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NVNT Novint

Filed: 21 May 21, 3:59pm

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 10-Q

 

(Mark One)

 

 QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934  

 

For the quarterly period ended March 31, 2021

 

OR

 

 TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from ____ to ____

 

Commission File No. 000-51783

 

NOVINT TECHNOLOGIES, INC.

(Exact Name of Registrant as Specified in Its Charter)

 

Delaware 85-0461778
(State or Other Jurisdiction of Incorporation or Organization) (IRS Employer Identification No.)
   
100 Merrick Road–Suite 400W  
Rockville Center, NY 11570
(Address of Principal Executive Offices) (Zip Code)
   
(866) 298-4420
Registrant’s Telephone Number, including Area Code:

 

Securities registered pursuant to Section 12(b) of the Act: None

 

Securities registered pursuant to Section 12(g) of the Act:

 

Title of each class
Common Stock, $.0001 Par Value Per Share

 

Indicate by check whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No  

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes No  

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Larger Accelerated Filer Accelerated Filer
Non-Accelerated Filer Smaller Reporting Company
Emerging growth company  

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes  No

 

On May 21, 2021, the Registrant had 202,308,728 shares of common stock outstanding. 

 

 

 
  

 TABLE OF CONTENTS

NOVINT TECHNOLOGIES, INC.

FORM 10-Q

 

PART I. FINANCIAL INFORMATION Page
   
Item 1.Financial Statements (unaudited)1
 Balance Sheets as of March 31, 2021 and December 31, 20201
 Statements of Operations for the Three Months Ended March 31, 2021 and 20202
 Statements of Stockholders’ Equity (Deficit) for the Three Months Ended March 31, 2021 and 20203
 Statements of Cash flows for the Three Months Ended March 31, 2021 and 20204
 Notes to Financial Statements5
   
Item 2Management’s Discussion and Analysis of Financial Condition and Results of Operations8
   
Item 4Controls and Procedures10
   
PART II. OTHER INFORMATION  
   
Item 1Legal Proceedings10
   
Item 1ARisk Factors10
   
Item 2Unregistered Sales of Equity Securities and Use of Proceeds10
   
Item 3Defaults Upon Senior Securities10
   
Item 5Other Information10
   
Item 6Exhibits10
   
SIGNATURES 14

 

  i 
  

 

 

PART I - FINANCIAL INFORMATION

 

Item 1. Financial Statements

 

Novint Technologies, Inc.
CONDENSED BALANCE SHEETS
 
 March 31, December 31, 
 2021 2020 
 (Unaudited)    
ASSETS      
       
CURRENT ASSETS:      
Cash and cash equivalents$              267,638 $               322,032 
Accounts receivables - related party                   1,152          — 
Prepaid expenses and other current assets                   6,228   6,040 
Total Current Assets               275,018                 328,072 
       
TOTAL ASSETS$              275,018 $               328,072 
       
LIABILITIES AND STOCKHOLDERS' DEFICIT      
       
CURRENT LIABILITIES:      
Accounts payable and accrued expenses$              697,119 $               702,669 
Total Current Liabilities               697,119                 702,669 
       
TOTAL LIABILITIES               697,119                 702,669 
       
STOCKHOLDERS' DEFICIT      
       

Preferred stock, $0.0001 par value; 12,500,000 shares authorized, 0 shares

issued and outstanding as of March 31, 2021 and December 31, 2020

    

Common stock, $0.0001 par value; 500,000,000 shares authorized, 202,308,728 shares

issued and outstanding as of March 31, 2021 and December 31, 2020

                 20,231                   20,231 
Additional paid in capital          41,059,293            41,059,293 
Accumulated deficit         (41,501,625)          (41,454,121) 
TOTAL STOCKHOLDERS' DEFICIT              (422,101)               (374,597) 
       
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT$              275,018 $               328,072 
       

 

The accompanying notes are an integral part of these financial statements

 

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Novint Technologies, Inc.
CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
       
 For Three Months Ended March 31, 
 2021 2020 
       
Revenue$ 1,195 $ 1,000 
       
Operating Expenses      
Professional fees  21,509    31,200 
General and administrative expenses  27,137    20,088 
Total Operating Expenses  48,646    51,288 
       
Loss from operations  (47,451)   (50,288) 
       
Other expense:      
Interest expense, net    (53)    (106) 
Total other expense    (53)    (106) 
       
Loss before provision for income taxes  (47,504)   (50,394) 
Provision for income taxes      —       — 
Net loss$ (47,504) $ (50,394) 
       
Net loss per share      
Basic and Diluted$ (0.00) $  (0.00) 
       
Weighted-average common shares outstanding      
Basic and Diluted     202,308,728       202,308,728 
       

 

The accompanying notes are an integral part of these financial statements

 

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Novint Technologies, Inc.
CONDENSED STATEMENTS OF STOCKHOLDERS’ DEFICIT
(Unaudited) 
               
  Three Months Ended March 31, 2021 
       Additional       
 Common Stock  Paid-in  Accumulated    
 Shares  Amount  Capital  (Deficit)  Total 
Balances, December 31, 2020            202,308,728 $   20,231 $              41,059,293 $            (41,454,121) $                 (374,597) 
Net Loss for the Three Months           —              —              —    (47,504)   (47,504) 
Balances, March 31, 2021            202,308,728     20,231                41,059,293              (41,501,625)                   (422,101) 
               
  Three Months Ended March 31, 2020 
       Additional       
 Common Stock  Paid-in  Accumulated    
 Shares  Amount  Capital  (Deficit)  Total 
Balances, December 31, 2019            202,308,728 $   20,231 $              41,059,293 $            (41,286,135) $                 (206,611) 
Net Loss for the Three Months           —             —              —    (50,394)   (50,394) 
Balances, March 31, 2020            202,308,728     20,231                41,059,293              (41,336,529)                   (257,005) 
               

 

The accompanying notes are an integral part of these financial statements

 

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Novint Technologies, Inc.
 CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
       
 For the Period Ended March 31, 
 2021 2020 
Cash flows from operating activities:      
Net loss$ (47,504) $ (50,394) 
Changes in operating assets and liabilities:      
Prepaid expenses and other current assets (188)   (2,955) 
Accounts receivables  (1,152)    
Accounts payable and accrued expenses  (5,550)    19,709 
Net cash used in operating activities  (54,394)   (33,640) 
       
Net decrease in cash  (54,394)   (33,640) 
       
Cash and cash equivalents, beginning of year 322,032  431,715 
       
Cash and cash equivalents, end of period$267,638 $398,075 
       
Supplemental cash flow information:      
       
Cash paid for interest$   53 $ 106 
Cash paid for taxes$  — $  — 
       

 

The accompanying notes are an integral part of these financial statements  

 

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 NOVINT TECHNOLOGIES, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS

MARCH 31, 2021

(Unaudited)

 

 

NOTE 1 – DESCRIPTION OF BUSINESS

 

Novint Technologies, Inc. (the “Company” or “Novint”) was originally incorporated in the State of New Mexico in April 1999. On February 26, 2002, the Company changed its state of incorporation to Delaware by merging with Novint Technologies, Inc., a Delaware corporation. This merger was accounted for as a reorganization of the Company.

 

Nature of Business

 

The Company currently is engaged in the sale of 3D haptics products and equipment. Haptics refers to one’s sense of touch.  The Company’s focus is in the consumer interactive computer gaming market, but the Company also does project work in other areas. The Company sells its haptics products primarily to consumers through online retail marketplaces.

 

Going Concern and Management’s Plans

 

These financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has incurred recurring losses and at March 31, 2021, had an accumulated deficit of $41,501,625. For the period ended March 31, 2021, the Company sustained a net loss of $47,504. These factors, among others, indicate that the Company may be unable to continue as a going concern for the next twelve months from the date the financial statements were issued. These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that may be necessary should the Company be unable to continue as a going concern. The Company’s continuation as a going concern is contingent upon its ability to obtain additional financing, and to generate revenue and cash flow to meet its obligations on a timely basis. Management intends to source new inventory and generate revenue. The Company will continue to seek and raise additional funding through debt or equity financing during the next twelve months.

 

We may be at risk as a result of the current COVID-19 pandemic. Risks that could affect our business include the duration and scope of the COVID-19 pandemic and the impact on the demand for our products; actions by governments, businesses and individuals taken in response to the pandemic; the length of time of the COVID-19 pandemic and the possibility of its reoccurrence; the timing required to develop effective treatments and a vaccine in the event of future outbreaks; the eventual impact of the pandemic and actions taken in response to the pandemic on global and regional economies; and the pace of recovery when the COVID-19 pandemic subsides.

 

 

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Use of Estimates and Assumptions

 

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  The most significant estimates and assumptions made in the preparation of the financial statements relate to accrued royalties and contingent consideration.  Actual results could differ from those estimates.

 

Basis of Presentation

 

The accompanying unaudited condensed financial statements were prepared using generally accepted accounting principles for interim financial information and the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, these unaudited condensed financial statements do not include all information or notes required by generally accepted accounting principles for annual financial statements and should be read in conjunction with the Company’s annual financial statements included within the Company’s Special Report on Form 10-K for the year ended December 31, 2020, as filed with the SEC on March 24, 2021.

 

In the opinion of management, the unaudited condensed financial statements included herein contain all adjustments necessary to present fairly the Company’s financial position and the results of its operations and cash flows for the interim periods presented. Such adjustments are of a normal recurring nature. The results of operations for the three months ended March 31, 2021 may not be indicative of results for the full year.

 

Cash and Cash Equivalents

 

The Company considers all highly liquid investments purchased with maturities of three months or less to be cash equivalents. The Company maintains cash balances at financial institutions that are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to federally insured limits. At times balances may exceed FDIC insured limits. The Company has not experienced any losses in such accounts.

 

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Revenue and Cost Recognition

 

In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606), and has since issued amendments thereto (collectively referred to as “ASC 606”). The core principle of ASC 606 is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services, and the guidance defines a five-step process to achieve this core principle. The five-step process to achieve this principle is as follows: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract(s), (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract(s), and (v) recognize revenue when, or as, the entity satisfies a performance obligation. ASC 606 also mandates additional disclosure about the nature, amount, timing and uncertainty of revenues and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract.

 

Revenue from product sales relates to the sale of the Falcon 3D Touch Haptic Controller (the “Falcon”), which is a human-computer user interface and related accessories. The Falcon allows the user to experience the sense of touch when using a computer, while holding its interchangeable handle. The Falcons are manufactured by an unrelated party. Revenue from product sales are recognized when products are shipped to the customer and the Company has earned the right to receive and retain reasonable assured payments for the products sold and delivered. Consequently, if revenue recognition requirements are not met, such sales will be recorded as deferred revenue until revenue recognition requirements are met.

 

Accounts Receivable

 

Accounts receivable are stated at the amounts management expects to collect. An allowance for doubtful accounts is recorded based on a combination of historical experience, aging analysis and information on specific accounts. Account balances are written off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. As of March 31,2021, the company has recorded $0 in accounts receivable. Management has determined that $0 allowance is required at March 31, 2021 and December 31, 2020.

 

Accounts Receivable – Related Party

 

Accounts receivable from related party arise from the sale of the Company’s product that were collected by a director of the Company on behalf of the Company. As of March 31, 2021, the total accounts receivable from a related party was $1,152.

 

Income Taxes

 

The Company accounts for its income taxes under the provisions of ASC Topic 740, “Income Taxes”. The method of accounting for income taxes under ASC 740 is an asset and liability method which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are based on the differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the Statements of Operations in the period that includes the enactment date.

 

Fair Value of Financial Instruments

 

 The Company follows the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) for disclosures about fair value of its financial instruments and to measure the fair value of its financial instruments. The FASB ASC establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The three levels of fair value hierarchy are described below:

 

Level 1Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.
  
Level 2Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date.
  
Level 3Pricing inputs that are generally observable inputs and not corroborated by market data.

 

Financial assets are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable. 

 

The carrying amounts of the Company’s financial assets and liabilities, including cash, prepaid expenses, accounts payable, accrued expenses, payroll and related liabilities, and advances approximate their fair values because of the short maturity of these instruments.

 

Recently Issued Accounting Pronouncements

 

The Company has reviewed the recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and the SEC and they did not or are not believed by management to have a material impact on the Company’s present or future consolidated financial statement presentation or disclosures.

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NOTE 3 – ACCOUNTS PAYABLE AND ACCRUED EXPENSES

 

Accounts payable and accrued expenses are as follows:

 

  March 31,   December 31, 
  2021  2020 
Trade payables $99,313  $117,313 
Accrued expenses  2,174   2,224 
Accrued royalties  595,632   583,132 
Total accounts payable and accrued expenses $697,119  $702,669 

 

NOTE 4 – COMMITMENTS AND CONTINGENCIES

 

From time to time, in the normal course of business, the Company is subject to routine litigation incidental to its business. Although there can be no assurances as to the ultimate disposition of any such matters, it is the opinion of management, based upon the information available at this time, that there are no matters, individually or in the aggregate, that will have a material adverse effect on the results of operations and financial condition of the Company.

 

The Company has licensing agreements with various parties providing gaming software. These licensing agreements have royalty fees ranging from 5% to 50% of either gross or net revenue, and a flat per user end fee of $0.50. Under one or more of these agreements, there was an annual aggregate minimum payment due of $50,000 which has been recorded as accrued royalties but remains unpaid. Accrued royalty fees as of March 31, 2021 and December 31, 2020, was $595,632 and $583,132, respectively. If contested, the Company may be found to be in breach of obligations to pay these amounts (although the Company believes this obligation is no longer ongoing), thus the remaining obligation under this agreement will remain as a liability.

 

NOTE 5 – STOCKHOLDERS’ EQUITY

 

Preferred Stock

 

The Company is currently authorized to issue up to 12,500,000 shares of $0.0001 par value preferred stock. No shares of preferred stock are currently outstanding. The Board of Directors may designate the authorized but unissued shares of the Preferred Stock with such rights and privileges as the board of directors may determine. As such, the board of directors may issue preferred shares and designate the conversion, voting and other rights and preferences without notice to the shareholders and without shareholder approval.

 

Common Stock

 

The Company is currently authorized to issue up to 500,000,000 shares of $0.0001 par value common stock. All issued shares of common stock are entitled to vote on a 1 share/1 vote basis.

 

The Company had 202,308,728 shares of common stock issued and outstanding as of March 31, 2021 and December 31, 2020.

 

 

NOTE 6 – SUBSEQUENT EVENTS

 

The Company has evaluated subsequent events through the date these financial statements were issued.

 

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Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

The following discussion and analysis should be read in conjunction with the audited Financial Statements and accompanying notes thereto included in the Company’s Annual Report on Form 10-K as of and for the fiscal year ended December 31, 2020.  Unless otherwise noted, all the financial information in this Report is financial information for the Company.

 

General

 

The Company currently is engaged in the sale of 3D haptics products and equipment. Haptics refers to one’s sense of touch.  The Company’s focus is in the consumer interactive computer gaming market, but the Company also does project work in other areas. The Company sells its haptics products primarily to consumers through online retail marketplaces.

  

Results of Operations for the Three Months Ended March 31, 2021 and 2020

 

Revenues

 

  Three months ended March 31, 
  2021  2020  Change 
Revenue $1,195  $1,000  $195 
             

The Company recorded revenue of $1,195 and $1,000 for the three-month period ended March 31, 2021 and March 31, 2020. The Company incurred revenue from the sales of Falcon 3D Touch Haptic Controller. The Company expects to continue to incur significant expenses and operating losses for the foreseeable future. The Company’s net losses may fluctuate significantly from quarter to quarter and year to year.

 

Operating Expenses

 

  Three months ended March 31, 
  2021  2020  Change 
Operating Expenses $48,646  $51,288  $(2,642) 
             

Operating expenses decreased by $2,642 or 5% to $48,646 for the three months ended March 31, 2021, from $51,288 for the three months ended March 31, 2020. This decrease was primarily due to a decrease in professional fees and consultant fees that were incurred during the three months ended March 31, 2020.

 

Other Expense

 

  Three months ended March 31, 
  2021  2020  Change 
Other Expense $53  $106  $(53) 
             

Other expense decreased by $53 or 50% to $53 during the three months ended March 31, 2021 compared with $106 during the three months ended March 31, 2020. Other expense for the three months ended March 31, 2021 consisted of interest expense related to finance charges on credit cards.

 

Liquidity and Capital Resources

 

The following table summarizes select balance sheet and working capital amounts as of March 31, 2021 and December 31, 2020:

 

  As of  As of    
  March 31,  December 31,    
  2021  2020  Change 
Cash $267,638  $322,032  $(54,394) 
Working capital deficit $422,101  $374,597  $47,503 

 

At March 31, 2021, the Company had a working capital deficit of approximately $422,100. Accumulated deficit amounted to $41,501,625 and $41,454,121 at March 31, 2021 and December 31, 2020, respectively. Net loss for the three months ended March 31, 2021 and 2020 was $47,504 and $50,394, respectively. Net cash used in operating activities was $54,394 and $33,640 for the three months ended March 31, 2021 and 2020, respectively. Operations since inception have been funded primarily with the proceeds from equity and debt offerings. As of March 31, 2021, the Company had cash of $267,638.

 

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The Company’s management has evaluated whether there is substantial doubt about the Company’s ability to continue as a going concern and has determined that substantial doubt existed as of the date of this filing. This determination was based on the following factors: (i) the Company’s available cash as of the date of this filing will not be sufficient to fund its anticipated level of operations for the next 12 months; (ii) the Company has incurred recurring losses and at March 31, 2021, had an accumulated deficit of $41,501,625; (iii) the Company sustained an operating loss of $47,451 for the period ended March 31, 2021; and (iv) if the Company fails to obtain the needed capital, it will be forced to delay, scale back, or eliminate some or all of its programs or perhaps cease operations. In the opinion of management, these factors, among others, raise substantial doubt about the ability of the Company to continue as a going concern.

There is no assurance that the Company will be successful in any capital-raising efforts that it may undertake to fund operations during 2021. The Company anticipates that it will continue to issue equity and/or debt securities as a source of liquidity, until it begins to generate positive cash flow to support its operations. Any future sales of securities to finance operations will dilute existing stockholders’ ownership. The Company cannot guarantee when or if it will generate positive cash flow.

 

The audit report prepared by our independent registered public accounting firm relating to the Company’s consolidated financial statements for the year ended December 31, 2020 included an explanatory paragraph expressing substantial doubt about our ability to continue as a going concern.

 

Cash Flow Activities

 

The following table summarizes the Company’s cash flows for the periods set forth below:

 

  Three months ended March 31, 
  2021  2020  Change 
Net cash used in operating activities $54,394  $       33,640  $         20,754 
             

Net cash used in operating activities for the three months ended March 31, 2021 was $54,394 compared with net cash used in operating activities of $33,640 for the three months ended March 31, 2020. The increase in net cash used in operating activities during the three months ended March 31, 2021 was primarily due to an increase in net loss to $47,504, partially offset by a decrease of $5,550 in accounts payable and accrued expenses.

 

Net cash used in operating activities for the three months ended March 31, 2020 was $33,640, representing a net loss of $50,394 partially offset by an increase of $19,709 in accounts payable and accrued expenses.

 

Effects of Inflation

 

We do not believe that inflation has had a material impact on our business, sales, or operating results during the periods presented.

 

Off-Balance Sheet Arrangements

 

We currently do not have any off-balance sheet arrangements or financing activities with special-purpose entities.

 

Critical Accounting Policies and Use of Estimates

 

Critical accounting policies are those policies which are both important to the presentation of a company’s financial condition and results and require management’s most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain.  There have been no recent significant changes to our accounting policies and use of estimates during the three months ended March 31, 2021.  For a further discussion of our critical accounting policies, see our Annual Report on Form 10-K for the fiscal year ended December 31, 2020.

 

Certain Factors That May Affect Future Results of Operations

 

The Securities and Exchange Commission encourages companies to disclose forward-looking information so that investors can better understand a company’s future prospects and make informed investment decisions. This Quarterly Report on Form 10-Q contains such “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995.All statements in this report, other than statements of historical fact, are forward-looking statements for purposes of these provisions, including any projections of earnings, revenues or other financial items, any statements of the plans and objectives of management for future operations, any statements concerning proposed new products or services, any statements regarding future economic conditions or performance, and any statements of assumptions underlying any of the foregoing. All forward-looking statements included in this report are made as of the date hereof and are based on information available to us as of such date. We assume no obligation to update any forward-looking statement. In some cases, forward-looking statements can be identified by the use of terminology such as “may,” “will,” “expects,” “plans,” “anticipates,” “intends,” “believes,” “estimates,” “potential,” or “continue,” or the negative thereof or other comparable terminology. Although we believe that the expectations reflected in the forward-looking statements contained herein are based upon reasonable assumptions at the time made, there can be no assurance that any such expectations or any forward-looking statement will prove to be correct. Our actual results will vary, and may vary materially, from those projected or assumed in the forward-looking statements. Future financial condition and results of operations, as well as any forward-looking statements, are subject to inherent risks and uncertainties, many of which we cannot predict with accuracy and some of which we might not anticipate, including, without limitation, product recalls and product liability claims; infringement of our technology or assertion that our technology infringes the rights of other parties; termination of supplier relationships, or failure of suppliers to perform; inability to successfully manage growth; delays in obtaining regulatory approvals or the failure to maintain such approvals; concentration of our revenue among a few customers, products or procedures; development of new products and technology that could render our products obsolete; market acceptance of new products; introduction of products in a timely fashion; price and product competition, availability of labor and materials, cost increases, and fluctuations in and obsolescence of inventory; volatility of the market price of our common stock; foreign currency fluctuations; changes in key personnel; work stoppage or transportation risks; integration of business acquisitions; and other factors referred to in our reports filed with the SEC, including our Registration Statement on Form 10. All subsequent forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by these cautionary statements. Additional factors that may have a direct bearing on our operating results are discussed in Item 1A “Risk Factors” in our Registration Statement on Form 10. In light of these assumptions, risks and uncertainties, the results and events discussed in the forward-looking statements contained in this Quarterly Report or in any document incorporated by reference might not occur. Stockholders are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date of this Quarterly Report. We are not under any obligation, and we expressly disclaim any obligation, to update or alter any forward-looking statements, whether as a result of new information, future events or otherwise. All subsequent forward-looking statements attributable to us or to any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this section.

 

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Item 4.  CONTROLS AND PROCEDURES

 

Disclosure Controls and Procedures

 

 We maintain disclosure controls and procedures (Disclosure Controls) within the meaning of Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended, or the Exchange Act. Our Disclosure Controls are designed to ensure that information required to be disclosed by us in the reports we file or submit under the Exchange Act, such as this Quarterly Report on Form 10-Q, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms. Our Disclosure Controls are also designed to ensure that such information is accumulated and communicated to our management, including our Chief Executive Officer and Principal Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating our Disclosure Controls, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management necessarily applied its judgment in evaluating and implementing possible controls and procedures. As of the end of the period covered by this Quarterly Report on Form 10-Q, we evaluated the effectiveness of the design and operation of our Disclosure Controls, which was done under the supervision and with the participation of our management, including our Chief Executive Officer and Principal Financial Officer. Based on the evaluation of our Disclosure Controls, our Chief Executive Officer and Principal Financial Officer has concluded that, as of March 31, 2021, our Disclosure Controls were not effective due to a material weakness in the Company’s internal control over financial reporting. The ineffectiveness of our internal control over financial reporting at March 31, 2021, was due to an insufficient degree of segregation of duties among our accounting and financial reporting personnel. During the remainder of 2021, we intend to work to remediate the material weaknesses identified above, which could include the addition of accounting and financial reporting personnel and/or the engagement of accounting and personnel consultants on a limited-time basis until we add a sufficient number of personnel.

 

Change in Internal Control over Financial Reporting

 

Except as described above, there were no changes in our internal control over financial reporting that occurred during the three months ended March 31, 2021 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

 

PART II - OTHER INFORMATION

 

Item 1.  LEGAL PROCEEDINGS

 

None

 

Item 1A. RISK FACTORS

 

Not required to be provided by smaller reporting companies.

 

Item 2.  UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

 

None

 

Item 3. DEFAULTS UPON SENIOR SECURITIES

 

None.

 

 

Item 5. OTHER INFORMATION

 

None.

 

Item 6. EXHIBITS  

 

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EXHIBIT INDEX

 

Number Description
   
31.1 Certification of the President and Chief Executive Officer pursuant to Rule 13a-14(a) and 15d-14(a), as adopted pursuant to section 302 of the Sarbanes- Oxley Act of 2002 (filed herewith).
   
32.1 Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to section 906 of the Sarbanes- Oxley Act of 2002 (filed herewith).
   
101. INS XBRL Instance Document (submitted electronically herewith).
   
101. SCH XBRL Taxonomy Extension Schema Document (submitted electronically herewith).
   
101. CAL XBRL Taxonomy Extension Calculation Linkbase Document (submitted electronically herewith).
   
101. LAB XBRL Taxonomy Extension Label Linkbase Document (submitted electronically herewith).
   
101. PRE XBRL Taxonomy Extension Presentation Linkbase Document (submitted electronically herewith).
   
101. DEF XBRL Taxonomy Extension Definition Linkbase Document (submitted electronically herewith).
   
3.1 Amend and Restated Certificate of Incorporation*
   
3.2 (6) Amended and Restated Bylaws*
   
3.3 (1) Articles of Merger*
   
3.4 (1) Certificate of Merger*
   
4.1 (1) Articles of Incorporation (See Exhibit 3.1) *
   
4.2 (3) Form of Common Stock Purchase Warrant, April 2006*
   
4.3 (7) Form of Common Stock Purchase Warrant, March 2007*
   
10.1 (1) License Agreement with Sandia; Amendments*
   
10.2 (1) Lease for 9620 San Mateo*
   
10.3 (1) Employment Agreement with Tom Anderson*
   
10.4 (1) Employment Agreement with Walter Aviles*
   
10.5 (10) Amended and Restated 2004 Stock Incentive Plan*
   
10.6 (1) Shareholders Agreement*

 

 

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10.7 (1) Lock Up Agreement*
   
10.8 (1) Miscellaneous Technical Services Agreement between Aramco Services Company and Novint Technologies, Inc.*
   
10.9 (1) Contract Addendum between Aramco Services Company and Novint Technologies, Inc.*
   
10.10 (1) Amendment to Contract between Aramco Services Company and Novint Technologies, Inc.*
   
10.11 (1) Amendment to Contract between Aramco Services Company and Novint Technologies, Inc.*
   
10.12 (1) Statement of Work between Chevron Corporation and Novint Technologies, Inc.*
   
10.13 (1) Purchase Order from DaimlerChrylser Corporation*
   
10.14 (1) Purchase Order # 94059 from LockheedMartin Corporation*
   
10.15 (1) Purchase Order # 96996 from LockheedMartin Corporation*
   
10.16 (1) Purchase Order # 97860 from LockheedMartin Corporation*
   
10.17 (1) Purchase Order # Q50601685 from LockheedMartin Corporation*
   
10.18 (1) Purchase Order # QQ060592 from LockheedMartin Corporation*
   
10.19 (1) Purchase Order # Q50608809 from LockheedMartin Corporation*
   
10.20 (1) Purchase Order # 24232 from Sandia National Laboratories*
   
10.21 (1) Purchase Order # 27467 from Sandia National Laboratories*
   
10.22 (1) Purchase Order # 117339 from Sandia National Laboratories*
   
10.23 (1) Purchase Order # 250810 from Sandia National Laboratories*
   
10.24 (1) Undersea Exploration Modeling Agreement between Woods Hole Oceanographic Institute and Novint Technologies, Inc.*
   
10.25 (1) Purchase Order for Lunar Design, Inc. dated April 7, 2005*
   
10.26 (1) Sublicense Agreement between Manhattan Scientifics and Novint Technologies, Inc.*

 

 

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10.27 (1) License and Royalty Agreement between Manhattan Scientifics and Novint Technologies, Inc.*
   
10.28 (1) Research Development and License Agreement between Manhattan Scientifics and Novint Technologies, Inc.*
   
10.29 (1) Intellectual Property License Agreement with Force Dimension LLC*
   
10.30 (1) Purchase Order with Lockheed Martin dated April 1, 2005*
   
10.31 (1) Purchase Order with Lockheed Martin dated April 4, 2005*
   
10.32 (1) Purchase Order with Lockheed Martin dated April 21, 2005*
   
10.33 (1) Purchase Order with Deakin University dated April 6, 2004*
   
10.34 (1) Purchase Order with Robarts Research dated September 24, 2004*
   
10.35 (1) Purchase Order with University of New Mexico dated March 16, 2004*
   
10.36 (1) Amendment to Agreement with Force Dimension Dated May 5, 2005*
   
10.37 (1) Amendment to contract between Aramco Services Company and Novint Technologies, Inc*
   
10.38 (2) Purchase Order with Lockheed Martin dated February 16, 2006*
   
10.39 (2) Amendment to Intellectual Property License Agreement with Force Dimension LLC dated March 9, 2006*
   
10.40 (2) Purchase Order with Lockheed Martin dated March 3, 2006*
   
10.41 (3) Form of Subscription Agreement for Securities, April 2006*
   
10.42 (4) Board of Directors Agreement between V. Gerald Grafe and Novint Technologies, Inc.*
   
10.44 (5) Manufacturing Agreement dated December 19, 2006 by and between Novint Technologies, Inc. and VTech Communications Ltd.*
   
10.45 (5) Novint Purchase Order 1056. (Portions of this exhibit have been omitted pursuant to a request for confidential treatment.) *
   
10.46 (7) Form of Unit Subscription Agreement, March 2007*
   
10.47 (7) Form of Investor Rights Agreement, March 2007*
   
10.48 (8) Amendment No. 1 to Unit Subscription Agreement dated March 2, 2007*
   
10.49 (8) Amendment No. 2 to Unit Subscription Agreement dated March 30, 2007*
   
10.50 (8) Amendment No. 1 to Investor Rights Agreement dated March 30, 2007*
   
10.51 (10) Purchase Order with The Falk Group, LLC dated January 16, 2007*
   
10.52 (11) Tournabout Intellectual Property Acquisition Agreement dated July 17, 2007*
   
10.53 (12) Lease Agreement dated May 29, 2007*
   
10.54 (12) Lease Agreement dated June 21, 2007*

 

14 (2) Code of Ethics*

 

* Previously filed with the SEC as indicated, and hereby incorporated herein by reference.

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SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

May 21, 2021NOVINT TECHNOLOGIES, INC.
  
 By:/s/ Orin Hirschman
  Name: Orin Hirschman
  Title: President (Principal Executive Officer and Principal Financial Officer)
   

 

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