Filed
Pursuant to Rule 424(b)(5)
Registration
No. 333-239965
PROSPECTUS
SUPPLEMENT
(To
prospectus dated August 11, 2020)
1,794,783
Shares
NanoVibronix,
Inc.
We
are offering 1,794,783 shares of our common stock pursuant to this prospectus supplement and accompanying prospectus. Each share
of common stock is being sold at a price per share equal to $1.00.
Our
common stock is traded on The Nasdaq Capital Market, or Nasdaq, under the symbol “NAOV.” On September 21, 2020, the
closing sale price of our common stock on Nasdaq was $0.59 per share.
As
of the date of this prospectus supplement, the aggregate market value of our outstanding shares of common stock held by non-affiliates
was $16,390,692.86, based on 10,568,088 outstanding shares of common stock, of which 10,453,248 shares were held by non-affiliates,
and a price of $1.568 per share, which was the last reported sale price of our common stock on Nasdaq on July 27, 2020. Pursuant
to General Instruction I.B.6. of Form S-3, in no event will we sell the securities covered hereby in a public primary offering
with a value exceeding more than one-third of the aggregate market value of our common stock in any 12-month period so long as
the aggregate market value of our outstanding common stock held by non-affiliates remains below $75 million. During the 12 calendar
months prior to and including the date of this prospectus supplement, we have offered and sold $3,398,575.50 of shares of common
stock pursuant to General Instruction I.B.6. of Form S-3 (excluding the value of the shares of common stock sold in this offering).
We
are an “emerging growth company” as that term is used in the Jumpstart Our Business Startups Act of 2012, or the JOBS
Act, and, as such, have elected to comply with certain reduced public company reporting requirements for this prospectus supplement,
the accompanying prospectus and our filings with the Securities and Exchange Commission.
This
investment involves a high degree of risk. See “Risk Factors” on page S-5 of this prospectus
supplement and any similar section contained in the accompanying prospectus and in the documents that are incorporated by reference
herein and therein.
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Per
Share
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Total
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Public Offering price
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$
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1.000
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$
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1,794,783.00
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Underwriting discounts and commissions(1)
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$
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0.075
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$
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134,608.73
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Proceeds to us, before expenses
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$
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0.925
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$
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1,660,174.27
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(1)
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In
addition, we have agreed to reimburse the representative of the underwriters for certain offering-related expenses, including
a management fee of 1% of the gross proceeds raised in this offering, and to issue to the representative of the underwriters
or its designees warrants to purchase a number of shares of common stock equal to 7.5% of the shares of common stock sold
in this offering. See the section of this prospectus supplement entitled “Underwriting” for a description of the
compensation payable to the underwriters.
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We
have granted the underwriters a 30-day option to purchase up to an additional 269,217 shares of our common stock from us at the
public offering price per share, less underwriting discounts and commissions. If the underwriters exercise their option in full,
the total underwriting discounts and commissions payable by us will be $154,800.00, and the total proceeds to us, before expenses,
will be $1,909,200.00.
The
underwriters expect to deliver the shares of common stock on or about September 25, 2020.
Neither
the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or
passed upon the adequacy or accuracy of this prospectus supplement. Any representation to the contrary is a criminal offense.
H.C.
Wainwright & Co.
The
date of this prospectus supplement is September 22, 2020.
TABLE
OF CONTENTS
ABOUT
THIS PROSPECTUS SUPPLEMENT
This
document is part of the registration statement that we filed with the Securities and Exchange Commission, or the SEC, using a
“shelf” registration process and consists of two parts. The first part is this prospectus supplement, including the
documents incorporated by reference, which describes the specific terms of this offering. The second part, the accompanying prospectus,
including the documents incorporated by reference, gives more general information, some of which may not apply to this offering.
Generally, when we refer only to the “prospectus,” we are referring to both parts combined. This prospectus supplement
may add to, update or change information in the accompanying prospectus and the documents incorporated by reference into this
prospectus supplement or the accompanying prospectus.
If
information in this prospectus supplement is inconsistent with the accompanying prospectus or with any document incorporated by
reference that was filed with the SEC before the date of this prospectus supplement, you should rely on this prospectus supplement.
This prospectus supplement, the accompanying prospectus and the documents incorporated into each by reference include important
information about us, the securities being offered and other information you should know before investing in our securities. You
should also read and consider information in the documents we have referred you to in the section of this prospectus supplement
and the accompanying prospectus entitled “Incorporation by Reference” and “Where You Can Find Additional Information”
as well as any free writing prospectus provided in connection with this offering.
You
should rely only on this prospectus supplement, the accompanying prospectus, and any free writing prospectus provided in connection
with this offering and the information incorporated or deemed to be incorporated by reference in this prospectus supplement and
the accompanying prospectus. We have not authorized, and the underwriters have not authorized, anyone to provide you with information
that is in addition to or different from that contained or incorporated by reference in this prospectus supplement, the accompanying
prospectus, and any free writing prospectus provided in connection with this offering. If anyone provides you with different or
inconsistent information, you should not rely on it. We are not offering to sell these securities in any jurisdiction where the
offer or sale is not permitted. You should not assume that the information contained or incorporated by reference in this prospectus
supplement, the accompanying prospectus, or any free writing prospectus provided in connection with this offering is accurate
as of any date other than as of the date of this prospectus supplement, the accompanying prospectus, or such free writing prospectus,
as the case may be, or in the case of the documents incorporated by reference, the date of such documents regardless of the time
of delivery of this prospectus supplement and the accompanying prospectus or any sale of our securities. Our business, financial
condition, liquidity, results of operations and prospects may have changed since those dates.
Unless
the context otherwise indicates, references in this prospectus to “NanoVibronix”, “we”, “our”,
“us” and “the Company” refer, collectively, to NanoVibronix, Inc. and its subsidiaries.
No
action is being taken in any jurisdiction outside the United States to permit a public offering of the securities or possession
or distribution of this prospectus supplement, the accompanying prospectus, or any free writing prospectus provided in connection
with this offering in that jurisdiction. Persons who come into possession of this prospectus supplement, the accompanying prospectus,
or any free writing prospectus provided in connection with this offering in jurisdictions outside the United States are required
to inform themselves about and to observe any restrictions as to this offering and the distribution of this prospectus supplement,
the accompanying prospectus, or any free writing prospectus provided in connection with this offering applicable to that jurisdiction.
This prospectus supplement and the accompanying prospectus do not constitute, and may not be used in connection with, an offer
to sell, or a solicitation of an offer to buy, any securities offered by this prospectus supplement and the accompanying prospectus
by any person in any jurisdiction in which it is unlawful for such person to make such an offer or solicitation.
SPECIAL
NOTE REGARDING FORWARD-LOOKING STATEMENTS
This
prospectus supplement and the accompanying prospectus, including the documents that we incorporate by reference herein and therein,
contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities
Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act. Any statements about our expectations,
beliefs, plans, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. These
statements are often, but are not always, made through the use of words or phrases such as “anticipate,” “believe,”
“contemplate,” “continue,” “could,” “estimate,” “expect,” “intend,”
“may,” “plan,” “potential,” “predict,” “project,” “seek,”
“should,” “target,” “will,” “would,” and similar expressions, or the negative
of these terms, or similar expressions. Accordingly, these statements involve estimates, assumptions and uncertainties which could
cause actual results to differ materially from those expressed in them. No forward-looking statement is a guarantee of future
performance. Forward-looking statements are based on information we have when those statements are made or our management’s
good faith belief as of that time with respect to future events, and are subject to risks and uncertainties that could cause actual
performance or results to differ materially from those expressed in or suggested by the forward-looking statements.
We
have included important factors in the cautionary statements included in this prospectus supplement and the accompanying prospectus
and the documents we incorporate by reference herein and therein, particularly in the “Risk Factors” sections of these
documents, that we believe could cause actual results or events to differ materially from the forward-looking statements that
we make. Any forward-looking statements are qualified in their entirety by reference to the factors discussed throughout this
prospectus supplement and the accompanying prospectus, and in particular those factors referenced in the sections entitled “Risk
Factors.” Important factors that could cause such differences include, but are not limited to:
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The
UroShield has not been cleared or approved by the U.S. Food and Drug Administration, or FDA, nor has it undergone the same
type of review as an FDA-approved or cleared device.
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Our
ability to continue as a going concern.
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The
delisting of our common stock from Nasdaq.
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The
geographic, social and economic impact of COVID-19 on the Company’s business operations.
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The
timing of clinical studies and eventual FDA approval of our other product candidates.
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Regulatory
actions that could adversely affect the price of or demand for our approved products.
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Market
acceptance of existing and new products.
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Favorable
or unfavorable decisions about our products from government regulators, insurance companies or other third-party payers.
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Our
ability to regain compliance with the continued listing requirements of Nasdaq and the risk that our common stock will be
delisted if we cannot do so.
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Our
intellectual property portfolio.
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Our
ability to recruit and retain qualified regulatory and research and development personnel.
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The
impact of cybersecurity risks and incidents and the related actual or potential costs and consequences of such risks and incidents,
including costs to limit such risks.
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Unforeseen
changes in healthcare reimbursement for any of our approved products.
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Lack
of financial resources to adequately support our operations.
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Difficulties
in maintaining commercial scale manufacturing capacity and capability.
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Our
ability to generate internal growth.
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Changes
in our relationship with key collaborators.
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Changes
in the market valuation or earnings of our competitors or companies viewed as similar to us.
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Our
failure to comply with regulatory guidelines.
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Uncertainty
in industry demand and patient wellness behavior.
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General
economic conditions and market conditions in the medical device industry.
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Future
sales of large blocks of our common stock, which may adversely impact our stock price.
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Our
ability to comply with our contractual covenants, including in respect to our debt.
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Depth
of the trading market in our common stock.
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You
should read this prospectus supplement and the accompanying prospectus and the documents that we incorporate by reference herein
and therein completely and with the understanding that our actual future results may be materially different from what we expect.
The forward-looking statements in this prospectus supplement and the accompanying prospectus and the documents we incorporate
by reference herein and therein represent our views as of the date of this prospectus supplement. Our forward-looking statements
do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures or investments we may make.
We anticipate that subsequent events and developments will cause our views to change. However, while we may elect to update these
forward-looking statements at some point in the future, we have no current intention of doing so except to the extent required
by applicable law. You should, therefore, not rely on these forward-looking statements as representing our views as of any date
subsequent to the date of this prospectus supplement.
PROSPECTUS
SUPPLEMENT SUMMARY
The
following summary of our business highlights some of the information contained elsewhere in, or incorporated by reference into,
this prospectus supplement. Because this is only a summary, however, it does not contain all of the information that may be important
to you. You should carefully read this prospectus supplement and the accompanying prospectus, including the documents incorporated
by reference, which are described under “Incorporation by Reference” in this prospectus supplement. You should also
carefully consider the matters discussed in the section of this prospectus supplement entitled “Risk Factors” and
under similar sections of the accompanying prospectus and other periodic reports incorporated herein and therein by reference.
Company
Overview
We
are a medical device company focusing on noninvasive biological response-activating devices that target wound healing and pain
therapy and can be administered at home, without the assistance of medical professionals. Our primary products, which are in various
stages of clinical and market development, currently consist of:
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UroShield™,
an ultrasound-based product that is designed to prevent bacterial colonization and biofilm in urinary catheters, increase
antibiotic efficacy and decrease pain and discomfort associated with urinary catheter use;
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PainShield™,
a patch-based therapeutic ultrasound technology to treat pain, muscle spasm and joint contractures by delivering a localized
ultrasound effect to treat pain and induce soft tissue healing in a targeted area; and
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WoundShield™,
a patch-based therapeutic ultrasound device intended to facilitate tissue regeneration and wound healing by using ultrasound
to increase local capillary perfusion and tissue oxygenation.
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Each
of our PainShield, UroShield, and WoundShield products employs a small, disposable transducer that transmits low frequency, low
intensity ultrasound acoustic waves that seek to repair and regenerate tissue, musculoskeletal and vascular structures, and decrease
biofilm formation on urinary catheters and associated urinary tract infections. Through their size, effectiveness and ease of
use, these products are intended to eliminate the need for technicians and medical personnel to manually administer ultrasound
treatment through large transducers, thereby promoting patient independence and enabling more cost-effective home-based care.
In
September 2020, the FDA exercised its enforcement discretion to allow distribution of our UroShield device in the United States.
This temporary authorization is limited to use as an extracorporeal acoustic wave generating accessory to urological indwelling
catheter for use during the COVID-19 pandemic.
PainShield
is currently cleared for marketing in the United States by the FDA although to date there has not been a significant sales and
marketing effort. Effective June 22, 2020, we entered into a two-year exclusive agreement with Ultra Pain Products, Inc. for the
distribution of our PainShield devices and components through and by Durable Medical Equipment (DME) Distributors throughout the
United States.
In
the United States, PainShield requires a prescription from a licensed healthcare practitioner. If FDA clearance is obtained, we
anticipate that WoundShield and UroShield will require a prescription from a licensed healthcare practitioner in the United States.
We anticipate that UroShield will be sold directly to health care facilities and therefore will not require a prescription for
these venues. However, in other countries in which we sell PainShield, UroShield, and WoundShield, such products are eligible
for sale without a prescription. We are working toward a new PainShield 510(k) submission which would potentially remove the requirement
for a prescription.
All
three of our products have CE Mark approval in the European Union, and a certificate allowing us to sell PainShield, UroShield
and WoundShield in Israel. We are able to sell PainShield, UroShield and WoundShield in India and Ecuador based on our CE Mark.
We have consummated sales of PainShield and UroShield in the relevant markets, although to date sales have been minimal; WoundShield
has not generated significant revenue to date. Outside of the United States we generally apply, through our distributor, for approval
in a particular country for a particular product only when we have a distributor in place with respect to such product. We have
entered into recent distribution partnerships for UroShield in the U.K., Switzerland, Israel and India.
Recent
Developments
COVID-19
In
December 2019, a strain of coronavirus, or COVID-19, was reported to have surfaced in Wuhan, China, and has spread globally, resulting
in government-imposed quarantines, travel restrictions and other public health safety measures in China and other affected countries.
The ongoing COVID-19 pandemic has and may continue to adversely impact our business, as our operations are based in and rely on
third parties located in countries affected by the pandemic. Our third-party manufacturer, which is based in China, temporarily
shut down for sixty days due to the outbreak and only became fully operational in April 2020 which led to a significant delay
in the production of goods needed to fulfill our sales orders which were scheduled to be fulfilled in our first quarter on 2020.
We were able to fulfill these orders in the second quarter of 2020. Additionally, the notified regulatory body we rely on to obtain
European CE approval is located in Italy and was shut down for approximately six weeks in March and April 2020, which delayed
our submission for CE mark approval for the year 2020. The CE Mark was subsequently approved in April 2020. The various precautionary
measures taken by many governmental authorities around the world in order to limit the spread of COVID-19 has had and may continue
to have an adverse effect on the global markets and global economy, including on the availability and pricing of employees, resources,
materials, manufacturing and delivery efforts and other aspects of the global economy. The financial downturn has compelled us
to furlough or reduce working hours for much of our operating staff, and has forced remaining staff as well as third-party contractors,
and our clients may encounter cash-flow issues that will delay their payments to us. In addition, remaining staff members have
been forced to operate remotely from their homes, which is continuing, resulting in delays in obtaining certain financial records.
We also rely on third-party professionals to provide services such as the preparation of our financial statements and to conduct
audits, and many of these parties have been affected by government-imposed precautionary measures, thereby delaying our receipt
of these services. Such government-imposed precautionary measures may have been relaxed in certain countries or states, but there
is no assurance that more strict measures will be put in place again due to a resurgence in COVID-19 cases. Therefore, the COVID-19
pandemic has and may again disrupt production and cause delays in the supply and delivery of our products, may continue to affect
our operation, may further divert the attention and efforts of the medical community to coping with COVID-19 and disrupt the marketplace
in which we operate and may have a material adverse effect on our operations. Assessment of the complete extent of the impact
of COVID-19 on our results will depend on future developments, which are highly uncertain and cannot be predicted, including new
information which may emerge concerning the severity of COVID-19 and the actions to contain COVID-19 or treat its impact, among
others. The continuation of the COVID-19 pandemic could materially disrupt our business and operations, hamper our ability to
raise additional funds or sell or securities, continue to slow down the overall economy, curtail consumer spending, interrupt
our sources of supply, and make it hard to adequately staff our operations.
Cybersecurity
Incident
In
June 2020, we experienced a cybersecurity incident. Specifically, we believe that one or two unauthorized third parties were able
to use an email domain similar to the Company’s to convince two of our customers to send payments in the aggregate amount
of approximately $308,000 to unauthorized bank accounts that should have been sent to us. Both customers were able to reclaim
the fraudulent transfers and subsequently deposited them into our bank account; $78,000 was paid in June 2020, and $230,000 was
paid in July 2020.
Our
management notified the appropriate government authorities and has been exploring a range of steps to enhance its security protections
and prevent future unauthorized activity. We have not incurred, nor do we expect to incur significant costs related to investigating
this incident.
Nasdaq
Delisting
Our
common stock is currently listed for trading on Nasdaq. We must satisfy Nasdaq’s continued listing requirements or risk
delisting. On September 14, 2018, we received a letter from the Listing Qualifications Staff, or the Staff, of Nasdaq notifying
the Company that it was no longer in compliance with the minimum stockholders’ equity requirement for continued listing
on Nasdaq. Nasdaq Listing Rule 5550(b)(1) requires listed companies to maintain stockholders’ equity of at least $2.5 million,
or the Equity Requirement.
Following
a hearing on May 2, 2019, a Nasdaq Hearings Panel was appointed to review our compliance with the Equity Requirement, and on August
5, 2020, the Staff issued a letter to us in which it indicated that, since we had failed to report stockholders’ equity
of at least $2.5 million in each of its last three periodic reports filed with the Securities and Exchange Commission, our common
shares would be subject to delisting on August 14, 2020, unless we request an appeal of this determination by 4:00 p.m. Eastern
Time on August 12, 2020, or the Hearing Request.
We
timely requested a Hearing Request, which automatically stayed
any suspension or delisting action pending a decision of a Nasdaq Hearings Panel. The hearing occurred on August 12, 2020.
At the hearing, we provided the Nasdaq Hearings Panel with an update on our compliance plan and requested
a further extension of time in which to regain compliance. As of the date of this prospectus supplement, we have not received
a decision from the Nasdaq Hearing Panel.
There
can be no assurance that the Company’s plan will be accepted by the Nasdaq Hearings Panel or that, if it is, the Company
will be able to regain compliance with the applicable Nasdaq listing requirements. If the Company’s common stock is delisted,
it could be more difficult to buy or sell the Company’s common stock or to obtain accurate quotations, and the price of
the Company’s common stock could suffer a material decline. In addition, delisting could harm our ability to raise capital
through alternative financing sources on terms acceptable to us, or at all, and may result in the potential loss of confidence
by investors, suppliers, customers and employees and fewer business development opportunities.
August
2020 Common Stock Issuance
On
February 11, 2019, we entered into a consulting agreement, or the Agreement, with Bespoke Growth Partners, Inc., or Bespoke, pursuant
to which, amongst other things, Bespoke was entitled to receive up to 650,000 shares of our common stock, of which 275,000 shares
were issued on the date of signing. On August 5, 2020, we issued an additional 375,000 shares of common stock to Bespoke under
the Agreement, representing approximately 7.5% of our issued and outstanding shares of common stock, as of the date thereof. Such
issuance was undertaken in reliance upon the exemption from the registration requirements of the Securities Act, pursuant to Section
4(a)(2) thereof and Rule 506 of Regulation D promulgated thereunder.
August
2020 Public Offering
On
August 27, 2020, we sold an aggregate of 4,531,434 shares of common stock in an underwritten public offering, or the August 2020
Offering, at an offering price to the public of $0.75 per share. We received net proceeds from the August 2020 Offering, after
deducting underwriting discounts and commissions and other estimated offering expenses payable by us, of approximately $2.7 million.
Implications
of being an Emerging Growth Company
As
a company with less than $1.07 billion in revenue during our last fiscal year, we qualify as an “emerging growth company”
as defined in the JOBS Act enacted in April 2012. An “emerging growth company” may take advantage of exemptions from
some of the reporting requirements that are otherwise applicable to public companies. These exceptions include:
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being
permitted to present only two years of audited financial statements and only two years of related Management’s Discussion
and Analysis of Financial Condition and Results of Operations in this prospectus;
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not
being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, as amended,
or the Sarbanes-Oxley Act;
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reduced
disclosure obligations regarding executive compensation in our periodic reports, proxy statements and registration statements;
and
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exemptions
from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden
parachute payments not previously approved.
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We
may take advantage of these provisions until the last day of our fiscal year following the fifth anniversary of the closing of
our initial public offering. However, if certain events occur prior to the end of such five-year period, including if we become
a “large accelerated filer,” our annual gross revenue exceeds $1.07 billion or we issue more than $1.0 billion of
non-convertible debt in any three-year period, we will cease to be an emerging growth company prior to the end of such five-year
period.
In
addition, the JOBS Act provides that an emerging growth company can take advantage of an extended transition period for complying
with new or revised accounting standards. We have elected to avail ourselves of this exemption.
Company
Information
We
were organized in the State of Delaware on October 20, 2003. Our principal executive offices are located at 525 Executive Boulevard,
Elmsford, New York 10523. Our telephone number is (914) 233-3004. Our website address is www.nanovibronix.com. Information accessed
through our website is not incorporated into this prospectus and is not a part of this prospectus.
THE
OFFERING
Common
Stock offered by us
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1,794,783
shares
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Shares of Common Stock to be Outstanding after this Offering (1)
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12,362,871
shares (or 12,632,088 shares if the underwriters exercise their option to purchase additional shares in full).
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Underwriters’
option to purchase additional shares of common stock
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We
have granted the underwriters an option, exercisable for 30 days from the date of this prospectus supplement, to purchase
up to an additional 269,217 shares of our common stock from us.
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Use
of proceeds
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We
intend to use the net proceeds from this offering for working capital and other general corporate purposes, including for
the transition of manufacturing of our products from China to the United States and purchase of inventory. See “Use
of Proceeds” on page S-10.
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Risk
factors
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An
investment in our securities involves a high degree of risk.
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See
the “Risk Factors” section of this prospectus supplement and in the documents incorporated by reference in this
prospectus supplement for a discussion of factors to consider before deciding to invest in our securities.
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Nasdaq
Capital Market symbol
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“NAOV”
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(1)
The number of shares of our common stock that will be outstanding immediately after this offering as shown above is based on 10,568,088
shares outstanding as of September 22, 2020, and, unless otherwise indicated, excludes:
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1,468,294
shares of common stock issuable upon the exercise of stock options issued under the 2014 Long-Term Incentive Plan, or the
2014 Plan, outstanding as of September 22, 2020 at a weighted-average exercise price of $2.78 per share;
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275,038
shares of common stock issuable upon the exercise of stock options issued outside of the 2014 Plan outstanding as of September
22, 2020 at a weighted-average exercise price of $5.83 per share;
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2,505,252
shares of common stock issuable upon conversion of outstanding Series C Convertible Preferred Stock;
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283,782
shares of common stock issuable upon conversion of outstanding Series D Convertible Preferred Stock;
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875,000
shares of common stock issuable upon conversion of outstanding Series E Convertible Preferred Stock;
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3,365,272
shares of common stock issuable upon the exercise of warrants outstanding as of September 22, 2020 at a weighted average exercise
price of $5.07 per share;
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100,000
shares of common stock or Series C Convertible Preferred Stock, at the discretion of the holder, issuable upon the exercise
of warrants as of September 22, 2020 at an exercise price of $2.00 per share;
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1,810,000
shares of common stock issuable upon conversion of Series E Convertible Preferred Stock issuable upon the exercise of warrants
to purchase Series E Convertible Preferred Stock outstanding as of September 22, 2020 at an exercise price of $2.50 per share;
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260,763
shares of common stock reserved for future issuance under our 2014 Plan; and
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up
to 134,609 shares of common stock (or if the underwriters exercise their option to purchase additional shares of common
stock in full, up to 154,800 shares of common stock) issuable upon exercise of warrants with an exercise price of $1.25 per
share to be issued to the representative of the underwriters or its designees in connection with this offering.
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Except
as otherwise indicated, the information in this prospectus supplement assumes (i) no exercise of the underwriters’ option
to purchase additional shares of common stock, (ii) no exercise of the warrants to be issued to the representative of the underwriters
or its designees in connection with this offering and (iii) no exercise of options or exercise of warrants and no conversion of
any shares of preferred stock described above.
RISK
FACTORS
An
investment in our securities involves a high degree of risk. Before deciding whether to invest in our securities, you should consider
carefully the risks described below, together with other information in this prospectus supplement, the accompanying prospectus,
the information and documents incorporated by reference. You should also consider the risks, uncertainties and assumptions discussed
under the heading “Risk Factors” included in our most recent annual report on Form 10-K and the subsequent quarterly
reports on Form 10-Q and other reports that we file with the SEC which are on file with the SEC and are incorporated herein by
reference, and which may be amended, supplemented or superseded from time to time by other reports we file with the SEC in the
future. If any of these risks actually occurs, our business, financial condition, results of operations or cash flow could be
seriously harmed. This could cause the trading price of our common stock to decline, resulting in a loss of all or part of your
investment. The risks and uncertainties described below are not the only ones facing us. Additional risks and uncertainties not
presently known to us, or that we currently see as immaterial, may also harm our business. Please also read carefully the section
below entitled “Special Note Regarding Forward-Looking Statements.”
Risks
Related to Our Business
The
UroShield has not been cleared or approved by the FDA, nor has it undergone the same type of review as an FDA-approved or
cleared device.
In
September 2020, the FDA exercised its enforcement discretion to allow distribution of our UroShield device in the United States.
This temporary authorization is limited to use as an extracorporeal acoustic wave generating accessory to urological indwelling
catheter for use during the COVID-19 pandemic. The FDA may terminate or revoke this enforcement discretion policy at any time
(after which the applicable products may no longer be used). There is no guarantee that our collaborators or customers will purchase
or use the UroShield, that any sales of UroShield by us will generate any revenue or profits, or that we will ever be successful
in obtaining FDA clearance or approval for the UroShield.
We
have identified conditions and events that raise substantial doubt about our ability to continue as a going concern.
Based
on our current operating plans, we estimate that, without the proceeds from this offering, we will not have sufficient capital
to fund our operations and will be forced to amend, delay, limit, reduce or terminate the scope of our development programs and/or
limit or cease our operations. As of June 30, 2020, we had no cash or cash equivalents, and had $202,000 that was restricted per
a court order resulting from a dispute between us and a former officer and director. These conditions raise substantial doubt
about our ability to continue as a going concern. Even with the proceeds from this offering, we may require additional capital
to sustain our operations, for the commercialization of our PainShield and UroShield products. We may seek additional funds through
equity or debt financings or strategic alliances with third parties, either alone or in combination with equity financings. However,
there can be no assurance that we will be able to complete any such transaction on acceptable terms or otherwise. The failure
to obtain sufficient funds on commercially acceptable terms when needed would have a material adverse effect on our business,
results of operations and financial condition and jeopardize our ability to remain listed on Nasdaq or to continue operations
at all. Issuances of additional debt or equity securities could impact the rights of the holders of our common stock and may dilute
their ownership percentage. Moreover, the establishment of other funding facilities may impose restrictions on our operations.
These restrictions could include limitations on additional borrowing and specific restrictions on the use of our assets, as well
as prohibitions on our ability to create liens, pay dividends, redeem our stock or make investments.
The
recent coronavirus outbreak may adversely affect our business.
In
December 2019, COVID-19 was reported to have surfaced in Wuhan, China, and has reached multiple other countries, resulting in
government-imposed quarantines, travel restrictions and other public health safety measures in China and other affected countries.
The ongoing COVID-19 pandemic has and may continue to adversely impact our business, as our operations are based in and rely on
third parties located in countries affected by the outbreak. Our third-party manufacturer, which is based in China, temporarily
shut down for sixty days due to the outbreak and became fully operational in April 2020 which led to a significant delay in the
production of goods needed to fulfill our sales orders which were scheduled to be fulfilled in our first quarter of 2020. We were
able to fulfill these orders in the second quarter of 2020. Additionally, the notified regulatory body we rely on to obtain European
CE approval is located in Italy and has been shut down for approximately six weeks from March to April 2020, which delayed our
submission for CE mark approval for the year 2020. The CE Mark was subsequently approved in April 2020. The various precautionary
measures taken by many governmental authorities around the world in order to limit the spread of COVID-19 has had and may continue
to have an adverse effect on the global markets and global economy, including on the availability and pricing of employees, resources,
materials, manufacturing and delivery efforts and other aspects of the global economy. The financial downturn has compelled us
to furlough or reduce working hours for much of our operating staff, and has forced remaining staff as well as third-party contractors,
and our clients may encounter cash-flow issues that will delay their payments to us. In addition, remaining staff members have
been forced to operate remotely from their homes, which is continuing to result in delays in obtaining certain financial records.
We also rely on third-party professionals to provide services such as the preparation of our financial statements and to conduct
audits, and many of these parties have been affected by government-imposed precautionary measures, thereby delaying our receipt
of these services. Such government-imposed precautionary measures may have been relaxed in certain countries or states, but there
is no assurance that more strict measures will be put in place again due to a resurgence in COVID-19 cases. Therefore, the COVID-19
pandemic has and may again disrupt production and cause delays in the supply and delivery of our products, may continue to affect
our operation, may further divert the attention and efforts of the medical community to coping with COVID-19 and disrupt the marketplace
in which we operate and may have a material adverse effect on our operations. Assessment of the complete extent to which COVID-19
impacts our results will depend on future developments, which are highly uncertain and cannot be predicted, including new information
which may emerge concerning the severity of COVID-19 and the actions to contain COVID-19 or treat its impact, among others. The
continuation of the COVID-19 pandemic could materially disrupt our business and operations, hamper our ability to raise additional
funds or sell or securities, continue to slow down the overall economy, curtail consumer spending, interrupt our sources of supply,
and make it hard to adequately staff our operations.
If
we fail to maintain effective internal control over financial reporting, our business, financial condition or results of operations
may be adversely affected.
As
a public reporting company, we are required to establish and maintain effective internal control over financial reporting. Failure
to establish such internal control, or any failure of such internal control once established, could adversely impact our public
disclosures regarding our business, financial condition or results of operations. Any failure of our internal control over financial
reporting could also prevent us from maintaining accurate accounting records and discovering accounting errors and financial frauds.
Rules
adopted by the SEC pursuant to Section 404 of the Sarbanes-Oxley Act require annual assessment of our internal control over financial
reporting. The standards that must be met for management to assess the internal control over financial reporting as effective
are complex, and require significant documentation, testing and possible remediation to meet the detailed standards. We may encounter
problems or delays in completing activities necessary to make an assessment of our internal control over financial reporting.
If we cannot assess our internal control over financial reporting as effective, investor confidence and share value may be negatively
impacted. In addition, management’s assessment of internal control over financial reporting may identify weaknesses and
conditions that need to be addressed in our internal control over financial reporting or other matters that may raise concerns
for investors. Any actual or perceived weaknesses and conditions that need to be addressed in our internal control over financial
reporting (including those weaknesses identified in our periodic reports), or disclosure of management’s assessment of our
internal control over financial reporting may have an adverse impact on the price of our securities.
We
have identified a material weakness in our internal control over financial reporting due to a lack of a full and complete testing
of our disclosure controls and procedures. We concluded that our internal control over financial reporting and related disclosure
controls and procedures were not effective as of June 30, 2020. Our management has implemented remediation measures and expects
that such measures will be sufficient to fully remediate the material weakness in our internal control over financial reporting
that existed at June 30, 2020; however, we cannot guarantee that these steps will be sufficient to remediate the deficiencies
or that we will not have a material weakness in the future. If our remedial measures are insufficient to address the material
weakness or if additional material weaknesses arise in the future, our interim or annual financial statements may contain material
misstatements or omissions and we could be required to restate our financial results.
Our
business and operations would suffer in the event of computer system failures, cyber-attacks or deficiencies in our cyber-security
or those of third-party providers.
In
the ordinary course of our business, we collect and store sensitive data, including intellectual property, research data, our
proprietary business information and that of our suppliers, technical information about our products, clinical trial plans and
employee records. Similarly, our third-party providers possess certain of our sensitive data and confidential information. The
secure maintenance of this information is critical to our operations and business strategy. Despite the implementation of security
measures, our internal computer systems, and those of third parties on which we rely, are vulnerable to damage from computer viruses,
malware, ransomware, cyber fraud, natural disasters, terrorism, war, telecommunication and electrical failures, cyber-attacks
or cyber-intrusions over the Internet, attachments to emails, persons inside our organization, or persons with access to systems
inside our organization. The risk of a security breach or disruption, particularly through cyber-attacks or cyber intrusion, including
by computer hackers, foreign governments, and cyber terrorists, has generally increased as the number, intensity and sophistication
of attempted attacks and intrusions from around the world have increased. Any such breach could compromise our networks and the
information stored there could be accessed, publicly disclosed, encrypted, lost or stolen. Any such access, inappropriate disclosure
of confidential or proprietary information or other loss of information, including our data being breached at third-party providers,
could result in legal claims or proceedings, liability or financial loss under laws that protect the privacy of personal information,
disruption of our operations or our product development programs and damage to our reputation, which could adversely affect our
business.
Furthermore,
we and our third-party providers rely on electronic communications and information system to conduct our operations. We and our
third-party providers have been, and may continue to be, targeted by parties using fraudulent e-mails and other communications
in attempts to misappropriate bank accounting information, passwords, or other personal information or to introduce viruses or
other malware to our information systems. In June 2020, we experienced a cybersecurity incident. Specifically, we believe that
one or two unauthorized third parties were able to use an email domain similar to ours to convince two of our customers to send
payments in the aggregate amount of approximately $308,000 to unauthorized bank accounts that should have been sent to us. As
of the date of this filing, all funds have been recovered by the Company. Our management has launched an investigation into the
incident and has notified the appropriate government authorities. We have been exploring a range of steps to enhance our security
protections and prevent future unauthorized activity. Though we endeavor to mitigate these threats, such cyber-attacks against
us or our third-party providers and business partners remain a serious issue. The pervasiveness of cybersecurity incidents in
general and the risks of cyber-crime are complex and continue to evolve. Although we are making significant efforts to maintain
the security and integrity of our information systems and are exploring various measures to manage the risk of a security breach
or disruption, there can be no assurance that our security efforts and measures will be effective or that attempted security breaches
or disruptions would not be successful or damaging.
If
we fail to comply with the continued listing requirements of Nasdaq, our common stock may be delisted and the price of our common
stock and our ability to access the capital markets could be negatively impacted.
Our
common stock is currently listed for trading on Nasdaq. We must satisfy Nasdaq’s continued listing requirements, including,
among other things, a minimum stockholders’ equity of $2.5 million or risk delisting, which would have a material
adverse effect on our business. A delisting of our common stock from Nasdaq could materially reduce the liquidity of our common
stock and result in a corresponding material reduction in the price of our common stock. In addition, delisting could harm our
ability to raise capital through alternative financing sources on terms acceptable to us, or at all, and may result in the potential
loss of confidence by investors, suppliers, customers and employees and fewer business development opportunities.
On
September 14, 2018, we received a letter from the Staff of The Nasdaq Stock Market LLC notifying the Company that it was no longer
in compliance with the minimum stockholders’ equity requirement for continued listing on Nasdaq. Nasdaq Listing Rule 5550(b)(1)
requires listed companies to maintain stockholders’ equity of at least $2.5 million.
Following
a hearing on May 2, 2019, a Nasdaq Hearings Panel was appointed to review our compliance with the Equity Requirement, and on August
5, 2020, the Staff issued a letter to us in which it indicated that, since we had failed to report stockholders’ equity
of at least $2.5 million in each of its last three periodic reports filed with the Securities and Exchange Commission, our common
shares would be subject to delisting on August 14, 2020, unless we request an appeal of this determination by 4:00 p.m. Eastern
Time on August 12, 2020.
We
timely requested a Hearing Request, which automatically stayed
any suspension or delisting action pending a decision of a Nasdaq Hearings Panel. The hearing occurred on August 12, 2020.
At the hearing, we provided the Nasdaq Hearings Panel with an update on our compliance plan and requested
a further extension of time in which to regain compliance. As of the date of this prospectus supplement, we have not received
a decision from the Nasdaq Hearing Panel.
However,
there can be no assurance that our plan will be accepted by the Nasdaq Hearings Panel or that, if it is, we will be able to regain
compliance with the applicable Nasdaq listing requirements. If our common stock is delisted, it could be more difficult to buy
or sell our common stock or to obtain accurate quotations, and the price of our common stock could suffer a material decline.
Delisting could also impair our ability to raise capital.
If
our common stock were delisted from Nasdaq, trading of our common stock would most likely take place on an over-the-counter market
established for unlisted securities, such as the OTCQB or the Pink Market maintained by OTC Markets Group Inc. An investor would
likely find it less convenient to sell, or to obtain accurate quotations in seeking to buy, our common stock on an over-the-counter
market, and many investors would likely not buy or sell our common stock due to difficulty in accessing over-the-counter markets,
policies preventing them from trading in securities not listed on a national exchange or other reasons. In addition, as a delisted
security, our common stock would be subject to SEC rules as a “penny stock,” which impose additional disclosure requirements
on broker-dealers. The regulations relating to penny stocks, coupled with the typically higher cost per trade to the investor
of penny stocks due to factors such as broker commissions generally representing a higher percentage of the price of a penny stock
than of a higher-priced stock, would further limit the ability of investors to trade in our common stock. For these reasons and
others, delisting would adversely affect the liquidity, trading volume and price of our common stock, causing the value of an
investment in us to decrease and having an adverse effect on our business, financial condition and results of operations, including
our ability to attract and retain qualified employees and to raise capital.
Risks
Related to Our Common Stock and this Offering
If
you purchase securities in this offering, you will suffer immediate dilution of your investment.
The
offering price of our common stock in this offering is substantially higher than the net tangible book value per share of our
common stock. Therefore, if you purchase securities in this offering, you will pay a price per share of our common stock that
substantially exceeds our net tangible book value per share after giving effect to this offering. Based on an offering price of
$1.00 per share of our common stock, if you purchase securities in this offering, you will experience immediate dilution of $0.66
per share, representing the difference between the offering price per share of our common stock and our pro forma as adjusted
net tangible book value per share after giving effect to this offering. Furthermore, if any of our outstanding options or warrants
are exercised at prices below the offering price, or if we grant additional options or other awards under our equity incentive
plans or issue additional warrants, you may experience further dilution of your investment. See the section entitled “Dilution”
below for a more detailed illustration of the dilution you would incur if you participate in this offering.
Because
we will have broad discretion and flexibility in how the net proceeds from this offering are used, we may use the net proceeds
in ways in which you disagree.
We
intend to use the net proceeds from this offering for working capital and other general corporate purposes, including for the
transition of manufacturing of our products from China to the United States and purchase of inventory. See “Use of Proceeds”
on page S-10. We have not allocated specific amounts of the net proceeds from this offering for any of the foregoing purposes.
Accordingly, our management will have significant discretion and flexibility in applying the net proceeds of this offering. You
will be relying on the judgment of our management with regard to the use of these net proceeds, and you will not have the opportunity,
as part of your investment decision, to assess whether the net proceeds are being used appropriately. It is possible that the
net proceeds will be invested in a way that does not yield a favorable, or any, return for us. The failure of our management to
use such funds effectively could have a material adverse effect on our business, financial condition, operating results and cash
flow.
We
expect we will need to raise additional capital shortly after this offering, which may involve issuance of our securities. You
may experience future dilution as a result of future equity offerings and other issuances of our securities. In addition, this
offering and future equity offerings and other issuances of our common stock or other securities may adversely affect the price
of our common stock.
Even
with the proceeds from this offering, we expect we will need to raise additional capital, potentially shortly after this offering.
In order to raise additional capital in the future, we may offer additional shares of common stock or other securities convertible
into or exchangeable for our common stock. Subject to lock-up provisions described under “Underwriting,” we are generally
not restricted from issuing additional securities, including shares of common stock, securities that are convertible into or exchangeable
for, or that represent the right to receive, common stock or substantially similar securities. In particular, we may conduct one
or more additional offerings following this offering and may seek waiver of the lock-up provisions described under “Underwriting”
to conduct such offerings. The issuance of securities in these or any other offerings may cause further dilution to our stockholders,
including investors in this offering. We may not be able to sell shares or other securities in any other offering at a price per
share that is equal to or greater than the price per share paid by investors in this offering, and investors purchasing shares
or other securities in the future could have rights superior to existing stockholders. The price per share at which we sell additional
shares of common stock or securities convertible into shares of common stock in future transactions may be higher or lower than
the price per share in this offering. You will also incur dilution upon exercise of any outstanding stock options, warrants or
upon the issuance of shares of common stock under our stock incentive programs. In addition, the sale of shares of common stock
in this offering and any future sales of a substantial number of shares of common stock in the public market, or the perception
that such sales may occur, could adversely affect the price of our common stock. We cannot predict the effect, if any, that market
sales of those shares of common stock or the availability of those shares for sale will have on the market price of our common
stock.
USE
OF PROCEEDS
We
estimate that the net proceeds from the sale of shares that we are offering, after deducting underwriting discounts and commissions
and estimated offering expenses payable by us, will be approximately $1,419,326, or approximately $1,665,660 if the underwriters
exercise in full their option to purchase 269,217 additional shares.
We
intend to use the net proceeds from this offering for working capital and other general corporate purposes, including for the
transition of manufacturing of our products from China to the United States and purchase of inventory. This expected use of proceeds
from this offering represents our intentions based upon our current plans and prevailing business conditions, which could change
in the future as our plans and prevailing business conditions evolve. The amounts and timing of our use of proceeds will vary
depending on a number of factors, including the amount of cash generated or used by our operations.
Except
as noted above, we have not determined the amounts we plan to spend on any of the areas listed above or the timing of these expenditures.
As a result, our management will have broad discretion to allocate the net proceeds from this offering. Pending application of
the net proceeds as described above, we intend to invest the net proceeds to us from this offering in a variety of capital preservation
investments, including short-term, investment-grade and interest-bearing instruments.
DIVIDEND
POLICY
We
have never declared or paid any dividends on our common stock, and we do not intend to pay any cash dividends on our common stock.
Rather, we currently intend to retain all available funds and any future earnings, if any, to fund the development and expansion
of our business and for general corporate purposes, and we do not anticipate paying any cash dividends in the foreseeable future.
Moreover, any future indebtedness that we may incur could preclude us from paying dividends. Any future determination to pay dividends
will be made at the discretion of our board of directors. Investors should not purchase our common stock with the expectation
of receiving cash dividends.
DILUTION
If
you invest in our common stock, your ownership interest will be diluted by the difference between the price per share you pay
and the net tangible book value per share of our common stock immediately after this offering.
Our
net tangible book value as of June 30, 2020, was approximately $(784,000), or $(0.18) per share of our common stock, based upon
4,313,764 shares of our common stock outstanding as of that date. Net tangible book value per share is determined by dividing
our total tangible assets, less total liabilities, by the number of shares of our common stock outstanding as of June 30, 2020.
Dilution in net tangible book value per share represents the difference between the amount per share paid by purchasers of shares
of common stock in this offering and the net tangible book value per share of our common stock immediately after this offering.
After
giving effect to (i) the issuance of 375,000 shares of common stock pursuant to a Consulting Agreement dated as of February 19,
2019, by and among the Company and a consultant, (ii) the conversion of 840,000 shares of Series E Preferred Stock into 840,000
shares of common stock, subsequent to June 30, 2020, (iii) the conversion of 487,890 shares of Series C Preferred Stock into 487,890
shares of common stock, subsequent to June 30, 2020, (iv) the conversion of 20 shares of Series D Preferred Stock into
20,000 shares of common stock, subsequent to June 30, 2020, and (v) the issuance of 4,531,434 shares of our common stock and the
receipt of the net proceeds, after deducting underwriting discounts and commissions and other estimated offering expenses payable
by us, of approximately $2.7 million in the August 2020 Offering, our pro forma net tangible book value as of June 30, 2020 would
have been $2,806,292, or $0.27 per share.
After
giving further effect to the sale of 1,794,783 shares of our common stock in this offering at the price of $1.00 per share and
after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us, our pro forma
as-adjusted net tangible book value as of June 30, 2020, would have been approximately $4,225,609, or $0.34 per share. This represents
an immediate increase in pro forma net tangible book value of $0.07 per share to existing stockholders and immediate dilution
in pro forma net tangible book value of $0.66 per share to new investors. The following table illustrates this dilution on a per
share basis:
Public offering price per share
|
|
|
|
|
|
$
|
1.00
|
|
Net tangible book value per share as of June 30, 2020
|
|
$
|
(0.18
|
)
|
|
|
|
|
Increase in net
tangible book value per share attributable to the adjustments described above
|
|
|
0.45
|
|
|
|
|
|
Pro forma net tangible book value per share as of June 30, 2020
|
|
$
|
0.27
|
|
|
|
|
|
Increase in pro forma net tangible book
value per share attributable to this offering
|
|
$
|
0.07
|
|
|
|
|
|
Pro forma as-adjusted
net tangible book value per share as of June 30, 2020 after giving effect to this offering
|
|
|
|
|
|
$
|
0.34
|
|
Dilution in pro forma net tangible book
value per share to new investors
|
|
|
|
|
|
$
|
0.66
|
|
If
the underwriters exercise their option to purchase additional shares in full, the pro forma as-adjusted net tangible book value
per share after this offering would be $0.35 per share, and the dilution in pro forma net tangible book value per share
to new investors purchasing common shares in this offering would be $0.65 per share, after deducting estimated underwriting
discounts and commissions and estimated offering expenses payable by us.
The
foregoing table and discussion are based on 4,313,764 shares outstanding as of June 30, 2020, and, unless otherwise indicated,
excludes:
|
●
|
1,298,294
shares of common stock issuable upon the exercise of stock options issued under the 2014 Plan outstanding as of June 30, 2020
at a weighted-average exercise price of $2.90 per share;
|
|
|
|
|
●
|
275,038
shares of common stock issuable upon the exercise of stock options issued outside of the 2014 Plan outstanding as of June
30, 2020 at a weighted-average exercise price of $5.83 per share;
|
|
●
|
2,993,142
shares of common stock issuable upon conversion of outstanding Series C Convertible Preferred Stock, which includes 487,890
shares of Series C Convertible Preferred Stock that were converted following June 30, 2020, with such conversion given effect
in the pro forma calculation in the table above;
|
|
|
|
|
●
|
303,782
shares of common stock issuable upon conversion of outstanding Series D Convertible Preferred Stock, which includes 20 shares
of Series D Convertible Preferred Stock that were converted following June 30, 2020, with such conversion given effect in
the pro forma calculation in the table above;
|
|
|
|
|
●
|
1,715,000
shares of common stock issuable upon conversion of outstanding Series E Convertible Preferred Stock, which includes 840,000
shares of Series E Convertible Preferred Stock that were converted following June 30, 2020, with such conversion given effect
in the pro forma calculation in the table above;
|
|
|
|
|
●
|
3,040,272
shares of common stock issuable upon the exercise of warrants outstanding as of June 30, 2020 at an exercise price of $5.51
per share;
|
|
|
|
|
●
|
100,000
shares of common stock or Series C Convertible Preferred Stock, at the discretion of the holder, issuable upon the exercise
of warrants as of June 30, 2020 at an exercise price of $2.00 per share;
|
|
|
|
|
●
|
1,810,000
shares of common stock issuable upon conversion of Series E Convertible Preferred Stock issuable upon the exercise of warrants
outstanding as of June 30, 2020 at an exercise price of $2.50 per share;
|
|
|
|
|
●
|
430,763
shares of common stock reserved for future issuance under our 2014 Long-Term Incentive Plan; and
|
|
|
|
|
●
|
up
to 134,609 shares of common stock (or if the underwriters exercise their option to purchase additional shares of common
stock in full, up to 154,800 shares of common stock) issuable upon exercise of warrants with an exercise price of $1.25 per
share to be issued to the representative of the underwriters or its designees in connection with this offering.
|
To
the extent that outstanding options or warrants are exercised, you may experience further dilution. In addition, we may choose
to raise additional capital due to market conditions or strategic considerations even if we believe we have sufficient funds for
our current or future operating plans. To the extent that additional capital is raised through the sale of equity or convertible
debt securities, the issuance of these securities could result in further dilution to our stockholders.
UNDERWRITING
Pursuant
to the underwriting agreement with H.C. Wainwright & Co., LLC, or the representative, as representative of the underwriters
named below, we have agreed to issued and sell, and each underwriter has, severally and not jointly, agreed to purchase, the number
of shares of common stock listed opposite its name below, less the underwriting discount, on the closing date, subject to the
terms and conditions contained in the underwriting agreement. The underwriting agreement provides that the obligations of the
underwriters are subject to certain customary conditions precedent, representations and warranties contained therein.
Underwriter
|
|
|
Number
of Shares
|
|
H.C. Wainwright & Co., LLC
|
|
|
1,794,783
|
|
Pursuant
to the underwriting agreement, the underwriters have agreed to purchase all of the shares sold under the underwriting agreement
if any of these shares are purchased, other than those shares covered by the underwriters’ option to purchase additional
shares of common stock described below. The underwriters have advised us that they do not intend to confirm sales to any account
over which they exercise discretionary authority.
Discounts,
Commissions and Expenses
The
underwriters may offer the shares of common stock from time to time to purchasers directly or through agents, or through brokers
in brokerage transactions on Nasdaq, or to dealers in negotiated transactions or in a combination of such methods of sale, or
otherwise, at a fixed price or prices, which may be changed, or at market prices prevailing at the time of sale, at prices related
to such prevailing market prices or at negotiated prices, subject to receipt and acceptance by it and subject to its right to
reject any order in whole or in part. The difference between the price at which the underwriters purchase shares from us and the
price at which the underwriters resell such shares may be deemed underwriting compensation. If the underwriters effect such transactions
by selling shares of common stock to or through dealers, such dealers may receive compensation in the form of discounts, concessions
or commissions from the underwriter and/or purchasers of shares of common stock for whom they may act as agents or to whom they
may sell as principal. Any shares sold by the underwriters to securities dealers will be sold at the public offering price less
a selling concession not in excess of $0.045 per share.
The
underwriters are offering the shares, subject to prior sale, when, as and if issued to and accepted by them, subject to approval
of legal matters and other conditions specified in the underwriting agreement. The underwriters reserve the right to withdraw,
cancel or modify offers to the public and to reject orders in whole or in part.
We
have granted to the underwriters an option to purchase up to an additional 269,217 shares of common stock (up to 15% of the shares
of common stock in this offering) at the public offering price, less the underwriting discount. The option is exercisable for
30 days.
The
following table shows the public offering price, underwriting discount and proceeds, before expenses, to us. These amounts are
shown assuming both no exercise and full exercise of the underwriters’ option to purchase additional shares.
Per
Share
|
|
Total
Without Option
|
|
|
Total
with Option
|
|
Public offering price
|
|
$
|
1,794,783.00
|
|
|
$
|
2,064,000.00
|
|
Underwriting discounts and commissions
payable by us
|
|
$
|
134,608.73
|
|
|
$
|
154,800.00
|
|
Proceeds, before expenses, to us
|
|
$
|
1,660,174.27
|
|
|
$
|
1,909,200.00
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In
addition, we have agreed to issue to the representative of the underwriters or its designees warrants, or the underwriter warrants,
to purchase up to 134,609 shares of common stock (or if the underwriters exercise their option to purchase additional shares
of common stock in full, up to 154,800 shares of common stock) (representing 7.5% of the aggregate number of shares of common
stock sold in this offering), at an exercise price of $1.25 per share (representing 125% of the public offering price for a share
of common stock to be sold in this offering). The underwriter warrants will be exercisable immediately and for five years from
the commencement of the sales of this offering.
We
have also agreed to pay the representative a management fee equal to 1% of the aggregate gross proceeds in this offering. We have
agreed to reimburse the expenses of the representative in the non-accountable sum of $50,000 in connection with this offering,
reimburse the expenses of the underwriter, including its legal fees, up to $75,000 in connection with this offering, and $12,900
for the clearing expenses of the representative in connection with this offering.
Tail
Financing Payments
In
the event that any investors that participate in this offering or were introduced to this offering by the representative and who
participated in the offering provide any capital to us in a public or private offering or capital-raising transaction within 9
months following the date of engagement of the representative, we shall pay the representative the cash and warrant compensation
provided above on the gross proceeds from such investors.
Indemnification
We
have agreed to indemnify the underwriters against certain liabilities, including civil liabilities under the Securities Act, or
to contribute to payments that the underwriters may be required to make in respect of those liabilities.
Lock-Up
Agreements
We
have agreed to not sell any shares of our common stock or any securities convertible into or exercisable or exchangeable into
share of common stock, subject to certain exceptions, for a period of 30 days after the date of this prospectus supplement unless
we obtain a prior written consent of the representative. This consent may be given at any time without public notice, and the
representative may consent in its sole discretion. The exceptions to the restriction include, among other things, issuance of
any shares of our capital stock or securities convertible into shares of our capital stock that are issued as consideration in
an acquisition, merger or similar strategic transaction approved by a majority of the disinterested directors, provided that such
securities are issued as “restricted securities” as defined in Rule 144 and carry no registration rights that require
or permit the filing of any registration statement in connection therewith within 30 days after the date of this prospectus, and
provided that any such issuance shall only be to a person providing us business synergies and additional benefits in addition
to the investment of funds, but shall not include a transaction in which we are issuing securities primarily for the purpose of
raising capital or to an entity whose primary business is investing in securities.
We
have also agreed for a period of one year following the closing date of this offering not to (i) issue or sell any debt or equity
securities that are convertible into, exchangeable or exercisable for, or include the right to receive, additional shares of common
stock either (A) at a conversion price, exercise price or exchange rate or other price that is based upon, and/or varies with,
the trading prices of or quotations for the common stock at any time after the initial issuance of such debt or equity securities
or (B) with a conversion, exercise or exchange price that is subject to being reset at some future date after the initial issuance
of such debt or equity security or upon the occurrence of specified or contingent events directly or indirectly related to the
business of the Company or the market for the common stock or (ii) enter into, or effect a transaction under, any agreement, including,
but not limited to, an equity line of credit, whereby we may issue securities at a future determined price, other than an “at
the market” offering with the representative of the underwriters as sales agent following 30 days after the date of this
prospectus.
Price
Stabilization, Short Positions and Penalty Bids
In
connection with this offering, the underwriters may engage in stabilizing transactions, overallotment transactions, syndicate
covering transactions and penalty bids in connection with our common stock.
Stabilizing
transactions permit bids to purchase shares of common stock so long as the stabilizing bids do not exceed a specified maximum.
Overallotment
transactions involve sales by the underwriter of shares of common stock in excess of the number of shares the underwriter is obligated
to purchase. This creates a syndicate short position which may be either a covered short position or a naked short position. In
a covered short position, the number of shares over-allotted by the underwriter is not greater than the number of shares that
it may purchase in the overallotment option. In a naked short position, the number of shares involved is greater than the number
of shares in the overallotment option. The underwriter may close out any short position by exercising its overallotment option
and/or purchasing shares in the open market.
Syndicate
covering transactions involve purchases of common stock in the open market after the distribution has been completed in order
to cover syndicate short positions. Such a naked short position would be closed out by buying securities in the open market. A
naked short position is more likely to be created if the underwriters are concerned that there could be downward pressure on the
price of the securities in the open market after pricing that could adversely affect investors who purchase in the offering.
Penalty
bids permit the underwriters to reclaim a selling concession from a syndicate member when the securities originally sold by the
syndicate member are purchased in a stabilizing or syndicate covering transaction to cover syndicate short positions.
These
stabilizing transactions, syndicate covering transactions and penalty bids may have the effect of raising or maintaining the market
price of our common stock or preventing or retarding a decline in the market price of our common stock. As a result, the price
of our common stock in the open market may be higher than it would otherwise be in the absence of these transactions. Neither
we nor the underwriters make any representation or prediction as to the effect that the transactions described above may have
on the price of our common stock. These transactions may be effected on Nasdaq, in the over-the-counter market or otherwise and,
if commenced, may be discontinued at any time.
In
connection with this offering, the underwriters also may engage in passive market making transactions in our common stock in accordance
with Regulation M during a period before the commencement of offers or sales of shares of our common stock in this offering and
extending through the completion of the distribution. In general, a passive market maker must display its bid at a price not in
excess of the highest independent bid for that security. However, if all independent bids are lowered below the passive market
maker’s bid that bid must then be lowered when specific purchase limits are exceeded. Passive market making may stabilize
the market price of the securities at a level above that which might otherwise prevail in the open market and, if commenced, may
be discontinued at any time.
Electronic
Distribution
A
prospectus in electronic format may be made available on the websites maintained by the underwriters, if any, participating in
this offering and the underwriter may distribute prospectuses electronically. Other than the prospectus in electronic format,
the information on these websites is not part of this prospectus or the registration statement of which this prospectus form a
part, has not been approved or endorsed by us or the underwriters, and should not be relied upon by investors.
Other
Relationships
From
time to time, certain of the underwriter and their affiliates have provided, and may provide in the future, various advisory,
investment and commercial banking and other services to us in the ordinary course of business, for which they have received and
may continue to receive customary fees and commissions. H.C. Wainwright & Co., LLC served as our exclusive underwriter in
connection with the August 2020 Offering, for which it received compensation.
Transfer
Agent
The
transfer agent and registrar for our common stock is VStock Transfer, LLC.
Nasdaq
listing
Our
shares of common stock are listed on Nasdaq under the symbol “NAOV.”
LEGAL
MATTERS
The
validity of the common stock being offered hereby will be passed upon by Haynes and Boone, LLP, New York, New York. Dentons US
LLP, New York, New York is acting as counsel for the underwriters in connection with certain legal matters related to this offering.
EXPERTS
The
consolidated financial statements of the Company and its subsidiary as of December 31, 2019, and December 31, 2018, and for each
of the two years in the period ended December 31, 2019, included in the Annual Report on Form 10-K for the year ended December
31, 2019, and incorporated in this prospectus supplement by reference, have been so incorporated in reliance on the report (which
contains an explanatory paragraph relating to the Company’s ability to continue as a going concern as described in Note
2 to the financial statements) of Marcum LLP, an independent registered public accounting firm, given on the authority of said
firm as experts in auditing and accounting.
WHERE
YOU CAN FIND MORE INFORMATION
We
have filed with the SEC a registration statement on Form S-3 under the Securities Act with respect to the common stock offered
by this prospectus supplement and the accompanying prospectus. This prospectus supplement, filed as part of the registration statement,
does not contain all the information set forth in the registration statement and its exhibits and schedules, portions of which
have been omitted as permitted by the rules and regulations of the SEC. For further information about us, we refer you to the
registration statement and to its exhibits and schedules.
We
file annual, quarterly and current reports and other information with the SEC. The SEC maintains an internet website at www.sec.gov
that contains periodic and current reports, proxy and information statements, and other information regarding registrants
that are filed electronically with the SEC.
These
documents are also available, free of charge, through the Investors section of our website, which is located at www.nanovibronix.com.
Information contained on our website is not incorporated by reference into this prospectus supplement or the accompanying prospectus
and you should not consider information on our website to be part of this prospectus supplement or the accompanying prospectus.
INCORPORATION
BY REFERENCE
The
SEC allows us to “incorporate by reference” information that we file with it. Incorporation by reference allows us
to disclose important information to you by referring you to those other documents. The information incorporated by reference
is an important part of this prospectus supplement and the accompanying prospectus, and information that we file later with the
SEC will automatically update and supersede this information. We filed a registration statement on Form S-3 under the Securities
Act with the SEC with respect to the securities being offered pursuant to this prospectus supplement and the accompanying prospectus.
This prospectus supplement and the accompanying prospectus omit certain information contained in the registration statement, as
permitted by the SEC. You should refer to the registration statement, including the exhibits thereto, for further information
about us and the securities being offered pursuant to this prospectus supplement and the accompanying prospectus. Statements in
this prospectus supplement and the accompanying prospectus regarding the provisions of certain documents filed with, or incorporated
by reference in, the registration statement are not necessarily complete and each statement is qualified in all respects by that
reference. Copies of all or any part of the registration statement, including the documents incorporated by reference or the exhibits,
may be obtained upon payment of the prescribed rates at the offices of the SEC listed above in “Where You Can Find More
Information.” The documents we are incorporating by reference are:
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Annual Report on Form
10-K for the fiscal year ended December 31, 2019, filed with the Securities and Exchange Commission on May 20, 2020;
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Our
definitive Proxy Statement on Schedule
14A, filed with the Securities and Exchange Commission on June 15, 2020;
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Our
Quarterly Report on Form
10-Q for the quarter ended March 31, 2020, filed with the Securities and Exchange Commission on July 6, 2020;
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Our
Quarterly Report on Form
10-Q for the quarter ended June 30, 2020, filed with the Securities and Exchange Commission on August 19, 2020, as amended
by Amendment No.1 on Form
10-Q/A filed with the Securities and Exchange Commission on August 24, 2020;
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Our
Current Report on Form
8-K, filed with the Securities and Exchange Commission on March 30, 2020, as amended on April 3, 2020;
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Our
Current Report on Form
8-K, filed with the Securities and Exchange Commission on April 7, 2020;
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Our
Current Report on Form
8-K, filed with the Securities and Exchange Commission on April 29, 2020;
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Our
Current Report on Form
8-K, filed with the Securities and Exchange Commission on May 15, 2020;
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Our
Current Report on Form
8-K, filed with the Securities and Exchange Commission on June 3, 2020;
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Our
Current Report on Form
8-K, filed with the Securities and Exchange Commission on June 11, 2020;
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Our
Current Report on
Form 8-K, filed with the Securities and Exchange Commission on June 26, 2020;
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Our
Current Report on Form
8-K, filed with the Securities and Exchange Commission on July 8, 2020;
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Our
Current Report on Form
8-K, filed with the Securities and Exchange Commission on August 7, 2020;
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Our
Current Report on Form
8-K, filed with the Securities and Exchange Commission on August 11, 2020;
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Our
Current Report on Form
8-K, filed with the Securities and Exchange Commission on August 26, 2020;
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Our
Current Report on Form
8-K, filed with the Securities and Exchange Commission on September 22, 2020; and
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The
description of our common stock, which is contained in our registration statement on Form
8-A, filed with the Securities and Exchange Commission on October 19, 2017, as updated or amended in any amendment or
report filed for such purpose, as supplemented and amended by the description of our common stock contained in Exhibit 4.11
to our Annual Report on Form 10-K for the fiscal year ended December 31, 2019, filed with the Securities and Exchange Commission
on May 20, 2020.
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In
addition, all documents (other than current reports furnished under Item 2.02 or Item 7.01 of Form 8-K and exhibits filed in such
forms that are related to such items unless such Form 8-K expressly provides to the contrary) subsequently filed by us pursuant
to Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934, as amended, before the date our offering is terminated
or completed are deemed to be incorporated by reference into, and to be a part of, this prospectus supplement and the accompanying
prospectus.
Any
statement contained in this prospectus supplement and the accompanying prospectus, or any free writing prospectus provided in
connection with this offering or in a document incorporated or deemed to be incorporated by reference into this prospectus supplement
and the accompanying prospectus will be deemed to be modified or superseded for purposes of this prospectus supplement and the
accompanying prospectus to the extent that a statement contained in this prospectus supplement and the accompanying prospectus,
or any free writing prospectus provided in connection with this offering or any other subsequently filed document that is deemed
to be incorporated by reference into this prospectus supplement and the accompanying prospectus modifies or supersedes the statement.
Any statement so modified or superseded will not be deemed, except as so modified or superseded, to constitute a part of this
prospectus supplement and the accompanying prospectus.
Upon
written or oral request, we will provide you without charge, a copy of any or all of the documents incorporated by reference,
other than exhibits to those documents unless the exhibits are specifically incorporated by reference in the documents. Any such
request should be addressed to us at: 525 Executive Boulevard, Elmsford, New York 10523, Attention: James Cardwell, Chief Financial
Officer, or made by phone at (914) 233-3004. You should rely only on information contained in, or incorporated by reference into,
this prospectus supplement and the accompanying prospectus or any free writing prospectus provided in connection with this offering.
We have not authorized anyone to provide you with information different from that contained in this prospectus supplement and
the accompanying prospectus or any free writing prospectus provided in connection with this offering or incorporated by reference
in this prospectus supplement and the accompanying prospectus. We are not making offers to sell the securities in any jurisdiction
in which such an offer or solicitation is not authorized or to anyone to whom it is unlawful to make such offer or solicitation.
PROSPECTUS
NanoVibronix,
Inc.
$50,000,000
Common
Stock
Preferred
Stock
Warrants
Units
We
may offer and sell from time to time, in one or more series or issuances and on terms that we will determine at the time of the
offering, any combination of the securities described in this prospectus, up to an aggregate amount of $50,000,000.
We
will provide specific terms of any offering in a supplement to this prospectus. Any prospectus supplement may also add, update,
or change information contained in this prospectus. You should carefully read this prospectus and the applicable prospectus supplement
as well as the documents incorporated or deemed to be incorporated by reference in this prospectus before you purchase any of
the securities offered hereby.
These
securities may be offered and sold in the same offering or in separate offerings; to or through underwriters, dealers, and agents;
or directly to purchasers. The names of any underwriters, dealers, or agents involved in the sale of our securities, their compensation
and any over-allotment options held by them will be described in the applicable prospectus supplement. See “Plan of Distribution.”
Our
common stock is listed on the Nasdaq Capital Market under the symbol “NAOV.” On July 17, 2020, the last reported sale
price of our common stock as reported on the Nasdaq Capital Market was $1.80 per share. We recommend that you obtain current market
quotations for our common stock prior to making an investment decision. We will provide information in any applicable prospectus
supplement regarding any listing of securities other than shares of our common stock on any securities exchange.
As
of July 20, 2019, the aggregate market value of our outstanding common stock held by non-affiliates, or the public float, was
approximately $11,067,350, which was calculated based on 4,498,924 shares of our outstanding common stock held by non-affiliates
and a price of $2.46 per share, the last reported sale price for our common stock on June 16, 2020. We have not offered any securities
pursuant to General Instruction I.B.6 of Form S-3 during the 12 calendar months prior to and including the date of this prospectus.
You
should carefully read this prospectus, any prospectus supplement relating to any specific offering of securities, and all information
incorporated by reference herein and therein.
Investing
in our securities involves a high degree of risk. These risks are discussed in this prospectus under “Risk Factors”
beginning on page 4 and in the documents incorporated by reference into this prospectus.
Neither
the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or
passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.
The
date of this prospectus is August 11, 2020
TABLE
OF CONTENTS
ABOUT
THIS PROSPECTUS
This
prospectus is part of a registration statement on Form S-3 that we filed with the Securities and Exchange Commission using a “shelf”
registration process. Under this shelf process, we may, from time to time, sell any combination of the securities described in
this prospectus in one or more offerings up to a total amount of $50,000,000.
This
prospectus provides you with a general description of the securities we may offer. Each time we sell securities, we will provide
a prospectus supplement that will contain specific information about the terms of that offering. The prospectus supplement may
also add to, update or change information contained in the prospectus and, accordingly, to the extent inconsistent, information
in this prospectus is superseded by the information in the prospectus supplement.
The
prospectus supplement to be attached to the front of this prospectus may describe, as applicable: the terms of the securities
offered; the public offering price; the price paid for the securities; net proceeds; and the other specific terms related to the
offering of the securities.
You
should only rely on the information contained or incorporated by reference in this prospectus and any prospectus supplement or
issuer free writing prospectus relating to a particular offering. No person has been authorized to give any information or make
any representations in connection with this offering other than those contained or incorporated by reference in this prospectus,
any accompanying prospectus supplement and any related issuer free writing prospectus in connection with the offering described
herein and therein, and, if given or made, such information or representations must not be relied upon as having been authorized
by us. Neither this prospectus nor any prospectus supplement nor any related issuer free writing prospectus shall constitute an
offer to sell or a solicitation of an offer to buy offered securities in any jurisdiction in which it is unlawful for such person
to make such an offering or solicitation. This prospectus does not contain all of the information included in the registration
statement. For a more complete understanding of the offering of the securities, you should refer to the registration statement,
including its exhibits.
You
should read the entire prospectus and any prospectus supplement and any related issuer free writing prospectus, as well as the
documents incorporated by reference into this prospectus or any prospectus supplement or any related issuer free writing prospectus,
before making an investment decision. Neither the delivery of this prospectus or any prospectus supplement or any issuer free
writing prospectus nor any sale made hereunder shall under any circumstances imply that the information contained or incorporated
by reference herein or in any prospectus supplement or issuer free writing prospectus is correct as of any date subsequent to
the date hereof or of such prospectus supplement or issuer free writing prospectus, as applicable. You should assume that the
information appearing in this prospectus, any prospectus supplement or any document incorporated by reference is accurate only
as of the date of the applicable documents, regardless of the time of delivery of this prospectus or any sale of securities. Our
business, financial condition, results of operations and prospects may have changed since that date.
PROSPECTUS
SUMMARY
This
summary provides an overview of selected information contained elsewhere or incorporated by reference in this prospectus and does
not contain all of the information you should consider before investing in our securities. You should carefully read the prospectus,
the information incorporated by reference and the registration statement of which this prospectus is a part in their entirety
before investing in our securities, including the information discussed under “Risk Factors” in this prospectus and
the documents incorporated by reference and our financial statements and related notes that are incorporated by reference in this
prospectus. As used in this prospectus, unless the context otherwise indicates, the terms “we,” “our,”
“us,” or “the Company” refer to NanoVibronix, Inc., a Delaware corporation, and its subsidiaries taken
as a whole.
Overview
We
are a medical device company focusing on noninvasive biological response-activating devices that target wound healing and pain
therapy and can be administered at home, without the assistance of medical professionals. Our primary products, which are in various
stages of clinical and market development, currently consist of:
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UroShield™,
an ultrasound-based product that is designed to prevent bacterial colonization and biofilm in urinary catheters, increase
antibiotic efficacy and decrease pain and discomfort associated with urinary catheter use.
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PainShield™,
a patch-based therapeutic ultrasound technology to treat pain, muscle spasm and joint contractures by delivering a localized
ultrasound effect to treat pain and induce soft tissue healing in a targeted area; and
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WoundShield™,
a patch-based therapeutic ultrasound device intended to facilitate tissue regeneration and wound healing by using ultrasound
to increase local capillary perfusion and tissue oxygenation.
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Each
of our PainShield, UroShield, and WoundShield products employs a small, disposable transducer that transmits low frequency, low
intensity ultrasound acoustic waves that seek to repair and regenerate tissue, musculoskeletal and vascular structures, and decrease
biofilm formation on urinary catheters and associated urinary tract infections. Through their size, effectiveness and ease of
use, these products are intended to eliminate the need for technicians and medical personnel to manually administer ultrasound
treatment through large transducers, thereby promoting patient independence and enabling more cost-effective home-based care.
PainShield
is currently cleared for marketing in the United States by the U.S. Food and Drug Administration although to date there has not
been a significant sales and marketing effort. All three of our products have CE Mark approval in the European Union, and a certificate
allowing us to sell PainShield, UroShield and WoundShield in Israel. We are able to sell PainShield, UroShield and WoundShield
in India and Ecuador based on our CE Mark. We have consummated sales of PainShield and UroShield in the relevant markets, although
to date sales have been minimal; WoundShield has not generated significant revenue to date. Outside of the United States we generally
apply, through our distributor, for approval in a particular country for a particular product only when we have a distributor
in place with respect to such product.
Implications
of being an Emerging Growth Company
As
a company with less than $1.07 billion in revenue during our last fiscal year, we qualify as an “emerging growth company”
as defined in the Jumpstart Our Business Startups Act (the “JOBS Act”) enacted in April 2012. An “emerging growth
company” may take advantage of exemptions from some of the reporting requirements that are otherwise applicable to public
companies. These exceptions include:
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being
permitted to present only two years of audited financial statements and only two years of related Management’s Discussion
and Analysis of Financial Condition and Results of Operations in this prospectus;
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not
being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, as amended
(the “Sarbanes-Oxley Act”);
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reduced
disclosure obligations regarding executive compensation in our periodic reports, proxy statements and registration statements;
and
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exemptions
from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden
parachute payments not previously approved.
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We
may take advantage of these provisions until the last day of our fiscal year following the fifth anniversary of the closing of
our initial public offering. However, if certain events occur prior to the end of such five-year period, including if we become
a “large accelerated filer,” our annual gross revenue exceeds $1.07 billion or we issue more than $1.0 billion of
non-convertible debt in any three-year period, we will cease to be an emerging growth company prior to the end of such five-year
period.
In
addition, the JOBS Act provides that an emerging growth company can take advantage of an extended transition period for complying
with new or revised accounting standards. We have elected to avail ourselves of this exemption.
Recent
Events and Developments
In
December 2019, a strain of coronavirus (“COVID-19”) was reported to have surfaced in Wuhan, China, and has spread
globally, resulting in government-imposed quarantines, travel restrictions and other public health safety measures in China and
other affected countries. The ongoing COVID-19 pandemic has and may continue to adversely impact our business, as our operations
are based in and rely on third parties located in countries affected by the pandemic. Our third-party manufacturer, which is based
in China, temporarily shut down for sixty days due to the outbreak and only became fully operational in April 2020 which led to
a significant delay in the production of goods needed to fulfill our sales orders which were scheduled to be fulfilled in our
first quarter on 2020. We were able to fulfill these orders in the second quarter of 2020. Additionally, the notified regulatory
body we rely on to obtain European CE approval is located in Italy and was shut down for approximately six weeks in March - April
2020, which delayed our submission for CE mark approval for the year 2020. The CE Mark was subsequently approved in April 2020.
The various precautionary measures taken by many governmental authorities around the world in order to limit the spread of COVID-19
has had and may continue to have an adverse effect on the global markets and global economy, including on the availability and
pricing of employees, resources, materials, manufacturing and delivery efforts and other aspects of the global economy. The financial
downturn has compelled us to furlough or reduce working hours for much of our operating staff, and has forced remaining staff
as well as third-party contractors, and our clients may encounter cash-flow issues that will delay their payments to us. In addition,
remaining staff members have been forced to operate remotely from their homes, which is continuing, resulting in delays in obtaining
certain financial records. We also rely on third-party professionals to provide services such as the preparation of our financial
statements and to conduct audits, and many of these parties have been affected by government-imposed precautionary measures, thereby
delaying our receipt of these services. Such government-imposed precautionary measures may have been relaxed in certain countries
or states, but there is no assurance that more strict measures will be put in place again due to a resurgence in COVID-19 cases.
Therefore, the COVID-19 pandemic has and may again disrupt production and cause delays in the supply and delivery of our products,
may continue to affect our operation, may further divert the attention and efforts of the medical community to coping with COVID-19
and disrupt the marketplace in which we operate and may have a material adverse effect on our operations. Assessment of the complete
extent of the impact of COVID-19 on our results will depend on future developments, which are highly uncertain and cannot be predicted,
including new information which may emerge concerning the severity of COVID-19 and the actions to contain COVID-19 or treat its
impact, among others. The continuation of the COVID-19 pandemic could materially disrupt our business and operations, hamper our
ability to raise additional funds or sell or securities, continue to slow down the overall economy, curtail consumer spending,
interrupt our sources of supply, and make it hard to adequately staff our operations.
Corporate
Information
We
were organized in the State of Delaware on October 20, 2003. Our principal executive offices are located at 525 Executive Boulevard,
Elmsford, New York 10523. Our telephone number is (914) 233-3004. Our website address is www.nanovibronix.com. Information accessed
through our website is not incorporated into this prospectus and is not a part of this prospectus.
The
Securities We May Offer
We
may offer up to $50,000,000 of common stock, preferred stock, warrants and/or units in one or more offerings and in any combination.
This prospectus provides you with a general description of the securities we may offer. A prospectus supplement, which we will
provide each time we offer securities, will describe the specific amounts, prices and terms of these securities.
Common
Stock
We
may issue shares of our common stock from time to time. The holders of common stock are entitled to one vote per share. Our certificate
of incorporation does not provide for cumulative voting. All of our directors hold office for one-year terms until the election
and qualification of their successors. The holders of our common stock are entitled to receive ratably such dividends, if any,
as may be declared by the board of directors out of legally available funds. Upon liquidation, dissolution or winding-up, the
holders of our common stock are entitled to share ratably in all assets that are legally available for distribution. The holders
of our common stock have no preemptive, subscription, redemption or conversion rights. The rights, preferences and privileges
of holders of our common stock are subject to, and may be adversely affected by, the rights of the holders of any series of preferred
stock, which may be designated solely by action of the board of directors and issued in the future.
Preferred
Stock
We
may issue shares of our preferred stock from time to time, in one or more series. Our board of directors will determine the rights,
preferences, privileges and restrictions of the preferred stock, including dividend rights, conversion rights, voting rights,
terms of redemption, liquidation preferences, sinking fund terms and the number of shares constituting any series or the designation
of such series, without any further vote or action by stockholders. Convertible preferred stock will be convertible into our common
stock or exchangeable for our other securities. Conversion may be mandatory or at your option or both and would be at prescribed
conversion rates.
If
we sell any series of preferred stock under this prospectus and applicable prospectus supplements, we will fix the rights, preferences,
privileges and restrictions of the preferred stock of such series in the certificate of designation relating to that series. We
will file as an exhibit to the registration statement of which this prospectus is a part, or will incorporate by reference from
reports that we file with the Securities and Exchange Commission, the form of any certificate of designation that describes the
terms of the series of preferred stock we are offering before the issuance of the related series of preferred stock. We urge you
to read the applicable prospectus supplement related to the series of preferred stock being offered, as well as the complete certificate
of designation that contains the terms of the applicable series of preferred stock.
Warrants
We
may issue warrants for the purchase of common stock or preferred stock in one or more series. We may issue warrants independently
or together with common stock or preferred stock, and the warrants may be attached to or separate from these securities. We will
evidence each series of warrants by warrant certificates that we will issue under a separate agreement. We may enter into warrant
agreements with a bank or trust company that we select to be our warrant agent. We will indicate the name and address of the warrant
agent in the applicable prospectus supplement relating to a particular series of warrants.
In
this prospectus, we have summarized certain general features of the warrants. We urge you, however, to read the applicable prospectus
supplement related to the particular series of warrants being offered, as well as the warrant agreements and warrant certificates
that contain the terms of the warrants. We will file as exhibits to the registration statement of which this prospectus is a part,
or will incorporate by reference from reports that we file with the Securities and Exchange Commission, the form of warrant agreement
or warrant certificate containing the terms of the warrants we are offering before the issuance of the warrants.
Units
We
may issue units consisting of common stock, preferred stock and/or warrants for the purchase of common stock or preferred stock
in one or more series. In this prospectus, we have summarized certain general features of the units. We urge you, however, to
read the applicable prospectus supplement related to the series of units being offered, as well as the unit agreements that contain
the terms of the units. We will file as exhibits to the registration statement of which this prospectus is a part, or will incorporate
by reference reports that we file with the Securities and Exchange Commission, the form of unit agreement and any supplemental
agreements that describe the terms of the series of units we are offering before the issuance of the related series of units.
RISK
FACTORS
An
investment in our securities involves a high degree of risk. The prospectus supplement applicable to each offering of our securities
will contain a discussion of the risks applicable to an investment in our securities. Before deciding whether to invest in our
securities, you should carefully consider the specific factors discussed under the heading “Risk Factors” in the applicable
prospectus supplement, together with all of the other information contained or incorporated by reference in the prospectus supplement
or appearing or incorporated by reference in this prospectus. You should also consider the risks, uncertainties and assumptions
discussed under Item 1A, “Risk Factors,” in our most recent Annual Report on Form 10-K or any updates in our Quarterly
Reports on Form 10-Q, together with all other information appearing in or incorporated by reference into this prospectus or the
applicable prospectus supplement, before deciding whether to purchase any securities being offered. If any of these risks actually
occurs, our business, business prospects, financial condition or results of operations could be seriously harmed. This could cause
the trading price of our common stock to decline, resulting in a loss of all or part of your investment. Please also read carefully
the section below entitled “Special Note Regarding Forward-Looking Statements.”
SPECIAL
NOTE REGARDING FORWARD-LOOKING STATEMENTS
This
prospectus, each prospectus supplement and the information incorporated by reference in this prospectus and each prospectus supplement
contain “forward-looking statements,” which include information relating to future events, future financial performance,
strategies, expectations, competitive environment and regulation. Words such as “may,” “should,” “could,”
“would,” “predicts,” “potential,” “continue,” “expects,” “anticipates,”
“future,” “intends,” “plans,” “believes,” “estimates,” and similar
expressions, as well as statements in future tense, are intended to identify forward-looking statements. Forward-looking statements
should not be read as a guarantee of future performance or results and may not be accurate indications of when such performance
or results will actually be achieved. Forward-looking statements are based on information we have when those statements are made
or our management’s good faith belief as of that time with respect to future events, and are subject to risks and uncertainties
that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking
statements. Important factors that could cause such differences include, but are not limited to:
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Our
ability to continue as a going concern.
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The
geographic, social and economic impact of COVID-19 on the Company’s business operations.
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The
timing of clinical studies and eventual U.S. Food and Drug Administration approval of our other product candidates.
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Regulatory
actions that could adversely affect the price of or demand for our approved products.
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Market
acceptance of existing and new products.
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Favorable
or unfavorable decisions about our products from government regulators, insurance companies or other third-party payers.
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Our
ability to regain compliance with the continued listing requirements of the Nasdaq Capital Market and the risk that our common
stock will be delisted if we cannot do so.
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Our
intellectual property portfolio.
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Our
ability to recruit and retain qualified regulatory and research and development personnel.
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The
impact of cybersecurity risks and incidents and the related actual or potential costs and consequences of such risks and incidents,
including costs to limit such risks.
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Unforeseen
changes in healthcare reimbursement for any of our approved products.
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Lack
of financial resources to adequately support our operations.
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Difficulties
in maintaining commercial scale manufacturing capacity and capability.
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Our
ability to generate internal growth.
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Changes
in our relationship with key collaborators.
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Changes
in the market valuation or earnings of our competitors or companies viewed as similar to us.
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Our
failure to comply with regulatory guidelines.
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Uncertainty
in industry demand and patient wellness behavior.
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General
economic conditions and market conditions in the medical device industry.
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Future
sales of large blocks of our common stock, which may adversely impact our stock price.
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Depth
of the trading market in our common stock.
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You
should read this prospectus, the applicable prospectus supplement and any related free-writing prospectus and the documents incorporated
by reference in this prospectus with the understanding that our actual future results, levels of activity, performance and events
and circumstances may be materially different from what we expect. The forward-looking statements contained or incorporated by
reference in this prospectus or any prospectus supplement are expressly qualified in their entirety by this cautionary statement.
We do not undertake any obligation to publicly update any forward-looking statement to reflect events or circumstances after the
date on which any such statement is made or to reflect the occurrence of unanticipated events.
USE
OF PROCEEDS
Unless
we specify another use in the applicable prospectus supplement, we will use the net proceeds from the sale of the securities offered
by us for general corporate purposes, including funding of our development programs, commercial planning and sales and marketing
expenses, general and administrative expenses and working capital.
Investors
are cautioned, however, that expenditures may vary substantially from these uses. Investors will be relying on the judgment of
our management, who will have broad discretion regarding the application of the proceeds of this offering. The amounts and timing
of our actual expenditures will depend upon numerous factors, including the amount of cash generated by our operations, the amount
of competition and other operational factors. We may find it necessary or advisable to use portions of the proceeds from this
offering for other purposes.
From
time to time, we evaluate these and other factors and we anticipate continuing to make such evaluations to determine if the existing
allocation of resources, including the proceeds of this offering, is being optimized. Circumstances that may give rise to a change
in the use of proceeds include:
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a
change in development plan or strategy;
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the
addition of new products or applications;
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technical
delays;
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delays
or difficulties with our clinical trials;
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negative
results from our clinical trials;
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difficulty
obtaining U.S. Food and Drug Administration approval;
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failure
to achieve sales as anticipated; and
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the
availability of other sources of cash including cash flow from operations and new bank debt financing arrangements, if any.
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Pending
other uses, we intend to invest the proceeds to us in investment-grade, interest-bearing securities such as money market funds,
certificates of deposit, or direct or guaranteed obligations of the U.S. government, or hold as cash. We cannot predict whether
the proceeds invested will yield a favorable, or any, return.
DESCRIPTION
OF CAPITAL STOCK
The
following description of common stock and preferred stock summarizes the material terms and provisions of the common stock and
preferred stock that we may offer under this prospectus, but is not complete. For the complete terms of our common stock and preferred
stock, please refer to our amended and restated certificate of incorporation, as amended, any certificates of designation for
our preferred stock, and our amended and restated bylaws, as may be amended from time to time. While the terms we have summarized
below will apply generally to any future common stock or preferred stock that we may offer, we will describe the specific terms
of any series of preferred stock in more detail in the applicable prospectus supplement. If we so indicate in a prospectus supplement,
the terms of any preferred stock we offer under that prospectus supplement may differ from the terms we describe below.
We
have authorized 31,000,000 shares of capital stock, par value $0.001 per share, of which 20,000,000 are shares of common stock
and 11,000,000 are shares of “blank check” preferred stock. On July 17, 2020, there were 4,613,764 shares of common
stock, 2,993,142 shares of our Series C Convertible Preferred Stock (“Series C Preferred Stock”), 304 shares of our
Series D Convertible Preferred Stock (“Series D Preferred Stock”), and 1,415,000 shares of our Series E Convertible
Preferred Stock (“Series E Preferred Stock”) issued and outstanding. We currently have 3,000,000 shares of preferred
stock designated as Series C Preferred Stock, 506 shares of preferred stock designated as Series D Preferred Stock, and 1,999,494
shares of preferred stock designated as Series E Preferred Stock. The authorized and unissued shares of common stock and the authorized
and undesignated shares of preferred stock are available for issuance without further action by our stockholders, unless such
action is required by applicable law or the rules of any stock exchange on which our securities may be listed. Unless approval
of our stockholders is so required, our board of directors does not intend to seek stockholder approval for the issuance and sale
of our common stock or preferred stock.
Common
Stock
The
holders of common stock are entitled to one vote per share. Our certificate of incorporation does not provide for cumulative voting.
All of our directors hold office for one-year terms until the election and qualification of their successors. The holders of our
common stock are entitled to receive ratably such dividends, if any, as may be declared by the board of directors out of legally
available funds. Upon liquidation, dissolution or winding-up, the holders of our common stock are entitled to share ratably in
all assets that are legally available for distribution. The holders of our common stock have no preemptive, subscription, redemption
or conversion rights. The rights, preferences and privileges of holders of our common stock are subject to, and may be adversely
affected by, the rights of the holders of any series of preferred stock, which may be designated solely by action of the board
of directors and issued in the future.
The
transfer agent and registrar for our common stock is VStock Transfer, LLC. The transfer agent’s address is 18 Lafayette
Place, Woodmere, New York 11598. Our common stock is listed on the Nasdaq Capital Market under the symbol “NAOV.”
Preferred
Stock
The
board of directors is authorized, subject to any limitations prescribed by law, without further vote or action by the stockholders,
to issue from time to time shares of preferred stock in one or more series. Each such series of preferred stock shall have such
number of shares, designations, preferences, voting powers, qualifications, and special or relative rights or privileges as shall
be determined by the board of directors, which may include, among others, dividend rights, voting rights, liquidation preferences,
conversion rights and preemptive rights. Issuance of preferred stock by our board of directors may result in such shares having
dividend and/or liquidation preferences senior to the rights of the holders of our common stock and could dilute the voting rights
of the holders of our common stock.
Prior
to the issuance of shares of each series of preferred stock, the board of directors is required by the Delaware General Corporation
Law and our certificate of incorporation to adopt resolutions and file a certificate of designation with the Secretary of State
of the State of Delaware. The certificate of designation fixes for each class or series the designations, powers, preferences,
rights, qualifications, limitations and restrictions, including, but not limited to, some or all of the following:
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the
number of shares constituting that series and the distinctive designation of that series, which number may be increased or
decreased (but not below the number of shares then outstanding) from time to time by action of the board of directors;
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the
dividend rate and the manner and frequency of payment of dividends on the shares of that series, whether dividends will be
cumulative, and, if so, from which date;
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whether
that series will have voting rights, in addition to any voting rights provided by law, and, if so, the terms of such voting
rights;
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whether
that series will have conversion privileges, and, if so, the terms and conditions of such conversion, including provision
for adjustment of the conversion rate in such events as the board of directors may determine;
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whether
or not the shares of that series will be redeemable, and, if so, the terms and conditions of such redemption;
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whether
that series will have a sinking fund for the redemption or purchase of shares of that series, and, if so, the terms and amount
of such sinking fund;
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whether
or not the shares of the series will have priority over or be on a parity with or be junior to the shares of any other series
or class in any respect;
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the
rights of the shares of that series in the event of voluntary or involuntary liquidation, dissolution or winding up of the
corporation, and the relative rights or priority, if any, of payment of shares of that series; and
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any
other relative rights, preferences and limitations of that series.
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Once
designated by our board of directors, each series of preferred stock may have specific financial and other terms that will be
described in a prospectus supplement. The description of the preferred stock that is set forth in any prospectus supplement is
not complete without reference to the documents that govern the preferred stock. These include our certificate of incorporation
and any certificates of designation that our board of directors may adopt.
All
shares of preferred stock offered hereby will, when issued, be fully paid and nonassessable, including shares of preferred stock
issued upon the exercise of preferred stock warrants or subscription rights, if any.
Although
our board of directors has no intention at the present time of doing so, it could authorize the issuance of a series of preferred
stock that could, depending on the terms of such series, impede the completion of a merger, tender offer or other takeover attempt.
Delaware
Anti-Takeover Law, Provisions of our Certificate of Incorporation and Bylaws
Delaware
Anti-Takeover Law
We
are subject to Section 203 of the Delaware General Corporation Law. Section 203 generally prohibits a public Delaware corporation
from engaging in a “business combination” with an “interested stockholder” for a period of three years
after the date of the transaction in which the person became an interested stockholder, unless:
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prior
to the date of the transaction, the board of directors of the corporation approved either the business combination or the
transaction which resulted in the stockholder becoming an interested stockholder;
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the
interested stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced,
excluding for purposes of determining the number of shares outstanding (i) shares owned by persons who are directors and also
officers and (ii) shares owned by employee stock plans in which employee participants do not have the right to determine confidentially
whether shares held subject to the plan will be tendered in a tender or exchange offer; or
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on
or subsequent to the date of the transaction, the business combination is approved by the board and authorized at an annual
or special meeting of stockholders, and not by written consent, by the affirmative vote of at least 66 2/3% of the outstanding
voting stock which is not owned by the interested stockholder.
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Section
203 defines a business combination to include:
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any
merger or consolidation involving the corporation and the interested stockholder;
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any
sale, transfer, pledge or other disposition involving the interested stockholder of 10% or more of the assets of the corporation;
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subject
to exceptions, any transaction that results in the issuance or transfer by the corporation of any stock of the corporation
to the interested stockholder; or
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the
receipt by the interested stockholder of the benefit of any loans, advances, guarantees, pledges or other financial benefits
provided by or through the corporation.
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In
general, Section 203 defines an “interested stockholder” as any entity or person beneficially owning 15% or more of
the outstanding voting stock of the corporation and any entity or person affiliated with, or controlling, or controlled by, the
entity or person. The term “owner” is broadly defined to include any person that, individually, with or through that
person’s affiliates or associates, among other things, beneficially owns the stock, or has the right to acquire the stock,
whether or not the right is immediately exercisable, under any agreement or understanding or upon the exercise of warrants or
options or otherwise or has the right to vote the stock under any agreement or understanding, or has an agreement or understanding
with the beneficial owner of the stock for the purpose of acquiring, holding, voting or disposing of the stock.
The
restrictions in Section 203 do not apply to corporations that have elected, in the manner provided in Section 203, not to be subject
to Section 203 of the Delaware General Corporation Law or, with certain exceptions, which do not have a class of voting stock
that is listed on a national securities exchange or held of record by more than 2,000 stockholders. Our certificate of incorporation
and bylaws do not opt out of Section 203.
Section
203 could delay or prohibit mergers or other takeover or change in control attempts with respect to us and, accordingly, may discourage
attempts to acquire us even though such a transaction may offer our stockholders the opportunity to sell their stock at a price
above the prevailing market price.
Certificate
of Incorporation and Bylaws
Provisions
of our certificate of incorporation and bylaws may delay or discourage transactions involving an actual or potential change in
our control or change in our management, including transactions in which stockholders might otherwise receive a premium for their
shares, or transactions that our stockholders might otherwise deem to be in their best interests. Therefore, these provisions
could adversely affect the price of our common stock. Among other things, our certificate of incorporation and bylaws:
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permit
our board of directors to issue up to 11,000,000 shares of preferred stock, without further action by the stockholders, with
any rights, preferences and privileges as they may designate, including the right to approve an acquisition or other change
in control;
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provide
that the authorized number of directors may be changed only by resolution of a majority of the total number of authorized
directors whether or not there exist any vacancies in previously authorized directorships (the “Whole Board”);
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provide
that all vacancies, including newly created directorships, may, except as otherwise required by law, be filled by the affirmative
vote of a majority of directors then in office, even if less than a quorum;
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do
not provide for cumulative voting rights (therefore allowing the holders of a majority of the shares of common stock entitled
to vote in any election of directors to elect all of the directors standing for election, if they should so choose);
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provide
that special meetings of our stockholders may be called only by a resolution adopted by a majority of the Whole Board; and
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set
forth an advance notice procedure with regard to the nomination, other than by or at the direction of our board of directors,
of candidates for election as directors and with regard to business to be brought before a meeting of stockholders.
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DESCRIPTION
OF WARRANTS
As
of July 17, 2020, there were outstanding warrants to purchase 1,871,605 shares of common stock, outstanding warrants to purchase
1,268,667 shares of common stock, shares of Series C Convertible Preferred Stock or a combination of common stock and Series C
Convertible Preferred Stock, and outstanding warrants to purchase 1,810,000 shares of Series E Convertible Preferred Stock.
We
may issue warrants for the purchase of common stock or preferred stock in one or more series. We may issue warrants independently
or together with common stock or preferred stock, and the warrants may be attached to or separate from these securities.
We
will evidence each series of warrants by warrant certificates that we may issue under a separate agreement. We may enter into
a warrant agreement with a warrant agent. Each warrant agent may be a bank that we select which has its principal office in the
United States. We may also choose to act as our own warrant agent. We will indicate the name and address of any such warrant agent
in the applicable prospectus supplement relating to a particular series of warrants.
We
will describe in the applicable prospectus supplement the terms of the series of warrants, including:
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the
offering price and aggregate number of warrants offered;
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if
applicable, the designation and terms of the securities with which the warrants are issued and the number of warrants issued
with each such security or each principal amount of such security;
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if
applicable, the date on and after which the warrants and the related securities will be separately transferable;
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in
the case of warrants to purchase common stock or preferred stock, the number or amount of shares of common stock or preferred
stock, as the case may be, purchasable upon the exercise of one warrant and the price at which and currency in which these
shares may be purchased upon such exercise;
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the
manner of exercise of the warrants, including any cashless exercise rights;
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the
warrant agreement under which the warrants will be issued;
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the
effect of any merger, consolidation, sale or other disposition of our business on the warrant agreement and the warrants;
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anti-dilution
provisions of the warrants, if any;
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the
terms of any rights to redeem or call the warrants;
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any
provisions for changes to or adjustments in the exercise price or number of securities issuable upon exercise of the warrants;
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the
dates on which the right to exercise the warrants will commence and expire or, if the warrants are not continuously exercisable
during that period, the specific date or dates on which the warrants will be exercisable;
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the
manner in which the warrant agreement and warrants may be modified;
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the
identities of the warrant agent and any calculation or other agent for the warrants;
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federal
income tax consequences of holding or exercising the warrants;
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the
terms of the securities issuable upon exercise of the warrants;
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any
securities exchange or quotation system on which the warrants or any securities deliverable upon exercise of the warrants
may be listed or quoted; and
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any
other specific terms, preferences, rights or limitations of or restrictions on the warrants.
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Before
exercising their warrants, holders of warrants will not have any of the rights of holders of the securities purchasable upon such
exercise, including, in the case of warrants to purchase common stock or preferred stock, the right to receive dividends, if any,
or, payments upon our liquidation, dissolution or winding up or to exercise voting rights, if any.
Exercise
of Warrants
Each
warrant will entitle the holder to purchase the securities that we specify in the applicable prospectus supplement at the exercise
price that we describe in the applicable prospectus supplement. Unless we otherwise specify in the applicable prospectus supplement,
holders of the warrants may exercise the warrants at any time up to 5:00 P.M. eastern time, the close of business, on the expiration
date that we set forth in the applicable prospectus supplement. After the close of business on the expiration date, unexercised
warrants will become void.
Holders
of the warrants may exercise the warrants by delivering the warrant certificate representing the warrants to be exercised together
with specified information, and paying the required exercise price by the methods provided in the applicable prospectus supplement.
We will set forth on the reverse side of the warrant certificate, and in the applicable prospectus supplement, the information
that the holder of the warrant will be required to deliver to the warrant agent.
Upon
receipt of the required payment and the warrant certificate properly completed and duly executed at the corporate trust office
of the warrant agent or any other office indicated in the applicable prospectus supplement, we will issue and deliver the securities
purchasable upon such exercise. If fewer than all of the warrants represented by the warrant certificate are exercised, then we
will issue a new warrant certificate for the remaining amount of warrants.
Enforceability
of Rights By Holders of Warrants
Any
warrant agent will act solely as our agent under the applicable warrant agreement and will not assume any obligation or relationship
of agency or trust with any holder of any warrant. A single bank or trust company may act as warrant agent for more than one issue
of warrants. A warrant agent will have no duty or responsibility in case of any default by us under the applicable warrant agreement
or warrant, including any duty or responsibility to initiate any proceedings at law or otherwise, or to make any demand upon us.
Any holder of a warrant may, without the consent of the related warrant agent or the holder of any other warrant, enforce by appropriate
legal action the holder’s right to exercise, and receive the securities purchasable upon exercise of, its warrants in accordance
with their terms.
Warrant
Agreement Will Not Be Qualified Under Trust Indenture Act
No
warrant agreement will be qualified as an indenture, and no warrant agent will be required to qualify as a trustee, under the
Trust Indenture Act. Therefore, holders of warrants issued under a warrant agreement will not have the protection of the Trust
Indenture Act with respect to their warrants.
Governing
Law
Unless
we provide otherwise in the applicable prospectus supplement, each warrant agreement and any warrants issued under the warrant
agreements will be governed by New York law.
DESCRIPTION
OF UNITS
We
may issue units comprised of one or more of the other securities described in this prospectus or any prospectus supplement in
any combination. Each unit will be issued so that the holder of the unit is also the holder, with the rights and obligations of
a holder, of each security included in the unit. The unit agreement under which a unit is issued may provide that the securities
included in the unit may not be held or transferred separately, at any time or at any times before a specified date or upon the
occurrence of a specified event or occurrence.
The
applicable prospectus supplement will describe:
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the
designation and the terms of the units and of the securities comprising the units, including whether and under what circumstances
those securities may be held or transferred separately;
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any
unit agreement under which the units will be issued;
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any
provisions for the issuance, payment, settlement, transfer or exchange of the units or of the securities comprising the units;
and
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whether
the units will be issued in fully registered or global form.
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PLAN
OF DISTRIBUTION
We
may sell the securities offered pursuant to this prospectus from time to time in one or more transactions, including, without
limitation:
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to
or through underwriters;
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through
broker-dealers (acting as agent or principal);
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directly
by us to one or more purchasers (including our affiliates and stockholders), through a specific bidding or auction process,
a rights offering or otherwise;
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through
a combination of any such methods of sale; or
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through
any other methods described in a prospectus supplement or free writing prospectus.
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The
distribution of securities may be effected, from time to time, in one or more transactions, including:
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block
transactions (which may involve crosses) and transactions on The Nasdaq Capital Market or any other organized market where
the securities may be traded;
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purchases
by a broker-dealer as principal and resale by the broker-dealer for its own account pursuant to a prospectus supplement or
free writing prospectus;
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ordinary
brokerage transactions and transactions in which a broker-dealer solicits purchasers;
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sales
“at the market” to or through a market maker or into an existing trading market, on an exchange or otherwise;
and
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sales
in other ways not involving market makers or established trading markets, including direct sales to purchasers.
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The
applicable prospectus supplement or free writing prospectus will describe the terms of the offering of the securities, including:
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the
name or names of any underwriters, if, and if required, any dealers or agents;
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the
purchase price of the securities and the proceeds we will receive from the sale;
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any
underwriting discounts and other items constituting underwriters’ compensation;
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any
discounts or concessions allowed or re-allowed or paid to dealers; and
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any
securities exchange or market on which the securities may be listed or traded.
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We
may distribute the securities from time to time in one or more transactions at:
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a
fixed price or prices, which may be changed;
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market
prices prevailing at the time of sale;
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prices
related to such prevailing market prices; or
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Only
underwriters named in the prospectus supplement are underwriters of the securities offered by the prospectus supplement.
If
underwriters are used in an offering, we will execute an underwriting agreement with such underwriters and will specify the name
of each underwriter and the terms of the transaction (including any underwriting discounts and other terms constituting compensation
of the underwriters and any dealers) in a prospectus supplement. The securities may be offered to the public either through underwriting
syndicates represented by managing underwriters or directly by one or more investment banking firms or others, as designated.
If an underwriting syndicate is used, the managing underwriter(s) will be specified on the cover of the prospectus supplement.
If underwriters are used in the sale, the offered securities will be acquired by the underwriters for their own accounts and may
be resold from time to time in one or more transactions, including negotiated transactions, at a fixed public offering price or
at varying prices determined at the time of sale. Any public offering price and any discounts or concessions allowed or reallowed
or paid to dealers may be changed from time to time. Unless otherwise set forth in the prospectus supplement, the obligations
of the underwriters to purchase the offered securities will be subject to conditions precedent, and the underwriters will be obligated
to purchase all of the offered securities, if any are purchased.
We
may grant to the underwriters options to purchase additional securities to cover over-allotments, if any, at the public offering
price, with additional underwriting commissions or discounts, as may be set forth in a related prospectus supplement. The terms
of any over-allotment option will be set forth in the prospectus supplement for those securities.
If
we use a dealer in the sale of the securities being offered pursuant to this prospectus or any prospectus supplement, we will
sell the securities to the dealer, as principal. The dealer may then resell the securities to the public at varying prices to
be determined by the dealer at the time of resale. The names of the dealers and the terms of the transaction will be specified
in a prospectus supplement.
We
may sell the securities directly or through agents we designate from time to time. We will name any agent involved in the offering
and sale of securities and we will describe any commissions we will pay the agent in the prospectus supplement. Unless the prospectus
supplement states otherwise, any agent will act on a best-efforts basis for the period of its appointment.
We
may authorize agents or underwriters to solicit offers by institutional investors to purchase securities from us at the public
offering price set forth in the prospectus supplement pursuant to delayed delivery contracts providing for payment and delivery
on a specified date in the future. We will describe the conditions to these contracts and the commissions we must pay for solicitation
of these contracts in the prospectus supplement.
In
connection with the sale of the securities, underwriters, dealers or agents may receive compensation from us or from purchasers
of the securities for whom they act as agents, in the form of discounts, concessions or commissions. Underwriters may sell the
securities to or through dealers, and those dealers may receive compensation in the form of discounts, concessions or commissions
from the underwriters or commissions from the purchasers for whom they may act as agents. Underwriters, dealers and agents that
participate in the distribution of the securities, and any institutional investors or others that purchase securities directly
for the purpose of resale or distribution, may be deemed to be underwriters, and any discounts or commissions received by them
from us and any profit on the resale of the common stock by them may be deemed to be underwriting discounts and commissions under
the Securities Act of 1933, as amended.
We
may provide agents, underwriters and other purchasers with indemnification against particular civil liabilities, including liabilities
under the Securities Act of 1933, as amended, or contribution with respect to payments that the agents, underwriters or other
purchasers may make with respect to such liabilities. Agents and underwriters may engage in transactions with, or perform services
for, us in the ordinary course of business.
To
facilitate the public offering of a series of securities, persons participating in the offering may engage in transactions that
stabilize, maintain, or otherwise affect the market price of the securities. This may include over-allotments or short sales of
the securities, which involves the sale by persons participating in the offering of more securities than have been sold to them
by us. In addition, those persons may stabilize or maintain the price of the securities by bidding for or purchasing securities
in the open market or by imposing penalty bids, whereby selling concessions allowed to underwriters or dealers participating in
any such offering may be reclaimed if securities sold by them are repurchased in connection with stabilization transactions. The
effect of these transactions may be to stabilize or maintain the market price of the securities at a level above that which might
otherwise prevail in the open market. Such transactions, if commenced, may be discontinued at any time. We make no representation
or prediction as to the direction or magnitude of any effect that the transactions described above, if implemented, may have on
the price of our securities.
Unless
otherwise specified in the applicable prospectus supplement, any common stock sold pursuant to a prospectus supplement will be
eligible for listing on the Nasdaq Capital Market, subject to official notice of issuance. Any underwriters to whom securities
are sold by us for public offering and sale may make a market in the securities, but such underwriters will not be obligated to
do so and may discontinue any market making at any time without notice.
In
order to comply with the securities laws of some states, if applicable, the securities offered pursuant to this prospectus will
be sold in those states only through registered or licensed brokers or dealers. In addition, in some states securities may not
be sold unless they have been registered or qualified for sale in the applicable state or an exemption from the registration or
qualification requirement is available and complied with.
LEGAL
MATTERS
The
validity of the securities offered by this prospectus will be passed upon by Haynes and Boone, LLP, New York, New York.
EXPERTS
The
consolidated financial statements of the Company and its subsidiary as of December 31, 2019, and December 31, 2018, and for each
of the two years in the period ended December 31, 2019, included in the Annual Report on Form 10-K for the year ended December
31, 2019, and incorporated in this prospectus by reference, have been so incorporated in reliance on the report (which contains
an explanatory paragraph relating to the Company’s ability to continue as a going concern as described in Note 2 to the
financial statements) of Marcum LLP, an independent registered public accounting firm, given on the authority of said firm as
experts in auditing and accounting.
WHERE
YOU CAN FIND MORE INFORMATION
We
are subject to the informational requirements of the Securities Exchange Act of 1934, as amended, and in accordance therewith
file annual, quarterly and current reports, proxy statements and other information with the Securities and Exchange Commission.
The Securities and Exchange Commission maintains a website that contains reports, proxy and information statements and other information
regarding registrants that file electronically with the Securities and Exchange Commission. The address of the Securities and
Exchange Commission’s website is www.sec.gov.
We
make available free of charge on or through our website at www.nanovibronix.com, our Annual Reports on Form 10-K, Quarterly Reports
on Form 10-Q, Current Reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d)
of the Securities Exchange Act of 1934, as amended, as soon as reasonably practicable after we electronically file such material
with or otherwise furnish it to the Securities and Exchange Commission.
We
have filed with the Securities and Exchange Commission a registration statement under the Securities Act of 1933, as amended,
relating to the offering of these securities. The registration statement, including the attached exhibits, contains additional
relevant information about us and the securities. This prospectus does not contain all of the information set forth in the registration
statement. You can obtain a copy of the registration statement for free at www.sec.gov. The registration statement and the documents
referred to below under “Incorporation of Certain Information By Reference” are also available on our website, www.nanovibronix.com.
We
have not incorporated by reference into this prospectus the information on our website, and you should not consider it to be a
part of this prospectus.
INCORPORATION
OF CERTAIN INFORMATION BY REFERENCE
The
Securities and Exchange Commission allows us to “incorporate by reference” the information we have filed with it,
which means that we can disclose important information to you by referring you to those documents. The information we incorporate
by reference is an important part of this prospectus, and later information that we file with the Securities and Exchange Commission
will automatically update and supersede this information. We incorporate by reference the documents listed below and any future
documents (excluding information furnished pursuant to Items 2.02 and 7.01 of Form 8-K) we file with the Securities and Exchange
Commission pursuant to Sections l3(a), l3(c), 14 or l5(d) of the Securities Exchange Act of 1934, as amended, subsequent to the
date of this prospectus and prior to the termination of the offering:
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Our
Annual Report on Form
10-K for the fiscal year ended December 31, 2019, filed with the Securities and Exchange Commission on May 20, 2020;
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Our
definitive Proxy Statement on Schedule
14A, filed with the Securities and Exchange Commission on June 15, 2020;
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Our
Quarterly Report on Form
10-Q for the quarter ended March 31, 2020, filed with the Securities and Exchange Commission on July 6, 2020;
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Our
Current Report on Form
8-K, filed with the Securities and Exchange Commission on March 30, 2020, as amended on April 3, 2020;
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Our
Current Report on Form
8-K, filed with the Securities and Exchange Commission on April 7, 2020;
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Our
Current Report on Form
8-K, filed with the Securities and Exchange Commission on April 29, 2020;
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Our
Current Report on Form
8-K, filed with the Securities and Exchange Commission on May 15, 2020;
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Our
Current Report on Form
8-K, filed with the Securities and Exchange Commission on June 3, 2020;
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Our
Current Report on Form
8-K, filed with the Securities and Exchange Commission on June 11, 2020;
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Our
Current Report on Form
8-K, filed with the Securities and Exchange Commission on June 26, 2020;
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Our
Current Report on Form
8-K, filed with the Securities and Exchange Commission on July 8, 2020; and
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The
description of our common stock, which is contained in our registration statement on
Form
8-A, filed with the Securities and Exchange Commission on October 19, 2017, as updated
or amended in any amendment or report filed for such purpose.
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All
filings filed by us pursuant to the Securities Exchange Act of 1934, as amended, after the date of the initial filing of this
registration statement and prior to the effectiveness of such registration statement (excluding information furnished pursuant
to Items 2.02 and 7.01 of Form 8-K) shall also be deemed to be incorporated by reference into the prospectus.
You
should rely only on the information incorporated by reference or provided in this prospectus. We have not authorized anyone else
to provide you with different information. Any statement contained in a document incorporated by reference into this prospectus
will be deemed to be modified or superseded for the purposes of this prospectus to the extent that a later statement contained
in this prospectus or in any other document incorporated by reference into this prospectus modifies or supersedes the earlier
statement. Any statement so modified or superseded will not be deemed, except as so modified or superseded, to constitute a part
of this prospectus. You should not assume that the information in this prospectus is accurate as of any date other than the date
of this prospectus or the date of the documents incorporated by reference in this prospectus.
We
will provide without charge to each person to whom a copy of this prospectus is delivered, upon written or oral request, a copy
of any or all of the reports or documents that have been incorporated by reference in this prospectus but not delivered with this
prospectus (other than an exhibit to these filings, unless we have specifically incorporated that exhibit by reference in this
prospectus). Any such request should be addressed to us at: 525 Executive Boulevard, Elmsford, New York 10523, Attention: James
Cardwell, Chief Financial Officer, or made by phone at (914) 233-3004. You may also access the documents incorporated by reference
in this prospectus through our website at www.nanovibronix.com. Except for the specific incorporated documents listed above, no
information available on or through our website shall be deemed to be incorporated in this prospectus or the registration statement
of which it forms a part.
1,794,783
Shares
PROSPECTUS SUPPLEMENT
H.C.
Wainwright & Co.
September
22, 2020
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