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<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The
stock options outstanding as of September 30, 2019 and December 31, 2018, summarized by exercise prices, are as follows:</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: left; margin-left: 0.5in"></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 80%; font: 10pt Times New Roman, Times, Serif; margin-left: 0.7in">
<tr style="vertical-align: bottom">
<td colspan="2" style="text-align: center; border-bottom: Black 1.5pt solid">Exercise price $</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="text-align: center; border-bottom: Black 1.5pt solid">Stock options outstanding as of September 30, 2019</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="text-align: center; border-bottom: Black 1.5pt solid">Stock options outstanding as of December 31, 2018</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="text-align: center; border-bottom: Black 1.5pt solid">Weighted average remaining contractual life – years as of September 30, 2019</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="text-align: center; border-bottom: Black 1.5pt solid">Weighted average remaining contractual life – years as of December 31, 2018</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="text-align: center; border-bottom: Black 1.5pt solid">Stock options exercisable as of September 30, 2019</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="text-align: center; border-bottom: Black 1.5pt solid">Stock options exercisable as of December 31, 2018</td><td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom">
<td colspan="2"> </td><td> </td><td> </td>
<td colspan="2"> </td><td> </td><td> </td>
<td colspan="2"> </td><td> </td><td> </td>
<td colspan="2"> </td><td> </td><td> </td>
<td colspan="2"> </td><td> </td><td> </td>
<td colspan="2"> </td><td> </td><td> </td>
<td colspan="2"> </td><td> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="width: 1%; text-align: left"> </td><td style="width: 11%; text-align: right">4.20</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td>
<td style="width: 1%; text-align: left"> </td><td style="width: 11%; text-align: right">77,846</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td>
<td style="width: 1%; text-align: left"> </td><td style="width: 11%; text-align: right">77,846</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td>
<td style="width: 1%; text-align: left"> </td><td style="width: 11%; text-align: right">6.3</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td>
<td style="width: 1%; text-align: left"> </td><td style="width: 10%; text-align: right">7.0</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td>
<td style="width: 1%; text-align: left"> </td><td style="width: 10%; text-align: right">77,846</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td>
<td style="width: 1%; text-align: left"> </td><td style="width: 10%; text-align: right">77,846</td><td style="width: 1%; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left"> </td><td style="text-align: right">15.75</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">133,546</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">133,546</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">8.0</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">8.8</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">83,005</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">53,752</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left"> </td><td style="text-align: right">8.60</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">11,630</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">-</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">9.3</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">-</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">4,645</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">-</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left"> </td><td style="text-align: right">9.00</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">10,000</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">10,000</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">9.0</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">9.8</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">4,000</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">-</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left"> </td><td style="text-align: right">19.35</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">72,508</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">72,508</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">8.0</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">8.8</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">45,318</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">29,003</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left"> </td><td style="text-align: right">5.95</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">17,503</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">-</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">2.8</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">-</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">-</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">-</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="text-align: left"> </td><td style="text-align: right">15.30</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">41,866</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">41,866</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">8.3</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">9.0</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">29,367</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">21,867</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(*</font></td><td style="padding-bottom: 1.5pt; text-align: left">)</td><td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">62,542</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">62,542</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">7.0</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">7.8</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">62,542</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">62,542</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt; text-align: right"> </td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">427,441</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">398,308</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">6.3</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">7.3</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">306,723</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">245,010</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: left; margin-left: 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"></font></p>
<div style="margin-top: 0; margin-bottom: 0; width: 25%; margin-left: 0.7in"><div style="font-size: 1pt; border-top: Black 1.5pt solid"> </div></div>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">(*)
Less than $0.01.</p>
Non-accelerated Filer
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31462000
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true
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3375000
3375000
<p style="margin: 0pt"></p>
<table cellspacing="0" cellpadding="0" style="width: 100%; border-collapse: collapse">
<tr>
<td style="width: 67px; font: 12pt Times New Roman, Times, Serif"><font style="font-size: 10pt"><b>NOTE 1 -</b></font></td>
<td style="font: 12pt Times New Roman, Times, Serif"><font style="font-size: 10pt"><b>GENERAL</b></font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b>A. Description of Business:</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">Microbot Medical Inc. (the “Company”)
is a pre-clinical medical device company specializing in the research, design and development of next generation micro-robotics
assisted medical technologies targeting the minimally invasive surgery space. The Company is primarily focused on leveraging its
micro-robotic technologies with the goal of improving surgical outcomes for patients.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">It was incorporated on August 2,
1988 in the State of Delaware under the name Cellular Transplants, Inc. The original Certificate of Incorporation was restated
on February 14, 1992 to change the name of the Company to Cyto Therapeutics, Inc. On May 24, 2000, the Certificate of Incorporation
as restated was further amended to change the name of the Company to StemCells, Inc.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">On November 28, 2016, the Company
consummated a transaction pursuant to an Agreement and Plan of Merger, dated August 15, 2016, with Microbot Medical Ltd., a private
medical device company organized under the laws of the State of Israel (“Microbot Israel”). On the same day and in
connection with the Merger, the Company changed its name from StemCells, Inc. to Microbot Medical Inc. On November 29, 2016, the
Company’s common stock began trading on the Nasdaq Capital Market under the symbol “MBOT”.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">Prior to the Merger, the Company
was a biopharmaceutical company that conducted research, development, and commercialization of stem cell therapeutics and related
technologies. The sale of substantially all material assets relating to the stem cell business were completed on November 29, 2016.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">The Company and its subsidiaries
are collectively referred to as the “Company”. “StemCells” or “StemCells, Inc.” refers to the
Company prior to the Merger.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b>B. Going Concern:</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">The unaudited financial statements
as of September 30, 2019 have been prepared under the assumption that the Company will continue as a going concern for the next
12 months. The Company’s ability to continue as a going concern is dependent upon its uncertain ability to obtain additional
equity and/or debt financing and reduce expenditures. The Company has incurred operating losses and negative cash flows from operating
activities each year since inception. As of September 30, 2019, the Company had an accumulated deficit of approximately $33,241.
Due to continuing research and development activities, the Company expects to continue to incur additional losses for the foreseeable
future. The Company’s management plans to continue to fund its current operations as well as other development activities
relating to additional product candidates, through future issuances of either debt and/or equity securities and possibly additional
grants from the Israeli Innovation Authority and other government institutions. The Company’s ability to raise additional
capital in the equity and debt markets is dependent on a number of factors, including, but not limited to, the market demand for
the Company’s stock, which itself is subject to a number of development and business risks and uncertainties, as well as
the uncertainty that the Company would be able to raise such additional capital at a price or on terms that are favorable to the
Company. These factors raise substantial doubt to the company’s ability to continue as a going concern.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">The accompanying financial statements
as of September 30, 2019 do not include any adjustments that might result from the outcome of this uncertainty. If the Company
is unable to continue as a going concern, it may have to liquidate its assets and may receive less than the value at which those
assets are carried on the financial statements.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b>C. Use of Estimates:</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">The preparation of financial statements
in conformity with U.S. GAAP requires management to make estimates and assumptions pertaining to transactions and matters whose
ultimate effect on the financial statements cannot precisely be determined at the time of financial statements preparation. Although
these estimates are based on management’s best judgment, actual results may differ from these estimates.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b>D. Reverse Stock Split:</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">On September 4, 2018, the Company
filed a Certificate of Amendment to its Restated Certificate of Incorporation with the Secretary of State of the State of Delaware
to affect a one-for-15 reverse stock split of the Company’s common stock (the “Reverse Split”). As a result
of the Reverse Split, every 15 shares of the Company’s old common stock were converted into one share of the Company’s
new common stock. Fractional shares resulting from the Reverse Split were rounded up to the nearest whole number. The Reverse
Split automatically and proportionately adjusted, based on the one-for-fifteen split ratio, all issued and outstanding shares
of the Company’s common stock, as well as common stock underlying convertible preferred stock, stock options, warrants and
other derivative securities outstanding at the time of the effectiveness of the Reverse Split. The exercise price on outstanding
equity based-grants was proportionately increased, while the number of shares available under the Company’s equity-based
plans was also proportionately reduced. Share and per share data (except par value) for the periods presented reflect the effects
of the Reverse Split. References to numbers of shares of common stock and per share data in the accompanying financial statements
and notes thereto for periods ended prior to September 4, 2018 have been adjusted to reflect the Reverse Split on a retroactive
basis.</p>
<p style="margin: 0pt"></p>
<table cellspacing="0" cellpadding="0" style="width: 100%; border-collapse: collapse">
<tr style="vertical-align: top">
<td style="width: 67px; font: 11pt Calibri, Helvetica, Sans-Serif; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><b>NOTE 2 -</b></font></td>
<td style="font: 11pt Calibri, Helvetica, Sans-Serif; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><b>SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES</b></font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b>Unaudited Interim Financial Statements:</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">The accompanying unaudited interim
condensed consolidated financial statements have been prepared in accordance with U.S. GAAP for interim financial information and
with the instructions to Form 10-Q and Article 10 of U.S. Securities and Exchange Commission (“SEC”) regulations. Accordingly,
they do not include all the information and footnotes required by GAAP for complete financial statements. In the opinion of management,
all adjustments considered necessary for a fair presentation have been included (consisting only of normal recurring adjustments
except as otherwise discussed).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">Operating results for the three-
and nine-month periods ended September 30, 2019, are not necessarily indicative of the results that may be expected for the year
ended December 31, 2019.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b>Significant Accounting Policies:</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">The significant accounting policies
followed in the preparation of these unaudited interim condensed consolidated financial statements are identical to those applied
in the preparation of the latest annual audited financial statements with the exception of the following:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b>Short-term Investments:</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">The Company began investing excess
cash in short-term investments during the first quarter of 2019.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">Marketable debt securities are considered
to be available for sale and are carried at fair value. Unrealized gains and losses net of tax, if any, are reported as a separate
component of shareholders’ equity. The cost of marketable debt securities classified as available for sale is adjusted for
amortization of premiums and accretion of discounts to maturity. Such amortization and accretion are included in interest income.
Realized gains and losses and declines in value judged to be other than temporary, if any, are also included in other income, net.
Interest on securities classified as available for sale is included in interest income. The cost of securities sold is based on
the specific identification method.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">Management evaluates whether available-for-sale
securities are other-than-temporarily impaired (OTTI) on a quarterly basis. Debt securities with unrealized losses are considered
OTTI if the Company intends to sell the security or if it is more likely than not that the Company will be required to sell such
security prior to any anticipated recovery. If management determines that a security is OTTI under these circumstances, the impairment
recognized in earnings is measured as the entire difference between the amortized cost and the then-current fair value. During
the three and nine-months ended September 30, 2019, no investment OTTI losses were realized.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b>Fair Value of Financial Instruments:</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">The carrying values of cash and cash
equivalents, other receivable and other accounts payable and accrued liabilities approximate their fair value due to the short-term
maturity of these instruments.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">The Company measures the fair value
of certain of its financial instruments (marketable debt security) on a recurring basis.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">A fair value hierarchy is used to
rank the quality and reliability of the information used to determine fair values. Financial assets and liabilities carried at
fair value will be classified and disclosed in one of the following three categories:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b>Level 1 </b>- Quoted prices
(unadjusted) in active markets for identical assets and liabilities.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b>Level 2</b> - Inputs other
than Level 1 that are observable, either directly or indirectly, such as unadjusted quoted prices for similar assets and liabilities,
unadjusted quoted prices in the markets that are not active, or other inputs that are observable or can be corroborated by observable
market data for substantially the full term of the assets or liabilities.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b>Level 3</b> - Unobservable
inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b>Reclassifications:<br />
<br />
</b>Certain prior period amounts have been reclassified to conform to current period presentation.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b>Leases:</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">In February 2016, the Financial Accounting
Standards Board (“FASB”) issued ASU 2016-02, Leases (Topic 842). This ASU requires entities that lease assets to recognize
on the balance sheet the assets and liabilities for the rights and obligations created by leases with lease terms of more than
12 months. The Company adopted this ASU effective January 1, 2019 using the modified retrospective application, applying the new
standard to leases in place as of the adoption date. Prior periods have not been adjusted.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">Arrangements that are determined
to be leases at inception are recognized as long-term right-of-use assets (“ROU”) and lease liabilities in the condensed
consolidated balance sheet at lease commencement. Operating lease ROU assets and operating lease liabilities are recognized based
on the present value of the future fixed lease payments over the lease term at commencement date. As most of the Company’s
leases do not provide an implicit rate, the Company applies its incremental borrowing rate based on the economic environment at
commencement date in determining the present value of future payments. Lease terms may include options to extend or terminate the
lease when it is reasonably certain that the Company will exercise that option. Lease expense for operating leases or payments
are recognized on a straight-line basis over the lease term.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b>Warrants:</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">Prior to January 1, 2019, warrants
with non-standard anti-dilution provisions (referred to as down round protection) were classified as liabilities and re-measured
each reporting period. On January 1, 2019, the Company adopted the provisions of Accounting Standards Update (“ASU”)
2017-11, which includes Part I “Accounting for Certain Financial Instruments with Down Round Features” and Part II
“Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and
Certain Mandatorily Redeemable Non-Controlling Interests with a Scope Exception”, which indicates that a down round feature
no longer precludes equity classification when assessing whether an investment is indexed to an entity’s own stock. The Company
used a full retrospective approach to adoption and restated its financial statements as of the earliest period presented. As a
result of the adoption of ASU 2017-11, the Company’s warrants were reclassified from liabilities to shareholders’ equity.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">The cumulative effect of adoption
of ASU 2017-11 resulted as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"> </p>
<table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">For the<br />
Nine Months ended<br />
September 30, 2018</font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">For the<br />
year ended<br />
December 31 2018</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 41%"><font style="font: 10pt Times New Roman, Times, Serif">Derivative warrant liability</font></td>
<td style="width: 2%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 27%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">           (5</font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 25%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">          (8)</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Additional paid-in capital</font></td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">3</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">28</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Accumulated deficit</font></td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">20</font></td>
<td> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">Refer to Note 6 for further information
regarding the outstanding warrants as of September 30, 2019.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b>Recent Accounting Standards:</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">In June 2016, the FASB issued ASU
2016-13 “Financial Instruments – Credit Losses” to improve information on credit losses for financial assets
and net investment in leases that are not accounted for at fair value through net income. This ASU replaces the current incurred
loss impairment methodology with a methodology that reflects expected credit losses. This ASU is effective for the Company in the
first quarter of 2020, with early adoption permitted. The Company does not expect that this ASU will have a material effect on
the Company’s consolidated financial statements.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">In August 2018, the FASB issued
ASU 2018-13, “Changes to Disclosure Requirements for Fair Value Measurements”, which will improve the effectiveness
of disclosure requirements for recurring and nonrecurring fair value measurements. This ASU removes, modifies, and adds certain
disclosure requirements, and is effective for the Company beginning on January 1, 2020. The Company does not expect that this
ASU will have a material effect on the Company’s consolidated financial statements.</p>
<p style="margin: 0pt"></p>
<table cellspacing="0" cellpadding="0" style="width: 100%; border-collapse: collapse">
<tr style="vertical-align: top">
<td style="width: 67px; font: 11pt Calibri, Helvetica, Sans-Serif; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><b>NOTE 5 -</b></font></td>
<td style="font: 11pt Calibri, Helvetica, Sans-Serif; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><b>COMMITMENTS AND CONTINGENCIES</b></font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b>Government Grants:</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">Microbot Israel obtained from the
Israeli Innovation Authority (“IIA”) grants for participation in research and development for the years 2013 through
September 30, 2019 in the total amount of approximately $1,500 and, in return, Microbot Israel is obligated to pay royalties amounting
to 3%-3.5% of its future sales up to the amount of the grant. The grant is linked to the exchange rate of the dollar to the New
Israeli Shekel and bears interest of Libor per annum.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">The repayment of the grants is contingent
upon the successful completion of the Company’s research and development programs and generating sales. The Company has no
obligation to repay these grants, if the project fails, is unsuccessful or aborted or if no sales are generated. The financial
risk is assumed completely by the Government of Israel. The grants are received from the Government on a project-by-project basis.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b>TRDF Agreement:</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">Microbot Israel signed an agreement
with the Technion Research and Development Foundation (“TRDF”) in June 2012 by which TRDF transferred to Microbot Israel
a global, exclusive, royalty-bearing license. As partial consideration for the license, Microbot Israel shall pay TRDF royalties
on net sales (between 1.5%-3%) and on sublicense income as detailed in the agreement.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b>Contract Research Agreements:</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><u>Agreement with Washington University</u></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">On January 27, 2017, the Company
entered into a Contract Research Agreement (the “Research Agreement”) with The Washington University (“Washington
U.”), pursuant to which the parties are collaborating to determine the effectiveness of the Company’s self-cleaning
shunt.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify; color: #222222"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">The study in Washington U. includes
several phases. The first phase (initial research) was completed. An agreement on the second phase was entered in September 2018
with total expected costs of approximately $248. As of September 30, 2019, his study is still on going and will be extended to
continue until March 1, 2020. Pursuant to the Research Agreement, all rights, title and interest in the data, information and results
obtained or arrived at by Washington U. in the performance of its services under the Research Agreement, as well as any patentable
inventions obtained or arrived at in the performance of such services, will be jointly owned by the Company and Washington U.,
and each will have full right to practice and grant licenses in joint inventions. Additionally, Washington U. granted to the Company:
(a) a non-exclusive, worldwide, royalty-free, fully paid-up, perpetual and irrevocable license to use and practice patentable inventions
(other than joint inventions and improvements to Washington U.’s animal models) obtained or arrived at by Washington U. in
the provision of its services under the Research Agreement (“University Inventions”) with respect to the self-cleaning
shunt; and (b) an exclusive option to obtain an exclusive worldwide license in University Inventions, on terms to be negotiated
between the parties.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><u>Agreement with Wayne State University</u></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">On September 12, 2016, the Company
entered into a research agreement (the “WSU Agreement”) with Wayne State University (“WSU.”), pursuant
to which the parties are collaborating to determine the efficacy of the Company’s self-cleaning shunt.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">The study in WSU includes several
phases. The first phase (initial research) was completed. An agreement on the second phase was entered in April 2018 with total
expected costs of approximately $130. In July 2018 the contract was updated to include phase 2.1 (preliminary phase to phase 2)
with total expected costs of approximately $213. Pursuant to the WSU Agreement, WSU shall own all data generated by the research
and the Company shall have unrestricted free right to use and disclose all the results, information and material generated from
the WSU Agreement.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">Rights to inventions, improvements
or discoveries, whether or not patentable or copyrightable made solely by the employees of the Company in the course of performance
of the workplan agreed upon between the Company and WSU shall belong to the Company.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">Rights to inventions, improvements
or discoveries, whether or not patentable or copyrightable made solely by the employees of WSU in the course of performance of
the workplan agreed upon between the Company and WSU shall belong to WSU. WSU shall grant the Company with a worldwide non-exclusive,
perpetual, royalty-free license to university inventions to use and practice patentable inventions.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">Rights to inventions, improvements
or discoveries, whether or not patentable or copyrightable made by at least one employee of WSU and one employee of the Company
in the course of performance of the workplan agreed upon between the Company and WSU shall belong to WSU and the Company jointly.
Both the Company and WSU will be free to use and license to others the rights of joint inventions for any and all purposes without
consultation or obligation to the other party. WSU granted the Company a first option to negotiate an exclusive license to use
and practice WSU inventions and its interest in the joint inventions as detailed in the WSU Agreement.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify; background-color: white"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify; background-color: white"><b>Sabby Litigation:</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify; background-color: white"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">The Company is named as the defendant
in a lawsuit (the “Matter”), captioned Sabby Healthcare Master Fund Ltd. and Sabby Volatility Warrant Master Fund Ltd.,
Plaintiffs, against Microbot Medical Inc., Defendant, in the Supreme Court of the State of New York, County of New York (the “Court”)
(Index No. 654581/2017). The complaint alleged, among other things, that the Company breached multiple representations and warranties
contained in the Securities Purchase Agreement (the “SPA”) related to the Company’s June 8, 2017 equity financing
(the “Financing”) of which the Plaintiffs participated. The complaint sought rescission of the SPA and return of the
Plaintiffs’ $3,375 purchase price with respect to the Financing, and damages in an amount to be determined at trial, but
alleged to exceed $1 million. A trial was held on February 11, 2019. On February 28, 2019, the Court issued a Decision and Order
After Trial to rescind the SPA. The rescission would require the Plaintiffs to transfer back to the Company the shares they purchased
in the Financing, and for the Company to return to Plaintiffs their purchase price of $3,375. Accordingly, the Company recorded
a provision for extinguishment dispute as of $3,375 in current liabilities against Treasury shares classified in Equity.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">On March 27, 2019, the Company filed
a Notice of Appeal and an Undertaking to stay execution of the judgment pending appeal.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">In accordance with New York law,
in order to move forward with the appeal and to stay the lower court’s judgment, the Company placed approximately $4,200
in escrow with a surety bonding agent on March 26, 2019 in accordance with provisions set forth in the judgment from the Matter,
which represents the judgment amount, plus interest and the fee to the bonding company. Accordingly, the Company recorded additional
expenses of $178 with respect to interest from the judgement date and up until September 30, 2019.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify; background-color: white"><b>Tolling
and Standstill Agreement:</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify; background-color: white"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify; background-color: white">On April
4, 2018, Microbot entered into a Tolling and Standstill Agreement with Empery Asset Master, Ltd., Empery Tax Efficient LP, Empery
Tax Efficient II LP, and Hudson Bay Master Fund, Ltd., the other investors in the Financing (“Other Investors”). Pursuant
to the Tolling Agreement, among other things, (a) the Other Investors agree not to bring any claims against Microbot arising out
of the Matter, (b) the parties agree that if Microbot reaches an agreement to settle the claims asserted by the Sabby Funds in
the above suit, Microbot will provide the same settlement terms on a pro rata basis to the Other Investors, and the Other Investors
will either accept same or waive all of their claims and (c) the parties froze in time the rights and privileges of each party
as of the effective date of the Tolling Agreement, until (i) an agreement to settle the suit is executed; (ii) a judgment in the
suit is obtained; or (iii) the suit is otherwise dismissed with prejudice.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify; background-color: white"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">No provision has been recorded with
respect to the Tolling Agreement since no settlement was reached with respect to the Matter.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify; background-color: white"><b>Alliance Litigation:</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify; background-color: white"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify; background-color: white">On April
28, 2019, the Company brought an action against Alliance Investment Management, Ltd. (“Alliance”) in the Southern District
of New York under Section 16(b) of the Securities Exchange Act of 1934, 15 U.S.C. 78p(b), to compel Alliance to disgorge short
swing profits realized by Alliance from purchases and sales of the Company’s securities within a period of less than six
months, while Alliance was a beneficial owner of more than 10% of the Company’s outstanding common stock and a statutory
“insider” for purposes of the statute. The case is Microbot Medical Inc. v. Alliance Investment Management, Ltd.,
No. 19-cv-3782-GBD (SDNY). The amount of profits the Company is seeking to divest is estimated to be approximately $480,000.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify; background-color: white">On August
21, 2019, Alliance filed an answer to the Company’s action claiming that Alliance’s client Joseph Mona was the “beneficial
owner” of the shares traded by Alliance. On October 18, 21, and 28, Joseph Mona filed Section 16(a) and Schedule 13G reports,
which are substantially similar to the reports previously filed by Alliance.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify; background-color: white">On October
28, 2019, Alliance filed a motion for summary judgment requesting that the Court dismiss the claims against Alliance in view of
Joseph Mona’s SEC filings. On November 7, 2019, U.S. Magistrate Judge Robert W. Lehrburger ordered Alliance to produce relevant
trading records, to enable the Company to determine whether to proceed against Alliance and/or Joseph Mona. Alliance has agreed
to postpone the Company’s response to their motion for summary judgment pending Alliance’s required production of the
trading records.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify; background-color: white"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify; background-color: white"><b>Agreement
with CardioSert Ltd.:</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">On January 4, 2018, Microbot Israel
entered into an agreement with CardioSert Ltd. (“CardioSert”) to acquire certain patent-protected technology owned
by CardioSert (the “Technology”).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">Pursuant to the Agreement, Microbot
Israel made an initial payment of $50 to CardioSert and had 90-days to elect to complete the acquisition. At the end of the 90-day
period, at Microbot Israel’s sole option, CardioSert shall assign and transfer the Technology to Microbot Israel and Microbot
Israel shall pay to CardioSert additional amounts and securities as determined in the agreement.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">On April 10, 2018, Microbot delivered
an Exercise Notice to CardioSert Ltd., notifying it that Microbot elected to exercise the option to acquire the Technology owned
by CardioSert and therefore made an additional cash payment of $250 and 6,738 shares of common stock (100,000 shares of common
stock before the Reverse Split) estimated at $74.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">The agreement may be terminated by
Microbot Israel at any time for convenience upon 90-days’ notice. The agreement may be terminated by CardioSert in case the
first commercial sale does not occur by the third anniversary of the date of signing of the agreement except if Microbot Israel
has invested more than $2,000 in certain development stages, or the first commercial sale does not occur within 50 months. In each
of the above termination events, or in case of breach by Microbot Israel, CardioSert shall have the right to buy back the Technology
from Microbot Israel for $1.00, upon 60 days prior written notice, but only 1 year after such termination. Additionally, the agreement
may be terminated by either party upon breach of the other (subject to cure).</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify; background-color: white"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify; background-color: white">CardioSert
agreed to assist Microbot Israel in the development of the Technology for a minimum of one year, for a monthly consultation fee
of NIS 40,000 covering up to 60 consulting hours per month.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify; background-color: white"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify; background-color: white"><b>Yehezkel
(Hezi) Himelfarb Resignation:</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify; background-color: white"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify; background-color: white">Effective
as of February 1, 2019, Yehezkel (Hezi) Himelfarb, a member of the Board of Directors of the Company, and the Company’s
Chief Operating Officer, resigned from all positions with the Company. Effective as of February 1, 2019, Mr. Himelfarb also resigned
from his position as General Manager of Microbot Medical Ltd., a wholly owned subsidiary of the Company. As a result of Mr. Himelfarb
providing certain post-resignation transition services to the Company until July 31, 2019, Mr. Himelfarb was paid his full salary
and certain benefits through that date.</p>
<p style="margin: 0pt"></p>
<table cellspacing="0" cellpadding="0" style="width: 100%; border-collapse: collapse">
<tr style="vertical-align: top">
<td style="width: 67px; font: 11pt Calibri, Helvetica, Sans-Serif; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><b>NOTE 6 -</b></font></td>
<td style="font: 11pt Calibri, Helvetica, Sans-Serif; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><b>SHARE CAPITAL</b></font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b>Share Capital Developments:</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">On September 10, 2019, the Company
reduced its authorized number of shares of capital stock from 221,000,000 to 61,000,000, including a reduction in the number of
authorized shares of common stock of the Company from 220,000,000 to 60,000,000.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">As of September 30, 2019, the Company
had 4,307,666 shares of common stock issued and outstanding.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">On December 27, 2016, the Company
exchanged 655,962 shares (9,735,925 shares before the Reverse Split) or rights to acquire shares of its common stock, for 9,736
shares of a newly designated class of Series A Convertible Preferred Stock.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">On January 5, 2017, the Company entered
into a definitive securities purchase agreement with an institutional investor (the “Purchaser”) for the purchase and
sale of an aggregate of 47,163 shares (700,000 shares before the Reverse Split) of common stock in a registered direct offering
for $74.00 per share ($5.00 per share before the Reverse Split) or gross proceeds of $3,500. The Company paid the placement agent
a fee of $210 plus reimbursement of out-of-pocket expenses, as well as other offering-related expenses.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">On June 5, 2017, the Company entered
into a Securities Purchase Agreement with certain institutional investors (the “Investors”) providing for the issuance
and sale by the Company to the Investors of an aggregate of 252,652 shares (3,750,000 shares before the Reverse Split) of common
stock, at a purchase price per share of $40.50 ($2.70 before the Reverse Split). The gross proceeds to the Company was $10,125
before deducting placement agent fees and offering expenses of $922. See Note 4 – “Commitments and Contingencies-Litigation”
with respect to certain rescission rights awarded to two affiliated Investors.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">On January 14, 2019, the Company
entered into a Securities Purchase Agreement with an accredited institutional investor providing for the issuance and sale by the
Company to the purchaser of an aggregate of (i) 330,000 shares of the Company’s common stock, at a purchase price per share
of $6.50 and (ii) 125,323 pre-funded warrants each to purchase one share of common stock, at a purchase price per Pre-Funded Warrant
of $6.49. The gross proceeds to the Company were approximately $3,000. The closing of the offering took place on January 15, 2019.
The pre-funded warrants were exercised in full in January 2019.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">On January 15, 2019, the Company
entered into a Securities Purchase Agreement with certain accredited institutional investors providing for the issuance and sale
by the Company to the purchasers of an aggregate of 590,000 shares of the Company’s common stock, at a purchase price per
share of $10.00. The gross proceeds to the Company were approximately $5,900. The closing of the offering took place on January
17, 2019.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">On January 23, 2019 the Company entered
into a Securities Purchase Agreement with accredited institutional investors providing for the issuance and sale by the Company
to the purchasers of an aggregate of 250,000 shares of the Company’s common stock, at a purchase price per share of $9.875.
The gross proceeds to the Company were approximately $2,470. The closing of the offering took place on January 25, 2019.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b>Employee Stock Option Grant:</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">In September 2014, Microbot Israel’s
board of directors approved a grant of 26,906 stock options (403,592 stock options before the Reverse Split) (77,846 stock options
as retroactively adjusted to reflect the Merger) to its CEO, through MEDX Venture Group LLC. Each option was exercisable into an
ordinary share, at an exercise price of $12.00 ($0.80 before the Reverse Split) ($4.20 as retroactively adjusted to reflect the
Merger). The stock options were fully vested at the date of grant.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">On May 2, 2016, Microbot Israel’s
board of directors approved a grant of 33,333 stock options (500,000 stock options before the Reverse Split) (96,482 as retroactively
adjusted to reflect the Merger) to certain of its employees and directors. Each stock option was exercisable into an ordinary share,
NIS 0.001 par value, of Microbot Israel, at an exercise price equal to the ordinary share’s par value. The stock options
were fully vested at the date of grant. As the exercise price of the stock options is nominal, Microbot Israel estimated the fair
value of the options as equal to the Company’s share price of $20.25 ($1.35 before the Reverse Split) ($7.05 as retroactively
adjusted to reflect the Merger) at the date of grant.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">On September 12, 2017, the Company
adopted the 2017 Equity Incentive Plan (the “Plan”), which Plan authorizes, among other things, the grant of options
to purchase shares of common stock to directors, officers and employees of the Company and to other individuals.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">On September 14, 2017, the board
of directors approved a grant of stock options to purchase an aggregate of up to 120,848 shares (1,812,712 shares before the Reverse
Split) of common stock to Mr. Harel Gadot, the Company’s Chairman of the Board, President and CEO, at an exercise price per
share of $15.75 ($1.05 before the Reverse Split). The stock options vest over a period of 3-5 years as outlined in the option agreements.
As a result, the Company recognized compensation expenses for the three months ended September 30, 2019 and 2018 in total amount
of $122 and $121 respectively and for the nine months ended September 30, 2019 and 2018 in total amount of $362 and $460 respectively
included in general and administrative expenses.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">On September 14, 2017, the board
of directors approved a grant of stock options to purchase an aggregate of up to 72,508 shares (1,087,627 shares before the Reverse
Split) of common stock to Mr. Hezi Himelfarb, the Company’s General Manager, COO and a member of the Board, at an exercise
price per share of $19.35 ($1.29 before the Reverse Split). The grant was subject to the Israeli Tax Authority’s approval
of the plan which occurred on October 14, 2017. In accordance with the option agreement, the options vest for period of 3 years
starting from the grand date. As a result, the Company recognized compensation expenses for the three months ended September 30,
2019 and 2018 in the total amount of $108 and $98 respectively and for the nine months ended September 30, 2019 and 2018 in the
total amount of $322 and $329 respectively included in research and development.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">On December 6, 2017, the board of
directors approved a grant of 12,698 stock options (190,475 stock options before the Reverse Split) to purchase an aggregate of
up to 12,698 shares of common stock to certain of its directors, at an exercise price per share of $15.75 ($1.05 before the Reverse
Split). The stock options vest over a period of 3 years as outlined in the option agreements. As a result, the Company recognized
compensation expenses for the three months ended September 30, 2019 and 2018 in the total amount of $13 and $14 respectively and
for the nine months ended September 30, 2019 and 2018 in the total amount of $40 and $55 respectively included in general and administrative
expenses.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">On December 28, 2017, the board of
directors approved a grant of 66,036 stock options (990,543 stock options before the Reverse Split) to purchase an aggregate of
up to 66,036 shares of common stock to certain of its employees, at an exercise price per share of $15.3 ($1.02 before the Reverse
Split). The stock options vest over a period of 3 years as outlined in the option agreements. As a result, the Company recognized
compensation expenses for the three months ended September 30, 2019 and 2018 in the total amount of $37 and $62 respectively and
for the nine months ended September 30, 2019 and 2018 in the total amount of $116 and $273 respectively included in research and
development expenses.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">On November 2017, certain employees
and consultant exercised 31,453 options (471,794 options before the Reverse Split) to 31,453 ordinary shares at exercise price
of 0.001 NIS.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">In February 2018, an employee exercised
options to purchase 2,487 shares (37,300 shares before the Reverse Split) of common stock at an exercise price of $0.001 per share.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">On August 13, 2018, the board of
directors approved a grant of stock options to purchase an aggregate of up to 10,000 shares (150,000 shares before the Reverse
Split) of common stock to a non-executive officer, at an exercise price per share of $9 ($0.6 before the Reverse Split). The grant
was subject to the Israeli Tax Authority’s approval of the plan which occurred on October 14, 2017. In accordance with the
option agreement, the options vest for period of 3 years starting from the grand date. As a result, the Company recognized compensation
expenses for the three months ended September 30, 2019 and 2018 in the total amount of $6 and $22 respectively and for the nine
months ended September 30, 2019 and 2018 in the total amount of $24 and $22 respectively included in research and development expenses.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">On January 21, 2019, the board of
directors approved a grant of 11,630 stock options to purchase an aggregate of up to 11,630 shares of common stock to certain of
its directors, at an exercise price per share of $8.60. The stock options vest over a period of 3 years as outlined in the option
agreements As a result, the Company recognized compensation expenses for the three months ended September 30, 2019 and 2018 in
the total amount of $7 and $0 respectively and for the nine months ended September 30, 2019 and 2018 in the total amount of $37
and $0 respectively included in general and administrative expenses.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">On August 12, 2019, the board of
directors approved a grant of 17,503 stock options to purchase an aggregate of up to 17,503 shares of common stock to certain of
its employees, at an exercise price per share of $5.95. The stock options vest over a period of 3 years as outlined in the option
agreements As a result, the Company recognized compensation expenses for the three months ended September 30, 2019 and 2018 in
the total amount of $4 and $0 respectively and for the nine months ended September 30, 2019 and 2018 in the total amount of $4
and $0 respectively included in general and administrative expenses.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">A summary of the Company’s
option activity related to options to employees and directors, and related information is as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="10" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">For the Nine Months ended September 30, 2019</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Number of</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">stock options</p></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Weighted average exercise price</font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Aggregate intrinsic value</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 50%"><font style="font: 10pt Times New Roman, Times, Serif">Outstanding at beginning of period</font></td>
<td style="width: 2%"> </td>
<td style="width: 1%"> </td>
<td style="width: 14%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">398,308</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 13%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">11.50</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 13%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">108</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Granted</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">29,133</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">7.00</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Exercised</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Cancelled</font></td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Outstanding at end of period</font></td>
<td> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">427,441</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 2.25pt double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">11.15</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 2.25pt double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">417</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Vested at end of period</font></td>
<td> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">306,723</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 2.25pt double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">9.90</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 2.25pt double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">417</font></td>
<td> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in"> </p>
<table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="10" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">For the Year ended December 31, 2018</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Number of</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">stock options</p></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Weighted average exercise price</font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Aggregate intrinsic value</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 50%"><font style="font: 10pt Times New Roman, Times, Serif">Outstanding at beginning of period</font></td>
<td style="width: 2%"> </td>
<td style="width: 1%"> </td>
<td style="width: 14%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">414,965</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 13%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">11.70</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 13%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,859</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Granted</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">10,000</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">9.00</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Exercised</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(2,487</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Cancelled</font></td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(24,170</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Outstanding at end of period</font></td>
<td> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">398,308</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 2.25pt double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">11.50</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 2.25pt double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">108</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Vested at end of period</font></td>
<td> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">245,010</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 2.25pt double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">8.45</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 2.25pt double"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">108</font></td>
<td> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in"> </p>
<p style="font: 1pt Times New Roman, Times, Serif; margin: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">The aggregate intrinsic value in
the table above represents the total intrinsic value, which is calculated as the difference between the fair market value of the
common stock and the exercise price, multiplied by the number of in-the-money stock options on those dates that would have been
received by the stock option holders had all stock option holders exercised their stock options on those dates as of September
30, 2019 and December 31, 2018 respectively.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">The stock options outstanding as
of September 30, 2019 and December 31, 2018, summarized by exercise prices, are as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Exercise price $</font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Stock options outstanding as of September 30, 2019</font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Stock options outstanding as of December 31, 2018</font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Weighted average remaining contractual life – years as of September 30, 2019</font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Weighted average remaining contractual life – years as of December 31, 2018</font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Stock options exercisable as of September 30, 2019</font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Stock options exercisable as of December 31, 2018</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom">
<td colspan="2"> </td>
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 1%"> </td>
<td style="width: 17%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">4.20</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 11%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">77,846</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 11%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">77,846</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 11%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">6.3</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 10%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">7.0</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 10%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">77,846</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 10%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">77,846</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">15.75</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">133,546</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">133,546</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">8.0</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">8.8</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">83,005</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">53,752</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">8.60</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">11,630</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">9.3</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">4,645</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">9.00</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">10,000</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">10,000</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">9.0</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">9.8</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">4,000</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">19.35</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">72,508</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">72,508</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">8.0</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">8.8</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">45,318</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">29,003</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">5.95</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">17,503</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.8</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">-</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">15.30</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">41,866</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">41,866</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">8.3</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">9.0</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">29,367</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">21,867</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">(*</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">62,542</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">62,542</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">7.0</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">7.8</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">62,542</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 1.5pt solid"> </td>
<td style="border-bottom: black 1.5pt solid; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">62,542</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td> </td>
<td style="text-align: right"> </td>
<td> </td>
<td> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">427,441</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">398,308</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">6.3</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">7.3</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">306,723</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 2.25pt double"> </td>
<td style="border-bottom: black 2.25pt double; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">245,010</font></td>
<td> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in"> </p>
<p style="font: 1pt Times New Roman, Times, Serif; margin: 0"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">(*) Less than $0.01.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">Compensation expense recorded by
the Company for its stock-based employee compensation awards in accordance with ASC 718-10 for the nine months ended September
30, 2019 and 2018 was $906 and $1,139, respectively, and for the three months ended September 30, 2019 and 2018 was $296 and $317,
respectively.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">The fair value of the stock options
is estimated at the date of grant using the Black-Scholes options pricing model with the following weighted-average assumptions:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Nine Months ended<br />
September 30, 2019</font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Year ended<br />
December 31, 2018</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 46%"><font style="font: 10pt Times New Roman, Times, Serif">Expected volatility</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 24%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">133.43%-144.4</font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">%</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 24%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">99.40</font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">%</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Risk-free interest</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1.64</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">%</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2.39</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">%</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Dividend yield</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">%</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">0</font></td>
<td><font style="font: 10pt Times New Roman, Times, Serif">%</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Expected life of up to (years)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">6.37-6.73</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">5.24</font></td>
<td> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b>Shares issued to service provider</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">On May 24, 2018 the Company issued
an aggregate of 6,738 nonrefundable shares (100,000 nonrefundable shares before the Reverse Split) of common stock to CardioSert
as part of certain patent acquisition. The Company recorded expenses of approximately $74 with respect to the issuance of these
shares included in research and development expenses.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b>Warrants</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">The remaining outstanding warrants
and terms as of September 30, 2019 and December 31, 2018 are as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Issuance date</font></td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Outstanding as of December 31, 2018</font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Outstanding as of September 30, 2019</font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Exercise Price</font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Exercisable as of September 30, 2019</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Exercisable Through</font></td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td>
<td> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 20%"><font style="font: 10pt Times New Roman, Times, Serif">Series A (2013)</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 15%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">181</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 15%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">181</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 8%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2,754.00</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 14%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">181</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 15%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">April 9, 2023</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Series A (2015)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">676</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">676</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,377.00</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">676</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">April 30, 2020</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Series B (2016) (a)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2,741</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2,741</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">40.50</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2,741</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">March 14, 2022</font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">Prior to January 1, 2019, warrants
with non-standard anti-dilution provisions (referred to as down round protection) were classified as liabilities and re-measured
each reporting period. On January 1, 2019, the Company adopted the provisions of ASU 2017-11, which indicates that a down round
feature no longer precludes equity classification when assessing whether an investment is indexed to an entity’s own stock.
The Company used a full retrospective approach to adoption and restated its financial statements as of the earliest period presented.
The cumulative effect of adoption of ASU 2017-11 resulted in an adjustment to accumulated deficit as of January 1, 2018 of $20
with a corresponding adjustment to additional paid-in capital.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b>Repurchase of Shares</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">The Company had intended to enter
into a definitive agreement with up to three Israeli shareholders, some of whom are directors of the Company, that were former
shareholders of Microbot Israel, pursuant to which the Company would repurchase, at a discount on the fair value of the share at
the date of repurchase, up to $500 of common stock held by them, in the aggregate, if and to the extent such shareholders are unable
to sell enough of their shares to cover certain of their Israeli tax liabilities resulting from the Merger. Such repurchase(s),
if any, would occur only after the two-year anniversary of the Merger. The transaction would have been subject to negotiating final
terms and entering into definitive agreements with such shareholders.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">The Company evaluated whether an
embedded derivative that requires bifurcation exists within such shares that may be subject to repurchase. The Company concluded
the fair value of such derivative instrument would be nominal and, in any case, would represent an asset to the Company as (a)
the settlement requires acquiring the shares at a discount on the fair market value of the share at the time of re purchase and
in no circumstances the acquisition price will be higher than approximately one dollar per share (representing 25% discount on
the fair market value of the share at the merger closing date) and (b) it is assumed that the selling shareholders would use such
right as last resort as such repurchase at a discount on the fair market value of such shares results in a loss to be incurred
by the selling shareholders.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">In accordance with ASC 480-10-S99-3A
(formerly EITF D-98), the Company classified the maximum amount it may be required to pay in the event the repurchase right is
exercised ($500) as temporary equity.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">As of December 31, 2018, the Company
determined that no obligation remained to enter into any such definitive agreement as the two-year anniversary of the Merger was
in November 2018 and therefore there was no liability for the Company to repurchase any shares from the three Israeli shareholders.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><b>Fair
Value of Financial Instruments:</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The
carrying values of cash and cash equivalents, other receivable and other accounts payable and accrued liabilities approximate
their fair value due to the short-term maturity of these instruments.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The
Company measures the fair value of certain of its financial instruments (marketable debt security) on a recurring basis.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">A
fair value hierarchy is used to rank the quality and reliability of the information used to determine fair values. Financial assets
and liabilities carried at fair value will be classified and disclosed in one of the following three categories:</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><b>Level
1 </b>- Quoted prices (unadjusted) in active markets for identical assets and liabilities.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><b>Level
2</b> - Inputs other than Level 1 that are observable, either directly or indirectly, such as unadjusted quoted prices for similar
assets and liabilities, unadjusted quoted prices in the markets that are not active, or other inputs that are observable or can
be corroborated by observable market data for substantially the full term of the assets or liabilities.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b>Level
3</b> - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the
assets or liabilities. </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><b>Recent
Accounting Standards:</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">In
June 2016, the FASB issued ASU 2016-13 “Financial Instruments – Credit Losses” to improve information on credit
losses for financial assets and net investment in leases that are not accounted for at fair value through net income. This ASU
replaces the current incurred loss impairment methodology with a methodology that reflects expected credit losses. This ASU is
effective for the Company in the first quarter of 2020, with early adoption permitted. The Company does not expect that this ASU
will have a material effect on the Company’s consolidated financial statements.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">In
August 2018, the FASB issued ASU 2018-13, “Changes to Disclosure Requirements for Fair Value Measurements”, which
will improve the effectiveness of disclosure requirements for recurring and nonrecurring fair value measurements. This ASU removes,
modifies, and adds certain disclosure requirements, and is effective for the Company beginning on January 1, 2020. The Company
does not expect that this ASU will have a material effect on the Company’s consolidated financial statements.<b> </b></p>
2503000
421000
314000
131000
-7000
61000
<p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0; text-align: center; margin-bottom: 0"></p>
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="font: 10pt Times New Roman, Times, Serif">
<td style="width: 0.7in; font: 10pt Times New Roman, Times, Serif; text-align: justify; vertical-align: top"><font style="font: 10pt Times New Roman, Times, Serif"><b>NOTE
4 - </b></font></td>
<td style="font: 10pt Times New Roman, Times, Serif; text-align: justify; vertical-align: top"><font style="font: 10pt Times New Roman, Times, Serif"><b>LEASES</b></font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">On
January 1, 2019, the Company adopted ASU 2016-02, Leases (Topic 842) (“ASU 2016-02”) using the modified retrospective
approach for all lease arrangements at the beginning period of adoption. Leases existing for the reporting period beginning January
1, 2019 are presented under ASU 2016-02. The Company leases office space and vehicles under operating leases. At September 30,
2019, the Company’s ROU assets and lease liabilities for operating leases totaled $421 and $445, respectively. The impact
of adopting the new lease standard was not material to the Company’s condensed consolidated statement of operations for
the periods presented.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Supplemental
cash flow information related to operating leases was as follows (unaudited):</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 65%; font: 10pt Times New Roman, Times, Serif; margin-left: 1in">
<tr style="vertical-align: bottom; font-family: Times New Roman, Times, Serif">
<td style="text-align: center; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1.5pt; text-align: center; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">Nine
Months ended September 30, 2019</font></td><td style="padding-bottom: 1.5pt; text-align: center; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; font-family: Times New Roman, Times, Serif">
<td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font-family: Times New Roman, Times, Serif">
<td style="width: 72%; text-align: left; padding-bottom: 2.5pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">Cash
payments for operating leases</font></td><td style="width: 2%; padding-bottom: 2.5pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; border-bottom: Black 2.5pt double; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">$</font></td><td style="width: 24%; border-bottom: Black 2.5pt double; text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">235</font></td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Leases
recorded on the balance sheet consist of the following (in thousands):</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 65%; font: 10pt Times New Roman, Times, Serif; margin-left: 1in">
<tr style="vertical-align: bottom; font-family: Times New Roman, Times, Serif">
<td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1.5pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">September
30, 2019</font></td><td style="padding-bottom: 1.5pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font-family: Times New Roman, Times, Serif">
<td style="font-weight: bold; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">Assets</font></td><td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font-family: Times New Roman, Times, Serif">
<td style="width: 72%; text-align: left; padding-left: 10pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">Operating
lease right of use asset</font></td><td style="width: 2%; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">$</font></td><td style="width: 24%; text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">421</font></td><td style="width: 1%; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font-family: Times New Roman, Times, Serif">
<td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font-family: Times New Roman, Times, Serif">
<td style="font-weight: bold; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">Liabilities</font></td><td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font-family: Times New Roman, Times, Serif">
<td style="text-align: left; padding-left: 10pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">Operating
lease – current</font></td><td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">$</font></td><td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">314</font></td><td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font-family: Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 1.5pt; padding-left: 10pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">Operating
lease - non-current</font></td><td style="padding-bottom: 1.5pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1.5pt solid; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 1.5pt solid; text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">131</font></td><td style="padding-bottom: 1.5pt; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font-family: Times New Roman, Times, Serif">
<td style="padding-bottom: 2.5pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 2.5pt double; text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">445</font></td><td style="padding-bottom: 2.5pt; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; font-family: Times New Roman, Times, Serif">
<td style="padding-bottom: 2.5pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; font-family: Times New Roman, Times, Serif">
<td style="text-align: center; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1.5pt; text-align: center; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">September
30, 2019</font></td><td style="padding-bottom: 1.5pt; text-align: center; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; font-family: Times New Roman, Times, Serif">
<td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="font-family: Times New Roman, Times, Serif"></td><td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font-family: Times New Roman, Times, Serif">
<td style="width: 72%; text-align: left; padding-left: 10pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">Operating
leases weighted average remaining lease term (in years)</font></td><td style="width: 2%; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="width: 24%; text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">2</font></td><td style="width: 1%; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font-family: Times New Roman, Times, Serif">
<td style="text-align: left; padding-left: 10pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">Operating
leases weighted average discount rate</font></td><td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">7</font></td><td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">%</font></td></tr></table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Undiscounted
maturities of operating lease payments as of September 30, 2019 are summarized as follows (in thousands):</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 65%; font: 10pt Times New Roman, Times, Serif; margin-left: 1in">
<tr style="vertical-align: bottom; font-family: Times New Roman, Times, Serif">
<td style="text-align: center; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1.5pt; text-align: center; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">Operating
Leases</font></td><td style="padding-bottom: 1.5pt; text-align: center; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; font-family: Times New Roman, Times, Serif">
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font-family: Times New Roman, Times, Serif">
<td style="width: 72%; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">Remainder
of 2019</font></td><td style="width: 2%; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">$</font></td><td style="width: 24%; text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">83</font></td><td style="width: 1%; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font-family: Times New Roman, Times, Serif">
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">2020</font></td><td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">302</font></td><td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font-family: Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 1.5pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">2021</font></td><td style="padding-bottom: 1.5pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1.5pt solid; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1.5pt solid; text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">79</font></td><td style="padding-bottom: 1.5pt; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font-family: Times New Roman, Times, Serif">
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">Total
future lease payments</font></td><td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">$</font></td><td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">464</font></td><td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font-family: Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 1.5pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">Less
imputed interest</font></td><td style="padding-bottom: 1.5pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1.5pt solid; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1.5pt solid; text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">(19</font></td><td style="padding-bottom: 1.5pt; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font-family: Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 2.5pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">Total
lease liability balance</font></td><td style="padding-bottom: 2.5pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 2.5pt double; text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">445</font></td><td style="padding-bottom: 2.5pt; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr></table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><b>Unaudited
Interim Financial Statements:</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The
accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with U.S. GAAP for
interim financial information and with the instructions to Form 10-Q and Article 10 of U.S. Securities and Exchange Commission
(“SEC”) regulations. Accordingly, they do not include all the information and footnotes required by GAAP for complete
financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included
(consisting only of normal recurring adjustments except as otherwise discussed).</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">Operating
results for the three- and nine-month periods ended September 30, 2019, are not necessarily indicative of the results that may
be expected for the year ended December 31, 2019. </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><b>Significant
Accounting Policies:</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">The
significant accounting policies followed in the preparation of these unaudited interim condensed consolidated financial statements
are identical to those applied in the preparation of the latest annual audited financial statements with the exception of the
following:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><b>Leases:</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">In
February 2016, the Financial Accounting Standards Board (“FASB”) issued ASU 2016-02, Leases (Topic 842). This ASU
requires entities that lease assets to recognize on the balance sheet the assets and liabilities for the rights and obligations
created by leases with lease terms of more than 12 months. The Company adopted this ASU effective January 1, 2019 using the modified
retrospective application, applying the new standard to leases in place as of the adoption date. Prior periods have not been adjusted.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">Arrangements
that are determined to be leases at inception are recognized as long-term right-of-use assets (“ROU”) and lease liabilities
in the condensed consolidated balance sheet at lease commencement. Operating lease ROU assets and operating lease liabilities
are recognized based on the present value of the future fixed lease payments over the lease term at commencement date. As most
of the Company’s leases do not provide an implicit rate, the Company applies its incremental borrowing rate based on the
economic environment at commencement date in determining the present value of future payments. Lease terms may include options
to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for operating
leases or payments are recognized on a straight-line basis over the lease term.</p>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b>Warrants:</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">Prior to January 1, 2019, warrants
with non-standard anti-dilution provisions (referred to as down round protection) were classified as liabilities and re-measured
each reporting period. On January 1, 2019, the Company adopted the provisions of Accounting Standards Update (“ASU”)
2017-11, which includes Part I “Accounting for Certain Financial Instruments with Down Round Features” and Part II
“Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and
Certain Mandatorily Redeemable Non-Controlling Interests with a Scope Exception”, which indicates that a down round feature
no longer precludes equity classification when assessing whether an investment is indexed to an entity’s own stock. The Company
used a full retrospective approach to adoption and restated its financial statements as of the earliest period presented. As a
result of the adoption of ASU 2017-11, the Company’s warrants were reclassified from liabilities to shareholders’ equity.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">The cumulative effect of adoption
of ASU 2017-11 resulted as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"> </p>
<table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">For the<br />
Nine Months ended<br />
September 30, 2018</font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">For the<br />
year ended<br />
December 31 2018</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 41%"><font style="font: 10pt Times New Roman, Times, Serif">Derivative warrant liability</font></td>
<td style="width: 2%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 27%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">           (5</font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 25%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">          (8)</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Additional paid-in capital</font></td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">3</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">28</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Accumulated deficit</font></td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">20</font></td>
<td> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"> </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">Refer to Note 6 for further information
regarding the outstanding warrants as of September 30, 2019.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The
following table summarizes the Company’s marketable debt securities as of September 30, 2019 and December 31, 2018.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><b></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"><font style="font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt"><b> </b></font></font></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 70%; font: 10pt Times New Roman, Times, Serif; margin-left: 0.7in">
<tr style="vertical-align: bottom">
<td> </td><td style="padding-bottom: 1.5pt"> </td>
<td colspan="14" style="text-align: center; border-bottom: Black 1.5pt solid">As of September 30, 2019</td><td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td><td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="text-align: center; border-bottom: Black 1.5pt solid">Amortized cost</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="text-align: center; border-bottom: Black 1.5pt solid">Unrealized gains</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="text-align: center; border-bottom: Black 1.5pt solid">Realized gains</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="text-align: center; border-bottom: Black 1.5pt solid"><p style="margin-top: 0; margin-bottom: 0">Fair</p>
<p style="margin-top: 0; margin-bottom: 0">value</p></td><td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td><td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="text-align: center; padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="text-align: center; padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="text-align: center; padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="text-align: center; padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="width: 44%; text-align: left; padding-bottom: 2.5pt">US Treasury Bond</td><td style="width: 2%; padding-bottom: 2.5pt"> </td>
<td style="width: 1%; border-bottom: Black 2.5pt double; text-align: left">$</td><td style="width: 10%; border-bottom: Black 2.5pt double; text-align: right">2,503</td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left"> </td><td style="width: 2%; padding-bottom: 2.5pt"> </td>
<td style="width: 1%; border-bottom: Black 2.5pt double; text-align: left">$</td><td style="width: 10%; border-bottom: Black 2.5pt double; text-align: right">        -</td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left"> </td><td style="width: 2%; padding-bottom: 2.5pt"> </td>
<td style="width: 1%; border-bottom: Black 2.5pt double; text-align: left">$</td><td style="width: 10%; border-bottom: Black 2.5pt double; text-align: right">       -</td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left"> </td><td style="width: 2%; padding-bottom: 2.5pt"> </td>
<td style="width: 1%; border-bottom: Black 2.5pt double; text-align: left">$</td><td style="width: 10%; border-bottom: Black 2.5pt double; text-align: right">2,503</td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"><font style="font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt"><b> </b></font></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"><font style="font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt"><b></b></font></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"><font style="font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt"><b></b></font></font></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 70%; font: 10pt Times New Roman, Times, Serif; margin-left: 0.7in">
<tr style="vertical-align: bottom">
<td style="font-size: 11pt; padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td>
<td style="text-align: left; padding-bottom: 1.5pt"> </td><td colspan="13" style="text-align: center; border-bottom: Black 1.5pt solid"><font style="font: 10pt Times New Roman, Times, Serif">As of December 31, 2018</font> <p style="margin-top: 0; margin-bottom: 0"></p>
<p style="margin-top: 0; margin-bottom: 0"></p>
</td><td style="text-align: left; padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom">
<td style="font-size: 11pt; text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td>
<td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; border-bottom: Black 1.5pt solid"><font style="font: 10pt Times New Roman, Times, Serif">Amortized Cost</font></td><td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td>
<td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; border-bottom: Black 1.5pt solid"><font style="font: 10pt Times New Roman, Times, Serif">Unrealized gains</font></td><td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td>
<td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; border-bottom: Black 1.5pt solid"><font style="font: 10pt Times New Roman, Times, Serif">Realized gains</font></td><td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td>
<td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; border-bottom: Black 1.5pt solid"><font style="font: 10pt Times New Roman, Times, Serif">Fair value</font></td><td style="text-align: center; padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom">
<td style="font-size: 11pt; text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td>
<td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td>
<td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td>
<td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td>
<td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="width: 44%; text-align: left; padding-bottom: 2.5pt">US Treasury Bond</td><td style="width: 2%; padding-bottom: 2.5pt"> </td>
<td style="width: 1%; text-align: left; border-bottom: Black 2.5pt double">$</td><td style="width: 10%; text-align: right; border-bottom: Black 2.5pt double">-</td><td style="width: 1%; text-align: left; padding-bottom: 2.5pt"> </td><td style="width: 2%; padding-bottom: 2.5pt"> </td>
<td style="width: 1%; text-align: left; border-bottom: Black 2.5pt double">$</td><td style="width: 10%; text-align: right; border-bottom: Black 2.5pt double">-</td><td style="width: 1%; text-align: left; padding-bottom: 2.5pt"> </td><td style="width: 2%; padding-bottom: 2.5pt"> </td>
<td style="width: 1%; text-align: left; border-bottom: Black 2.5pt double">$</td><td style="width: 10%; text-align: right; border-bottom: Black 2.5pt double">-</td><td style="width: 1%; text-align: left; padding-bottom: 2.5pt"> </td><td style="width: 2%; padding-bottom: 2.5pt"> </td>
<td style="width: 1%; text-align: left; border-bottom: Black 2.5pt double">$</td><td style="width: 10%; text-align: right; border-bottom: Black 2.5pt double">-</td><td style="width: 1%; text-align: left; padding-bottom: 2.5pt"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"><font style="font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt"><b></b></font></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><b> </b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Supplemental
cash flow information related to operating leases was as follows (unaudited):</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 65%; font: 10pt Times New Roman, Times, Serif; margin-left: 1in">
<tr style="vertical-align: bottom; font-family: Times New Roman, Times, Serif">
<td style="text-align: center; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1.5pt; text-align: center; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">Nine
Months ended September 30, 2019</font></td><td style="padding-bottom: 1.5pt; text-align: center; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; font-family: Times New Roman, Times, Serif">
<td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font-family: Times New Roman, Times, Serif">
<td style="width: 72%; text-align: left; padding-bottom: 2.5pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">Cash
payments for operating leases</font></td><td style="width: 2%; padding-bottom: 2.5pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; border-bottom: Black 2.5pt double; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">$</font></td><td style="width: 24%; border-bottom: Black 2.5pt double; text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">235</font></td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr></table>
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">The remaining outstanding warrants
and terms as of September 30, 2019 and December 31, 2018 are as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Issuance date</font></td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Outstanding as of December 31, 2018</font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Outstanding as of September 30, 2019</font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Exercise Price</font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Exercisable as of September 30, 2019</font></td>
<td> </td>
<td> </td>
<td style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">Exercisable Through</font></td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td>
<td> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 20%"><font style="font: 10pt Times New Roman, Times, Serif">Series A (2013)</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 15%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">181</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 15%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">181</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 8%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2,754.00</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 14%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">181</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 15%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">April 9, 2023</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Series A (2015)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">676</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">676</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">1,377.00</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">676</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">April 30, 2020</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Series B (2016) (a)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2,741</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2,741</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">40.50</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2,741</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">March 14, 2022</font></td></tr>
</table>
<p style="margin: 0pt"></p>
2496000
630000
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"><tr style="font: 10pt Times New Roman, Times, Serif"><td style="width: 0.7in; font: 10pt Times New Roman, Times, Serif; text-align: justify; vertical-align: top"><font style="font: 10pt Times New Roman, Times, Serif"><b>NOTE
3 -</b></font></td>
<td style="font: 10pt Times New Roman, Times, Serif; text-align: justify; vertical-align: top"><font style="font: 10pt Times New Roman, Times, Serif"><b>
SHORT-TERM INVESTMENTS</b></font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The
following table summarizes the Company’s marketable debt securities as of September 30, 2019 and December 31, 2018.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><b></b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"><font style="font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt"><b> </b></font></font></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 70%; font: 10pt Times New Roman, Times, Serif; margin-left: 0.7in">
<tr style="vertical-align: bottom">
<td> </td><td style="padding-bottom: 1.5pt"> </td>
<td colspan="14" style="text-align: center; border-bottom: Black 1.5pt solid">As of September 30, 2019</td><td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td><td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="text-align: center; border-bottom: Black 1.5pt solid">Amortized cost</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="text-align: center; border-bottom: Black 1.5pt solid">Unrealized gains</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="text-align: center; border-bottom: Black 1.5pt solid">Realized gains</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="text-align: center; border-bottom: Black 1.5pt solid"><p style="margin-top: 0; margin-bottom: 0">Fair</p>
<p style="margin-top: 0; margin-bottom: 0">value</p></td><td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td><td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="text-align: center; padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="text-align: center; padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="text-align: center; padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="text-align: center; padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="width: 44%; text-align: left; padding-bottom: 2.5pt">US Treasury Bond</td><td style="width: 2%; padding-bottom: 2.5pt"> </td>
<td style="width: 1%; border-bottom: Black 2.5pt double; text-align: left">$</td><td style="width: 10%; border-bottom: Black 2.5pt double; text-align: right">2,503</td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left"> </td><td style="width: 2%; padding-bottom: 2.5pt"> </td>
<td style="width: 1%; border-bottom: Black 2.5pt double; text-align: left">$</td><td style="width: 10%; border-bottom: Black 2.5pt double; text-align: right">        -</td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left"> </td><td style="width: 2%; padding-bottom: 2.5pt"> </td>
<td style="width: 1%; border-bottom: Black 2.5pt double; text-align: left">$</td><td style="width: 10%; border-bottom: Black 2.5pt double; text-align: right">       -</td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left"> </td><td style="width: 2%; padding-bottom: 2.5pt"> </td>
<td style="width: 1%; border-bottom: Black 2.5pt double; text-align: left">$</td><td style="width: 10%; border-bottom: Black 2.5pt double; text-align: right">2,503</td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"><font style="font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt"><b> </b></font></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"><font style="font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt"><b></b></font></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"><font style="font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt"><b></b></font></font></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 70%; font: 10pt Times New Roman, Times, Serif; margin-left: 0.7in">
<tr style="vertical-align: bottom">
<td style="font-size: 11pt; padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td>
<td style="text-align: left; padding-bottom: 1.5pt"> </td><td colspan="13" style="text-align: center; border-bottom: Black 1.5pt solid"><font style="font: 10pt Times New Roman, Times, Serif">As of December 31, 2018</font> <p style="margin-top: 0; margin-bottom: 0"></p>
<p style="margin-top: 0; margin-bottom: 0"></p>
</td><td style="text-align: left; padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom">
<td style="font-size: 11pt; text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td>
<td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; border-bottom: Black 1.5pt solid"><font style="font: 10pt Times New Roman, Times, Serif">Amortized Cost</font></td><td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td>
<td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; border-bottom: Black 1.5pt solid"><font style="font: 10pt Times New Roman, Times, Serif">Unrealized gains</font></td><td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td>
<td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; border-bottom: Black 1.5pt solid"><font style="font: 10pt Times New Roman, Times, Serif">Realized gains</font></td><td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td>
<td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; border-bottom: Black 1.5pt solid"><font style="font: 10pt Times New Roman, Times, Serif">Fair value</font></td><td style="text-align: center; padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom">
<td style="font-size: 11pt; text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td>
<td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td>
<td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td>
<td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td>
<td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="width: 44%; text-align: left; padding-bottom: 2.5pt">US Treasury Bond</td><td style="width: 2%; padding-bottom: 2.5pt"> </td>
<td style="width: 1%; text-align: left; border-bottom: Black 2.5pt double">$</td><td style="width: 10%; text-align: right; border-bottom: Black 2.5pt double">-</td><td style="width: 1%; text-align: left; padding-bottom: 2.5pt"> </td><td style="width: 2%; padding-bottom: 2.5pt"> </td>
<td style="width: 1%; text-align: left; border-bottom: Black 2.5pt double">$</td><td style="width: 10%; text-align: right; border-bottom: Black 2.5pt double">-</td><td style="width: 1%; text-align: left; padding-bottom: 2.5pt"> </td><td style="width: 2%; padding-bottom: 2.5pt"> </td>
<td style="width: 1%; text-align: left; border-bottom: Black 2.5pt double">$</td><td style="width: 10%; text-align: right; border-bottom: Black 2.5pt double">-</td><td style="width: 1%; text-align: left; padding-bottom: 2.5pt"> </td><td style="width: 2%; padding-bottom: 2.5pt"> </td>
<td style="width: 1%; text-align: left; border-bottom: Black 2.5pt double">$</td><td style="width: 10%; text-align: right; border-bottom: Black 2.5pt double">-</td><td style="width: 1%; text-align: left; padding-bottom: 2.5pt"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"><font style="font-family: Times New Roman, Times, Serif"><font style="font-size: 10pt"><b></b></font></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><b> </b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The
Company’s financial asset is measured at fair value on a recurring basis by level within the fair value hierarchy. The Company’s
marketable security is classified as Level 1. Other than the marketable debt security, the Company doesn’t have any other
financial assets or financial liabilities marked to market at fair value.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">The
contractual maturity of the marketable security is one year.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><b>Short-term
Investments:</b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><b> </b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">The
Company began investing excess cash in short-term investments during the first quarter of 2019.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Marketable
debt securities are considered to be available for sale and are carried at fair value. Unrealized gains and losses net of tax,
if any, are reported as a separate component of shareholders’ equity. The cost of marketable debt securities classified
as available for sale is adjusted for amortization of premiums and accretion of discounts to maturity. Such amortization and accretion
are included in interest income. Realized gains and losses and declines in value judged to be other than temporary, if any, are
also included in other income, net. Interest on securities classified as available for sale is included in interest income. The
cost of securities sold is based on the specific identification method.</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">Management
evaluates whether available-for-sale securities are other-than-temporarily impaired (OTTI) on a quarterly basis. Debt securities
with unrealized losses are considered OTTI if the Company intends to sell the security or if it is more likely than not that the
Company will be required to sell such security prior to any anticipated recovery. If management determines that a security is
OTTI under these circumstances, the impairment recognized in earnings is measured as the entire difference between the amortized
cost and the then-current fair value. During the three and nine-months ended September 30, 2019, no investment OTTI losses were
realized.<b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify; text-indent: 0in"><font style="font: 10pt Times New Roman, Times, Serif">A
summary of the Company’s option activity related to options to employees and directors, and related information is as follows:</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: left; margin-left: 0.5in"></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 75%; font: 10pt Times New Roman, Times, Serif; margin-left: 1in">
<tr style="vertical-align: bottom">
<td> </td><td style="padding-bottom: 1.5pt"> </td>
<td colspan="10" style="text-align: center; border-bottom: Black 1.5pt solid">For the Nine months ended September 30, 2019</td><td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td><td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="text-align: center; border-bottom: Black 1.5pt solid"><p style="margin-top: 0; margin-bottom: 0">Number of</p>
<p style="margin-top: 0; margin-bottom: 0">stock options</p></td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="text-align: center; border-bottom: Black 1.5pt solid">Weighted average exercise price</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="text-align: center; border-bottom: Black 1.5pt solid">Aggregate intrinsic value</td><td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td><td> </td>
<td colspan="2"> </td><td> </td><td> </td>
<td colspan="2"> </td><td> </td><td> </td>
<td colspan="2"> </td><td> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="width: 46%">Outstanding at beginning of period</td><td style="width: 2%"> </td>
<td style="width: 1%; text-align: left"> </td><td style="width: 14%; text-align: right">398,308</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 14%; text-align: right">11.50</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 14%; text-align: right">108</td><td style="width: 1%; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td>Granted</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">29,133</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">7.00</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">-</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td>Exercised</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">-</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">-</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">-</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-bottom: 1.5pt">Cancelled</td><td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">-</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">-</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">-</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-bottom: 2.5pt">Outstanding at end of period</td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">427,441</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">11.15</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">417</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-bottom: 2.5pt">Vested at end of period</td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">306,723</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">9.90</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">417</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: left; margin-left: 0.5in"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: left; margin-left: 0.5in"><font style="font-family: Times New Roman, Times, Serif"> </font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: left; margin-left: 0.5in"><font style="font-family: Times New Roman, Times, Serif"></font></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 75%; font: 10pt Times New Roman, Times, Serif; margin-left: 1in">
<tr style="vertical-align: bottom">
<td> </td><td style="padding-bottom: 1.5pt"> </td>
<td colspan="10" style="text-align: center; border-bottom: Black 1.5pt solid">For the Year ended December 31, 2018</td><td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td><td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="text-align: center; border-bottom: Black 1.5pt solid"><p style="margin-top: 0; margin-bottom: 0">Number of</p>
<p style="margin-top: 0; margin-bottom: 0">stock options</p></td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="text-align: center; border-bottom: Black 1.5pt solid">Weighted average exercise price</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="text-align: center; border-bottom: Black 1.5pt solid">Aggregate intrinsic value</td><td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td><td> </td>
<td colspan="2"> </td><td> </td><td> </td>
<td colspan="2"> </td><td> </td><td> </td>
<td colspan="2"> </td><td> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="width: 46%">Outstanding at beginning of period</td><td style="width: 2%"> </td>
<td style="width: 1%; text-align: left"> </td><td style="width: 14%; text-align: right">414,965</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 14%; text-align: right">11.70</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td>
<td style="width: 1%; text-align: left">$</td><td style="width: 14%; text-align: right">1,859</td><td style="width: 1%; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td>Granted</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">10,000</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">9.00</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">-</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td>Exercised</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">(2,487</td><td style="text-align: left">)</td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">-</td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right">-</td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="padding-bottom: 1.5pt">Cancelled</td><td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">(24,170</td><td style="padding-bottom: 1.5pt; text-align: left">)</td><td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">-</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td>
<td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">-</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-bottom: 2.5pt">Outstanding at end of period</td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">398,308</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">11.50</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">108</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: White">
<td> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td>
<td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255)">
<td style="padding-bottom: 2.5pt">Vested at end of period</td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">245,010</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">8.45</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td>
<td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">108</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; text-align: left; margin-left: 0.5in"> </p>
-5377000
-5134000
-1874000
-1758000
-125000
-83000
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">The cumulative effect of adoption
of ASU 2017-11 resulted as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"> </p>
<table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">For the<br />
Nine Months ended<br />
September 30, 2018</font></td>
<td> </td>
<td> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font: 10pt Times New Roman, Times, Serif">For the<br />
year ended<br />
December 31 2018</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 41%"><font style="font: 10pt Times New Roman, Times, Serif">Derivative warrant liability</font></td>
<td style="width: 2%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 27%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">           (5</font></td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">)</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="width: 25%; text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">          (8)</font></td>
<td style="width: 1%"> </td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font: 10pt Times New Roman, Times, Serif">Additional paid-in capital</font></td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">3</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">28</font></td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font: 10pt Times New Roman, Times, Serif">Accumulated deficit</font></td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">2</font></td>
<td> </td>
<td> </td>
<td><font style="font: 10pt Times New Roman, Times, Serif">$</font></td>
<td style="text-align: right"><font style="font: 10pt Times New Roman, Times, Serif">20</font></td>
<td> </td></tr>
</table>
<p style="margin: 0pt"></p>
2019
Yes
Yes
false
44000
49000
-364000
32000
186000
568000
3553000
3375000
<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"><tr style="font: 10pt Times New Roman, Times, Serif"><td style="width: 0.7in; font: 10pt Times New Roman, Times, Serif; text-align: justify; vertical-align: top"><font style="font: 10pt Times New Roman, Times, Serif"><b>NOTE
7 -</b></font></td>
<td style="font: 10pt Times New Roman, Times, Serif; text-align: justify; vertical-align: top"><font style="font: 10pt Times New Roman, Times, Serif"><b>SUBSEQUENT
EVENTS</b></font></td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif"><b> </b></font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">On
October 23, 2019, the board of directors approved a grant of options to purchase an aggregate of up to 19,760 shares of common
stock to the Company’s non-management directors, at an exercise price per share of $5.06. The stock options vest over a
period of 3 years as outlined in the option agreements.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Leases
recorded on the balance sheet consist of the following (in thousands):</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 65%; font: 10pt Times New Roman, Times, Serif; margin-left: 1in">
<tr style="vertical-align: bottom; font-family: Times New Roman, Times, Serif">
<td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1.5pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">September
30, 2019</font></td><td style="padding-bottom: 1.5pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font-family: Times New Roman, Times, Serif">
<td style="font-weight: bold; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">Assets</font></td><td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font-family: Times New Roman, Times, Serif">
<td style="width: 72%; text-align: left; padding-left: 10pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">Operating
lease right of use asset</font></td><td style="width: 2%; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">$</font></td><td style="width: 24%; text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">421</font></td><td style="width: 1%; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font-family: Times New Roman, Times, Serif">
<td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font-family: Times New Roman, Times, Serif">
<td style="font-weight: bold; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">Liabilities</font></td><td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font-family: Times New Roman, Times, Serif">
<td style="text-align: left; padding-left: 10pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">Operating
lease – current</font></td><td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">$</font></td><td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">314</font></td><td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font-family: Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 1.5pt; padding-left: 10pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">Operating
lease - non-current</font></td><td style="padding-bottom: 1.5pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1.5pt solid; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 1.5pt solid; text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">131</font></td><td style="padding-bottom: 1.5pt; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font-family: Times New Roman, Times, Serif">
<td style="padding-bottom: 2.5pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 2.5pt double; text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">445</font></td><td style="padding-bottom: 2.5pt; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; font-family: Times New Roman, Times, Serif">
<td style="padding-bottom: 2.5pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 2.5pt; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; font-family: Times New Roman, Times, Serif">
<td style="text-align: center; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1.5pt; text-align: center; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">September
30, 2019</font></td><td style="padding-bottom: 1.5pt; text-align: center; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; font-family: Times New Roman, Times, Serif">
<td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="font-family: Times New Roman, Times, Serif"></td><td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font-family: Times New Roman, Times, Serif">
<td style="width: 72%; text-align: left; padding-left: 10pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">Operating
leases weighted average remaining lease term (in years)</font></td><td style="width: 2%; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="width: 24%; text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">2</font></td><td style="width: 1%; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font-family: Times New Roman, Times, Serif">
<td style="text-align: left; padding-left: 10pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">Operating
leases weighted average discount rate</font></td><td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">7</font></td><td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">%</font></td></tr></table>
15
20000
-5000
-8000
3000
28000
2000
20000
2503000
2503000
445000
235000
83000
302000
79000
464000
19000
P2Y
0.07
1500000
0.035
0.03
0.015
0.03
248000
130000
213000
3375000
4200000
3375000
1000000
178000
0.10
50000
250000
6738
6738
100000
100000
74000
2000000
1.00
40000
61000000
221000000
655962
9735925
9736
47163
252652
700000
3750000
330000
590000
250000
74.00
40.50
5.00
2.70
6.50
10.00
9.875
210000
922000
125323
181
676
2741
6.49
2754
1377
40.50
2754
1377
40.50
3000000
5900000
2470000
29133
26906
120848
72508
33333
12698
66036
12698
403592
500000
1812712
1087627
190475
66036
990543
10000
11630
11630
10000
150000
17503
17503
19760
77846
96482
7.00
12.00
15.75
19.35
20.25
15.75
0.80
1.35
1.05
1.29
1.05
15.3
1.02
9.00
8.60
9
0.6
5.95
5.06
4.20
7.05
P5Y
P3Y
P3Y
P3Y
P3Y
P3Y
P3Y
P3Y
P3Y
906000
55000
460000
1139000
362000
40000
37000
296000
317000
122000
121000
13000
14000
0
7000
0
108000
98000
322000
329000
6000
22000
24000
22000
37000
62000
116000
273000
4000
0
4000
0
74000
500000
0.25
500000
427441
398308
414965
24170
306723
245010
11.15
11.50
11.70
9.90
8.45
417000
108000
1859000
417000
108000
4.20
15.75
4.20
15.75
8.60
8.60
9.00
9.00
19.35
19.35
5.95
5.95
15.30
15.30
427441
398308
77846
133546
77846
133546
11630
10000
10000
72508
72508
17503
41866
41866
62542
62542
P6Y3M19D
P6Y3M19D
P8Y
P7Y
P8Y9M18D
P9Y3M19D
P0Y
P9Y
P9Y9M18D
P8Y
P8Y9M18D
P0Y
P2Y9M18D
P7Y3M19D
P8Y3M19D
P9Y
P7Y
P7Y9M18D
306723
245010
77846
83005
77846
53752
4645
4000
45318
29003
29367
21867
62542
62542
1.3343
1.444
0.0164
0.0239
0.00
0.00
P5Y2M27D
P6Y4M13D
P6Y8M23D
181
676
2741
181
676
2741
April 9, 2023
April 30, 2020
March 14, 2022
April 9, 2023
April 30, 2020
March 14, 2022
<p style="margin: 0pt"></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify">The fair value of the stock options
is estimated at the date of grant using the Black-Scholes options pricing model with the following weighted-average assumptions:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"> </p>
<table cellspacing="0" cellpadding="0" style="font: 12pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
<td> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Nine Months ended<br />
September 30, 2019</font></td>
<td style="padding-bottom: 1.5pt"> </td>
<td style="padding-bottom: 1.5pt"> </td>
<td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center"><font style="font-size: 10pt">Year ended<br />
December 31, 2018</font></td>
<td style="padding-bottom: 1.5pt"> </td></tr>
<tr style="vertical-align: bottom">
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td>
<td> </td>
<td colspan="2"> </td>
<td> </td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td style="width: 44%"><font style="font-size: 10pt">Expected volatility</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 25%; text-align: right"><font style="font-size: 10pt">133.43%-144.4</font></td>
<td style="width: 1%"><font style="font-size: 10pt">%</font></td>
<td style="width: 1%"> </td>
<td style="width: 1%"> </td>
<td style="width: 25%; text-align: right"><font style="font-size: 10pt">99.40</font></td>
<td style="width: 1%"><font style="font-size: 10pt">%</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Risk-free interest</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">1.64</font></td>
<td><font style="font-size: 10pt">%</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">2.39</font></td>
<td><font style="font-size: 10pt">%</font></td></tr>
<tr style="vertical-align: bottom; background-color: #CCEEFF">
<td><font style="font-size: 10pt">Dividend yield</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">0</font></td>
<td><font style="font-size: 10pt">%</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">0</font></td>
<td><font style="font-size: 10pt">%</font></td></tr>
<tr style="vertical-align: bottom; background-color: white">
<td><font style="font-size: 10pt">Expected life of up to (years)</font></td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">6.37-6.73</font></td>
<td> </td>
<td> </td>
<td> </td>
<td style="text-align: right"><font style="font-size: 10pt">5.24</font></td>
<td> </td></tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify"></p>
0.9940
74000
7798000
5263000
6700000
10814000
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><b>Reclassifications:<br />
<br />
</b>Certain prior period amounts have been reclassified to conform to current period presentation.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in; text-align: justify"><font style="font: 10pt Times New Roman, Times, Serif">Undiscounted
maturities of operating lease payments as of September 30, 2019 are summarized as follows (in thousands):</font></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.7in"><font style="font: 10pt Times New Roman, Times, Serif"> </font></p>
<table cellpadding="0" cellspacing="0" style="border-collapse: collapse; width: 65%; font: 10pt Times New Roman, Times, Serif; margin-left: 1in">
<tr style="vertical-align: bottom; font-family: Times New Roman, Times, Serif">
<td style="text-align: center; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="padding-bottom: 1.5pt; text-align: center; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">Operating
Leases</font></td><td style="padding-bottom: 1.5pt; text-align: center; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; font-family: Times New Roman, Times, Serif">
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td colspan="2" style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font-family: Times New Roman, Times, Serif">
<td style="width: 72%; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">Remainder
of 2019</font></td><td style="width: 2%; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="width: 1%; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">$</font></td><td style="width: 24%; text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">83</font></td><td style="width: 1%; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font-family: Times New Roman, Times, Serif">
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">2020</font></td><td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">302</font></td><td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font-family: Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 1.5pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">2021</font></td><td style="padding-bottom: 1.5pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1.5pt solid; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1.5pt solid; text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">79</font></td><td style="padding-bottom: 1.5pt; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font-family: Times New Roman, Times, Serif">
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">Total
future lease payments</font></td><td style="font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">$</font></td><td style="text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">464</font></td><td style="text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr>
<tr style="vertical-align: bottom; background-color: rgb(204,238,255); font-family: Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 1.5pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">Less
imputed interest</font></td><td style="padding-bottom: 1.5pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 1.5pt solid; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td><td style="border-bottom: Black 1.5pt solid; text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">(19</font></td><td style="padding-bottom: 1.5pt; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">)</font></td></tr>
<tr style="vertical-align: bottom; background-color: White; font-family: Times New Roman, Times, Serif">
<td style="text-align: left; padding-bottom: 2.5pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">Total
lease liability balance</font></td><td style="padding-bottom: 2.5pt; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td>
<td style="border-bottom: Black 2.5pt double; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">$</font></td><td style="border-bottom: Black 2.5pt double; text-align: right; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif">445</font></td><td style="padding-bottom: 2.5pt; text-align: left; font-family: Times New Roman, Times, Serif"><font style="font-family: Times New Roman, Times, Serif"> </font></td></tr></table>
1:15 reverse stock split
4001
550
1001
2945677
906000
1139000
296000
317000
74000
-3451
-451
9544000
721107
480000
Less than 1
Includes 721,107 common stock classified as temporary equity as of December 31, 2017.
Refer to Note 5 for further information
Represents amount less than 1 thousand.
Refer to Note 4 for further information
The Company adopted ASU 2017-11 using the full retrospective approach. Refer to Note 6 for further information.
Share data as of December 31, 2017, June 30, 2018, and for the periods then ended represent the number of shares adjusted to retroactively reflect the 1:15 reverse stock split effected on September 4, 2018. Refer to Note 1 for further information.
Reclassified
Less than $0.01.