What changed in this filing

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Item 1A. Risk Factors

2021-03-24 compared with 2020-03-24 · 175 added, 266 removed, 261 unchanged (63% of the section changed)

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Related to Our Business

have a limited operating history, are not currently profitable and may never become profitable.

are not currently profitable and may never become profitable.

have incurred losses in every reporting period since we commenced business operations in 2010 and expect to continue to incur

significant losses for the foreseeable future.

Our net loss for the years ended December 31, 2019 and 2018 were $6,320,849,

and $5,574,163, respectively.

Our net loss applicable to common stockholders for the years ended December

31, 2020 and 2019 were $7,009,414, and $6,320,849, respectively.

As of December 31, 2020, our accumulated deficit was $33,105,008.

There is no assurance

that any revenues we generate will be sufficient for us to become profitable or to maintain profitability.

Our revenues for the

years ended December 31, 2019 and December 31, 2018 were $402,446 and $388,574, respectively, and our operating expenses for those

periods were $6,211,830 and $5,687,271, respectively.

Our current revenues are not sufficient to fund our operations.

predict when, if ever, we might achieve profitability and we are not certain that we will be able to sustain profitability, if

If we fail to achieve or maintain profitability, the market price of our securities is likely to be adversely affected.

There is no assurance that any revenues we generate will be sufficient for us to become profitable or to maintain profitability.

Our revenues for the years ended December 31, 2020 and December 31, 2019 were $807,488 and $402,446, respectively, and our operating

expenses for those periods were $5,914,299 and $6,211,830, respectively.

Our current revenues are not sufficient to fund

our operations.

We cannot predict when, if ever, we might achieve profitability and we are not certain that we will be able to

sustain profitability, if achieved.

If we fail to achieve or maintain profitability, the market price of our securities is likely

to be adversely affected.

will require additional financing to continue our operations, and there is no assurance that we will be able to obtain such financing

on acceptable terms, or at all.

In January 2020, we

completed two private placements consisting of shares of our newly created Series D and Series E Preferred Stock, warrants to

purchase additional shares of Series D Preferred Stock and warrants to purchase shares of our Common Stock resulting in net cash

proceeds to us of approximately $1,711,124.

Subject to the satisfaction of certain equity conditions, we have the right to force

the exercise of a portion of the warrants to purchase our Series D Preferred Stock which will result in gross cash proceeds of

Additionally, if all of the remaining warrants to purchase shares of Series D Preferred Stock and Common Stock are exercised

by the holders thereof, the potential gross cash proceeds to us will be $13,298,100.

Depending on the amount, if anything, we receive

from such exercises and the timing thereof, and the amount of revenues we are able to generate, we may need to raise additional

amounts to fund our operations, maintain compliance with the NASDAQ listing requirements and implement our business plan.

is no assurance as to the amount and availability of any required future financing or the terms thereof.

Such financing, if in

the form of equity, may be highly dilutive to our existing stockholders and may otherwise include onerous terms.

If in the form

of debt, such financing may include covenants and repayment obligations which may be difficult to meet and that could adversely

affect our business operations.

There is also significant uncertainty from the affect that the novel coronavirus may have on the

availability and type of financing.

To the extent that funds are not available to us, we may be required to delay, limit or terminate

our business operations and lose our NASDAQ listing.

limited operating history makes evaluation of our business difficult.

commenced business operations in 2010 and are continuing to develop our technologies and to implement our business plan.

to implement a successful business plan remains unproven, and there is no assurance that we will ever generate sufficient revenues

to sustain our business.

Our relatively short operating history, together with the other risks discussed in this “Risk Factors”

section, may make it difficult for you to evaluate our business in connection with making a decision about whether to invest in

our securities.

January 2021, we completed a public offering of shares of our Common Stock resulting in net cash proceeds to us

of approximately $4,532,444.

We will need to raise additional amounts to fund our operations, maintain compliance with

the NASDAQ listing requirements and implement our business plan.

There is no assurance as to the amount and availability of any

required future financing or the terms thereof.

Such financing, if in the form of equity, may be highly dilutive to our existing

stockholders and may otherwise include onerous terms.

If in the form of debt, such financing may include covenants and repayment

obligations which may be difficult to meet and that could adversely affect our business operations.

There is also significant

uncertainty from the affect that the novel coronavirus may have on the availability and type of financing.

To the extent that

funds are not available to us, we may be required to delay, limit or terminate our business operations and lose our NASDAQ listing.

operating history makes evaluation of our business difficult.

are continuing to develop our technologies and to implement our business plan.

Our ability to implement a successful business

plan remains unproven, and there is no assurance that we will ever generate sufficient revenues to sustain our business.

Our operating

history, together with the other risks discussed in this “Risk Factors”

section, may make it difficult for you to

evaluate our business in connection with making a decision about whether to invest in our securities.

face the risks normally associated with a new business.

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contracts with us.

are subject to government audits, and our failure to comply with applicable laws, regulations and standards could subject us to

civil and criminal penalties and administrative sanctions.

government agencies we contract with have the authority to audit and investigate our contracts with them.

As part of that process,

a government agency may review our performance on a contract, our pricing practices, our cost structure and our compliance with

applicable laws, regulations and standards.

If the agency determines that we have improperly allocated costs to a specific contract,

we will not be reimbursed for those costs and we will be required to refund the amount of any such costs that have been previously

If a government audit identifies improper activities by us or we otherwise determine that these activities have occurred,

we could be subject to civil and criminal penalties and administrative sanctions, including termination of contracts, forfeitures

of profits, suspension of payments, fines and suspension or disqualification from doing business with the government.

determination could adversely impact our ability to bid for Request for Proposals (“RFPs”) in one or more jurisdictions.

may not be able to effectively control and manage our growth, which would negatively impact our operations.

have operated our current line of business for approximately nine years, and we expect to grow in the near future as our business

develops and becomes established.

If our business grows as we anticipate, it will be necessary for us to manage our expansion

in an orderly fashion.

Any significant growth in our activities or in the market for our services will require extension of our

managerial, operational, marketing and other resources.

Future growth will also impose significant additional responsibilities

upon the members of management to identify, recruit, maintain, integrate, and motivate new employees.

Our failure to manage growth

effectively may lead to operational inefficiencies that will have a negative effect on our profitability.

Additionally, if our

growth comes at the expense of providing quality service and generating reasonable profits, our ability to successfully bid for

contracts and our profitability will be adversely affected.

We cannot assure investors that we will be able to effectively manage

any future growth we may experience.

have operated our current line of business for approximately ten years, and we expect to grow in the near future as our

business develops and becomes further established.

If our business grows as we anticipate, it will be necessary for us

to manage our expansion in an orderly fashion.

Any significant growth in our activities or in the market for our services will

require extension of our managerial, operational, marketing and other resources.

Future growth will also impose significant additional

responsibilities upon the members of management to identify, recruit, maintain, integrate, and motivate new employees.

to manage growth effectively may lead to operational inefficiencies that will have a negative effect on our profitability.

Additionally,

if our growth comes at the expense of providing quality service and generating reasonable profits, our ability to successfully

bid for contracts and our profitability will be adversely affected.

We cannot assure investors that we will be able to effectively

manage any future growth we may experience.

to obtain adequate insurance coverage could put us at risk for uninsured losses.

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financial condition.

are dependent on our Executive Chairman, President and Chief Executive Officer and other key personnel, and the loss of any of

these individuals could harm our business.

depend on Mark Ruport, our Executive Chairman, John Rice, our President and Chief Executive Officer, as well as key scientific

and other personnel.

The loss of any of these individuals could harm our business and significantly delay or prevent the achievement

of our business objectives.

In addition, our delivery of services will be labor-intensive:

when we are awarded a contract, we

may need to quickly hire project leaders and project management personnel.

The additional staff may also create a concurrent demand

for increased administrative personnel.

are dependent on our President and Chief Executive Officer and other key personnel, and the loss of any of these individuals could

harm our business.

depend on Mark Ruport, our President and Chief Executive Officer, as well as key scientific and other personnel.

The loss of any

of these individuals could harm our business and significantly delay or prevent the achievement of our business objectives.

addition, our delivery of services will be labor-intensive:

when we are awarded a contract, we may need to quickly hire project

leaders and project management personnel.

The additional staff may also create a concurrent demand for increased administrative

The success of our business will require that we attract, develop, motivate and retain:

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success in part depends on the ability to protect our intellectual property and proprietary technology.

To do so, we will be

required to prosecute patent applications and maintain patents, obtain new patents and pursue trade secret and other

intellectual property protection.

We filed thirty-three foreign and U.S.

patent applications pertaining to our

technology and rapid qualification of additive manufacturing for metal parts.

We have been awarded eleven U.S.

However, the efforts we have taken to protect our proprietary rights may not be sufficient or effective.

can be no assurance that our program for protection of intellectual property and proprietary technology will be sufficient to

protect our intellectual property and proprietary technology from competitors.

Our business is also subject to the risk that

our issued patents will not provide us with significant competitive advantages if, for example, a competitor was to

independently develop or obtain similar or superior technologies.

In addition, our issued patents may be challenged or

infringed upon by third parties.

The enforcement of intellectual property rights is subject to considerable uncertainty and

can be expensive and time-consuming.

Patent reform laws and court decisions interpreting such laws, may create additional

uncertainty around our ability to obtain and enforce patent protection.

Any significant impairment of our intellectual

property rights could harm our business and our ability to compete.

The unauthorized use of our intellectual property could

make it more expensive to do business and harm our operating results.

Proprietary trade secrets and unpatented know-how are

also very important to our business;

however, trade secrets are difficult to protect.

Our employees, consultants,

contractors, outside scientific collaborators and other advisors may unintentionally or willfully disclose our confidential

information to competitors, and confidentiality agreements may not provide an adequate remedy in the event of unauthorized

disclosure of confidential or proprietary information.

To do so, we will be required

to prosecute patent applications and maintain patents, obtain new patents and pursue trade secret and other intellectual property

We filed forty-four foreign and U.S.

patent applications pertaining to our IPQA®

technology and rapid qualification

of additive manufacturing for metal parts.

We have been awarded thirteen U.S.

patents and one foreign patent.

the efforts we have taken to protect our proprietary rights may not be sufficient or effective.

There can be no assurance that

our program for protection of intellectual property and proprietary technology will be sufficient to protect our intellectual

property and proprietary technology from competitors.

Our business is also subject to the risk that our issued patents will not

provide us with significant competitive advantages if, for example, a competitor was to independently develop or obtain similar

or superior technologies.

In addition, our issued patents may be challenged or infringed upon by third parties.

The enforcement

of intellectual property rights is subject to considerable uncertainty and can be expensive and time-consuming.

Patent reform

laws and court decisions interpreting such laws, may create additional uncertainty around our ability to obtain and enforce patent

Any significant impairment of our intellectual property rights could harm our business and our ability to compete.

The unauthorized use of our intellectual property could make it more expensive to do business and harm our operating results.

Proprietary trade secrets and unpatented know-how are also very important to our business;

however, trade secrets are difficult

Our employees, consultants, contractors, outside scientific collaborators and other advisors may unintentionally or

willfully disclose our confidential information to competitors, and confidentiality agreements may not provide an adequate remedy

in the event of unauthorized disclosure of confidential or proprietary information.

may be sued by third parties who claim that we have infringed their intellectual property rights.

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type of litigation.

services are subject to government regulation, changes in which may have an adverse effect on us.

business activities subject us to a variety of federal, state and local laws and regulations.

For example, we could be required

to comply with applicable provisions of the International Traffic in Arms Regulations (“ITAR”), as well as other export

controls and laws governing the manufacture and distribution of munitions technology.

Changes in the laws and regulations

applicable to our business activities may have an adverse effect on our operations and profitability by making it more expensive

and less profitable for us to do business.

Additionally, the market for our services depends largely on federal and state legislative

These programs can be modified or amended at any time by acts of federal and state governments.

Further, if additional

programs are not proposed or enacted, or if previously enacted programs are challenged, repealed or invalidated, our growth strategy

could be adversely impacted.

bylaws contain provisions indemnifying our officers and directors against all costs, charges, and expenses incurred by them.

Bylaws contain provisions with respect to the indemnification of our officers and directors against all costs, charges and expenses

actually and reasonably incurred by an officer or director paid to settle an action or satisfy a judgment in a civil, criminal

or administrative action or proceeding to which he is made a party by reason of being or having been one of our directors or officers.

bylaws contain provisions with respect to the indemnification of our officers and directors against all costs, charges

and expenses actually and reasonably incurred by an officer or director paid to settle an action or satisfy a judgment in a civil,

criminal or administrative action or proceeding to which he is made a party by reason of being or having been one of our directors

To the extent that our directors’

and officers’

insurance policy does not provide reimbursement for such costs, charges,

expenses and other amounts, we may incur substantial expenses in satisfying our indemnification obligations.

insurance policy does not provide reimbursement for such

costs, charges, expenses and other amounts, we may incur substantial expenses in satisfying our indemnification obligations.

operating costs could be significantly higher than we expect, and this could reduce our future profitability.

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any information security vulnerabilities.

results of opera tions may be negatively impacted by the coronavirus outbreak.

In December 2019, the 2019 novel coronavirus surfaced in Wuhan,

The World Health Organization declared a global emergency on January 30, 2020, with respect to the outbreak and several

countries, including the United States have initiated travel restrictions, and residents of several territories are currently under

so-called Stay-at-Home orders.

The impacts of the outbreak are unknown and rapidly evolving.

widespread health crisis could adversely affect the global economy, resulting in an economic downturn that could impact demand

for our technology and products.

To date the outbreak has not had a material adverse impact on our operations.

However, the future

impact of the outbreak is highly uncertain and cannot be predicted and there is no assurance that the outbreak will not have a

material adverse impact on the future results of the Company.

The extent of the impact, if any, will depend on future developments,

including actions taken to contain the coronavirus.

results of operations may be negatively impacted by the coronavirus outbreak.

outbreak of the novel coronavirus (COVID-19) has evolved into a global pandemic.

The extent to which the coronavirus impacts our

business and operating results will depend on future developments that are highly uncertain and cannot be accurately predicted,

including new information that may emerge concerning the coronavirus and the actions that contain the coronavirus or treat its

impact, among others.

spread of the coronavirus, which has caused a broad impact globally, including restrictions on travel and quarantine policies

put in place by businesses and governments, may have a material economic effect on our business.

To-date, the outbreak has not

had a material adverse impact on our operations, though we have experienced delays in certain customer purchase orders.

the Company believes that such purchase orders will ultimately be realized, it is impossible to predict the timing.

future impact of the outbreak is highly uncertain and cannot be predicted and there is no assurance that the outbreak will not

have a material adverse impact on the future results of the Company.

Additionally, the coronavirus has already caused, and is

likely to result in further, significant disruption of global financial markets, which may reduce our ability to access capital

either at all or on favorable terms.

Related to Our Securities

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and could be subject to wide fluctuations in the future in response to various factors, some of which are beyond our control.

The trading price of the warrants that we issued in our recent public offering could be subject to similar fluctuations as a result

of such factors.

The trading price of the warrants that we issued in our 2017 public offering could be subject to similar fluctuations as

a result of such factors.

These factors include those discussed previously in this “Risk Factors”

section and others, such

section and others,

or failures in the commercialization of our current or future products and services;

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we are found to be at fault in connection with a decline in our market price of our securities.

active trading market in our securities may not develop, and you may therefore have difficulty selling your securities at a price

that you determine is satisfactory.

our common stock and the 2017 warrants are listed on The NASDAQ Capital Market, our common stock and warrants trade infrequently

and in low volumes.

There is no assurance that such securities will trade in the public market at or above a price that you consider

Furthermore, there is no assurance that an active trading market for any of our securities will develop or be sustained.

If an active market for our securities does not develop or is not maintained, it may be difficult for you to sell your securities

when you wish to sell them or at a price that you consider satisfactory.

An inactive trading market may also impair our ability

to raise capital to continue to fund operations by selling securities and may impair our ability to acquire other companies or

technologies by using our securities as consideration.

Historically,

there has been a limited trading market in our common stock,

and you may therefore have difficulty selling your securities at a price that you determine is satisfactory.

common stock is listed on The Nasdaq Capital Market.

Historically, there has been a limited trading market for our common stock.

There is no assurance that our common stock will actively trade in the public market at or above a price that you consider acceptable.

If an active market for our common stock is not maintained, it may be difficult for you to sell your shares of common stock when

you wish to sell them or at a price that you consider satisfactory.

An inactive trading market may also impair our ability to

raise capital to continue to fund operations by selling securities and may impair our ability to acquire other companies or technologies

by using our securities as consideration.

is no assurance that we will satisfy the continued listing requirements of The NASDAQ Capital Market.

We cannot assure you that

we will be able to satisfy or regain compliance with the continued listing requirements of The Nasdaq Capital Market.

there is no assurance that we will be able to satisfy all of the quantitative continued listing requirements, including the minimum

stockholders’

cannot assure you that we will be able to continue to satisfy the continued listing requirements of The Nasdaq Capital Market.

For example, there is no assurance that we will be able to satisfy all of the quantitative continued listing requirements, including

the minimum stockholders’

equity requirement of at least $2,500,000 for continued listing on The Nasdaq Capital Market,

2019, Nasdaq notified us that we did not comply with the minimum $2,500,000 stockholders’

equity requirement for continued

listing on The Nasdaq Capital Market under Nasdaq Listing Rule 5550(b)(1).

In our Form 8-K filed on September 4, 2019, we disclosed

that we had regained compliance with such rule as a result of our August 2019 underwritten public offering.

On October 8, 2019,

we received a letter from Nasdaq notifying us that, as a result of such offering, Nasdaq determined that we were in compliance

with the minimum $2,500,000 stockholders’

equity requirement for continued listing on The Nasdaq Capital Market under Nasdaq

Listing Rule 5550(b)(1), but that if we do not demonstrate continued compliance with such rule as of December 31, 2019, the Company’s

common stock may be subject to delisting.

On January 7, 2020, we received a letter from Nasdaq notifying the Company that we are

no longer in compliance with the minimum stockholders’

equity requirement for continued listing on the Nasdaq Capital Market.

On February 4, 2020 we submitted to Nasdaq our plan to regain compliance.

On March 18, 2020, we received a letter from Nasdaq

notifying us that our plan was accepted.

Accordingly, the Company must provide an update to Nasdaq by April 15, 2020 regarding

the status of any exercises of warrants issued in the January 2020 private placement, and by June 30, 2020, the Company must evidence

compliance with the stockholders’

equity requirement.

There can be no assurance that the Company will be able to regain

If the Company does not evidence compliance by June 30, 2020, or if the Company fails to satisfy another Nasdaq

requirement for continued listing, Nasdaq could provide notice that the Company’s common stock will become subject to delisting.

In such event, Nasdaq rules would permit the Company to appeal the decision to reject the Company’s proposed compliance

plan or any delisting determination to a Nasdaq Hearings Panel.

If our securities are de-listed from The Nasdaq Capital Market,

our stockholders could incur material adverse consequences such as reduced liquidity for their securities and reduced market prices

for their securities.

Following such de-listing, we could encounter increased difficulty in issuing additional securities at an

attractive price, or at all, in order to fund our operations.

which we have previously failed to satisfy.

If we fail to satisfy a Nasdaq requirement for continued listing, Nasdaq could provide

notice that our common stock will become subject to delisting.

In such event, Nasdaq rules would permit us to appeal the decision

to reject our proposed compliance plan or any delisting determination to a Nasdaq Hearings Panel.

If our securities are de-listed

from The Nasdaq Capital Market, our stockholders could incur material adverse consequences such as reduced liquidity for their

securities and reduced market prices for their securities.

Following such de-listing, we could encounter increased difficulty

in issuing additional securities at an attractive price, or at all, in order to fund our operations.

may experience additional dilution as a result of future equity offerings.

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our common stock.

have broad discretion in the use of the net proceeds of our recent public and private offerings and may not use them effectively.

have broad discretion in the use of the net proceeds of our recent public offering and may not use them effectively.

intend to use our cash for the development of our products and services.

Our management has broad discretion in the use

of cash and will have the right to use our cash in ways that differ substantially from our current plans.

Management may spend

our cash in ways that do not improve our results of operations or enhance the value of our securities.

The failure by management

to apply funds effectively could result in financial losses that could have a material and adverse effect on our business and

cause the market price of our securities to decline.

Our management has broad discretion in the use of cash

and will have the right to use our cash in ways that differ substantially from our current plans.

Management may spend our cash

in ways that do not improve our results of operations or enhance the value of our securities.

The failure by management to apply

funds effectively could result in financial losses that could have a material and adverse effect on our business and cause the

market price of our securities to decline.

do not intend to pay dividends on our common stock, and your ability to achieve a return on your investment will depend on appreciation

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of a substantial number of shares of our common stock in the public market could cause our stock price to fall.

Sales of a substantial

number of shares of our common stock in the public market could occur at any time.

These sales, or the perception in the market

that the holders of a large number of shares intend to sell shares, could reduce the market price of our common stock.

As of December

31, 2019, we had 1,403,759 outstanding shares of common stock.

Sales of a large number of the shares described in the preceding

sentence or upon exercise of our outstanding warrants and stock options, or the perception that a large number of shares may be

sold, could have a material adverse effect on the trading price of our common stock.

On January 27, 2020, we entered into a

Securities Purchase Agreement (the “SPA”) with certain institutional investors (the “Institutional Private Placement”).

Pursuant to the SPA, we issued and sold 1,640 shares of the Company’s Series D Convertible Preferred Stock, warrants to

purchase 779,600 shares of the Company’s Common Stock (the “Common Warrants”) and warrants to purchase 6,156

shares of the Series D Preferred Stock (the “Preferred Warrants”).

The Series D Preferred Stock has an initial stated

value of $1,000 per share (the “Stated Value”).

Dividends at a dividend rate of 9% per annum of Stated Value will

accrue and, on a monthly basis, will be payable in kind by the increase of the Stated Value of the Series D Preferred Shares by

The holders of the Series D Preferred Shares will have the right to convert the Series D Preferred Shares (including,

without limitation, make-whole dividends (the amount of any dividends that, but for the conversion, would have accrued at the

dividend rate for the period through the third anniversary of the initial issuance date)) into shares of the Company’s Common

Stock (the “Conversion Shares”) at the conversion price then in effect (initially $10.00).

A holder may at any time

convert the Series D Preferred Shares at an alternative conversion price, equal to the lower of the applicable conversion price

then in effect, and the greater of (x) $1.80 and (y) 85% of the average volume weighted average price (“VWAP”) of

our Common Stock for a five (5) trading day period prior to such conversion.

The initial exercise price of the Common Warrants

The Preferred Warrants have a term of one year from the date that the securities referenced in the SPA become fully

We have the right to force the exercise of up to 512 Preferred Warrants subject to certain equity conditions, which

would result in gross proceeds to us of approximately $500,000.

The initial exercise price for the Preferred Warrants is $975

As a result of the Institutional Private Placement, if all the Series

D Preferred Shares are converted at the lowest possible conversion price ($1.80) and all the Common Warrants are exercised at the

initial exercise price of $10.00 per share, we will be obligated to issue an aggregate of 6,280,111 shares.

A registration statement

covering the resale of such shares has been declared effective, and, as of March 20, 2020, 217,667 shares have been issued pursuant

to the conversion of Series D Preferred Shares and sold into the public market.

We anticipate that the holders of the Series D

Preferred Shares will continue to convert their preferred shares and publicly sell the resulting common shares which will likely

put pressure on the market price of our stock.

Concurrently with the Institutional Private Placement, we also sold 333.33 shares

of our Series E Preferred Stock and warrants to purchase 48,544 shares of our common stock.

The Series E Preferred Stock is initially

convertible into 48,544 shares of Common Stock.

We also issued to Dawson James Securities, Inc.

our placement agreement in these

private placements, warrants to purchase up to 17,004 shares of our common stock.

of a substantial number of shares of our common stock in the public market could occur at any time.

These sales, or the perception

in the market that the holders of a large number of shares intend to sell shares, could reduce the market price of our common

As of December 31, 2020, we had 5,995,320 outstanding shares of common stock.

On January 12, 2021, we closed a public

offering in which we issued an additional 1,711,783 shares of our common stock.

Sales of a large number of the shares such

as described in the preceding sentence or upon exercise of our outstanding warrants and stock options, or the perception

that a large number of shares may be sold, could have a material adverse effect on the trading price of our common stock.

will incur significant costs to ensure compliance with U.S.

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governance requirements, including requirements under the Sarbanes-Oxley Act of 2002 and other rules implemented by the SEC and

These applicable rules and regulations also make it more difficult and more expensive for us to obtain director and officer

liability insurance and we may be required to accept reduced policy limits and coverage or incur substantially higher costs to

obtain the same or similar coverage.

As a result, it may be difficult for us to attract and retain qualified individuals to serve

on our board of directors or as executive officers.

These applicable rules and regulations also make it more difficult and more expensive for us to obtain director

and officer liability insurance and we may be required to accept reduced policy limits and coverage or incur substantially higher

costs to obtain the same or similar coverage.

As a result, it may be difficult for us to attract and retain qualified individuals

to serve on our board of directors or as executive officers.

we fail to maintain effective internal control over financial reporting, the market price of our securities may be adversely affected.

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requirement that a special meeting of stockholders may be called only by the chairman of the board of directors, the chief

executive officer, the president or the board of directors, which may delay the ability of our stockholders to force consideration

of a proposal or to take action, including the removal of directors;

executive officer, the president (in the absence of a chief executive officer) or the board of directors, which may

delay the ability of our stockholders to force consideration of a proposal or to take action, including the removal of directors;

notice procedures that stockholders must comply with in order to nominate candidates to our board of directors or to propose

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a solicitation of proxies to elect the acquirer’s own slate of directors or otherwise attempting to obtain control of

ability of our directors to issue one or more series of preferred stock with dividend,

liquidation, conversion, voting or other rights which would dilute the interest of or

impair the voting power of our common stockholders.

ability of our directors to issue one or more series of preferred stock with dividend, liquidation, conversion, voting or

other rights which would dilute the interest of or impair the voting power of our common stockholders.

provisions could inhibit or prevent possible transactions that some stockholders may consider attractive.

recently issued Series D and Series E Preferred Stock and could issue one or more additional series of shares of preferred stock

with the effect of diluting existing stockholders and impairing their voting and other rights.

As indicated above,

we have recently completed the sale of shares of our Series D and Series E Preferred Stock together with warrants to purchase

our common stock and additional shares of our Series D Preferred Stock.

In addition to the possible negative effect on the market

price of our common shares resulting from the public sale or perceived sale of common shares issuable upon conversion or exercise

of these securities, the Certificate of Designations for the Series D Preferred Stock provides that upon occurrence of certain

triggering events described in the Certificate, including but not limited to, payment defaults, breaches of the transaction documents

pertaining to the Series D Preferred Stock and failure to maintain listing on the NASDAQ Capital Market, the Series D Preferred

Shares would become subject to redemption, at the option of the holder, at a 125% premium to the underlying value of the Series

D Shares being redeemed.

Any redemption would require a significant cost outlay by us.

could issue one or more additional series of shares of preferred stock with the effect of diluting existing stockholders and impairing

their voting and other rights.

Board of Directors is authorized to issue up to 10,000,000 shares of preferred stock and may determine the terms of future preferred

stock offerings without further action by our stockholders.

If we issue preferred stock, it could affect your rights or reduce

the value of our outstanding common stock.

In particular, specific rights granted to future holders of preferred stock may include

voting rights, preferences as to dividends and liquidation, conversion, and redemption rights, sinking fund provisions, and restrictions

on our ability to merge with or sell our assets to a third party.

As of December 31, 2020, 715 shares of our preferred stock are

outstanding, consisting of 382 shares of Series D Preferred Stock and 333 shares of Series E Preferred Stock.

addition to the possible negative effect on the market price of our common shares resulting from the public sale or perceived

sale of common shares issuable upon conversion or exercise of these securities, the Certificate of Designations for the Series

D Preferred Stock provides that upon occurrence of certain triggering events described in the Certificate, including but not limited

to, payment defaults, breaches of the transaction documents pertaining to the Series D Preferred Stock and failure to maintain

listing on the NASDAQ Capital Market, the Series D Preferred Shares would become subject to redemption, at the option of the holder,

at a 125% premium to the underlying value of the Series D Shares being redeemed.

UNRESOLVED STAFF COMMENTS.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors