What changed in this filing

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Item 1. Financial Statements

2022-08-15 compared with 2022-05-25 · 327 added, 217 removed, 353 unchanged (61% of the section changed)

2 unchanged sentences

BALANCE SHEETS

March 31, 2022

December 31, 2021

Assets, net of accumulated depreciation

payable and accrued liabilities

payable, net of discount

stock liability

warrant liability

June 30, 2022

Current Assets

Prepaid expenses

Current Assets

Fixed Assets, net of accumulated depreciation

Current Liabilities

and Contingencies (Notes 5 and 13)

Accounts payable and accrued

Notes payable, net of discount

Contingent stock liability

Total Current Liabilities

Commitments and Contingencies (Notes 5 and

Subsequent Events (Note 15)

Stockholders’

stock, $ 0.0001 par value;

Stockholders’ Equity:

Preferred stock, $ 0.0001

1,000,000 shares authorized;

1 share issued and outstanding

stock, $ 0.0001 par value;

Common stock, $ 0.0001

shares authorized;

5,187,062 shares issued and outstanding 2022 and 2021

stock subscription receivable

paid-in capital

shares issued and outstanding at June 30, 2022 ( 5,187,062

shares issued and outstanding December 31, 2021)

Common stock subscription

Additional paid-in capital

( 12,059,671 )

1 unchanged sentence

Stockholders’ Equity

LIABILITIES AND STOCKHOLDERS’ EQUITY

TOTAL LIABILITIES AND

STOCKHOLDERS’ EQUITY

TECHNOLOGY, INC.

STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

THE THREE MONTHS ENDED MARCH 31

and development

and administrative

STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

THE THREE AND SIX MONTHS ENDED JUNE 30,

Operating expenses:

from operations

and administrative

Total operating expenses

Loss from operations

( 2,787,669 )

income (expense)

adjustment for Contingent Stock and Warrants

( 4,124,953 )

( 1,726,028 )

Other income (expense)

loss and comprehensive loss

Interest income (expense)

( 1,100,507 )

( 1,345,944 )

loss per share, basic and diluted

average shares used to compute net loss per share, basic and diluted

income (expense) adjustment for Contingent Stock and Warrants

Total Other Income (Expense)

Net income (loss) and

comprehensive income (loss)

$ ( 810,647 )

$ ( 1,391,967 )

$ ( 1,725,336 )

Net earnings (loss) per share, basic and diluted

Weighted average shares

used to compute net earnings (loss) per share, basic and diluted

TECHNOLOGY, INC.

STATEMENTS OF STOCKHOLDERS’ EQUITY

THE THREE MONTHS ENDED MARCH 31, 2021

THE SIX MONTHS ENDED JUNE 30, 2021

Stockholders’

1 unchanged sentence

$ ( 6,003,292 )

Net loss for the

three months ended March 31, 2021

Net loss for the three months ended March 31, 2021

Share-based payments

of common stock for equipment order

1 unchanged sentence

$ ( 6,917,981 )

Net loss for the three months

ended June 30, 2021

Share-based payments

of common stock from subscriptions

of common stock

for equipment order

– June 30, 2021

$ ( 7,728,628 )

TECHNOLOGY, INC.

STATEMENT OF STOCKHOLDER’S EQUITY

THE THREE MONTH ENDED MARCH 31, 2022

Preferred Stock

THE THREE AND SIX MONTHS ENDED JUNE 30, 2022

Stock Subscription

Stockholder’s

-December 31, 2021

Balance -December

$ ( 10,667,704 )

1 unchanged sentence

$ ( 10,667,704 )

Net loss for the

three months ended March 31, 2022

Net loss for the three months ended March 31, 2022

( 1,869,721 )

compensation charges

Share-based compensation charges

of common stock subscriptions

1 unchanged sentence

$ ( 12,537,425 )

Ending Balance

Net income for the three months

ended June 30,

Net income (loss)

Shares issued in Initial Public

Issuance of shares for contingent

stock liability

Fractional share adjustment

Share-based compensation charges

issued for services

– June 30, 2022

$ ( 12,059,671 )

TECHNOLOGY, INC.

STATEMENTS OF CASH FLOWS

THE THREE MONTHS ENDED MARCH 31

FLOWS FROM OPERATING ACTIVITIES:

THE SIX MONTHS ENDED JUNE 30

CASH FLOWS FROM OPERATING ACTIVITIES:

$ ( 1,391,967 )

$ ( 1,725,336 )

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

and amortization

of debt discount

adjustment for Contingent Stock and Contingent Warrants

in operating assets

expenses and other

assets – deposits

Adjustments to reconcile net loss to net cash

used in operating activities:

Depreciation and amortization

Stock-based compensation

Common stock issued for

Accretion of debt discount

FMV adjustment for Contingent

FMV adjustment for Warrants

( 3,897,930 )

IPO Issuance costs relating

Changes in operating assets

Prepaid expenses and other

payable and accrued liabilities

cash used in operating activities

Net cash used in operating

( 3,093,105 )

FLOWS FROM INVESTING ACTIVITIES:

– Manufacturing Equipment

assets – Escrow

cash used in investing activities

FLOWS FROM FINANCING ACTIVITIES:

from common stock subscriptions and subscriptions receivable

cash provided by financing activities

INCREASE (DECREASE) IN CASH

( 1,412,332 )

— BEGINNING OF PERIOD

— END OF PERIOD

DISCLOSURE OF CASH FLOW INFORMATION:

paid for interest

paid for taxes

investing and financing activity:

stock options and common stock for fixed assets acquired

stock options issued as consideration for acquisition

CASH FLOWS FROM INVESTING ACTIVITIES:

Acquisition of machinery

and equipment

( 1,473,250 )

assets – escrow and other

( 2,350,000 )

Net cash used in investing

( 2,813,355 )

( 1,558,512 )

CASH FLOWS FROM FINANCING ACTIVITIES:

Net Proceeds from Initial

Public Offering Units

Repayment of note payable

( 2,000,000 )

Proceeds from subscriptions

and subscriptions receivable

Net cash provided by

financing activities

NET INCREASE (DECREASE) IN CASH

( 1,310,844 )

CASH — BEGINNING OF PERIOD

CASH — END OF PERIOD

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

Cash paid for interest

Non-cash investing

and financing activity:

FMV for Common stock issued for contingent

Vested stock options and common stock for fixed

assets acquired

Vested stock options

issued as consideration for acquisition

TECHNOLOGY, INC.

TO THE CONDENSED FINANCIAL STATEMENTS

THE THREE MONTHS ENDED MARCH 31, 2022 AND 2021

THE SIX MONTHS ENDED JUNE 30, 2022 AND 2021

Description of Business

3 unchanged sentences

Company’s fiscal year ends on December 31.

April 14, 2022, the Company completed its Initial Public Offering and received net proceeds of $ 14.2 million.

(See Note 14(b)).

April 13, 2022, the Company Initial Public Offering was deemed effective with trading commencing on April 14, 2022.

The Company received

net proceeds of $ 14.2 million on April 19, 2022.

Summary of Significant Accounting Policies

16 unchanged sentences

consist of material, labor, and manufacturing overhead.

Net realizable value is the estimated selling price in the ordinary course

of business, less reasonably predictable costs of completion, disposal, and transportation.

A reserve is established for any excess

or obsolete inventories or they may be written off.

At March 31, 2022 and December 31, 2021, inventory is comprised of raw

TECHNOLOGY, INC.

TO THE CONDENSED FINANCIAL STATEMENTS

THE THREE MONTHS ENDED MARCH 31, 2022 AND 2021

Summary of Significant Accounting Policies (continued)

Net realizable value is the estimated selling price in the ordinary course of

business, less reasonably predictable costs of completion, disposal, and transportation.

A reserve is established for any excess or obsolete

inventories or they may be written off.

At June 30, 2022 and December 31, 2021, inventory is comprised of raw materials.

Value Measurements

7 unchanged sentences

used to measure fair value.

Company’s outstanding warrants are fair valued with the trading price which could cause fluctuations in operating results at the

reporting periods.

TECHNOLOGY, INC.

TO THE CONDENSED FINANCIAL STATEMENTS

THE SIX MONTHS ENDED JUNE 30, 2022 AND 2021

Summary of Significant Accounting Policies (continued)

1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

25 unchanged sentences

The expected life for Molds is based number of parts that will be produced based on the expected mold capability.

TECHNOLOGY, INC.

TO THE CONDENSED FINANCIAL STATEMENTS

THE THREE MONTHS ENDED MARCH 31, 2022 AND 2021

of Long-Lived Assets

5 unchanged sentences

measured by the amount by which the carrying amount of the assets exceeds the projected discounted future net cash flows arising from

were no impairment losses recognized during the three months ended March 31, 2022 and 2021.

were no impairment losses recognized during the three and six months ended June 30, 2022 and 2021.

TECHNOLOGY, INC.

TO THE CONDENSED FINANCIAL STATEMENTS

THE SIX MONTHS ENDED JUNE 30, 2022 AND 2021

Summary of Significant Accounting Policies (continued)

and Purchased Identified Intangible Assets

39 unchanged sentences

that the carrying amount of such assets exceeds their estimated fair value.

TECHNOLOGY, INC.

TO THE CONDENSED FINANCIAL STATEMENTS

THE THREE MONTHS ENDED MARCH 31, 2022 AND 2021

Compensation Expense

8 unchanged sentences

at the fair value of the consideration received or the fair value of the equity instruments issued, whichever can be more reliably measured.

Company accounts for common stock warrants as either equity-classified or liability-classified instruments based on an assessment of

the specific terms of the warrants and applicable authoritative guidance in Financial Accounting Standards Board (“FASB”)

Accounting Standards Codification (“ASC 480”), Distinguishing Liabilities from Equity (“ASC 480”) and ASC 815,

Derivatives and Hedging (“ASC 815”).

The assessment considers whether the warrants are freestanding financial instruments

pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and meet all of the requirements for equity classification

under ASC 815, including whether the warrants are indexed to the Company’s own stock and whether the holders of the warrants could

potentially require net cash settlement in a circumstance outside of the Company’s control, among other conditions for equity classification.

This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent

quarterly period end date while the warrants are outstanding.

their issuance date and as of June 30, 2022, the warrants (see Note 7) were accounted for as liabilities as these

instruments did not meet all of the requirements for equity classification under ASC 815-40 based on the terms of the aforementioned

The resulting warrant liabilities are re-measured at each balance sheet date until their exercise or expiration, and any change

in fair value is recognized in the Company’s statement of operations and comprehensive loss.

TECHNOLOGY, INC.

TO THE CONDENSED FINANCIAL STATEMENTS

THE SIX MONTHS ENDED JUNE 30, 2022 AND 2021

Summary of Significant Accounting Policies (continued)

and Diluted Loss Per Share

Company computes net loss per share in accordance with ASC 260, Earnings per Share.

ASC 260 requires presentation of both basic and diluted

earnings per share (EPS) on the face of the statement of operations and comprehensive loss.

Basic EPS is computed by dividing net income

(loss) available to common stockholders (numerator) by the weighted average number of shares outstanding (denominator) during the year.

Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible

preferred stock using the if-converted method.

In computing diluted EPS, the average stock price for the period is used in determining

the number of shares assumed to be purchased from the exercise of stock options or warrants.

Diluted EPS excludes all dilutive potential

shares if their effect is anti-dilutive.

ASC 260 requires presentation of both basic and

diluted earnings per share (EPS) on the face of the statement of operations and comprehensive loss.

Basic EPS is computed by

dividing net income (loss) available to common stockholders (numerator) by the weighted average number of shares outstanding

(denominator) during the year.

Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using

the treasury stock method and convertible preferred stock using the if-converted method.

In computing diluted EPS, the average stock

price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or

Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive.

As at June 30, 2022, there were 10,452,773

stock options and warrants that could potentially dilute basic EPS in the future that were not included in the computation of

diluted EPS because to do so would have been antidilutive for the periods presented.

Company must make certain estimates and judgments in determining income tax expense for financial statement purposes.

21 unchanged sentences

Such amounts are recognized as an expense as the related goods are delivered or the services are performed.

TECHNOLOGY, INC.

TO THE CONDENSED FINANCIAL STATEMENTS

THE THREE MONTHD ENDED MARCH 31, 2022 AND 2021

Summary of Significant Accounting Policies (continued)

Contingencies

11 unchanged sentences

Legal costs incurred in connection with loss contingencies are expensed as incurred.

TECHNOLOGY, INC.

TO THE CONDENSED FINANCIAL STATEMENTS

THE SIX MONTHS ENDED JUNE 30, 2022 AND 2021

Recent Accounting Pronouncements

21 unchanged sentences

Company does not expect the adoption of any accounting pronouncements to have a material impact on the financial statements.

asset, net, as of June 30, 2022 and December 31, 2021, are summarized as follows:

of Machinery and Equipment

Machinery and equipment

Fixed asset, gross

accumulated depreciation

Fixed asset, net

expense of fixed assets for the six months ended June 30, 2022 and 2021 was $ 156,100 and $ 3,500 , respectively.

the six months ended June 30, 2022, the Company recorded $ 63,512 in fixed asset costs relating to the estimated fair market value for

options granted in 2021 for the acquired machinery.

As of June 30, 2022, the Company has $ 100,000 in remaining payments for machinery

purchased, which is included in accounts payable and accrued expenses.

TECHNOLOGY, INC.

TO THE CONDENSED FINANCIAL STATEMENTS

THE THREE MONTHS ENDED MARCH 31, 2022 AND 2021

asset, net, as of March 31, 2022 and December 31, 2021, are summarized as follows:

Schedule of Machinery and Equipment

and equipment

accumulated depreciation

expense of fixed assets for the three months ended March 31, 2022 and 2021 was $ 73,050 and $ 0 , respectively.

the three months ended March 31 2022, the Company recorded $ 63,512 in fixed asset costs relating to the fair market value for options

granted in 2021 for the acquired machinery.

During the three months ended March 31, 2021, the Company recorded $ 100,000 in fixed asset

costs for common stock issued for the acquired machinery.

As of March 31, 2022 the Company has $ 300,000 in remaining payments for machinery

purchased, which is included in accounts payable and accrued expenses, which will be paid through May 31, 2022.

assets as of March 31, 2022 and December 31, 2021 are summarized as follows:

THE SIX MONTHS ENDED JUNE 30, 2022 AND 2021

assets as of June 30, 2022 and December 31, 2021 are summarized as follows:

of Other Assets

(see Note 13)

June 2020, the Company entered into a Share Purchase Agreement (“Agreement”) and amendments to the Agreement through April

Acquisition (see below)

June 2020, the Company entered into a Share Purchase Agreement (“Agreement”) and amendments to the Agreement through June

30, 2022, collectively, the Agreements, to purchase either the stock or certain assets of a manufacturing facility for $ 2.5 M in cash,

plus additional consideration of 28,571 shares of common stock with a fair market value of $ 7.00 and 35,714 stock options with an exercise

price of $ 7.00 .

At March 31, 2022, the fair market value of the common stock of $ 200,000 and the vested options of $ 163,602 is included

in Other Assets, The Agreements provided the Company various periods for due diligence and post due diligence, requirements for escrow

payments of $ 150,000 and a closing date is expected by June 30, 2022 (“Closing Date”).

of March 31, 2022, the Company has paid $ 150,000 in escrow payments, which is recorded in Other Assets.

plus additional consideration of 28,571 shares of common stock with an estimated fair market value of $ 7.00 and 35,714 stock options

with an exercise price of $ 7.00 .

At March 31, 2022, the fair market value of the common stock of $ 200,000 and the vested options of $ 163,602

is included in Other Assets, The Agreements provided the Company various periods for due diligence and post due diligence, requirements

for escrow payments of $ 150,000 and a closing date was expected by June 30, 2022 (“Closing Date”).

Due to delayed approvals

and registrations by the Hungarian government, the Company agreed to increase the escrow balance an additional $ 2,350,000 .

of June 30, 2022, the Company has paid $ 2,500,000 in escrow payments, which is recorded in Other Assets.

The escrow payments may be forfeited

7 unchanged sentences

Date, the Escrow balances will be applied to the final payment due the Sellers.

(See Note 15)

the Closing Date, the Agreements provide the Company with the exclusive use of the facility in exchange for payment of the facility’s

2 unchanged sentences

comprised of the seller’s workforce costs, materials and other recurring monthly operating cost.

TECHNOLOGY, INC.

TO THE CONDENSED FIN ANCIAL STATEMENTS

THE THREE MONTHS ENDEDMARCH 31, 2022 AND 2021

Other Assets (continued)

payment of the Operating Costs does not provide the Company with rights associated with a rent agreement.

1 unchanged sentence

operating costs was concluded not to be in substance a lease agreement, and therefore no right-of-use asset or lease liability were recognized.

During the three months ended March 31, 2022 and 2021, the Company had remitted $ 275,000 and $ 150,000 , respectively for the aforementioned

Operating Costs.

These costs were included in research and development expense in the statement of operations and comprehensive loss

as the activities at the facility in 2022 and 2021 were related to design and testing of the Company’s products.

During the three and six months ended June 30, 2022, the Company had remitted $ 337,000 (2021 - $ 226,000 ) and $ 771,000 (2021 - $ 691,000 ),

respectively for the aforementioned Operating Costs.

These costs were included in research and development expense in the statement of

operations and comprehensive loss as the activities at the facility in 2022 and 2021 were related to design and testing of the Company’s

TECHNOLOGY, INC.

TO THE CONDENSED FINANCIAL STATEMENTS

THE SIX MONTHS ENDED JUNE 30, 2022 AND 2021

Note Purchase Agreement

24 unchanged sentences

the Company consummates an initial public offering (“IPO”) (such period referred to as the “Subsequent Offering Period”).

the Company has a Consummated Offering, which is not an IPO, each Purchaser can elect to use the price per share of that Consummated

Offering to determine the quantity of Contingent Stock and Contingent Warrants it would be issued from the Company.

However, each Purchaser

also has an option to elect not to use that price per share, but instead utilize the price per share from a future IPO to determine the

quantity of Contingent Stock and Contingent Warrants it would be issued from the Company.

In the event the Company has an offering that

is not an IPO after December 14, 2021, and any Purchaser does not elect to utilize that per share price to determine the quantity of

Contingent Stock or Contingent Warrants it would receive (with the plan to utilize a future IPO’s per share price), and there ultimately

is no IPO in the future, the Company would not issue any Contingent Stock or Contingent Warrants to that Purchaser.

In the event that

the Company never has any Consummated Offering after December 14, 2021 (whether it be an IPO or other type of offering), the Contingent

Stock and Contingent Warrants would never be issued to the Purchasers.

TECHNOLOGY, INC.

TO THE CONDENSED FINANCIAL STATEMENTS

THE THREE MONTHS ENDED MARCH 31, 2022 AND 2021

THE SIX MONTHS ENDED JUNE 30, 2022 AND 2021

Note Purchase Agreement (continued)

15 unchanged sentences

were allocated to the Contingent Stock and Contingent Warrants, which was $ 124,460 , was expensed during the year ended December 31, 2021.

The debt issuance costs allocated to the Note was recorded as a debt discount.

Contingent Stock and Contingent Warrant liabilities were measured at FMV on the date of issuance (based on the December 31, 2021 Black-Scholes

valuation model).

In estimating the fair value of the Contingent Stock and Warrants on March 31, 2022, the Company estimated the probability

of a Consummated Offering of 95%, a probability of the Note held to maturity of 4% and a dissolution factor of 1% .

The Contingent Stock

was measured using a 12% discount for lack of marketability using the Finnerty model and the Contingent Warrants were measured using

the Black-Scholes option-pricing model using the following assumptions:

Of Contingent Stock And Contingent Warrant Assumptions

Free interest rate

The debt issuance costs allocated to the Notes were recorded as a debt discount.

Contingent Stock and Contingent Warrant liabilities were measured at FMV on the date of issuance (based on the Black-Scholes valuation

inception, the Notes were recorded at the net amount of approximately $ 665,000 , after adjusting for debt discounts of approximately $ 1,335,000

3 unchanged sentences

interest rate.

For three months ended months ended March 31, 2022, the Company recorded interest expense of $ 39,111 and accreted interest

of $ 206,417 .

value of the Contingent Stock and Contingent Warrants is required to be re-measured at FMV at each reporting date (based on the Black-Scholes

valuation model) with recognition of the changes in fair value to other income or expense in the consolidated statement of operations

in accordance with ASC 480, Debt and Equity.

For the three months ended March 31, 2022, the Company recorded a $ 287,000 fair market fair

(FMV) charge to reflect the increase in the Contingent Stock and Contingent Warrant liabilities.

to March 31, 2022, the Company completed its IPO (See Note 14(a)) and repaid the $ 2,000,000 Notes with net proceeds and settled the Contingent

Stock and Warrant liability.

For six months ended June 30, 2022, the Company recorded interest expense of $ 39,111 (2021 - $ nil ) and accreted interest

of $ 1,299,895 (2021 - $ nil ) and repaid the $ 2,000,000 Notes with proceeds from the IPO that closed on April 19, 2022.

Contingent Stock and Contingent Warrant liabilities were measured at FMV on the date of issuance using the Black-Scholes valuation model.

The value of the Contingent Stock and Contingent Warrants is required to be re-measured at FMV at each reporting date, using either the

Black-Scholes valuation model or other valuation method, with recognition of the changes in fair value to other income or expense in

the statement of operations in accordance with ASC 480, Debt and Equity.

On April 19, 2022, the Company issued 235,295 shares

of Common Stock to settle the Contingent Stock liability, re-measured the liability at its estimated FMV based on the stock’s trading

price and reclassified $ 496,000 to Common Stock Par Value and Additional Paid in Capital.

connection with the closing of the IPO, 235,295 Contingent Warrants (“Note Warrants”) with an exercise price of $ 4.25 .

The terms of the Note Warrants continue to require classification as a liability under ASC 815 with recognition of the changes

in fair value to other income or expense in the statement of operations in accordance with ASC 480 Debt and Equity.

During the six months

ended June 30, 2022, the Company recorded a FMV income adjustment of $ 520,000 to reduce the Warrant liability from $ 585,000 at December

31, 2021 to $ 65,000 at June 30,2022.

(See Notes 7 and 9)

TECHNOLOGY, INC.

TO THE CONDENSED FINANCIAL STATEMENTS

THE THREE MONTHS ENDED MARCH 31, 2022 AND 2021

THE SIX MONTHS ENDED JUNE 30, 2022 AND 2021

Stockholders’ Equity

3 unchanged sentences

March 22, 2022, the Company completed a plan and agreement of merger with Sharps Technology, Inc., a Nevada corporation (“Sharps

Pursuant to the merger agreement,

(i) the Company merged with and into Sharps Nevada, (ii) each 3.5 shares of common stock of the Company were converted into one share

of common stock of Sharps Nevada and (iii) the articles of incorporation and bylaws of Sharps Nevada, became the articles of incorporation

and bylaws of the surviving corporation.

Company’s authorized common stock and preferred stock increased from 50,000,000

to 100,000,000

shares, respectively.

Pursuant to the merger agreement, (i) the Company merged with and into Sharps Nevada, (ii) each 3.5 shares of common

stock of the Company were converted into one share of common stock of Sharps Nevada and (iii) the articles of incorporation and bylaws

of Sharps Nevada, became the articles of incorporation and bylaws of the surviving corporation .

The Company’s authorized common

stock and preferred stock increased from 50,000,000 to 100,000,000 and 10,000 to 1,000,000 shares, respectively.

The par value of preferred

stock decreased from $ 0.001

Note 14(b) regarding Initial Public Offering.

the three months ended March 31, 2021, the Company completed stock subscriptions through a private placement for 187,143 shares of common

stock at $ 7.00 per share.

The Company received cash proceeds of $ 1,310,000 .

stock decreased from $ 0.001 to $ 0.0001 per share.

April 13, 2022 , the Company’s initial public offering (“IPO”) was declared effective by the SEC pursuant

to which the Company issued and sold an aggregate of 3,750,000 units (“Units”), each consisting of one share of common stock

and two warrants, to purchase one share of common stock for each whole warrant, with an initial exercise price of $ 4.25 per share and

a term of five years .

In addition, the Company granted Aegis Capital Corp., as underwriter a 45-day over-allotment option to purchase

up to 15% of the number of shares included in the units sold in the offering, and/or additional warrants equal to 15% of the number of

Warrants included in the units sold in the offering, in each case solely to cover over-allotments, which the Aegis Capital Corp.

exercised with respect to 1,125,000 warrants on April 19, 2022.

Company’s common stock and warrants began trading on the Nasdaq Capital Market or Nasdaq on April 14, 2022.

The net proceeds from

the IPO, prior to payments of certain listing and professional fees were approximately $ 14.2 million.

The net proceeds, after reflecting

par value, has been recorded in Additional Paid in Capital and with respect to the Warrants as a liability under ASC 815.

the six months ended June 30, 2022, the Company issued 35,000 shares of common stock at the trading stock price in connection with services

provided to the Company and recorded a charge of $ 60,551 , In addition, the Company issued 235,295 common shares relating to the Note

Purchase agreement.

connection with the IPO in April 2022, the Company issued 7,500,000 warrants (Trading Warrants) as a component of the Units and 1,125,000

warrants to the underwriter (Overallotment Warrants), as noted in Common Stock above.

The Trading and Overallotment Warrants were

recorded at the FMV, being the trading price of the warrants, on the IPO effective date and the Warrants are classified as a Liability

based on ASC 815.

The Warrant liability requires remeasurement at each reporting period.

At the IPO, the liability was $ 5,778,750

and at June 30, 2022 the liability was $ 2,401,338 .

During the three months ended June 30, 2022, the Company recorded a FMV income

adjustment of $ 3,378,412 .

Company has issued 235,295 Warrants (“Note Warrants”) to the Purchasers of the Notes on April 19, 2022.

The Note Warrants have an exercise price of $ 4.25 and a term of five years.

underwriter received 187,500 warrants in connection with the IPO for a nominal cost of $ 11,250 .

The Warrants have an exercise price

of $ 5.32 and are exercisable after October 9, 2022.

The FMV at the date of issuance was $ 228,655 computed using the Black Sholes

valuation method with the following assumptions:

a) volatility of 93.47 %, five -year term, risk free interest rate 2.77 % and 0 % dividend

The FMV was classified as additional issuance costs.

TECHNOLOGY, INC.

TO THE CONDENSED FINANCIAL STATEMENTS

THE SIX MONTHS ENDED JUNE 30, 2022 AND 2021

Preferred Stock

1 unchanged sentence

and Director.

The Series A Preferred Stock entitles the holder to vote 50.1 % on any matters related to the election of directors.

Series A Preferred Stock has no right to dividends, or distributions in the event of a liquidation and is not convertible into common

The Series A Preferred Stock entitles the holder to vote on any matters related to the election of directors and was reduced

from 50.1 % at December 31, 2021 to 25 %, effective with the IPO.

The Series A Preferred Stock has no right to dividends, or distributions

in the event of a liquidation and is not convertible into common stock.

In the event the Company is sold during the two-year period following

completion of IPO at a price per share of more than 500% of the initial offering price per Unit in the IPO, the Series A Preferred Stock,

as in effect upon completion of the IPO, will entitle the holder to 10 % of the total purchase price.

Warrant Liability

Warrants were accounted for as liabilities in accordance with ASC 815-40 and are presented as a Warrant liability in the accompanying

balance sheet.

The warrant liabilities are measured at fair value at inception and on a recurring basis, with changes in fair value presented

within the statement of operations and comprehensive income (loss).

(See Note 6 and 7)

Warrant liability at June 30, 2022 was as follows:

of Warrant Liability

Note Warrants (b)

and Overallotment Warrants (a)

following table presents the changes in the Warrant liability of the Level 1 warrants issued on April 14, 2022, the effective date of

the IPO measured at fair value:

of Changes in the Warrant Liability

FMV of Note Warrants

FMV of Trading and Overallotment Warrants

Change in fair value of warrant liability

( 3,470,577 )

Fair Value at June 30.

TECHNOLOGY, INC.

TO THE CONDENSED FINANCIAL STATEMENTS

THE THREE MONTHS ENDED MARCH 31, 2022 AND 2021

THE SIX MONTHS ENDED JUNE 30, 2022 AND 2021

Stock Options

1 unchanged sentence

of Stock Options Granted and Outstanding

at Beginning of year

at end of period

As of March 31, 2022 there was $ 932,530 of unrecognized stock-based compensation related to unvested stock options, which is expected

to be recognized over a weighted-average period of 34 months .

following table summarizes information about options outstanding at March 31, 2022:

Schedule of Options Outstanding

Contractual Life

the three months ended March 31, 2022 and 2021, the Company recognized stock-based compensation expense of $ 223,947 , of which $ 213,635

and $ 10,312 was recorded in general and administrative and research and development expenses, respectively and $ 189,237 , of which $ 137,673

Outstanding at beginning of period

Options granted

Outstanding at end of period

Exercisable at end of period

the six months ended June 30 2022, the Company issued 267,500 stock options.

As of June 30, 2022 there was $ 781,386 of unrecognized stock-based

compensation related to unvested stock options, which is expected to be recognized over a weighted-average period of 29 months.

following table summarizes information about options outstanding at June 30, 2022:

of Options Outstanding

the three months ended June 30, 2022 and 2021, the Company recognized stock-based compensation expense of $ 365,606 , of which $ 325,736

and $ 39,870 was recorded in general and administrative and research and development expenses, respectively and $ 104,766 in 2021, of which

$ 94,454 and $ 10,312 was recorded in general and administrative and research and development expenses, respectively.

Further, for the three months

ended March 31, 2022, the Company recorded stock-based charges relating to consideration for purchase of machinery of $ 63,512 (see Note

4) and $ 40,901 relating to an Acquisition (see Note 5).

the end of each interim reporting period, the Company estimates its effective tax rate expected to be applied for the full year.

estimate is used to determine the income tax provision or benefit on a year-to-date basis and may change in subsequent interim periods.

Accordingly, the Company’s effective tax rate for the three months ended March 31, 2022 was 0 %, compared to the effective tax rate

of 0 % for the three months ended March 31, 2021.

The Company’s effective tax rates for both periods were affected primarily by

a full valuation allowance on domestic net deferred tax assets.

the six months ended June 30, 2022 and 2021, the Company recognized stock-based compensation expense of $ 589,553 , of which $ 539,371 and

$ 50,182 was recorded in general and administrative and research and development expenses, respectively and $ 293,983 in 2021, of which

$ 232,107 and $ 61,876 was recorded in general and administrative and research and development expenses, respectively.

Further, for the

six months ended June 30, 2022, the Company recorded stock-based charges relating to consideration for purchase of machinery of $ 63,512

(See Note 4) and $ 40,901 relating to an Acquisition.

TECHNOLOGY, INC.

TO THE CONDENSED FINANCIAL STATEMENTS

THE THREE MONTHS ENDED MARCH 31, 2022 AND 2021

THE SIX MONTHS ENDED JUNE 30, 2022 AND 2021

the end of each interim reporting period, the Company estimates its effective tax rate expected to be applied for the full year.

estimate is used to determine the income tax provision or benefit on a year-to-date basis and may change in subsequent interim periods.

Accordingly, the Company’s effective tax rate for the three and six months ended June 30, 2022 was 0 %, compared to the effective

tax rate of 0 % for the three and six months ended June 30, 2021.

The Company’s effective tax rates for both periods were affected

primarily by a full valuation allowance on domestic net deferred tax assets.

Related Party Transactions and Balances

of March 31, 2022 and December 31, 2021, accounts payable and accrued liabilities include $ 104,313 and $ 59,375 , respectively, payable

of June 30, 2022 and December 31, 2021, accounts payable and accrued liabilities include $ 294,419 and $ 59,375 , respectively, payable

to officers and directors and the Company.

The amounts are unsecured, non-interest bearing and are due on demand.

(See Note 15).

Fair Value Measurements

3 unchanged sentences

are measured at amortized cost and approximates fair value due to their short duration and market rate for similar instruments, respectively.

of March 31, 2022, the following financial assets and liabilities were measured at fair value on a recurring basis presented on the Company’s

of June 30, 2022, the following financial assets and liabilities were measured at fair value on a recurring basis presented on the Company’s

balance sheet:

1 unchanged sentence

Value Measurements Using

stock liability

warrant liability

assets measured at fair value

Total liabilities measured at fair value

Commitments and Contingencies

10 unchanged sentences

The royalty agreement was assumed by the Company in December 2017.

TECHNOLOGY, INC.

TO THE CONDENSED FINANCIAL STATEMENTS

THE SIX MONTHS ENDED JUNE 30, 2022 AND 2021

Commitments and Contingencies (continued)

September 2018, the Royalty Agreement was amended to reduce the royalty to 2 % and further provided for a single payment of $ 500,000 to

2 unchanged sentences

Agreement was further amended to change the payment date to on or before May 31, 2021 or during the term of the amended Royalty Agreement

should the Company be acquired or a controlling interest

The Company has not made the aforementioned payment or incur any change in control as such the 2 % royalty remains in place.

TECHNOLOGY, INC.

TO THE CONDENSED FINANCIAL STATEMENTS

THE THREE MONTHS ENDED MARCH 31, 2022 AND 2021

Commitments and Contingencies (continued)

Company has an outstanding order to purchase molds of $ 120,000 of which progress payments $ 80,000 have been made and recorded in Other

should the Company be acquired or a controlling interest be acquired.

The Company has not made the aforementioned payment or incur any

change in control as such the 2 % royalty remains in place.

October 2, 2021, the Company entered into an engagement agreement with Aegis Capital Corp.

9 unchanged sentences

The agreement has a termination date of twelve months from the date thereof or upon completion of the

proposed offering.

proposed offering which occurred on April 14, 2022.

Subsequent Events

Public Offering:

April 13, 2022, the Company completed its initial public offering (“IPO”) which was declared effective by the Security

and Exchange Commission (SEC), and the Company’s common stock and warrants began trading on the Nasdaq Capital Market or Nasdaq

on April 14, 2022 and which closed on April 19, 2022.

As a result, the unaudited consolidated financial statements as of March 31,

2022 do not reflect the impact of the IPO.

The net proceeds from the IPO, prior to payments of certain listing and professional fees

were approximately $ 14.2 million.

In connection with the closing of the IPO, the Company used net proceeds to repay the Note Payable

of $ 2 million.

connection with the repayment of the Note Payable, the Company issued to the Note holders 235,294 shares of common stock and 235,294

to the IPO, the Company awarded 267,500 options to officers, directors and employees under the 2022 Equity Incentive Plan at the

market price on dated awarded.

Company closed on the Acquisition for the shares of Safegard Medical (see Note 5) on July 8, 2022 and released $ 2,450,000 in escrow funds.

The remaining $ 50,000 in escrow will be held until finalization of any transfer taxes due.

to June 30, 2022, the Company cancelled the consulting agreement with Alan Blackman, Co- Chairman and Chief Operating Officer and entered into an Employment

Agreement which provides for annual salary of $ 256,000 and provisions compensation adjustments, expense and tax differential reimbursements,

benefits and bonuses.

At June 30, 2022, the Company approved and accrued a $ 250,000 bonus to Mr.

Blackman for services provided in 2022.

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

What changed 10-Q

Item 1. Financial Statements