What changed in this filing

/stocks — the workspaceLOADING

Item 5. Market for Registrant’s Common Equity

2022-04-06 compared with 2021-03-15 · 48 added, 735 removed, 1 unchanged (100% of the section changed)

Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities - continued

Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

for Common Equity

common equity is traded on the Nasdaq Capital Market under the symbols:

“PAVM.” with respect to our

common stock;

“PAVMZ” and “PAVMW” with respect to each of our Series Z Warrants and Series W Warrants,

respectively.

Subsequent to December 31, 2021 the Series W Warrants issued and outstanding as of December 31, 2021, expired unexercised

on January 29, 2022.

of March 29, 2022, there were 87,667,406 shares of our common stock outstanding.

Our shares of common stock are held by an estimated

17,000 holders of record and we believe our shares of common stock are held by more than beneficial owners.

have not paid any cash dividends on our common stock to date.

Any future decisions regarding dividends will be made by our board of directors.

We do not anticipate paying dividends in the foreseeable future but expect to retain earnings to finance the growth of our business.

Our board of directors has complete discretion on whether to pay dividends.

Even if our board of directors decides to pay dividends,

the form, frequency and amount will depend upon our future operations and earnings, capital requirements and surplus, general financial

condition, contractual restrictions, amongst and other factors deemed relevant.

B Convertible Preferred Stock

Series B Convertible Preferred Stock is issued pursuant to the PAVmed Inc.

Certificate of Designation of Preferences, Rights, and Limitations

of Series B Convertible Preferred Stock (“Series B Convertible Preferred Stock Certificate of Designation”), has a par value

of $0.001 per share, no voting rights, a stated value of $3.00 per share, and at the holders’ election, shares of Series B Convertible

Preferred Stock is immediately convertible upon issuance into a corresponding number of shares of common stock of PAVmed Inc.

Series B Convertible Preferred Stock Certificate of Designation provides for dividends at a rate of 8% per annum based on the $3.00 per

share stated value, with such dividends compounded quarterly, accumulate, and are payable in arrears upon being declared by the Company’s

board of directors, with the dividends earned from April 1, 2018 through October 1, 2021 payable-in-kind (“PIK”) by the issue

of additional shares of Series B Convertible Preferred Stock.

The dividends may be settled after October 1, 2021, at the election of

the Company, through any combination of the issuance of shares of Series B Convertible Preferred Stock, shares of common stock of the

Company, and /or cash payment.

the years ended December 31, 2021 and 2020, respectively, at each of the respective holders’ election, a total of

210,448 and 25,000 shares of Series B Convertible Preferred Stock were converted into the same number of shares of common stock

of PAVmed Inc.

the year ended December 31, 2021, the Company’s board-of-directors declared an aggregate of approximately $288 of Series B Convertible

Preferred Stock dividends, earned as of December 31, 2020, March 31, 2021, June 30, 2021, and September 30, 2021, which have been settled

by the issue of an additional aggregate 96,292 shares of Series B Convertible Preferred Stock.

During the year ended December 31,

2020, the Company’s board-of-directors declared an aggregate of approximately $284 of Series B Convertible Preferred Stock dividends,

earned as of December 31, 2019, March 31, 2020, June 30, 2020, and September 30, 2020, which have been settled by the issue of an additional

aggregate 94,866 shares of Series B Convertible Preferred Stock.

to December 31, 2021, in January 2022, the Company’s board-of-directors declared a Series B Convertible Preferred Stock dividend

earned as of December 31, 2021 and payable as of January 1, 2022, of approximately $67, which will be settled by the issue of an additional

22,291 shares of Series B Convertible Preferred Stock (with such dividend not recognized as a dividend payable as of December 31, 2021,

as the Company’s board of directors had not declared such dividends payable as of such date).

Sales of Unregistered Securities

as previously disclosed in our current reports on Form 8-K and quarterly reports on Form 10-Q, we did not sell any unregistered

securities or repurchase any of our securities during the fiscal year ended December 31, 2020.

Selected Financial Data

Management’s Discussion and Analysis of Financial Condition and Results of Operations

following discussion and analysis of our consolidated financial condition and results of operations should be read together with

our consolidated financial statements and related notes appearing elsewhere in this Annual Report on Form 10-K.

Some of the information

contained in this discussion and analysis or set forth elsewhere in this Annual Report on Form 10-K, including information with

respect to our plans and strategy for our business and related financing, includes forward-looking statements involving risks

and uncertainties and should be read together with the “Forward-Looking Statements”

and “Risk Factors”

sections of this Annual Report on Form 10-K for a discussion of important factors which could cause actual results to differ materially

from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

Unless the context otherwise requires, references herein to “we”, “us”, and “our”, and to

the “Company”

or “PAVmed”

are to PAVmed Inc.

and its subsidiaries.

and Subsidiaries (“PAVmed”

or “the Company”) is a highly differentiated, multi-product, commercial-stage

technology medical device company organized to advance a broad pipeline of innovative medical technologies from concept to commercialization,

employing a business model focused on capital efficiency and speed to market.

Since inception on June 26, 2014, the Company’s

activities have focused on advancing its lead products towards regulatory approval and commercialization, protecting its intellectual

property, and building its corporate infrastructure and management team.

Company operates in one segment as a medical device company currently organized as “GI Health”, “Minimally Invasive

Interventions”, “Infusion Therapy”, and “Emerging Innovations”.

The Company has ongoing operations

conducted through PAVmed Inc.

and its majority-owned subsidiaries of Lucid Diagnostics, Inc.

(“Lucid Diagnostics”

or “LUCID”), and Solys Diagnostics, Inc.

(“Solys Diagnostics”

or “SOLYS”).

and /or its subsidiaries have proprietary rights to the trademarks used herein, including, among others, PAVmed™, Lucid

Diagnostics™, Caldus™, CarpX ®

, DisappEAR™, EsoCheck ®

, EsoGuard ®

EsoCheck Cell Collection Device ®

, EsoCure Esophageal Ablation Device™, NextCath™, NextFlo™, PortIO™,

and “Innovating at the Speed of Life”™.

Solely as a matter of convenience, trademarks and trade names referred

to herein may or may not be accompanied with the requisite marks of “™”

or “®”, however, the

absence of such marks is not intended to indicate, in any way, PAVmed Inc.

or its subsidiaries will not assert, to the fullest

extent possible under applicable law, their respective rights to such trademarks and trade names.

multiple products and services are in various phases of development, regulatory clearances, approvals, and commercialization.

EsoCheck device received 510(k) marketing clearance from the U.S.

Food and Drug Administration (“FDA”), in June

2019 as an esophageal cell collection device;

and, EsoGuard has been established as a Laboratory Developed Test (“LDT”),

and was launched commercially in December 2019 after Clinical Laboratory Improvement Amendment (“CLIA”) and College

of American Pathologists accreditation of the test at Lucid Diagnostics commercial diagnostic laboratory partner ResearchDx

Inc., headquartered in Irvine, California.

CarpX device is a patented, single-use, disposable, minimally-invasive surgical device designed as a precision cutting tool

to treat carpal tunnel syndrome while reducing recovery times that was cleared by the FDA under section 510(k) on April 2020

and was launched commercially in August 2020 with the first commercial procedure successfully performed in December 2020.

other products in development have not yet received clearance or approval to be marketed or sold in the U.S.

or elsewhere.

We have been granted patents by the United States Patent and Trademark Office (“USPTO”) for CarpX, PortIO, and

and have acquired licenses to certain patents and intellectual property for:

DisappEAR from Tufts University and a

group of academic centers;

the intellectual property licensed from Case Western Reserve University (“CWRU”) underlying

the technology developed for the EsoGuard diagnostic LDT and the EsoCheck cell sample collection device;

and for patents covering

a proprietary nondispersive infrared technology to non-invasively detect glucose in tissue within the in-patient field of

use from Liquid Sensing, Inc.

(an unrelated third-party).

Management’s Discussion and Analysis of Financial Condition and Results of Operations - continued

discussed herein below, our current lines-of-business are as follows:

Health - EsoGuard Esophageal DNA Laboratory Developed Test, EsoCheck Esophageal Cell Collection Device,

and EsoCure Esophageal Ablation Device with Caldus Technology;

Invasive Interventions - CarpX Minimally Invasive Surgical Device for Carpal Tunnel Syndrome;

Therapy - PortIO Implantable Intraosseous Vascular Access Device and NextFlo Highly Accurate Disposable

Intravenous Infusion Platform Technology;

Innovations - Non-invasive laser-based glucose monitoring, single-use ventilators, resorbable pediatric ear tubes

and mechanical circulatory support cannulas.

EsoCheck, and EsoCure

and EsoCheck are based on patented technology licensed from Case Western Reserve University (“CWRU”) through our majority-owned

subsidiary Lucid Diagnostics Inc.

EsoGuard and EsoCheck have been developed to provide an accurate, non-invasive, patient-friendly

screening test for the early detection of adenocarcinoma of the esophagus (“EAC”) and Barrett’s Esophagus (“BE”),

including dysplasia and related pre-cursors to EAC in patients with chronic gastroesophageal reflux (“GERD”).

is based on our patented Caldus Technology developed by us to treat BE.

is a molecular diagnostic esophageal DNA test shown in a published human study to be highly accurate at detecting BE, as well

EsoCheck is a non-invasive cell collection device designed to sample cells from a targeted region of the esophagus in

a five-minute office-based procedure, without the need for endoscopy.

Both EsoGuard and EsoCheck are commercially available, as

separately marketed products, for physicians to prescribe for U.S.

is in development as an “Esophageal Ablation Device”

with the intent to allow a clinician to treat dysplastic BE before

it can progress to EAC, a highly lethal esophageal cancer, and to do so without the need for complex and expensive capital equipment.

We have successfully completed a pre-clinical feasibility animal study of EsoCure demonstrating excellent, controlled circumferential

ablation of the esophageal mucosal lining.

We plan to conduct additional development work and animal testing of EsoCure to support

a planned FDA 510(k) submission later in 2021.

are currently marketing the EsoGuard diagnostic LDT through a network of independent representatives working with our in-house

sales management.

Center for Medicare and Medicaid Services (“CMS”), finalized the Clinical Laboratory Fee

Schedule determination for the EsoGuard Esophageal DNA Test (CPT code 0114U) in the amount of $1,938.10, with such reimbursement

expected to be applicable from January 1, 2021 to December 31, 2023.

In addition, we have entered into a manufacturing agreement

with medical device contract manufacturer Coastline International Inc.

to serve as a high-volume, lower-cost manufacturer of the

EsoCheck device.

longer-term strategy is to secure a specific indication, based on published guidelines, for BE screening in certain at-risk populations

using EsoGuard on samples collected with EsoCheck.

This use of EsoGuard together with EsoCheck as a screening system must be cleared

or approved by the FDA as an in vitro diagnostic (“IVD”), device.

In September 2019, we entered into an agreement

with a clinical research organization to assist us with two ongoing clinical trials for EsoGuard as an IVD device, which are actively

enrolling patients and consist of a screening study (ESOGUARD-BE-1) and a case control study (ESOGUARD-BE-2).

Management’s Discussion and Analysis of Financial Condition and Results of Operations - continued

Health - continued

February 2020, we received a FDA “Breakthrough Device Designation”

for EsoGuard as an IVD device.

The FDA Breakthrough

Device Program was created to offer patients more timely access to breakthrough technologies which provide for more effective

treatment or diagnosis of life-threatening or irreversibly debilitating human disease or conditions by expediting their development,

assessment and review through enhanced communications and more efficient and flexible clinical study design, including more favorable

pre/post market data collection balance.

have received ISO 13485:2016 certification for Lucid Diagnostics quality management system and filed a European Union CE Mark

regulatory submission for EsoCheck in November 2020, having confirmed that EsoGuard falls under the self-declaration category

of the European Union regulatory requirements.

Invasive Interventions

a minimally invasive surgical device for use in the treatment of carpal tunnel syndrome, received FDA 510(k) marketing clearance

in April 2020.

CarpX is a minimally invasive surgical device for use in the treatment of carpal tunnel syndrome.

We launched CarpX

commercially in August 2020 with the first commercial procedure successfully performed in December 2020.

believe CarpX is designed to allow the physician to relieve the compression on the median nerve without an open incision or the

need for endoscopic or other imaging equipment.

To use CarpX, the operator first advances a guidewire through the carpal tunnel

under the ligament, and then advanced over the wire and positioned in the carpal tunnel under ultrasonic and/or fluoroscopic guidance.

When the CarpX balloon is inflated it creates tension in the ligament positioning the cutting electrodes underneath it and creates

space within the tunnel, providing anatomic separation between the target ligament and critical structures such as the median

Radiofrequency energy is briefly delivered to the electrodes, rapidly cutting the ligament, and relieving the pressure

on the nerve.

We believe CarpX will be significantly less invasive than existing treatments.

are commercializing CarpX through a network of independent U.S.

sales representatives and/or inventory-stocking medical distributors

together with our in-house sales management and marketing teams.

Our focus on CarpX, and other high margin products and

services, is particularly suitable to this mode of distribution.

A high gross margin allows us to properly incentivize our distributors,

which in turn allows us to attract the top distributors with the most robust networks in our targeted specialties.

distributors play an even larger role in many parts of Europe, most of Asia and emerging markets worldwide.

may eventually choose to build (or obtain through a strategic acquisition) our own sales and marketing team to commercialize CarpX,

along with some or all of our products, if it is in our long-term interests.

We may also choose to enter into distribution agreements

with larger strategic partners whereby we take full responsibility for the manufacturing of CarpX but outsource some or all of

its distribution to a partner, particularly outside the United States, with its own robust distribution channels.

have received ISO 13485:2016 certification for PAVmed’s quality management system and filed a European Union CE Mark regulatory

submission for CarpX in December 2020.

Management’s Discussion and Analysis of Financial Condition and Results of Operations - continued

is a novel, patented, implantable, intraosseous vascular access device which does not require accessing the central venous system

and does not have an indwelling intravascular component.

It is designed to be highly resistant to occlusion and may not require

regular flushing.

It features simplified, near-percutaneous insertion and removal, without the need for surgical dissection or

radiographic confirmation.

It provides a near limitless number of potential access sites and can be used in patients with chronic

total occlusion of their central veins.

The absence of an intravascular component will likely result in a very low infection rate.

on encouraging animal data, we are preparing to initiate a long-term (60-day implant duration) first-in-human clinical study in

dialysis patients or those with poor venous access in Colombia, South America and intend to fulfill the likely FDA request for

human clinical data with a clinical safety study in the U.S.

following FDA clearance of our Investigational Device Exemption (“IDE”)

submission to begin clinical testing in dialysis patients to support a future de novo regulatory submission.

is a patented, disposable, and highly accurate infusion platform technology including intravenous, or “

infusion sets and disposable infusion pumps designed to eliminate the need for complex and expensive electronic infusion pumps

for most of the estimated one million infusions of fluids, medications and other substances delivered each day in hospitals and

outpatient settings in the U.S.

NextFlo is designed to deliver highly accurate gravity-driven infusions independent of the height

of the IV bag.

It maintains constant flow by incorporating a proprietary, passive, pressure-dependent variable flow-resistor consisting

entirely of inexpensive, easy-to-manufacture disposable mechanical parts.

NextFlo testing has demonstrated constant flow rates

across a wide range of IV bag heights, with accuracy rates comparable to electronic infusion pumps.

are seeking a long-term strategic partnership or acquiror.

We have been running a formal M&A process for NextFlo targeting

strategic and financial partners.

The process is active with ongoing discussion with multiple parties and we are simultaneously

progressing toward an initial FDA 510(k) submission for the NextFlo IV Infusion System planned for later in 2021.

Innovations include a diversified and expanding portfolio of innovative products designed to address unmet clinical needs across

a broad range of clinical conditions.

We are evaluating a number of these product opportunities and intellectual property covering

a wide spectrum of clinical conditions, which have either been developed internally or have been presented to us by clinician

innovators and academic medical institutions for consideration of a partnership to develop and commercialize these products.

collection of products includes, without limitation, initiatives in non-invasive laser-based glucose monitoring, mechanical circulatory

support cannulas, single-use ventilators and resorbable pediatric ear tubes.

In June 2020, we announced the execution of a letter

of intent to consummate a series of agreements to develop and utilize Canon Virginia’s commercial grade and scalable aqueous

silk fibroin molding process to manufacture PAVmed’s DisappEAR molded pediatric ear tubes for commercialization.

we are exploring other opportunities to grow our business and enhance shareholder value through the acquisition of pre-commercial

or commercial stage products and/or companies with potential strategic corporate and commercial synergies.

Management’s Discussion and Analysis of Financial Condition and Results of Operations - continued

the year ended December 31, 2020, we issued debt and equity resulting in approximately $35.9 million of gross proceeds, before

placement agent fees and expenses and offering costs, summarized as follows:

a private placement, we issued a Senior Secured Convertible Notes dated November 4, 2019, with a $14.0 million aggregate

face value principal, referred to herein as the “November 2019 Senior Convertible Notes”.

The November 2019 Senior

Convertible Notes were comprised of a Series A and Series B, each with a $7.0 million face value principal, and each having

a $0.7 million lender fee deducted from the cash proceeds when funded.

The Series A was funded in November 2019 and the Series

B was funded in March 2020.

issued the November 2019 Senior Convertible Note - Series B on March 30, 2020, with a face value principal of $7.0 million,

resulting in cash proceeds of $6.3 million after a $0.7 million of lender fee, and we additionally paid offering costs of

$0.4 million, consisting of a financial advisory fee paid to the placement agent.

As of December 31, 2020, the November

2019 Senior Convertible Notes (Series A and Series B) remaining unpaid outstanding face value principal was approximately

$1.0 million, which was repaid-in-full subsequent to December 31, 2020, as discussed herein below in Liquidity and Capital

issued a Senior Convertible Note, dated April 30, 2020, in a private placement, with a face value principal of $4.1 million,

resulting in cash proceeds of $3.7 million after a $0.4 million lender fee, and we additionally paid total offering costs

of $0.2 million, inclusive of a financial advisory fee paid to the placement agent and legal fees.

As of December 31, 2020,

the unpaid outstanding face value principal was $4.1 million, which was repaid-in-full subsequent to December 31, 2020,

as discussed herein below in Liquidity and Capital Resources .

issued a Senior Secured Convertible Note, dated August 6, 2020, in a private placement, with a face value principal of $7.75

million, resulting in cash proceeds of $7.0 million after a $0.75 million lender fee, and we additionally paid total offering

costs of $0.1 million of legal fees.

As of December 31, 2020, the unpaid outstanding face value principal was $7.75 million,

of which, subsequent to December 31, 2020, which was repaid-in-full subsequent to December 31, 2020, as discussed herein below

in Liquidity and Capital Resources .

December 2020, we issued a total of 10,647,500 shares of

our common stock for gross proceeds of $17.0 million, with cash proceeds of $16.0 million after the payment of a placement

agent fee and expenses of approximately $1.0 million, and we additionally paid offering costs of $0.1 million.

shares of our common stock were issued in two registered direct offerings pursuant to respective Prospectus Supplement

dated December 11, 2020 and December 18, 2020, each with respect to our effective shelf registration statement on Form S-3

to December 31, 2020, on January 5, 2021, we issued 6,000,000 shares of our common stock for gross proceeds of $13.4

million, with cash proceeds of $12.4 million, after the payment of $0.9 million of a placement agent fee and expenses, and

we additionally paid offering costs of $0.1 million.

The shares of our common stock were issued in a registered direct

offering pursuant to a Prospectus Supplement dated January 5, 2021 with respect to our effective shelf registration statement

on Form S-3 (File No.

to December 31, 2020, on February 23, 2021 we issued 9,782,609 shares of our common stock for proceeds of $41.6 million, before

underwriter expenses of $0.1 million, and we additionally incurred estimated offering costs of $0.4 million.

The shares of

our common stock were issued in an underwritten registered offering pursuant to a final Prospectus Supplement dated February

23, 2021 with respect to our effective shelf registration statement on Form S-3 (File No.

333-248709 and File No.

to December 31, 2020, as of March 12, 2021, a total of 773,842 Series Z Warrants were exercised for cash at a $1.60 per share

of our common stock, resulting in the issue of a corresponding number of shares of our common stock.

Management’s Discussion and Analysis of Financial Condition and Results of Operations - continued

of SARS-CoV-2 - COVID-19 Pandemic

in December 2019, there was an outbreak of a novel strain of a coronavirus occurred, with such coronavirus designated by the United

Nations (UN) World Health Organization (“WHO”) as the “Severe Acute Respiratory Syndrome Coronavirus 2”

- or “SARS-CoV-2”.

The SARS-CoV-2 spread on a global basis to other countries, including the United States of America

(“USA”

“U.S.”

or “United States”).

On March 11, 2020, the WHO declared a pandemic resulting

from SARS-CoV-2, with such pandemic commonly referred to by its resulting illness of “COVID-19”

(“coronavirus

disease-2019”), and is referred to herein as the “COVID-19 pandemic”.

The COVID-19 pandemic is ongoing, and

we continue to monitor the ongoing impact of the COVID-19 pandemic on the United States national economy, the global economy,

and our business.

COVID-19 pandemic may have an adverse impact on our operations, supply chains, and distribution systems and /or those of our contractors

of our laboratory partner, and increase our expenses, including as a result of impacts associated with preventive and precautionary

measures being taken, restrictions on travel, quarantine polices, and social distancing.

Such adverse impact may include, for

example, the inability of our employees and /or those of our contractors or laboratory partner to perform their work or curtail

their services provided to us.

expect the significance of the COVID-19 pandemic, including the extent of its effect on our consolidated financial condition and

consolidated operational results and cash flows, to be dictated by the success of United States and global efforts to mitigate

the spread of and /or to contain the SARS-CoV-2 and the impact of such efforts.

addition, the spread of the SARS-CoV-2 has disrupted the United States’

healthcare and healthcare regulatory systems which

could divert healthcare resources away from, or materially delay United States Food and Drug Administration (“FDA”)

approval with respect to our products.

our clinical trials have been and may be further affected by the COVID-19 pandemic, as site initiation and patient enrollment

may be delayed, for example, due to prioritization of hospital resources toward the virus and /or illness response, as well as

travel restrictions imposed by governments, and the inability to access clinical test sites for initiation and monitoring.

COVID-19 pandemic may have an adverse impact on the economies and financial markets of many countries, including the USA, resulting

in an economic downturn that could adversely affect demand for our products and services and /or our product candidates.

we are continuing to monitor and assess the effects of the COVID-19 pandemic on our business, the ultimate impact of the COVID-19

pandemic (or a similar health epidemic) is highly uncertain and subject to change, and therefore, its impact on our consolidated

financial condition, consolidated results of operations, and /or consolidated cash flows, the adverse impact could be material.

Management’s Discussion and Analysis of Financial Condition and Results of Operations - continued

of Operations

and administrative expenses

and administrative expenses consist primarily of salaries and related costs for personnel, travel expenses, facility-related costs,

professional fees, accounting and legal services, consultants and expenses associated with obtaining and maintaining patents within

our intellectual property portfolio.

anticipate our general and administrative expenses will increase in the future, as we anticipate an increase in payroll and related

expenses related to the roll-out of our commercial sales and marketing operations.

We also anticipate continued expenses related

to being a public company, including audit, legal, regulatory, and tax-related services associated with maintaining compliance

as a public company, insurance premiums and investor relations costs.

and development expenses

and development expenses are recognized in the period they are incurred and consist principally of internal and external expenses

incurred for the research and development of our products, including:

costs charged to us by various external contract research organizations we contract with to conduct preclinical studies and

engineering studies;

and benefit costs associated with our clinical and engineering personnel;

associated with regulatory filings;

license fees;

of laboratory supplies and acquiring, developing, and manufacturing preclinical prototypes;

design engineering studies.

plan to incur research and development expenses for the foreseeable future as we continue the development of our existing products

as well as new innovations.

Our research and development activities are focused principally on obtaining FDA approvals and developing

product improvements or extending the utility of the lead products in our pipeline, including CarpX, EsoCheck and EsoGuard, along

with advancing our DisappEAR, PortIO, NextFlo, and non-invasive glucose monitoring products through their respective development

Income and Expense, net

income and expense, net, consists principally of changes in fair value of our convertible notes, losses on extinguishment of debt

upon repayment of such convertible notes;

and interest expense recognized in connection with one of our convertible notes.

Management’s Discussion and Analysis of Financial Condition and Results of Operations - continued

ended December 31, 2020 versus December 31, 2019

and administrative expenses

the year ended December 31, 2020, general and administrative costs were approximately $12.4 million, compared to $7.7 million

for the year ended December 31, 2019.

The net increase of $4.7 million was principally related to:

approximately

$2.3 million increase in compensation related costs principally related to sales staffing levels and other costs related to

our commercial launch of EsoGuard and CarpX;

approximately

$2.0 million in consulting services related to patents, regulatory compliance, legal processes for contract review, and public

company expenses;

approximately

$0.3 million in general business expenses.

and development expenses

the year ended December 31, 2020, research and development costs were approximately $11.0 million as compared to $6.6 million

for the corresponding period in the prior year, with the approximate $4.4 million increase principally related to:

approximately

$4.0 million increase in clinical trial costs and outside professional and engineering services with respect to CarpX, NextFlo,

Port IO, EsoGuard and our glucose monitoring product;

approximately

$0.4 million increase in compensation related costs related to expanded clinical and engineering staff.

Income and Expense

in fair value of convertible debt

the year ended December 31, 2020, the (non-cash) expense recognized for the change in the fair value of our convertible notes

was approximately $6.0 million, inclusive of the recognition of other expense of approximately $1.9 million of lender fees incurred

with respect to the convertible notes, as compared to $1.1 million for the year ended December 31, 2019, resulting in an increase

of approximately $4.9 million principally related to:

increase in the face principal amount of our convertible notes of approximately $18.1 million, inclusive of $1.9 million in

other fair value input assumptions, an increase in the Company’s common stock price between the periods resulting in

a higher estimated fair value of the convertible notes;

total of approximately $1.9 million of lender fees recognized as other expense, inclusive of approximately $0.7 million with

respect to our November 2019 Senior Secured Convertible Note - Series B ;

approximately $0.4 million with respect to our April

2020 Senior Convertible Note;

and approximately $0.8 million with respect to our August 2020 Senior Secured Convertible Note.

These fees were $0.7 million in the corresponding prior year period with respect to our November 2019 Senior Convertible Note

Note 8, Financial Instruments Fair Value Measurement , and Note 9, Outstanding Debt , of our consolidated

financial statements for a further discussion of the change in fair value of our convertible notes, and “—Liquidity

and Capital Resources”, below.

from Extinguishment of Debt

the year ended December 31, 2020, a debt extinguishment loss of approximately $6.5 million was recognized in connection with the

Senior Secured Convertible Notes issued November 4, 2019 and December 27, 2018, with such debt extinguishment loss resulting from

the difference between the sum of the face value principal repayments and the corresponding interest thereon as compared to the

fair value of the shares of our common stock issued upon conversion of such convertible notes.

In the prior year period ended

December 31, 2019, a debt extinguishment loss of approximately $1.8 million was recognized in connection with the Senior Secured

Convertible Note issued December 27, 2018.

See Note 9, Outstanding Debt , of our consolidated financial statements for a

further discussion of our convertible notes.

Management’s Discussion and Analysis of Financial Condition and Results of Operations - continued

ended December 31, 2020 versus December 31, 2019 - continued

Senior Secured Convertible Notes dated Nov 4, 2019 are comprised of a Series A and Series B, each with a $7.0 million face value

principal (“November 2019 Senior Convertible Notes), with the Series A previously funded on November 4, 2019 and the Notes

Series B funded on March 30, 2020 (as further discussed herein below).

During the period from November 2019 to its funding on

March 30, 2020, the Series B incurred interest expense at 3.0% per annum based on its $7.0 million face value principal.

regard, interest expense of approximately $0.1 million was recognized in each of the year ended December 31, 2020 and 2019 (during

the period when the Series B was unfunded from November 4, 2019 to March 29, 2020).

have total estimated federal and state net operating loss (“NOL”) carryforward of approximately $63 million and $40.0

million as of December 31, 2020 and 2019, respectively, which is available to reduce future taxable income, of which approximately

$13.8 million have statutory expiration dates commencing in 2035, and approximately $49.2 million which do not have a statutory

expiration date.

The State and Local NOL carryforwards of approximately $63.0 million have statutory expiration dates commencing

We have total estimated research and development (“R&D”) tax credit carryforward of approximately $0.4

million as of December 31, 2020 which are available to reduce future tax expense and have statutory expiration dates commencing

A valuation allowance reserve equal to the full amount of the deferred tax assets, net of deferred tax liabilities,

has been recognized as a charge to income tax expense as of December 31, 2020 and 2019.

March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was enacted in response to the

pandemic resulting from the outbreak of a novel strain of a coronavirus designated as the “Severe Acute Respiratory Syndrome

Coronavirus 2”

- or “SARS-CoV-2”.

The pandemic resulting from SARS-CoV-2 is commonly referred to by its resulting

illness of “coronavirus disease-2019”

(“COVID-19”), and is referred to herein as the COVID-19 pandemic.

other provisions, the CARES Act increases the limitation on the allowed business interest expense deduction from 30 percent to

50 percent of adjusted taxable income for tax years beginning January 1, 2019 and 2020 and allows businesses to immediately expense

the full cost of Qualified Improvement Property, retroactive to tax years beginning on or after January 1, 2018.

Additionally,

the CARES Act permits net operating loss carryovers (“NOLs”) and carrybacks to offset 100% of taxable income for taxable

years beginning before 2021.

In addition, the CARES Act allows NOLs incurred in 2018, 2019, and 2020 to be carried back to each

of the five preceding taxable years to generate a refund of previously paid income taxes.

While we are currently evaluating the

impact of these CARES Act provisions, it is not expected, at this time, to have a material impact on our consolidated income tax

our consolidated financial statements Note 13, Income Taxes , for additional information with respect to our income

tax provision, deferred tax assets, and deferred tax liabilities.

Management’s Discussion and Analysis of Financial Condition and Results of Operations - continued

and Capital Resources

have financed our operations principally through the public and private issuances of our common stock, preferred stock, common

stock purchase warrants, and debt.

We are subject to all of the risks and uncertainties typically faced by medical device and

diagnostic and medical device companies that devote substantially all of their efforts to the commercialization of their initial

product and services and ongoing R&D and clinical trials.

We expect to continue to experience recurring losses from operations,

and will continue to fund our operations with debt and equity financing transactions.

Notwithstanding, however, together with

the cash on-hand as of December 31, 2020, and the cash proceeds from the issue of shares of common stock of the Company subsequent

to December 31, 2020 in January and February 2021, as discussed herein below, we expect to be able

to fund our future operations for one year from the date of the issue of our consolidated financial statements as included in

our Annual Report on Form 10-K for the year ended December 31, 2020.

the year ended December 31, 2020 and 2019 we issued convertible notes and shares of our common stock, as discussed herein below,

which resulted in approximately $35.9 million and $12.5 million, respectively, of gross proceeds, before placement agent fees

and expenses and additional offering costs incurred by us.

to December 31, 2020, in January and February 2021, we issued shares of our common stock for gross proceeds of approximately $55.0

million before placement agent and underwriter fees and expenses and additional offering costs incurred by us, as discussed herein

Additionally, subsequent to December 31, 2020, we repaid-in-full the remaining outstanding principal balances of each of

our convertible notes, inclusive of the “November 2019 Senior Convertible Notes”

as of January 5, 2021 upon conversion

into shares of our common stock;

and both the “April 2020 Senior Convertible Note”

and the “August 2020 Senior

Convertible Note”

as of March 2, 2021, upon cash repayments, each as discussed herein below.

Secured Convertible Notes dated November 4, 2019 - Series A (November 4, 2019) and Series B (March 30, 2020) (“

2019 Senior Convertible Notes ”)

previously consummated a private placement with an accredited investor in November 2019 of the issue of a Senior Secured Convertible

Note with a $14.0 million aggregate face value principal, referred to herein as the “November 2019 Senior Convertible Notes”.

The November 2019 Senior Convertible Notes were comprised of a Series A and Series B, each with a $7.0 million face value principal,

and each having a $0.7 million lender fee deducted from the cash proceeds when funded, as well as the payment of additional offering

costs, inclusive of a financial advisory fee paid to the placement agent and legal fees.

issued the November 2019 Senior Convertible Note - Series A on November 4, 2019, with a face value principal of $7.0 million,

resulting in cash proceeds of $6.3 million after a $0.7 million lender fee, and we paid additional offering costs of $0.6 million,

inclusive of a financial advisory fee paid to the placement agent and legal fees.

the election of the holder, under its prepayment terms, the November 2019 Senior Convertible Note - Series B was issued on March

30, 2020, with a face value principal of $7.0 million, resulting in cash proceeds of $6.3 million after a $0.7 million of lender

fee, and we additionally paid offering costs of $0.4 million, consisting of a financial advisory fee paid to the placement agent.

November 2019 Senior Convertible Notes accrued interest at 7.875% per annum, upon the respective Series A and Series B being funded

by the investor.

During the period from November 2019 to its funding on March 30, 2020, the November 2019 Senior Convertible Notes

- Series B incurred interest expense at 3.0% per annum based on its $7.0 million face value principal.

the year ended December 31, 2020, with respect to the November 2019 Senior Convertible Notes, approximately $13.0 million of principal

repayments and approximately $0.5 million of interest thereon non-installment payments were settled through the issuance of 8,854,004

shares of our common stock with a fair value of approximately $18.8 million.

As of December 31, 2020, the November 2019 Senior

Convertible Notes remaining unpaid outstanding face value principal was approximately $1.0 million, which was repaid-in-full subsequent

to December 31, 2020, as discussed herein below.

to December 31, 2020, on January 5, 2021, the November 2019 Senior Secured Convertible Note remaining amount due of approximately

$1.0 million was settled with the issuance of 667,668 shares of the Company’s common stock with a fair value of approximately

$1.7 million (with such fair value measured as the respective conversion date quoted closing price of our common stock), with

such final conversion resulting in the November 2019 Senior Secured Convertible Notes being paid-in-full as of January 5, 2021.

Management’s Discussion and Analysis of Financial Condition and Results of Operations - continued

and Capital Resources - continued

Convertible Note dated April 30, 2020 - (“April 2020 Senior Convertible Note”)

April 2020, in a private placement with an accredited investor, we issued a Senior Convertible Note dated April 30, 2020, with

a face value principal of $4.1 million, resulting in cash proceeds of approximately $3.7 million, after a lender fee of approximately

$0.4 million (the “April 2020 Senior Convertible Note”).

The April 2020 Senior Convertible Note has a contractual

maturity date of April 30, 2022, and an annual interest rate of 7.875%, payable in cash on a monthly basis.

As of December 31,

2020, the April 2020 Senior Convertible Note unpaid outstanding face value principal was $4.1 million, which was repaid-in-full

subsequent to December 31, 2020, as discussed herein below.

Secured Convertible Note dated August 6, 2020 (“August 2020 Senior Convertible Note”)

August 2020, in a private placement with an accredited investor, we issued a Senior Secured Convertible Note dated August 6, 2020,

with a face value principal of $7.8 million, resulting in cash proceeds of approximately $7.0 million, after a lender fee of approximately

$0.8 million (the “August 2020 Senior Secured Convertible Note”).

The August 2020 Senior Secured Convertible Note

has a contractual maturity date of August 5, 2022, and an annual interest rate of 7.875%, payable in cash on a monthly basis.

As of December 31, 2020, the August 2020 Senior Secured Convertible Note unpaid outstanding face value principal was $7.75 million,

which was repaid-in-full subsequent to December 31, 2020, as discussed herein below.

Repayments - April 2020 Senior Convertible Note and August 2020 Senior Convertible Note

to December 31, 2020:

on January 30, 2021, we paid in cash a $0.3 million partial principal repayment of the April 2020 Senior

Convertible Note;

and on March 2, 2021, we paid in cash a total of $14.5 million of principal repayments, resulting in both the

April 2020 Senior Convertible Note and the August 2020 Senior Convertible Note being repaid-in-full as of such date.

of Common Stock

the year ended December 31, 2020, we issued a total of 10,647,500 shares of our common stock for gross proceeds of $17.0 million,

with cash proceeds of $15.9 million after the payment of a placement agent fee and expenses of approximately $1.0

million, and we additionally paid offering costs of $0.1 million.

The shares of our common stock were issued in two registered

direct offerings pursuant to a respective Prospectus Supplement dated December 11, 2020 and December 18, 2020, each with

respect to our effective shelf registration statement on Form S-3 (File No.

to December 31, 2020, on January 5, 2021, we issued 6,000,000 shares of our common stock for gross proceeds of $13.4

million, with cash proceeds of $12.4 million, after the payment of $0.9 million of a placement agent fee and expenses, and we

additionally paid offering costs of $0.1 million.

The shares of our common stock were issued in a registered direct offering,

pursuant to a Prospectus Supplement dated January 5, 2021 with respect to our effective shelf registration statement on Form S-3

to December 31, 2020, on February 23, 2021 we issued 9,782,609 shares of our common stock for proceeds of $41.6 million, before

underwriter expenses of $0.1 million, and we additionally incurred estimated offering costs of $0.4 million.

The shares of our

common stock were issued in an underwritten registered offering pursuant to a final Prospectus Supplement dated February 23, 2021

with respect to our effective shelf registration statement on Form S-3 (File No.

333-248709 and File No.

to December 31, 2020, as of March 12, 2021, a total of 773,842 Series Z Warrants were exercised for cash at a $1.60 per share

of our common stock, resulting in the issue of a corresponding number of shares of our common stock.

the previous year ended December 31, 2019, we issued a total of 5,480,000 shares of our common stock for gross proceeds of $5.5

million, with cash proceeds of $5.4 million after the payment of a total of $0.1 million of a placement agent fee and expenses,

and the payment of additional offering costs.

The shares of our common stock were issued in three registered direct

offerings pursuant to a respective Prospectus Supplement dated April 12, 2019, May 8, 2019, and June 25, 2019, each with

respect to our effective shelf registration statement on Form S-3 (File No.

Management’s Discussion and Analysis of Financial Condition and Results of Operations - continued

Accounting Policies and Significant Judgments and Estimates

discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements,

which have been prepared in accordance with generally accepted accounting principles in the United States of America, or U.S.

The preparation of these consolidated financial statements requires us to make estimates and assumptions affecting the reported

amounts of assets, liabilities, and equity, along with the disclosure of contingent assets and liabilities at the date of the

consolidated financial statements and the reported amounts of expenses during the corresponding periods.

In accordance with U.S.

GAAP, we base our estimates on historical experience and on various other assumptions we believe are reasonable under the circumstances.

Actual results may differ from these estimates under different assumptions or conditions.

While our significant accounting policies

are described in more detail in our consolidated financial notes, we believe the following accounting policies to be critical

to the judgments and estimates used in the preparation of our consolidated financial statements.

and Development Expense

and development expenses are recognized as incurred and include the salary and stock-based compensation of employees engaged in

product research and development activities, and the costs related to the Company’s various contract research service providers,

suppliers, engineering studies, supplies, and outsourced testing and consulting fees, as well as depreciation expense and rental

costs for equipment used in research and development activities, and fees incurred for access to certain facilities of contract

research service providers.

Instruments and Fair Value Measurements

Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”)

Topic 820, Fair Value Measurement, (ASC 820) defines fair value as the price which would be received to sell an asset or

paid to transfer a liability in an orderly transaction between market participants at a transaction measurement date.

820 three-tier fair value hierarchy prioritizes the inputs used in the valuation methodologies, as follows:

based on quoted prices for identical assets and liabilities in active markets.

based on observable inputs other than quoted prices included in Level 1, such as quoted

prices for similar assets or liabilities in active markets, quoted prices for identical

or similar assets and liabilities in markets which are not active, or other inputs observable

or can be corroborated by observable market data.

based on unobservable inputs reflecting the Company’s own assumptions, consistent with reasonably available assumptions

made by other market participants.

These valuations require significant judgment.

Company evaluates its financial instruments to determine if those instruments or any embedded components of those instruments

potentially qualify as derivatives required to be separately accounted for in accordance with FASB ASC Topic 815, Derivatives

and Hedging (ASC 815).

The accounting for warrants issued to purchase shares of common stock of the Company is based on the

specific terms of the respective warrant agreement, and are generally classified as equity, but may be classified as a derivative

liability if the warrant agreement provides required or potential full or partial cash settlement.

A warrant classified as a derivative

liability, or a bifurcated embedded conversion or settlement option classified as a derivative liability, is initially measured

at its issue-date fair value, with such fair value subsequently adjusted at each reporting period, with the resulting fair value

adjustment recognized as other income or expense.

If upon the occurrence of an event resulting in the warrant liability or the

embedded derivative liability being subsequently classified as equity, or the exercise of the warrant or the conversion option,

the fair value of the derivative liability will be adjusted on such date-of-occurrence, with such date-of-occurrence fair value

adjustment recognized as other income or expense, and then the derivative liability will be derecognized at such date-of-occurrence

recurring and non-recurring estimated fair value measurements are subjective and are affected by changes in inputs to the valuation

models, including the Company’s common stock price, and certain Level 3 inputs, including, the assumptions regarding the

estimated volatility in the value of the Company’s common stock price;

the Company’s dividend yield;

the likelihood

and timing of future dilutive transactions, as applicable, along with the risk-free rates based on U.S.

Treasury security yields.

Changes in these assumptions can materially affect the estimated fair values.

Management’s Discussion and Analysis of Financial Condition and Results of Operations - continued

Accounting Policies and Significant Judgments and Estimates - continued

Value Option (“FVO”) Election

Senior Secured Convertible Notes and Senior Convertible Note are each a debt host financial instrument containing embedded features

and /or options which would otherwise be required to be bifurcated from the debt-host and recognized as separate derivative liabilities

subject to initial and subsequent periodic estimated fair value measurements under ASC 815.

Notwithstanding, FASB ASC

Topic 825, Financial Instruments , (“ASC 825”) provides for the “fair value option”

(“FVO”)

In this regard, ASC 825-10-15-4 provides for the FVO election (to the extent not otherwise prohibited by

ASC 825-10-15-5) to be afforded to financial instruments, wherein the financial instrument is initially measured at its issue-date

estimated fair value and then subsequently remeasured at estimated fair value on a recurring basis at each reporting period date,

with changes in the estimated fair value recognized as other income (expense) in the consolidated statement of operations.

this regard, as provided for by ASC 825-10-50-30(b), the estimated fair value adjustment is presented in a single line item within

other income (expense) in the consolidated statement of operations.

Further, as required by ASC 825-10-45-5, to the extent a portion

of the fair value adjustment is attributed to a change in the instrument-specific credit risk, such portion would be recognized

as a component of other comprehensive income (“OCI”).

Notwithstanding, there was no such portion of the fair value

adjustment attributed to a change in the instrument-specific credit risk in the years ended December 31, 2020 and 2019.

Management’s Discussion and Analysis of Financial Condition and Results of Operations - continued

Accounting Policies and Significant Judgments and Estimates - continued

awards are made to members of the board of directors of the Company, the Company’s employees and non-employees, under each

of the PAVmed Inc.

2014 Long-Term Incentive Equity Plan and the Lucid Diagnostics Inc.

2018 Long-Term Incentive Equity Plan.

the year ended December 31, 2020, stock-based compensation is recognized in accordance with the provisions of FASB ASC Topic 718,

Compensation - Stock Compensation (“ASC 718”), as amended by FASB Accounting Standard Update (ASU)

2018-07 (“ASU 2018-07”).

The provisions of ASU 2018-07 amended ASC 718 to align the accounting for stock-based awards

granted to nonemployees with the requirements for accounting for stock-based payments to employees;

and to supersede the previous

guidance of FASB ASC Topic 505-50, Equity-Based Payments to Non-Employees (“ASC 505-50”).

The adoption as of

January 1, 2020, of the updated provisions of ASC 718, as amended by ASU 2018-07, had no effect on the Company’s consolidated

financial statements.

the year ended December 31, 2020, with respect to stock-based awards granted to members of the board of directors, employees,

and non-employees, the Company recognizes stock-based compensation in accordance with the provisions of ASC 718, as amended by

ASU 2018-07, wherein the grant-date estimated fair value of the stock-based award is recognized on a straight-line basis over

the requisite service period, which is generally the vesting period of the respective stock-based award, with such straight-line

recognition adjusted, as applicable, so the cumulative expense recognized is at-least equal-to-or-greater-than the estimated fair

value of the vested portion of the respective stock-based award as of the reporting date.

the previous year ended December 31, 2019, the Company recognized stock-based compensation of stock-based awards granted to members

of its board of directors and employees in accordance with ASC 718, as described above;

and with respect to non-employees the

Company recognized stock-based compensation in accordance with previous provisions of ASC 505-50, wherein, the expense of stock-based

awards granted to non-employees was recognized on a vesting date basis by fixing the fair value of vested non-employee stock options

as of their respective vesting date.

The fair value of vested non-employee stock options was not subject-to further remeasurement

at subsequent reporting dates.

The estimated fair value of the unvested non-employee stock options was remeasured to then current

fair value at each subsequent reporting date, until such time when the stock options vest, at which time the fair value is fixed,

as noted above.

The estimated fair value of stock-based awards granted to non-employees was recognized on a straight-line basis

over the requisite service period, which was generally the vesting period of the respective non-employee stock-based award, with

such straight-line recognition adjusted so the cumulative expense recognized was at-least equal-to-or-greater-than the estimated

fair value of the vested portion of the respective stock-based award.

Management’s Discussion and Analysis of Financial Condition and Results of Operations - continued

Accounting Policies and Significant Judgments and Estimates - continued

Company accounts for income taxes using the asset and liability method, as required by FASB ASC Topic 740, Income Taxes ,

(“ASC 740”).

Current tax liabilities or receivables are recognized for estimated income tax payable and/or

refundable for the current year.

Deferred tax assets and deferred tax liabilities are recognized for estimated future tax consequences

attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective

tax basis, along with net operating loss and tax credit carryforwards.

Deferred tax assets and deferred tax liabilities are measured

using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to

be recovered or settled.

Changes in deferred tax assets and deferred tax liabilities are recorded in the provision for income

ASC 740, a “more-likely-than-not”

criterion is applied when assessing the estimated realization of deferred tax assets

through their utilization to reduce future taxable income, or with respect to a deferred tax asset for tax credit carryforward,

to reduce future tax expense.

A valuation allowance is established, when necessary, to reduce deferred tax assets, net of deferred

tax liabilities, when the assessment indicates it is more-likely-than-not, the full or partial amount of the net deferred tax

asset will not be realized.

As a result of the evaluation of the positive and negative evidence bearing upon the estimated realizability

of net deferred tax assets, and based on a history of operating losses, it is more-likely-than-not the deferred tax assets will

not be realized, and therefore a valuation allowance reserve equal to the full amount of the deferred tax assets, net of deferred

tax liabilities, has been recognized as a charge to income tax expense as of December 31, 2020 and 2019.

Company recognizes the benefit of an uncertain tax position it has taken or expects to take on its income tax return if such a

position is more-likely-than-not to be sustained upon examination by the taxing authorities, with the tax benefit recognized being

the largest amount having a greater than 50% likelihood of being realized upon ultimate settlement.

As of December 31, 2020, the

Company does not have any unrecognized tax benefits resulting from uncertain tax positions.

Company’s policy is to record interest and penalties related to income taxes as part of its income tax provision.

were no amounts accrued for penalties or interest as of December 31, 2020 and December 31, 2019 or recognized during the years

ended December 31, 2020 and 2019.

The Company is not aware of any issues under review to potentially result in significant payments,

accruals, or material deviations from its position.

Management’s Discussion and Analysis of Financial Condition and Results of Operations - continued

Accounting Policies and Significant Judgments and Estimates - continued

Accounting Standards Updates

noted herein above, as of January 1, 2020, the Company adopted the amended guidance of ASC 718 with respect to stock-based awards

granted to non-employees, as amended by ASU 2018-07, which aligned the accounting for stock-based payments to nonemployees for

goods and services with the requirements for accounting for stock-based awards granted to employees under ASC 718.In this regard,

ASU 2018-07 provides for stock-based payments to non-employees to be measured at the grant date fair value of the equity instruments

to be provided to the nonemployee when the goods or services have been delivered.

Prior to the ASU 2018-07 amendment, nonemployee

share-based payments were accounted for under the superseded provisions of ASC 505-50.

The adoption of such amended guidance did

not have an effect on the Company’s consolidated financial statements.

of January 1, 2020, the Company adopted ASU 2018-13, Fair Value Measurement (Topic 820):

Disclosure Framework—Changes

to the Disclosure Requirements for Fair Value Measurement, which modifies the disclosure requirements on fair value measurement.

The adoption of ASU 2018-13 did not have an effect on the Company’s consolidated financial statements.

of January 1, 2020, the Company adopted the guidance of ASU 2017-11, issued by the FASB in July 2017, Earnings Per Share (Topic

260), Distinguishing Liabilities from Equity (Topic 480), Derivatives and Hedging (Topic 815) - Part I - Accounting for Certain

Financial Instruments with Down-Round Features, and Part II - Replacement of the Indefinite Deferral for Mandatorily Redeemable

Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception.

Principally, ASU 2017-11 amendments simplify the accounting for certain financial instruments with down-round features.

amendments require companies to disregard the down-round feature when assessing whether the instrument is indexed to its own stock,

for purposes of determining liability or equity classification.

Companies that provide earnings per share data will adjust their

basic earnings per share calculation for the effect of the down-round feature when triggered (i.e., when the exercise price of

the related equity-linked financial instrument is adjusted downward because of the down-round feature) and will also recognize

the effect of the trigger within equity.

Additionally, ASU 2017-11 also addresses “navigational concerns”

FASB ASC related to an indefinite deferral available to private companies with mandatorily redeemable financial instruments and

certain noncontrolling interests, which has resulted in the existence of significant “pending content”

The FASB decided to reclassify the indefinite deferral as a scope exception, which does not have an accounting effect.

of ASU 2017-11 is effective for public business entities, as defined in the ASC Master Glossary, for fiscal years beginning after

December 15, 2018, including interim periods within those fiscal years.

With respect to all other entities, including the Company

under its JOBS Act EGC Accounting Election, as discussed herein below, the guidance of ASU 2017-11 was effective for fiscal years

beginning after December 15, 2019, and interim periods within fiscal years beginning after December 15, 2020.

The adoption of

the ASU 2017-11 guidance as of January 1, 2020 did not have an effect on the Company’s 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) , (“ASU 2020-06”).

simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible

instruments and contracts on an entity’s own equity.

The ASU 2020-06 amendments are effective for fiscal years beginning

after December 15, 2023, and interim periods within those fiscal years.

Early adoption is permitted, but no earlier than fiscal

years beginning after December 15, 2020, including interim periods within those fiscal years.

The Company’s adoption of

the ASU 2020-06 guidance as of January 1, 2021 is not expected to have an effect on the Company’s consolidated financial

December 2019, the FASB issued ASU No.

2019-12, “Income Taxes:

Simplifying the Accounting for Income Taxes”,

(“ASU 2019-12”).

The guidance of ASU 2019-12 removes certain exceptions for recognizing deferred taxes for investments,

performing intra-period allocation, and calculating income taxes in interim periods, and adds revised guidance to reduce complexity

in certain areas, including recognizing deferred taxes for tax goodwill and allocating taxes to members of a consolidated group.

Adoption of the guidance of ASU 2019-12 is required for annual and interim financial statements beginning after December 15, 2020.

The Company’s adoption of the ASU 2019-12 guidance as of January 1, 2021 is not expected to have an effect on the Company’s

consolidated financial statements.

ASC 842, Leases , (ASU No.

2016-02, Leases , February-2016 - “ASU 2016-02”

) which established a

right-of-use (“ROU”) model requiring a lessee to recognize a ROU asset and a lease liability for all leases with terms

greater-than 12 months.

Leases are classified as either finance or operating, with classification affecting the pattern of expense

recognition in the income statement.

The ASC 842 effective date for the Company is December 31, 2022 for its annual financial

statement, and for interim quarterly financial statements commencing March 31, 2023.

Management’s Discussion and Analysis of Financial Condition and Results of Operations - continued

Accounting Policies and Significant Judgments and Estimates - continued

are an “emerging growth company”

or EGC, as defined in the JOBS Act, and are eligible to take advantage of certain

exemptions from various reporting requirements applicable to other public companies who are not an ECG, including, but not limited

to, only two years of audited financial statements in addition to any required unaudited interim financial statements with correspondingly

reduced “Management’s Discussion and Analysis of Financial Condition and Results of Operations”

not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure

obligations regarding executive compensation in our periodic reports and proxy or information statements, and not being required

to adopt certain new and revised accounting standards until those standards would otherwise apply to private companies.

irrevocably elected to avail ourselves of the extended time for the adoption of new or revised accounting standards, and, therefore,

will not be subject to the same new or revised accounting standards as public companies who are not an ECG.

sheet arrangements

do not have any off-balance sheet arrangements.

Quantitative and Qualitative Disclosure About Market Risk

as previously disclosed in our current reports on Form 8-K and quarterly reports on Form 10-Q, we did not sell any unregistered securities

or repurchase any of our securities during the fiscal year ended December 31, 2021.

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

What changed 10-K

Item 5. Market for Registrant’s Common Equity