commercial profitability.

Therefore, in order to fund the Company’s operations until such time

that the Company can generate substantial revenues, the Company may need to raise additional funds.

of European Medical Device Regulation for marketing CGuard EPS in countries requiring the

the European Union (“EU”) nations, medical devices must obtain a CE mark before they may be placed on the market.

order to obtain and maintain the CE mark, the Company must comply with EU law on medical devices, which, until May 26, 2021 was governed

by the Medical Device Directive 93/42/EEC (“MDD”), by presenting comprehensive technical files for the Company’s

products demonstrating safety and efficacy of the product to be placed on the market and passing initial and annual quality management

system audit as per ISO 13485 standard by a European Notified Body.

The Company has obtained ISO 13485 quality system certification

and CGuard EPS that the Company currently distribute into the European Union, displays the required CE mark.

In order to maintain

certification, the Company is required to pass an annual surveillance audit conducted by Notified Body auditors.

The European Union

replaced the MDD with the new European Medical Device Regulation (MDR 2017/745) (“MDR”) regulations.

The MDR entered

into force after a transitional period of three years and a one year extension of that transition period due to the COVID-19 pandemic

on May 26, 2021 and which changes several aspects of the regulatory framework in the EU.

Manufacturers had the duration of the transition

period to update their technical documentation and processes to meet the new requirements in order to obtain a CE Mark.

In the Company’s specific case, the

Company’s’ CE mark for CGuard EPS under the MDD expired on November 12, 2022 and it is in the final stages of technical

documentation review by the Notified Body auditor to meet the Medical Device Regulation (“MDR”) (MDR 2017/745)

requirements (which replaced the MDD) for recertification.

In the meantime, on February 14, 2023, the Company received a derogation

per Article 97 paragraph 1 of Regulation 2017/745 from the Agency for Medicines and Health Products (FAMHP) allowing it to continue

marketing CGuard EPS in the European Union until August 15, 2023 subject to certain procedural requirements.

the Company’s specific case, the Company’s CE mark for CGuard EPS under the MDD expired on November 12, 2022.

14, 2023, the Company received a derogation per Article 97 paragraph 1 of Regulation 2017/745 from the Agency for Medicines and Health

Products (FAMHP) allowing the Company to continue marketing CGuard EPS in the EU until August 15, 2023.

Subsequently, on March 20,

20, 2023, Regulation (EU) 2023/607 was published allowing us to continue marketing CGuard EPS in EU countries under the MDD

directive until December 31, 2027.

This allows the Company to market and sell CGuard EPS in the EU and certain other jurisdictions

subject to certain procedural requirements while the Company’s MDR CE recertification is pending.

TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

1 - DESCRIPTION OF BUSINESS (continued):

2023 Regulation (EU) 2023/607 was published allowing the Company to continue marketing CGuard EPS in EU countries under the MDD directive

until December 31, 2027.

January 2024, the Company received CE mark recertification for the CGuard™ EPS under the EU’s Medical Device Regulation

regulatory framework and can market Cguard permanently in EU countries as long as the Company is able to maintain its regulatory

Related to Our Operations in Israel including the recent attack by Hamas and other terrorist

organizations from the Gaza Strip and Israel’s war against them.

October 2023, Israel was attacked by a terrorist organization and entered a state of war.

As of the date of these consolidated financial

statements, the war in Israel is ongoing and continues to evolve.

The Company operations including the production facility are located

Currently, such activities in Israel remain largely unaffected.

During the year ended December 31, 2023, the impact of this

war on the Company’s results of operations and financial condition was immaterial, but such impact may increase, which could be

material, as a result of the continuation, escalation or expansion of such war.

Related to the Geopolitical and Military Tensions Between Russia and Ukraine in Europe

February 2022, Russia launched a military invasion into Ukraine.

The Company derived approximately 9.9% of total sales in Russia

and Belarus in 2021 while during 2022 the Company’s sales to Russia and Belarus were 12.1%.

The escalation of geopolitical

instability in Russia and Ukraine as well as currency fluctuations in the Russian Ruble could negatively impact the Company’s

operations, sales, and future growth prospects in that region.

Company derived approximately 13.5 % and 12.1 % in the years ended December 31, 2023 and 2022,

respectively, of total sales in Russia and Belarus.

The escalation of geopolitical instability

in Russia and Ukraine as well as currency fluctuations in the Russian Ruble could negatively

impact the Company’s operations, sales, and future growth prospects in that region.

a result of the crisis in Ukraine, the United States and the EU have implemented sanctions against certain Russian individuals and

entities and have made it more difficult for us to collect on outstanding accounts receivable from customers in this region.

Company’s global operations expose the Company to risks that could adversely affect the Company’s business, financial condition,

results of operations, cash flows or the market price of the Company’s securities, including the potential for increased tensions

between the United States and Russia resulting from the current situation involving Russia and Ukraine, tariffs, economic sanctions

and import-export restrictions imposed by either nation, and retaliatory actions by the other nation, as well as the potential negative

impact on the Company’s business and sales in Russia, and Belarus.

Current geopolitical instability in Russia and Ukraine and

related sanctions by the U.S.

government against certain companies and individuals may hinder the Company’s ability to conduct

business with potential or existing customers and vendors in these countries.

government has imposed sanctions through several executive orders restricting U.S.

companies from conducting business with specified

Russian individuals and companies.

While the Company believes that the executive orders currently do not preclude the Company from

conducting business with the Company’s current customers or vendors in Russia, and Belarus, the sanctions imposed by the U.S.

government may be expanded in the future to restrict the Company from engaging with them.

If the Company is unable to conduct business

with new or existing customers or vendors or pursue business opportunities in Russia, or Belarus, the Company’s business, including

revenue, profitability and cash flows, and operations could be adversely affected.

The Company cannot provide assurance that current

sanctions or potential future changes in sanctions will not have a material impact on the Company’s operations in Russia, and

Belarus or on the Company’s financial results.

entities and have made it more difficult for the Company to collect on outstanding accounts receivable from customers in this region.

The Company cannot provide assurance that potential future changes in sanctions will not have a material impact on the Company’s

operations in Russia and Belarus or on the Company’s financial results.

TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

9 unchanged sentences

Functional currency

currency of the primary economic environment in which the operations of the Company and its subsidiaries are conducted is the U.S.

(“$” or “dollar”).

Accordingly, the functional currency of the Company and its subsidiaries is the U.S.

dollar figures are determined as follows:

The currency of the primary economic environment in which the operations of the Company and its subsidiaries are conducted is the

dollar (“$” or “dollar”).

Accordingly, the functional currency of the Company and its subsidiaries is the

The dollar figures are determined as follows:

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

5 unchanged sentences

Principles of consolidation

consolidated financial statements include the accounts of the Company and of its subsidiaries.

Intercompany transactions and balances

have been eliminated upon consolidation.

The consolidated financial statements include the accounts of the Company and of its subsidiaries.

Intercompany transactions and

balances have been eliminated upon consolidation.

Cash and cash equivalents

Company considers all highly liquid investments, which include short-term bank deposits (up to three months from date of deposit), that

are not restricted as to withdrawal or use, to be cash equivalents.

The Company considers all highly liquid investments purchased with original maturities of three months or less from the purchase

date to be cash equivalents.

As of December 31, 2023, cash and cash equivalents consisted of cash, short-term deposits (up to three months

from the date of deposit) and money market funds.

As of December 31, 2022, this balance consisted solely of cash.

Marketable securities

Marketable securities consist of debt securities.

The Company elected the fair value option to measure and recognize its investments

in debt securities in accordance with ASC 825, Financial Instruments as the Company manages its portfolio and evaluates the performance

on a fair value basis.

Changes in fair value, realized gains and losses on sales of marketable securities, are reflected in the statements

of operation as finance expense (income), net.

securities are classified under current assets in the consolidated balance sheet as they represent the investment of funds available

for the Company’s current operations.

TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

6 unchanged sentences

Concentration of credit risk and allowance for doubtful accounts

instruments that may potentially subject the Company to a concentration of credit risk consist of cash and cash equivalents and short-term

bank deposits, which are deposited in major financially sound institutions in the U.S, Israel and Germany, and trade accounts receivable.

The Company’s trade accounts receivable is derived from revenues earned from customers from various countries.

The Company performs

ongoing credit evaluations of its customers’ financial condition and, requires no collateral from its customers.

The Company also

has a credit insurance policy for some of its customers.

The Company maintains an allowance for doubtful accounts receivable based upon

the expected ability to collect the accounts receivable.

The Company reviews its allowance for doubtful accounts quarterly by assessing

individual accounts receivable and all other balances based on historical collection experience and an economic risk assessment.

Company determines that a specific customer is unable to meet its financial obligations to the Company, the Company provides an allowance

for credit losses to reduce the receivable to the amount management reasonably believes will be collected, which is netted against “Accounts

receivable - Trade”.

are stated at the lower of cost (cost is determined on a “first-in, first-out” basis) or net realizable value.

The Company’s

inventories generally have a limited shelf life and are subject to impairment as they approach their expiration dates.

The Company regularly

evaluates the carrying value of its inventory and when, based on such evaluation, factors indicate that impairment has occurred, the

Company impairs the inventories’ carrying value.

Financial instruments that may potentially subject the Company to a concentration of credit risk consist of cash and cash equivalents

and short-term bank deposits, which are deposited in major financially sound institutions in the U.S, Israel and Germany, and trade accounts

receivable and other receivables.

The Company’s trade accounts receivable is derived from revenues earned from customers from various

The Company performs ongoing credit evaluations of its customers’ financial condition and, requires no collateral from

its customers.

The Company also has a credit insurance policy for some of its customers.

The Company maintains the allowance for estimated

losses resulting from the inability of the Company’s customers to make required payments.

The allowance represents the current

estimate of lifetime expected credit losses over the remaining duration of existing accounts receivable considering current market conditions

and supportable forecasts when appropriate.

The estimate is a result of the Company’s ongoing evaluation of collectability, customer

creditworthiness, historical levels of credit losses, and future expectations.

The allowance for expected credit losses was immaterial

during the periods presented.

Inventories are stated at the lower of cost (cost is determined on a “first-in, first-out” basis) or net realizable

The Company’s inventories generally have a limited shelf life and are subject to impairment as they approach their expiration

The Company regularly evaluates the carrying value of its inventory and when, based on such evaluation, factors indicate that

impairment has occurred, the Company impairs the inventories’ carrying value.

Operating leases are included in operating lease right-of-use (“ROU”) assets.

9 unchanged sentences

Property, plant and equipment

plant and equipment are stated at cost, net of accumulated depreciation and amortization.

Depreciation is calculated using the straight-line

method over the estimated useful lives of the

related assets:

years for computers and other electronic equipment,

years for office furniture and equipment and machinery

and equipment (mainly seven

Leasehold improvements are amortized

on a straight-line basis over the term of the lease, which is shorter than the estimated life of the improvements.

Impairment in

value of long-lived assets

Company tests long-lived tangible assets for impairment whenever events or circumstances present an indication of impairment.

sum of expected future cash flows (undiscounted and without interest charges) of the long-lived assets is less than the carrying amount

of such assets, an impairment would be recognized, and the assets would be written down to their estimated fair values, based on expected

future discounted cash flows.

Property, plant and equipment are stated at cost, net of accumulated depreciation and amortization.

Depreciation is calculated

using the straight-line method over the estimated useful lives of the related assets:

over three years for computers and other electronic

equipment, and seven to fifteen years for office furniture and equipment and machinery and equipment (mainly seven years).

improvements are amortized on a straight-line basis over the term of the lease, which is shorter than the estimated life of the improvements.

Impairment in value of long-lived assets

The Company tests long-lived tangible assets for impairment whenever events or circumstances present an indication of impairment.

If the sum of expected future cash flows (undiscounted and without interest charges) of the long-lived assets is less than the carrying

amount of such assets, an impairment would be recognized, and the assets would be written down to their estimated fair values, based

on expected future discounted cash flows.

TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

1 unchanged sentence

Revenue recognition

contract with a customer exists only when:

1) the parties to the contract have approved it and are committed to perform their respective

obligations, 2) the Company can identify each party’s rights regarding the distinct goods or services to be transferred (“Performance

Obligations”), 3) the Company can determine the transaction price for the goods or services to be transferred, 4) the contract

has commercial substance and 5) it is probable that the Company will collect the consideration to which it will be entitled in exchange

for the goods or services that will be transferred to the customer.

Revenues are recorded in the amount of consideration to which the

Company expects to be entitled in exchange for Performance Obligations upon transfer of control to the customer, excluding sales taxes.

from sales of goods, including sales to distributors, is recognized when the customer obtains control of the product, once the Company

has a present right to payment and the customer has legal title, and risk and rewards of ownership are obtained by the customer.

this occurs when products are shipped.

In few cases when products are directly sold to medical centers on consignment basis, revenue

is recognized when the product is consumed.

Company recognizes the incremental costs of obtaining contracts as an expense since the amortization period of the assets that the Company

otherwise would have recognized is one year or less.

A contract with a customer exists only when:

1) the parties to the contract have approved it and are committed to perform their

respective obligations, 2) the Company can identify each party’s rights regarding the distinct goods or services to be transferred

(“Performance Obligations”), 3) the Company can determine the transaction price for the goods or services to be transferred,

4) the contract has commercial substance and 5) it is probable that the Company will collect the consideration to which it will be entitled

in exchange for the goods or services that will be transferred to the customer.

Revenues are recorded in the amount of consideration

to which the Company expects to be entitled in exchange for Performance Obligations upon transfer of control to the customer, excluding

Revenue from sales of goods, including sales to distributors, is recognized when the customer obtains control of the product, once

the Company has a present right to payment and the customer has legal title, and risk and rewards of ownership are obtained by the customer.

Generally, this occurs when products are shipped.

In few cases when products are directly sold to medical centers on consignment basis,

revenue is recognized when the product is consumed.

The Company recognizes the incremental costs of obtaining contracts as an expense since the amortization period of the assets that

the Company otherwise would have recognized is one year or less.

The costs are recorded under selling and marketing expenses.

Disaggregated revenue

is disclosed in Note 11.

Company recognizes revenue net of value added tax (VAT).

Disaggregated

revenue is disclosed in Note 13.

The Company recognizes revenue net of value added tax (VAT).

Research and development costs

and development costs, including the costs of the Company’s US based clinical trial costs of approximately $ 4,468,000 and $ 2,037,000 for the years

ended December 31, 2022 and 2021, respectively, and are charged to the statement of operations as incurred.

Research and development costs, including the costs of the Company’s US based clinical trial costs were approximately $ 3,300,000

and $ 4,468,000

for the years ended December 31, 2023 and 2022,

respectively, and charged to the statement of operations as incurred.

Share-based compensation

Company has equity incentive plans under which the Company grants equity awards, including stock options, restricted stock and restricted

stock units (“RSUs”) to employees and service providers.

Employee equity awards are classified as equity awards

and accounted for using the grant-date fair value method.

The Company determines compensation expense associated with restricted stock

and RSUs based on the fair value of our common stock on the date of grant.

The fair value of option awards is estimated using the Black-Scholes

valuation model and expensed over the requisite service period.

The Company elected to account for forfeitures as they occur.

The Company elected to recognize compensation expenses for awards to employees with only service conditions that have graded vesting schedules using the accelerated multiple option approach.

The Company has equity incentive plans under which the Company grants equity awards, including stock options, restricted stock

and restricted stock units (“RSUs”) to employees, directors and service providers.

Employee and service providers equity

awards are accounted for using the grant-date fair value method.

The Company determines compensation expense associated with restricted

stock and RSUs based on the fair value of our common stock on the date of grant.

The fair value of option awards is estimated using the

Black-Scholes valuation model and expensed over the requisite service period.

The Company elected to account for forfeitures as they

Company elected to recognize compensation expenses for awards to employees with only service conditions that have graded vesting schedules

using the accelerated multiple option approach.

The attribution for nonemployee awards is in the same manner as if the Company

had paid cash for the goods or services.

In addition, certain of our share-based awards to service providers are performance based, i.e.,

the vesting of these awards depends upon achieving certain goals.

The company recognizes compensation expenses for awards with performance

conditions when the company concludes that it is probable that the performance condition will be achieved.

Uncertain tax positions

Company follows a two-step approach to recognizing and measuring uncertain tax positions.

The first step is to evaluate the tax position

for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be

sustained on audit.

If under the first step a tax position is assessed to be more likely than not of being sustained on audit, the second

step is performed, under which the tax benefit is measured as the largest amount that is more than 50% likely to be realized upon ultimate

Such liabilities are classified as long-term, unless the liability is expected to be resolved within twelve months from the

balance sheet date.

The Company’s policy is to include interest related to unrecognized tax benefits within “Financial expenses

Deferred income taxes

Deferred taxes are determined utilizing the “asset and liability” method based on the estimated future tax effects of differences between the financial accounting and tax bases of assets and liabilities under the applicable tax laws, and on tax rates anticipated to be in effect when the deferred taxes are expected to be paid or realized.

The Company assesses realization of deferred income tax assets and, based on all available evidence, concludes whether it is more likely than not that the net deferred income tax assets will be realized.

A valuation allowance is provided for the amount of deferred income tax assets not considered to be realizable.

Company may incur an additional tax liability in the event of intercompany dividend distributions by its subsidiaries.

Such additional

tax liability in respect of these foreign subsidiaries has not been provided for in these financial statements as it is the Company’s

policy to permanently reinvest the subsidiaries’ earnings and to consider distributing dividends only in connection with a specific

tax opportunity that may arise.

that would apply in the event of disposal of investments in a foreign subsidiary have not been taken into account in computing the deferred

taxes, as it is the Company’s intention to hold, and not to realize, these investments.

The Company follows a two-step approach to recognizing and measuring uncertain tax positions.

The first step is to evaluate the

tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position

will be sustained on audit.

If under the first step a tax position is assessed to be more likely than not of being sustained on audit,

the second step is performed, under which the

tax benefit is measured as the largest amount that is more than 50% likely to be realized upon ultimate settlement.

liabilities are classified as long-term, unless the liability is expected to be resolved within twelve months from the balance sheet

The Company’s policy is to include interest related to unrecognized tax benefits within “Financial expenses - net”.

TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

2 - SIGNIFICANT ACCOUNTING POLICIES (continued):

related to advertising and promotion of products are charged to sales and marketing expense as incurred.

Advertising expenses were approximately

$ 359,000 and $ 290,000 for the years ended December 31, 2022 and 2021, respectively.

Deferred taxes are determined utilizing the “asset and liability” method based on the estimated future tax effects

of differences between the financial accounting and tax bases of assets and liabilities under the applicable tax laws, and on tax rates

anticipated to be in effect when the deferred taxes are expected to be paid or realized.

The Company assesses realization of deferred

income tax assets and, based on all available evidence, concludes whether it is more likely than not that the net deferred income tax

assets will be realized.

A valuation allowance is provided for the amount of deferred income tax assets not considered to be realizable.

The Company may incur an additional tax liability in the event of intercompany dividend distributions by its subsidiaries.

additional tax liability in respect of these foreign subsidiaries has not been provided for in these financial statements as it is the

Company’s policy to permanently reinvest the subsidiaries’ earnings and to consider distributing dividends only in connection

with a specific tax opportunity that may arise.

Taxes that would apply in the event of disposal of investments in a foreign subsidiary have not been taken into account in computing

the deferred taxes, as it is the Company’s intention to hold, and not to realize, these investments.

Costs related to advertising and promotion of products are charged to sales and marketing expense as incurred.

Advertising expenses

were approximately $ 426,000 and

$ 359,000 for

the years ended December 31, 2023 and 2022, respectively.

Net loss per share

and diluted net loss per share is computed by dividing the net loss for the period attributable to common stock by the weighted average

number of shares of common stock outstanding during the period, including 0 and 11,696 weighted average shares of common stock issuable

to holders of Series B Convertible Preferred Stock for the years ended December 31, 2022 and 2021, respectively.

The total number

of shares of common stock related to outstanding options, warrants, restricted stock, RSUs and Series C Convertible

Preferred Stock excluded from the calculations of diluted loss per share were 2,741,355 and 2,840,179 for the years ended December 31,

2022 and 2021, respectively.

and diluted net loss per share is computed by dividing the net loss for the period by the weighted average number of shares of common

stock, pre-funded warrants and fully vested restricted stock units outstanding during the period.

The calculation of diluted net loss

per share excludes the effect of potential dilution of share options, warrants, and unvested restricted stocks, unvested restricted stock

units and Series C preferred stock as the effect is anti-dilutive.

For the purpose of calculating basic net loss per share, the

additional shares of common stock that are issuable upon exercise of the Pre-funded Warrants have been included since the shares are

issuable for a negligible consideration, as determined by the Company according to ASC 260-10-45-13, and have no vesting or other contingencies

associated with them.

For the year ended December 31, 2023, we had weighted average Pre-funded Warrants to purchase 9,612,502

share of common stock, which was used in the

computation of net loss per share for the year.

The total number of shares of common stock related to outstanding options, warrants,

unvested restricted stock, unvested restricted stock units and Series C Preferred Stock, which were excluded from the calculations of

diluted loss per share were 74,978,006

and 2,741,355

for the years ended December 31, 2023 and 2022,

respectively.

This amount includes 3,054,086

of unvested restricted stock included in the

number of issued and outstanding shares as of December 31, 2023 and 2022, respectively.

Segment reporting

Company has one operating and reportable segment.

The Company has one

operating and reportable segment.

Fair value measurement

Company measures fair value and discloses fair value measurements for financial assets and liabilities.

Fair value is based on the price

that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the

measurement date.

accounting standard establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value

into three broad levels, which are described below:

The Company measures fair value and discloses fair value measurements for financial assets and liabilities.

Fair value is based

on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants

at the measurement date.

The accounting standard establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure

fair value into three broad levels, which are described below:

Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities.

The fair value

hierarchy gives the highest priority to Level 1 inputs.

fair value hierarchy gives the highest priority to Level 1 inputs.

Observable prices that are based on inputs not quoted on active markets but corroborated by market data.

Unobservable inputs are used when little or no market data is available.

The fair value hierarchy gives the lowest priority to Level

The fair value hierarchy gives the lowest priority

to Level 3 inputs.

determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of

unobservable inputs to the extent possible and considers counterparty credit risk in its assessment of fair value.

has no financial instruments measured carried at fair value in each reporting period.

The fair value of the Company’s financial

instruments approximates their carrying values.

TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

2 - SIGNIFICANT ACCOUNTING POLICIES (continued):

Issued accounting pronouncements effective in future periods

Instruments - Credit Losses

Recently adopted accounting pronouncement

In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326)-Measurement of Credit Losses on Financial Instruments.

This guidance replaces the current incurred loss impairment methodology.

This guidance replaces the incurred loss impairment methodology.

Under the new guidance, on initial recognition and at each reporting period, an entity is required to recognize an allowance that reflects its current estimate of credit losses expected to be incurred over the life of the financial instrument based on historical experience, current conditions and reasonable and supportable forecasts.

6 unchanged sentences

All other entities are permitted to defer adoption of ASU 2016-13, and its related amendments, until the earlier of fiscal periods beginning after December 15, 2022.

Under the current SEC definitions, the Company meets the definition of an SRC and is adopting the deferral period for ASU 2016-13.

Under the current SEC definitions, the Company met the definition of an SRC and adopted the deferral period for ASU 2016-13.

The guidance requires a modified retrospective transition approach through a cumulative-effect adjustment to retained earnings as of the beginning of the period of adoption.

The Company does not believe the adoption of this standard will have a material impact on its consolidated financial statements.

The Company adopted the provisions of this update as of January 1, 2023 with no material impact on its consolidated financial statements.

Recently issued accounting pronouncement, not yet adopted

November 2023, the FASB issued ASU 2023-07 “Segment Reporting:

Improvements to Reportable Segment Disclosures”.

This guidance

expands public entities segment disclosures primarily by requiring disclosure of significant segment expenses that are regularly

provided to the chief operating decision maker and included within each reported measure of segment profit or loss, an amount and description

of its composition for other segment items, and interim disclosures of a reportable segment’s profit or loss and assets.

entities with a single reportable segment are required to provide the new disclosures and all the disclosures required under ASC 280.

The guidance is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after

December 15, 2024, with early adoption permitted.

The amendments are required to be applied retrospectively to all prior periods presented

in an entity’s financial statements.

The Company is currently evaluating this guidance to determine the impact it may have on its

consolidated financial statements related disclosures.

In December 2023, the FASB issued ASU 2023-09 “Income Taxes (Topic 740):

Improvements to Income Tax Disclosures”.

guidance is intended to enhance the transparency and decision-usefulness of income tax disclosures.

The amendments in ASU 2023-09

address investor requests for enhanced income tax information primarily through changes to disclosure regarding rate reconciliation

and income taxes paid both in the U.S.

and in foreign jurisdictions.

ASU 2023-09 is effective for fiscal years beginning after

December 15, 2024 on a prospective basis, with the option to apply the standard retrospectively.

Early adoption is permitted.

Company is currently evaluating this guidance to determine the impact it may have on its consolidated financial statements

August 2020, the FASB issued ASU 2020-06 “Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives

and Hedging – Contracts in Entity’s Own Equity (Subtopic 815 – 40).” This guidance simplifies the accounting

for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts on

an entity’s own equity.

This ASU is effective for the Company for fiscal years beginning after December 15, 2023, and interim periods

within those fiscal years.

The initial adoption of ASU 2020-06 is not expected to have a material impact on the Company’s consolidated

financial statements.

TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

3 – FAIR VALUE MEASUREMENTS

of December 31, 2023, the carrying amounts of accounts payable, accounts receivable and other receivable approximate their fair values

due to the short-term maturities of these instruments.

Company’s financial assets subject to fair value measurements on a recurring basis and the level of inputs used in such measurements

were as follows:

OF FINANCIAL ASSETS SUBJECT TO FAIR VALUE MEASUREMENTS

As of December 31, 2023

($ in thousands)

Cash equivalents-

Money market funds

Marketable securities-

U.S government bonds

Company’s debt securities are classified within Level 2 because it uses quoted market prices or alternative pricing sources and

models utilizing market observable inputs to determine their fair value.

cost of Marketable securities as of December 31, 2023 is $ 28,727,000 .

4 - MARKETABLE SECURITIES

following table sets forth the Company’s marketable securities for the indicated period:

OF MARKETABLE SECURITIES

December 31, 2023

($ in thousands)

U.S government bonds

Marketable securities

following table summarizes the fair value of the Company’s marketable securities classified by maturity as of December 31, 2023:

OF FAIR VALUE OF MARKETABLE SECURITIES CLASSIFIED BY MATURITY

December 31, 2023

($ in thousands)

Amounts maturing within one year

Amounts maturing after one year through two years

table below sets forth a summary of the changes in the fair value of the Company’s marketable securities for the year ended December

OF CHANGES IN FAIR VALUE OF MARKETABLE SECURITIES

($ in thousands)

Balance at beginning of the period

Sale or maturity

Interest Received

Changes in fair value

Balance at end of the period

TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

5 - PROPERTY, PLANT AND EQUIPMENT

of assets, grouped by major classifications, is as follows:

Composition of

assets, grouped by major classifications, is as follows:

OF PROPERTY PLANT AND EQUIPMENT

($ in thousands)

furniture and equipment

and equipment

Computer equipment

Office furniture and equipment

Machinery and equipment

Leasehold improvements

plant and equipment, gross

- accumulated depreciation and amortization

carrying amount

Less - accumulated depreciation and amortization

Net carrying amount

and amortization expenses totaled approximately $ 232,000 and $ 188,000 for the years ended December 31, 2023 and 2022, respectively.

21 unchanged sentences

On May 25, 2022 the Company amended the agreement mentioned

above and extended it until December 31, 2026 as well as leasing of additional space in the facility, the additional space amendment

was taken in consideration when calculating the operating lease right of use assets and liabilities.

lease cost for the years ended December 31, 2022 and 2021 was $ 442,000 and $ 476,000 respectively.

above and extended it until December 31, 2026 as well as leasing of additional space in the facility.

On August 24, 2023, the Company amended the lease agreement mentioned above, leasing additional space in the facility and shortened the lease term of another space in the building.

The balances of right of use assets and lease liabilities increased due to the newly leased space and decreased due to the lease that was shortened.

lease cost for the years ended December 31, 2023 and 2022 was $ 433,000

and $ 442,000 respectively.

information related to leases are as follows:

SCHEDULE OF SUPPLEMENTAL INFORMATION RELATED TO LEASES

lease right-of-use assets

Operating lease liabilities

operating lease liabilities

cash flows from operating leases (cash paid in thousands)

Average Remaining Lease Term

Average Discount Rate

in thousands)

Operating lease right-of-use assets

Current Operating lease liabilities

Non-current operating lease liabilities

Operating cash flows from operating leases (cash paid in thousands)

Weighted Average Remaining Lease Term

Weighted Average Discount Rate

of lease liabilities are as follows:

1 unchanged sentence

($ in thousands)

lease payments

imputed interest

Total lease payments

Less imputed interest

TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

14 unchanged sentences

The financial statements include a liability, based

on 50 % of the Distributor costs incurred up to December 31, 2022.

The liability at December 31, 2022.

is immaterial.

Note 7 for details regarding an investment transaction with one of the Chinese parties to the Distribution Agreement.

Company’s shares that previously traded on the NYSE American were approved for listing on the Nasdaq Capital Market (“Nasdaq”)

and such shares began trading on Nasdaq on May 21, 2021 under the symbol, “NSPR.”

April 19, 2021, the Company filed with the Secretary of State of Delaware a Certificate of Amendment to the Company’s Amended and

Restated Certificate of Incorporation to effect a one-for-fifteen reverse stock split of its common stock , par value $ 0.0001 per share,

effective as of April 26, 2021.

TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

7 – EQUITY (continued):

February 8, 2021, the Company closed an underwritten public offering (the “Offering”) of 1,935,484

units (“Units”), with each Unit being

comprised of one share of the Company’s common stock, par value $ 0.0001

per share, and one Series G warrant (the “Series

G Warrants”) to purchase one-half of one share of common stock.

In connection with this public offering, the underwriter exercised

its over-allotment option in full and purchased an additional 290,322

shares of common stock and 145,161

Series G Warrants.

The offering price to the

public was $ 9.30

The Series G Warrants are immediately

exercisable at a price of $ 10.23

per and expire five

years from the date of issuance.

Company granted the underwriter compensation warrants to purchase up to 111,290 shares of common stock.

The underwriter warrants

have an exercise price of $ 10.23 per share and are exercisable immediately and for five years from the date of effectiveness of the

registration statement in connection with the Offering.

net proceeds to the Company 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 expenses associated

with the Offering, but excluding the proceeds, if any, from the exercise of Series G Warrants sold in the Offering.

February 3, 2021, the Company entered into a Distribution Agreement with three China-based partners, See Note 6b.

for details about

the Distribution Agreement.

addition, and on the same day, the Company entered into an investment transaction with one of the Chinese parties to the Distribution

Agreement, which included a securities purchase agreement pursuant to which investor agreed to invest

$ 900,000 in exchange for 89,445 shares of the Company’s common stock at a purchase price of $ 10.062 per share.

the year ended December 31, 2021, Series F and Series G warrants to purchase shares of common stock were exercised by investors at

an exercise price of $ 7.425 and $ 10.23 per share, resulting in the issuance of 1,225,412 shares of common stock for proceeds of approximately

$ 9,469,000 .

the year ended December 31, 2021, the Company sold 818,523 shares of its common stock pursuant to its at-the-market (ATM) issuance sales

agreement with a sales agent.

These sales resulted aggregate net proceeds to the Company of approximately $ 5,453,000 .

July 7, 2016, the Company issued 442,424 shares of Series B Preferred Stock in a public offering.

During the year ended December 31,

2021, all the remaining 17,303 shares of Series B Convertible Preferred Stock were converted into 207,528 shares of common stock.

on 50 % of the Distributor costs incurred until December 31, 2023.

The liability at December 31, 2023 is immaterial.

Company’s common stock are listed on the Nasdaq Capital Market.

May 12, 2023, the Company entered into a securities purchase agreement (the “Purchase Agreement”) pursuant to which the

Company agreed to sell and issue in a private placement (the “Private Placement Offering) an aggregate of 10,266,270 shares

(the “Private Placement Shares”) of the Company’s common stock, pre-funded warrants (the “Pre-Funded Warrants”)

to purchase up to 15,561,894 shares of common stock and warrants to purchase up to an aggregate of 51,656,328 shares of common stock,

consisting of Series H warrants to purchase up to 12,914,086 shares of common stock (the “Series H Warrants”), Series

I warrants to purchase up to 12,914,078 shares of common stock (the “Series I Warrants”), Series J warrants to purchase

up to 12,914,086 shares of Common Stock (the “Series J Warrants”) and Series K warrants to purchase up to 12,914,078

shares of common stock (the “Series K Warrants” and together with the Series H Warrants, Series I Warrants and Series

J Warrants, the “Warrants”), at an offering price of $ 1.6327 per Private Placement Share and associated Warrants and

an offering price of $ 1.6326 per Pre-Funded Warrant and associated Warrants.

The Private Placement Offering closed on May 16, 2023.

gross proceeds to the Company in respect of the Private Placement Offering were $ 42.2 million, before deducting fees payable to the

placement agent and other offering expenses payable by the Company which amounted to approximately $ 4.6 million.

If the Warrants

are exercised in cash in full this would result in an additional $ 71.4 million of gross proceeds.

TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

7 – EQUITY (continued):

March 14, 2017, the Company issued 1,069,822

shares of Series C Preferred Stock in a public

the year ended December 31, 2021, an amount of 625

shares of Series C Convertible Preferred Stock were converted into 831

shares of common stock.

As of December 31, 2021 and 2022, there were 1,718

shares of Series C Preferred Stock outstanding with a total stated value of $10,997 which convertible into an aggregate of 2,284

shares of our common stock reflecting a conversion price equal to $ 4.815.

NOTE 9 – EQUITY (continued):

Pre-Funded Warrants are immediately exercisable at an exercise price of $ 0.0001 per share and will not expire until exercised in

The Warrants are immediately exercisable upon issuance at an exercise price of $ 1.3827 per share.

The Warrants have a term

of the earlier of (i) five years from the date of issuance and (ii) (A) in the case of the Series H Warrants, 20 trading days following

the Company’s public release of primary and secondary end points related to one year follow up study results from the Company’s

C-Guardians pivotal trial, (B) in the case of the Series I Warrants, 20 trading days following the Company’s announcement of

receipt of Premarket Approval (PMA) from the Food and Drug Administration, or FDA, for the CGuard Prime Carotid Stent System (135

cm), (C) in the case of the Series J Warrants, 20 trading days following the Company’s announcement of receipt of FDA approval

for the SwitchGuard transcarotid system and CGuard Prime 80 cm and (D) in the case on the Series K Warrants, 20 trading days following

the end of the fourth fiscal quarter after the fiscal quarter in which the first commercial sales of the CGuard Carotid Stent System

in the United States begin.

The Warrants may be exercised on a cashless basis if there is no effective registration statement registering

the shares underlying the warrants.

Company issued a total of 307,260 shares of its common stock in connection with the exercise of Pre-Funded Warrants to purchase 307,271

shares of common stock on a cashless basis.

As of December 31, 2023, there are Pre-Funded Warrants to purchase an aggregate

of 15,254,623 share of common stock outstanding.

to the full ratchet anti-dilution adjustment provisions in the respective certificate of designation for the Company’s Series

C Preferred Stock, the conversion price of the outstanding shares of the Series C Preferred Stock was reduced to $ 1.3827 per share,

effective as of the date of the securities purchase agreement entered for the Offering, and the number of shares of common stock

issuable upon conversion of the Series C Preferred Stock increased by 5,668 additional shares of common stock upon conversion of

the Series C Preferred Stock, based on 1,718 shares of Series C Preferred Stock outstanding as of May 16, 2023.

of December 31, 2023 and 2022, there were 1,718 shares of Series C Preferred Stock outstanding, convertible into an aggregate of

7,952 and 2,284 shares of the Company’s common stock, respectively with a total stated value of $ 10,997 .

of December 31, 2023, the Company has outstanding warrants to purchase an aggregate of 53,396,008 shares of common stock as follows:

SCHEDULE OF ISSUANCE OF WARRANTS TO PURCHASE COMMON STOCK

exercise price

Number of underlying

Series E Warrants

Series F Warrants

Series G Warrants

Series H Warrants

Series I Warrants

Series J Warrants

Series K Warrants

Underwriter Warrants

Total Warrants

of December 31, 2023, the Company has 155,000,000 authorized shares of capital stock, par value $ 0.0001 per share, of which 150,000,000

2 unchanged sentences

9 – EQUITY (continued):

to the current Section 102 of the Israeli Tax Ordinance, which came into effect on January 1, 2003, options may be granted through

a trustee (i.e., Approved 102 Options) or not through a trustee (i.e., Unapproved 102 Options).

As a result of an election made by

the Company under Section 102 of the Income Tax Ordinance, the Company will not be allowed to claim as an expense for tax purposes

in Israel the amounts credited to the employee as capital gains to the grantees, although it will generally be entitled to do so

in respect of the salary income component (if any) of such awards when the related tax is paid by the employee.

the years ended December 31, 2022 and 2021, the Company granted stock options to the CEO, employees, consultants and directors to

purchase a total of 154,508 and 225,225 , respectively, shares of the Company’s common stock.

The options have exercise prices

ranging from $ 2.61 -$ 2.97 and $ 3.89 -$ 10.05 per share, respectively, which were the fair market value of the company’s common

stock on the date of each respective grant.

The fair value of the above options, using the Black-Scholes pricing models, was approximately

$ 360,356 and $ 1,026,000 , respectively.

Of the 154,508 options granted during the year ended December 31, 2022, 109,839 options are

subject to a three -year vesting period, with one-third of such awards vesting each year and 44,669 options with performance conditions,

mainly related to clinical activities.

the years ended December 31, 2022 and 2021, the Company granted to the employees and directors 45,494 and 419,943 restricted stock,

respectively.

The fair value of these restricted stock was approximately $ 109,886 and $ 1,781,981 , respectively.

The restricted stock

are subject to a three-year vesting period, with one-third of such awards vesting each year.

the year ended December 31, 2021, the Company granted to the CEO 146,567 RSUs.

The fair value of these restricted

stock units was approximately $ 603,856 .

The RSUs granted during the year ended December 31, 2021, are subject to

a three -year vesting period, with one-third of such awards vesting each year.

TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

7 – EQUITY (continued):

SCHEDULE OF STOCK OPTIONS GRANTED

September 30, 2021, at our 2021 annual meeting of stockholders, our stockholders approved

our 2021 Equity Incentive Plan.

2021 Equity Incentive Plan provides for the granting of incentive stock options, nonqualified stock options, stock

appreciation rights, restricted stock, restricted stock units, performance awards, dividend equivalent rights, and other awards,

which may be granted singly, in combination, or in tandem.

of December 31, 2023, we had 7,731,618 shares of common stock available for future issuance under our 2021 Equity Incentive Plan.

following table summarizes information about stock options granted to employees:

ended December 31

- beginning of period

end of period

at the end of the period

SCHEDULE OF STOCK OPTIONS GRANTED

Year ended December 31

Number of options

exercise price

Number of options

Weighted average exercise price

Outstanding - beginning of period

Outstanding- end of period

Exercisable at the end of the period

following table summarizes information about stock options granted to non-employees:

ended December 31

average exercise price

- beginning of period

- end of period

at the end of the period

Year ended December 31

Number of options

Weighted average exercise price

Number of options

Weighted average exercise price

Outstanding - beginning of period

Outstanding - end of period

Exercisable at the end of the period

following table summarizes information about restricted stock granted to employees:

SCHEDULE OF RESTRICTED STOCK GRANTED TO EMPLOYEES

ended December 31

of restricted stock

- beginning of period

Split Adjustments

- end of period

Year ended December 31

Number of restricted stock

Outstanding - beginning of period

Outstanding - end of period

TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

2 unchanged sentences

SCHEDULE OF RESTRICTED STOCK UNIT GRANTED TO EMPLOYEES

ended December 31

- beginning of period

- end of period

Year ended December 31

Number of RSUs

Outstanding - beginning of period

Outstanding - end of period

following table provides additional information about all options outstanding and exercisable:

SCHEDULE OF ADDITIONAL INFORMATION ABOUT ALL OPTIONS OUTSTANDING AND EXERCISABLE

as of December 31, 2022

average remaining contractual life (years)

Outstanding as of December 31, 2023

Options outstanding

Weighted average remaining contractual life (years)

Options exercisable

$ 1.15 - 2.97

3 unchanged sentences

aggregate intrinsic value of the total exercisable options as of December 31, 2023 was approximately $ 10,983 .

weighted average fair value of options granted was $ 2.56 for the year ended December 31, 2022.

The weighted average fair value of options

granted was estimated using the Black-Scholes option-pricing model.

weighted average fair value of options granted to employees was $ 1.65 and $ 2.33 for the years ended December 31, 2023 and 2022, respectively.

The weighted average fair value of options granted was estimated using the Black-Scholes option-pricing model.

weighted average fair value of options granted to consultants was $ 1.50 and $ 2.57 for the years ended December 31, 2023 and 2022, respectively.

The weighted average fair value of options granted was estimated using the Black-Scholes option-pricing model.

weighted average fair value of restricted stock granted was $ 1.95 and $ 2.42 for the years ended December 31, 2023 and 2022, respectively.

weighted average fair value of RSU granted was $ 1.76 for the year ended December 31, 2023.

vesting period for outstanding stock options, restricted stock, and RSUs is typically three years, with one-third of the awards vesting

Additionally, some of our share-based awards to service providers are performance-based, vesting upon the achievement of specified

performance criteria related to clinical or marketing activities.

TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

9 – EQUITY (continued):

following table sets forth the assumptions that were used in determining the fair value of options granted to employees for the year

1 unchanged sentence

SCHEDULE OF FAIR VALUE OF OPTIONS GRANTED TO EMPLOYEES

ended December 31

interest rates

Year ended December 31

Expected life

5.125 - 6.5 years

Risk-free interest rates

3.58 %- 4.73 %

2 unchanged sentences

127.43 %- 130.93 %

TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

7 – EQUITY (continued):

Dividend yield

Company does not have sufficient historical exercise data to provide a reasonable basis upon which to estimate expected term.

5 unchanged sentences

The Company’s expected volatility is derived from its historical data.

of December 31, 2022, the total unrecognized compensation cost on employee and non-employee stock options, restricted stock and RSUs, related to unvested stock-based compensation, amounted to approximately $ 1.30 million.

This cost is expected to be recognized

over a weighted-average period of approximately 0.85 years.

This expected cost does not include the impact of any future stock-based

compensation awards.

of December 31, 2023, the total unrecognized compensation cost on employee and non-employee stock options, restricted stock and RSUs,

related to unvested stock-based compensation, amounted to approximately $ 7.18 million.

This cost is expected to be recognized over

a weighted-average period of approximately 0.97 years.

This expected cost does not include the impact of any future stock-based compensation

following table summarizes the allocation of total share-based compensation expense in the consolidated statements of operations:

SCHEDULE OF ALLOCATION OF TOTAL SHARE-BASED COMPENSATION EXPENSE

ended December 31

Year ended December 31

($ in thousands)

and development

and marketing

and administrative

Cost of revenues

Research and development

Sales and marketing

General and administrative

TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

10 – RELATED PARTIES TRANSACTIONS

May 10, 2021, the board of directors of the Company appointed a new member.

During the twelve months ended December 31, 2022 and 2021,

a consulting company whose founder and CEO is our new board member provided certain marketing services in the amount of $ 9,645 and $ 33,775 ,

respectively.

the twelve months ended December 31, 2023 and 2022, a consulting company whose founder and CEO is our board member provided certain

marketing services in the amount of $ 788 and $ 9,645 , respectively.

September 15, 2023, the board approved the company’s entry into a consultancy agreement with a member of the immediate family

of the CEO for certain administrative projects in connection with the Company’s expansion to the U.S.

until a full-time Company

employee is retained in such capacity.

Pursuant to the Consultancy Agreement, the Company will pay a fixed hourly fee of $ 50 for

a maximum of 20 hours per week and customary expenses.

The Company may terminate this Agreement for any reason or no reason, at any

time, upon 30 days prior written notice to consultant.

expenses for the year ended December 31, 2023, were $ 11,440 .

Receive Shares of Common Stock in lieu of Cash Compensation

the year 2023, certain non-employee directors elected to receive all or a portion of their cash retainer amount in shares of the Company’s

common stock under the 2021 Equity Incentive Plan.

For a director that made that election, a stock award under the 2021 Equity Incentive

Plan was paid quarterly on the first day of each next quarter (“Issuance Dates”) and became fully vested on the Issuance

The stock award was determined by dividing (x) the product of the cash retainer amount and percentage of the cash retainer amount

elected to be taken in shares by (y) the “Fair Market Value” (as defined in the 2021 Equity Incentive Plan) of a share on

the Issuance Dates.

the years ended December 31, 2023 the Company issued 52,129 shares of common stock to non-employee directors who elected to receive all

or a portion of their cash retainer amount for the nine months ended September 30, 2023 in shares of the Company’s common stock

under the 2021 Equity Incentive Plan.

of December 31, 2023, there was an accrual for $ 55,000 for director’s fees for the three months ended December 31, 2023.

Out of this an amount of $ 22,875 was paid in cash and $ 32,125 was issued in shares of the Company’s common stock under the 2021

Equity Incentive Plan.

On January 1, 2024 the Company issued 11,854 shares of common stock.

11 - TAXES ON INCOME:

3 unchanged sentences

Accordingly, the applicable federal corporate tax rate in 2023 is 21 %.

State tax may also apply.

the applicable state income tax rate in 2023 is 3.42%.

Ltd is taxed under Israeli tax laws.

3 unchanged sentences

tax rate of 17.15 %.

benefits under the Law for the Encouragement of Capital Investments, 1959 (the “Law”):

has been granted a “Beneficiary Enterprises” status under the Investment Law including Amendment No.

60 thereof, which

became effective in April 2005.

The tax benefits derived from any such Beneficiary Enterprise relate only to taxable profits attributable

to the specific program of investment to which the status was granted.

main benefit, to which InspireMD Ltd.

is entitled, conditional upon the fulfilling of certain conditions stipulated by the above law,

is a two-year exemption and five to eight years of a reduced tax rate of 10 % to 23 % from tax on income derived from beneficiary activities

in facilities in Israel.

The two-year exemption starts only when the Company starts to pay taxes after using all tax offsetting losses.

The tax benefit period is twelve years from the year of election, which means that after a year of election, the two-year exemption and

eight years of reduced tax rate can only be used within the next twelve years.

The Company elected the year 2011 as a year of election

and accordingly 2022 is the last year that would have entitled the Company tax benefits under this law.

TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

9 - TAXES ON INCOME (continued):

the event of a distribution of tax-exempt income attributable to “Beneficiary Enterprises” as a cash dividend, the Company

will be required to pay tax at a rate of 10% to 23% on the amount distributed, subject to certain conditions.

In addition, dividends

originating from income attributable to the “Beneficiary Enterprises” will be subject to a 20 % withholding tax.

InspireMD Ltd.

derive income from sources other than the “Beneficiary Enterprises” during the period of benefits, such income

shall be taxable at the regular corporate tax rate.

for entitlement to the benefits

entitlement to the above benefits is conditional upon InspireMD Ltd.

fulfilling the conditions stipulated by the law, regulations published

thereunder and the instruments of approval for the specific investments in approved assets.

In the event of failure to comply with these

conditions, the benefits may be cancelled, and InspireMD Ltd.

may be required to refund the amount of the benefits, in whole or in part,

with the addition of interest and linkage.

Company opted not to apply for Preferred Enterprise status (as defined in the Amendment of the Law for the Encouragement of Capital Investments,

11 - TAXES ON INCOME:

benefits under the Law for the Encouragement of Capital Investments, 1959 (the “Law”):

December 29, 2016, the Investment Law was amended (“73 Amendment”), which includes, inter alia, two new tax incentive opportunities.

These are the Preferred Technological Enterprise (“PTE”) and Special Preferred Technological Enterprise (“SPTE”).

In order to benefit from either of these options, a Company must meet certain qualifications and receive formal approval from the Israel

Innovation Authority (“IIA”) which allows the Company to use the reduced corporate tax rate of 12 % on its “Preferred

Technological Income” (earned from enterprises located in Development outside of Zone A) in the case of a “preferred technology

enterprise”, or 6 % on its “preferred technology income” (earned from enterprises located in Development Zone A or outside

it) in the case of a “special preferred technology enterprise”.

Additionally, any “technology income”, as this

term is defined by the Law, not classified as “preferred technology income” is subject to the corporate tax rate.

according to the provisions regarding “preferred technology enterprise” and “special preferred technology enterprise”

in the Law and the regulations thereunder, and to the extent the income is attributable to manufacturing, this income is classified as

“preferred income” and is taxed at 7.5 % or 16 % according to the development zone.

To the extent the income is from an intangible

asset used for marketing, it is subject to the normal corporate tax rate.

Additionally,

when income of a company originating from “preferred technology income” is distributed as dividend to a foreign-resident

corporation, tax withholding from the dividend is 4 %, provided that 90 % or more of that company’s shares are directly held by one

or more foreign corporations, and the profits resulted after they acquired the shares.

forward tax losses

16 unchanged sentences

SCHEDULE OF COMPONENTS OF LOSS BEFORE INCOME TAXES

ended December 31

Year ended December 31

($ in thousands)

before taxes on income:

Loss before taxes on income:

InspireMD, Inc.

TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

5 unchanged sentences

SCHEDULE OF CHANGES IN VALUATION ALLOWANCE

ended December 31

Year ended December 31

($ in thousands)

at the beginning of the year

during the year:

during the year (including foreign exchange rate effect)

at the end of the year

Balance at the beginning of the year

Changes during the year:

Losses during the year (including foreign exchange rate effect)

Balance at the end of the year

for Uncertain Tax position

2 unchanged sentences

SCHEDULE OF RECONCILIATION OF UNCERTAIN TAX POSITIONS

ended December 31,

Year ended December 31,

($ in thousands)

at beginning of period

in uncertain tax positions because of tax positions taken during the year

Balance at end of

Balance at beginning of period

Increase in uncertain tax positions because of tax positions taken during the year

Balance at end of period

summary of open tax years by major jurisdiction is presented below:

SCHEDULE OF OPEN TAX YEARS BY MAJOR JURISDICTION

TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

9 - TAXES ON INCOME (continued):

SCHEDULE OF DEFERRED INCOME TAX

($ in thousands)

for vacation and recreation pay

lease right of use assets

lease liabilities

forward tax losses

severance pay, net

Provision for vacation and recreation pay

Operating lease right of use assets

Operating lease liabilities

Share-based compensation

Carry forward tax losses

Accrued severance pay, net

tax assets noncurrent

Less-valuation

Less-valuation allowance

TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

12 - SUPPLEMENTARY FINANCIAL STATEMENT INFORMATION :

1 unchanged sentence

($ in thousands)

materials and supplies

TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

10 - SUPPLEMENTARY FINANCIAL STATEMENT INFORMATION (continued):

Finished goods

Work in process

Raw materials and supplies

OF ACCOUNTS PAYABLE AND ACCRUALS - OTHER

1 unchanged sentence

($ in thousands)

and employee institutions

vacation and recreation pay

trial accrual

Operating lease liabilities

Employees and employee institutions

Accrued vacation and recreation pay

Accrued expenses

Clinical trial accrual

Current Operating lease liabilities

Payable and Accruals - Other

3 unchanged sentences

SCHEDULE OF REVENUES ATTRIBUTED TO GEOGRAPHIC AREAS

ended December 31,

Year ended December 31,

($ in thousands)

SCHEDULE OF REVENUES ATTRIBUTED TO GEOGRAPHIC AREAS BY PRODUCT

ended December 31,

Year ended December 31,

($ in thousands)

MGuard Prime™ EPS

principal customers:

OF REVENUES ATTRIBUTED TO GEOGRAPHIC AREAS BY PRINCIPAL CUSTOMERS

ended December 31,

Year ended December 31,

tangible long lived assets are located in Israel.

14 - SUBSEQUENT EVENTS :

to Receive Shares of Common Stock in lieu of Cash Compensation

on January 1, 2023, non-employee directors may elect to receive all or a portion of their cash retainer amount in shares of the Company’s

common stock under the 2021 Equity Incentive Plan.

If a director makes that election, a stock award under the 2021 Equity Incentive Plan

will be paid quarterly on the first day of each quarter (“Grant Dates”) and will become fully vested on the Grant Dates.

The stock award will be determined by dividing (x) the product of the cash retainer amount and percentage of the cash retainer amount

elected to be taken in shares by (y) the “Fair Market Value” (as defined in the 2021 Equity Incentive Plan) of a share on

the Grant Dates.

If a director’s service on the board terminates for any reasons prior to a Grant Date, he/she will receive a pro

rata portion of shares or cash based on the number of days served on the board during the relevant quarter.

January 23, 2024, the Company granted 1,528,316 restricted shares of the Company’s common stock to employees and directors.

The shares to employees are subject to a three-year vesting period, with one-third of such awards vesting each year.

The shares to directors

are subject to a one-year vesting period.

January 23, 2024, the Company granted 563,499 restricted share units of the Company’s common stock to the chief executive

The shares are subject to a three-year vesting period, with one-third of such awards vesting each year.

January 23, 2024, the Company granted to employees and directors options to purchase a total of 669,464 shares of the Company’s

common stock.

The options have an exercise prices of $3.14 per share, which was the fair market value of the Company’s common

stock on the date of the grant.

The options to employees are subject to a three-year vesting period, with one-third of such awards vesting

The options to directors are subject to a one-year vesting period.

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 9A. Controls and Procedures