What changed in this filing

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Item 1A. Risk Factors

2024-03-28 compared with 2023-03-31 · 54 added, 50 removed, 486 unchanged (18% of the section changed)

11 unchanged sentences

Our consolidated financial statements for the fiscal year ended December 31, 2023 have been prepared assuming we will continue as a going concern and do not include any adjustments that might result from uncertainty about our ability to continue as a going concern.

We will require substantial additional funding to further develop our product candidates, including to complete Phase 3 testing of levosimendan in PH-HFpEF or to initiate or complete the imatinib Phase 3 trial.

We will require substantial additional funding to further develop our product candidates, including to complete the LEVEL trial, which includes an open label extension phase, to complete a subsequent Phase 3 trial of TNX-103, and to initiate or complete the imatinib Phase 3 trial.

Failure to obtain this necessary capital when needed on acceptable terms, or at all, or execute on alternative strategic paths, could force us to delay, limit, reduce or terminate our clinical trials, product development efforts and business operations.

Developing biopharmaceutical products, including conducting preclinical studies and clinical trials and establishing manufacturing and sales and marketing capabilities, is expensive.

We expect our research and development expenses to increase in connection with our ongoing activities.

We expect our research and development expenses to continue to increase in connection with our ongoing activities.

In addition, our expenses could increase beyond expectations if applicable regulatory authorities, including the FDA, require that we perform studies additional to those we currently anticipate, in which case the timing of any potential product approval may be delayed.

As of December 31, 2023, we had $9.8 million of cash and cash equivalents on hand.

We will need substantial additional capital in order to develop our product candidates, including to complete a Phase 3 trial, and to complete the regulatory approval process and commercialization of levosimendan, imatinib, or any future product candidates.

We will need substantial additional capital in order to develop our product candidates, including to complete the LEVEL trial and its associated open label extension, a Phase 3 trial of TNX-103, and to complete the regulatory approval process and commercialization of levosimendan, and, potentially, imatinib, or any future product candidates.

As a result, we continue to evaluate strategic alternatives, including pursuing additional public or private equity offerings, debt financings or corporate collaboration and licensing arrangements.

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We continue to evaluate strategic paths to provide the resources necessary to complete our product development and maximize stockholder value.

Potential strategic paths may include multiple capital raises, a sale of our Company, merger, one or more license agreements, a co-development agreement, a combination of these, or other strategic transactions.

Potential strategic paths may include additional capital raises, a sale of our Company, merger, one or more license agreements, a co-development agreement, a combination of these, or other strategic transactions.

There can be no assurance, however, that our evaluation will result in transactions or other alternatives, even when deemed necessary.

There is no set timetable for our strategic process and we do not intend to provide updates unless or until the Board of Directors approves a specific action or otherwise determines that disclosure is appropriate or necessary.

We have shifted the anticipated launch of the imatinib Phase 3 trial in PAH beyond 2023, and the initiation of that trial and continued development of our product candidates, including completion of a Phase 3 trial of levosimendan in PH-HFpEF, depend on the outcome of our ongoing strategic process.

We have suspended plans to launch the imatinib Phase 3 trial in PAH, and the initiation of that trial and continued development of our product candidates, including completion of the LEVEL Study, our Phase 3 trial of levosimendan in PH-HFpEF, depend on the outcome of our ongoing strategic process.

There can be no assurance any transaction will result from the Company’s ongoing evaluation of strategic paths.

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There can be no guarantee that the process of evaluating alternative strategic paths will result in our Company entering into or completing potential transactions within the anticipated timing or at all.

In the event we do not successfully complete a strategic transaction, should this be deemed necessary, our Board of Directors may decide to pursue a dissolution and liquidation of our Company.

In the event we do not successfully complete strategic transactions, should this be deemed necessary, our Board of Directors may decide to pursue a dissolution and liquidation of our Company.

In such an event, the amount of cash available for distribution to our stockholders will depend heavily on the timing of such liquidation as well as the amount of cash that will need to be reserved for commitments and contingent liabilities.

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In order to maintain this listing, we must satisfy minimum financial and other requirements.

On March 29, 2023, we received a notification letter from the Nasdaq Stock Market LLC (“Nasdaq”) indicating that we were not in compliance with Nasdaq Listing Rule 5550(a)(2) because the minimum bid price of our common stock on the Nasdaq Capital Market closed below $1.00 per share for 30 consecutive business days.

In accordance with Nasdaq Listing Rule 5810(c)(3)(A), the Company has a compliance period of 180 calendar days, or until September 25, 2023, to regain compliance with the Bid Price Rule.

If at any time before September 25, 2023, the bid price of the Company's common stock closes at $1.00 per share or more for a minimum of ten consecutive business days, Nasdaq will provide the Company with a written confirmation of compliance with the Bid Price Rule.

While we intend to engage in efforts to regain compliance, and thus maintain our listing, there can be no assurance that we will be successful or continue to meet all applicable Nasdaq Capital Market requirements in the future.

On March 29, 2023, we received a notification letter from the Nasdaq Stock Market LLC (“Nasdaq”) indicating that we were not in compliance with Nasdaq Listing Rule 5550(a)(2) (the “Bid Price Rule”) because the minimum bid price of our common stock on the Nasdaq Capital Market closed below $1.00 per share for 30 consecutive business days.

In accordance with Nasdaq Listing Rule 5810(c)(3)(A), the Company had a compliance period of 180 calendar days, or until September 25, 2023, to regain compliance with the Bid Price Rule.

This timeline was extended by Nasdaq until March 25, 2024, and following the Reverse Stock Split, the Company regained compliance.

On January 18, 2024, Nasdaq provided the Company with a written confirmation of compliance with the Bid Price Rule.

On January 11, 2024, we received a notification letter from Nasdaq indicating that we were not in compliance with Nasdaq Listing Rule 5550(a)(4) (the “Public Float Rule”), which requires the Company to have a minimum of 500,000 publicly held shares.

On February 22, 2024, Nasdaq provided the Company with a written confirmation of compliance with the Public Float Rule.

While we intend to engage in efforts to maintain compliance, and thus maintain our listing, there can be no assurance that we will be successful or continue to meet all applicable Nasdaq Capital Market requirements in the future.

If our common stock were to be removed from listing with the Nasdaq Capital Market, it may be subject to the so-called “penny stock” rules.

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our ability to attract and retain personnel, including our executive team, advisors and members of our Board of Directors;

volatility and uncertainty in the global economy and financial markets in light of the possibility of pandemics, global financial and geopolitical uncertainties, including the Russian invasion of and war against the country of Ukraine.

volatility and uncertainty in the global economy and financial markets in light of the possibility of pandemics, global financial and geopolitical uncertainties, including in the Middle East and the Russian invasion of and war against the country of Ukraine.

Due to the various factors mentioned above, and others, the results of any prior quarterly or annual periods should not be relied upon as indications of our future operating performance.

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There could be continuing or new effects of COVID-19 or similar disrupting illnesses to the processes, timelines, resourcing, and other aspects of operations at FDA or other health authorities, which could result in delays of reviews and approvals, including with respect to our product candidates.

Additionally, the continued spread of COVID-19 or similar disrupting illnesses could adversely affect our future clinical trial operations in the United States and elsewhere, including our ability to recruit and retain patients and principal investigators and site staff who, as healthcare providers, may have heightened exposure to respiratory illnesses if an outbreak occurs in their geography.

Additionally, the continued spread of COVID-19 or similar disrupting illnesses could adversely affect our future clinical trial operations in the United States, Canada, and elsewhere, including our ability to recruit, retain, and rely on the active participation of patients and principal investigators and site staff who, as healthcare providers, may have heightened exposure to respiratory illnesses if an outbreak occurs in their geography.

The spread of COVID-19, or another infectious disease, could also negatively affect the operations at our third-party manufacturers, which could result in delays or disruptions in the supply of our product candidates.

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We have historically operated with a limited number of employees.

As of the date of this report, we have five full-time employees and one part-time employee.

As of December 31, 2023, we had five full-time employees and one part-time employee.

Therefore, institutional knowledge is concentrated within a small number of employees.

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We currently have no approved drug products for sale.

The research, testing, manufacturing, labeling, approval, selling, marketing, and distribution of drug products are subject to extensive regulation by the FDA and other regulatory authorities in the United States and other countries, with regulations differing from country to country.

The research, testing, manufacturing, labeling, approval, selling, marketing, and distribution of drug products are extensively regulated by the FDA and other regulatory authorities in the United States and other countries, with regulations differing from country to country.

We are not permitted to market our product candidates in the United States until we receive approval of a New Drug Application (“NDA”) from the FDA for each product candidate.

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Even if we believe the preclinical or clinical data for our product candidates are promising, such data may not be sufficient to support approval by the FDA and other regulatory authorities.

Additionally, the FDA may also require us to conduct additional preclinical studies or clinical trials for our product candidates either prior to or post-approval, or it may object to elements of our clinical development program.

We are required to conduct additional clinical trials, which are expensive and time consuming, and the outcome of the trials is uncertain.

We expect to commit a substantial portion of our financial and business resources in the short-term to completing a Phase 3 trial of levosimendan and advancing this product to regulatory approval for use in PH-HFpEF, and potentially other indications.

We may in future commit resources to clinical trials for our other product candidates, including imatinib.

Additionally, the FDA may require us to conduct additional preclinical studies or clinical trials for our product candidates either prior to or post-approval, or it may object to elements of our clinical development program.

We are required to conduct additional clinical trials, including the LEVEL trial for oral levosimendan, which are expensive and time consuming, and the outcome of the clinical trials is uncertain.

We expect to commit a substantial portion of our financial and business resources in the short-term to completing the LEVEL trial, a Phase 3 trial of levosimendan, and advancing this product through a subsequent Phase 3 trial and on to regulatory approval for use in PH-HFpEF, and potentially other indications.

We may in the future commit resources to clinical trials for our other product candidates, including imatinib.

All of these clinical trials and testing will be expensive and time consuming and the timing of the regulatory review process is uncertain.

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From time to time, we may publish interim, top-line, or preliminary results from our clinical trials.

Interim results from clinical trials that we may complete are subject to the risk that one or more of the clinical outcomes may materially change as patient enrollment and treatment extends, and more patient experience is observed.

Interim or top-line results from clinical trials that we may complete are subject to the risk that one or more of the clinical outcome measurements may materially change as patient enrollment and treatment extends and more patient experience is observed.

Preliminary or top-line results also remain subject to audit and verification procedures that may result in the final data being materially different from the preliminary data we previously published.

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Any collaboration we enter with third parties to develop and commercialize any future product candidates may place the development of our product candidates outside our control, may require us to relinquish important rights or may otherwise be on terms unfavorable to us.

Pending the outcome of our strategic process, we may enter into collaborations with third parties to develop and commercialize future product candidates.

We may enter into collaborations with third parties to develop and commercialize future product candidates.

Our dependence on future partners for development and commercialization of our product candidates would subject us to a number of risks, including the following:

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Delays in the enrollment and completion of clinical testing could result in increased costs to us and delay or limit our ability to obtain regulatory approval for our product candidates.

Delays in the enrollment and completion of clinical testing could significantly affect our ability to gain FDA approval of current product candidates and could significantly increase our future product development costs.

The completion of clinical trials requires us to identify and maintain a sufficient number of trial sites, many of which may already be engaged in other clinical trial programs for the same indication as our product candidates or may be required to withdraw from our clinical trial as a result of changing standards of care or may become ineligible to participate in clinical studies.

Delays in the commencement, enrollment and completion of clinical testing could significantly affect our ability to gain FDA approval of current product candidates, to gain this approval in the timeline planned, and could significantly increase our future product development costs.

The completion of clinical trials requires us to identify and maintain a sufficient number of trial sites, many of which might already be engaged in other clinical trial programs for the same indication as our product candidates, might be required to withdraw from our clinical trial as a result of changing standards of care, might suffer from staff shortages at the institutional or clinic level that impact their ability to enroll and treat patients under our protocols, or might become ineligible to participate in clinical studies.

The enrollment and completion of clinical trials can be delayed for a variety of other reasons, including delays related to:

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In addition, many of the factors that cause, or lead to, a delay in the commencement or completion of clinical trials may also ultimately lead to the denial of regulatory approval of a product candidate.

Even if we are able to ultimately commercialize our product candidates, other therapies for the same or similar indications may have been introduced to the market and established a competitive advantage.

Even if we are ultimately able to commercialize our product candidates, other therapies for the same or similar indications may have been introduced to the market and established a competitive advantage.

Risks Relating to Our Industry

Intense competition might render our cardiovascular and pulmonary product candidates noncompetitive or obsolete.

Competition in the pharmaceutical industry in general and in our therapeutic areas in particular is intense and characterized by extensive research efforts and rapid technological progress.

Competition in the pharmaceutical industry in general and in our therapeutic areas is intense and characterized by extensive research efforts and rapid technological progress.

Technological developments by competitors, regulatory approval for marketing competitive products, including potential generic or over-the-counter products, or superior marketing resources possessed by competitors could adversely affect the commercial potential of our cardiovascular and pulmonary disease product candidates and could have a material adverse effect on our future revenue and results of operations.

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Many of our current competitors have significant financial, marketing and personnel resources and development capabilities.

For example, many large, well-capitalized companies already offer cardiovascular and pulmonary products and services in the United States and Europe that target the indications for which our product candidates are being developed.

Currently, as an example, twelve vasodilators are marketed in the U.S.

for use in patients with PAH, and sales teams from Janssen, Pfizer, Bayer, United Therapeutics, and other large companies with marketing and sales capabilities represent these products in the specialized care centers where the disease is treated.

While there are no products currently marketed to treat PH-HFpEF, some products are under development to treat this prevalent disease.

Our activities are and will continue to be subject to extensive government regulation, which is expensive and time-consuming, and we will not be able to sell our products without regulatory approval.

Our development, marketing, and distribution of levosimendan and, potentially in the future, imatinib, are, and will continue to be, subject to extensive regulation, monitoring and approval by the FDA and other regulatory agencies.

There are significant risks at each stage of the regulatory scheme.

There are significant risks at each stage of regulation.

Product approval stage

During the product approval stage, we attempt to prove the safety and efficacy of our product candidate for its indicated uses.

During the product approval stage, we study and attempt to prove the safety and efficacy of our product candidate for its indicated uses.

There are numerous problems that could arise during this stage, including:

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if a prolonged government shutdown occurs, it could significantly impact the ability of the FDA to timely review and process our regulatory submissions;

even after extensive testing and clinical trials, and receiving agreements and reassurances from FDA, EMA, and others, as to their future position on a dataset or result to be generated from a trial the design of which they have weighed in on, there is no assurance that regulatory approval will ever be obtained for any of our products.

even after extensive testing and clinical trials, and receiving agreements and reassurances from the FDA, EMA, and others, as to their future position on a dataset or result to be generated from a trial the design of which they have weighed in on, there is no assurance that regulatory approval will ever be obtained for any of our products.

Post-commercialization stage

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Orphan Drug Designation neither shortens the development time or regulatory review time of a drug nor gives the drug any advantage in the regulatory review or approval process.

Pending the outcome of our ongoing strategic process, even after products are commercialized, we would expect to spend considerable time and money complying with federal and state laws and regulations governing their sale, and, if we are unable to fully comply with such laws and regulations, we could face substantial penalties.

Even after products are commercialized, we would expect to spend considerable time and money complying with federal and state laws and regulations governing their sale, and, if we are unable to fully comply with such laws and regulations, we could face substantial penalties.

Health care providers, physicians and others would play a primary role in the recommendation and prescription of our clinical products.

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Applicable federal and state health care laws and regulations are expected to include, but not be limited to, the following:

the federal anti-kickback statute is a criminal statute that makes it a felony for individuals or entities knowingly and willfully to offer or pay, or to solicit or receive, direct or indirect remuneration, in order to induce the purchase, order, lease, or recommending of items or services, or the referral of patients for services, that are reimbursed under a federal health care program, including Medicare and Medicaid;

the federal anti-kickback statute is a criminal statute that makes it a felony for individuals or entities knowingly and willfully to offer or pay, or to solicit or receive, direct or indirect remuneration, in order to induce the purchase, order, lease, or recommendation of items or services, or the referral of patients for services, that are reimbursed under a federal health care program, including Medicare and Medicaid;

the federal False Claims Act imposes liability on any person who knowingly submits, or causes another person or entity to submit, a false claim for payment of government funds, with penalties that include three times the government’s damages plus civil penalties for each false claim;

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We are subject to uncertainty relating to healthcare reform measures and reimbursement policies that, if not favorable to our products, could hinder or prevent our products’ commercial success, if any of our product candidates are approved.

Pending the outcome of our ongoing strategic process, our ability to successfully commercialize our products will depend in part on the extent to which governmental authorities, such as Medicare, private health insurers and other organizations establish what we believe to be appropriate coverage and reimbursement for our approved products.

Our ability to successfully commercialize our products will depend in part on the extent to which governmental authorities, such as Medicare, private health insurers and other organizations establish what we believe to be appropriate coverage and reimbursement for our approved products.

The unavailability or inadequacy of third-party payer coverage and reimbursement could negatively affect the market acceptance of our product candidates and the future revenues we may expect to receive from any approved products.

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There is no uniform policy requirement for coverage and reimbursement for drug products among third-party payers in the United States;

therefore, coverage and reimbursement for drug products can differ significantly from payer to payer.

therefore, coverage and reimbursement for drug products can differ significantly by payer.

The coverage determination process is often a time-consuming and costly process that will require us to provide scientific and clinical support for the use of our products to each payer separately, with no assurance that coverage and adequate payment will be applied consistently or obtained.

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Governments outside the United States tend to impose strict price controls and reimbursement approval policies, which may adversely affect our prospects for generating revenue outside the United States.

We have distribution rights in the United States and Canada for levosimendan and worldwide distribution rights to our formulation of imatinib, and in some countries, particularly European Union countries and Canada, the pricing of prescription pharmaceuticals is subject to governmental control.

We have worldwide distribution rights for levosimendan and our formulation of imatinib, and in some countries, particularly European Union countries and Canada, the pricing of prescription pharmaceuticals is subject to governmental control.

In these countries, pricing negotiations with governmental authorities can take considerable time after the receipt of marketing approval for a product.

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Further, if we achieve regulatory approval of any product, we must successfully negotiate product pricing for such product in individual countries.

As a result, the pricing of our products, if approved, in different countries may vary widely, thus creating the potential for third-party trade in our products in an attempt to exploit price differences between countries.

As a result, if our products are approved, the pricing of our products in different countries may vary widely, thus creating the potential for third-party trade in our products in an attempt to exploit price differences between countries.

This third-party trade of our products could undermine our sales in markets with higher prices.

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There can be no assurance that product liability insurance will be available in the future or be available on reasonable terms.

Our business and operations would suffer in the event of computer system failures, cyber-attacks or deficiencies in our cyber-security.

Our business and operations would suffer in the event of computer system failures, cyber-attacks or deficiencies in our cybersecurity.

Despite the implementation of security measures, our internal computer systems, and those of third parties on which we rely, are vulnerable to damage from computer viruses, malware, natural disasters, terrorism, war, telecommunication and electrical failures, cyber-attacks or cyber-intrusions over the Internet, attachments to emails, persons inside our organization, or persons with access to systems inside our organization.

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Our disclosure controls and procedures address cybersecurity and include elements intended to ensure that there is an analysis of potential disclosure obligations arising from security breaches.

We also maintain compliance programs to address the potential applicability of restrictions against trading while in possession of material, nonpublic information generally and in connection with a cyber-security breach.

However, a breakdown in existing controls and procedures around our cyber-security environment may prevent us from detecting, reporting or responding to cyber incidents in a timely manner and could have a material adverse effect on our financial position and value of our stock.

However, a breakdown in existing controls and procedures around our cybersecurity environment may prevent us from detecting, reporting or responding to cyber-incidents in a timely manner and could have a material adverse effect on our financial position and value of our stock.

For more information, see Item 1C.

Cybersecurity.

Risks Related to Our Dependence on Third Parties

We have historically, and pending the outcome of our ongoing strategic process, we will continue to rely significantly on third parties to conduct our nonclinical testing and clinical studies and other aspects of our development programs.

We have historically and we will continue to rely significantly on third parties to conduct our nonclinical testing and clinical studies and other aspects of our development programs.

If those third parties do not satisfactorily perform their contractual obligations or meet anticipated deadlines, the development of our product candidates could be adversely affected.

We do not currently employ personnel or possess the facilities necessary to conduct many of the activities associated with our development programs.

We have historically, and pending the outcome of our strategic process, we will continue to engage consultants, advisors, CROs and others to assist in the design and conduct of nonclinical and clinical studies of our product candidates, with interpretation of the results of those studies and with regulatory activities and expect to continue to outsource all or a significant amount of such activities.

We have historically and we will continue to engage consultants, advisors, CROs and others to assist in the design and conduct of nonclinical and clinical studies of our product candidates, with interpretation of the results of those studies and with regulatory activities and expect to continue to outsource all or a significant amount of such activities.

As a result, many important aspects of our development programs are and will continue to be outside our direct control and our third-party service providers may not perform their activities as required or expected, including the maintenance of Good Laboratory Practices (“GLP”) or Good Clinical Practices (“GCP”) compliance, which are ultimately our responsibility to ensure.

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Pursuant to the terms of our license for levosimendan, Orion is at present our sole manufacturing source for TNX-103;

should they opt not to provide us the product, our license agreement provides for 24 months’ notice to Tenax of same, to allow an alternative manufacturer to be brought onboard.

should they opt not to provide us the product, our license agreement provides for 24 months’ notice to the Company of same, to allow an alternative manufacturer to be brought onboard.

We might engage other third-party suppliers and CMOs for the supply and manufacture of TNX-102, or other formulations we might develop.

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If we cannot obtain an alternate manufacturer in a timely manner, we would experience a significant interruption in supply of levosimendan, which could negatively affect our financial condition, results of operations and cash flows.

To potentially manufacture imatinib in the future, we have contracted with various third-party suppliers and clinical manufacturing organizations (“CMOs”) making us highly dependent on these CMOs.

To potentially manufacture imatinib in the future, we have contracted with various third-party suppliers and CMOs making us highly dependent on these CMOs.

We do not at present have alternative CMOs planned or contracted to back up our primary vendors of clinical trial material or, if approved, commercial supply material.

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We are pursuing a multi-faceted IP strategy for levosimendan that includes filing patent applications in the U.S.

and Canada that, if granted, could protect various uses and formulations of levosimendan In January 2022, the USPTO granted Tenax Therapeutics a patent protecting claims for different uses of various cyclodextrin-based subcutaneous formulations of levosimendan, including a claim for its use in the treatment of PH-HFpEF patients.

In addition, we received in March 2023 another patent protecting the use of levosimendan in treatment of PH-HFpEF.

and Canada that, if granted, could protect various uses and formulations of levosimendan In January 2022, the USPTO granted us a patent protecting claims for different uses of various cyclodextrin-based subcutaneous formulations of levosimendan, including a claim for its use in the treatment of PH-HFpEF patients.

In addition, we received in March 2023 another patent protecting the use of levosimendan in the treatment of PH-HFpEF.

Two subsequent patents expanded these protections on the use of levosimendan in the treatment of PH-HFpEF.

Our strategy to maximize market exclusivity for imatinib relies on two forms of exclusivity.

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If another party has filed a U.S.

patent application on inventions similar to ours, we may have to participate in an interference proceeding declared by the U.S.

Patent and Trademark Office (the “USPTO”) to determine priority of invention in the United States.

patent application on inventions similar to ours, we may have to participate in an interference proceeding declared by the USPTO to determine priority of invention in the United States.

The costs of these proceedings could be substantial, and it is possible that such efforts would be unsuccessful if, unbeknownst to us, the other party had independently arrived at the same or similar invention prior to our own invention, resulting in a loss of our U.S.

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status of our search and selection of future management and leadership;

general economic and market conditions, including as a result of epidemics or other disruptive events broadly affecting society, and as a result of geopolitical uncertainties, including the Russian invasion of and war against the country of Ukraine.

general economic and market conditions, including as a result of epidemics or other disruptive events broadly affecting society, and as a result of geopolitical uncertainties, including in the Middle East and the Russian invasion of and war against the country of Ukraine.

Some companies that have had volatile market prices for their securities have had securities class action lawsuits filed against them.

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Anti-takeover provisions in our corporate charter documents and under Delaware law could make an acquisition of us more difficult, which could discourage takeover attempts and lead to management entrenchment, and the market price of our common stock may be lower as a result.

Certain provisions in our Certificate of Incorporation, as amended (the “Charter”), and our Third Amended and Restated Bylaws (the “Bylaws”) may make it difficult for a third party to acquire, or attempt to acquire, control of the Company, even if a change in control was considered favorable by the stockholders.

Certain provisions in our Certificate of Incorporation, as amended (the “Charter”), and our Fourth Amended and Restated Bylaws (the “Bylaws”), may make it difficult for a third party to acquire, or attempt to acquire, control of the Company, even if a change in control was considered favorable by the stockholders.

For example, our Board of Directors has the authority to issue up to 10,000,000 shares of preferred stock.

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This provision would not apply to suits brought to enforce a duty or liability created by the Securities and Exchange Act of 1934, as amended (the “Exchange Act”) or the Securities Act of 1933, as amended (the “Securities Act”), or any other claim for which federal courts have exclusive jurisdiction.

This exclusive forum provision may limit a stockholder’s ability to bring a claim in a judicial forum of its choosing for disputes with us or our directors, officers or other employees, which may discourage lawsuits against us and our directors, officers and other employees.

If a court were to find the exclusive forum provision in our Bylaws to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving the dispute in other jurisdictions, which could harm our results of operations.

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Any such limitations on the ability to use our NOLs and other tax assets could adversely impact our business, financial condition and operating results in the event that we attain profitability.

ITEM 1B—UNRESOLVED STAFF COMMENTS

Smaller reporting companies are not required to provide the information required by this Item.

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

What changed 10-K

Item 1A. Risk Factors