NOTE

— SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Operations and Continuance of Operations

Predictive Oncology Inc., (the “Company” or “Predictive” or “we”) was originally incorporated on

April 23, 2002

in Minnesota as BioDrain Medical, Inc. Effective

August 6, 2013,

the Company changed its name to Skyline Medical Inc. Pursuant to an Agreement and Plan of Merger effective

December 16, 2013,

the Company merged with and into a Delaware corporation with the same name that was its wholly-owned subsidiary, with such Delaware corporation as the surviving corporation of the merger. On

August 31, 2015,

the Company completed a successful offering and concurrent uplisting to the NASDAQ Capital Market. On

February 1, 2018,

the Company filed with the Secretary of State of Delaware a Certificate of Amendment to its Certificate of Incorporation to change the corporate name from Skyline Medical Inc. to Precision Therapeutics Inc., effective

February 1, 2018.

Because of this change, the Company's common stock traded under the ticker symbol “AIPT,” effective

February 2, 2018.

June 10, 2019,

the Company filed with the Secretary of State of Delaware a Certificate of Amendment to its Certificate of Incorporation to change the corporate name from Precision Therapeutics Inc. to Predictive Oncology Inc., trading under the new ticker symbol “POAI,” effective

June 13, 2019.

Skyline Medical Inc. remains as an incorporated division of Predictive Oncology Inc. On

October 28, 2019,

the Company completed a

one

-for-

ten

reverse stock split that was effective for trading purposes on

October 29, 2019.

All numbers of shares and per-share amounts have been adjusted to reflect the reverse stock split.

The Company is a healthcare company that provides personalized medicine solution and medical devices in

two

main areas: (

) precision medicine, which aims to apply artificial intelligence (“AI “) to personalized medicine and drug discovery; and (

) an environmentally safe system for the collection and disposal of infectious fluids that result from surgical procedures and post-operative care. The Company also makes ongoing sales of proprietary cleaning fluid and filters to users of its systems.

In addition, the Company's wholly-owned subsidiary, TumorGenesis® Inc. (“TumorGenesis”), is developing the next generation, patient-derived tumor models for precision cancer therapy and drug development. TumorGenesis formed during the

first

quarter of

2018,

is presented as part of the consolidated financial statements (“financial statements”) and is included in corporate in the Company's segment reporting.

During the

first

quarter of

2018,

the Company acquired

25%

of the capital stock of Helomics Holding Corporation (“Helomics”). On

April 4, 2019,

the Company completed a forward triangular merger with Helomics Acquisition Inc., a wholly-owned subsidiary of the Company and Helomics, acquiring the remaining

75%

of the capital stock of Helomics (“Helomics Acquisition”).

The Company has incurred recurring losses from operations and has an accumulated deficit of

$108,383,108.

The Company does

not

expect to generate sufficient operating revenue to sustain its operations in the near-term. During fiscal year

2020,

the Company incurred negative cash flows from operations. These matters are indicators of substantial doubt and were alleviated as noted below due to the registered direct offerings and private placement in

January

and

February 2021.

October 24, 2019,

the Company entered into an equity purchase agreement with Oasis Capital, LLC (“Oasis”) providing for a

$15,000,000

equity line. From time to time during the

three

-year commitment period, provided that the closing conditions are satisfied, the Company

may

provide Oasis with put notices to purchase a specified number of shares subject to certain limitations and conditions and at specified prices, which generally represent discounts to the market price of our common stock. The Company has issued

4,353,429

shares of common stock valued at

$5,210,581

pursuant to the equity line. As of

December 31, 2020,

there was

$9,789,419

remaining in available balance under the equity line. Additional needs to access this line will be dilutive.

January

and

February 2021,

we received aggregate net proceeds of

$31,077,232

in a series of registered direct offerings and a private placement of equity securities. On

March 1, 2021,

we used

$5,906,802

of the net proceeds from the private placement to pay the remaining principal and interest on the loans originally issued in

September 2018,

September 2019

and

February 2020

and to pay premium payable upon such repayment. The remaining net proceeds of the

2021

transactions have been or will be used for working capital. See

Note

– Subsequent Events

for more information.

We believe that our existing capital resources will be sufficient to support our operating plan at least through

March 31, 2022.

However, we

may

also seek to raise additional capital to support our growth through additional debt, equity or other alternatives or a combination thereof. We would raise such capital through equity or debt financing to fund our capital and equipment investments and our operations.

We currently expect to use cash on hand, cash flows from operations and capital expenditures, in the next

twelve

months and beyond, and expect such sources to be sufficient to fund our requirements over that time.

Coronavirus Outbreak

March 2020,

the World Health Organization declared the recent spread of COVID-

to be a global pandemic. In response to the crisis, emergency measures have been imposed by governments worldwide, including mandatory social distancing and the shutdown of non-essential businesses. These measures have adversely impacted the global economy, disrupted global supply chains and created significant volatility and disruption of financial markets. While it is

not

currently possible to estimate the duration and severity of the COVID-

pandemic or the adverse economic impact resulting therefrom, our business and operations have been and will likely continue to be materially and adversely affected. For example, our contract manufacturer for the STREAMWAY® System has been forced to change locations, thereby delaying our order fulfillment for parts. We have also reduced on-site staff at several of our facilities, resulting in delayed production, less efficiency, and our sales staff is unable to visit with hospital administrators who are our customers and potential customers. In addition, COVID-

has impacted the Company's capital and financial resources, including our overall liquidity position and outlook. For instance, our accounts receivable has slowed while our suppliers continue to ask for pre-delivery deposits. Although we have received a Paycheck Protection Program (“PPP”) Loan pursuant to the CARES Act which has helped fund some payroll costs, we

may

not

be able to access necessary additional capital given the current condition of the financial markets. During the

fourth

quarter of

2020,

we received forgiveness of the amounts outstanding from the PPP. If COVID-

continues to spread or the response to contain the virus is unsuccessful, we

may

continue to experience a material adverse effect on our business, financial condition, results of operations, cash flows and stock price.

Recently Adopted Accounting Standards

February 2016,

the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”)

No.

2016

02,

Leases (Topic

842

)

(“ASU

2016

02”

), which requires lessees to put most leases on their balance sheets but recognize the expenses on their income statements in a manner similar to current practice. The standard states that a lessee would recognize a lease liability for the obligation to make lease payments and a right-to-use asset for the right to use the underlying asset for the lease term. The standard is effective for fiscal years and interim periods within those fiscal years beginning after

December 15, 2018.

The Company adopted ASU

2016

January 1, 2019,

using the transition relief to the modified retrospective approach, presenting prior year information based on the previous standard. Upon adoption, the Company recognized

$353,007

of lease right-of-use (ROU) assets and liabilities for operating leases on its consolidated balance sheet, of which,

$79,252

were classified as current liabilities. The adoption of ASU

2016

did

not

have a material impact on the Company's consolidated results of operations or cash flows.

The Company leases facilities under long-term operating leases that are non-cancelable and expire on various dates. At the lease commencement date, lease ROU assets and lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term, which includes all fixed obligations arising from the lease contract. If an interest rate is

not

explicit in a lease, the Company utilizes its incremental borrowing rate for a period that closely matches the lease term. See Note

– Leases.

Accounting Policies and Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and disclosure of contingent assets and liabilities at the date of the financial statements and during the reporting period. Actual results could materially differ from those estimates.

Reclassifications

Certain reclassifications have been made to the prior years' financial statements to conform to the current year presentation. The reclassifications had

effect on previously reported results of operations, cash flows or stockholders' equity.

Cash

The Company has

cash equivalents during the years ended

December 31, 2020

and

December 31, 2019.

Receivables

Receivables are reported at the amount the Company expects to collect on balances outstanding. The Company provides for probable uncollectible amounts through charges to earnings and credits to the valuation allowance based on management's assessment of the current status of individual accounts.

Amounts recorded in accounts receivable on the consolidated balance sheet include amounts billed and currently due from customers. The amounts due are stated at their net estimated realizable value. An allowance for doubtful accounts is maintained to provide for the estimated amount of receivables that will

not

be collected. The Company reviews customers' credit history before extending unsecured credit and establishes an allowance for uncollectible accounts based upon factors surrounding the credit risk of specific customers, historical trends and other information. Invoices are generally due

days after presentation. Accounts receivable over

days is generally considered past due. The Company does

not

accrue interest on past due accounts receivables. Receivables are written off once all collection attempts have failed and are based on individual credit evaluation and specific circumstances of the customer. The allowance for doubtful accounts balance was

as of both

December 31, 2020

and

2019.

Fair Value Measurements

As outlined in Accounting Standards Codification (“ASC”)

820,

Fair Value Measurement

, fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The accounting standards ASC

820

establishes a

three

-level fair value hierarchy that prioritizes information used in developing assumptions when pricing an asset or liability as follows:

Level

– Observable inputs such as quoted prices in active markets;

Level

– Inputs other than quoted prices in active markets, that are observable either directly or indirectly; and

Level

– Unobservable inputs where there is little or

market data, which requires the reporting entity to develop its own assumptions.

The Company uses observable market data, when available, in making fair value measurements. Fair value measurements are classified according to the lowest level input that is significant to the valuation.

The fair value of the Company's investment securities, which consist of cash, was determined based on Level

inputs. The fair value of the Company's derivative liabilities and debt were determined based on Level

inputs. The Company generally uses Black Scholes method for determining the fair value of warrants classified as liabilities on a recurring basis. In addition, the Company uses the Monte Carlo method and other acceptable valuation methodologies when valuing the conversion feature and other embedded features classified as derivatives on a recurring basis. See

Note

– Derivative

Inventories

Inventories are stated at the lower of cost or net realizable value, with cost determined on a

first

-in,

first

-out basis.

Fixed Assets

Fixed assets are stated at cost less accumulated depreciation. Depreciation of fixed assets is computed using the straight-line method over the estimated useful lives of the respective assets. Estimated useful asset life by classification is as follows:

	Years
Computers, software and office equipment	3	-	10
Leasehold improvements (1)	2	-	5
Manufacturing tooling	3	-	7
Laboratory equipment	4	-	6
Demo equipment		3

(

)

Leasehold improvements are amortized over the shorter of the useful life or the remaining lease term.

Upon retirement or sale of fixed assets, the cost and related accumulated depreciation or amortization are removed from the balance sheet and the resulting gain or loss is reflected in operations. Maintenance and repairs are charged to operations expense as incurred.

Long-lived Assets

Finite-lived intangible assets consist of patents and trademarks, licensing fees, developed technology, and customer relationships, and are amortized over their estimated useful life. Accumulated amortization is included in intangibles, net in the accompanying consolidated balance sheets.

The Company reviews finite-lived identifiable intangible assets for impairment in accordance with ASC

360,

Property, Plant and Equipment

, whenever events or changes in circumstances indicate the carrying amount

may

not

be recoverable. Events or changes in circumstances that indicate the carrying amount

may

not

be recoverable include, but are

not

limited to, a significant change in the medical device marketplace and a significant adverse change in the business climate in which the Company operates.

The Company reviews its other intangible assets in accordance with ASC

350,

Intangibles—Goodwill and Other

. Under this topic, intangible assets determined to have an indefinite useful life are

not

amortized but are tested for impairment annually or more often if an event or circumstances indicate that an impairment loss has been incurred. Our impairment testing as of

December 31, 2019

resulted in

$770,250

of impairment charges to our intangible assets.

Given the decrease in the Company's market capitalization from

June 30, 2020,

the Company determined that potential impairment indicators were present and that an impairment assessment was warranted for long-lived assets as of

September.

In evaluating tradename, estimated fair values were determined using discounted cash flows and implied royalty rates. Based on the results of the tradename assessments, the Company concluded that the fair values of the tradename exceeded the carrying values. The Company concluded there was

impairment of its intangible assets as of

December 31, 2020.

As a part of the Company's review of the tradename intangible asset associated with its Helomics reportable segment, the Company has determined the asset is a finite lived asset beginning

September 30, 2020.

The tradename has a remaining useful life of approximately

eighteen

years.

Because evaluation of other long-lived assets is necessary based on a triggering event, the Company prepared the undiscounted cash flows per ASC

360.

The Company concluded that the undiscounted cash flows of the long-lived assets exceeded the carrying values. The Company concluded there was

impairment of its finite lived assets as of

December 31, 2020.

Goodwill

In accordance with ASC

350,

Intangibles – Goodwill and Other

, goodwill is calculated as the difference between the acquisition date fair value of the consideration transferred and the fair value of net assets acquired. Goodwill is an asset representing the future economic benefits arising from other assets acquired in a business combination. Goodwill is

not

amortized but are tested on an annual basis for impairment during the

fourth

quarter, or whenever events or changes in circumstances indicate that the carrying amount

may

not

be fully recoverable.

To determine whether goodwill is impaired, annually or more frequently if needed, the Company performs a multi-step impairment test. The Company

first

has the option to assess qualitative factors to determine if it is more likely than

not

that the carrying value of a reporting unit exceeds its estimated fair value. The Company

may

also elect to skip the qualitative testing and proceed directly to the quantitative testing. When performing quantitative testing, the Company

first

estimates the fair values of its reporting units using discounted cash flows. To determine fair values, the Company is required to make assumptions about a wide variety of internal and external factors. Significant assumptions used in the impairment analysis include financial projections of free cash flow (including significant assumptions about operations including the rate of future revenue growth, capital requirements, and income taxes), long-term growth rates for determining terminal value and discount rates. Comparative market multiples are used to corroborate the results of the discounted cash flow test. These assumptions require significant judgement. Pursuant to ASU

2017

04,

Simplifying the Test for Goodwill Impairment

, the single step is to determine the estimated fair value of the reporting unit and compare it to the carrying value of the reporting unit, including goodwill. To the extent the carrying amount of goodwill exceeds the implied goodwill, the difference is the amount of the goodwill impairment. The Company also completed a reconciliation between the implied equity valuation prepared and the Company's market capitalization. The majority of the inputs used in the discounted cash flow model are unobservable and thus are considered to be Level

inputs. The inputs for the market capitalization calculation are considered Level

inputs.

The Company recognized loss on impairment goodwill during the year ended

December 31, 2020

$12,876,498.

See

Note

– Goodwill and Intangibles.

Based upon the Company's annual goodwill impairment test in

2019,

the Company concluded that goodwill was impaired as of the testing date of

December 31, 2019.

The Company's annual impairment test as of

December 31, 2019

resulted in

$8,100,000

of impairment expense related to goodwill.

The Company will continue to monitor its reporting units to determine whether events and circumstances warrant further interim impairment testing. Impairment of goodwill is

not

expected to be deductible for tax purposes. The Company can make

assurances that its goodwill will

not

be impaired in the future.

Leases –

At inception of a contract a determination is made whether an arrangement meets the definition of a lease. A contract contains a lease if there is an identified asset and the Company has the right to control the asset. Operating leases are recorded as right-of-use (“ROU”) assets with corresponding current and noncurrent operating lease liabilities on our consolidated balance sheets. Financing leases are included within machinery and equipment with corresponding current and noncurrent financing lease liabilities on our consolidated balance sheets.

ROU assets represent our right to use an underlying asset for the duration of the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Recognition on the commencement date is based on the present value of lease payments over the lease term using an incremental borrowing rate. Leases with a term of

months or less at the commencement date are

not

recognized on the balance sheet and are expensed as incurred.

The Company has lease agreements with lease and non-lease components, which are accounted for as a single lease component for all asset classes. Leases are accounted for at a portfolio level when similar in nature with identical or nearly identical provisions and similar effective dates and lease terms.

Revenue Recognition

The Company recognizes revenue when it satisfies a performance obligation by transferring control of the promised goods or services to its customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. Sales taxes are imposed on the Company's sales to nonexempt customers. The Company collects the taxes from the customers and remits the entire amounts to the governmental authorities. Sales taxes are excluded from revenue and expenses.

Revenue from Product Sales

The Company has medical device revenue consisting primarily of sales of the STREAMWAY System, as well as sales of the proprietary cleaning fluid and filters for use with the STREAMWAY System. This revenue stream is reported within both the domestic and international revenue segments. The Company sells its medical device products directly to hospitals and other medical facilities using employed sales representatives and independent contractors. Purchase orders, which are governed by sales agreements in all cases, state the final terms for unit price, quantity, shipping and payment terms. The unit price is considered the observable stand-alone selling price for the arrangements. The Company sales agreement, and Terms and Conditions, is a dually executed contract providing explicit criteria supporting the sale of the STREAMWAY System. The Company considers the combination of a purchase order and acceptance of its Terms and Conditions to be a customer's contract in all cases.

Product sales for medical devices consist of a single performance obligation that the Company satisfies at a point in time. The Company recognizes product revenue when the following events have occurred: (

) the Company has transferred physical possession of the products, (

) the Company has a present right to payment, (

) the customer has legal title to the products, and (

) the customer bears significant risks and rewards of ownership of the products. Based on the shipping terms specified in the sales agreements and purchase orders, these criteria are generally met when the products are shipped from the Company's facilities (“FOB origin,” which is the Company's standard shipping terms). As a result, the Company determined that the customer is able to direct the use of, and obtain substantially all of the benefits from, the products at the time the products are shipped. The Company

may,

at its discretion, negotiate different shipping terms with customers which

may

affect the timing of revenue recognition. The Company's standard payment terms for its customers are generally

days after the Company transfers control of the product to its customer. The Company allows returns of defective disposable merchandise if the customer requests a return merchandise authorization from the Company.

Customers

may

also purchase a maintenance plan for the medical devices from the Company, which requires the Company to service the STREAMWAY System for a period of

one

year subsequent to the

one

-year anniversary date of the original STREAMWAY System invoice. The maintenance plan is considered a separate performance obligation from the product sale, is charged separately from the product sale, and is recognized over time (ratably over the

one

-year period) as maintenance services are provided. A time-elapsed output method is used to measure progress because the Company transfers control evenly by providing a stand-ready service. The Company has determined that this method provides a faithful depiction of the transfer of services to its customers.

All amounts billed to a customer in a sales transaction for medical devices related to shipping and handling, if any, represent revenues earned for the goods provided, and these amounts have been included in revenue. Costs related to such shipping and handling billing are classified as cost of goods sold. This revenue stream is reported under the Skyline reportable segment.

Revenue from Clinical Testing

The Precision Oncology Insights are clinic diagnostic testing comprised of the Company's Tumor Drug Response Testing (formerly ChemoFx) and Genomic Profiling (formerly BioSpeciFx) tests. The Tumor Drug Response test determines how a patient's tumor specimen reacts to a panel of various chemotherapy drugs, while the Genomic Profiling test evaluates the expression of a particular gene related to a patient's tumor specimen. Revenues are recognized when control of the promised goods or services is transferred to customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. The estimated uncollectible amounts are generally considered implicit price concessions that are a reduction in revenue. Helomics payments terms vary by the agreements reached with insurance carriers and Medicare. The Company's performance obligations are satisfied at

one

point in time when test reports are delivered.

For service revenues, the Company estimates the transaction price which is the amount of consideration it expects to be entitled to receive in exchange for providing services based on its historical collection experience using a portfolio approach as a practical expedient to account for patient contracts as collective groups rather than individually. The Company monitors its estimates of transaction price to depict conditions that exist at each reporting date. If the Company subsequently determines that it will collect more consideration than it originally estimated for a contract with a patient, it will account for the change as an increase to the estimate of the transaction price, provided that such downward adjustment does

not

result in a significant reversal of cumulative revenue recognized.

The Company recognizes revenue from these patients when contracts as defined in ASC

606,

Revenue from Contracts with Customers

are established at the amount of consideration to which it expects to be entitled or when the Company receives substantially all of the consideration subsequent to the performance obligations being satisfied. The Company's standard payment terms for hospital and patient direct bill is

days after invoice date. This revenue stream is reported under the Helomics segment.

CRO Revenue

Contract revenues are generally derived from studies conducted with biopharmaceutical and pharmaceutical companies. The specific methodology for revenue recognition is determined on a case-by-case basis according to the facts and circumstances applicable to a given contract. The Company typically uses an input method that recognizes revenue based on the Company's efforts to satisfy the performance obligation relative to the total expected inputs to the satisfaction of that performance obligation. For contracts with multiple performance obligations, the Company allocates the contract's transaction price to each performance obligation on the basis of the standalone-selling price of each distinct good or service in the contract. Advance payments received in excess of revenues recognized are classified as deferred revenue until such time as the revenue recognition criteria have been met. Payment terms are net

from the invoice date, which is sent to the customer as the Company satisfies the performance obligation relative to the total expected inputs to the satisfaction of that performance obligation. This revenue stream is reported under the Helomics segment.

Variable Consideration

The Company records revenue from distributors and direct end customers in an amount that reflects the transaction price it expects to be entitled to after transferring control of those goods or services. The Company's current contracts do

not

contain any features that create variability in the amount or timing of revenue to be earned.

Warranty

The Company generally provides

one

-year warranties against defects in materials and workmanship on product sales and will either repair the products or provide replacements at

charge to customers. As they are considered assurance-type warranties, the Company does

not

account for them as separate performance obligations. Warranty reserve requirements are based on a specific assessment of the products sold with warranties where a customer asserts a claim for warranty or a product defect.

Contract Balances

The Company records a receivable when it has an unconditional right to receive consideration after the performance obligations are satisfied. As of

December 31, 2020

and

2019,

accounts receivable totaled

$256,878

and

$297,055,

respectively.

The Company's deferred revenues related primarily to maintenance plans of

$53,028

and

$40,384

as of

December 31, 2020

and

2019,

respectively.

Practical Expedients

The Company has elected the practical expedient

not

to determine whether contracts with customers contain significant financing components as well as the practical expedient to recognize shipping and handling costs at point of sale.

Valuation and accounting for stock options and warrants

The Company determines the grant date fair value of options and warrants using a Black-Scholes option valuation model based upon assumptions regarding risk-free interest rate, expected dividend rate, volatility and estimated term.

The fair value of each option and warrant grant is estimated on the grant date using the Black-Scholes option valuation model with the following assumptions:

	For the Year Ended December 31,
	2020			2019
	Stock Options
Expected dividend yield		0.0%			0.0%
Expected stock price volatility	82.6%	-	87%	78.6%	-	82.4%
Risk-free interest rate	0.13%	-	1.78%	1.50%	-	2.76%
Expected life (in years)		10			10
	Warrants
Expected dividend yield		0.0%			0.0%
Expected stock price volatility	82.6%	-	87%	78.6%	-	82.4%
Risk-free interest rate	0.135%	-	0.79%	1.39%	-	2.58%
Expected life (in years)	5/		5 .5		5

Research and Development

Research and development costs are charged to operations as incurred. Research and development costs were

$372,710

and

$422,964

for the years ended

2020

and

2019,

respectively.

Other Expense

Other expense consisted primarily of interest expense, payment penalties, amortization of original issue discounts, and loss on debt extinguishment associated to the Company's notes payable.

Offering Costs

Costs incurred which are direct and incremental to an offering of the Company's securities are deferred and charged against the proceeds of the offering, unless such costs are deemed to be insignificant in which case they are expensed as incurred.

Income Taxes

The Company accounts for income taxes in accordance with ASC

740,

Income Taxes

(“ASC

740”

). Under ASC

740,

deferred tax assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities and net operating loss and credit carryforwards using enacted tax rates in effect for the year in which the differences are expected to impact taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts expected to be realized.

There is

income tax provision in the accompanying consolidated statements of net loss due to the cumulative operating losses that indicate a

100%

valuation allowance for the deferred tax assets and state income taxes is appropriate.

The Company reviews income tax positions expected to be taken in income tax returns to determine if there are any income tax uncertainties. The Company recognizes tax benefits from uncertain tax positions only if it is more likely than

not

that the tax positions will be sustained on examination by taxing authorities, based on technical merits of the positions. The Company has identified

income tax uncertainties.

Under Internal Revenue Code Section

382,

certain stock transactions which significantly change ownership could limit the amount of net operating carryforwards that

may

be utilized on an annual basis to offset taxable income in future periods. The Company has

not

yet performed an analysis of the annual net operating loss carryforwards and limitations that are available to be used against taxable income. Consequently, the limitation, if any, could result in the expiration of the Company's loss carryforwards before they can be utilized. The Company has

not

analyzed net operating loss carryforwards under Section

382

to date. As a result of the Helomics acquisition, there

may

be significant limitation to the net operating loss. In addition, the current NOL carryforwards might be further limited by future issuances of our common stock.

Tax years subsequent to

2017

remain open to examination by federal and state tax authorities.

Credit Risk

Financial instruments which potentially subject the Company to concentrations of credit risk consist principally of cash. The Company places its cash with high credit quality financial institutions and, by policy, generally limits the amount of credit exposure to any

one

financial institution. The Company has a credit risk of

$238,504

for cash amounts held in a single institution that are in excess of amounts issued by the Federal Deposit Insurance Corporation.

Risks and Uncertainties

The Company is subject to risks common to companies in the medical device and biopharmaceutical industries, including, but

not

limited to, development by the Company or its competitors of new technological innovations, dependence on key personnel, protection of proprietary technology, and compliance with regulations of the Food and Drug Administration, Clinical Laboratory Improvement Amendments, and other governmental agencies.

The Company has evaluated all of its activities and concluded that

other subsequent events have occurred that would require recognition in the consolidated financial statements or disclosure in the notes to the consolidated financial statements, except as described above and in

Note

– Subsequent Events