What changed in this filing

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Item 7. Management’s Discussion and Analysis

2026-03-25 compared with 2025-03-18 · 85 added, 94 removed, 154 unchanged (54% of the section changed)

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In September 2022, we announced a significant reduction in force, suspension of preclinical activities and halting of all research and development, and that we were exploring strategic alternatives to maximize stockholder value.

In February 2024, we received an upfront payment of $500,000 from a licensing agreement for patents related to one of our historical drug candidates, and received a small, one-time payment and an entitlement to only modest royalties on future sales of the licensed technology that we do not believe will be material.

In the second quarter, we recognized other income of $637,000 from the sale of our samples related to the licensed product.

In the third quarter, we sold our historical biotechnology intellectual property and other assets (including the licensing agreement described above) pursuant to the purchase agreement and recognized other income of $1,500,000.

We continue to engage in a broader exploration of strategic alternatives.

This effort involves exploring growth through transactions with potential partners that see opportunity in joining an existing, publicly-traded organization.

Following the purchase agreement, any value we may generate from our historical biotechnology intellectual property and other assets will be primarily through royalties and license fees that we may receive in the future under the purchase agreement.

In 2024, we entered into a licensing agreement for patents related to one of our historical drug candidates, and received a small, one-time payment and an entitlement to only modest royalties on future sales of the licensed technology that was not material.

We then sold some of its samples related to the licensed product.

Also in 2024, we entered into an Asset Purchase Agreement with Flashpoint Therapeutics, Inc.

to sell our historical biotechnology intellectual property and other assets to the purchaser.

Any value we may generate from our historical biotechnology intellectual property and other assets will be primarily through royalties and license fees that we may receive in the future under the Asset Purchase Agreement.

However, whether we receive any royalties or licenses fees, and the amounts and timing thereof, are uncertain and out of our control.

While the foregoing efforts are continuing, with respect to our historical assets, we do not expect they will generate significant value for stockholders.

Therefore, we are engaging in a broader exploration of strategic alternatives.

We continue to engage in a broader exploration of strategic alternatives, including but not limited to private company acquisitions, raising additional capital, strategic partnerships, some combination of these, and other arrangements that are in management’s view worth exploring.

We obtained significant financing late in 2024 in order to continue operations and our exploration of strategic alternatives and consummate any transactions that we may identify.

On January 19, 2025, we entered into a Share Purchase Agreement with GPCR pursuant to which we acquired from GPCR all of the issued and outstanding equity securities of GPCR USA.

In connection with the closing of the Share Purchase Agreement, the Company and GPCR entered into a License and Collaboration Agreement to further develop and commercialize GPCR’s technologies related to certain intellectual property and patents.

This License and Collaboration Agreement requires us to make milestone payments to GPCR upon the achievement of specific milestone events relating to clinical trials, marketing authorizations, and net sales, as well as for us to pay a recurring royalty payments, as set forth in the agreement.

GPCR USA completed its Phase 2 clinical trial in January 2026 that focused on blood cancer patients, particularly those eligible for hematopoietic stem cell transplantation, commonly referred to as bone marrow transplant.

Its current clinical trial involves the combined administration of GPC-100 (a small molecule antagonist with a high binding affinity to a chemokine receptor) and propranolol (a beta-blocker drug that affects the heart and circulation) for mobilization of stem cells in Multiple Myeloma patients.

In accordance with the terms of the License and Collaboration Agreement, we intend to make a milestone payment of $1.0 million to GPCR in the form of shares of our common stock in the second quarter of 2026.

On March 26, 2025, the Company formed KC Creation Co., Ltd., a wholly-owned South Korean subsidiary.

It was established based on potential future growth strategies, such as a collaboration with GPCR USA and Korean bio-platform companies, response to sustainability trends by development of infrastructure based on eco-friendly renewable energy, and diversification of business and utilization of global growth potential of Korean entertainment content.

However, Management decided to sell this subsidiary on November 24, 2025.

Operating, financing, and cash flow considerations

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The transactions under the SangSang Purchase Agreement closed on December 24, 2024.

On December 10, 2024, the Company entered into a common stock purchase agreement with MIRTO Co.

(“MIRTO”), pursuant to which the Company agreed to issue and sell to MIRTO 87,808 shares of its Common Stock, for an aggregate purchase price of approximately $0.41 million, at a purchase price per share of $4.61, which closed on December 24, 2024.

On February 14, 2025, the Company entered into a Common Stock Purchase Agreement with Shin Chang Partners and RMS0718 Co., Ltd., pursuant to which the Company agreed to issue and sell to each of the purchasers 145,454 shares at a purchase price of $5.50 per share.

The Company received aggregate gross process of approximately $1.6 million.

As of December 31, 2025, our cash and cash equivalents cash were approximately $3.7 million.

Our current liquidity may not be sufficient to fund operations for the next 12 months.

As a result, there is substantial doubt about

our ability to continue as a going concern.

As a result, there is substantial doubt about our ability to continue as a going concern.

Additional financing will be needed to fund our ongoing operations and exploration of strategic alternatives and pursue any alternatives that we identify.

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Recent Developments

Change of Control

Significant Stockholder

As discussed above, effective as of November 12, 2024, we entered into the Initial Common Stock Purchase Agreement with HiTron, pursuant to which we agreed to issue and sell to HiTron 433,333 shares of Common Stock for an aggregate purchase price of $1.3 million, at a purchase price per share of $3.00.

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As of March 17, 2026, HiTron beneficially owns 25% of the outstanding shares of Common Stock based on information available to the Company.

Nasdaq Listing Requirements Deficiency Notices

As previously disclosed, we have received numerous deficiency notes with respect to various Nasdaq listing requirements in the past year.

These related to:

• Compliance with Nasdaq’s minimum bid price rule due to our stock trading below $1.00 for a sustained period of time.

We effected a one-for-thirty reverse stock split on June 29, 2022 in order to attempt to raise the stock price.

On September 13, 2023, we received a delinquency notification that the closing bid price of our stock traded below $1.00 for the previous 30 consecutive business days.

We effected a one-for-five reverse stock split on August 27, 2024 in order to attempt to raise the stock price.

On September 13, 2024, we received a letter received from Nasdaq noting it met the closing bid price requirement.

• Compliance with Nasdaq’s rule requiring stockholders’ equity of at least $2,500,000 based on our balance sheet as of December 31, 2024.

We were not in compliance with this requirement based on its September 30, 2024 balance sheet.

We believes it is in compliance with this requirement based on its December 31, 2024 balance sheet and expects to be in compliance going forward.

• Compliance with Nasdaq’s corporate governance requirements with respect to board and committee composition .

We has received numerous deficiency notifications with respect to these requirements in the past year.

Although we are currently in compliance, there can be no assurance it will remain in compliance.

• Compliance with Nasdaq’s requirement to hold an annual meeting.

On January 11, 2024, Nasdaq notified us that it did not comply with listing requirements by not holding an annual meeting in 2023.

We held its combined 2023 and 2024 annual meeting on June 28, 2024.

• On April 17, 2024, we received a delinquency notification as it had not filed its Annual Report Form 10-K for the year ended December 31, 2023.

The extended deadline for compliance was established by Nasdaq at May 20, 2024, the same deadline for our Form 10-Q for the quarter ended September 30, 2023.

The Annual Report Form 10-K for the fiscal year ended December 31, 2023 was filed on June 6, 2024.

• Although we filed its Form 10-Q for the quarter ended September 30, 2023 prior to the extended deadline of May 20, 2024, on May 21, 2024, we received a delisting determination from the Nasdaq staff as a result of not filing its Annual Report Form 10-K by the May 20, 2024 deadline and failure to timely file its Form 10-Q for the quarter ended March 31, 2024 (which was subsequently filed on June 17, 2024).

The staff’s delisting determination also noted the failure to hold its 2023 annual meeting as another basis of the delisting determination.

• On May 28, 2024, we requested an appeal of the delisting determination to Nasdaq’s Hearings Panel (“Panel”), and the hearing took place on July 9, 2024.

On July 31, 2024, we received formal notice that the Panel determined to continue our listing subject to us evidencing compliance with all applicable criteria for continued listing on The Nasdaq Capital Market by September 16, 2024.

We received an additional extension to November 14, 2024 to satisfy the terms of the Panel’s decision and to ensure our continued listing on Nasdaq.

• As we did not meet Nasdaq’s listing requirements as of September 30, 2024, we has requested another extension by the Panel to demonstrate compliance and another extension was granted.

We thereafter presented its plan to regain compliance with the Equity Requirement to the Panel, subsequent to which the Panel ultimately granted us extensions through December 17, 2024 to do so.

• On December 20, 2024, we received a letter from Nasdaq confirming that, as of December 17, 2024, we meet all requirements for continued listing on Nasdaq as required by the Panel’s decision dated November 20, 2024.

In accordance with the Panel’s decision, on December 17, 2024, we made public disclosure under cover of a Form 8-K, describing the transactions undertaken by us to achieve compliance with Listing Rule 5550(b)(1) and stated affirmatively that as of that date, it believes it has stockholders’ equity above the $2.5 million requirement and provided a pro-forma balance sheet as of December 17, 2024.

Pursuant to Listing Rule 5815(d)(4)(B), we will be subject to a Mandatory Panel Monitor for a period of one year from the date of Nasdaq’s letter.

If, within that one-year monitoring period, the Nasdaq Listing Qualifications staff (the “Staff”) finds us again out of compliance with the $2.5 million Equity Rule that was the subject of the exception, notwithstanding Rule 5810(c)(2), we will not be permitted to provide the Staff with a plan of compliance with respect to that deficiency and the Staff will not be permitted to grant additional time for us to regain compliance with respect to that deficiency, nor will we be afforded an applicable cure or compliance period pursuant to Rule 5810(c)(3).

Instead, the Staff will issue a Delist Determination Letter and we will have an opportunity to request a new hearing with the initial Panel or a newly convened Panel if the initial Panel is unavailable.

We will have the opportunity to respond/present to the Panel as provided by Listing Rule 5815(d)(4)(C).

Our securities may be at that time delisted from Nasdaq.

Even if we regains compliance with Nasdaq’s listing requirements and addresses the outstanding deficiency notices to Nasdaq’s satisfaction, there can be no assurance that we will remain in compliance with Nasdaq’s requirements and will not be delisted.

Nasdaq Listing Requirements Compliance

As previously disclosed, we have received numerous deficiency notices with respect to various Nasdaq listing requirements in the past year.

Most recently, on May 21, 2025, the Company received a delinquency notification from Nasdaq that it had not filed its Form 10-Q for the period ended March 31, 2025.

The Company became compliant upon filing its Form 10-Q for the period ended March 31, 2025 on June 27, 2025.

Even though we regained compliance with Nasdaq’s listing requirements, there can be no assurance that we will remain in compliance with Nasdaq’s requirements and will not be delisted in the future.

Reverse Stock Split

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There are items within our financial statements that require estimation but are not deemed critical, as defined above.

Management has discussed the development and selection of these critical accounting estimates with the Audit Committee of our Board of Directors.

Changes in estimates used in these and other items could have a material impact on our financial statements.

This includes estimates where the nature of the estimate is material due to the levels of subjectivity and judgment necessary to account for highly uncertain matters or the susceptibility of such matters to change, and the impact of the estimate on financial condition or operating performance is material.

Business Combinations

We follow the acquisition method of accounting to record identifiable assets acquired and liabilities assumed in connection with acquired businesses at their estimated fair value as of the date of acquisition.

Identifiable intangible assets from business combinations are recognized at their estimated fair values as of the date of acquisition and consist of in-process research and development (“IPR&D”).

Determination of the estimated fair value of identifiable intangible assets requires judgment.

The fair value of intangible assets is estimated using the Multi-Period Excess Earnings Method for the acquired IPR&D.

The fair value methods are income-based valuation approaches, which require judgment to estimate appropriate discount rates, probability of success rates related to the drug under development, projected revenue, gross margins, operating costs, and growth rates.

The contingent consideration liability, associated with our business combination, is estimated based on the discounted cash flow method to determine the probability of achieving certain milestones.

In order to perform the fair value calculations, the following estimates are considered:

probability of achieving certain milestones, discount period, and discount rates.

We believe our assumptions, estimates, and judgements to be reasonable, but which are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates.

Estimates associated with the accounting for acquisitions may change as additional information becomes available regarding the assets acquired and liabilities assumed.

Recent adopted accounting pronouncements

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Components of Statements of Operations

There was no revenue for the year ended December 31, 2025.

For the year ended December 31, 2024, the Company’s revenue was generated from a patent license agreement to develop cavrotolimod for potential treatment for hepatitis with a private clinical stage biopharmaceutical company.

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Research and development expense

Research and development expense consisted of costs associated with our research activities, including basic research on our SNA technology platform, discovery and development of novel SNAs as prospective therapeutic candidates, preclinical and clinical development activities for SNAs we have nominated for clinical development as well as maintaining and protecting our intellectual property.

Our research and development expenses in the prior year presented include:

• employee-related expenses, including salaries, bonuses, benefits and equity-based compensation expense;

• early research and development expenses incurred under arrangements with third parties, such as contract research organizations, contract manufacturing organizations, and consultants;

• preclinical and clinical development expenses with third parties such as contract research organizations, contract manufacturing organizations, and consultants;

• costs of maintaining and protecting our intellectual property portfolio, including legal advisory fees, license fees, sublicense fees, patent maintenance and other similar fees;

• laboratory materials and supplies;

• facilities, depreciation and other allocated expenses, which include direct and allocated expenses for rent and maintenance of facilities, depreciation of leasehold improvements and equipment and laboratory and other supplies.

As previously announced, we halted all research and development activities in 2022 and stopped recording any research and development expenses after the first quarter of 2023 until the acquisition of GPCR USA in the first quarter of 2025.

Research and development expense consisted of costs associated with GPCR USA’s research activities, including clinical development expenses with third parties such as contract research organization, costs and services to complete its Phase 2 clinical trial, and employee-related expenses, including salaries, bonuses, and benefits.

We expensed research and development costs as they were incurred.

A significant portion of our research and development costs were not tracked by project as they benefit multiple projects or our technology.

As previously announced, we halted all research and development activities in 2022 and no longer incurred research and development expenses after the first quarter of 2023.

General and administrative expense

General and administrative expense consists primarily of salaries and related benefits, including equity-based compensation, related to our executive, finance, legal, business development and support functions.

Other general and administrative expenses include travel expenses, professional fees for auditing, tax and legal services and allocated facility-related costs not otherwise included in research and development expenses.

Other general and administrative expenses include travel expenses, professional fees for auditing, tax and legal services and facility-related costs.

Litigation legal expense

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This loss resulted from the impairment analysis of the Company’s right-of-use asset related to its office lease.

Changes in fair value of investment in convertible notes receivable

The changes in fair value of investment in convertible notes receivable relate to the impairment of the convertible notes receivable and reserved their entire $2 million amount.

Dividend income

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During the year, the Company agreed to settle overdue legal expenses incurred in the prior year at a discounted amount resulting in a gain on this transaction.

The Company sold samples of its clinical products during the second quarter to a private clinical stage biopharmaceutical company.

In the fourth quarter, the Company sold certain assets pursuant to the purchase agreement with the Purchaser.

The Company sold samples of its clinical products during the second quarter of 2024 to a private clinical stage biopharmaceutical company.

In the fourth quarter of 2024, the Company sold certain assets pursuant to the purchase agreement with the purchaser.

Results of Operations

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Loss from sale of property and equipment 90 — 90 100 %

Gain on early lease termination (5,974) — (5,974) 100 %

Total operating expenses 4,233 12,732 (8,499) (67) %

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Other (expense) income, net:

Changes in fair value of investment in convertible notes receivable — (2,000) 2,000 100 %

Dividend income 107 5 102 2,040 %

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Gain on settlement of accounts payables 346 407 (61) 100 %

Other income, net 2,137 (2) 2,139 100 %

Total other income (expense), net 2,539 (1,918) 4,457 (232) %

Change in fair value of contingent liability (1,553) — (1,553) 100 %

Other (expense) income, net (275) 2,137 (2,412) 100 %

Total other (expense) income, net (1,347) 2,539 (3,886) (153) %

Net loss before provision for income taxes (5,580) (9,693) 4,113 (42) %

Provision for income taxes 8 — 8 (100) %

Provision (benefit) for income taxes (634) 8 (642) (100) %

Net loss $ (4,946) $ (9,701) $ 4,755 (49) %

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Under the terms of the agreement, this biopharmaceutical company received an exclusive license in the field of hepatitis to all of the Company’s relevant patents.

$500,000 was paid to the Company after the execution of this agreement.

A total of $0.5 million was paid to the Company after the execution of this agreement.

Our ability to generate revenues in the future is dependent on our ability to successfully explore and execute strategic alternatives.

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Research and development expense

Research and development expense was $0 for the year ended December 31, 2024, a $1.4 million decrease from the year ended December 31, 2023.

In 2022, the Company suspended its clinical, preclinical, and discovery program activities and reduced headcount as it began exploring strategic alternatives in April 2023.

As a result, after

the first quarter of 2023, the Company determined it was no longer appropriate to record any research and development expenses.

The following table summarizes our research and development expenses incurred during the periods indicated:

(dollars in thousands) 2025 2024 Change

Employee-related expense $ 1,027 $ — $ 1,027 100 %

Clinical development programs expense 2,259 — 2,259 100 %

Total research and development expense $ 3,286 $ — $ 3,286 100 %

Research and development expense was $3.3 million for the year ended December 31, 2025, a $3.3 million increase from the year ended December 31, 2024.

The Company incurred research and development expense in 2025 after the acquisition of GPCR USA.

In 2022, the Company suspended its clinical, preclinical, and discovery program activities and reduced headcount as it began exploring strategic alternatives in April 2023 and stopped recording any research and development expenses until the acquisition of GPCR USA in the first quarter of 2025.

General and administrative expense

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Full time employees 7 6 1

General and administrative expense was $5.4 million for the year ended December 31, 2024, representing an decrease of $6.3 million, or 53%, from $11.7 million for the year ended December 31, 2023.

The decrease for the year ended December 31, 2024 was due to higher costs in 2023 from separation pay of former executives and related stock based compensation expense, payroll and related benefits, legal and consulting fees, facility and lease costs, depreciation from assets sold, and the research and development wind down costs that no longer met the criteria to be classified as research and development due to the shift in our historical operations suspending all research and development activities as previous discussed.

General and administrative expense was $6.8 million for the year ended December 31, 2025, representing an increase of $1.4 million, or 25%, from $5.4 million for the year ended December 31, 2024.

The increase for the year ended December 31, 2025 was to the additional expenses incurred from the acquisition of GPCR USA.

Litigation legal expense

The increase of $0.6 million for the year ended December 31, 2024 was due to accruals recorded for the amount of the unsatisfied self-insured retainer and legal defense costs related to the securities litigation lawsuit.

The $1.6 million for the year ended December 31, 2024 was due to accruals recorded for the amount of the unsatisfied self-insured retainer and legal defense costs related to the securities litigation lawsuit.

Right-of-use asset impairment loss

This loss resulted from the impairment analysis of the Company’s right-of-use asset related to its office lease.

Loss from sale of property and equipment

In the third quarter of 2023, the Company sold the majority of its scientific equipment through a third party auctioneer and incurred a loss on the sale of these assets as a result.

Changes in fair value of investment in convertible notes receivable

Changes in fair value became known and the Company impaired the entire $2 million amount of these convertible notes receivable.

As a result, the convertible notes receivable is recognized at a fair value of $0 as of December 31, 2024.

Gain on settlement of accounts payable

During the year, the Company agreed to settle overdue legal expenses incurred in the prior year at a discounted amount resulting in a gain on this transaction.

The Company sold samples of its clinical products during the second quarter to a private clinical stage biopharmaceutical company.

On September 27, 2024, the Company entered into and closed the sale of certain assets pursuant to the purchase agreement with the Purchaser.

The assets sold to Purchaser include the Company’s spherical nucleic acid-related technology, research and development programs, and clinical assets (the “Acquired Assets”) to the Purchaser as described in the purchase agreement.

The Company will receive gross proceeds of $1,500 from the sale of the Acquired Assets.

This loss for the year ended December 31, 2024 resulted from the impairment analysis of the Company’s right-of-use asset related to its office lease.

Loss from sale or disposal of property and equipment

The Company recognized a $90,000 loss from the sale of GPCR USA’s fixed assets.

Gain on early lease termination

Due to the early termination of the Chicago Lease as of January 31, 2025, the Company recognized a $6.0 million gain resulting from the reversal of the remaining liability related to this lease.

Other income and expense

The Company recognized a gain of $346,000 from satisfying its self-insured retainer with the insurer and from the reversal of liability related to registration rights delay amounts owed to DGP.

The Company recognized a loss of $1.6 million related to the change in the fair value of its contingent liability.

The Company recognized a loss of $275,000 related to the sale of its subsidiary, KC Creation, as well as additional currency translation losses associated with this foreign subsidiary.

The Company sold samples of its clinical products during the second quarter of 2024 to a private clinical stage biopharmaceutical company.

During the third quarter of 2024, the Company sold certain assets pursuant to a purchase agreement for $1.5 million to the purchaser for the Company’s historical biotechnology intellectual

property and other assets and included spherical nucleic acid-related technology, research and development programs, and clinical assets.

Provision for income taxes

The Company recognized an income tax benefit for the year ended December 31, 2025 as a result of the GPCR USA acquisition.

The effective tax rate for the year ended December 31, 2025 is attributable to the fact that the Company is subject to state income taxes.

The effective income tax rate for the year ended December 31, 2024 was (0.1)%

because the Company generated tax losses and provided a full valuation allowance against its deferred tax assets to an amount that is more likely than not to be realized.

The effective income tax rate for the year ended December 31, 2025 was 11.4% because the Company generated tax losses and provided a full valuation allowance against its deferred tax assets to an amount that is more likely than not to be realized.

The effective tax rate for the year ended December 31, 2024 of 11.4% was attributable to the fact the Company was subject to the IRC Section 174 regulations requiring companies to capitalize certain research and experimental expenditures and IRC Section 382 loss limitation rules on our ability to utilize net operating losses to offset the capitalization requirement, with the ownership change being in the fourth quarter of 2022.

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Net cash used in operating activities was $8.6 million and $2.9 million for the years ended December 31, 2025 and 2024, respectively.

The decrease in cash used in operating activities for the year ended December 31, 2024 of $7.4 million was due to the reduction of operating activities, spending and lower headcount.

The increase in cash used in operating activities for the year ended December 31, 2025 of $5.6 million was due to the increase of operating activities and higher headcount from the GPCR USA acquisition.

Investing activities

Net cash used in investing activities was $1.8 million and $0.0 million for the years ended December 31, 2025 and 2024, respectively.

The decrease in cash used in investing activities of $1.1 million was primarily due to a decrease in proceeds from the maturity, net of purchases, of available-for-sale securities.

The increase in cash used in investing activities of $1.8 million was due to purchase of GPCR USA and capital expenditures by KC Creation.

Financing activities

Net cash provided by financing activities of $13.4 million for year ended December 31, 2024 is primarily due to the stock purchase agreements closed in November and December 2024.

Net cash provided by financing activities of $3.7 million for the year ended December 31, 2023 is primarily due to the Private Placement closed in February 2023.

Net cash provided by financing activities of $1.6 million for year ended December 31, 2025 was due to the funds received from the common stock purchase agreement in February 2025.

Net cash provided by financing activities of $13.4 million for the year ended December 31, 2024 was due to the stock purchase agreements closed in November and December 2024.

Funding Requirements

Our existing cash and cash equivalents may not be sufficient to enable us to fund our existing obligations and ongoing operating expenses for the near term.

Our existing cash and cash equivalents are not sufficient to enable us to fund our existing obligations and ongoing operating expenses for the near term.

Our future capital requirements are difficult to forecast and will depend on many factors, including:

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Debt financing and preferred equity financing, if available, may involve agreements that include restrictive covenants that limit our ability to take specified actions, such as incurring additional debt, making capital expenditures or declaring dividends.

Further, the global financial markets have experienced significant disruptions over the past couple of years due to the COVID-19 pandemic, the ongoing conflict between Russia and Ukraine, and worsening global macroeconomic conditions, including actions taken by central banks to counter inflation, volatility in the capital markets and related market uncertainty, may impact our ability to obtain additional financing when needed on favorable terms or at all.

Further, the global financial markets have experienced significant disruptions over the past couple of years due to global health crisis, the ongoing conflict between Russia and Ukraine, and in the Middle East, and worsening global macroeconomic conditions, including actions taken by central banks to counter inflation, volatility in the capital markets and related market uncertainty, may impact our ability to obtain additional financing when needed on favorable terms or at all.

Any further disruption or slowdown in the global financial markets and economy may negatively affect our ability to raise funding through equity or debt financings on attractive terms or at all, which could in the future negatively affect our operations.

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Contractual Obligations and Commitments

Chicago Lease

Redwood City Lease and Chicago Lease

Refer to Note 5 - Leases to the Notes to our Consolidated Financial Statements included herein.

Quantitative and Qualitative Disclosures About Market Risk.

We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide this information required under this item.

As a smaller reporting company, as defined by Rule 12b-2 of the Exchange Act and in Item 10(f)(1) of Regulation S-K, we are electing scaled disclosure reporting obligations and therefore 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 7. Management’s Discussion and Analysis