4.	Investment in Limited Liability Company

August 8, 2017,

the Company entered into an exclusive Distributorship Agreement (the “Distributorship Agreement”) with InControl Medical, LLC (“ICM”), a Wisconsin limited liability company focused on women's health, pursuant to which the Company will directly market, promote, distribute and sell ICM’s products to licensed medical professional offices and hospitals in North America.

Under the terms of the Distributorship Agreement, ICM agreed to

not

directly or indirectly appoint or authorize any

third

party to market, promote, distribute or sell any of the licensed products to any licensed medical professional offices and hospitals in the United States. In exchange, the Company agreed to

not

market, promote, distribute or sell (or contract to do so) any product which substantially replicates all or almost all of the key features of the licensed products. The Company has a minimum purchase requirement to purchase a certain quantity of ICM products per month during the term of this Distributorship Agreement. In addition, the parties agreed to certain mutual marketing obligations to promote sales of the licensed products. As of

June 30, 2018,

the Company has purchased approximately

2,700

units of ICM products. The Company paid ICM approximately

$63,000

and

$143,000

for product related costs during the

three

and

six

months ended

June 30, 2018,

respectively.

In connection with the Distributorship Agreement, the Company also entered into a Membership Unit Subscription Agreement with ICM and the associated limited liability company operating agreement of ICM, pursuant to which the Company invested

$2,500,000

in, and acquired membership units of, ICM. This investment has been recorded in investment in a limited liability company in the condensed consolidated balance sheets. The Company used the equity method to account for the investment in ICM because the Company does

not

control it but has the ability to exercise significant influence over it. As of

June 30, 2018,

the Company owns approximately

11%

ownership interest in ICM. The Company recognizes its allocated portion of ICM’s results of operations on a

three

-month lag due to the timing of financial information. For the

three

and

six

months ended

June 30, 2018,

the allocated net loss from ICM’s operations was

$158,000

and

$407,000,

respectively that was recorded as loss from minority interest in limited liability company in the condensed consolidated statements of operations.