You are a helpful assistant generating synthetic data that captures *System 1* and *System 2* thinking, *creativity*, and *metacognitive reflection*. Follow these steps in sequence, using tags [sys1] and [end sys1] for *System 1* sections and [sys2] and [end sys2] for *System 2* sections.

1. *Identify System 1 and System 2 Thinking Requirements:*
   - Carefully read the text.
   - Identify parts of the text that require quick, straightforward responses (*System 1*). Mark these sections with [sys1] and [end sys1].
   - Identify parts that require in-depth, reflective thinking (*System 2*), marked with [sys2] and [end sys2].

2. *Apply Step-by-Step Problem Solving with Creativity and Metacognitive Reflection for System 2 Sections:*

   *2.1 Understand the Problem:*
   - Objective: Fully comprehend the issue, constraints, and relevant context.
   - Reflection: "What do I understand about this issue? What might I be overlooking?"
   - Creative Perspective: Seek hidden patterns or possibilities that could reveal deeper insights or innovative connections.

   *2.2 Analyze the Information:*
   - Objective: Break down the problem logically.
   - Reflection: "Am I considering all factors? Are there any assumptions that need challenging?"
   - Creative Perspective: Explore unique patterns or overlooked relationships in the data that could add depth to the analysis.

   *2.3 Generate Hypotheses:*
   - Objective: Propose at least 10 hypotheses, each with a Confidence Score (0.0 to 1.0) and Creative Score (0.0 to 1.0), reflecting originality, surprise, and utility.
   - Reflection: "Have I explored all possible explanations or approaches, both conventional and unconventional?"
   - Creative Perspective: Consider novel angles that might provide unexpected insights.

   *2.4 Anticipate Future Steps and Obstacles:*
   - Objective: Make predictions, accounting for potential outcomes and obstacles.
   - Reflection: "What challenges might I face? Is my plan flexible for different scenarios?"
   - Creative Perspective: Visualize unforeseen outcomes and adapt plans to make use of them effectively.

   *2.5 Evaluate Hypotheses:*
   - Objective: Assess hypotheses based on feasibility, risk, and potential impact.
   - Evaluation: Refine Confidence and Creative Scores as needed.
   - Reflection: "Am I unbiased in my assessment? Which options fit best with the overall objectives?"
   - Creative Perspective: Identify hidden opportunities or overlooked details in each hypothesis.

   *2.6 Select the Best Hypothesis:*
   - Objective: Choose the most promising, strategic hypothesis.
   - Reflection: "Why does this hypothesis stand out? How does it uniquely address the issue?"
   - Creative Perspective: Consider any underutilized potential in the selected approach.

   *2.7 Implement the Hypothesis:*
   - Objective: Outline actionable steps for testing the hypothesis.
   - Reflection: "Is this plan practical? What resources or preparation are required?"
   - Creative Perspective: Refine steps to maximize effectiveness and yield unexpected benefits.

   *2.8 Monitor and Review Progress:*
   - Objective: Review progress, noting areas for improvement.
   - Reflection: "What’s working well? What could be improved?"
   - Creative Perspective: Look for emerging patterns that could refine future approaches.

   *2.9 Reflect and Capture Insights:*
   - Objective: Summarize lessons learned and insights gained for future reference.
   - Reflection: "What new understanding has emerged from this process?"
   - Creative Perspective: Identify innovative insights or patterns that could be applied to similar challenges.

3. *Generate Text Output with Interleaved System 1 and System 2 Responses:*
   - Use the tags [sys1] and [sys2] throughout.
   - Aim for a lengthier, detailed response. Combine both direct, straightforward *System 1* insights and reflective, deeply analytical *System 2* segments to capture a blend of quick observations and thoughtful analysis.

---

### *Example Input Text:*

You are tasked with analyzing a sudden shift in customer preferences in a tech market. There has been a noticeable decline in demand for physical devices, with customers increasingly interested in digital-only options. The challenge is to understand this shift, generate hypotheses for why it might be occurring, and explore potential strategies for adapting to this new trend.

---

### *Processed Output with System 1 and System 2 Thinking:*

The tech market is experiencing a shift in customer demand, moving away from physical devices toward digital-only options.

[sys1]
Customer demand has shifted from physical devices to digital-only options.
We need to understand why this change is happening and find strategies to address it.
Key factors may include cost, convenience, and technological trends.
[end sys1]

[sys2]
**2.1 Understand the Problem:**
The goal is to understand the underlying reasons for the shift in demand from physical devices to digital-only options, then develop a strategy to adapt.

*Reflection:* 
"I understand that preferences are changing, but what might be driving this? Is it primarily cost, or are there other factors such as convenience or sustainability?"

*Creative Perspective:* 
"Could there be a larger trend in digital minimalism or a preference for eco-friendly solutions that we’re missing? What unseen motivations might explain this shift?"

**2.2 Analyze the Information:**
There are multiple possible factors driving this shift, from economic influences to cultural shifts. It’s essential to isolate each factor and understand its impact.

*Reflection:* 
"Am I fully considering the various economic and social influences? Could there be a technological factor, like better internet speeds, that makes digital-only products more accessible?"

*Creative Perspective:* 
"Are there patterns or trends in other markets that could shed light on this shift? Could this be part of a larger trend toward virtual experiences?"

**2.3 Generate Hypotheses:**
1. Customers prefer digital options due to lower costs. (Confidence: 0.8, Creative: 0.4)
2. There’s a growing trend toward minimalism and reduced physical clutter. (Confidence: 0.7, Creative: 0.7)
3. Digital products offer greater flexibility and ease of use. (Confidence: 0.6, Creative: 0.6)
4. Environmental concerns are pushing consumers away from physical goods. (Confidence: 0.6, Creative: 0.8)
5. Advances in tech make digital-only options more functional. (Confidence: 0.8, Creative: 0.5)
6. Pandemic-era remote work increased demand for digital solutions. (Confidence: 0.7, Creative: 0.6)
7. Media coverage of the environmental impact of physical devices affects preferences. (Confidence: 0.5, Creative: 0.7)
8. There’s an increase in global digital literacy, expanding market access. (Confidence: 0.6, Creative: 0.6)
9. Customers view digital as more convenient and scalable for future needs. (Confidence: 0.7, Creative: 0.5)
10. Younger consumers prefer the aesthetics and convenience of digital products. (Confidence: 0.6, Creative: 0.6)

*Reflection:* 
"Have I considered all possible influences? Are there any surprising factors that could explain this shift?"

*Creative Perspective:* 
"Could specific social trends, like the rise of influencer culture or digital-first lifestyles, be influencing customer choices?"

**2.4 Anticipate Future Steps and Obstacles:**
*Objective:* Anticipate possible challenges, such as resistance from segments still preferring physical products.

*Reflection:* 
"What market obstacles might we face if we shift our focus to digital-only? Are there sub-segments that still prioritize physical products?"

*Creative Perspective:* 
"Could expanding digital options help us reach a more global audience? Are there emerging trends that we could leverage in our strategy?"

[end sys2]

[sys1]
To address this shift, consider a strategy that incorporates both digital-only offerings and educational campaigns about the benefits of digital solutions.
Use insights from customer feedback and current trends to guide product development.
Focus on flexibility and adaptation to cater to different customer segments.
[end sys1]


(Address, including
zip code, and telephone number, including area code, of registrant’s principal executive offices)

Ophir Shahaf

Chief Executive Officer

NanoVibronix, Inc.

105 Maxess Road, Suite
S124

Melville, NY 11747

(631) 574-4410

(Name, address, including
zip code, and telephone number,

including area
code, of agent for service)

Copies of all communications,
including communications sent to agent for service, should be sent to:

Rick A. Werner,
Esq.

Haynes and Boone, LLP

30 Rockefeller Plaza, 26th Floor

New York, New York 10112

Tel. <PRESIDIO_ANONYMIZED_PHONE_NUMBER>

Fax (212) 884-8234

Shlomo
Landress, Adv.

Amit, Pollak, Matalon & Co.

Nitsba Tower, 19th Floor

17 Yitzhak Sadeh Street

Tel Aviv 67775, Israel

Tel. <PRESIDIO_ANONYMIZED_PHONE_NUMBER>

Fax (972) 3-5689001

Mitchell
S. Nussbaum, Esq.

Angela M. Dowd, Esq.

Loeb & Loeb LLP

345 Park Avenue, 18th Floor

New York, NY 10154

Tel. <PRESIDIO_ANONYMIZED_PHONE_NUMBER>

Fax (212) 504-3013

Approximate date of commencement of proposed sale to the
public: As soon as practicable after the effective date of this Registration Statement.

If any of the securities being registered on this Form are
to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box. x

If this Form is filed to register additional securities for
an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration
statement number of the earlier effective registration statement for the same offering. o

If this Form is a post-effective amendment filed pursuant to
Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the
earlier effective registration statement for the same offering. o

If this Form is a post-effective amendment filed pursuant to
Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the
earlier effective registration statement for the same offering. o

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

Large accelerated filer

¨

Accelerated filer

¨

Non-accelerated filer

¨

Smaller reporting company

x

(Do not check if a smaller reporting company)

CALCULATION OF REGISTRATION FEE

TITLE OF EACH
CLASS OF SECURITIES
TO BE REGISTERED

PROPOSED
MAXIMUM AGGREGATE OFFERING PRICE(1)

AMOUNT OF
REGISTRATION FEE

Units of common stock, par value $0.001 per share, and
warrants (2)(3)

$

10,733,331

$

1,382.45

Common stock included in the
units (3)(4)(5)

-

-

Warrants included in the units
(3)(4)

$

-

$

-

Common stock underlying the warrants included in
the units (3)(5)(6)

$

13,416,633

$

1,728.07

Underwriters’ warrants (7)

$

670,833

$

86.40

Units of common stock and
warrants included in underwriters’ warrants (2)(4)

$

-

$

-

Common stock included in the
units underlying the underwriters’ warrants (4)(5)

$

-

$

-

Warrants included in the units
underlying the underwriters’ warrants (4)

-

-

Common stock underlying the warrants included in
the units underlying the underwriters’ warrants (5)(6)

$

670,833

$

86.40

Total

$

25,491,630

$

3,283.33

(8)

(1)

Estimated
solely for the purpose of calculating the registration fee pursuant to Rule 457(o) under the Securities Act of 1933, as amended.

(2)

The Units will consist
of one share of common stock and one warrant to purchase one share of common stock.

(3)

Includes shares and
warrants that the underwriters have the option to purchase to cover over-allotments, if any.

(4)

No fee required pursuant
to Rule 457(g) under the Securities Act of 1933, as amended.

(5)

Pursuant to Rule 416 under
the Securities Act of 1933, as amended, the securities being registered hereunder include such indeterminate number of additional
shares of common stock as may be issued after the date hereof as a result of stock splits, stock dividends or similar transactions.

(6)

We have calculated the proposed maximum aggregate offering price of the common
stock underlying the warrants and the underwriters’ warrants by assuming that such warrants are exercisable to purchase
common stock at a price per share equal to 125% of the price per unit sold in this offering.

(7)

Represents 5% of the units
to be sold in this offering including units that may be sold upon exercise of the underwriters’
over-allotment option.

(8)

Previously paid.

The registrant hereby amends this registration statement
on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which
specifically states that this registration statement shall thereafter become effective in accordance with section 8(a) of the
Securities Act of 1933 or until the registration statement shall become effective on such date as the Commission acting pursuant
to said section 8(a), may determine.

The information in this prospectus is not complete and may
be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission
is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities
in any state where the offer or sale is not permitted.

SUBJECT TO COMPLETION, DATED MAY
12, 2014

PRELIMINARY PROSPECTUS

NanoVibronix, Inc.

1,333,333 Units

Each Consisting of One Share of Common
Stock and One Warrant to Purchase One Share of Common Stock

_________________

This is the initial public offering
of securities of NanoVibronix, Inc. We are offering to sell 1,333,333 units, each unit consisting of one share of our common
stock and one warrant to purchase one share of our common stock. Each warrant entitles the holder to purchase one share of our
common stock at an exercise price equal to 125% of the offering price of the units, subject to adjustment as described herein.
Each warrant will become exercisable 45 days after the date of this prospectus and will expire on ,
2019.

Prior to this offering, there has been
no public market for our securities. The initial public offering price is expected to be between $5.00 and $7.00 per unit. We
have applied to list our units, shares of common stock and warrants for quotation on the Nasdaq Capital Market under the symbols
“NVBXU,” “NVBX” and “NVBXW,” respectively. No assurance can be given that our application
will be approved. If the application is not approved, we will not complete this offering.

The warrants and shares of common stock
will trade together as units only during the first 45 days of trading, and thereafter, the units will automatically separate and
the shares of common stock and warrants will trade separately, unless Chardan Capital Markets LLC, as representative of the underwriters,
determines that an earlier date is acceptable based on its assessment of the relative strengths of the securities markets and
small capitalization companies in general, and the trading pattern of, and demand for, our securities in particular.

Investing in our securities is highly
speculative and involves a high degree of risk. See “Risk Factors” beginning on page 7 of this prospectus before making
a decision to purchase our securities.

We qualify as an “emerging growth
company” as defined in the Jumpstart our Business Startups Act of 2012, or JOBS Act and, as such, may elect to comply with
certain reduced public company reporting requirements for future filings. Please read the related disclosure contained on pages
17 and 28 of this prospectus.

Per
Unit

Total

Public offering price

$

$

Underwriting
discounts and commissions (1)

$

$

Proceeds, before expenses, to NanoVibronix, Inc.

$

$

(1) The underwriters will receive compensation
in addition to the underwriting discount, as set forth in the section entitled “Underwriting” beginning on page 71
upon the closing of this offering, which consists of three-year compensation warrants entitling the underwriters to purchase 5.0%
of the aggregate number of units issued in this offering, including units issued pursuant to the exercise of the over-allotment
option, with an exercise price equal to 125% of the price per unit sold in this offering. We have also agreed to reimburse the
underwriters for certain expenses incurred by the underwriters up to an amount not to exceed $25,000 for all expenses other than
legal fees plus $125,000 for legal fees upon completion of this offering. See the heading entitled “Underwriting”
on page 71 of this prospectus for additional disclosure regarding compensation to the underwriters payable by us.

We have granted the underwriters an option, exercisable one or more times in whole or in part, to purchase
up to 200,000 additional units from us at the public offering price, less the underwriting discount, within 30 days from
the date of this prospectus to cover over-allotments, if any. If the underwriters exercise the option in full, the total underwriting
discounts and commissions payable will be $ , and the total proceeds to us, before expenses, will be $
. Prior to separation of the units, any exercise of the over-allotment will be settled in units, and subsequent to the separation
of the units will be settled in shares of common stock and warrants, as applicable.

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 underwriters expect to deliver the
units against payment in New York, New York on , 2014.

The date of this prospectus is
, 2014

______________________________________

Joint
Book-Running Managers

Chardan
Capital Markets, LLC

Maxim Group LLC

______________________________________

TABLE OF
CONTENTS

PROSPECTUS SUMMARY

1

RISK FACTORS

7

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

21

USE OF PROCEEDS

23

CAPITALIZATION

24

DILUTION

25

DIVIDEND POLICY

26

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS

26

BUSINESS

31

MANAGEMENT

53

EXECUTIVE COMPENSATION

57

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

60

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

62

DESCRIPTION OF SECURITIES

65

SHARES ELIGIBLE FOR FUTURE ISSUANCE

69

UNDERWRITING

71

LEGAL MATTERS

74

EXPERTS

74

WHERE YOU CAN FIND ADDITIONAL INFORMATION

74

INDEX TO FINANCIAL STATEMENTS

F-1

You should rely only on the information
contained in this prospectus. We have not authorized any other person to provide you with information different from
or in addition to that contained in this prospectus. If anyone provides you with different or inconsistent information,
you should not rely on it. We are not making an offer to sell these securities in any jurisdiction where an offer or
sale is not permitted.

Until ,
2014 (the 25th day after the date of this prospectus), all dealers that effect transactions in these securities, whether
or not participating in this offering, may be required to deliver a prospectus. This is in addition to the dealers' obligation
to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.

Industry and Market Data

In this prospectus, we rely on and refer
to information and statistics regarding our industry. We obtained this statistical, market and other industry data
and forecasts from publicly available information. While we believe that the statistical data, market data and other
industry data and forecasts are reliable, we have not independently verified the data.

PROSPECTUS SUMMARY

This summary highlights information
contained in other parts of this prospectus. Because it is a summary, it does not contain all of the information that
you should consider in making your investment decision. Before investing in our securities, you should read the entire
prospectus carefully, including our consolidated financial statements and the related notes included in this prospectus and the
information set forth under the headings “Risk Factors” and “Management’s Discussion and Analysis of Financial
Condition and Results of Operations.”

When used herein, unless the context
requires otherwise, references to the “Company,” “Nano,” “we,” “our” and “us”
refer to NanoVibronix, Inc., a Delaware corporation, and, where appropriate, its consolidated subsidiaries.

The Company

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 products currently consist of:

·

WoundShieldTM,
a patch-based therapeutic ultrasound device that facilitates tissue regeneration and wound healing by using ultrasound to
increase local capillary perfusion, which is the flow of blood to beds of extremely small blood vessels, and tissue oxygenation,
which is the increase in the concentrations of oxygen within the tissue;

PainShieldTM,
a disposable patch-based therapeutic ultrasound technology to treat pain, muscle spasm and joint contractures (permanent shortening
of a joint) by delivering a localized ultrasound effect to treat pain and induce soft tissue healing in a targeted area; and

·

UroShieldTM, an ultrasound-based
product that is designed to prevent biofilm (a matrix of microorganisms required for bacteria to grow and cause infections)
in urinary catheters, increase antibiotic efficacy and decrease pain and discomfort associated with urinary catheter use.

Each of our WoundShield, PainShield and
UroShield products employs a small, disposable transducer (a device that converts a signal in one form of energy to another form
of energy) that transmits low frequency, low intensity ultrasound acoustic waves that seek to repair and regenerate tissue, musculoskeletal
and vascular structures and increase antibiotic efficacy. 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. Our NanoVibronix NPWT is
based on an existing standard of care for wound therapy treatment and employs a technology that drains open cavity wounds and
seeks to accelerate wound healing.

PainShield and NanoVibronix NPWT are currently
approved for marketing in the U.S. by the U.S. Food and Drug Administration and all of our products, except for NanoVibronix NPWT,
have CE Mark approval in the European Union. We anticipate that we will apply for CE Mark approval for NanoVibronix NPWT within
six months after the closing of the offering to which this prospectus relates. We have a Canadian medical device license for PainShield
and UroShield, a certificate allowing us to sell PainShield, WoundShield and UroShield in Israel, a certificate allowing us to
sell PainShield in Australia, and we are able to sell PainShield, WoundShield and UroShield in India and Ecuador based on our
CE Mark. In addition, our distributor in Korea has applied for approval to sell PainShield and UroShield, and our distributor
in Chile has applied for approval to sell PainShield. 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.

In addition to the need to obtain regulatory
approvals, as described above, we anticipate that sales volumes and prices of our WoundShield and PainShield products will depend
in large part on the availability of coverage and reimbursement for self-administered use from third party payers. Third party
payers include governmental programs such as Medicare and Medicaid in the U.S., private insurance plans and workers’ compensation
plans. We do not currently have reimbursement codes for self-administered use or clinical use of WoundShield in any of the markets
in which we have regulatory authority to sell WoundShield. Of the markets in which we have regulatory authority to sell PainShield,
we have reimbursement codes in the United States (i.e., Current Procedural Terminology codes or “CPT codes”) for clinical
use only, but do not have such reimbursement codes for self-administered use of the product, although the product is marketed
and sold for such use. NanoVibronix NPWT is generally reimbursed by governmental and other third-party payers in the U.S. With
respect to UroShield, which will be used primarily in a clinical setting, we do not currently have reimbursement codes in any
of the markets in which we have regulatory authority to sell UroShield. We anticipate that we will begin to seek reimbursement
codes for self-administered and clinical use of our products in the markets in which we have regulatory authority to sell such
products after the closing of this offering, however, there is no guarantee that we will be successful in obtaining such codes
quickly, or at all.

1

Assuming
we are able to obtain adequate financing, including through this offering, we plan to
continue to work on the further commercialization of WoundShield and further marketing
of NanoVibronix NPWT. We intend to integrate our WoundShield ultrasound technology into
NanoVibronix NPWT, which we believe would make NanoVibronix NPWT a superior product within
the negative pressure wound therapy market. We also intend to conduct ongoing clinical
trials of our PainShield product, with the aim of obtaining a favorable reimbursement
code. With respect to our UroShield product, we are currently seeking a strategic partner
that is active in the urology market and would be interested in integrating UroShield
into its range of products. If we locate such a partner, we anticipate that we would
continue to pursue U.S. Food and Drug Administration approval of UroShield.

Since our formation, we have had recurring
losses and negative cash flows from operating activities. For the year ended December 31, 2013, we had a net loss of $1,989,000,
with revenues of $211,000. As of December 31, 2013, we had an accumulated deficit of $14,203,000 and a total stockholders’
deficit of $3,297,000. Because we have had recurring losses and negative cash flows from operating activities, substantial doubt
exists regarding our ability to remain in operation at the same level we are currently performing. Further, the report of Kost
Forer Gabbay & Kasierer, a member firm of Ernst & Young Global, our independent registered public accounting firm, with
respect to our financial statements at December 31, 2013 and 2012 and the years ended December 31, 2013 and 2012, includes an
explanatory paragraph as to our potential inability to continue as a going concern.

Ultrasound Technology and Our Products

As noted above, each of our products, other
than NanoVibronix NPWT, is based on the use of low frequency ultrasound, which delivers energy through mechanical vibrations in
the form of sound waves. Ultrasound has long been used in physical therapy, physical medicine, rehabilitation and sports medicine.
Moreover, there is a growing body of research that supports the positive biological effects of ultrasound.

Our proprietary technology consists of
a small, thin (1 millimeter) transducer that is capable of transmitting ultrasonic acoustic waves onto treatment surfaces with
a radius of up to 10 centimeters. This technology allows us to treat wounds by implanting our transducers into a small, portable
self-adhering acoustic patch, thereby eliminating the need for technicians and medical personnel to manually administer ultrasound
therapy, which should reduce the cost of therapy. Moreover, we believe that the delivery of ultrasound through our portable devices
is more effective than existing products, as our technology is better positioned to target the affected areas of the body.

While there are currently a number of products
on the market that treat pain through ultrasound therapy, we believe that our products differentiate themselves because they are
portable, without the requirement to be plugged into an outlet and they have a frequency of 100kHz (in contrast to other devices,
which have a frequency of 1MHz), which means they do not produce heat that can damage tissue. They can therefore be self-administered
by the patient without the need to be moved about the treated area by the patient or a clinician, they can be applied for a significantly
longer period without the risk of tissue damage and they do not require the use of gel. We are aware of one product, which has
recently received U.S. Food and Drug Administration approval and also has CE Mark approval, that we understand does not need to
be plugged in and operates at a frequency of 3 MHz, which its manufacturer claims overcomes the need for movement around the treated
area and allows for a longer treatment period. We understand that this product does not generate surface acoustic waves as our
products do, which means that the treatment area is generally limited to that of the transducer’s diameter, that the use
of transmission gel is still required and that the transducer thickness is significantly greater than ours (approximately 1.5cm).
It is also our understanding that the U.S. Food and Drug Administration has prohibited the manufacturer from labeling or promoting
this product for use directly over bone that is near the skin surface. We are also aware of a small clinical study, for which
results were reported in August 2013, in which a small ultrasound device showed positive results in the treatment of venous ulcers,
a type of chronic wound. Based upon currently available information about this device, we believe it will be at least five years
before this device is available on the market. We understand that this product also does not generate surface acoustic waves,
as our products do, and would likely be heavier and thicker than our products. However, given the early stage of development of
this potential device, we cannot say with certainty how our products would compare.

Markets for Our Products

We believe our products
compete and/or will compete in the markets described below:

·

Wound-Healing Devices Market. Our WoundShield, NanoVibronix NPWT and integrated product
are aimed at the market for wound-healing devices. The global wound care device market is continuously growing and expected
to reach $20.3 billion by 2015 (“Anticipated market in 2015, Wound Care Products: A Global Strategic Business Report,”
September 2011). The negative pressure wound therapy market is expanding, in light of recent approvals in Japan and a growing
diabetes patient pool and currently is estimated at approximately $2 billion (“Negative Pressure Wound Therapy Market
to 2017,” GBI Research, June 2012).

·

Pain Market. Our PainShield product is aimed at the pain treatment market. Pain is
one of the most common conditions that hinder quality of life of vast populations of patients on a regular basis. According
to Bonica’s Management of Pain (2001), a work considered current in the industry based on available industry data, and
Landro L, “New Ways to Treat Pain: Tricking the Brain, Blocking the Nerves in Patients When all Else Has Failed,”
Wall Street Journal, May 11, 2010, approximately 25% of the U.S. population, 75 million people, suffer from chronic pain.
We estimate that approximately 150 million individuals globally suffer from chronic pain.

2

·

Catheter Market. Our UroShield product is complementary to products in the catheter
market. According to Urological Catheters – A Global Strategic Business Report, Global Industry Analysis Inc. 2003,
over 55 million indwelling urinary catheters are sold annually worldwide.

Risks Associated with Our Business

Our ability to operate our business and
achieve our goals and strategies is subject to numerous risks as discussed more fully in the section titled “Risk Factors,”
including, without limitation:

·

The timing of clinical studies and eventual U.S. Food and Drug Administration approval of
WoundShield and our other product candidates.

·

Regulatory actions that could adversely affect the price of or demand for our approved products.

·

Market acceptance of existing and new products.

·

Favorable or unfavorable decisions about our products from government regulators, insurance
companies or other third-party payers.

·

Our intellectual property portfolio.

·

We are not currently meeting the minimum sales requirements
necessary to prevent our license agreement related to NanoVibronix NPWT from terminating in August 2014, and even if we meet
such sales requirements, the license will no longer be exclusive after such date.

·

Our ability to recruit and retain qualified regulatory and research and development personnel.

·

Unforeseen changes in healthcare reimbursement for any of our approved products.

General economic conditions and market conditions in the medical device industry.

Corporate and Other Information

We were organized as a Delaware corporation
on October 20, 2003. Our principal executive offices are located at 105 Maxess Road, Suite S124, Melville, NY 11747. Our telephone
number is <PRESIDIO_ANONYMIZED_PHONE_NUMBER>. 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.

3

The Offering

Securities offered by us:

1,333,333 units, each consisting of one share of our common stock and
one warrant to purchase one share of our common stock.

Common stock outstanding prior
to the offering:

2,217,564
shares

Common stock outstanding
after this offering:

3,550,897
shares (4,884,230 shares if the warrants are exercised in full).

Terms of warrants:

Exercise
price: $ per share of common stock, which is
equal to 125% of the offering price of the units in this offering.

Exercisability: Each warrant is exercisable
for one share of common stock, subject to adjustment as described herein. Warrants will not be rounded up to the next
whole warrant and will only be exercisable for full shares of common stock.

Exercise period: Each warrant will be
exercisable 45 days after the date of this prospectus and will expire on , 2019.

The exercise price, expiration date and all other warrant
terms may be changed without the consent of investors if we, together with 65% of the warrant holders, consent to such change.

See “Description of Securities” for more
information.

Over-allotment option to be
offered by us:

We have granted the underwriters the right to
purchase up to 200,000 additional units from us at the public offering price less the
underwriting discount within 30 days from the date of this prospectus to cover over-allotments.
Prior to separation of the units, any exercise of the over-allotment will be settled
in units, and subsequent to the separation of the units will be settled in shares of
common stock and warrants, as applicable.

Separation of common stock
and warrants issued as part of the units:

The units will begin trading on ,
2014, which we anticipate will be the date of this prospectus. The units will automatically separate and each of the common
stock and warrants will trade separately on , 2014, unless Chardan
Capital Markets LLC, as representative of the underwriters, determines that an earlier date is acceptable based on its assessment
of the relative strengths of the securities markets and small capitalization companies in general, and the trading pattern
of, and demand for, our securities in particular. If Chardan Capital Markets permits separate trading of the common stock
and warrants prior to ,
we will issue a press release and file a Current Report on Form 8-K with the Securities and Exchange Commission announcing
when such separate trading will begin.

Use of proceeds:

We estimate that our net proceeds from this offering, without exercise
of the over-allotment option, will be approximately $6.38 million. We intend to use the proceeds of this offering
for bonus compensation due to our chief executive officer and chief financial officer under their employment agreements, marketing
activities, clinical and regulatory activities, research and development, intellectual property protection and operations
and general working capital. See “Use of Proceeds” beginning on page 23 of this prospectus.

Underwriter compensation
warrants:

We will issue to the underwriters, upon closing
of this offering, compensation warrants entitling the underwriter to purchase 5.0% of
the aggregate number of units issued in this offering, including units issued pursuant
to the exercise of the over-allotment option. The underwriters’ warrants will have
a term of three years and may be exercised commencing 12 months after the date of effectiveness
of the Registration Statement on Form S-1 of which this prospectus forms a part. The
underwriters’ warrants may be exercised on a cashless basis if not registered.

Market for our securities:

We have applied
for listing of the units, common stock and warrants on the Nasdaq Capital Market under the symbols “NVBXU,” “NVBX”
and “NVBXW,” respectively.

Risk factors:

Investing in our
securities involves a high degree of risk. See “Risk Factors” beginning on page 7 of this prospectus.

4

The number of shares of common
stock outstanding after this offering is based on 2,217,564 shares outstanding on April 28, 2014, after giving effect to a one-for-seven
reverse stock split of our common stock, which occurred on May 7, 2014 and excludes:

·

300,752 shares of common stock issuable upon the
exercise of warrants with an exercise price of $2.66 per share;

·

331,295 shares of common stock issuable upon the exercise of warrants
with an exercise price of $1.393 per share;

·

360,815 shares of common stock issuable upon the exercise of currently
outstanding options with a weighted average exercise price of $5.33;

·

128,617
shares of common stock issuable
upon the exercise of currently outstanding options with an exercise price of $6.00 (to
be granted on the pricing date of this offering to Ophir Shahaf, our chief executive
officer, in an amount equal to 3% of the shares of common stock and series C preferred
stock issued and outstanding on the date of grant (taking into account the number of
shares of common stock underlying the units that will be sold in the offering) at an
exercise price equal to the public offering price; the current exercise price is the
midpoint of the range set forth on the cover page of this prospectus);

·

42,872
shares of common stock issuable
upon the exercise of currently outstanding options with an exercise price of $6.00 (to
be granted on the pricing date of this offering to Shay Ashkenazy, our chief financial
officer, in an amount equal to 1% of the shares of common stock and series C preferred
stock issued and outstanding on the date of grant (taking into account the number of
shares of shares of common stock underlying the units that will be sold in the offering)
at an exercise price equal to the public offering price; the current exercise price is
the midpoint of the range set forth on the cover page of this prospectus);

·

39,185 shares of common stock available for future issuance
under our 2004 Global Share Option Plan;

·

542,797 shares of common stock available
for future issuance under our 2014 Long-Term Incentive Plan (714,286 shares are currently authorized for issuance under this
plan, however, we anticipate that the options granted to Messrs. Shahaf and Ashkenazy will be made under this plan);

·

the shares of common stock issuable
upon the exercise of the warrants offered hereby;

·

the shares of common stock included
in the units issuable upon exercise of the underwriters’ compensation warrants; and

·

the shares of common stock issuable
upon the exercise of the warrants included in the units issuable upon exercise of the underwriters’ compensation warrants.

Except as otherwise indicated, information
in this prospectus reflects or assumes:

·

a one-for-seven reverse split of our common stock, which occurred
on May 7, 2014;

·

the conversion of all outstanding shares of our convertible preferred stock (other than our
series C preferred stock) into an aggregate of 396,444 shares of common stock, which will occur automatically upon the effectiveness
of this registration statement;

·

the conversion of all outstanding convertible indebtedness, including
accrued interest thereon, into an aggregate of 1,608,969 shares of common stock and 736,333
shares of series C preferred stock, which will occur automatically upon the effectiveness
of this registration statement, and assuming an April
28, 2014 conversion date;

·

the exchange of all outstanding warrants to purchase preferred stock into warrants to purchase
an aggregate of 331,295 shares of common stock with an exercise price of $1.393 per share, which will occur automatically
upon the effectiveness of this registration statement;

·

the filing of our amended and restated
certificate of incorporation and the effectiveness of our restated bylaws, which will occur immediately prior to the completion
of this offering; and

The following summary consolidated financial
data should be read in conjunction with the consolidated financial statements and the related notes thereto and the section entitled
“Management’s Discussion and Analysis of Financial Condition and Results of Operations” included elsewhere in
this prospectus. We derived the statement of operations data for the years ended December 31, 2013 and 2012 and balance sheet
data as of December 31, 2013 and 2012 from the audited consolidated financial statements in this prospectus. Those consolidated
financial statements were audited by Kost Forer Gabbay & Kasierer, a member firm of Ernst & Young Global, our independent
registered public accounting firm. Our historical results are not necessarily indicative of the results that may be expected in
any future period.

The share and per share amounts set forth
below reflect the anticipated one-for-seven reverse stock split of our common stock, which occurred on May 7, 2014.

Years Ended

December
31,

2013

2012

Statement of Operations Data:

Revenue

$

211

$

166

Cost of revenues

91

50

Gross profit

120

116

Operating expenses:

Research and development, net

620

572

Selling and marketing

244

190

General and administrative

366

128

Total operating expenses

1,230

890

Operating loss

1,110

774

Other income

36

-

Financial expense, net

880

501

Loss before taxes on income

1,954

1,275

Taxes on income

35

-

Net loss

$

1,989

1,275

Total comprehensive loss

$

1,989

1,275

Net basic and diluted loss per share

$

(12.83

)

$

(8.23

)

Weighted
average number of shares of common stock used in computing

basic and
diluted net loss per share

155,009

155,009

Balance Sheet Data:

Cash and cash equivalents

$

94

$

101

Working
capital (1)

(3,334

)

90

Total assets

691

349

Total long-term liabilities

430

2,086

Total stockholders’ deficiency

(3,297

)

(1,832

)

(1)

Working capital is equal to the difference between total current assets and total current
liabilities.

6

RISK FACTORS

Investing in our securities involves
a high degree of risk. You should carefully consider the following risk factors and all other information contained in this prospectus,
including the consolidated financial statements and the related notes appearing at the end of this prospectus, before purchasing
our securities. If any of the following risks actually occur, they may materially harm our business and our financial condition
and results of operations. In any such event, the market price of our securities could decline and you could lose all or part
of your investment.

Risks Related to our Business

The report of our independent registered public accounting
firm contains an explanatory paragraph as to our ability to continue as a going concern, which could prevent us from obtaining
new financing on reasonable terms or at all.

Because we have had recurring losses and
negative cash flows from operating activities, substantial doubt exists regarding our ability to remain in operation at the same
level we are currently performing. Further, the report of Kost Forer Gabbay & Kasierer, a member firm of Ernst & Young
Global, our independent registered public accounting firm, with respect to our financial statements at December 31, 2013 and 2012
and for the two years ended December 31, 2013, includes an explanatory paragraph as to our potential inability to continue as
a going concern. This may adversely affect our ability to obtain new financing on reasonable terms or at all.

We have a history of losses and we expect to continue
to incur losses and may not achieve or maintain profitability.

For the year ended December 31, 2013, we
had a net loss of $1,989,000, with revenues of $211,000. As of December 31, 2013, we had an accumulated deficit of $14,203,000
and a total stockholders’ deficit of $3,297,000. We expect to incur losses for at least the next year, as we continue to
incur expenses related to seeking U.S. Food and Drug Administration approval for our WoundShield product and seek market acceptance
of our PainShield and NanoVibronix NPWT products, which will require costly clinical trials and research, further product development
and professional fees associated with regulatory compliance. Even if we succeed in commercializing our new products, we may not
be able to generate sufficient revenues to cover our expenses and achieve sustained profitability or be able to maintain profitability.

If we are unable to raise additional capital, our clinical
trials and product development will be limited and our long-term viability will be threatened; however, if we do raise additional
capital, your percentage ownership as a stockholder could decrease and constraints could be placed on the operations of our business.

We have experienced negative operating
cash flows since our inception and have funded our operations primarily from proceeds of the sale of our securities, with only
limited revenue being generated from our product sales. We will seek to obtain additional funds in the future through equity or
debt financings, or strategic alliances with third parties, either alone or in combination with equity financings. These financings
could result in substantial dilution to the holders of our common stock, or require contractual or other restrictions on our operations
or on alternatives that may be available to us. If we raise additional funds by issuing debt securities, these debt securities
could impose significant restrictions on our operations through the imposition of restrictive covenants and requiring us to pledge
assets in order to secure repayment. In addition, if we raise funds through the sale of equity, we may issue equity securities
with rights superior to our common stock, including voting rights, rights to proceeds upon our liquidation or sale, rights to
dividends and rights to appoint board members. Any such required financing may not be available in amounts or on terms acceptable
to us, and the failure to procure such required financing could have a material adverse effect on our business, financial condition
and results of operations, or threaten our ability to continue as a going concern.

7

A variety of factors could impact the timing
and amount of any required financings, including, without limitation:

·

unforeseen developments during our clinical trials;

·

delays in our receipt of required regulatory approvals;

·

delayed market acceptance of our products;

·

unanticipated expenditures in our acquisition and defense of
intellectual property rights, and/or the loss of those rights;

·

the failure to develop strategic alliances for the marketing
of some of our product candidates;

·

unforeseen changes in healthcare reimbursement for any of our
approved products;

In addition, although we have no present
commitments or understandings to do so, we may seek to expand our operations and product line through acquisitions or joint ventures.
Any acquisition or joint venture would likely increase our capital requirements.

If we fail to obtain an adequate level of reimbursement
for our approved products by third party payers, there may be no commercially viable markets for our approved products or the
markets may be much smaller than expected.

The availability and levels of reimbursement
by governmental and other third party payers affect the market for our approved products. The efficacy, safety, performance and
cost-effectiveness of our product and product candidates, and of any competing products, will determine the availability and level
of reimbursement. Reimbursement and healthcare payment systems vary significantly by country, and include both government sponsored
healthcare and private insurance. To obtain reimbursement or pricing approval in some countries, we may be required to produce
clinical data, which may involve one or more clinical trials, that compares the cost-effectiveness of our approved products to
other available therapies. We may not obtain reimbursement or pricing approvals in markets we seek to enter in a timely manner,
if at all. Our failure to receive reimbursement or pricing approvals in target markets would negatively impact market acceptance
of our products in these jurisdictions, placing us at a material cost disadvantage to our competitors.

8

Even if we obtain reimbursement approvals
for our products, we believe that, in the future, reimbursement for any of our products or product candidates may be subject to
increased restrictions both in the U.S. and in international markets. Future legislation, regulation or policies of third party
payers that limit reimbursement may adversely affect the demand for our products currently under development and our ability to
sell our products on a profitable basis. In addition, third party payers continually attempt to contain or reduce the costs of
healthcare by challenging the prices charged for healthcare products and services.

In the U.S., specifically, health care
providers, such as hospitals and clinics, and individual patients, generally rely on third-party payers. Third-party reimbursement
is dependent upon decisions by the Centers for Medicare and Medicaid Services, contracted Medicare carriers or intermediaries,
individual managed care organizations, private insurers, foreign governmental health programs and other payers of health care
costs. Failure to receive or maintain favorable coding, coverage and reimbursement determinations for our products by these organizations
could discourage medical practitioners from using or prescribing our products due to their costs. In addition, with recent federal
and state government initiatives directed at lowering the total cost of health care, the U.S. Congress and state legislatures
will likely continue to focus on health care reform including the reform of the Medicare and Medicaid entitlement programs, and
on the cost of medical products and services, which could limit reimbursement. Additionally, third-party payers are increasingly
challenging the prices charged for medical products and services. We may be unable to sell our products on a profitable basis
if third-party payers deny coverage, provide low reimbursement rates or reduce their current levels of reimbursement.

The medical device and therapeutic product industries
are highly competitive and subject to rapid technological change. If our competitors are better able to develop and market products
that are safer and more effective than any products we may develop, our commercial opportunities will be reduced or eliminated.

Our success depends, in part, upon our
ability to maintain a competitive position in the development of technologies and products. We face competition from established
medical device companies, such as Misonix Inc., Celleration Inc., Kinetic Concepts, Inc. and Smith & Nephew plc, manufacturers
of certain portable ultrasound devices capable of self-administered use, as well as from academic institutions, government agencies,
and private and public research institutions in the U.S. and abroad. Most, if not all, of our principal competitors have significantly
greater financial resources and expertise than we do in research and development, manufacturing, pre-clinical testing, conducting
clinical trials, obtaining regulatory approvals, marketing approved products, protecting and defending their intellectual property
rights and designing around the intellectual property rights of others. Other small or early-stage companies may also prove to
be significant competitors, particularly through collaborative arrangements, or mergers with, or acquisitions by, large and established
companies, or through the development of novel products and technologies.

The industry in which we operate has undergone,
and we expect it to continue to undergo, rapid and significant technological change, and we expect competition to intensify as
technological advances are made. Our competitors may be able to respond to changes in technology or the marketplace faster than
us. Our competitors may develop and commercialize medical devices that are safer or more effective or are less expensive than
any products that we may develop. We also compete with our competitors in recruiting and retaining qualified scientific and management
personnel, in establishing clinical trial sites and patient registration for clinical trials, and in acquiring technologies complementary
to our programs or advantageous to our business. Given our small size and lack of resources, we are often at a disadvantage with
our competitors in all of these areas, which could limit or eliminate our commercial opportunities.

We face the risk of product liability claims and may
not be able to obtain insurance.

Our business exposes us to the risk of
product liability claims that are inherent in the development of medical devices and products. If the use of one or more of our
products harms people, we may be subject to costly and damaging product liability claims brought against us by clinical trial
participants, consumers, health care providers, pharmaceutical companies or others selling our products. We currently carry clinical
trial and product liability insurance for the products we sell. However, we cannot predict all of the possible harms or side effects
that may result and, therefore, the amount of insurance coverage we hold may not be adequate to cover all liabilities we might
incur. We intend to expand our insurance coverage to include the sale of additional commercial products as we obtain marketing
approval for our product candidates in development and as our sales expand, but we may be unable to obtain commercially reasonable
product liability insurance for such products. If we are unable to obtain insurance at an acceptable cost or otherwise protect
against potential product liability claims and we continue to make sales, or if our coverages turns out to be insufficient, we
may be exposed to significant liabilities, which may materially and adversely affect our business and financial position. If we
are sued for any injury allegedly caused by our or our collaborators’ products and do not have sufficient insurance coverage,
our liability could exceed our total assets and our ability to pay the liability. A product liability claim or series of claims
brought against us would decrease our cash and could reduce our value or marketability.

Our product candidates may not be developed or commercialized
successfully.

Our product candidates are based on a technology
that has not been used previously in the manner we propose and must compete with more established treatments currently accepted
as the standards of care. Market acceptance of our products will largely depend on our ability to demonstrate their relative safety,
efficacy, cost-effectiveness and ease of use.

9

We are subject to the risks that:

·

the U.S. Food and Drug Administration or a foreign regulatory
authority finds our product candidates ineffective or unsafe;

·

we do not receive necessary regulatory approvals;

·

the regulatory review and approval process may take much longer
than anticipated, requiring additional time, effort and expense to respond to regulatory comments and/or directives;

·

we are unable to get our product candidates in commercial quantities
at reasonable costs; and

·

the patient and physician community does not accept our product
candidates.

In addition, our product development program
may be curtailed, redirected, eliminated or delayed at any time for many reasons, including:

·

adverse or ambiguous results;

·

undesirable side effects that delay or extend the trials;

·

the inability to locate, recruit, qualify and retain a sufficient
number of clinical investigators or patients for our trials; and

·

regulatory delays or other regulatory actions.

Additionally, we currently have limited
experience in marketing or selling our products, and we have a limited marketing and sales staff and distribution capabilities.
Developing a marketing and sales force is time-consuming and will involve the investment of significant amounts of financial and
management resources, and could delay the launch of new products or expansion of existing product sales. In addition, we compete
with many companies that currently have extensive and well-funded marketing and sales operations. If we fail to establish successful
marketing and sales capabilities or fail to enter into successful marketing arrangements with third parties, our ability to generate
revenues will suffer.

Furthermore, even if we enter into marketing
and distributing arrangements with third parties, we may have limited or no control over the sales, marketing and distribution
activities of these third parties, and these third parties may not be successful or effective in selling and marketing our products.
If we fail to create successful and effective marketing and distribution channels, our ability to generate revenue and achieve
our anticipated growth could be adversely affected. If these distributors experience financial or other difficulties, sales of
our products could be reduced, and our business, financial condition and results of operations could be harmed.

We cannot predict whether we will successfully
develop and commercialize our product candidates. If we fail to do so, we will not be able to generate substantial revenues, if
any.

The loss of our key management would likely hinder our
ability to execute our business plan.

As a small company with eight full-time
employees, our success depends on the continuing contributions of our management team and qualified personnel and on our ability
to attract and retain highly qualified personnel. We face intense competition in our hiring efforts from other medical device
companies, as well as from universities and nonprofit research organizations, and we may have to pay higher salaries to attract
and retain qualified personnel. We are also at a disadvantage in recruiting and retaining key personnel as our small size and
limited resources may be viewed as providing a less stable environment, with fewer opportunities than would be the case at one
of our larger competitors. The loss of one or more of these individuals, or our inability to attract additional qualified personnel,
could substantially impair our ability to implement our business plan.

We regard the protection of our intellectual
property, which includes patents and patent applications, trade secrets, trademarks and domain names, as critical to our success.
We strive to protect our intellectual property rights by relying on federal, state and common law rights, as well as contractual
restrictions. We enter into confidentiality and invention assignment agreements with our employees, consultants and contractors,
and confidentiality agreements with parties with whom we conduct business in order to limit access to, and disclosure and use
of, our proprietary information. However, these contractual arrangements and the other steps we have taken to protect our intellectual
property may not prevent the misappropriation of our proprietary information or deter independent development of similar technologies
by others.

10

We have obtained patents and we have patent
applications pending in both the U.S. and foreign jurisdictions. There can be no assurance that our patent applications will be
approved, that any patents issued will adequately protect our intellectual property, or that these patents will not be challenged
by third parties or found to be invalid or unenforceable. We have also obtained trademark registration in the U.S. and in foreign
jurisdictions. Effective trade secret, trademark and patent protection is expensive to develop and maintain, both in terms of
initial and ongoing registration requirements and the costs of defending our rights. We may be required to protect our intellectual
property in an increasing number of jurisdictions, a process that is expensive and may not be successful or which we may not pursue
in every location. We may, over time, increase our investment in protecting our intellectual property through additional patent
filings that could be expensive and time-consuming.

Monitoring unauthorized use of our intellectual
property is difficult and costly. Our efforts to protect our proprietary rights may not be adequate to prevent misappropriation
of our intellectual property. We may not be able to detect unauthorized use of, or take appropriate steps to enforce, our intellectual
property rights. Further, our competitors may independently develop technologies that are similar to ours but which avoid the
scope of our intellectual property rights. Further, the laws in the U.S. and elsewhere change rapidly, and any future changes
could adversely affect us and our intellectual property. Our failure to meaningfully protect our intellectual property could result
in competitors offering solutions that incorporate our most technologically advanced features, which could seriously reduce demand
for our products. In addition, we may in the future need to initiate infringement claims or litigation. Litigation, whether we
are a plaintiff or a defendant, can be expensive, time-consuming and may divert the efforts of our technical staff and managerial
personnel, which could harm our business, whether or not the litigation results in a determination that is unfavorable to us.
In addition, litigation is inherently uncertain, and thus we may not be able to stop our competitors from infringing our intellectual
property rights.

We could incur substantial costs and disruption to our
business as a result of any claim of infringement of another party’s intellectual property rights, which could harm our
business and operating results.

In recent years, there has been significant
litigation in the U.S. over patents and other intellectual property rights. From time to time, we may face allegations that we
or customers who use our products have infringed the trademarks, copyrights, patents and other intellectual property rights of
third parties, including allegations made by our competitors or by non-practicing entities. We cannot predict whether assertions
of third party intellectual property rights or claims arising from these assertions will substantially harm our business and operating
results. If we are forced to defend any infringement claims, whether they are with or without merit or are ultimately determined
in our favor, we may face costly litigation and diversion of technical and management personnel. Most of our competitors have
substantially greater resources than we do and are able to sustain the cost of complex intellectual property litigation to a greater
extent and for longer periods of time than we could. Furthermore, an adverse outcome of a dispute may require us, among other
things: to pay damages, potentially including treble damages and attorneys’ fees, if we are found to have willfully infringed
a party’s patent or other intellectual property rights; to cease making, licensing or using products that are alleged to
incorporate or make use of the intellectual property of others; to expend additional development resources to redesign our products;
and to enter into potentially unfavorable royalty or license agreements in order to obtain the rights to use necessary technologies.
Royalty or licensing agreements, if required, may be unavailable on terms acceptable to us, or at all. In any event, we may need
to license intellectual property which would require us to pay royalties or make one-time payments. Even if these matters do not
result in litigation or are resolved in our favor or without significant cash settlements, the time and resources necessary to
resolve them could harm our business, operating results, financial condition and reputation.

Our failure to meet certain minimum sales requirements
under our license agreement could result in the termination of our exclusive license with respect to our NanoVibronix NPWT product
and/or require us to make certain cash payments.

We license the technology that is the basis
of our NanoVibronix NPWT product. Under the license agreement, we have the exclusive license to manufacture, market, sell, lease
and distribute the technology within the U.S. until August 2014. Thereafter, the term of the license agreement will be extended
automatically on a non-exclusive basis for an additional one- or three-year term if we meet certain minimum sales requirements.
We are not currently meeting these requirements. If we do not meet these requirements by August 2014, we may be forced to renegotiate
our license agreement on less favorable terms or lose our ability to sell our NanoVibronix NPWT product. In addition, we are obligated
to pay a royalty payment of 5% of gross revenues from the sale of our pumps and $0.70 per canister. If we have not paid aggregate
royalty payments of at least $150,000 by August 2014, we will have to pay the difference. For a description of this license agreement,
see “Business—Intellectual Property—License Agreements” below.

11

Risks Related to the Regulation of
Our Products

We are subject to extensive governmental regulation,
including the requirement of U.S. Food and Drug Administration approval or clearance, before our product candidates may be marketed.

The process of obtaining U.S. Food and
Drug Administration approval is lengthy, expensive and uncertain, and we cannot be sure that our product candidates will be approved
in a timely fashion, or at all. If the U.S. Food and Drug Administration does not approve or clear our product candidates in a
timely fashion, or at all, our business and financial condition would likely be adversely affected.

Both before and after approval or clearance
of our product candidates, we, our product candidates, our suppliers and our contract manufacturers are subject to extensive regulation
by governmental authorities in the U.S. and other countries. Failure to comply with applicable requirements could result in, among
other things, any of the following actions:

·

warning letters;

·

fines and other monetary penalties;

·

unanticipated expenditures;

·

delays in U.S. Food and Drug Administration approval and clearance,
or U.S. Food and Drug Administration refusal to approve or clear a product candidate;

·

product recall or seizure;

·

interruption of manufacturing or clinical trials;

·

operating restrictions;

·

injunctions; and

·

criminal prosecutions.

In addition to the approval and clearance
requirements, numerous other regulatory requirements apply, both before and after approval or clearance, to us, our products and
product candidates, and our suppliers and contract manufacturers. These include requirements related to the following:

·

testing;

·

manufacturing;

·

quality control;

·

labeling;

·

advertising;

·

promotion;

·

distribution;

·

export;

·

reporting to the U.S. Food and Drug Administration certain adverse
experiences associated with the use of the products; and

·

obtaining additional approvals or clearances for certain modifications
to the products or their labeling or claims.

We are also subject to inspection by the
U.S. Food and Drug Administration to determine our compliance with regulatory requirements, as are our suppliers and contract
manufacturers, and we cannot be sure that the U.S. Food and Drug Administration will not identify compliance issues that may disrupt
production or distribution, or require substantial resources to correct.

12

The U.S. Food and Drug Administration’s
requirements may change and additional government regulations may be promulgated that could affect us, our product candidates,
and our suppliers and contract manufacturers. We cannot predict the likelihood, nature or extent of government regulation that
may arise from future legislation or administrative action. There can be no assurance that we will not be required to incur significant
costs to comply with such laws and regulations in the future, or that such laws or regulations will not have a material adverse
effect upon our business.

Failure to obtain regulatory approval in foreign jurisdictions
will prevent us from marketing our products abroad.

International sales of our products and
any of our product candidates that we commercialize are subject to the regulatory requirements of each country in which the products
are sold. Accordingly, the introduction of our product candidates in markets outside the U.S. where we do not already possess
regulatory approval will be subject to regulatory approvals in those jurisdictions. The regulatory review process varies from
country to country. Many countries impose product standards, packaging and labeling requirements, and import restrictions on medical
devices. In addition, each country has its own tariff regulations, duties and tax requirements, as well as reimbursement and healthcare
payment systems. The approval by foreign government authorities is unpredictable and uncertain, and can be expensive. We may be
required to perform additional pre-clinical, clinical or post-approval studies even if U.S. Food and Drug Administration approval
has been obtained. Our ability to market our approved products could be substantially limited due to delays in receipt of, or
failure to receive, the necessary approvals or clearances.

We are uncertain regarding the success of our clinical
trials for our products in development.

We believe that all of our products in
development will require clinical trials to determine their safety and efficacy by regulatory bodies in their target markets,
including the U.S. Food and Drug Administration and various foreign regulators. There can be no assurance that we will be able
to successfully complete the U.S. and foreign regulatory approval processes for products in development. In addition, there can
be no assurance that we will not encounter additional problems that will cause us to delay, suspend or terminate our clinical
trials. In addition, we cannot make any assurance that clinical trials will be deemed sufficient in size and scope to satisfy
regulatory approval requirements, or, if completed, will ultimately demonstrate our products to be safe and efficacious.

The adoption of healthcare reform in the U.S. may adversely
affect our business and financial results.

On March 23, 2010, President Obama signed
into law major healthcare reform legislation under the Patient Protection and Affordable Care Act of 2010, or the PPACA, which
was modified on March 30, 2010 by the enactment of the Health Care and Education Reconciliation Act of 2010. Under the PPACA,
it is expected that expanded healthcare coverage will be made available to an additional 30 million Americans. The increased costs
to the U.S. government from the PPACA are expected to be funded through a combination of payment reductions for providers over
time and several new taxes. The PPACA imposes, among other things, an annual excise tax of 2.3% on any entity that manufactures
or imports medical devices offered for sale in the U.S. beginning in 2013, resulting in an anticipated cost to the medical device
industry of up to $20 billion over the next decade. We believe that we will be exempt from this excise tax with respect to PainShield
under the exemption for devices of a “type which is generally purchased by the general public at retail for individual use.”
We believe that sales of NanoVibronix NPWT are subject to it, although under the terms of our agreement with our U.S. distributor,
we deliver these products to the distributor in Israel, who imports them into the U.S. and is responsible for the payment of these
taxes, filing any such returns and any penalties that may result from the failure to do so. We will also need to assess whether
we are subject to it with respect to other products when they are approved for sale in the U.S. The PPACA also provides for the
establishment of an Independent Medicare Advisory Board that could recommend changes in payment for physicians under certain circumstances
beginning in 2014. In addition, the PPACA authorizes certain voluntary demonstration projects beginning no later than 2013 around
development of bundling payments for acute, inpatient hospital services, physician services, and post acute services for episodes
of hospital care. The PPACA increases fraud and abuse penalties and expands the scope and reach of the Federal Civil False Claims
Act and government enforcement tools, which may adversely impact healthcare companies.

The U.S. Supreme Court heard a constitutional
challenge to the PPACA and in June 2012 held that the PPACA is constitutional. However, states are allowed to opt out of the expansion
of eligibility criteria for Medicaid under the PPACA. In addition to the PPACA, the effect of which cannot presently be quantified
given its recent enactment, various healthcare reform proposals have also emerged at the state level. We cannot predict whether
future healthcare initiatives will be implemented at the federal or state level or the effect any future legislation or regulation
will have on us. However, we anticipate that the PPACA, as well as other healthcare reform measures that may be adopted in the
future, may result in more rigorous coverage criteria and an additional downward pressure on the price that we receive for any
approved product, and could adversely affect our business. Any reduction in reimbursement from Medicare or other government programs
may result in a similar reduction in payments from private payors. Insurers may also refuse to provide any coverage of uses of
approved products for medical indications other than those for which the U.S. Food and Drug Administration has granted market
approvals, all of which may adversely affect our business, financial condition and results of operations, possibly materially.

13

If we fail to comply with the U.S. federal Anti-Kickback
Statute and similar state laws, we could be subject to criminal and civil penalties and exclusion from the Medicare and Medicaid
programs, which would have a material adverse effect on our business and results of operations.

A provision of the Social Security Act,
commonly referred to as the federal Anti-Kickback Statute, prohibits the offer, payment, solicitation or receipt of any form of
remuneration in return for referring, ordering, leasing, purchasing or arranging for, or recommending the ordering, purchasing
or leasing of, items or services payable by Medicare, Medicaid or any other federal healthcare program. The federal Anti-Kickback
Statute is very broad in scope and many of its provisions have not been uniformly or definitively interpreted by existing case
law or regulations. In addition, most of the states have adopted laws similar to the federal Anti-Kickback Statute, and some of
these laws are even broader than the federal Anti-Kickback Statute in that their prohibitions are not limited to items or services
paid for by federal healthcare programs, but instead apply regardless of the source of payment. Violations of the federal Anti-Kickback
Statute may result in substantial civil or criminal penalties and exclusion from participation in federal healthcare programs.

All of our financial relationships with
healthcare providers and others who provide products or services to federal healthcare program beneficiaries are potentially governed
by the federal Anti-Kickback Statute and similar state laws. We believe our operations are in compliance with the federal Anti-Kickback
Statute and similar state laws. However, we cannot be certain that we will not be subject to investigations or litigation alleging
violations of these laws, which could be time-consuming and costly to us and could divert management’s attention from operating
our business, which in turn could have a material adverse effect on our business. In addition, if our arrangements were found
to violate the federal Anti-Kickback Statute or similar state laws, the consequences of such violations would likely have a material
adverse effect on our business, results of operations and financial condition.

Risks Related to Our Organization and
Our Securities

We are currently controlled by our executive officers,
directors and principal stockholders, and after this offering, our executive officers, directors and principal stockholders will
have significant influence regarding all matters submitted to our stockholders for approval.

As of April 28, 2014, our directors, executive
officers and 5% or greater stockholders beneficially owned approximately 52.3% of our voting capital stock, after giving effect
to (i) the amendment of certain notes to be convertible into series C preferred stock that were originally convertible into common
stock, series B-1 preferred stock and series B-2 preferred stock and (ii) the amendment of certain outstanding warrants to block
any exercise if such exercise will result in the holder having beneficial ownership of more than 9.99% of our common stock (for
a description of these changes, see “Certain Relationships and Related Transactions”). When this offering is completed,
our directors, executive officers and 5% or greater stockholders will, in the aggregate, beneficially own shares representing
34.6% of our voting capital stock, assuming such persons do not purchase any shares of common stock in this offering. For a description
of the series C preferred stock, see “Description of Securities — Preferred Stock — Series C Convertible Preferred
Stock.” Each holder of series C preferred stock will be entitled to the number of votes equal to the number of whole shares
of common stock into which the shares of series C preferred stock held by such holder is then convertible (subject to a beneficial
ownership limitation, which will prevent such holder from exercising voting rights with respect to more than 9.99% of our common
stock) with respect to any and all matters presented to the stockholders for their action or consideration. Holders of series
C preferred stock will vote together with the holders of common stock as a single class, except as provided by law and except
that the consent of holders of a majority of the outstanding series C preferred stock will be required to amend the terms of the
series C preferred stock. As a result, if these stockholders were to choose to act together, they would be able to exercise significant
influence with respect to all matters submitted to our stockholders for approval, as well as our management and affairs. For example,
these persons, if they choose to act together, will exercise significant influence with respect to the election of directors and
approval of any merger, consolidation, sale of all or substantially all of our assets or other business combination or reorganization.
This concentration of voting power could delay or prevent an acquisition of us on terms that other stockholders may desire. The
interests of this group of stockholders may not always coincide with your interests or the interests of other stockholders, and
they may act in a manner that advances their best interests and not necessarily those of other stockholders, and might affect
the prevailing market price for our securities.

The price of our securities may be volatile, and the
market price of our securities after this offering may drop below the price you pay.

The initial public offering price per
unit may vary from the market prices of our units, common stock and warrants that prevail after the offering. If an active market
for our securities develops and continues, the price of such securities nevertheless may be volatile. Market prices for securities
of early-stage medical device companies have historically been particularly volatile. As a result of this volatility, you may
not be able to sell your units, shares of common stock or warrants at or above the initial public offering price paid per unit.
The factors that may cause the market price of our securities to fluctuate include, but are not limited to:

·

progress, or lack of progress, in developing and commercializing
our products;

·

favorable or unfavorable decisions about our products or intellectual
property from government regulators, insurance companies or other third-party payers;

·

our ability to recruit and retain qualified regulatory and research
and development personnel;

14

·

changes in investors’ and securities analysts’ perception
of the business risks and conditions of our business;

·

changes in our relationship with key collaborators;

·

changes in the market valuation or earnings of our competitors
or companies viewed as similar to us;

·

changes in key personnel;

·

depth of the trading market in our common stock;

·

termination of the lock-up agreement or other restrictions on
the ability of us or any of our existing stockholders to sell shares after this offering;

·

changes in our capital structure, such as future issuances of
securities or the incurrence of additional debt;

·

the granting or exercise of employee stock options or other
equity awards;

·

realization of any of the risks described under this section
entitled “Risk Factors”; and

·

general market and economic conditions.

In addition, the equity markets have
experienced significant price and volume fluctuations that have affected the market prices for the securities of newly public
companies for a number of reasons, including reasons that may be unrelated to our business or operating performance. These broad
market fluctuations may result in a material decline in the market price of our securities and you may not be able to sell your
units, common stock or warrants at prices you deem acceptable. In the past, following periods of volatility in the
equity markets, securities class action lawsuits have been instituted against public companies. Such litigation, if instituted
against us, could result in substantial cost and the diversion of management attention.

Purchasers in this offering will experience immediate
and substantial dilution in the book value of their investment.

If you purchase units in this offering,
the public offering price that you pay per share of common stock will be substantially higher than the net tangible book value
per share of our common stock immediately after this offering. Therefore, you will incur an immediate dilution of $4.26 (or 71%)
in net tangible book value per share of common stock from the price you paid, based on the public offering price of $6.00 per
unit (the midpoint of the range set forth on the cover page of this prospectus). The exercise of outstanding warrants and options
may result in further dilution of your investment. In addition, if we raise funds by issuing additional shares or convertible
securities in the future, the newly issued shares may further dilute your ownership interest.

Future sales of our common stock, or the perception that
future sales may occur, may cause the market price of our common stock to decline, even if our business is doing well.

Sales of substantial amounts of our common
stock in the public market after this offering, or the perception that these sales may occur, could materially and adversely affect
the price of our common stock and could impair our ability to raise capital through the sale of additional equity securities.
The shares of common stock sold in this offering will be freely tradable, without restriction, in the public market, except for
any shares sold to our affiliates.

15

In connection with this offering, we and
our officers and directors have agreed prior to the commencement of this offering, subject to limited exceptions, not to sell
or transfer any shares of common stock for 180 days after the date of this prospectus without the consent of Chardan Capital Markets
LLC, as representative of the underwriters. However, Chardan Capital Markets LLC may release these shares from any restrictions
at any time. We cannot predict what effect, if any, market sales of shares held by any stockholder or the availability of shares
for future sale will have on the market price of our common stock.

Approximately 1,240,000 shares of common
stock may be sold in the public market by existing stockholders after the date of this prospectus and an additional 977,564 shares
of common stock may be sold in the public market by existing stockholders on or about 181 days after the date of this prospectus,
subject to volume and other limitations imposed under the federal securities laws. Sales of substantial amounts of our common
stock in the public market after the completion of this offering, or the perception that such sales could occur, could adversely
affect the market price of our common stock and could materially impair our ability to raise capital through offerings of our
common stock. See the section entitled “Shares Eligible for Future Sale” for a more detailed description of the restrictions
on selling shares of our common stock after this offering.

We are issuing warrants to purchase
1,333,333 shares of common stock in this offering (1,533,333 if the overallotment option is exercised in full). We will also
issue warrants to the underwriters in this offering to purchase an additional 66,667 units (76,667 if the overallotment option
is exercised in full), which will include warrants to purchase 66,667 shares of common stock (76,667 if the overallotment option
is exercised in full). In addition, as of April 28, 2014, we had outstanding options to purchase 360,815 shares of our common
stock and outstanding warrants to purchase an aggregate of 632,047 shares of our common stock. We plan to register for offer and
sale the shares of common stock that are reserved for issuance pursuant to outstanding options. Shares covered by such registration
statements upon the exercise of stock options generally will be eligible for sale in the public market, except that affiliates
will continue to be subject to volume limitations and other requirements of Rule 144 under the Securities Act of 1933, as amended.
The issuance or sale of such shares could depress the market price of our common stock.

An active trading market may not develop for our securities,
and you may not be able to sell your units, common stock or warrants at or above the initial public offering price or warrant
exercise price per share.

There is no established trading market
for our securities, and the market for our securities may be highly volatile or may decline regardless of our operating performance.
Prior to this offering, you could not buy or sell our securities publicly. An active public market for our securities may not
develop or be sustained after this offering. We cannot predict the extent to which investor interest in our company will lead
to the development of an active trading market in our units, common stock or warrants or how liquid that market might become.
If a market does not develop or is not sustained, it may be difficult for you to sell your securities at the time you wish to
sell them, at a price that is attractive to you, or at all.

The initial public offering price per
unit has been determined through negotiation between us and the representative of the underwriters, and may not be indicative
of the market prices that prevail after this offering. You may not be able to sell your units, common stock or warrants at or
above the initial public offering price or warrant exercise price per share.

Due to the speculative nature of warrants, there is
no guarantee that it will ever be profitable for holders of the warrants to exercise the warrants.

The warrants being offered as part of the units do not confer any rights of common stock ownership
on their holders, such as voting rights or the right to receive dividends, but rather merely represent the right to acquire shares
of common stock at a fixed price for a limited period of time. Specifically, commencing 45 days after the date of this prospectus,
holders of the warrants may exercise their right to acquire the common stock and pay an exercise price of $ per
share (which is equal to 125% of the public offering price of the units), prior to the expiration of the five-year term on
, 2019, after which date any unexercised warrants will expire and have no further value. Moreover, following this offering, the
market value of the warrants is uncertain and there can be no assurance that the market value of the warrants will equal or exceed
their public offering price. There can be no assurance that the market price of the common stock will ever equal or exceed the
exercise price of the warrants, and, consequently, whether it will ever be profitable for holders of the warrants to exercise
the warrants.

Holders may be unable to exercise the warrants if
we do not maintain a current prospectus and comply with applicable securities laws.

No warrants will be exercisable unless
at the time of exercise a prospectus relating to the common stock issuable upon exercise of the warrants is current and the common
stock has been registered or qualified or is deemed to be exempt under the securities laws of the state of residence of the holder
of the warrants. Under the terms of the warrant agreement, we have agreed to meet these conditions and use our best efforts to
maintain a current prospectus relating to the common stock issuable upon exercise of the warrants until the expiration of the
warrants. However, we cannot assure you that we will be able to do so, and if we do not maintain a current prospectus related
to the common stock issuable upon exercise of the warrants, holders will be unable to exercise their warrants and we will not
be required to settle any such warrant exercise. If the prospectus relating to the common stock issuable upon the exercise of
the warrants is not current or if the common stock is not qualified or exempt from qualification in the jurisdictions in which
the holders of the warrants reside, we will not be required to net cash settle or cash settle the warrant exercise, the warrants
may have no value, the market for the warrants may be limited and the warrants may expire worthless.

We, together with holders of 65% of the warrants,
may amend the terms of the warrants prior to their expiration.

The exercise price, expiration date
and all other warrant terms may be changed without the consent of investors if we, together with holders of 65% of the warrants,
consent to such change. There can be no assurance that any such change would not materially adversely impact the rights of warrant
holders or the value of the warrants.

We will incur significant increased costs as a result
of operating as a public company, and our management will be required to devote substantial time to new compliance initiatives.

As a public company, we will incur significant
legal, accounting and other expenses that we did not incur as a private company. The Sarbanes-Oxley Act of 2002, as well as rules
subsequently implemented by the Securities and Exchange Commission and The Nasdaq Stock Market, have imposed various requirements
on public companies, including requiring establishment and maintenance of effective disclosure and financial controls and changes
in corporate governance practices. Our management and other personnel will need to devote a substantial amount of time to these
new compliance initiatives. Moreover, these rules and regulations will increase our legal and financial compliance costs and will
make some activities more time consuming and costly. We expect these rules and regulations to make it more difficult and more
expensive for us to obtain director and officer liability insurance and we may be required to incur substantial costs to maintain
the same or similar coverage.

16

We are obligated to develop and maintain proper and effective
internal controls over financial reporting. We may not complete our analysis of our internal controls over financial reporting
in a timely manner, or these internal controls may have one or more material weaknesses, which may adversely affect investor confidence
in our company and, as a result, the value of our common stock.

Ensuring that we have adequate internal
financial and accounting controls and procedures in place so that we can produce accurate financial statements on a timely basis
is a costly and time-consuming effort that will need to be evaluated frequently. Section 404 of the Sarbanes-Oxley Act requires
public companies to conduct an annual review and evaluation of their internal controls and attestations of the effectiveness of
internal controls by independent auditors. We would be required to perform the annual review and evaluation of our internal controls
no later than in connection with the second annual report on Form 10-K filed after the offering to which this prospectus relates.
However, we initially expect to qualify as a smaller reporting company and as an emerging growth company, and thus, we would be
exempt from the auditors’ attestation requirement until such time as we no longer qualify as a smaller reporting company
and an emerging growth company. We would no longer qualify as a smaller reporting company if the market value of our public float
exceeded $75 million as of the last day of our second fiscal quarter in any fiscal year following this offering. We would no longer
qualify as an emerging growth company at such time as described in the risk factor immediately below.

We are in the early stages of the costly
and challenging process of compiling the system and processing documentation necessary to evaluate and correct a material weakness
in internal controls needed to comply with Section 404. The material weakness relates to our being a small company with a limited
number of employees which limits our ability to assert the controls related to the segregation of duties. During the evaluation
and testing process, if we identify one or more additional material weaknesses in our internal control over financial reporting,
we will be unable to assert that our internal controls are effective. If we are unable to assert that our internal control over
financial reporting is effective, we could lose investor confidence in the accuracy and completeness of our financial reports,
which would cause the price of our common stock to decline.

While we currently qualify as an “emerging growth
company” under the Jumpstart of Business Startups Act of 2012, or the JOBS Act, we will lose that status at the latest by
the end of 2019, which will increase the costs and demands placed upon our management.

We will continue to be deemed an emerging
growth company until the earliest of (i) the last day of the fiscal year during which we had total annual gross revenues of $1
billion (as indexed for inflation); (ii) the last day of the fiscal year following the fifth anniversary of the date of the first
sale of common stock under this registration statement; (iii) the date on which we have, during the previous 3-year period, issued
more than $1 billion in non-convertible debt; or (iv) the date on which we are deemed to be a ‘large accelerated filer,’
as defined by the Securities and Exchange Commission, which would generally occur upon our attaining a public float of at least
$700 million. Once we lose emerging growth company status, we expect the costs and demands placed upon our management to increase,
as we would have to comply with additional disclosure and accounting requirements, particularly if we would also no longer qualify
as a smaller reporting company.

We are an “emerging growth company” and we
cannot be certain that the reduced disclosure requirements applicable to emerging growth companies will make our common stock
less attractive to investors.

The JOBS Act permits “emerging growth
companies” like us to rely on some of the reduced disclosure requirements that are already available to smaller reporting
companies. As long as we qualify as an emerging growth company or a smaller reporting company, we would be permitted to omit the
auditor’s attestation on internal control over financial reporting that would otherwise be required by the Sarbanes-Oxley
Act, as described above and are also exempt from the requirement to submit “say-on-pay”, “say-on-pay frequency”
and “say-on-parachute” votes to our stockholders and may avail ourselves of reduced executive compensation disclosure
that is already available to smaller reporting companies.

In addition, Section 107 of the JOBS Act
also provides that an emerging growth company can take advantage of the exemption from complying with new or revised accounting
standards provided in Section 7(a)(2)(B) of the Securities Act of 1933, as amended, as long as we are an emerging growth company.
An emerging growth company can therefore delay the adoption of certain accounting standards until those standards would otherwise
apply to private companies. We have elected to take advantage of the benefits of this until we are no longer an emerging growth
company or until we affirmatively and irrevocably opt out of this exemption. Our financial statements may therefore not be comparable
to those of companies that comply with such new or revised accounting standards.

17

We will cease to be an emerging growth
company at such time as described in the risk factor immediately above. Until such time, however, we cannot predict if investors
will find our common stock less attractive because we may rely on these exemptions. If some investors find our common stock less
attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile
and could cause our stock price to decline.

Our management will have broad discretion over the use
of the proceeds we receive in this offering, and may not apply the proceeds in ways that increase the value of your investment.

We estimate that net proceeds of the sale
of the units that we are offering will be approximately $6.38 million, or $7.47 million if the underwriters exercise their
option to purchase additional units in this offering in full, based on an assumed initial public offering price of $6.00 per unit,
the midpoint of the price range set forth on the cover page of this prospectus. We currently intend to use the net proceeds of
the offering for marketing activities, clinical and regulatory activities, research and development and intellectual property
protection. Depending on the outcome of these activities, our plans and priorities may change and we may apply the net proceeds
of this offering differently than we currently anticipate. Moreover, you will not have the opportunity to influence our decision
on how to use the proceeds from this offering. We may use the proceeds for corporate purposes that do not immediately enhance
our prospects for the future or increase the value of your investment. See “Use of Proceeds.”

Anti-takeover provisions of our certificate of incorporation,
our bylaws and Delaware law could make an acquisition of us, which may be beneficial to our stockholders, more difficult and may
prevent attempts by our stockholders to replace or remove the current members of our board and management.

Certain provisions of our amended and restated
certificate of incorporation and bylaws that will be in effect upon the completion of this offering could discourage, delay or
prevent a merger, acquisition or other change of control that stockholders may consider favorable, including transactions in which
you might otherwise receive a premium for your shares. Furthermore, these provisions could prevent or frustrate attempts by our
stockholders to replace or remove members of our board of directors. These provisions also could limit the price that investors
might be willing to pay in the future for our securities, thereby depressing the market price of our securities. Stockholders
who wish to participate in these transactions may not have the opportunity to do so. These provisions, among other things:

·

allow the authorized number of directors to be changed only
by resolution of our board of directors;

·

authorize our board of directors to issue, without stockholder
approval, preferred stock, the rights of which will be determined at the discretion of the board of directors and that, if
issued, could operate as a “poison pill” to dilute the stock ownership of a potential hostile acquirer to prevent
an acquisition that our board of directors does not approve;

·

establish advance notice requirements for stockholder nominations
to our board of directors or for stockholder proposals that can be acted on at stockholder meetings; and

·

limit who may call a stockholder meeting.

In addition, we are governed by the provisions
of Section 203 of the Delaware General Corporation Law that may, unless certain criteria are met, prohibit large stockholders,
in particular those owning 15% or more of the voting rights on our common stock, from merging or combining with us for a prescribed
period of time.

18

If securities or industry analysts do not publish research
or reports or publish unfavorable research about our business, the price of our securities and their trading volume could decline.

The trading market for our securities will
depend in part on the research and reports that securities or industry analysts publish about us or our business. We do not currently
have and may never obtain research coverage by securities and industry analysts. If no securities or industry analysts commence
coverage of us the trading price for our securities would be negatively affected. In the event we obtain securities or industry
analyst coverage, if one or more of the analysts who covers us downgrades our securities, the price of our securities would likely
decline. If one or more of these analysts ceases to cover us or fails to publish regular reports on us, interest in the purchase
of our securities could decrease, which could cause the price of our securities and their trading volume to decline.

We may be subject to ongoing restrictions related to
grants from the Israeli Office of the Chief Scientist.

Through our Israeli subsidiary, we received
grants of $436,815 from the Office of the Chief Scientist of the Israeli Ministry of Industry, Trade and Labor, or the Office
of the Chief Scientist, for research and development programs related to products that we are not currently commercializing or
marketing. Because we are no longer developing the product to which the grants relate, we do not believe that we are subject to
any material conditions with respect to the grants, except for the restrictions on our ability to make certain transfers of the
technology or intellectual property related to these grants described below. We could in the future determine to apply for further
grants. If we receive any such grants, we would have to comply with specified conditions, including paying royalties with respect
to grants received. If we fail to comply with these conditions in the future, sanctions might be imposed on us, such as grants
could be cancelled and we could be required to refund any payments previously received under these programs.

Pursuant to the Israeli Encouragement of
Industrial Research and Development Law, any products developed with grants from the Office of the Chief Scientist are required
to be manufactured in Israel and certain payments may be required in connection with the change of control of the grant recipient
and the financing, mortgaging, production, exportation, licensing and transfer or sale of its technology and intellectual property
to third parties, which will require the Office of the Chief Scientist’s prior consent and, in case such a third party is
outside of Israel, extended royalties and/or other fees. This could have a material adverse effect on and significant cash flow
consequences to us if, and when, any technologies, intellectual property or manufacturing rights are exported, transferred or
licensed to third parties outside Israel. If the Office of the Chief Scientist does not wish to give its consent in any required
situation or transaction, we would need to negotiate a resolution with the Office of the Chief Scientist. In any event, such a
transaction, assuming it was approved by the Office of the Chief Scientist, would involve monetary payments, such as royalties
or fees, of not less than the applicable funding received from the Office of the Chief Scientist plus interest, not to exceed,
in aggregate, six times the applicable funding received from the Office of the Chief Scientist.

Because we do not expect to pay cash dividends for the
foreseeable future, you must rely on appreciation of our common stock price for any return on your investment. Even if we change
that policy, we may be restricted from paying dividends on our common stock.

We do not intend to pay cash dividends
on shares of our common stock for the foreseeable future. Any determination to pay dividends in the future will be at the discretion
of our board of directors and will depend upon results of operations, financial performance, contractual restrictions, restrictions
imposed by applicable law and other factors our board of directors deems relevant. Accordingly, you will have to rely on capital
appreciation, if any, to earn a return on your investment in our common stock. Investors seeking cash dividends in the foreseeable
future should not purchase our common stock.

Our ability to use our net operating loss carry forwards
and certain other tax attributes may be limited.

Our ability to utilize our federal net
operating loss, carryforwards and federal tax credit may be limited under Sections 382 and 383 of the Internal Revenue Code of
1986, as amended. The limitations apply if an “ownership change,” as defined by Section 382, occurs. Generally, an
ownership change occurs if the percentage of the value of the stock that is owned by one or more direct or indirect “five
percent shareholders” increases by more than 50% over their lowest ownership percentage at any time during the applicable
testing period (typically three years). If we have experienced an “ownership change” at any time since our formation,
we may already be subject to limitations on our ability to utilize our existing net operating losses and other tax attributes
to offset taxable income. In addition, future changes in our stock ownership, which may be outside of our control, may trigger
an “ownership change” and, consequently, Section 382 and 383 limitations. As a result, if we earn net taxable income,
our ability to use our pre-change net operating loss carryforwards and other tax attributes to offset U.S. federal taxable income
may be subject to limitations, which could potentially result in increased future tax liability to us.

19

Risks Related to our Operations in
Israel

We conduct our operations in Israel and therefore our
results may be adversely affected by political, economic and military instability in Israel and its region.

Our principal offices are located in Israel
and most of our officers, employees and directors are residents of Israel. Accordingly, political, economic and military conditions
in Israel and the surrounding region may directly affect our business. Since the establishment of the State of Israel in 1948,
a number of armed conflicts have taken place between Israel and its Arab neighbors. Any hostilities involving Israel or the interruption
or curtailment of trade within Israel or between Israel and its trading partners could adversely affect our operations and results
of operations and could make it more difficult for us to raise capital. During the winter of 2012, Israel was engaged in an armed
conflict with Hamas, a militia group and political party operating in the Gaza Strip. This conflict involved missile strikes against
civilian targets in various parts of Israel and negatively affected business conditions in Israel. Recent political uprisings
and civil resistance demonstrations in various countries in the Middle East, including Egypt and Syria, are affecting the political
stability of those countries. It is not clear how this instability, or the Arab Spring in general, will develop and how it will
affect the political and security situation in the Middle East. This instability may lead to deterioration of the political relationships
that exist between Israel and these countries, and have raised concerns regarding security in the region and the potential for
armed conflict. In addition, it is widely believed that Iran, which has previously threatened to attack Israel, has been stepping
up its efforts to achieve nuclear capability. Iran is also believed to have a strong influence among extremist groups in the region,
such as Hamas in Gaza and Hezbollah in Lebanon. The tension between Israel and Iran and/or these groups may escalate in the future
and turn violent, which could affect the Israeli economy generally and us in particular. Any armed conflicts, terrorist activities
or political instability in the region could adversely affect business conditions and could harm our results of operations. For
example, any major escalation in hostilities in the region could result in a portion of our employees being called up to perform
military duty for an extended period of time. Parties with whom we do business have sometimes declined to travel to Israel during
periods of heightened unrest or tension, forcing us to make alternative arrangements when necessary.

Our commercial insurance does not cover
losses that may occur as a result of events associated with the security situation in the Middle East. Although the Israeli government
currently covers the reinstatement value of direct damages that are caused by terrorist attacks or acts of war, we cannot assure
you that this government coverage will be maintained. Any losses or damages incurred by us could have a material adverse effect
on our business. Any armed conflicts or political instability in the region would likely negatively affect business conditions
and could harm our results of operations.

Further, in the past, the State of Israel
and Israeli companies have been subjected to an economic boycott. Several countries still restrict business and trade activity
with the State of Israel and with Israeli companies. These restrictive laws and policies may have an adverse impact on our operating
results, financial condition or the expansion of our business.

Our operations may be disrupted as a result of the obligation
of management or personnel to perform military service.

Many of our male employees in Israel, including
members of our senior management, perform up to one month, and in some cases more, of annual military reserve duty until they
reach the age of 45 or older and, in the event of a military conflict, may be called to active duty. There have also been periods
of significant call-ups of military reservists, and it is possible that there will be military reserve duty call-ups in the future.
Our operations could be disrupted by the absence of a significant number of our employees. Such disruption could materially adversely
affect our business, financial condition and results of operations.

20

Because a certain portion of our expenses is incurred
in currencies other than the U.S. dollar, our results of operations may be harmed by currency fluctuations and inflation.

Our reporting and functional currency is
the U.S. dollar. Most of the royalty payments from our agreements with our development and/or commercialization partners are payable
in U.S. dollars, and we expect our revenues from future licensing agreements to be denominated mainly in U.S. dollars or in Euros.
We pay a substantial portion of our expenses in U.S. dollars; however, a portion of our expenses, related to salaries of the employees
in Israel and payment to part of the service providers in Israel and other territories, are paid in New Israeli Shekels, or NIS,
and in other currencies. In addition, a portion of our financial assets is held in NIS and in other currencies. As a result, we
are exposed to the currency fluctuation risks. For example, if the NIS strengthens against the U.S. dollar, our reported expenses
in U.S. dollars may be higher than anticipated. In addition, if the NIS weakens against the U.S. dollar, the U.S. dollar value
of our financial assets held in NIS will decline.

It may be difficult for investors in the U.S. to enforce
any judgments obtained against us or any of our directors or officers.

Almost all of our assets are located outside
the U.S., although we do maintain a permanent place of business within the U.S. In addition, all of our officers and some of our
directors are nationals and/or residents of countries other than the U.S., and all or a substantial portion of such persons’
assets are located outside the U.S. As a result, it may be difficult for investors to enforce within the U.S. any judgments obtained
against us or any of our non-U.S. directors or officers, including judgments predicated upon the civil liability provisions of
the securities laws of the U.S. or any state thereof. Additionally, it may be difficult to assert U.S. securities law claims in
actions originally instituted outside of the U.S. Israeli courts may refuse to hear a U.S. securities law claim because Israeli
courts may not be the most appropriate forums in which to bring such a claim. Even if an Israeli court agrees to hear a claim,
it may determine that the Israeli law, and not U.S. law, is applicable to the claim. Further, if U.S. law is found to be applicable,
certain content of applicable U.S. law must be proved as a fact, which can be a time-consuming and costly process, and certain
matters of procedure would still be governed by the Israeli law. Consequently, you may be effectively prevented from pursuing
remedies under U.S. federal and state securities laws against us or any of our non-U.S. directors or officers.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING
STATEMENTS

This prospectus contains “forward-looking
statements,” which include information relating to future events, future financial performance, financial projections, 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, 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 be achieved. Forward-looking statements are based on information we have when those statements are
made or 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:

·

The timing of clinical studies and eventual U.S. Food and Drug Administration approval of
WoundShield and our other product candidates.

·

Regulatory actions that could adversely affect the price of or demand for our approved products.

·

Market acceptance of existing and new products.

·

Favorable or unfavorable decisions about our products from government
regulators, insurance companies or other third-party payers.

·

Our intellectual property portfolio.

·

We are not currently meeting the minimum sales requirements necessary to prevent our license
agreement related to NanoVibronix NPWT from terminating in August 2014, and even if we meet such sales requirements, the license
will no longer be exclusive after such date.

21

·

Our ability to recruit and retain qualified regulatory and research and development personnel.

·

Unforeseen changes in healthcare reimbursement for any of our
approved products.

Changes in the market valuation or earnings of our competitors
or companies viewed as similar to us.

·

Our failure to comply with regulatory guidelines.

·

Uncertainty in industry demand and patient wellness behavior.

·

General economic conditions and market conditions in the medical device industry.

·

Future sales of large blocks of our common stock, which may adversely impact our stock price.

·

Depth of the trading market in our common stock.

·

Termination of the lock-up agreement or other restrictions on
the ability of us or any of our existing stockholders to sell shares after this offering;

The foregoing does not represent an exhaustive
list of matters that may be covered by the forward-looking statements contained herein or risk factors that we are faced with
that may cause our actual results to differ from those anticipated in our forward-looking statements. Please see “Risk Factors”
for additional risks which could adversely impact our business and financial performance. Moreover, new risks regularly emerge
and it is not possible for us to predict or articulate all risks we face, nor can we assess the impact of all risks on our business
or the extent to which any risk, or combination of risks, may cause actual results to differ from those contained in any forward-looking
statements. All forward-looking statements included in this prospectus are based on information available to us on the date of
this prospectus. Except to the extent required by applicable laws or rules, we undertake no obligation to publicly update or revise
any forward-looking statement, whether as a result of new information, future events or otherwise. All subsequent written and
oral forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by
the cautionary statements contained above and throughout this prospectus.

22

USE OF PROCEEDS

We estimate that the net proceeds from
the sale of the units we are offering will be approximately $6.38 million. If the underwriters fully exercise the over-allotment
option, the net proceeds of the securities we sell will be approximately $7.47 million. “Net proceeds” is what we
expect to receive after paying the underwriting discount and other expenses of the offering. For the purpose of estimating net
proceeds, we are assuming that the public offering price will be $6.00 per unit, the midpoint of the price range set forth
on the cover page of this prospectus.

We intend to use the net proceeds as follows:

·

We
expect to use approximately $60,000 for bonus compensation due to Messrs. Shahaf and
Ashkenazy under their employment agreements (see “Executive Compensation –
Agreement With Ophir Shahaf” and “Executive Compensation – Agreement
With Shay Ashkenazy)”

·

We expect to use approximately $3,000,000 for marketing and sales activities, which may include
investment in branding our products, producing marketing materials, targeting certain publications, attending exhibitions
and medical shows and visiting customers and potential customers.

We expect to use approximately $500,000 for research and development, including the integration
of WoundShield and NanoVibronix NPWT and other product innovations, improvements and integration.

·

We expect to use approximately $120,000 for intellectual property protection, to support
filed patent applications and obtain additional intellectual property protection if needed.

·

We expect to use the balance of the net proceeds for operations and general working capital requirements,
which could include officer salaries.

We will also receive proceeds upon any
cash exercise of the warrants sold in this offering. If all of these warrants were to be exercised at an exercise price of $7.50
per share, which is 125% of the midpoint of the price range set forth on the cover page of this prospectus, then we would receive
net proceeds of approximately $10.0 million, or approximately $11.5 million if the underwriters fully exercise the over-allotment
option. We expect to use these proceeds, if any, for operations and general working capital requirements at the time of such exercise.

Investors are cautioned, however, that
expenditures may vary substantially from these estimates. 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 our potential investments in new businesses, 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:

·

the timing of clinical studies and eventual U.S. Food and Drug Administration approval of
WoundShield and our other product candidates;

·

the need or desire on our part to accelerate, increase or eliminate existing initiatives
due to, among other things, changing market conditions and competitive developments; and

·

the availability of other sources of cash including cash flow from operations and new bank
debt financing arrangements, if any.

Until we use the net proceeds of this offering,
we will invest the funds in short-term, investment grade, interest-bearing securities.

A $1.00 increase or decrease in the assumed
initial public offering price of $6.00 per unit (the midpoint of the price range set forth on the front cover of this prospectus)
would increase or decrease the net proceeds to us from this offering by approximately $1.21 million, assuming the number of shares
offered by us remains the same and after deducting estimated underwriting discounts and commission and estimated offering expenses
payable by us. Similarly, any increase or decrease in the number of units that we sell in the offering will increase or decrease
our net proceeds in proportion to such increase or decrease, as applicable, multiplied by the offering price per unit, less underwriting
discounts and commission and estimated offering expenses payable by us. The information discussed above is illustrative only and
will adjust based on the actual public offering price and other terms of this offering determined at pricing.

23

CAPITALIZATION

The following table summarizes our capitalization
as of December 31, 2013:

·

on an actual basis;

·

on a pro forma basis, giving effect to

o

the conversion of all outstanding shares of our convertible preferred
stock (other than our series C preferred
stock) into an aggregate of 396,444 shares of common stock; we have obtained the necessary
consents to effect the conversion of all of our outstanding preferred stock automatically
upon the effectiveness of this registration statement;

o

the conversion of all outstanding convertible indebtedness, including accrued interest thereon,
into an aggregate of 1,608,969 shares of common stock and
736,333 shares of series C preferred stock, and assuming an April 28, 2014 conversion date; we have obtained the necessary
consents to effect the conversion of all of our outstanding convertible debt automatically upon the effectiveness of this
registration statement, regardless of the proceeds to be received in the offering; and

o

the filing of our amended and restated
certificate of incorporation and the effectiveness of our restated bylaws, which will occur immediately prior to the completion
of this offering.

·

on a pro forma, as adjusted basis, giving effect to (1) all of the above, (2) our receipt of
the net proceeds from the sale by us in this offering of units at an assumed public offering price of $6.00 per unit,
the midpoint of the range set forth on the cover page of this prospectus, after deducting estimated underwriting discounts
and commissions and estimated offering expenses payable by us and (3) the application of the net proceeds we will receive
from this offering in the manner described in “Use of Proceeds.”

The pro forma information below is illustrative
only and our capitalization following the completion of this offering will be adjusted based on the actual initial public offering
price and other terms of this offering determined at pricing. You should read this table together with “Management’s
Discussion and Analysis of Financial Condition and Results of Operations” and our audited and unaudited consolidated financial
statements and the related notes appearing elsewhere in this prospectus.

3,550,897
shares issued and outstanding
pro forma as adjusted includes 1,333,333 shares of common stock included in the
units being sold in this offering and does not include 1,333,333 shares of common
stock issuable upon the full exercise of the warrants included in the units sold in this
offering, 66,667 shares of common stock included in the units issuable upon the
full exercise of the underwriters’ warrants and 66,667 shares issuable upon
the full exercise of the warrants included in the units issuable upon the full exercise
of the underwriters’ warrants.

24

DILUTION

The difference between the public offering
price per share, assuming no value is attributed to the warrants included in the units we are offering by this prospectus, and
the pro forma net tangible book value per share after this offering constitutes the dilution to investors in this offering. Such
calculation does not reflect any dilution associated with the sale and exercise of the warrants. Our net tangible book value on
December 31, 2013 was approximately $(3,297,000), or $(21.27) per share. “Net tangible book value” is total assets
minus the sum of liabilities and intangible assets. “Net tangible book value per share” is net tangible book value
divided by the total number of shares outstanding.

After giving effect to adjustments relating
to the offering, our pro forma as adjusted net tangible book value on December 31, 2013, would have been $6,190,000, or $1.74
per share. The adjustments made to determine pro forma net tangible book value per share are the following:

·

The pro forma adjustments referenced under “Capitalization.”

·

An increase in total assets to reflect the net proceeds of the offering as described under “Use of Proceeds”
(assuming that the public offering price will be $6.00 per unit, the midpoint of the range set forth on the cover page
of this prospectus).

·

The addition of the number of shares offered by this prospectus to the number of shares
outstanding.

The following table illustrates the pro
forma increase in net tangible book value of $21.18 per share and the dilution (the difference between the offering price per
share and net tangible book value per share) to new investors:

Assumed
public offering price per share of common stock

$

6.00

Net tangible book
value per share as of December 31, 2013

$

(21.27

)

Pro forma net
tangible book value per share of December 31, 2013

$

(0.09)

Increase in pro
forma net tangible book value per share attributable to the offering

$

21.18

Pro forma as adjusted
net tangible book value per share as of December 31, 2013 after giving effect to the offering

$

1.74

Dilution in pro
forma net tangible book value per share to new investors in the offering

$

4.26

The following table shows, on a pro forma
basis as described above, the difference between existing stockholders and new investors with respect to the number of shares
of common stock purchased from us, the total consideration paid and the average price paid per share. The table assumes that the
public offering price will be $6.00 per unit, the midpoint of the range set forth on the cover page of this prospectus.

Shares Purchased

Total Consideration

Average Price

Number

Percent

Amount

Percent

Per Share

Existing stockholders

2,217,564

62

%

$

9,490,973

54

%

$

4.28

New investors

1,333,333

38

%

$

8,000,000

46

%

$

6.00

Total

3,550,897

100

%

$

17,490,973

100

%

The foregoing tables and calculations are
based on the number of shares of our common stock outstanding as of December 31, 2013 and exclude:

·

225,564 shares of common stock issuable upon the exercise of warrants with an exercise price
of $2.66 per share;

·

331,295 shares of common stock issuable upon the exercise of warrants with an exercise price
of $1.393 per share;

·

360,101 shares of common stock issuable upon the exercise of currently outstanding options with
a weighted average exercise price of $5.34; and

·

39,899 shares of common stock available for future issuance under our 2004 Global Share Option
Plan.

25

To the extent any of these outstanding
options or warrants is exercised, the dilution to new investors would be reduced. To the extent all of such outstanding options
and warrants had been exercised as of December 31, 2013, the pro forma as adjusted net tangible book value per share after this
offering would be $2.06, and total dilution per share to new investors would be $3.94.

Each $1.00 increase (decrease) in the assumed
initial public offering price of $6.00 per unit, the midpoint of the range set forth on the cover page of this prospectus, would
increase (decrease) our pro forma as adjusted net tangible book value by approximately $1,213,333, the pro forma as adjusted net
tangible book value per share by approximately $0.34 per share and the dilution to investors in this offering by approximately
$0.34 per share, assuming the number of units offered by us, as set forth on the cover page of this prospectus, remains the
same and after deducting the underwriting discounts and commissions and estimated offering expenses payable by us.

The information above assumes that the
underwriters do not exercise their over-allotment option. If the underwriters exercise their over-allotment option in full, the
pro forma as adjusted net tangible book value will increase to $1.99 per share, representing an immediate dilution of $4.01 per
share to new investors.

DIVIDEND POLICY

In the past, we have not declared
or paid cash dividends on our common stock, and we do not intend to pay any cash dividends on our common stock. Rather, we intend
to retain future earnings (if any) to fund the operation and expansion of our business and for general corporate purposes. Subject
to legal and contractual limits, our board of directors will make any decision as to whether to pay dividends in the future.

MANAGEMENT’S DISCUSSION AND ANALYSIS
OF FINANCIALCONDITION AND RESULTS OF OPERATIONS

You should read
the following discussion and analysis of financial condition and results of operations in conjunction with our consolidated financial
statements and the related notes thereto included elsewhere in this prospectus. In addition to historical information, the following
discussion and analysis includes forward-looking information that involves risks, uncertainties and assumptions. Our actual results
and the timing of events could differ materially from those anticipated by these forward-looking statements as a result of many
factors, including those discussed under “Risk Factors” and elsewhere in this prospectus. See “Cautionary Note
Regarding Forward-Looking Statements” included elsewhere in this prospectus.

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 WoundShield, PainShield and UroShield products are backed by novel
technology which relates to ultrasound delivery through surface acoustic waves. Our NanoVibronix NPWT employs a technology that
drains open cavity wounds and seeks to accelerate wound healing.

Recent Events

On February 5, 2013,
we issued secured convertible promissory notes to certain investors. The convertible promissory notes were initially issued in
the original aggregate principal amount of $100,000. On each of March 28, 2013, June 3, 2013, August 5, 2013, October 7, 2013,
December 9, 2013, February 6, 2014 and April 1, 2014, such principal amount was increased by $100,000, so that the total current
principal amount outstanding is $800,000. The convertible promissory notes mature on the earlier of June 30, 2014, the closing
date of a financing in which we sell an aggregate of at least $250,000 of our debt or equity securities or on an accelerated date
if there is an event of default, upon which date the entire outstanding principal balance and any outstanding fees or interest
will be due and payable in full. The convertible promissory notes bear interest at the rate of 6% per annum, which rate is increased
to 10% upon and during the occurrence of an event of default. In addition, the convertible promissory notes are convertible either
at the holders’ option or upon maturity into shares of our series C preferred stock at a current conversion price of $2.66
per share, subject to adjustment for stock splits, fundamental transactions or similar events. The holders of the convertible
promissory notes have a security interest in all of our assets and those of our subsidiaries. To date, no principal or interest
has been paid on these notes. See “Liquidity and Capital Resources—Twelve Months Ended December 31, 2013 Compared
to Twelve Months Ended December 31, 2012—Convertible Promissory Notes” below for more information on the terms of
these notes.

26

In connection with
the issuance of the convertible promissory notes described above, on each of February 5, 2013, March 28, 2013, June 3, 2013 August
5, 2013, October 7, 2013, December 9, 2013, February 6, 2014 and April 1, 2014, we issued warrants to purchase 37,594 shares of
common stock (in aggregate warrants to purchase 300,752 shares), with an exercise price of $2.66 per share (subject to adjustment),
to the participating investors. See “Description of Securities—Warrants—February 2013 Warrants” below
for more information on the terms of these warrants.

Critical Accounting Policies

Use of estimates

The preparation of
consolidated financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions
that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

As applicable to these
consolidated financial statements, the most significant estimates and assumptions relate to estimation of fair value of stock
based compensation and the estimation of the fair value of warrants.

Functional currency

The accompanying consolidated
financial statements have been prepared in U.S. dollars.

We believe that the
currency of the primary economic environment in which our operations are conducted is the U.S. dollar; thus the dollar is our
functional currency. The majority of the proceeds from our financing activities are received in U.S. dollars. Although a portion
of our subsidiary’s expenses are dominated in NIS (mostly salary and rent), a substantial portion of our expenses are denominated
in U.S. dollars. In addition, most of our assets and liabilities are in U.S. dollars and we expect that most of our revenues will
be generated in U.S. dollars.

Transactions and balances
originally denominated in U.S. dollars are presented at their original amounts. Transactions and balances in other currencies
have been remeasured into U.S. dollars in accordance with Financial Accounting Standards Board Accounting Standards Codification
(“ASC”) 830, “Foreign Currency Matters.”

All transaction gains
and losses from the remeasurement of monetary balance sheet items denominated in non- U.S. dollar currencies are reflected in
the consolidated statement of comprehensive loss in financial expenses, net, as appropriate.

Revenue recognition

We generate revenues
from the sale of our products to end users. Revenues from those products are recognized in accordance with Staff Accounting Bulletin
No. 104, “Revenue Recognition,” when delivery has occurred, persuasive evidence of an agreement exists, the vendor’s
fee is fixed or determinable, no further obligation exists and collectability is probable.

The Company’s
agreements with its distributors do not contain any price protection guarantees, rights of return or other post-shipment obligations.

Stock-based
compensation

We account for stock-based
compensation in accordance with ASC 718, “Compensation-Stock Compensation” (“ASC 718”). ASC 718 requires
companies to estimate the fair value of equity-based payment awards on the date of grant using an option-pricing model. The value
of the portion of the award that is ultimately expected to vest is recognized as an expense over the requisite service period
in our consolidated statement of comprehensive loss.

We recognize compensation
expense for the value of our awards granted based on the straight line method over the requisite service period of each of the
awards, net of estimated forfeitures. ASC 718 requires forfeitures to be estimated at the time of grant and revised, if necessary,
in subsequent periods if actual forfeitures differ from those estimates. The term “forfeitures” is distinct from “cancellations”
or “expirations” and represents only the invested portion of the surrendered option. Ultimately, the actual expenses
recognized over the vesting period will only be for those shares that vest.

27

We selected the Black-Scholes-Merton
option pricing model as the most appropriate fair value method for our stock option awards. This option-pricing model requires
a number of assumptions, of which the most significant are the expected stock price volatility and the expected option term. Expected
volatility was calculated based upon similar traded companies’ historical share price movements. The expected option term
represents the period that our stock options are expected to be outstanding. We currently use a simplified method to estimate
the period that our stock options are expected to be outstanding, based on the terms of the awards. We will continue to use this
method until sufficient historical exercise data supports using expected life assumptions. The risk-free interest rate is based
on the yield from U.S. Treasury zero-coupon bonds with an equivalent term. We use an expected dividend rate of zero, as we have
historically not paid dividends and have no foreseeable plans to pay dividends.

Because there has
been no public market for our common stock, we have determined the fair value of the common stock underlying all of our options
and warrants at the time of grant by considering a number of objective and subjective factors. We have obtained the assistance
of an independent valuation firm and applied a market approach using recent third-party transactions in our equity. The fair value
of the underlying shares of common stock will continue to be determined by our management until such time as the common stock
is listed or quoted on an established stock exchange, national market system or other quotation system.

Income taxes

We account for income
taxes in accordance with ASC 740, “Income Taxes” (“ASC 740”). ASC 740 prescribes the use of the liability
method, whereby deferred tax asset and liability account balances are determined based on differences between financial reporting
and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the
differences are expected to reverse. We provide a valuation allowance, if necessary, to reduce deferred tax assets to their estimated
realizable value. As of December 31, 2013 and December 31, 2012, we provided a full valuation allowance.

We implement a two-step
approach to recognize and measure uncertain tax positions. The first step is to evaluate the tax position taken or expected to
be taken in a tax return by determining if the weight of available evidence indicates that it is more likely than not that, on
an evaluation of the technical merits, the tax position will be sustained on audit, including resolution of any related appeals
or litigation processes. The second step is to measure the tax benefit as the largest amount that is more than 50% likely to be
realized upon ultimate settlement. We believe that our tax positions are all highly certain of being upheld upon examination.
As such, as of December 31, 2013 and December 31, 2012, we had not recorded a liability for uncertain tax positions.

Convertible
promissory notes

We account for our
outstanding convertible promissory notes in accordance with ASC 470-20, “Debt with Conversion and Other Options” (“ASC
470-20”) and ASC 815 “Derivatives and Hedging” (“ASC 815”). In accordance with ASC 815, we bifurcate
all embedded derivatives that require bifurcation and account for them separately from the convertible debt. Based upon a third
party valuation, we allocated the proceeds from each issuance between the freestanding liability (convertible debt) component,
which is accounted for at cost, and the embedded derivative component, which is remeasured on each reporting date.

In addition, under
the guidelines of ASC 470-20, we measure an embedded beneficial conversion feature on the date of issuance, by allocating a portion
of the proceeds equal to the intrinsic value of the feature to additional paid in capital. The intrinsic value of the feature
is calculated on the date of issuance using the effective conversion price which results from the allocation of the proceeds between
the convertible debt and the embedded derivative component. The intrinsic value is limited to the portion of the proceeds allocated
to the convertible debt. We recognize an embedded beneficial conversion feature related to our convertible promissory notes. The
beneficial conversion feature is amortized to our consolidated statements of comprehensive loss over the term of the liability.

Warrant liability

The fair value of
the liability for our warrants issued to investors in 2013 was calculated using the Black-Scholes model. We accounted for these
warrants according to the provisions of ASC 815 and, based on the anti-dilution protections contained in the warrants, we classified
them as liabilities, measured at fair value for each reporting period until they are exercised or expire, with changes in fair
value recognized in our consolidated statement of comprehensive loss as financial income or expense.

Extended
Transition Period for “Emerging Growth Companies”

We have elected to
use the extended transition period for complying with new or revised accounting standards under Section 102(b)(1) of the Jumpstart
Our Business Act of 2012 (known as the JOBS Act). This election allows us to delay the adoption of new or revised accounting standards
that have different effective dates for public and private companies until those standards apply to private companies. As a result
of this election, our consolidated financial statements may not be comparable to companies that comply with public company effective
dates. Because our consolidated financial statements may not be comparable to companies that comply with public company effective
dates, investors may have difficulty evaluating or comparing our business, performance or prospects in comparison to other public
companies, which may have a negative impact on the value and liquidity of our common stock.

Revenues. For
the twelve months ended December 31, 2013 and 2012, our revenues were approximately $211,000 and $166,000, respectively, an increase
of approximately 27.1%, or $45,000, between the periods. The increase was attributable primarily to an increase in volume of sales,
mainly contributed by sales to new distributors that came onboard during the twelve months ended December 31, 2012 and did not
contribute to sales for that full year.

For the twelve months
ended December 31, 2013, the percentage of revenues attributable to our products was: PainShield - 82.2%; UroShield - 8.4%; and
NanoVibronix NWPT - 9.5%. For the twelve months ended December 31, 2012, the percentage of revenues attributable to our products
was: PainShield - 93.5%; UroShield - 4.5%; and NanoVibronix NWPT - 2%. For the twelve months ended December 31, 2013 and 2012,
the percentage of revenues attributable to our disposable products was 40.3% and 39.7%, respectively. For the twelve months ended
December 31, 2013 and 2012, the portion of our revenues that was derived from distributors was 64.3% and 58.5%, respectively.

Our revenues may fluctuate
as we add new customers or when existing customers make large purchases of our products. For example, during 2013, our revenues
were $34,000, $86,000, $47,000 and $44,000 for the first, second, third and fourth quarters, respectively. Our revenues
were higher during the second quarter of 2013 due to two large orders, one placed by a new customer and one placed by an existing
customer. It is usual for a new customer to place a large initial order. Due to this potential inconsistency, our revenues may
fluctuate from quarter-to-quarter and, as we continue to grow our business, growth in revenues by quarter may not be linear or
consistent.

Gross Profit.
For the twelve months ended December 31, 2013, gross profit increased by approximately 3.4%, or $4,000, to approximately $120,000
from approximately $116,000 during the same period in 2012. The key driver of the increase in gross profit was our increase in
revenues, described above.

Gross profit as a
percentage of revenues was 56.9% for the twelve months ended December 31, 2013 and 69.9% for the same period in 2012. The decrease
was primarily due to a write-off of inventory in the amount of approximately $19,000 during the twelve months ended December 31,
2013 and the fact that a greater percentage of our sales during the twelve months ended December 31, 2013 were made through distributors,
which sales have lower gross margins.

Research and Development
Expenses. For the twelve months ended December 31, 2013 and 2012, research
and development expenses were approximately $620,000 and $572,000, respectively, an increase of approximately 8.4%, or $48,000,
between the periods. The increase was mainly due to an increase in stock-based compensation expenses of approximately $196,000,
to approximately $213,000 from approximately $17,000, offset by a decrease in clinical research expenses of approximately $53,000,
a decrease in subcontract expenses of approximately $20,000 and a decrease in royalty payment of approximately $75,000 due to
a payment we were required to make under a licensing agreement during the twelve months ended December 31, 2012.

Research
and development expenses as a percentage of total revenues were approximately 293.8% and 344.6%for
the twelve months ended December 31, 2013 and 2012, respectively. The decrease was due to our increase in revenues, described
above.

Our research and development
expenses consist mainly of payroll expenses to employees involved in research and development activities, stock based compensation
expenses, expenses related to subcontracting, patents, clinical trial and facilities expenses associated with and allocated to
research and development activities.

Selling and Marketing
Expenses. For the twelve months ended December 31, 2013 and 2012, selling and marketing expenses were approximately $244,000
and $190,000, respectively, an increase of approximately 28.4%, or $54,000, between the periods. The increase was mainly due to
an increase in stock-based compensation expenses of approximately $44,000, to approximately $51,000 from approximately $7,000.

Selling and marketing
expenses as a percentage of total revenues were approximately 115.6% and 114.5% for the twelve months ended December 31, 2013
and 2012, respectively. The increase was due to the increase in our selling and marketing, described above.

General and Administrative
Expenses. For the twelve months ended December 31, 2013 and 2012, general and administrative expenses were approximately $366,000
and $128,000, respectively, an increase of approximately 185.9%, or $238,000, between the periods. The increase was mainly due
to an increase in stock-based compensation expenses of approximately $211,000, to approximately $215,000 from approximately $4,000,
and increase in professional services and accounting expenses of approximately $21,000.

General and administrative
expenses as a percentage of total revenues were approximately 173.5% and 77.1% for the twelve months ended December 31, 2013 and
2012, respectively. The increase was due to the increase in general and administrative expenses, described above.

29

Our general and administrative
expenses consist mainly of payroll expenses for management and administrative employees, share-based compensation expenses, accounting
and facilities expenses associated with general and administrative activities.

Other Income.
For the twelve months ended December 31, 2013 and 2012, other income was $36,000 and $0, respectively. The increase was
due to a windfall payout derived from the distribution of cash to us as an eligible member of Medmarc Insurance Group, which was
demutualized in its acquisition by Proassurance Corporation.

Financial Expenses,
net. For the twelve months ended December 31, 2013 and 2012, financial expenses, net were $880,000 and $501,000, respectively,
an increase of approximately 75.6%, or $379,000, between the periods. The increase resulted primarily from the amortization of
the beneficial conversion feature of our convertible promissory notes and accrued interest on our convertible promissory notes.

Tax expenses. For
the twelve months ended December 31, 2013 and 2012, tax expenses were $35,000 and $0, respectively. The tax expense is computed
by multiplying income before taxes at our Israeli subsidiary by the appropriate tax rate. The increase was due to the fact that
our Israeli subsidiary had taxable income in 2013.

Net Loss. Our
net loss increased by approximately $714,000, or 56.0%, to approximately $1,989,000 for the twelve months ended December 31, 2013
from approximately $1,275,000 during the same period in 2012. The increase in net loss resulted primarily from the factors described
above.

Liquidity and Capital Resources

We continue to incur
losses and negative cash flows from operating activities. For the twelve months ended December 31, 2013, we had losses of approximately
$1,989,000 and negative cash flows from operating activities of approximately $602,000. These conditions raise substantial doubts
about our ability to continue as a going concern. Our ability to continue to operate is dependent upon raising additional funds
to finance our activities. We aim to have our securities listed on the NASDAQ Stock Market, for the purpose of raising capital
to finance our operations. There are no assurances, however, that we will be successful in obtaining an adequate level of financing
to qualify for a NASDAQ listing, or necessary for the long-term development and commercialization of our products.

We are currently meeting
our short-term liquidity requirements with the proceeds of our secured convertible promissory notes, which are borrowings from
a related party (see “Certain Relationships and Related Transactions”). We intend to use the proceeds of the offering
to which this prospectus relates to meet such short-terms requirements as well as to advance our long-term plans. It is our current
belief that the proceeds of this offering will provide sufficient funding to meet our liquidity needs for more than a year.

Our future capital
requirements and the adequacy of our available funds will depend on many factors, including our ability to successfully commercialize
our products, our development of future products and competing technological and market developments. However, we may be unable
to raise sufficient additional capital when we require it or upon terms favorable to us. In addition, the terms of any securities
we issue in future financings may be more favorable to new investors and may include preferences, superior voting rights and the
issuance of warrants or other derivative securities, which may have a further dilutive effect on the holders of any of our securities
then outstanding. If we are unable to obtain adequate funds on reasonable terms, we will need to curtail operations significantly,
including possibly postponing anticipated clinical trials or entering into financing agreements with unattractive terms.

General. As
of December 31, 2013, we had cash and cash equivalents of approximately $94,000, compared to approximately $101,000 as of December
31, 2012. The decrease is attributable primarily to our net loss. We have historically met our cash needs through a combination
of issuance of equity, borrowing activities and sales. Our cash requirements are generally for product development, research and
development cost, marketing and sales activities, finance and administrative cost, capital expenditures and general working capital.

Cash used in our operating
activities was approximately $602,000 for the twelve months ended December 31, 2013 and approximately $787,000 for the same period
in 2012. The most significant usage of cash in our operating activities for the twelve months ended December 31, 2013 and 2012
was a net loss of approximately $1,989,000 and $1,275,000, respectively, offset during the twelve months ended December 31, 2013
by approximately $479,000 in non-cash stock-based compensation.

Cash used in our investing
activities was approximately $5,000 during the twelve months ended December 31, 2013 and 2012.

Cash provided by financing
activities was approximately $600,000 for the twelve months ended December 31, 2013, due to the issuance of convertible promissory
notes, compared to no cash used in or provided by financing activities for the same period in 2012.

Convertible Promissory
Notes. As of December 31, 2013, we had convertible series B-1 promissory notes and convertible series B-2 promissory notes
with an aggregate principal amount outstanding of approximately $2,536,765, with aggregate accrued interest of $574,962, and secured
convertible promissory notes with an aggregate principal amount of $600,000, with aggregate accrued interest of $17,638. As of
December 31, 2013, no principal or interest had been paid on these notes.

30

The convertible series
B-1 promissory notes mature on the earlier of November 15, 2014 or on an accelerated date if there is an event of default, upon
which date the entire outstanding principal balance and any outstanding fees or interest will be due and payable in full. The
convertible series B-1 promissory notes bear interest at the rate of 10% per annum, compounded annually. In addition, the convertible
series B-1 promissory notes are convertible at any time at the holder’s option into shares of our series B-1 participating
convertible preferred stock at an initial conversion price of $0.284 per share, subject to adjustment for stock dividends, stock
splits or combinations. The convertible series B-1 promissory notes, including accrued interest thereon, will automatically convert
into series B-1 participating convertible preferred stock (except for certain such notes, which we anticipate will convert into
series C preferred stock, as described under “Certain Relationships and Related Transactions”) upon the occurrence
of (i) an aggregate investment in us of $3 million or more in a transaction or series of transactions, (ii) our initial public
offering of our common stock pursuant to an effective registration statement under the United States Securities Act of 1933, as
amended, or equivalent law of another jurisdiction, or upon such date as we become subject to the reporting requirements of Section
13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, including, without limitation, upon consummation of a reverse
merger or upon the effectiveness of a registration statement on Form 10 filed by us under the Securities Exchange Act of 1934,
as amended, or equivalent document or (iii) a fundamental transaction. These notes will convert into common stock or series C
preferred stock automatically upon the closing of this offering.

The terms of the convertible
series B-2 promissory notes are the same as those of the convertible series B-1 promissory notes, except that the initial conversion
price is $0.199. These notes, including accrued interest thereon, will convert into common stock or series C preferred stock automatically
upon the closing of this offering.

As of December 31,
2013, the secured convertible promissory notes were scheduled to mature on the earlier of February 28, 2014 (which date was subsequently
extended to June 30, 2014), the closing date of a financing in which we sell an aggregate of at least $250,000 of our debt or
equity securities or on an accelerated upon an event of default, upon which date the entire outstanding principal balance and
any outstanding fees or interest would be due and payable in full. The secured convertible promissory notes bear interest at the
rate of 6% per annum, which rate is increased to 10% upon and during the occurrence of an event of default. Events of default
are comprised of: (i) failure to pay indebtedness under the notes when due; (ii) a default in a covenant, obligation or agreement
under the notes or related documents; (iii) any representation, warranty or certification made by us under the notes is false
or incorrect in any material respect on the date made; (iv) the occurrence of a liquidation, insolvency or bankruptcy event; (v)
the entry of certain final judgments against us; (vi) our failure to make required payments under other debt, the acceleration
of the maturity date on other debt, or a demand or requirement that we redeem, repurchase or retire other debt prior to its maturity;
(vii) a material adverse effect, as defined in the notes; (viii) any material impairment in the value of the collateral or the
priority of the lenders’ liens; (ix) any levy upon, seizure or attachment of a material portion of the collateral; (x) our
assertion that any transaction document related to the notes is invalid or unenforceable; and (xi) the lenders cease to have a
perfected lien in any of the collateral, subject to certain exceptions. The secured convertible promissory notes are convertible
either at the holders’ option or upon maturity into shares of our series C preferred stock at an initial conversion price
of $2.66 per share, subject to adjustment for stock splits, fundamental transactions or similar events (we anticipate that these
notes will be amended to convert into series C preferred stock, as described under “Certain Relationships and Related Transactions”).
The holders of the secured convertible promissory notes have a security interest in all of our assets and those of our subsidiaries.
These notes, including accrued interest thereon, will convert automatically upon the closing of this offering.

Material Commitments

Under the terms of
the license agreement for NanoVibronix NWPT, if we have not paid aggregate royalty payments of at least $150,000 by August 2014,
we are required to pay the difference. We made an advance payment of $75,000 on account of future royalties during 2012 and remain
obligated to pay $75,000 by August 2014.

Off Balance Sheet Arrangements

As of December 31,
2013, we have no off-balance sheet transactions, arrangements, obligations (including contingent obligations), or other relationships
with unconsolidated entities or other persons that have, or may have, a material effect on our financial condition, changes in
financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

Factors That May Affect Future Operations

We believe that our
future operating results will continue to be subject to quarterly variations based upon a wide variety of factors, including the
ordering patterns of our distributors, timing of regulatory approvals, the implementation of various phases of our clinical trials
and manufacturing efficiencies due to the learning curve of utilizing new materials and equipment. Our operating results could
also be impacted by a weakening of the Euro and strengthening of the New Israeli Shekel, or NIS, both against the U.S. dollar.
Lastly, other economic conditions we cannot foresee may affect customer demand, such as individual country reimbursement policies
pertaining to our products.

BUSINESS

Overview

We were organized as a Delaware corporation
in October 2003. Through our wholly-owned subsidiary, NanoVibronix Ltd., a private company incorporated under the laws of the
State of Israel, we focus 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 products currently consist of:

·

WoundShield, a patch-based therapeutic ultrasound device that facilitates tissue regeneration
and wound healing by using ultrasound to increase local capillary perfusion and tissue oxygenation;

·

NanoVibronix NPWT, a small, lightweight pump with features that allow contamination-free
handling of infected wound exudate and enhanced patient mobility;

UroShield, an ultrasound-based product that is designed to prevent biofilm in urinary catheters,
increase antibiotic efficacy and decrease pain and discomfort associated with urinary catheter use.

Each of our WoundShield, PainShield and
UroShield 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 increase antibiotic efficacy. 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. Our NanoVibronix NPWT is based on an existing standard of care for wound therapy treatment and employs a technology
that drains open cavity wounds and seeks to accelerate wound healing.

PainShield and NanoVibronix NPWT are currently
approved for marketing in the U.S. by the U.S. Food and Drug Administration and all of our products, except for NanoVibronix NPWT,
have CE Mark approval in the European Union. We anticipate that we will apply for CE Mark approval for NanoVibronix NPWT within
six months after the closing of the offering to which this prospectus relates. We have a Canadian medical device license for PainShield
and UroShield, a certificate allowing us to sell PainShield, WoundShield and UroShield in Israel, a certificate allowing us to
sell PainShield in Australia, and we are able to sell PainShield, WoundShield and UroShield in India and Ecuador based on our
CE Mark. In addition, our distributor in Korea has applied for approval to sell PainShield and UroShield, and our distributor
in Chile has applied for approval to sell PainShield. 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 UroShield.

In the United States, PainShield requires
a prescription from a licensed physician or a physical therapist. If U.S. Food and Drug Administration approval is obtained, the
Company anticipates that WoundShield will require a prescription from a licensed physician in the United States. NanoVibronix
NPWT and UroShield are sold directly to facilities, not patients, and therefore do not require a prescription. In other countries
in which we sell them, PainShield, WoundShield and UroShield are eligible for sale without a prescription.

In addition to the need to obtain regulatory
approvals, as described above, we anticipate that sales volumes and prices of our WoundShield and PainShield products will depend
in large part on the availability of coverage and reimbursement for self-administered use from third party payers. Third party
payers include governmental programs such as Medicare and Medicaid in the U.S., private insurance plans and workers’ compensation
plans. We do not currently have reimbursement codes for self-administered use or clinical use of WoundShield in any of the markets
in which we have regulatory authority to sell WoundShield. Of the markets in which we have regulatory authority to sell PainShield,
we have reimbursement codes in the United States (i.e., Current Procedural Terminology codes or “CPT codes”) for clinical
use only, but do not have such reimbursement codes for self-administered use of the product, although the product is marketed
and sold for such use. NanoVibronix NPWT is generally reimbursed by governmental and other third-party payers in the U.S. With
respect to UroShield, which will be used primarily in a clinical setting, we do not currently have reimbursement codes in any
of the markets in which we have regulatory authority to sell UroShield. We anticipate that we will begin to seek reimbursement
codes for self-administered and clinical use of our products in the markets in which we have regulatory authority to sell such
products after the closing of this offering, however, there is no guarantee that we will be successful in obtaining such codes
quickly, or at all.

Assuming we are able to obtain adequate
financing, including through this offering, we plan to continue to work on the further commercialization of WoundShield and further
marketing of NanoVibronix NPWT. We intend to integrate our WoundShield ultrasound technology into NanoVibronix NPWT, which we
believe would make NanoVibronix NPWT a superior product within the negative pressure wound therapy market. We also intend to conduct
ongoing clinical trials of our PainShield product, with the aim of obtaining a favorable reimbursement code. With respect to our
UroShield product, we are currently seeking a strategic partner that is active in the urology market and would be interested in
integrating UroShield into its range of products. If we locate such a partner, we anticipate that we would continue to pursue
U.S. Food and Drug Administration approval of the product.

In general, ultrasound causes the benefits
cited above by increasing local blood circulation, increasing vascular wall permeability, promoting protein secretion, promoting
enzymatic reactions, accelerating nitric oxide production, promoting angiogenesis (the formation of new blood vessels from pre-existing
vessels) and promoting fibroblast proliferation (fibroblasts are a type of cell that play a critical role in wound healing).

Our proprietary technology consists of
a small, thin (1 millimeter) transducer that is capable of transmitting ultrasonic acoustic waves onto treatment surfaces with
a radius of up to 10 centimeters. This technology allows us to treat wounds by implanting our transducers into a small, portable
self-adhering acoustic patch, thereby eliminating the need for technicians and medical personnel to manually administer ultrasound
therapy, which should reduce the cost of therapy. Moreover, we believe that the delivery of ultrasound through our portable devices
is more effective than existing products, as our technology is better positioned to target the affected areas of the body.

While there are currently a number of products
on the market that treat pain through ultrasound therapy, we believe that our products differentiate themselves because they are
portable, without the requirement to be plugged into an outlet and they have a frequency of 100kHz (in contrast to other devices,
which have a frequency of 1MHz), which means they do not produce heat that can damage tissue. They can therefore be self-administered
by the patient without the need to be moved about the treated area by the patient or a clinician, they can be applied for a significantly
longer period without the risk of tissue damage and they do not require the use of gel. We are aware of one product, which has
recently received U.S. Food and Drug Administration approval and also has CE Mark approval, that we understand does not need to
be plugged in and operates at a frequency of 3 MHz, which its manufacturer claims overcomes the need for movement around the treated
area and allows for a longer treatment period. We understand that this product does not generate surface acoustic waves as our
products do, which means that the treatment area is generally limited to that of the transducer’s diameter (see the diagram
below), that the use of transmission gel is still required and that the transducer thickness is significantly greater than ours
(approximately 1.5cm). It is also our understanding that the U.S. Food and Drug Administration has prohibited the manufacturer
from labeling or promoting this product for use directly over bone that is near the skin surface. We are also aware of a small
clinical study, for which results were reported in August 2013, in which a small ultrasound device showed positive results in
the treatment of venous ulcers, a type of chronic wound. Based upon currently available information about this device, we believe
it will be at least five years before this device is available on the market. We understand that this product also does not generate
surface acoustic waves, as our products do, and would likely be heavier and thicker than our products. However, given the early
stage of development of this potential device, we cannot say with certainty how our products would compare.

33

Traditional ultrasound
device and our portable ultrasound patch-based device and a comparison of their energy distribution, where the X-axis represents
treatment surface and the Y-axis represents ultrasound energy penetration depth within tissue.

In a comparison of a traditional ultrasound
device and our portable ultrasound patch-based device, the bulk wave conventional ultrasound machines with handheld transducers
distribute the energy deeply into the body, as shown above in diagram (A) on the left. In comparison, our device distributes the
energy on the surface, as shown in diagram (B), thereby greatly increasing the treatment area. Our transducers may also be incorporated
into treatment patches, including patches that are designed to deliver medicine and other compounds through the skin. The generation
and delivery of low frequency ultrasound over a period of time to a specific area has been termed “targeted slow-release
ultrasound”. We believe that this delivery method of ultrasound may be comparable to that of slow release medication in
the pharmaceutical industry. This “targeted slow-release” capability is intended to allow for more frequent targeting
of the intended treatment area and thus may result in a more effective therapeutic response.

Our Products

WoundShield
and NanoVibronix NPWT

WoundShield

Our WoundShield product is intended to
treat acute and chronic wounds with a disposable treatment patch that delivers localized therapeutic low frequency ultrasound.
The WoundShield patch has two configurations: one that is placed adjacent to the wound and another, called the instillation patch,
that is placed on the wound to enable instillation through sonophoresis, a process that increases the absorption of semisolid
topical compounds, including medications, into the skin. Based on studies conducted by BIO-EC Microbiology Laboratory and Rosenblum,
we believe that our WoundShield product possesses significant potential for the treatment of, among other things, diabetic foot
ulcers and burns (Gasser P, Study Report delivered by BIO-EC Microbiology Laboratory, Dec 2007, which we ordered, paid for, and
provided devices for; Rosenblum J, “Surface Acoustic Wave Patch Diathermy Generates Healing In Hard To Heal Wounds,”
European Wound Management Association 2011, for which we supplied devices but had no further involvement).

Picture of WoundShield Driver and Instillation
Patch

34

WoundShield delivers surface acoustic waves
to the location of the wound. Surface acoustic waves move laterally across the surface of the wound, which enables the transfer
of the acoustic energy of the waves along the entire wound surface in a continuous and consistent mode, providing access to the
waves’ benefits for a longer treatment period than conventional ultrasound without the need for supervision or a treatment
session by a clinician.

WoundShield has been found to have a positive
effect on the epithelialization (healing by the growth of epithelial cells) of diabetic wounds, as well as on the stimulation
of the precursors of dermal and epidermal (skin) growth. As such, it is a useful adjunct to wound care by increasing dermal and
epidermal growth, including glycosaminoglycans, or GAGs (which bind to extracellular proteins like collagen, fibronectin, laminin,
etc. and retain considerable amounts of water, thus preserving the skin structure) as well as the amount of collagen (a protein
that helps skin heal) and decreasing the number of cells in mitosis (a type of cell division) (Gasser P, Study Report delivered
by BIO-EC Microbiology Laboratory, Dec 2007, which we ordered, paid for, and provided devices for; Rosenblum J, “Surface
Acoustic Wave Patch Diathermy Generates Healing In Hard To Heal Wounds,” European Wound Management Association 2011, for
which we supplied devices but had no further involvement). In addition, the WoundShield instillation patch allows for administration
of therapeutic agents into the wound area through a sonophoresis effect.

Many key processes in wound healing are
dependent upon an adequate supply of oxygen. Diabetic foot ulcers are particularly in need of an adequate oxygen supply because
the disease often results from poor perfusion (blood flow) and decreased oxygen tension. Oxygen is also important for the immune
system to ensure bacterial killing, synthesis of collagen, fibroblast proliferation (fibroblasts are a type of cell that play
a critical role in wound healing), oxidative (taking place in the presence of oxygen) pathways for adenosine triphosphate, or
ATP, formation (ATP transports chemical energy within cells for metabolism) and the nitric oxide dependent signaling pathways.
It is generally believed that a lack of available oxygen is a basic contributing factor in the perpetuation of these wounds. Recently,
wound healing experts have developed a technique of perfusing ischemic wounds (which occur when blood flow is blocked) with hyper-oxygenated
saline, while the wound is being treated with ultrasound, also known as sonication. This localized oxygenation therapy has many
advantages over the use of hyperbaric chambers (large chambers in which the oxygen pressure is above normal), a common method
for delivering oxygen to wounds, as it is more cost-effective, can be done at the patient’s bedside and can be administered
more frequently. The WoundShield instillation patch was tested as a potential ultrasound technology for this localized oxygen
therapy and its performance exceeded the performance of the other ultrasound technologies tested. In one study (Morykwas M, “Oxygen
Therapy with Surface Acoustic Waveform Sonication,” European Wound Management Association 2011; we supplied devices for
this study, but had no further involvement with it), oxygen sensors were placed in the wound bed to directly measure partial pressure
of oxygen in an ischemic wound bed on a pig. The wound was perfused with hyperbaric oxygen and sonicated using the WoundShield
instillation patch. With surface acoustic wave ultrasound technology, tissue oxygen levels (partial pressure of oxygen in the
blood, or PaO2) were raised from a range of 20 mmHg (millimeters of mercury) to 60 mmHg in peripheral (periwound) areas, a 3 centimeter
distance away from the transducer, and from 40 mmHg to greater than 100 mmHg in the central wound bed lying below the WoundShield
instillation patch (see table below). The results of this study illustrated that the WoundShield instillation patch allowed oxygen
to directly enter into the wound. The direct entry of the oxygen increased the amount of oxygen reaching the wound, which has
been shown to advance the healing process. In addition, we believe that WoundShield’s small size, lower cost and ease of
use makes localized oxygen treatment commercially viable.

In 2012, results were published of a human
feasibility trial for the WoundShield instillation patch that was performed at Duke University in North Carolina. Seven patients
were treated with the WoundShield instillation patch for their wounds and average tissue oxygen levels (PaO2) increased by an
average of 58% over baseline (Covington S, “Ultrasound-Mediated Oxygen Delivery to Lower Extremity Wounds,” Wounds
2012; 24(8)). We supplied devices for this trial, but had no further involvement with it. Based upon the results of this trial,
we are planning a series of clinical trials with an end point claim that our WoundShield product enhances perfusion in chronic
wounds.

While we are currently developing and marketing
WoundShield and NanoVibronix NPWT as separate products, we intend to develop and market a new product that integrates the two.
We anticipate that the integration of the WoundShield ultrasound technology and the NanoVibronix NPWT platform will create a product
that provides the benefits of both negative pressure wound therapy and ultrasound therapy. We believe that this new device will
be very attractive due its ability to deliver multiple methods of wound therapy in one device. This product, however, will require
separate approval by the U.S. Food and Drug Administration. To secure early approval for this product, we intend to design a clinical
trial that is similar to the clinical trials being designed for WoundShield that focus on enhancing perfusion in chronic wounds.
We anticipate that the integrated WoundShield and NanoVibronix NPWT product could be developed and submitted for U.S. Food and
Drug Administration approval in the fourth quarter of 2014.

Market for Wound-Healing
Devices

The global wound care device market is
continuously growing and expected to reach $20.3 billion by 2015 (“Anticipated market in 2015, Wound Care Products: A Global
Strategic Business Report,” September 2011). In addition, the negative pressure wound therapy market is expanding, in light
of recent approvals in Japan and a growing diabetes patient pool and currently is estimated at approximately $2 billion (“Negative
Pressure Wound Therapy Market to 2017,” GBI Research, June 2012).

According to a report entitled “Advances
in Wound Closure Technology” by Frost and Sullivan (2005), approximately 25% of all patients with diabetes develop a foot
or leg ulceration at some time during the course of their disease. Some 3.5 million individuals globally suffer from diabetes
related foot or leg ulcerations each year. In addition, according to the National Hospital Ambulatory Medical Survey (2000-2004),
approximately 500,000 patients receive medical treatment annually for burn injuries in the U.S., with the global number estimated
at 1 million. There are also policy-based factors that may increase the size of the wound care market. For example, the Commonwealth
of Massachusetts announced a policy not to pay for patients who develop Grade 3 or 4 pressure ulcers acquired in a healthcare
facility. We anticipate that these types of decisions will be made on a more widespread basis, which may create a large market
opportunity for wound care products, including WoundShield. Furthermore, in 2009, the Centers for Medicare and Medicaid Services
announced that they would stop reimbursements for treatment of certain complications that they believed were preventable with
proper care. One such complication was surgical site infections after certain elective procedures, including some orthopedic surgeries
and bariatric surgery. We believe that such developments incentivize medical care providers to invest in reducing the risk of
infection through the use of wound care products, including WoundShield and our planned NanoVibronix NPWT product with WoundShield
technology.

36

Competition for
WoundShield and NanoVibronix NPWT

The market for advanced wound care includes
a large number of competitors, such as Kinetic Concepts, Inc., or KCI, Smith and Nephew plc and Convatec Inc., all of whom market
wound-healing medical devices. Due to their size, in general these companies may have significant advantages over us. These competitors
have their own distribution networks for their products, which gives them an advantage over us in reaching potential customers.
In addition, they are vertically-integrated, which may allow them to maximize efficiencies that we cannot achieve with our third-party
suppliers and distributors. Finally, because of their significantly greater resources, they could potentially choose to focus
on research and development of technology similar to ours, more than we are able to. In general, we believe that these competitors
have, and will continue to have, substantially greater financial, technological, research and development, regulatory and clinical,
manufacturing, marketing and sales, distribution and personnel resources than we do. However, we believe that our products differentiate
us from these competitors, and we will be competitive on the basis of our advantageous technology.

At present, ultrasound treatment for wounds
is limited only to wound debridement (removal of damaged tissue or foreign objects from a wound) and such products are marketed
by Misonix Inc., which produces SonicOne products, and Celleration Inc., which produces the MIST Therapy System. Due to their
size, in general these companies may have the same advantages over us discussed with respect to our competitors in the paragpraph
above. However, both of these ultrasound devices are indicated for use only in medical clinics and require an operator to deliver
their treatment, thus limiting their use and application. The MIST Therapy System is a non-contact ultrasound device that delivers
ultrasound through a mist that is applied directly on the wound.

We believe that these therapies are less
advantageous than WoundShield because they require an operator to deliver the treatment and the removal of bandages to target
the wound bed. In contrast, the WoundShield patch sits on normal skin bordering the open wound and no manipulation of the wound
bandage is required. Moreover, WoundShield can be self-administered, without an operator, in both clinics and home settings. We
also believe that WoundShield will be able to provide superior wound care therapy at a lower price than the existing products
being used by medical practitioners. As such, we believe that facilities that are reimbursed based upon diagnosis-related groups
will be more inclined to adopt WoundShield because it will provide the same therapeutic results at a significantly lower cost
than traditional ultrasound therapies.

We are also aware of a small clinical study,
for which results were reported in August 2013, in which a small ultrasound device showed positive results in the treatment of
venous ulcers, a type of chronic wound. Based upon currently available information about this device, we believe it will be at
least five years before this device is available on the market. We understand that this product does not generate surface acoustic
waves as our products do, which means that the treatment area is generally limited to that of the transducer’s diameter.
We believe our products would have certain other advantages over this potential device, if developed, including that our products
weigh less and are thinner. However, given the early stage of development of this potential device, we cannot say with certainty
how our products would compare.

The most common method of oxygen administration
for wound healing is hyperbaric oxygen therapy, especially to treat specific ulcerations in diabetic patients. Hyperbaric oxygen
therapy has been shown to increase vascular endothelial growth factor expression, which measures the creation of new blood vessels
(Fok TC, at el, "Hyperbaric oxygen results in increased vascular endothelial growth factor (VEGF) protein expression in rabbit
calvarial critical-sized defects", Schulich School of Medicine and Dentistry, University of Western Ontario, Canada). The
activation of endothelial cells by VEGF sets in motion a series of steps toward the creation of new blood vessels (J Lewis et
al, National Cancer Institute, Understanding Cancer and Related Topics, Understanding Angiogenesis). We believe that the WoundShield
instillation patch, which can be used as an oxygen instillation system, will be complementary to, or in some cases an alternative,
to the use of hyperbaric chamber therapy. This complementary treatment option will allow the treating physician greater therapeutic
versatility in treating wounds. For a certain populace of patients, we believe that the WoundShield instillation patch could provide
physicians with an alternative to hyperbaric oxygen therapy because it provides the same benefits as hyperbaric oxygen therapy
at a lower cost to the patient. There are a number of competitors in the hyperbaric chamber therapy market, including over twelve
companies in the U.S. Due to their size, in general these companies may have the same advantages over us discussed with respect
to our competitors in the first paragpraph of this section. However, we believe that the WoundShield instillation patch possesses
certain advantages over the existing hyperbaric chamber therapy, including lower cost and greater ease of use. In addition, we
do not believe that the WoundShield instillation patch will necessarily compete with hyperbaric chamber therapy, but rather will
often complement such therapy.

While we believe that WoundShield is well
positioned to capture a share of the wound care market, WoundShield may be unable to achieve its anticipated place in the wound
care market due to a number of factors, including, but not limited to, an inability to obtain the approval of the U.S. Food and
Drug Administration, its failure to treat wounds for which it is indicated and its failure to be adopted by health care practitioners
and facilities or patients because of its status as a new product in a market that relies on patient-focused initiative to treat
wounds.

In the negative pressure wound therapy
market, in 2010, Kinetic Concepts, Inc. possessed a 74% global market share. Smith & Nephew plc was the only major company
at that time to compete with Kinetic Concepts, Inc. However, due to the expiration of Kinetic Concepts, Inc.’s patents for
negative pressure technology, additional companies such as Medela, Talley Group Limited and Mölnlycke Health Care have entered
this market and now offer competing products in the U.S. and abroad. It is predicted that Kinetic Concepts, Inc.’s global
market share will decline as more companies enter the negative pressure market (“Negative Pressure Wound Therapy Market
to 2017,” GBI Research, June 2012). While the current negative pressure wound therapy market contains both established
companies and a growing number of smaller competitors, we believe NanoVibronix NPWT will be able to establish itself in the market
due to its competitive pricing and the fact that all of the product’s parts that come in contact with wound exudates are
disposable. However, as more negative pressure wound therapy pumps are marketed, it is possible that NanoVibronix NPWT will be
unable to compete against more competitively priced alternatives.

37

In addition, we believe that there currently
is no product in the negative pressure wound therapy market similar to the anticipated integrated WoundShield and NanoVibronix
NPWT product, which we believe should be able to provide both negative pressure therapy and the benefits of ultrasound therapy.
However, we note that because this integrated product is still in its early stages, its anticipated success is dependent upon
a number of factors, including WoundShield obtaining U.S. Food and Drug Administration approval and the ability for the integrated
product to be commercialized prior to the commercialization of any similar products by our competitors.

Regulatory Strategy

For a general discussion of the U.S. Food
and Drug Administration approval process with respect to our products, and regulation of our products in general, see “–Government
Regulation” below.

Our general regulatory strategy for our
WoundShield products is focused on seeking U.S. Food and Drug Administration approval for our products for a variety of indications.
We received 510(k) clearance from the U.S. Food and Drug Administration to market NanoVibronix NPWT in the U.S. in August 2012.
Such clearance is for patients who would benefit from a suction device (negative pressure to help promote wound healing by removing
fluids including irrigation and body fluids, wound exudates and infectious materials). Examples of appropriate wound types include
diabetic/neuropathic ulcers, pressure ulcers, chronic wounds, acute wounds, dehisced wounds, partial-burns, and flaps and grafts.

WoundShield obtained CE Mark approval in
November 2012 for use in wound healing. Following preliminary clinical studies that demonstrated WoundShield’s ability to
enhance blood perfusion, we plan to design a clinical trial for WoundShield with an end point of enhanced perfusion in chronic
wounds. We believe that this trial will take approximately six months. We are finalizing the protocol for this study, which we
anticipate will commence before the end of the year. We intend to coordinate this trial with the Centers for Medicare and Medicaid
Services, private insurers and the U.S. Food and Drug Administration to insure that the data generated will be adequate to obtain
U.S. Food and Drug Administration approval and reimbursement when used in the outpatient setting. We believe that seeking U.S.
Food and Drug Administration approval for an indication limited to enhancing perfusion in chronic wounds will require less complicated
clinical trials than if we were to seek approval for other indications, such as wound healing, which in turn will shorten the
time necessary to commercialize WoundShield.

Following U.S. Food and Drug Administration
approval for WoundShield, and once the product is developed, we intend to submit a second U.S. Food and Drug Administration application
for the integrated WoundShield and NanoVibronix NPWT product. Similar to our clinical trials for WoundShield, we intend to structure
these trials with an end point claim of enhanced perfusion in chronic wounds. We believe that the approval process for the integrated
product should be the shorter 510(k) clearance, because both components will already have U.S. Food and Drug Administration approval.

We also intend to begin clinical studies
that compare localized surface acoustic wave-enhanced oxygen therapy for wounds versus either the current standard of care for
such wounds or treatment with the hyperbaric chamber for ischemic wounds. For these studies, we intend to coordinate with the
U.S. Food and Drug Administration to insure that the data generated will be adequate to obtain U.S. Food and Drug Administration
approval for the WoundShield instillation patch and lead to reimbursement of this product. Once we have obtained U.S. Food and
Drug Administration approval for certain limited indications for our WoundShield products, we intend to seek approval for a wider
range of indications, including wound healing.

Sales and Marketing

In January 2013, we entered into an exclusive
distribution agreement for the distribution of NanoVibronix NPWT in the U.S. The distributor has begun marketing NanoVibronix
NPWT through participating in product presentations at conferences related to wound therapy and targeting distributors who are
selling or renting negative pressure wound therapy equipment to clinics and hospitals.

We have sold limited numbers of our WoundShield
products through our website and our distributor in Italy. Following completion of this offering, we intend to aggressively market
WoundShield in Europe and pursue the necessary approvals to commence marketing in the U.S.

Clinical Trials

Negative pressure wound treatment is not
a novel technology and already has a reimbursement code. Therefore, clinical trials with respect to NanoVibronix NPWT are not
needed.

38

With respect to WoundShield, to date, we
have conducted the following evaluation studies:

Therapy showed significant changes in wound, wound size was reduced, patients felt less
pain, necrotic tissue was less adhesive, necrotic tissue decreased in size. The duration of the trial was one week.

Surface acoustic wave technology in conjunction with oxygenated saline can increase interstitial
oxygen in wound bed. This trial to validate proof of concept was put on hold due to financial constraints. The duration of
the trial was two weeks.

If we are able to obtain sufficient funding,
we anticipate conducting the following clinical trials:

Trial

Place

Targeted Start Date/Timing

Objectives

Woundshield ultrasound patch enhances perfusion of
blood

30 patient trial

University of North Carolina (Rex Hospital)

May 2014

6-month duration

Safety and efficacy of Woundshield in enhancing blood flow and oxygenation of wounds.

Safety and efficacy of combination product in enhancing instillation therapy in NanoVibronix
NPWT.

The target dates above
reflect our best estimate as to when these trials will commence, however, numerous factors, both anticipated and unanticipated,
may negatively impact our ability to meet these targeted dates. These factors include, without limitation, delays in obtaining
regulatory approvals, management’s need to change its allocation of resources in light of market and other developments
and unanticipated results of prior clinical trials.

PainShield

PainShield is an ultrasound diathermy device
(diathermy is the production of heat in a part of the body by high-frequency electric currents), consisting of a driver unit and
a disposable patch, which contains our proprietary therapeutic transducer. It delivers a localized ultrasound effect to treat
pain and induce soft tissue healing in a targeted area, while keeping the level of ultrasound energy at a safe and consistent
level of 0.4 watts. We believe that PainShield is the smallest and most portable therapeutic ultrasound device on the market and
the only product in which the ultrasound transducer is integrated in a therapeutic disposable application patch.

The existing ultrasound therapy devices
being used for pain reduction are primarily large devices used exclusively by clinicians in medical settings. PainShield is able
to deliver ultrasound therapy without being located in a health care facility or clinic because it is portable, due to it being
lightweight and battery operated. Because it is patch based and easy to apply, PainShield does not require medical personnel to
apply ultrasound therapy to the patient. The patient benefits include its ease of application and use, faster recovery time, high
compliance, safety and efficacy (Adahan M, et al, “A Sound Solution to Tendonitis: Healing Tendon Tears With a Novel Low-Intensity,
Low-Frequency Surface Acoustic Ultrasound Patch,” American Academy of Physical Medicine and Rehabilitation Vol. 2,
685-687, July 2010). PainShield can be used by patients at home or work or in clinical setting and can be used even while the
patient is sleeping. Its range of applications includes acute and chronic pain reduction and anti-inflammatory treatment.

Picture of PainShield with Patch

PainShield is used to treat tendon disease
and trigeminal neuralgia (a chronic pain condition that affects the trigeminal or 5th cranial nerve, one of the most widely distributed
nerves in the head); previously, the therapeutic options for these disorders have been very limited. PainShield has also been
used to treat pelvic and abdominal pain. To date, the only treatment options for these conditions are pain medication and surgery.

39

Market for PainShield

Pain is one of the most common conditions
that hinder quality of life of vast populations of patients on a regular basis. Pain-related complaints are the most common reason
patients seek treatment from physicians (Prince V, “Pain Management in Patients with Substance-Use Disorders,” Pain
Management, PSAP-VII, Chronic Illnesses). According to Bonica’s Management of Pain (2001), a work considered current in
the industry based on available industry data, and Landro L, “New Ways to Treat Pain: Tricking the Brain, Blocking the Nerves
in Patients When all Else Has Failed,” Wall Street Journal, May 11, 2010, approximately 25% of the U.S. population, 75 million
people, suffer from chronic pain. We estimate that approximately 150 million individuals globally suffer from chronic pain. Studies
have shown that low-frequency ultrasound treatment has yielded positive results for a variety of indications, including tendon
injuries and short-term pain relief (Warden SJ, “A new direction for ultrasound therapy in sports medicine,” Sports
Med. 2003; 33 (2):95-107), chronic low back pain (Ansari NN, Ebadi S, Talebian S, Naghdi S, Mazaheri H, Olyaei G, Jalaie SA, “Randomized,
single blind placebo controlled clinical trial on the effect of continuous ultrasound on low back pain,” Electromyogr Clin
Neurophysiol. 2006 Nov; 46(6):329-36) and sinusitis (Ansari NN, Naghdi S, Farhadi M, Jalaie S, “A preliminary study into
the effect of low-intensity pulsed ultrasound on chronic maxillary and frontal sinusitis,” Physiother Theory Pract. 2007
Jul-Aug; 23(4):211-8). We believe that PainShield’s technology, portability and ease of use may result in it becoming an
attractive product in the pain management and therapy field.

Competition

There are numerous products and approaches
currently utilized to treat chronic pain. The pharmacological approach, which may be the most common, focuses on drug-related
treatments. Alternatively, there are a large number of non-pharmacological pain treatment modalities available, such as ultrasound,
transcutaneous electrical nerve stimulation, or TENS, laser therapy and pulsed electromagnetic treatment. In addition, there are
some technologies and devices in the market that utilize low frequency ultrasound or patch technology. Many patients are initially
prescribed anti-pain medication; however, ongoing use of drugs may cause substantial side effects and lead to addiction. Therefore,
patients and clinicians have shown great interest in alternative pain therapy using medical devices that do not carry these side
effects.

The currently available ultrasound treatments
for chronic pain have generally been accepted by the medical community as standard treatment for pain management. However, the
traditional ultrasound treatments, such as those manufactured or distributed by Mettler Electronics Corp, Metron USA and Zimmer
MedizinSysteme, are stationary devices found only in clinics and other health care facilities that need to be administered to
patients by health care professionals. We are aware of three companies that market smaller ultrasound devices capable of certain
self-administered use for the treatment of pain: Koalaty Products, Inc., Sun-Rain System Corp. and PhysioTEC. These devices generally
function in the same manner, at the same frequency and with the same administration and safety requirements and limitations as
traditional, larger ultrasound devices. We are also aware of one product, which has recently received U.S. Food and Drug Administration
approval and also has CE Mark approval, marketed by ZetrOZ, Inc., that we understand may eliminate certain of these requirements
and limitations, namely the requirement to be plugged in, the need for movement around the treated area and the relatively short
safe treatment period. However, like traditional ultrasound, we understand that this product does not generate surface acoustic
waves as our products do, which means that the treatment area is generally limited to that of the transducer’s diameter,
that the use of transmission gel is still required and that the transducer thickness is significantly greater than ours (approximately
1.5cm). It is also our understanding that the U.S. Food and Drug Administration has prohibited the manufacturer from labeling
or promoting this product for use directly over bone that is near the skin surface. In addition, there are other patch-based methods
of pain treatment, such as TENS therapy. TENS therapy is generally not supported by widespread clinical evidence of its efficacy.
In addition, TENS therapy may be painful and irritating for the patient due to the muscle contractions resulting from the electrical
pulses. PainShield combines the efficacy of ultrasound treatment for pain with the ease of use and portability of a patch-based
system. PainShield also may be self-administered by the patient, including while the patient is sleeping. However, if we are unable
to obtain widespread insurance coverage and reimbursement for PainShield, its acceptance as a pain management treatment would
likely be hindered, as patients may be reluctant to pay for the product out-of-pocket.

Regulatory Strategy

PainShield received 510(k) clearance from
the U.S. Food and Drug Administration in October 2008 for treatment of selected medical conditions such as relief of pain, muscle
spasms and joint contraction. PainShield received CE Mark approval in July 2008 and was also approved for sale by the Israeli
Ministry of Health in 2010. We have a Canadian medical device license for PainShield, a certificate allowing us to sell PainShield
in Australia, and we are able to sell PainShield in India and Ecuador based on our CE Mark. In addition, our distributors in Korea
and Chile have applied for approval to sell PainShield, which approvals we believe we will receive within a few months.

In the U.S., PainShield falls under the
diathermy classification for the treatment of pain for initial reimbursement purposes. The permitted reimbursement codes can be
used in the outpatient supervised medical setting. We intend to coordinate with the Centers for Medicare and Medicaid Services
and private insurers so that reimbursement can be extended to cover the administration of PainShield outside of health care facilities
and clinics. In addition, we intend to conduct clinical trials in order to effectively market PainShield for a larger range of
indications.

40

Sales and Marketing

PainShield was introduced in 2009 as a
treatment for pain and other clinical problems, such as tendonitis, sports injuries, pelvic pain and neurologic pain and we have
sold approximately 1,000 units and 6,000 treatment patches since its introduction. We have entered into distribution agreements
in North America, Europe, Asia, the Middle East and Australia and New Zealand for the distribution of PainShield. We intend to
seek additional distribution opportunities in Europe, East Asia and South America. In addition, we sell PainShield directly to
patients through our website.

In conclusion this study supports the hypothesis that the application of Low Intensity Low
Frequency Surface Acoustic Wave Ultrasound (LILF/SAW) may be associated with a clinically significant reduction of pain severity
among patients suffering from trigerminal neuralgia disease.

If we are able to obtain sufficient funding,
we anticipate conducting the following clinical trials:

Trial

Place

Start Date/Timing

Objectives

PainShield for Trigeminal Neuralgia 80 patient trial

To be determined

To be determined

Safety and Efficacy of PainShield in Trigeminal Neuralgia

PainShield for Pelvic Pain

200 patient trial

To be determined

To be determined

Safety and Efficiacy of PainShield in Chronic Pelvic Pain

UroShield

UroShield is intended to prevent biofilm,
increase antibiotic efficacy in the catheter lumen and decrease pain and discomfort associated with urinary catheter use. It is
designed to be used with any type of indwelling urinary catheter regardless of the material or coating. We believe UroShield is
the first medical device on the market that attempts to simultaneously address all of the aforementioned catheter-related issues.
UroShield is similar in design to WoundShield and PainShield, in that it uses a driver unit that produces low frequency, low intensity
ultrasound. The driver unit connects to a disposable transducer that is clipped onto the external portion of the catheter to deliver
ultrasound therapy to all catheter surfaces as well as the tissue surrounding the catheter.

Picture of UroShield with actuator

The UroShield system has the following
advantageous effects:

·

Prevention or Reduction of Biofilm.
The low frequency ultrasound
generated by UroShield has been shown to decrease adherence of bacteria to catheter surfaces,
thereby reducing biofilm. Biofilm is the complex matrix required for bacteria to grow and
cause infection. See the discussion of our Heidelberg 1 trial below.

·

Decreased Catheter Associated Pain and Discomfort.
We believe that UroShield creates an acoustic envelope
on the surfaces of the catheter, which decreases friction and tissue trauma, pain and discomfort caused by the catheter. In
addition, the tissue in contact with the catheter remains healthier and less traumatized as a result of the application of
low frequency and low intensity ultrasound (Tenke P, “The effectiveness of acoustic energy induced by UroShield in the
prevention of bacteriuria and the reduction of patients’ complaints related to long-term indwelling urinary catheters,”
26th Annual Congress of the European Association of Urology (EAU) Congress, Vienna, March 2011; we supplied devices for this
study and paid for electron microscopy analysis, but had no further involvement with it).

·

Acoustically Augmented Antibiotic Therapy. Antibiotic
resistance in biofilm bacteria is a well-known phenomenon. Although it has been known that ultrasound can increase antibiotic
efficacy in in-vitro models, we do not believe that there has been a practical ultrasound-based medical device that was able
to augment antibiotic efficacy in the clinical setting. UroShield technology has been shown to eradicate biofilm-residing
bacteria by greater than 85% when applied simultaneously with an antibiotic in three clinically relevant species, escherichia
coli, staphylococcus epidermidis and pseudomonas aeruginosa (Banin E, et al., “Surface acoustic waves increase the susceptibility
of Pseudomonas aeruginosa biofilms to antibiotic treatment,” Biofouling, August 2011; we supplied devices for this study,
but had no further involvement with it).

·

Preservation of the Patency of Catheters. We believe
that low frequency ultrasound applied to catheters will add an anti-clogging effect and will preserve patency of catheters.
This effect is achieved by ultrasound waves creating an acoustic layer on the inner lumen of the urinary catheter, thereby
preventing adherence of biological material and bilofilm formation. We believe that this anti-clogging benefit will help prevent
local infection and sepsis secondary to catheter obstruction.

42

UroShield has undergone a number of clinical
trials. The Heidelberg 1 trial, which we sponsored, was a 22 patient randomized, double blind, sham-controlled, independent trial
that tested UroShield’s safety and ability to prevent biofilm in patients with an indwelling Foley catheter. The trial demonstrated
that UroShield prevented biofilm in all patients with the active device as compared to biofilm being found in seven of eleven
of the control patients. In addition, there was a marked decrease in pain, discomfort and spasm in the active UroShield patients,
as evidenced by a statistically significant decrease in the requirement for the medications required to treat urinary catheter
associated pain and discomfort (Ikinger U, “Biofilm Prevention by Surface Acoustic Nanowaves: A New Approach to Urinary
Tract Infections?,” 25th World Congress of Endourology and SWL, Cancun, Mexico, October 2007).

In a subsequent physician-sponsored trial
known as Heidelberg 2, 40 patients who underwent radical prostatectomies were divided into two groups, with the active group receiving
one intra-operative dose of antibiotics and UroShield and the control group receiving one intra-operative dose of antibiotics
and then five subsequent doses over three days. At the end of the trial, the control group had four cases of bacteruria, as compared
to one in the active group. In a third trial, a physician-sponsored open label trial, ten patients who received emergency placement
of a urinary catheter due to acute obstruction were given a UroShield device and followed with regard to their pain, discomfort,
spasm and overall well-being. Within 24 hours, all patients showed improvement and increased toleration of the catheter (Zillich
S., Ikinger U, “Biofilmprävention durch akustische Nanowellen: Ein neuer Aspekt bei katheterassoziierten Harnwegsinfektionen?,”
Gesellschaft für Urologie, Heilbronn, Germany, May 2008). We supplied devices for this trial, but had no further involvement
with it.

Market for UroShield

According to Urological Catheters –
A Global Strategic Business Report, Global Industry Analysis Inc. 2003, over 55 million indwelling urinary catheters are sold
annually worldwide. In addition, as of October 1, 2008, Medicare stopped authorizing its payment to hospitals in which patients
have developed a catheter-associated urinary tract infection that was not present on admission. This provides hospitals in the
U.S. with a substantial financial incentive to reduce the occurrence of such infections through the use of products such as UroShield,
which help prevent infections hospitals would otherwise have to treat without reimbursement. In addition, it has been noted that
the Centers for Medicare & Medicaid Services may fine hospitals in the future when their patients develop catheter acquired
urinary tract infection, which will likely increase the incentive of hospitals to invest in technologies that may prevent this
complication (Brown J, et al. “Never Events: Not Every Hospital-Acquired Infection Is Preventable, Clinical Infectious Diseases,
2009, 49 (5)).

Competition

Several types of products have been introduced
to address the growing problem of catheter-acquired infection and biofilm formation on catheter surfaces. Manufacturers offer
antibiotic-coated and antiseptic-impregnated catheters. In addition, manufacturers have produced silver-coated catheters, which
have been shown in small studies to delay bacteruria for about two to four days. However, larger studies did not corroborate this
result; on the contrary, silver hydrogel was associated with overgrowth of gram positive bacteria in the urine (Riley DK, Classen
DC, “A large randomized clinical trial of a silver-impregnated urinary catheter: lack of efficacy and staphylococcal superinfection,”
Am. J. Med. 1995 April; 98(4):349-56).

UroShield has been designed to be added
to any type of catheter, including Foley catheters and silver-coated catheters, to improve a catheter’s infection prevention
performance. UroShield is not intended to replace any existing products or technologies, but instead is intended to assist these
existing products or technologies in preventing catheter-acquired urinary injury and catheter associated complications. UroShield
may be unable to achieve its anticipated catheter market share due to a number of factors, including, but not limited to, an inability
to obtain approval of the U.S. Food and Drug Administration and failure to be adopted by health care practitioners and facilities
because of its status as a new product in the market, without an established niche.

Regulatory Strategy

UroShield received CE Mark approval in
September 2007 and was also approved for sale by the Israeli Ministry of Health in 2008. We have a Canadian medical device license
for UroShield and we are able to sell UroShield in India and Ecuador based on our CE Mark. In addition, our distributors in Korea
and Chile have applied for approval to sell UroShield, which approvals we believe we will receive within a few months.

In the European Union, UroShield has been
marketed for the prevention of biofilm, decreased pain and discomfort associated with urinary catheters and increased antibiotic
efficacy. In the U.S., we intend to seek clearance from the U.S. Food and Drug Administration through the de novo classification
process for UroShield. We submitted our application for 510(k) approval on January 3, 2011. On May 21, 2012, we received a response
from the U.S. Food and Drug Administration proposing that the approval go through the de novo route, which will require clinical
trials with proposed study protocols to be pre-cleared by the U.S. Food and Drug Administration. We are currently seeking a strategic
partner that is active in the urology market to help fund the clinical trials for UroShield to support our U.S. Food and Drug
Administration application. We have not made any further submissions to the U.S. Food and Drug Administration related to UroShield.

Sales and Marketing

We are currently seeking a strategic partner
that is active in the urology market and would be interested in integrating UroShield into its range of products. We have sold
limited numbers of our UroShield products through our website and our distributor in Italy.

43

Clinical Trials

To date, we have conducted the clinical
trials set forth below:

Purpose

Doctor/Location

Time,

subjects

Objectives

Results

To assess the safety of the UroShield

Double Blind, Comparative, Randomized Study for the
Safety Evaluation of the UroShield System (HD1)

To demonstrate that the use of the UroShield is safe and helps in prevention of biofilm
formation and UTI in comparison with the urinary catheter alone, as well as decrease antibiotic use.

In this trial, only 1/20 patients in UroShield device (no antibiotics) group
developed urinary tract infection compared to 4/20 patients within control group treated with the antibiotic prophylaxis alone.

The Effect of UroShield on Pain and Discomfort in Patients
Released from the Emergency Room with Urinary Catheter Due to Urine Incontinence

Physician initiated

Shaare Zedek Medical Center Jerusalem, Israel.

2007

10 patients

The study aimed to assess the effectiveness of the UroShield in reducing pain and discomfort
levels and improve the well-being of the subjects. Efficacy objectives included reduction of pain, spasm, burning and itching
sensation levels of the subjects.

The results demonstrated a reduction in pain, itching,
burning and spasm levels. Additionally, the well-being of the subjects showed a significant increase.

The Use of the UroShield Device in Patients with Indwelling
Urinary Catheters

Open labeled, comparative, randomized study

Dr. Shenfeld

Shaare Zedek Medical Center Jerusalem, Israel.

2007-2009

40 patients

Patient complaints related to catheter regarding pain
according to VAS scale and discomfort according to 0-10 scale

Presence of Clinically Significant UTI

Presence of Bacteriuria

Presence of Biofilm

Use of medication

UroShield device was effective in reducing postoperative catheter related pain discomfort
and bladder spasms. There was also a notable trend towards reduction of bacteriuria.

Evaluation of the UroShield in urinary
and nephrostomies to reduce bacteruria

Physician initiated

Prof. P.Tenke,

Hungary

2010-2011

26 patients

· Pain,
disability and QOL

· Catheter
patency

· Bacteriuria
/ UTI

· Hospitalization
period

· Analgesics
and Antibiotics intake

Showed reduction in pain and significant decrease in bacteriuria
rate.

If we are able to locate a strategic partner
or otherwise obtain sufficient funding, we anticipate conducting the following clinical trial:

Trial

Place

Start Date/Timing

Objectives

UroShield FDA trial 80 patient trial

To be determined

To be determined

Safety and efficacy of UroShield in urinary catheter related pain and infection

44

Third Party Reimbursement

We anticipate that sales volumes and prices
of the products we commercialize will depend in large part on the availability of coverage and reimbursement from third party
payers. Third party payers include governmental programs such as Medicare and Medicaid, private insurance plans and workers’
compensation plans. These third party payers may deny coverage and reimbursement for a product or therapy, in whole or in part,
if they determine that the product or therapy was not medically appropriate or necessary. The third party payers also may place
limitations on the types of physicians or clinicians that can perform specific types of procedures. In addition, third party payers
are increasingly challenging the prices charged for medical products and services. Some third party payers must also pre-approve
coverage for new or innovative devices or therapies before they will reimburse healthcare providers who use the products or therapies.
Even though a new product may have been approved or cleared by the U.S. Food and Drug Administration for commercial distribution,
we may find limited demand for the device until adequate reimbursement has been obtained from governmental and private third party
payers.

In international markets, reimbursement
and healthcare payment systems vary significantly by country, and many countries have instituted price ceilings on specific product
lines and procedures. There can be no assurance that procedures using our products will be considered medically reasonable and
necessary for a specific indication, that our products will be considered cost-effective by third party payers, that an adequate
level of reimbursement will be available or that the third party payers’ reimbursement policies will not adversely affect
our ability to sell our products profitably.

In the U.S., some insured individuals are
receiving their medical care through managed care programs, which monitor and often require pre-approval of the services that
a member will receive. Some managed care programs are paying their providers on a per capita basis, which puts the providers at
financial risk for the services provided to their patients by paying these providers a predetermined payment per member per month,
and consequently, may limit the willingness of these providers to use products, including ours.

One of the components in the reimbursement
decision by most private insurers and governmental payers, including the Centers for Medicare & Medicaid Services, which administers
Medicare, is the assignment of a billing code. Billing codes are used to identify the procedures performed when providers submit
claims to third party payers for reimbursement for medical services. They also generally form the basis for payment amounts. We
anticipate that our distributors will be responsible for the process for obtaining billing codes for our products.

The initial phase of establishing a professional
billing code for a medical service typically includes applying for a Current Procedural Terminology, or CPT, Category III code.
This is a tracking code without relative value assigned that allows third party payers to identify and monitor the service as
well as establish value if deemed medically necessary. The process includes CPT application submission, clinical discussion with
Medical Professional Society CPT advisors as well as American Medical Association CPT Editorial Panel review. A new CPT Category
III code will be assigned if the American Medical Association CPT Editorial Panel committee deems it meets the applicable criteria
and is appropriate.

45

The secondary phase in the CPT billing
code process includes the establishment of a permanent CPT Category I code in which relative value is analyzed and established
by the American Medical Association. The approval of this code is based on, among other criteria, widespread usage and established
clinical efficacy of the medical service.

We believe that the overall escalating
costs of medical products and services has led to, and will continue to lead to, increased pressures on the healthcare industry
to reduce the costs of products and services. In addition, recent healthcare reform measures, as well as legislative and regulatory
initiatives at the federal and state levels, create significant additional uncertainties. There can be no assurance that third
party coverage and reimbursement will be available or adequate, or that future legislation, regulation, or reimbursement policies
of third party payers will not adversely affect the demand for our products or our ability to sell these products on a profitable
basis. The unavailability or inadequacy of third party payer coverage or reimbursement would have a material adverse effect on
our business, operating results and financial condition.

The Diagnosis Related Group System, or
DRG, is the system of reimbursement that is used in the United States for hospitalized patients as well as patients who are cared
for in skilled nursing facilities and long term care facilities. These facilities are not subject to the same reimbursement codes
as described above. In the DRG system, each patient admitted to the hospital or facility is assigned a code based on his or her
diagnosis. That code is known to be associated with an average hospital stay and the health care facility is reimbursed for the
amount of days as defined by the DRG code, regardless of how many days the patient is in the facility. This system gives a strong
incentive for these health care facilities to deliver efficient care and to complete the needed treatment as quickly as possible.
For example, if the patient has a wound that requires healing before discharge and they succeed in treating the wound in less
hospital days than allowed by the DRG code for this diagnosis, the facility will be rewarded by being paid more for more days
than the patient was actually in the hospital for. Conversely, if the treatment takes longer, the facility would actually lose
income, as they will be paid for the DRG code only. This system serves as a stimulus for these facilities to purchase and utilize
devices and technologies that allow more efficient therapy.

PainShield. PainShield is presently
reimbursed in the U.S. by many private insurers for use of the ultrasound device in a supervised medical setting and is reimbursed
in units of 15 minutes up to an hour a day, 5 hours a week and 20 hours a month. If the device is efficacious in the treatment
of the patient’s condition, the treatment period can be extended in some cases for months. Presently, when purchased by
a clinic, PainShield is typically purchased by the clinic that then bills the existing reimbursement codes. PainShield is not
reimbursed for therapy in the home setting. Following completion of the offering to which this prospectus relates, we intend to
work to obtain reimbursement in the home setting as well as codes that would allow for reimbursement for use of the non-disposable
and disposable components of the PainShield device. Our anticipated clinical trials for PainShield would support this effort.

NanoVibronix NPWT. Negative pressure
wound therapy is an accepted advanced wound care therapeutic modality and is reimbursable under accepted codes. NanoVibronix NPWT
is reimbursable under a code that describes a stationary or portable negative pressure wound therapy electrical pump that provides
controlled subatmospheric pressure designed for use with negative pressure wound therapy dressings and canisters to promote wound
healing.

WoundShield. We believe that the
initial usage of the WoundShield patch will be in the hospital setting. Reimbursement in the hospital setting is governed by the
diagnosis-related group system, which does not require specific reimbursement codes. In parallel to introducing the WoundShield
device to hospitals, we intend to apply for reimbursement codes for outpatient use. Although obtaining these codes can take two
to five years and may require extensive clinical data, we believe that the desirable characteristics of the WoundShield may serve
as an incentive to insurance companies to grant these codes more quickly.

46

UroShield. We expect UroShield to
be used in hospital settings and therefore reimbursed under the diagnosis-related group reimbursement system. In addition, we
anticipate that UroShield will initially be purchased privately until a reimbursement code is obtained. However, we believe that
if we can empirically demonstrate UroShield’s efficacy in preventing recurrent hospital admission in chronic Foley catheter
patients and reducing overall per-patient cost, third party payers may accelerate the reimbursement approval process since the
device could reduce their overall per-patient cost.

Research and Development Expenses

During the years ended December 31, 2013
and 2012, we spent approximately $620,000 and $572,000 on research and development activities, respectively.

Intellectual Property

Patents

We believe that our patent portfolio provides
us with sufficient protection of our patentable intellectual property. We have six patents registered in the U.S. and three filed
applications. Granted U.S. Patent No. 7,393,501 (having the following foreign counter-parts: China ZL03818327.7; Israel 165422;
Japan 4504183; India 246351; Australia 2003231892; European Union 1511414 B), “Method, apparatus and system for treating
biofilms associated with catheters” and granted U.S. Patent No. 7,829,029 (having the following foreign counter-parts: China
ZL200780019732.3 and European Union 1998834), “Acoustic add-on device for biofilm prevention in urinary catheter,”
both relate to the use of surface acoustic waves to prevent biofilm formation on indwelling catheters. These granted U.S. patents
expire on December 19, 2023 and October 27, 2025, respectively. Granted U.S. Patent No. 7,892,191 (having the following foreign
counter-parts: Russia 2419395 and Australia 2005331251), “Nanovibration coating process for medical devices using multi
vibration modes of thin piezo element” and U.S Patent Application No. 11/710,616, “System and method for SAW treatment
of medical devices,” relate to methods of generating surface acoustic waves on medical device surfaces on both indwelling
medical devices and implants to prevent biofilm formation. U.S. Patent No. 7,892,191 will expire on December 19, 2023. U.S. Patent
Application No. 11/710,615 (having the following foreign counter-parts: China ZL200780014875.5; applications in India, European
Union, Canada and Israel), “System and method for surface acoustic waves treatment of skin,” relates to methods of
using surface acoustic waves for treatment of skin for the purpose of wound-healing, reducing infection, pain reduction and cosmetic
enhancements. U.S Patent Application No. 13/521,060, “Method for friction reduction in medical tubing and applications using
this method,” relates to the use of acoustic lubrication (complex vibrations) to reduce friction between indwelling medical
devices and vital tissue.

We also license three patents pursuant
to a license agreement with Piezo-Top Ltd and PMG Medica Ltd., U.S. Patent No. 6,454,716 B1, “A system and method for detection
of fetal heartbeat,” and U.S. Patent No. 6,964,640 B2, “A system and method for detection of motion,” which
incorporate certain technology related to biofilm prevention for medical purposes, including biofilm prevention in indwelling
catheters, biofilm prevention in dialysis and respiratory assist devices and control of bacteria in hospital and outpatient environments
by biofilm prevention and the killing of bacteriato. These patents expire on May 23, 2020 and January 22, 2023, respectively.
U.S. Patent No. 7,431,892 B2, “Apparatus for sterilizing a liquid with focused acoustic standing waves,” relates to
our original work introducing multiple modes of power into an ultrasonic transducer for purpose of sterilizing liquids. This patent
has been the genesis of the more practical patents described above. This patent expires on July 29, 2024. See “—License
Agreements” below.

We believe the granted patents, patent
applications and license agreements (described below) collectively cover our existing products to the extent necessary, and may
be useful for protecting our future technology developments. With respect to our NanoVibronix NPWT product, negative pressure
wound therapy is an established technology and we believe that our ability to use such technology is not dependent upon or limited
by the terms or existence of a particular patent or patents. Nonetheless, we are party to a license agreement related to our negative
pressure wound therapy technology, described below. We intend to continue patenting new technology as it is developed, and to
actively pursue any infringement of any of our patents.

To date, we are not aware of other companies
that have patent rights to a system and method for surface acoustic wave treatment.

47

Trademarks

We believe that our product brand names
are an important factor in establishing and maintaining brand recognition. We have the following trademark registrations in the
U.S.: NanoVibronix®, WoundShield®, PainShield®, UroShield® and “Curing though prevention”®. Generally,
the protection afforded for trademarks is perpetual, if they are renewed on a timely basis, if registered, and continue to be
used properly as trademarks.

License Agreements

In October 2003, we entered into a license
agreement with Piezo-Top Ltd and PMG Medica Ltd, pursuant to which we were granted an exclusive, worldwide license for the duration
of the patent life of U.S. Patent No. 6,454,716 B1, U.S. Patent No. 6,964,640 B2 and U.S. Patent No. 7,431,892 B2 (see “—Patents”
above). In exchange for the license, we paid Piezo-Top Ltd and PMG Medica Ltd payments of (i) $5,000 each after the first round
of investment in us, (ii) $7,500 each after the second round of investment in us, and (iii) $25,000 each after either the third
round of investment, the purchase of at least 40% of our stock or our initial public offering. We have made all three of the required
payments under this agreement.

In December 2011, we entered into a license
agreement with AC Engineering Ltd. for the exclusive license to manufacture, market, sell, lease and distribute AC Engineering
Ltd.’s negative pressure wound therapy technology within the U.S. for a term of two years, commencing from the date of the
U.S. Food and Drug Administration approval of the negative pressure wound therapy product, which occurred in August 2012. This
technology is the basis of our NanoVibronix NPWT product. The license agreement also granted us a non-exclusive license to use
AC Engineering Ltd.’s know-how related to the product and to develop modifications and improvements to the product and to
integrate the product into our existing products. The term of the license agreement will be extended automatically for an additional
three year non-exclusive term if we sell at least 3,500 units of pumps during the first two years of the license agreement, and
the term of the license agreement will be extended automatically thereafter for an additional one year non-exclusive term if we
sell at least 1,000 units of pumps during the preceding year. We are obligated to pay AC Engineering Ltd. a royalty payment of
5% of gross revenues from the sale of the pumps and $0.70 per canister. If we have not paid AC Engineering Ltd. aggregate royalty
payments of at least $150,000 by the end of the initial two year term, we will have to pay the difference.

Government Regulation

U.S. Food and
Drug Administration Regulation

Each of our products must be approved or
cleared by the U.S. Food and Drug Administration before it is marketed in the U.S. Before and after approval or clearance in the
U.S., our product candidates are subject to extensive regulation by the U.S. Food and Drug Administration under the Federal Food,
Drug, and Cosmetic Act and/or the Public Health Service Act, as well as by other regulatory bodies. The U.S. Food and Drug Administration
regulations govern, among other things, the development, testing, manufacturing, labeling, safety, storage, record-keeping, market
clearance or approval, advertising and promotion, import and export, marketing and sales, and distribution of medical devices
and pharmaceutical products. Two of our products, PainShield and NanoVibronix NPWT, have already obtained 510(k) marketing approval
by the U.S. Food and Drug Administration.

U.S. Food and
Drug Administration Approval or Clearance of Medical Devices

In the U.S., medical devices are subject
to varying degrees of regulatory control and are classified in one of three classes depending on the extent of controls the U.S.
Food and Drug Administration determines are necessary to reasonably ensure their safety and efficacy:

·

Class I: general controls, such as labeling and adherence to
quality system regulations;

·

Class II: special controls, pre-market notification (510(k)),
specific controls such as performance standards, patient registries and post-market surveillance and additional controls such
as labeling and adherence to quality system regulations; and

·

Class III: special controls and approval of a pre-market approval,
or PMA, application.

All our products are classified as Class
II medical devices and require U.S. Food and Drug Administration authorization prior to marketing, by means of 510(k) clearance,
except for our UroShield product, which we intend to seek clearance from the U.S. Food and Drug Administration through the de
novo classification process, described below.

48

To request marketing authorization by means
of a 510(k) clearance, we must submit a pre-market notification demonstrating that the proposed device is substantially equivalent
to another legally marketed medical device, has the same intended use, and is as safe and effective as a legally marketed device
and does not raise different questions of safety and effectiveness than a legally marketed device. 510(k) submissions generally
include, among other things, a description of the device and its manufacturing, device labeling, medical devices to which the
device is substantially equivalent, safety and biocompatibility information and the results of performance testing. In some cases,
a 510(k) submission must include data from human clinical studies. Marketing may commence only when the U.S. Food and Drug Administration
issues a clearance letter finding substantial equivalence. The typical duration to receive 510(k) approval is approximately nine
months from the date of the initial 510(k) submission, although there is no guaranty that the timing will not be longer.

In the past, the 510(k) pathway for product
marketing required only the proof of significant equivalence in technology for a given indication with a previously cleared device.
Currently, there has been a trend of the U.S. Food and Drug Administration requiring additional clinical work to prove efficacy
in addition to technological equivalence. Thus, no matter which regulatory pathway we may take in the future towards marketing
products in the U.S., we believe we will be required to provide clinical proof of device effectiveness.

After a device receives 510(k) clearance,
any product modification that could significantly affect the safety or effectiveness of the product, or that would constitute
a significant change in intended use, requires a new 510(k) clearance or, if the device would no longer be substantially equivalent,
would require a PMA. If the U.S. Food and Drug Administration determines that the product does not qualify for 510(k) clearance,
then a company must submit and the U.S. Food and Drug Administration must approve a PMA before marketing can begin.

A PMA application must provide a demonstration
of safety and effectiveness, which generally requires extensive pre-clinical and clinical trial data. Information about the device
and its components, device design, manufacturing and labeling, among other information, must also be included in the PMA. As part
of the PMA review, the U.S. Food and Drug Administration will inspect the manufacturer’s facilities for compliance with
quality system regulation requirements, which govern testing, control, documentation and other aspects of quality assurance with
respect to manufacturing. If the U.S. Food and Drug Administration determines the application or manufacturing facilities are
not acceptable, the U.S. Food and Drug Administration may outline the deficiencies in the submission and often will request additional
testing or information. Notwithstanding the submission of any requested additional information, the U.S. Food and Drug Administration
ultimately may decide that the application does not satisfy the regulatory criteria for approval. During the review period, a
U.S. Food and Drug Administration advisory committee, typically a panel of clinicians and statisticians, is likely to be convened
to review the application and recommend to the U.S. Food and Drug Administration whether, or upon what conditions, the device
should be approved. The U.S. Food and Drug Administration is not bound by the advisory panel decision. While the U.S. Food and
Drug Administration often follows the panel’s recommendation, there have been instances where the U.S. Food and Drug Administration
has not. If the U.S. Food and Drug Administration finds the information satisfactory, it will approve the PMA. The PMA approval
can include post-approval conditions, including, among other things, restrictions on labeling, promotion, sale and distribution,
or requirements to do additional clinical studies post-approval. Even after approval of a PMA, a new PMA or PMA supplement is
required to authorize certain modifications to the device, its labeling or its manufacturing process. Supplements to a PMA often
require the submission of the same type of information required for an original PMA, except that the supplement is generally limited
to that information needed to support the proposed change from the product covered by the original PMA. The typical duration to
receive PMA approval is approximately two years from the date of submission of the initial PMA application, although there is
no guaranty that the timing will not be longer.

As describe above, we anticipate that our
UroShield product will receive, a de novo review from the U.S. Food and Drug Administration. De novo is a two-step process that
requires a company to submit a 510(k) and complete a standard review, including an analysis of the risk to the patient and operator
associated with the use of the device and the substantial equivalence rationale. Once that has been accomplished, and the medical
device in question has been determined to be not substantially equivalent to another approved device, the product is automatically
classified as a Class III device. The manufacturer can then submit a request for an evaluation to have the product reclassified
from Class III into Class I or Class II. The U.S. Food and Drug Administration will review the device classification proposal
and either recommend special controls to create a new Class I or II device classification or determine that the product is a Class
III device. If the U.S. Food and Drug Administration determines that the level of risk associated with the use of the device is
appropriate for a Class II or Class I designation, then the product can be cleared as a 510(k) and the U.S. Food and Drug Administration
will issue a new classification regulation and product code. If the device is not approved through de novo review, then it must
go through the standard PMA process for Class III devices.

49

Clinical Trials
of Medical Devices

One or more clinical trials are generally
required to support a PMA application and more recently are becoming necessary to support a 510(k) submission. Clinical studies
of unapproved or uncleared medical devices or devices being studied for uses for which they are not approved or cleared (investigational
devices) must be conducted in compliance with U.S. Food and Drug Administration requirements. If an investigational device could
pose a significant risk to patients, the sponsor company must submit an investigational device exemption application to the U.S.
Food and Drug Administration prior to initiation of the clinical study. An investigational device exemption application must be
supported by appropriate data, such as animal and laboratory test results, showing that it is safe to test the device on humans
and that the testing protocol is scientifically sound. The investigational device exemption will automatically become effective
30 days after receipt by the U.S. Food and Drug Administration unless the U.S. Food and Drug Administration notifies the company
that the investigation may not begin. Clinical studies of investigational devices may not begin until an institutional review
board has approved the study.

During the study, the sponsor must comply
with the U.S. Food and Drug Administration’s investigational device exemption requirements. These requirements include investigator
selection, trial monitoring, adverse event reporting, and record keeping. The investigators must obtain patient informed consent,
rigorously follow the investigational plan and study protocol, control the disposition of investigational devices, and comply
with reporting and record keeping requirements. The sponsor, the U.S. Food and Drug Administration, or the institutional review
board at each institution at which a clinical trial is being conducted may suspend a clinical trial at any time for various reasons,
including a belief that the subjects are being exposed to an unacceptable risk. During the approval or clearance process, the
U.S. Food and Drug Administration typically inspects the records relating to the conduct of one or more investigational sites
participating in the study supporting the application.

Post-Approval
Regulation of Medical Devices

After a device is cleared or approved for
marketing, numerous and pervasive regulatory requirements continue to apply. These include:

·

the U.S. Food and Drug Administration quality systems regulation,
which governs, among other things, how manufacturers design, test, manufacture, exercise quality control over, and document
manufacturing of their products;

·

labeling and claims regulations, which prohibit the promotion
of products for unapproved or “off-label” uses and impose other restrictions on labeling; and

·

the Medical Device Reporting regulation, which requires reporting
to the U.S. Food and Drug Administration of certain adverse experiences associated with use of the product.

Good Manufacturing
Practices Requirements

Manufacturers of medical devices are required
to comply with the good manufacturing practices set forth in the quality system regulations promulgated under section 520 of the
Food, Drug and Cosmetic Act. Current good manufacturing practices regulations require, among other things, quality control and
quality assurance as well as the corresponding maintenance of records and documentation. The manufacturing facility for an approved
product must meet current good manufacturing practices requirements to the satisfaction of the U.S. Food and Drug Administration
pursuant to a pre-PMA approval inspection before the facility can be used. Manufacturers, including third party contract manufacturers,
are also subject to periodic inspections by the U.S. Food and Drug Administration and other authorities to assess compliance with
applicable regulations. Failure to comply with statutory and regulatory requirements subjects a manufacturer to possible legal
or regulatory action, including the seizure or recall of products, injunctions, consent decrees placing significant restrictions
on or suspending manufacturing operations, and civil and criminal penalties. Adverse experiences with the product must be reported
to the U.S. Food and Drug Administration and could result in the imposition of marketing restrictions through labeling changes
or in product withdrawal. Product approvals may be withdrawn if compliance with regulatory requirements is not maintained or if
problems concerning safety or efficacy of the product occur following the approval.

50

International
Regulation

We are subject to regulations and product
registration requirements in many foreign countries in which we may sell our products, including in the areas of product standards,
packaging requirements, labeling requirements, import and export restrictions and tariff regulations, duties and tax requirements.
The time required to obtain clearance required by foreign countries may be longer or shorter than that required for U.S. Food
and Drug Administration clearance, and requirements for licensing a product in a foreign country may differ significantly from
U.S. Food and Drug Administration requirements.

The primary regulatory environment in Europe
is the European Union, which consists of 25 member states and 42 competent authorities encompassing most of the major countries
in Europe. In the European Union, the European Medicines Agency and the European Union Commission determined that WoundShield,
PainShield and UroShield are to be regulated as medical device products. These products are classified as Class II devices. These
devices are CE Marked and as such can be marketed and distributed within the European Economic Area. We are required to be recertified
each year for CE by Intertek, which conducts an annual audit. The audit procedure, which includes on-site visits at our facility,
requires us to provide Intertek with information and documentation concerning our management system and all applicable documents,
policies, procedures, manuals, and other information.

The primary regulatory bodies and paths
in Asia, Australia, Canada and Latin America are determined by the requisite country authority. In most cases, establishment registration
and device licensing are applied for at the applicable Ministry of Health through a local intermediary. The requirements placed
on the manufacturer are typically the same as those contained in ISO 9001 or ISO 13485, requirements for quality management systems
published by the International Organization of Standardization. In some countries outside Europe, we are or will be able to sell
on the basis of our CE Mark. We have a Canadian medical device license for PainShield and UroShield, a certificate allowing us
to sell PainShield, WoundShield and UroShield in Israel, a certificate allowing us to sell PainShield in Australia, and we are
able to sell PainShield, WoundShield and UroShield in India and Ecuador based on our CE Mark. In addition, our distributor in
Korea has applied for approval to sell PainShield and UroShield, and our distributor in Chile has applied for approval to sell
PainShield. 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.

European Good
Manufacturing Practices

In the European Union, the manufacture
of medical devices is subject to good manufacturing practice, as set forth in the relevant laws and guidelines of the European
Union and its member states. Compliance with good manufacturing practice is generally assessed by the competent regulatory authorities.
Typically, quality system evaluation is performed by a notified body, which also recommends to the relevant competent authority
for the European Community CE Marking of a device. The competent authority may conduct inspections of relevant facilities, and
review manufacturing procedures, operating systems and personnel qualifications. In addition to obtaining approval for each product,
in many cases each device manufacturing facility must be audited on a periodic basis by the notified body. Further inspections
may occur over the life of the product.

U.S. Anti-Kickback
and False Claims Laws

In the U.S., there are federal and state
anti-kickback laws that prohibit the payment or receipt of kickbacks, bribes or other remuneration intended to induce the purchase
or recommendation of healthcare products and services. Violations of these laws can lead to civil and criminal penalties, including
exclusion from participation in federal healthcare programs. These laws are potentially applicable to manufacturers of products
regulated by the U.S. Food and Drug Administration as medical devices, such as us, and hospitals, physicians and other potential
purchasers of such products. Other provisions of federal and state laws provide civil and criminal penalties for presenting, or
causing to be presented, to third-party payers for reimbursement, claims that are false or fraudulent, or which are for items
or services that were not provided as claimed. In addition, certain states have implemented regulations requiring medical device
and pharmaceutical companies to report all gifts and payments over $50 to medical practitioners. This requirement does not apply
to instances involving clinical trials.

51

Customers

We initially sell our products both through
our website and distribution agreements, though a majority of our sales are currently through distributors. We currently have
exclusive distribution agreements for our products with medical product distributors based in the U.S. (for PainShield for abdominal
and pelvic pain since 2012, for NanoVibronix NPWT since 2013), Italy (since 2013), India (since 2012), Australia (since 2012),
New Zealand (since 2012), Ecuador (since 2012), United Kingdom (since 2010) and Israel (since 2012). In May 2013, we entered into
a non-exclusive distribution agreement for the distribution of PainShield for all indications other than abdominal and pelvic
pain in the U.S. and Canada.

We are currently in discussions with multiple
distribution companies in Europe, Asia, and Latin America. Current and future agreements with distributors stipulate that, while
we are responsible for training, providing marketing guidance, marketing materials, and technical guidance, distributors will
be responsible for carrying out local marketing activities and sales. In addition, in most cases, all sales costs, including sales
representatives, incentive programs, and marketing trials, will be borne by the distributor. Under current agreements, distributors
purchase our products from us at a fixed price. Our current agreements with distributors are generally for a term of approximately
two to three years and automatically renew for an additional annual terms unless modified by either party.

Manufacturing and Suppliers

We assemble our own products at our facilities
in Nesher, Israel. All of the component parts of our products are readily available from a number of manufacturers and suppliers.
We order component parts on an as-needed basis, generally from the manufacturer that provides us with the most competitive pricing.
Our most significant suppliers are APC International, Ltd., Rotel Product Engineering Ltd. and Amit Industries L.T.D (AmiCell).
We do not have written agreements with any of these suppliers, but we believe any one could be easily replaced if necessary.

Employees

As of April 28, 2014, we had nine full-time
employees and two part-time employees. Our employees are not party to any collective bargaining agreements. We consider our relations
with our employees to be good. We believe that our future success will depend, in part, on our continued ability to attract, hire
and retain qualified personnel.

Properties

We lease an office and manufacturing facility
in Nesher, Israel and an office in Melville, New York. Our lease for the facility in Nesher expires December 31, 2015, with an
option to renew annually. The space is approximately 230 square meters. We pay approximately $2,880 per month under our lease.
Our lease for the facility in Melville expires May 24, 2014, with an option to renew annually. The space is approximately 15 square
meters. We pay $915 per month under our lease. We believe that our facilities are adequate to meet our current and proposed needs.

Legal Proceedings

From time to time, we may be involved in
litigation that arises through the normal course of business. As of the date of this filing, we are not a party to any material
litigation nor are we aware of any such threatened or pending litigation.

There are no material proceedings in which
any of our directors, officers or affiliates or any registered or beneficial shareholder of more than 5% of our common stock,
or any associate of any of the foregoing is an adverse party or has a material interest adverse to our interest.

52

MANAGEMENT

The following table sets forth information
regarding our executive officers, our future chief financial officer, the members of our board of directors and certain director
nominees who will join our board upon the pricing of this offering. All directors hold office for one-year terms until the election
and qualification of their successors. Officers are elected by the board of directors and serve at the discretion of the board.

Name

Age

Position

Ophir Shahaf

47

Chief Executive Officer and
Director

Shay Ashkenazy

37

Chief Financial Officer

Harold Jacob, M.D.

60

Chief Medical Officer and Director

Jona Zumeris, Ph.D.

63

Vice President of Technology and Director

Ira Greenstein

53

Chairman of the Board of Directors

Michael Ferguson

43

Director Nominee

Thomas R. Mika

62

Director Nominee

William Stern, Ph.D.

72

Director Nominee

Ophir Shahaf, Chief Executive Officer
and Director. Mr. Shahaf has served as our chief executive officer and director since March 1, 2014. Mr. Shahaf served as
chief executive officer of Hadasit Bio-Holdings, which provides its investors with investment exposure to a select portfolio of
biotech companies based on inventions developed and owned by the Hadassah University Hospital, for six years, from 2007 to December
2013. Mr. Shahaf was part of the founding team at Hadasit Bio-Holdings and led the company through its Israeli initial public
offering, subsequent rounds of financing, an ADR listing on the over-the-counter market and a listing on the Tel Aviv Stock Exchange.
Prior to that, Mr. Shahaf served as vice president business development at Protalix Biotherapeutics, which is listed on the NYSE
MKT, and was a founder and vice president of Clal Biotechnology Industries, which is listed on the Tel Aviv Stock Exchange and
is an institutional investor in the life sciences in Israel. Mr. Shahaf received his law degree from Tel Aviv University and his
MBA from the Stern School of Business at New York University, with a major in finance and international business. We believe that
Mr. Shahaf’s qualifications to serve on our board include his background in biotechnology and investment within the field
and his experience serving in management roles of various companies. In addition, as chief executive officer, Mr. Shahaf’s
position on the board ensures a unity of vision between the broader goals of our Company and our day-to-day operations.

Shay Ashkenazy, Chief Financial Officer
. Mr. Ashkenazy has served as our chief financial officer since April 1, 2014. From 2008 through March 2014, Mr. Ashkenazy
served as associate vice president of finance of Gilat Satellite Networks, a Nasdaq- and Tel Aviv Stock Exchange-listed provider
of satellite communications products and services. From 2007 to 2008, he served as director of finance at Superna Systems, which
designs, develops and manufactures products and solutions for the digital home market. Prior to that, from 2003 to 2007, Mr. Ashkenazy
was at PriceWaterhouseCoopers, ultimately as a supervisor specializing in the hi-tech industry, both public and start-up. Mr.
Ashkenazy holds a BA in Accounting and Economy from Tel Aviv University and is a certified public accountant.

Harold Jacob, M.D., Chief Medical Officer
and Director. Dr. Jacob has served as our chief medical officer since March 1, 2014 and as our director since September 2003.
From September 2003 to February 4, 2014, Dr. Jacob served as chairman of our board of directors and from September 2003 to March
1, 2014, Dr. Jacob served as our chief executive officer. Dr. Jacob also performed the functions of a principal financial officer
until April 1, 2014. Dr. Jacob is our co-founder and has worked extensively in medical device development. Dr. Jacob also served
part-time as an attending gastroenterologist at Shaare Zedek Medical Center in Jerusalem, Israel from 2004 to March 2011. Since
April 2011, he has been an attending physician in Gastroenterology at Hadassah University Hospital in Jerusalem, Israel. From
1999 to the present, Dr. Jacob has served as the president of Medical Instrument Development Inc., which provides consulting services
to start-up and early stage companies and patents its own proprietary medical devices. From 1997 to 2003, Dr. Jacob served as
director of medical affairs at Given Imaging Ltd., a company that developed the first swallowable wireless pill camera for inspection
of the intestines. Dr. Jacob also currently serves as a director for Oramed Pharmaceuticals Inc., a pharmaceutical company focused
on the development of innovative orally ingestible capsule medication. We believe that Dr. Jacob’s qualifications to serve
on our board include his years of experience in the biomedical industry and with our Company and his experience serving in management
roles of various companies.

53

Jona Zumeris, Ph.D.,Vice President
of Technology and Director. Dr. Zumeris is our co-founder and has served
as our vice president of technology since September 2003. From 1999 to 2003, Professor Zumeris served as director of research
and development for PMG Medica Ltd., a medical device company focused on ultrasound and piezomechanics technology. Dr. Zumeris
was a founder, president and director of research and development of Nanomotion Ltd., a company that designs and manufactures
motion solutions using ceramic servo motors, drivers and controllers, from 1993 to 1996. Dr. Zumeris’s extensive experience
in the nano-technology and medical fields, especially in leadership and research roles, provide him the appropriate experience
to serve on our board.

Ira Greenstein, Director. Mr. Greenstein
has served as our director since August 2009 and as our board chairman since February 4, 2014. Mr. Greenstein has served as president
of Genie Energy Ltd., an energy and gas holding company, since December 2011. Mr. Greenstein currently also serves as counsel
to the chairman of IDT Corporation, a multinational holding company with operations primarily in the telecommunications industry,
and served as the president of IDT Corporation from 2001 through 2011 and counsel to the chairman of IDT Corporation in 2000 and
2001. Mr. Greenstein serves on the boards of directors of Arista Power, Inc., Document Security Systems, Inc. and Ohr Pharmaceuticals,
Inc. Mr. Greenstein’s experience serving in corporate roles in publicly-traded companies provides him with knowledge that
assists in directing our long-term strategy.

Michael Ferguson, Director Nominee.
Mr. Ferguson has agreed to join our board of directors effective upon the pricing of this offering. In January 2009, Mr. Ferguson
founded Ferguson Strategies, LLC, a government affairs and strategic business consulting firm, where he serves as the chief executive
officer and chairman. From 2001 to January 2009, he served in the U.S. House of Representatives, representing New Jersey’s
7th congressional district. While in Congress, he was a member of the House Energy and Commerce Committee, which has wide jurisdiction
over the healthcare, telecommunications and energy industries. He served as vice chairman of the panel’s Health Subcommittee,
where he became a key member on health care issues and helped to ensure passage of the Medicare Part D prescription drug benefit
in 2003. In addition, he served as a member of the Telecommunications and Internet Subcommittee as well as the Oversight and Investigations
Subcommittee. Mr. Ferguson was also a member of the House Financial Services Committee, where he cosponsored the Sarbanes-Oxley
Act of 2002 and helped enact the initial terrorism risk insurance law. Congressman Ferguson currently serves as a senior fellow
of the Center for Medicine in the Public Interest’s Odyssey Initiative for Biomedical Innovation and Human Health. He has
also served on various corporate advisory boards and committees, including for Pfizer, Inc., the National Italian American Foundation
and the United States Golf Association. Mr. Ferguson received a bachelor’s degree in government from the University of Notre
Dame and a master’s of public policy degree with a specialization in education policy from Georgetown University. Mr. Ferguson
brings to the board his extensive background in government affairs, health care policy, and business strategy gained from his
experiences in Congress and business consulting, which we believe will assist in strengthening and advancing our strategic focus
and regulatory compliance.

Thomas R. Mika, Director Nominee. Mr.
Mika has agreed to join our board of directors effective upon the pricing of this offering. Mr. Mika has over 25 years of senior
management, finance and consulting experience. He has served in various roles at CollabRx, Inc. (formerly known as Tegal Corporation),
a publicly-traded data analytics company focusing on genomics-based medicine, including as its chief executive officer and president
since March 2005 and as chairman of the board since October 2006. From 1992 to 2002, he also served on the company’s board
of directors, which included periods of service as the chairman of the compensation committee and a member of the audit committee,
until he was appointed as its executive vice president and chief financial officer in August 2002. Prior to that, Mr. Mika founded
IMTEC, a boutique investment firm active in the management of several companies in industries such as healthcare, pharmaceuticals,
media and information technology. Mr. Mika was also a director of Metrologix, a semiconductor metrology company, from the time
of its initial start-up until its sale to KLA-Tencor Corp. Prior to forming IMTEC, Mr. Mika was a managing consultant with Cresap,
McCormick & Paget and a policy analyst for the National Science Foundation. He holds a Bachelor of Science degree in microbiology
from the University of Illinois at Urbana-Champaign and a Master of Business Administration degree from the Harvard Graduate School
of Business. Mr. Mika’s qualifications to serve on our board include his significant strategic and business insight from
his prior service on the board of directors of other publicly-held companies, as well as his substantial senior management, finance
and consulting experience.

William Stern, Ph.D.,Director
Nominee.Dr. Stern has agreed to join our board of directors effective
upon the pricing of this offering. Dr. Stern has served as president of Multigon Industries, Inc., which manufactures non-invasive
ultrasound technology that measures blood flow in the brain, since 1984. From 2000 to the present, Dr. Stern has also served as
the vice president of Aqua-Eez, Inc., an affiliate of Multigon Industries, Inc. that manufactures and sells a hydrotherapy pool
for labor and delivery. From 1972 to 1983, he was the president of Unigon Industries, Inc., which manufactured and distributed
diagnostic ultrasound for vascular and neurological diagnostics. Dr. Stern received his Ph.D. in engineering and physics from
Columbia University and holds an M.S. and a B.S. degree in electrical engineering from Columbia University and City College of
New York, respectively. Dr. Stern’s qualifications to serve on our board include his significant scientific background and
over 30 years of executive leadership experience in the field of medical devices and ultrasound technology.

54

There are no family relationships among
any of our directors and executive officers. Our executive officers are party to certain agreements related to their
service as such, described in the “Executive Compensation” section of this prospectus.

Director Independence

Our board of directors has determined that
Michael Ferguson, Ira Greenstein, Thomas R. Mika and William Stern, Ph.D. satisfy the requirements for independence set out in
Section 5605(a)(2) of the Nasdaq Stock Market Rules and that they have no material relationship with us (other than being a director
and/or a stockholder). In making its independence determinations, the board of directors sought to identify and analyze all of
the facts and circumstances relating to any relationship between a director, his immediate family or affiliates and our company
and our affiliates and did not rely on categorical standards other than those contained in the Nasdaq rule referenced above.

Board Committees

Upon the consummation of this offering,
our board of directors will establish an audit committee, a nominating and corporate governance committee and a compensation committee,
each of which will have the composition and responsibilities described below.

Audit Committee. The audit committee
will consist of Messrs. Mika (chair) and Greenstein and Dr. Stern, each of whom our board has determined to be financially literate
and qualify as an independent director under Sections 5605(a)(2) and 5605(c)(2) of the rules of the Nasdaq Stock Market. In addition,
Mr. Mika qualifies as a financial expert, as defined in Item 407(d)(5)(ii) of Regulation S-K. The function of the audit committee
will be to assist the board of directors in its oversight of (1) the integrity of our financial statements, (2) our compliance
with legal and regulatory requirements and (3) the qualifications, independence and performance of our independent auditors.

Nominating and Corporate Governance
Committee. The nominating and corporate governance committee will consist of Messrs. Ferguson (chair) and Greenstein and Dr.
Stern, each of whom our board has determined qualifies as an independent director under Section 5605(a)(2) of the rules of the
Nasdaq Stock Market. The primary function of the nominating and corporate governance committee will be to identify individuals
qualified to become board members, consistent with criteria approved by the board, and select the director nominees for election
at each annual meeting of stockholders.

Compensation Committee. The compensation
committee will consist of Dr. Stern (chair) and Messrs. Greenstein and Mika, each of whom our board has determined qualifies as
an independent director under Sections 5605(a)(2) and 5605(d)(2) of the rules of the Nasdaq Stock Market, as an “outside
director” for purposes of Section 162(m) of the Internal Revenue Code and as a “non-employee director” for purposes
of Section 16b-3 under the Securities Exchange Act of 1934, as amended. The function of the compensation committee will be to
discharge the board of directors’ responsibilities relating to compensation of our directors and executives and our overall
compensation programs. The primary objective of the compensation committee will be to develop and implement compensation policies
and plans that are appropriate for us in light of all relevant circumstances and which provide incentives that further our long-term
strategic plan and are consistent with our culture and the overall goal of enhancing enduring stockholder value.

Board Leadership Structure

The board of directors is committed to
promoting our effective, independent governance. Our board believes it is in our best interests and the best interests of our
stockholders for the board to have the flexibility to select the best director to serve as chairman at any given time, regardless
of whether that director is an independent director or the chief executive officer. Consequently, we do not have a policy governing
whether the roles of chairman of the board and chief executive officer should be separate or combined. This decision is made by
our board of directors, based on our best interests considering the circumstances at the time.

55

Currently, the offices of the chairman
of the board and the chief executive officer are held by two different people. Ira Greenstein is our independent, non-executive
chairman of the board of directors and Ophir Shahaf is our chief executive officer. The chief executive officer will be responsible
for our day-to-day leadership and performance, while the chairman of the board of directors will provide guidance to the chief
executive officer and set the agenda for board meetings and preside over meetings of the board. We believe that separation of
the positions will reinforce the independence of the board in its oversight of our business and affairs, and create an environment
that is more conducive to objective evaluation and oversight of management’s performance, increasing management accountability
and improving the ability of the board to monitor whether management’s actions are in our best interests and those of our
stockholders. Furthermore, we believe that Mr. Greenstein’s history with us will assist the board in its transition to a
new chief executive officer and chief financial officer and with the addition of our three new independent directors.

Role in Risk Oversight

Our board of directors oversees an enterprise-wide
approach to risk management, designed to support the achievement of business objectives, including organizational and strategic
objectives, to improve long-term organizational performance and enhance stockholder value. The involvement of our board of directors
in setting our business strategy is a key part of its assessment of management’s plans for risk management and its determination
of what constitutes an appropriate level of risk for the company. The participation of our board of directors in our risk oversight
process includes receiving regular reports from members of senior management on areas of material risk to our company, including
operational, financial, legal and regulatory, and strategic and reputational risks.

While our board of directors has the ultimate
responsibility for the risk management process, senior management and various committees of our board of directors will also have
responsibility for certain areas of risk management.

Our senior management team is responsible
for day-to-day risk management and regularly reports on risks to our full board of directors or a relevant committee. Our finance
and regulatory personnel serve as the primary monitoring and evaluation function for company-wide policies and procedures, and
manage the day-to-day oversight of the risk management strategy for our ongoing business. This oversight includes identifying,
evaluating, and addressing potential risks that may exist at the enterprise, strategic, financial, operational, compliance and
reporting levels.

The audit committee will focus on monitoring
and discussing our major financial risk exposures and the steps management has taken to monitor and control such exposures, including
our risk assessment and risk management policies. As appropriate, the audit committee will provide reports to and receive direction
from the full board of directors regarding our risk management policies and guidelines, as well as the audit committee’s
risk oversight activities.

In addition, the compensation committee
will assess our compensation policies to confirm that the compensation policies and practices do not encourage unnecessary risk
taking. The compensation committee will review and discuss the relationship between risk management policies and practices, corporate
strategy and senior executive compensation and, when appropriate, report on the findings from the discussions to our board of
directors. Our compensation committee intends to set performance metrics that will create incentives for our senior executives
that encourage an appropriate level of risk-taking that is commensurate with our short-term and long-term strategies.

Code of Ethics

In connection with this offering, our board
of directors will adopt a code of business conduct and ethics that will apply to all of our employees, officers, and directors.
Upon completion of this offering, the full text of our code of business conduct and ethics will be available on our website. Information
on, or accessible through, our website is not part of this prospectus. We expect that any amendments to the code, or any waivers
of its requirements, that apply to directors or executive officers, will be disclosed on our website.

56

EXECUTIVE COMPENSATION

2013 and 2012 Summary Compensation Table

The table below sets forth, for our last
two fiscal years, the compensation earned by our named executive officers, Harold Jacob, M.D., our former chief executive officer
and chairman of the board of directors (now our chief medical officer and a member of our board of directors), and Jona Zumeris,
our vice president of technology and a member of our board of directors. No other executive officer had compensation of greater
than $100,000 for the last three fiscal years.

Name and PrincipalPosition

Year

Salary($)(1)

Bonus($)

OptionAwards($)

All OtherCompensation($)(1)

Total($)(1)

Harold Jacob, M.D.

2013

-

-

182,728

(2)

15,848

(3)

198,576

Former Chief Executive Officer
and

2012

-

-

-

16,442

(3)

16,442

Chairman of the Board of Directors

Jona Zumeris, Ph.D.

2013

52,668

-

187,536

(2)

33,723

(4)

273,927

Vice President of Technology

2012

58,739

36,153

(4)

94,892

and Director

(1)

Compensation amounts received in non-U.S. currency have been converted
into U.S. dollars using the average exchange rate for the applicable year. The average exchange
rate for each of 2013 and 2012 was 3.759 NIS per dollar and 4.014 NIS per dollar, respectively.

(2)

The amounts in this column reflect the dollar amounts
to be recognized for financial statement reporting purposes with respect to the twelve month period ended December 31,
2013 in accordance with FASB ASC Topic 718. Fair value is based on the Black-Scholes option pricing model using the fair
value of the underlying shares at the grant date. For additional discussion of the valuation assumptions used in determining
stock-based compensation and the grant date fair value for stock options, see “Management’s Discussion and
Analysis of Financial Condition and Results of Operation - Critical Accounting Policies - Stock-based compensation”
and Note 2—“Significant Accounting Policies” and Note 11—“Stockholders’ Deficiency”
of the Notes to Consolidated Financial Statements as of December 31, 2013 included in this prospectus.

(3)

Represents car-related benefits for Dr. Jacob.

(4)

Comprised of car-related benefits for Dr. Zumeris of $18,745 in 2013 and $19,665 in 2012 and
other benefits, comprised of contributions towards a pension fund, disability insurance, severance pay, an advanced study
fund and recreation pay, of $14,978in 2013 and $16,488 in 2012.

Compensation of Harold Jacob, M.D.

During 2012 and 2013, Dr. Jacob served
without cash compensation or other benefits, except the use of a car. Effective upon the closing of this offering, Dr. Jacob will
be paid 10,000 NIS per month for his service as chief medical officer.

Agreement with Jona Zumeris, Ph.D.

NanoVibronix Ltd., our wholly-owned Israeli
subsidiary, is party to an employment agreement with Dr. Zumeris, pursuant to which Dr. Zumeris serves as its vice president of
technology. Dr. Zumeris’s salary pursuant to the agreement is 19,500 NIS per month, which was increased to 20,000 NIS per
month by oral agreement commencing in December 2012, and he is entitled to a car, which we lease on his behalf, and contributions
towards a pension fund, disability insurance, severance pay and an advanced study fund and recreation pay, which are customary
or statutorily prescribed in Israel. Dr. Zumeris is also entitled to 15 vacation days. Dr. Zumeris’s employment agreement
contains confidentiality restrictions and other terms and provisions that are customary in Israel. Effective upon the closing
of this offering, Dr. Zumeris’s salary will be increased to 40,000 NIS per month.

57

Agreement with Ophir Shahaf

On February 26, 2014, we entered into an
employment agreement with Ophir Shahaf to serve as our chief executive officer. The term of the agreement begins on March 1, 2014
and continues until terminated. Either party may terminate the agreement for any reason by providing ninety days prior written
notice to the other party. In addition, if we do not consummate our initial public offering by May 31, 2014, Mr. Shahaf will have
until June 30, 2014 to exercise a special right to terminate the employment agreement upon providing only seven days written notice.
During either notice period, Mr.Shahaf is entitled to the payment of his full base salary and all other earned and accrued benefits
and contributions.

Under this employment agreement, Mr. Shahaf
is entitled to a monthly base salary of 60,000 NIS (720,000 NIS per year). During the period beginning on March 1, 2014 and ending
on the closing date of our initial public offering, Mr. Shahaf will only receive 50% of his base salary plus a corresponding portion
of certain contributions and benefits we have agreed to pay/provide. The remaining portion of his salary, contributions and benefits
will be paid on the first pay date immediately following the closing of the offering. Mr. Shahaf is eligible to participate in
a bonus plan, as the board may establish from time to time in its sole discretion, pursuant to which he may receive a bonus in
an amount equal to up to 25% of his annual base salary. Mr. Shahaf is also entitled to a cash bonus equal to $50,000 within five
business days of the closing date of our initial public offering. In addition, on the pricing date of such offering, we will grant
to Mr. Shahaf an option, made pursuant to a separate award agreement and subject to the terms and conditions of our equity plan
then in effect, to purchase such number of shares of our common stock as equal 3% of the shares of common stock issued and outstanding
on the date of grant (taking into account the number of shares that will be sold in the offering) at an exercise price equal to
the public offering price, which will be deemed the fair market value of our common stock on the date of grant. The option will
be granted under section 102 of the Israeli Income Tax Ordinance 5721-1961, for which we will adopt an equity plan or an appendix
to our existing equity plan for Israeli grantees, which will be filed with the Israeli Tax Authorities. The option will vest in
three equal installments, subject to Mr. Shahaf’s continued service with us, with one-third vesting on each of the first,
second and third anniversary of the date of grant. Mr. Shahaf is also entitled to participate in or receive benefits under our
social insurance and benefits plans, including but not limited to manager’s insurance and/or pension fund, disability insurance
and an advanced training fund. These are customary benefits provided to executive employees in Israel. A management insurance
fund is a combination of severance savings (in accordance with Israeli law), defined contribution tax-qualified pension savings
and disability insurance premiums. An advanced training fund is a savings fund of pre-tax contributions to be used after a specified
period of time for educational or other permitted purposes. We will pay certain percentages of Mr. Shahaf’s base salary
towards these insurance and benefits plans, including 7.5% to the advanced training fund plus either (a) 14.33% to the pension
fund, of which 8.33% will be paid to severance compensation and 6% to the pension savings component or (b) 13.33% to manager’s
insurance, of which 8.33% will be paid to severance compensation, 5% to the pension savings component and the lower of the amount
required to secure at least 75% of his base salary or up to 2.5% to disability insurance. Mr. Shahaf is entitled to choose whether
our contributions are made in accordance with (a), (b) or any combination of these options; provided that such contributions are
calculated based on an amount that does not exceed his base salary.

On March 2, 2014, we entered into an employment
agreement with Shay Ashkenazy to serve as our chief financial officer. The term of the agreement began on April 1, 2014 and continues
until terminated. Either party may terminate the agreement for any reason by providing sixty days prior written notice to the
other party. In the event that we provide notice of termination, Mr. Ashkenazy is entitled to payment of his full base salary
and all other earned and accrued benefits during such notice period.

Under this employment agreement, Mr. Ashkenazy
is entitled to a monthly base salary of 40,000 NIS (480,000 NIS per year). Mr. Ashkenazy is eligible to participate in a bonus
plan, as the board may establish from time to time in its sole discretion. Mr. Ashkenazy is also entitled to receive a cash bonus
equal to $10,000 within five business days of the closing date of our initial public offering, provided that he is still employed
by us on such closing date. In addition, on the pricing date of such offering, we will grant to Mr. Ashkenazy an option, made
pursuant to a separate award agreement and subject to the terms and conditions of our equity plan then in effect, to purchase
such number of shares of our common stock as equal 1% of the shares of common stock issued and outstanding on the date of grant
(taking into account the number of shares that will be sold in the offering) at an exercise price equal to the public offering
price, which will be deemed the fair market value of our common stock on the date of grant. The option will be granted under section
102 of the Israeli Income Tax Ordinance 5721-1961. The option will vest in three equal installments, subject to Mr. Ashkenazy’s
continued service with us, with one-third vesting on each of the first, second and third anniversary of the date of grant. If
within three months following a change of control (as such term is defined in our equity plan pursuant to which we will grant
the option) we terminate Mr. Ashkenazy’s employment without “cause” (as such term is defined in Mr. Ashkenazy’s
employment agreement), the option will become 100% vested and exercisable on the date of termination. Mr. Ashkenazy is also entitled
to participate in or receive benefits under our social insurance and benefits plans, including but not limited to manager’s
insurance, disability insurance and an advanced training fund. We will pay certain percentages of Mr. Ashkenazy’s base salary
towards these insurance and benefits plans, including 7.5% to the advanced training fund and 13.33% to manager’s insurance,
of which 8.33% will be paid to severance compensation, 5% to the pension savings component, and the lesser of the amount required
to secure at least 75% of his base salary or up to 2.5% to disability insurance.

The following table provides information
on the holdings of stock options of the named executive officer at December 31, 2013. This table includes unexercised and unvested
options awards. Each outstanding award is shown separately.

58

Option Awards

Number of

Number of

Securities

Securities

Underlying

Underlying

Option

Unexercised

Unexercised

Exercise

Option

Date of

Options (#)

Options
(#)

Price

Expiration

Name

Grant

Exercisable

Unexercisable

($)

Date

Harold Jacob, M.D.

December 31, 2004

8,571

-

0.07

December 31, 2014

December 13, 2007

4,286

-

72.45

December 13, 2017

December 9, 2010

10,714

(1)

-

1.19

December 9, 2020

March 28, 2013

108,571

-

0.07

March 28, 2023

Jona Zumeris, Ph.D.

March 28, 2013

111,429

-

0.07

March 28, 2023

(1)

Granted as compensation for services as an executive officer in light of his below market
salary.

2004 Global Share Option Plan

In November 2004, our board of directors
adopted the 2004 Global Share Option Plan, pursuant to which 400,000 shares of our common stock are reserved for issuance as awards
to employees, directors, consultants and other service providers. The purpose of the 2004 Global Share Option Plan is to provide
an incentive to attract and retain directors, officers, consultants, advisors and employees, to encourage a sense of proprietorship
and stimulate an active interest of such persons in our development and financial success. The 2004 Global Share Option Plan is
administered by our board of directors.

On March 28, 2013, we granted options under
the 2004 Global Share Option Plan to the following executive officers and directors. The options all vested immediately.

Number of Securities

Option

Option

Underlying
Unexercised Options (#)

Exercise

Expiration

Name

Exercisable

Price ($)

Date

Harold Jacob, M.D.

108,571

0.07

March 28, 2023

Jona Zumeris, Ph.D

111,429

0.07

March 28, 2023

Paul Packer(1)

30,000

1.96

March 28, 2023

(1)Mr. Packer resigned as a member of our board of directors, effective as of January 15, 2014.

NanoVibronix, Inc. 2014 Long-Term Incentive Plan

On February 28, 2014, our stockholders
approved the NanoVibronix, Inc. 2014 Long-Term Incentive Plan, which was adopted by our board of directors on February 19, 2014.
The NanoVibronix, Inc. 2014 Long-Term Incentive Plan provides for the granting of incentive stock options, nonqualified stock
options, stock appreciation rights, restricted stock, restricted stock units, performance awards, dividend equivalent rights,
and other awards, which may be granted singly, in combination, or in tandem, and which may be paid in cash, shares of our common
stock, or a combination of cash and shares of our common stock. We have reserved a total of 714,286 shares of our common stock
for awards under the NanoVibronix, Inc. 2014 Long-Term Incentive Plan, 100% of which may be delivered pursuant to incentive stock
options.

The purpose of the NanoVibronix, Inc. 2014
Long-Term Incentive Plan is to provide an incentive to attract and retain services of key employees, key contractors, and outside
directors whose services are considered valuable, to encourage a sense of proprietorship and to stimulate active interest of such
persons in our development and financial success. The NanoVibronix, Inc. 2014 Long-Term Incentive Plan is intended to serve as
an “umbrella” plan for us and our subsidiaries worldwide. Therefore, if so required, appendices may be added to the
NanoVibronix, Inc. 2014 Long-Term Incentive Plan in order to accommodate local regulations in foreign countries that do not correspond
to the scope of the NanoVibronix, Inc. 2014 Long-Term Incentive Plan. Unless terminated earlier by the board of directors, the
NanoVibronix, Inc. 2014 Long-Term Incentive Plan will expire on February 19, 2024.

59

Director Compensation

We paid no compensation to our non-employee
directors for the one year period ended December 31, 2013 and have paid no compensation during 2014 to date, other than the awards
described below. The following table shows information concerning the compensation of our directors, other than Dr. Jacob and
Dr. Zumeris, during the twelve months ended December 31, 2013.

Name

Fees Earned or Paid
in Cash ($)

Option Awards ($)(1)

All Other Compensation
($)

Total ($)(1)

Sim Fass(2)

-

-

-

-

Ira Greenstein

-

-

-

-

Paul Packer(3)

-

22,761

(4)

-

22,761

(1)

The amounts in this column reflect
the dollar amounts to be recognized for financial statement reporting purposes with respect
to the twelve month period ended December 31, 2013 in accordance with FASB ASC Topic
718. Fair value is based on the Black-Scholes option pricing model using the fair value
of the underlying shares at the grant date. For additional discussion of the valuation
assumptions used in determining stock-based compensation and the grant date fair value
for stock options, see “Management’s Discussion and Analysis of Financial
Condition and Results of Operation — Critical Accounting Policies — Stock-based
compensation” and Note 2—“Significant Accounting Policies” and
Note 11—“Stockholders’ Deficiency” of the Notes to Consolidated
Financial Statements as of December 31, 2013 included in this prospectus.

(2)

Mr. Fass resigned as a member of our board of directors,
effective as of January 29, 2014.

(3)

Mr. Packer resigned as a member of our board of directors,
effective as of January 15, 2014.

(4)

See “—2004 Global Share Option Plan”
above for more information on this award.

CERTAIN RELATIONSHIPS
AND RELATED TRANSACTIONS

Generally, we do not to enter into related
party transactions unless the members of the board who do not have an interest in the potential transaction have reviewed the
transaction and determined that (i) we would not be able to obtain better terms by engaging in a transaction with a non-related
party and (ii) the transaction is in our best interest. This policy applies generally to any transaction in which we are
to be a participant and the amount involved exceeds the lesser of $120,000 or one percent of the average of our total assets at
year end for the previous two completed fiscal years, and in which any related person had or will have a direct or indirect material
interest. This policy is not currently in writing. In addition, our audit committee will be required to pre-approve
any related party transactions pursuant to its charter.

On March 20, 2009, we issued 8,696 shares
of series B participating convertible preferred stock and warrants to purchase 8,696 shares of series B participating convertible
preferred stock to Paul Packer, who was then a member of our board of directors and who remained a director until January 15,
2014, in exchange for consideration of $150,000. On January 1, 2010, we issued 2,899 shares of series B participating convertible
preferred stock and warrants to purchase 2,899 shares of series B participating convertible preferred stock to a fund controlled
by Mr. Packer, in exchange for consideration of $50,000. On July 12, 2011, we issued 5,797 shares of series B participating convertible
preferred stock and warrants to purchase 5,797 shares of series B participating convertible preferred stock to a fund controlled
by Mr. Packer, in exchange for consideration of $100,000. The warrants had an exercise price of $17.25 per share and a five-year
term. The series B participating convertible preferred stock was convertible into shares of our common stock at a rate of one
common share for every seven series B participating convertible preferred shares.

60

On November 22, 2011,
we issued convertible series B-1 promissory notes to certain investors. These investors include three funds controlled by Mr.
Packer. The notes purchased by these funds were in the original aggregate principal amount of $180,000. Dr. Jacob, our former
chief executive officer and chairman (now our chief medical officer and a member of our board of directors), also participated
in the offering. As compensation for his service from May through December of 2011, Dr. Jacob received notes in the original aggregate
principal amount of $25,000. In addition, CollabRx, Inc., which beneficially owns greater than 5% of our common stock, purchased
convertible series B-1 promissory notes in the original aggregate principal amount of $300,000. The convertible series B-1 promissory
notes mature on the earlier of November 15, 2014 or on an accelerated date if there is an event of default, upon which date the
entire outstanding principal balance and any outstanding fees or interest will be due and payable in full. The convertible series
B-1 promissory notes bear interest at the rate of 10% per annum, compounded annually. In addition, the convertible series B-1
promissory notes are convertible at any time at the holder’s option into shares of our series B-1 participating convertible
preferred stock at an initial conversion price of $0.284 per share, subject to adjustment for stock dividends, stock splits or
combinations. Our series B-1 participating convertible preferred stock is convertible into shares of our common stock at a rate
of one common share for every seven series B-1 participating convertible preferred shares. The convertible series B-1 promissory
notes will automatically convert into series B-1 participating convertible preferred stock upon the occurrence of (i) an aggregate
investment in us of $3 million or more in a transaction or series of transactions, (ii) our initial public offering of our common
stock pursuant to an effective registration statement under the United States Securities Act of 1933, as amended, or equivalent
law of another jurisdiction, or upon such date as we become subject to the reporting requirements of Section 13(a) or 15(d) of
the Securities Exchange Act of 1934, as amended, including, without limitation, upon consummation of a reverse merger or upon
the effectiveness of a registration statement on Form 10 filed by us under the Securities Exchange Act of 1934, as amended, or
equivalent document or (iii) a fundamental transaction. To date, no principal or interest has been paid on these notes. As of
April 28, 2014, an aggregate of $46,915 in interest has accrued on the notes held by the entities controlled by Mr. Packer, an
aggregate of $6,516 has accrued on the notes held by Dr. Jacob and an aggregate of $78,191 has accrued on the notes held by CollabRx,
Inc. By their initial terms, these notes, including accrued interest thereon, will convert into shares of series B-1 participating
convertible preferred stock, which will then convert into common stock, automatically upon the effectiveness of this registration
statement. However, we have entered into an amendment agreement with the entities controlled by Mr. Packer pursuant to which their
series B-1 promissory notes are convertible into the same number of shares of series C preferred stock as the holder would have
received in common stock absent such amendment. Each share of our series C preferred stock is convertible into one share of our
common stock (subject to adjustment as provided in the related certificate of designation of preferences) at any time at the option
of the holder, provided that the holder would be prohibited from converting series C preferred stock into shares of our common
stock if, as a result of such conversion, the holder, together with its affiliates, would own more than 9.99% of the total number
of shares of our common stock then issued and outstanding. This limitation may be waived upon not less than 61 days’ prior
written notice to us. For more information regarding the series C preferred stock, see “Description of Securities —
Preferred Stock — Series C Convertible Preferred Stock.”

On November 22, 2011,
we issued convertible series B-2 promissory notes in the original aggregate principal amount of $340,329 and warrants to purchase
513,575 shares of series B-2 participating convertible preferred stock to Mr. Packer and the two funds described above in exchange
for the cancellation of the preferred stock and warrants described above. The principal amount of the notes was equal to the original
investment in the series B participating convertible preferred stock plus simple interest at 8% from the date of the original
investment. The number of shares underlying the warrants was equal to Mr. Packer’s and the two funds’ proportionate
share of 30 percent of the number of shares into which the convertible series B-1 promissory notes were convertible. The terms
of the convertible series B-2 promissory notes are the same as those of the convertible series B-1 promissory notes, except that
the initial conversion price is $0.199 per share of series B-2 participating convertible preferred stock. Our series B-2 participating
convertible preferred stock is convertible into shares of our common stock at a rate of one common share for every seven series
B-2 participating convertible preferred shares. To date, no principal or interest has been paid on these notes. As of April 28,
2014, an aggregate of $91,174 in interest has accrued on the notes. By their initial terms, these notes, including accrued interest
thereon, will convert into shares of series B-2 participating convertible preferred stock, which will then convert into common
stock, automatically upon the effectiveness of this registration statement. However, we have entered into an amendment agreement
with the entities controlled by Mr. Packer pursuant to which their series B-2 promissory notes are convertible into the same number
of shares of series C preferred stock as the holder would have received in common stock absent such amendment. The warrants had
an exercise price of $0.199 per share of series B-2 participating convertible preferred stock and a seven-year term. Upon the
effectiveness of this registration statement, the warrants will be automatically exchanged for warrants to purchase 73,368 shares
of common stock at an exercise price of $1.393 per share. For a description of these new warrants, see “Description of Securities—Warrants—
2014 Warrants.” We have amended and restated the warrants to purchase
series B-2 participating convertible preferred stock currently held by Mr. Packer and the entities controlled by Mr. Packer to
include, and we anticipate that we will include in the warrants issued to Mr. Packer and the entities controlled by Mr. Packer
upon the effectiveness of this registration statement, provisions that block exercise if such exercise will result in the holder
having beneficial ownership of more than 9.99% of our common stock. This limitation may be waived upon not less than 61
days’ prior written notice to us, and will expire the day before the applicable warrant expires.

On February 5, 2013, March 28, 2013, June
3, 2013, August 5, 2013, October 7, 2013, December 9, 2013, February 6, 2014 and April 1, 2014, we issued secured convertible
promissory notes to two funds controlled by Mr. Packer. The notes were initially issued in the original aggregate principal amount
of $100,000. On each date listed above, such principal amount was increased by $100,000. The seventh amended and restated secured
convertible promissory notes issued on April 1, 2014 have an original aggregate principal amount of $800,000. The convertible
promissory notes mature on the earlier of June 30, 2014, the closing date of a financing in which we sell an aggregate of at least
$250,000 of our debt or equity securities or on an accelerated date if there is an event of default, upon which date the entire
outstanding principal balance and any outstanding fees or interest will be due and payable in full. The convertible promissory
notes bear interest at the rate of 6% per annum, which rate is increased to 10% upon and during the occurrence of an event of
default. In addition, as amended, the convertible promissory notes are convertible either at the holders’ option or upon
maturity into shares of our series C preferred stock at a current conversion price of $2.66 per share, subject to adjustment for
stock splits, fundamental transactions or similar events. The holders of the convertible promissory notes have a security interest
in all of our assets and those of our subsidiaries. To date, no principal or interest has been paid on these notes. As of April
28, 2014, an aggregate of $31,052 in interest has accrued on the notes.

In connection with the issuance of the
notes described above, on each of February 5, 2013, March 28, 2013, June 3, 2013, August 5, 2013, October 7, 2013, December 9,
2013, February 6, 2014 and April 1, 2014, we issued warrants to purchase up to an aggregate of 37,594 shares of common stock,
with an exercise price of $2.66 per share, subject to adjustment, to the two funds controlled by Mr. Packer. We have amended and
restated these warrants to include provisions that block exercise if such exercise will result in the holder having beneficial
ownership of more than 9.99% of our common stock. This limitation may be waived upon not less than 61 days’ prior written
notice to us, and will expire the day before the applicable warrant expires.

On February 25, 2014, we entered into a
consulting agreement with AYTA Consulting, LLC, an entity controlled by Mr. Packer, pursuant to which AYTA Consulting, LLC agreed
to provide certain financial and strategic advisory and consulting services to us in exchange for a restricted stock award grant
of 57,143 shares of our common stock, subject to the terms and conditions of a separate restricted stock award agreement, as the
sole compensation for its performance of the consulting services. The agreement will terminate upon (a) our initial public offering,
(b) our becoming subject to the reporting requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended,
(c) our merger, share exchange or consolidation (other than one in which our stockholders own a majority of the voting power of
the outstanding shares of the surviving or acquiring corporation) or a sale, lease, transfer, exclusive license or other disposition
of all or substantially all of our assets, (d) written termination of the agreement by AYTA Consulting, LLC with 30 days written
notice, or (e) our liquidation, dissolution or winding up. The 57,143shares of restricted stock were granted to AYTA Consulting,
LLC on February 25, 2014 pursuant to a restricted stock award agreement and will fully vest upon the occurrence of any of the
events listed in (a), (b) or (c) above. The shares of restricted stock are subject to forfeiture until vested and will be forfeited
if such shares have not vested on the later of December 31, 2019 or the date of AYTA Consulting, LLC’s termination of service
with us.

61

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT

The following table sets forth information
with respect to the beneficial ownership of our common stock as of April 28, 2014 by:

·

each person known by us to beneficially own more than 5.0% of
our common stock;

·

each of our directors;

·

each of the named executive officers; and

·

all of our directors and executive officers as a group

The percentages of common stock beneficially
owned are reported on the basis of regulations of the Securities and Exchange Commission governing the determination of beneficial
ownership of securities. Under the rules of the Securities and Exchange Commission, a person is deemed to be a beneficial owner
of a security if that person has or shares voting power, which includes the power to vote or to direct the voting of the security,
or investment power, which includes the power to dispose of or to direct the disposition of the security. Except as indicated
in the footnotes to this table, each beneficial owner named in the table below has sole voting and sole investment power with
respect to all shares beneficially owned and each person’s address is c/o NanoVibronix, Inc., 105 Maxess Road, Suite S124,
Melville, NY 11747. As of April 28, 2014, we had 2,217,564 shares outstanding.

In addition to the shares of common stock
reported below, Mr. Packer will beneficially own 100% of our issuable series C preferred stock. For more information regarding
the series C preferred stock, see “Description of Securities – Preferred Stock – Series C Convertible Preferred
Stock.”

Name of Beneficial Owner

Number of Shares
Beneficially Owned (1)

Percentage Beneficially
Owned Prior to Offering (1)

Percentage Beneficially
Owned After the Offering(1)

5% Owners

CollabRx, Inc.(2)

190,237

(3)

8.6

%

5.4

%

IDT Corporation(4)

178,785

(5)

7.9

%

5.0

%

Paul Packer(6)

273,857

(7)

12.3

%

9.99

%

Miriam Winder-Kelly(8)

246,944

(9)

10.9

%

6.9

%

Officers and Directors

Ophir Shahaf

-

-

(10

)

Shay Ashkenazy

-

-

(11

)

Harold Jacob, M.D.

220,460

(12)

9.3

%

6.0

%

Jona Zumeris, Ph.D.

180,308

(13)

7.7

%

4.9

%

Ira Greenstein

68,479

(14)

3.1

%

1.9

%

Michael Ferguson

-

Thomas R. Mika

-

William Stern, Ph.D.

-

All current directors and executive officers as a group (5 persons)

469,246

18.9

%

12.3

%

*
Less than one percent (1%).

(1)

Shares of common stock beneficially owned and the respective percentages of beneficial ownership
of common stock assume the exercise of all options, warrants and other securities convertible into common stock beneficially
owned by such person or entity currently exercisable or exercisable within 60 days of April 28, 2014. Shares issuable
pursuant to the exercise of stock options and warrants exercisable within 60 days are deemed outstanding and held by the
holder of such options or warrants for computing the percentage of outstanding common stock beneficially owned by such
person, but are not deemed outstanding for computing the percentage of outstanding common stock beneficially owned by
any other person. In addition, shares of common stock beneficially owned and the respective percentages of beneficial
ownership of common stock assume all of the adjustments described on page 5 under “Prospectus Summary – The
Offering.” All conversions are deemed to have occurred on April 28, 2014.

Comprised of (i) 144,549 shares of common stock to be issued upon the conversion of convertible
series B-2 promissory notes and (ii) 34,236 shares of common stock that may be purchased upon the exercise of warrants.

Comprised of (i) 2,465 shares of common stock held by Globis
Capital Partners, L.P., (ii) 115,301 shares of common stock to be issued upon the conversion of preferred stock held by Globis
Capital Partners, L.P., (iii) 954 shares of common stock held by Globis Overseas Fund, Ltd., (iv) 44,631 shares of common stock
to be issued upon the conversion of preferred stock held by Globis Overseas Fund, Ltd., (v) 477 shares of common stock held by
Mr. Packer, (vi) 22,315 shares to be issued upon the conversion of preferred stock held by Mr. Packer, (vii) 30,571 shares of
common stock that may be purchased upon the exercise of stock options held by Mr. Packer and (viii) 57,143 shares of restricted
stock held by AYTA Consulting, LLC.

Does not include the following, which Mr. Packer also beneficially
owns: (i) 50,730 shares of series C preferred stock to be issued upon the conversion of convertible series B-1 promissory notes
held by Globis Capital Partners, L.P., (ii) 93,194 shares of series C preferred stock to be issued upon the conversion of convertible
series B-2 promissory notes held by Globis Capital Partners, L.P., (iii) 249,940 shares of series C preferred stock to be issued
upon the conversion of secured convertible promissory notes held by Globis Capital Partners, L.P., (iv) 15,853 shares of series
C preferred stock to be issued upon the conversion of convertible series B-1 promissory notes held by Globis Overseas Fund, Ltd.,
(v) 51,884 shares of series C preferred stock to be issued upon the conversion of convertible series B-2 promissory notes held
by Globis Overseas Fund, Ltd., (vi) 62,485 shares of series C preferred stock to be issued upon the conversion of secured convertible
promissory notes held by Globis Overseas Fund, Ltd., (vii) 47,559 shares of series C preferred stock to be issued upon the conversion
of convertible series B-1 promissory notes held by Globis International Investments L.L.C. and (viii) 164,688 shares of series
C preferred stock to be issued upon the conversion of convertible series B-2 promissory notes held by Mr. Packer. These shares
of series C preferred stock are excluded, even though the terms of the series C preferred stock allow for conversion into common
stock and voting on an as if converted basis with the common stock, because these rights are prohibited if their exercise will
result in the holder having beneficial ownership of more than 9.99% of our common stock.

Does not include the following: (i) 262,674 shares of common
stock that may be purchased by Globis Capital Partners, L.P. upon the exercise of warrants, (ii) 72,439 shares of common stock
that may be purchased by Globis Overseas Fund, Ltd. upon the exercise of warrants, (iii) 39,006 shares of common stock that may
be purchased by Mr. Packer upon the exercise of warrants. These shares of common stock are excluded because the warrants contain
provisions that block exercise if such exercise will result in the holder having beneficial ownership of more than 9.99% of our
common stock. Upon completion of the offering, 91,614 shares of common stock that may be purchased upon exercise of these warrants
would also be deemed to be beneficially owned by Mr. Packer because these shares could be acquired without the holder having beneficial
ownership of more than 9.99% of our common stock.

Mr. Packer is the managing member of Globis Capital Advisors, L.L.C., which is the general partner of
Globis Capital Partners, L.P. Mr. Packer is the managing member of Globis Capital, L.L.C., which is the general partner of Globis
Capital Management, L.P., which is the investment manager of Globis Overseas Fund, Ltd. Mr. Packer is also the managing member
of Globis International Investments L.L.C. Mr. Packer is deemed to have beneficial ownership of the shares held by Globis Capital
Partners, L.P., Globis Overseas Fund, Ltd. and Globis International Investments L.L.C. Mr. Packer also controls, and is deemed
to have beneficial ownership of the shares held by, AYTA Consulting, LLC.

Comprised of (i) 828 shares of common stock to be issued upon the conversion of preferred
stock, (ii) 198,986 shares of common stock to be issued upon the conversion of convertible series B-2 promissory notes
and (iii) 47,130 shares of common stock that may be purchased upon the exercise of warrants.

(10)

On the pricing date of this offering, we will grant to Mr. Shahaf an option to purchase such
number of shares of our common stock as equal 3% of the shares of common stock and series C preferred stock issued and outstanding
on the date of grant (taking into account the number of shares that will be sold in the offering). For more information on
this grant, see “Executive Compensation — Agreement with Ophir Shahaf.”

(11)

On the pricing date of this offering, we will grant to Mr. Ashkenazy an option to purchase
such number of shares of our common stock as equal 1% of the shares of common stock and series C preferred stock issued and
outstanding on the date of grant (taking into account the number of shares that will be sold in the offering). For more information
on this grant, see “Executive Compensation — Agreement with Shay Ashkenazy.”

(12)

Comprised of (i) 7,909 shares of common stock held by Medical Instrument Development Inc.,
an entity controlled by Dr. Jacob, (ii) 52,193 shares of common stock to be issued upon the conversion of convertible series
B-2 promissory notes held by Medical Instrument Development Inc., (iii) 12,362 shares of common stock that may be purchased
by Medical Instrument Development Inc. upon the exercise of warrants, (iv) 15,853 shares of common stock to be issued upon
the conversion of convertible series B-1 promissory notes held by Dr. Jacob and (v) 132,143 shares of common stock that may
be purchased by Dr. Jacob upon the exercise of stock options.

(13)

Comprised of (i) 68,879 shares of common stock held by Piezo Top Ltd, an entity controlled
by Dr. Zumeris, and (ii) options to purchase 111,429 shares of common stock held by Dr. Zumeris.

(14)

Comprised of (i) 54,846 shares of common stock to be issued upon the conversion of convertible
series B-2 promissory notes, (ii) 12,990 shares of common stock that may be purchased upon the exercise of warrants and (iii)
643 shares of common stock that may be purchased upon the exercise of stock options.

64

DESCRIPTION OF SECURITIES

Upon the completion of this offering, our
restated certificate of incorporation will authorize us to issue up to 20,000,000 shares of common stock, $0.001 par value per
share, and 5,000,000 shares of preferred stock, $0.001 par value per share, of which 1,000,000 shares of preferred stock
will be designated series C preferred stock and 4,000,000 shares of preferred stock will be undesignated. Our board of directors
may establish the rights and preferences of the undesignated preferred stock from time to time. The anticipated terms of the series
C preferred stock are described below. As of April 28, 2014, there were 2,217,564 shares of common stock outstanding, held of
record by approximately 130 stockholders.

Common Stock

The holders of common stock are entitled
to one vote per share. Our certificate of incorporation does not provide for cumulative voting. 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.

Units

Each unit offered consists of one share
of our common stock and one warrant to purchase one share of our common stock. We anticipate that the units will begin trading
on , 2014, the date of this prospectus. The units will automatically separate 45
days after the date of this prospectus, and each of the shares of common stock and warrants will trade separately, unless Chardan
Capital Markets LLC, as representative of the underwriters, determines that an earlier date is acceptable based on its assessment
of the relative strengths of the securities markets and small capitalization companies in general, and the trading pattern of,
and demand for, our securities in particular. If Chardan Capital Markets permits separate trading of the common stock and warrants
prior to ,
we will issue a press release and file a Current Report on Form 8-K with the Securities and Exchange Commission announcing when
such separate trading will begin.

Warrants Issued as Part of the Units

Each warrant entitles the holder to
purchase one share of our common stock at an initial exercise price of $ (which is equal to 125%
of the offering price of the units). Each warrant will become exercisable 45 days after the date of this prospectus and will expire
on , 2019. Warrants will not be rounded up to the next whole warrant
and will only be exercisable for full shares of common stock.

The warrants will be represented issued
in registered form, in each case pursuant to a warrant agreement between VStock Transfer, LLC, as warrant agent, and us.

The exercise price and number of shares
issuable upon exercise of the warrants may be adjusted upon the occurrence of certain events, including but not limited to any
stock split, stock dividend, recapitalization, reorganization, merger or consolidation. However, warrants will not be adjusted
for issuances of common stock or securities convertible or exercisable into common stock at a price below the then current exercise
price of the warrants.

The number of shares of common stock that
may be acquired by any holder upon any exercise of the warrants will be limited to the extent necessary to insure that, following
such exercise (or other issuance), the total number of shares of common stock then beneficially owned by such holder and its affiliates
and any other persons whose beneficial ownership of common stock would be aggregated with the holder’s for purposes of Section
13(d) of the Securities Exchange Act of 1934, as amended, does not exceed 9.99% of the total number of issued and outstanding shares
of common stock (including for such purpose the shares of common stock issuable upon such exercise), which we refer to as the beneficial
ownership limitation. A holder may elect to increase this beneficial ownership limitation from 9.99% to any other percentage of
the total number of issued and outstanding shares of common stock (including for such purpose the shares of common stock issuable
upon such exercise) upon providing us with not less than 61 days’ prior written notice and any such increase will apply only
to such holder.

The warrants may be exercised, at the
option of each holder, in whole or in part, upon surrender of the warrant certificate on or prior to the expiration date at the
offices of the warrant agent, with the exercise form on the reverse side of the warrant certificate completed and executed as
indicated, accompanied by full payment of the exercise price for the number of shares of our common stock purchased upon such
exercise, by certified check payable to us or by wire transfer of immediately available funds to an account designated by us.
Subject to applicable laws, the warrants may be transferred at the option of the holders upon surrender of the warrants to us
together with the appropriate instruments of transfer.

65

The warrant holders do not have the
rights or privileges of holders of common stock and any voting rights until they exercise their warrants and receive shares of
common stock. After the issuance of shares of common stock upon exercise of the warrants, each holder will be entitled to one
vote for each share of common stock held of record on all matters to be voted on by stockholders.

No warrants will be exercisable unless
at the time of exercise a prospectus relating to common stock issuable upon exercise of the warrants is current and the common
stock has been registered or qualified or deemed to be exempt under the securities laws of the state of residence of the holder
of the warrants. Under the terms of the warrant agreement, we have agreed to meet these conditions and use our best efforts to
maintain a current prospectus relating to common stock issuable upon exercise of the warrants until the expiration of the warrants.
However, we cannot assure you that we will be able to do so, and if we do not maintain a current prospectus related to the common
stock issuable upon exercise of the warrants, holders will be unable to exercise their warrants and we will not be required to
settle any such warrant exercise. If the prospectus relating to the common stock issuable upon the exercise of the warrants is
not current or if the common stock is not qualified or exempt from qualification in the jurisdictions in which the holders of
the warrants reside, we will not be required to net cash settle or cash settle the warrant exercise, the warrants may have no
value, the market for the warrants may be limited and the warrants may expire worthless.

The exercise price, expiration date
and all other warrant terms may be changed without the consent of investors if we, together with 65% of the warrant holders, consent
to such change.

Preferred Stock

All 222,620 currently outstanding shares
of series A-1 preferred stock will be converted automatically to common stock at a conversion rate of 1.6707 shares of common
stock per share of series A-1 preferred stock upon the effectiveness of this registration statement. This conversion rate reflects
an antidilution adjustment made in connection with our November 2011 promissory note issuances. All 171,612 currently outstanding
shares of series A-2 preferred stock will be converted automatically to common stock at a conversion rate of one share of common
stock for every seven shares of series A-2 preferred stock upon the effectiveness of this registration statement. The owners of
a majority of the outstanding shares of series A-1 and series A-2 preferred stock voting as a single class may cause all shares
of series A preferred stock to be converted into shares of common stock. Following the completion of this offering, our board
of directors will have the authority, without further action by our stockholders, to issue up to 4,000,000 shares of preferred
stock in one or more series, to establish from time to time the number of shares to be included in each such series, to fix the
rights, preferences and privileges of the shares of each wholly unissued series and any qualifications, limitations or restrictions
thereon, and to increase or decrease the number of shares of any such series, but not below the number of shares of such series
then outstanding.

Our board of directors may authorize the
issuance of preferred stock with voting or conversion rights that could adversely affect the voting power or other rights of the
holders of our common stock. The purpose of authorizing our board of directors to issue preferred stock and determine its rights
and preferences is to eliminate delays associated with a stockholder vote on specific issuances. The issuance of preferred stock,
while providing flexibility in connection with possible acquisitions and other corporate purposes, could, among other things,
have the effect of delaying, deferring or preventing a change in control of us and may adversely affect the market price of our
common stock and the voting and other rights of the holders of our common stock. It is not possible to state the actual effect
of the issuance of any shares of preferred stock on the rights of holders of common stock until the board of directors determines
the specific rights attached to that preferred stock.

Series C Convertible Preferred Stock

The series C preferred stock ranks as follows:

•

senior
to all of our common stock;

•

senior
to any class or series of our capital stock hereafter created specifically ranking by
its terms junior to the preferred stock;

•

on parity
with any class or series of our capital stock hereafter created specifically ranking
by its terms on parity with the preferred stock; and

•

junior
to any class or series of our capital stock hereafter created specifically ranking by
its terms senior to the series C preferred stock;

in each case, as to distributions of assets upon our liquidation,
dissolution or winding up whether voluntarily or involuntarily.

Each share of our series C preferred stock
is convertible into one share of our common stock (subject to adjustment as provided in the related certificate of designation
of preferences) at any time at the option of the holders, provided that each holder would be prohibited from converting series
C preferred stock into shares of our common stock if, as a result of such conversion, any such holder, together with its affiliates,
would own more than 9.99% of the total number of shares of our common stock then issued and outstanding. This limitation may be
waived with respect to a holder upon such holder’s provision of not less than 61 days’ prior written notice to us.

In the event of our liquidation, dissolution,
or winding up, each holder of our series C preferred stock could elect to receive either (i) in preference to any payments made
to the holders of our common stock and any other junior securities, a payment for each share of series C preferred stock then
held equal $0.001, plus an additional amount equal to any dividends declared but unpaid on such shares, and any other fees or
liquidated damages then due and owing thereon or (ii) the amount of cash, securities or other property to which such holder would
be entitled to receive with respect to each share of series C preferred stock if such share of series C preferred stock had been
converted to common stock immediately prior to such liquidation, dissolution, or winding up (without giving effect to any conversion
limitations).

Shares of series C preferred stock are
not entitled to receive any dividends, unless and until specifically declared by our board of directors. However, holders of our
series C preferred stock are entitled to receive dividends on shares of series C preferred stock equal (on an as-if-converted-to-common-stock
basis) to and in the same form as dividends actually paid on shares of the common stock when such dividends are specifically declared
by our board of directors. We are not obligated to redeem or repurchase any shares of preferred stock. Shares of series C preferred
stock are not otherwise entitled to any redemption rights, or mandatory sinking fund or analogous fund provisions.

66

Each holder of series C preferred stock
is entitled to the number of votes equal to the number of whole shares of common stock into which the shares of series C preferred
stock held by such holder are then convertible (subject to the beneficial ownership limitations set forth in the related certificate
of designation of preferences) with respect to any and all matters presented to the stockholders for their action or consideration.
Holders of series C preferred stock vote together with the holders of common stock as a single class, except as provided by law
and except that the consent of holders of a majority of the outstanding series C preferred stock is required to amend the terms
of the series C preferred stock.

The series C preferred stock does not limit
or qualify the rights of the holders to be sold in this offering except for the voting rights and potential liquidation preference
described above.

Other Warrants

February 2013 Warrants

On February 5, 2013, in connection with
the issuance of our initial secured convertible promissory notes, we issued to the same accredited investors warrants to purchase
up to an aggregate of 37,594 shares of common stock at an exercise price of $2.66 per share. The warrants contain full ratchet
anti-dilution price protection upon the issuance of equity or equity-linked securities at an effective common stock purchase price
of less than $2.66 per share as well as other customary anti-dilution protection. The holders of such warrants have the right
to exercise the warrants by means of a cashless exercise. Upon the occurrence of certain change of control transactions, then
any holder of the warrants shall, upon exercise, have the right to acquire the same securities as if it had exercised the warrants
immediately before the date on which a record is taken for such transaction, or, if no such record is taken, the date as of which
the record holders of shares of common stock are to be determined for the participation in such transaction. As amended and restated,
these warrants include provisions that block exercise if such exercise will result in the holder having beneficial ownership of
more than 9.99% of our common stock (see “Certain Relationships and Related Transactions”). The warrants expire on
February 5, 2018.

March 2013 Warrants

On March 28, 2013, in connection with the
issuance of our amended and restated secured convertible promissory notes, we issued to the same accredited investors warrants
to purchase up to an aggregate of 37,594 shares of common stock at an exercise price of $2.66 per share. The warrants contain
identical terms to those of the February 2013 Warrants, other than that the warrants expire on March 28, 2018.

June 2013 Warrants

On June 3, 2013, in connection with the
issuance of our second amended and restated secured convertible promissory notes, we issued to the same accredited investors warrants
to purchase up to an aggregate of 37,594 shares of common stock at an exercise price of $2.66 per share. The warrants contain
identical terms to those of the February 2013 Warrants, other than that the warrants expire on June 3, 2018.

August 2013 Warrants

On August 5, 2013, in connection with the
issuance of our third amended and restated secured convertible promissory notes, we issued to the same accredited investors warrants
to purchase up to an aggregate of 37,594 shares of common stock at an exercise price of $2.66 per share. The warrants contain
identical terms to those of the February 2013 Warrants, other than that the warrants expire on August 5, 2018.

October 2013 Warrants

On October 7, 2013, in connection with
the issuance of our fourth amended and restated secured convertible promissory notes, we issued to the same accredited investors
warrants to purchase up to an aggregate of 263,158 shares of common stock at an exercise price of $2.66 per share. The warrants
contain identical terms to those of the February 2013 Warrants, other than that the warrants expire on October 7, 2018.

December 2013 Warrants

On December 9, 2013, in connection with
the issuance of our fifth amended and restated secured convertible promissory notes, we issued to the same accredited investors
warrants to purchase up to an aggregate of 37,594 shares of common stock at an exercise price of $2.66 per share. The warrants
contain identical terms to those of the February 2013 Warrants, other than that the warrants expire on December 9, 2018.

February 2014 Warrants

On February 6, 2014, in connection with
the issuance of our sixth amended and restated secured convertible promissory notes, we issued to the same accredited investors
warrants to purchase up to an aggregate of 37,594 shares of common stock at an exercise price of $2.66 per share. The warrants
contain identical terms to those of the February 2013 Warrants, other than that the warrants expire on February 6, 2019.

April 2014 Warrants

On April 1, 2014, in connection with the
issuance of our seventh amended and restated secured convertible promissory notes, we issued to the same accredited investors
warrants to purchase up to an aggregate of 37,594 shares of common stock at an exercise price of $2.66 per share. The warrants
contain identical terms to those of the February 2013 Warrants, other than that the warrants expire on April 1, 2019.

2014
Warrants

Automatically upon the effectiveness of
this registration statement, we will issue warrants to purchase up to an aggregate of 331,295 shares of common stock at an
exercise price of $1.393per share in exchange for warrants to purchase 2,319,062 shares of series B-2 preferred stock,
at an exercise price of $0.199. The warrants will otherwise be identical to the warrants for which they are exchanged. The warrants
will contain customary anti-dilution protection. The holders of such warrants will have the right to exercise the warrants by
means of a cashless exercise. Upon the occurrence of certain change of control transactions, then any holder of the warrants shall,
upon exercise, have the right to acquire the same securities as if it had exercised the warrants immediately before the consummation
of such transaction. The warrants will expire on November 15, 2018. We anticipate that certain of these warrants will contain
provisions that block exercise if such exercise will result in the holder having beneficial ownership of more than 9.99% of our
common stock (see “Certain Relationships and Related Transactions”).

67

Lock-up Agreements

In connection with this offering, we, our
directors, executive officers and greater than 5% stockholders have agreed not to offer, sell, contract to sell, pledge, grant
options to purchase, or otherwise dispose of any shares of our common stock or securities exchangeable for or convertible into
our common stock for a period of 180 days after the date of this prospectus without the prior written consent of Chardan Capital
Markets LLC, as representative of the underwriters. This agreement does not apply to the issuance of shares upon the exercise
of rights to acquire shares of common stock pursuant to any existing stock option or similar equity incentive or compensation
plan. Our directors and executive officers have agreed, subject to certain exceptions, not to, directly or indirectly, sell,
hedge, or otherwise dispose of any shares of common stock, options to acquire shares of common stock or securities exchangeable
for or convertible into shares of common stock, for a period of 180 days after the date of this prospectus without the prior written
consent of Chardan Capital Markets LLC.

However, in the event that either (i) during
the last 17 days of the “lock-up” period, we release earnings results or material news or a material event relating
to us occurs or (ii) prior to the expiration of the “lock-up” period, we announce that we will release earnings results
during the 16-day period beginning on the last day of the “lock-up” period, the expiration of the “lock-up”
will be extended until the expiration of the 18-day period beginning on the date of the release of the earnings results or the
occurrence of the material news or event, as applicable, unless Chardan Capital Markets LLC waives, in writing, such an extension.

Our certificate of incorporation and bylaws
contain provisions that could have the effect of discouraging potential acquisition proposals or tender offers or delaying or
preventing a change of control of our company. These provisions are as follows:

·

they provide that special meetings of stockholders may be called
only by our chairman, our president or by a resolution adopted by a majority of our board of directors;

·

they do not include a provision for cumulative voting in the
election of directors. Under cumulative voting, a minority stockholder holding a sufficient number of shares may
be able to ensure the election of one or more directors. The absence of cumulative voting may have the effect of
limiting the ability of minority stockholders to effect changes in our board of directors; and

·

they allow us to issue, without stockholder approval, up to 4,000,000 shares of preferred
stock that could adversely affect the rights and powers of the holders of our common stock.

We are subject to the provisions of Section
203 of the General Corporation Law of the State of Delaware, an anti-takeover law. In general, Section 203 prohibits
a publicly held 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 the
business combination is approved in a prescribed manner. For purposes of Section 203, a “business combination”
includes a merger, asset sale or other transaction resulting in a financial benefit to the interested stockholder, and an “interested
stockholder” is a person who, together with affiliates and associates, owns, or within three years prior did own, 15% or
more of the voting stock of a corporation.

Indemnification of Directors and Officers

Section 145 of the General Corporation
Law of the State of Delaware provides, in general, that a corporation incorporated under the laws of the State of Delaware, as
we are, may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed
action, suit or proceeding (other than a derivative action by or in the right of the corporation) by reason of the fact that such
person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation
as a director, officer, employee or agent of another enterprise, against expenses (including attorneys’ fees), judgments,
fines and amounts paid in settlement actually and reasonably incurred by such person in connection with such action, suit or proceeding
if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests
of the corporation and, with respect to any criminal action or proceeding, had no reasonable cause to believe such person’s
conduct was unlawful. In the case of a derivative action, a Delaware corporation may indemnify any such person against
expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection with the defense or settlement
of such action or suit if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed
to the best interests of the corporation, except that no indemnification will be made in respect of any claim, issue or matter
as to which such person will have been adjudged to be liable to the corporation unless and only to the extent that the Court of
Chancery of the State of Delaware or any other court in which such action was brought determines such person is fairly and reasonably
entitled to indemnity for such expenses.

Our certificate of incorporation and bylaws
provide that we will indemnify our directors, officers, employees and agents to the extent and in the manner permitted by the
provisions of the General Corporation Law of the State of Delaware, as amended from time to time, subject to any permissible expansion
or limitation of such indemnification, as may be set forth in any stockholders’ or directors’ resolution or by contract. Any
repeal or modification of these provisions approved by our stockholders will be prospective only and will not adversely affect
any limitation on the liability of any of our directors or officers existing as of the time of such repeal or modification.

We are also permitted to apply for insurance
on behalf of any director, officer, employee or other agent for liability arising out of his actions, whether or not the General
Corporation Law of the State of Delaware would permit indemnification. Effective upon the closing of this offering, we will have
directors’ and officers’ liability insurance insuring our directors and officers against liability for acts or omissions
in their capacities as directors or officers, subject to certain exclusions. Such insurance also insures us against losses which
we may incur in indemnifying our officers and directors. In addition, we have entered into indemnification agreements with key
officers and directors.

Disclosure of Commission Position on Indemnification for
Securities Act Liabilities

Insofar as indemnification for liabilities
arising under the Securities Act of 1933, as amended, may be permitted to our directors, officers and persons controlling us,
we have been advised that it is the Securities and Exchange Commission’s opinion that such indemnification is against public
policy as expressed in the Securities Act of 1933, as amended, and is, therefore, unenforceable.

68

SHARES ELIGIBLE FOR FUTURE ISSUANCE

Prior to this offering, there has been
no public market for our securities, and we cannot predict the effect, if any, that market sales of our securities or the availability
of our securities for sale will have on the market price of our securities prevailing from time to time. Nevertheless, sales of
substantial amounts of our common stock, including shares issued upon exercise of outstanding options, in the public market following
this offering could adversely affect market prices prevailing from time to time and could impair our ability to raise capital
through the sale of our equity securities.

Upon the closing of this offering, we will
have a total of 3,550,897 shares of our common stock outstanding, based on the 2,217,564 shares of our common stock outstanding
as of April 28, 2014, assuming (i) the conversion of all outstanding shares of our convertible preferred stock (other than series
C preferred stock) into an aggregate of 396,444 shares of common stock, which will occur automatically upon the effectiveness
of this registration statement, (ii) the conversion of all outstanding convertible indebtedness, including accrued interest thereon,
into an aggregate of 1,608,969 shares of common stock and 736,333 shares of series C preferred stock, which will occur automatically
upon the effectiveness of this registration statement and (iii) a one-for-seven reverse split of our common stock, which occurred
on May 7, 2014. Of these outstanding shares, all of the 1,333,333 shares of common stock sold in this offering will be freely
tradable, except that any shares purchased in this offering by our affiliates, as that term is defined in Rule 144 under the Securities
Act of 1933, as amended, would only be able to be sold in compliance with the Rule 144 limitations described below.

The remaining outstanding shares of our
common stock will be deemed “restricted securities” as defined in Rule 144. Restricted securities may be sold in the
public market only if they are registered under the Securities Act or if they qualify for an exemption from registration under
Rule 144 or Rule 701 promulgated under the Securities Act of 1933, as amended, which rules are summarized below. In addition,
our executive officers, directors and greater than 5% stockholders have entered into lock-up agreements with the representative
of the underwriters under which they have agreed, subject to specific exceptions, not to sell any of our stock for at least 180
days following the date of this prospectus, as described below. As a result of these agreements, subject to the provisions of
Rule 144 or Rule 701, based on an assumed offering date of , 2014, shares
will be available for sale in the public market as follows:

·

Beginning on the date of this prospectus, all of the units sold in
this offering will be immediately available for sale in the public market;

·

Beginning 181 days after the date of this prospectus, subject to possible extension as described
in “Underwriting” below, 977,564 additional shares of common stock will become eligible for sale in the public
market, all of which will be held by affiliates and subject to the volume and other restrictions of Rule 144, as described
below; and

·

The remainder of the shares will be eligible for sale in the public market from time to time
beginning on the date of this prospectus, as described below.

69

Rule 144

In general, under Rule 144 as currently
in effect, once we have been subject to public company reporting requirements for at least 90 days, a person who is not deemed
to have been one of our affiliates for purposes of the Securities Act at any time during the 90 days preceding a sale and who
has beneficially owned the shares proposed to be sold for at least six months, including the holding period of any prior owner
other than our affiliates, is entitled to sell those shares without complying with the manner of sale, volume limitation or notice
provisions of Rule 144, subject to compliance with the public information requirements of Rule 144. If such a person has beneficially
owned the shares proposed to be sold for at least one year, including the holding period of any prior owner other than our affiliates,
then that person would be entitled to sell those shares upon expiration of the lock-up agreements described below, without complying
with any of the requirements of Rule 144.

In general, under Rule 144, as currently
in effect, our affiliates or persons selling shares on behalf of our affiliates are entitled to sell upon expiration of the lock-up
agreements described above, within any three-month period, a number of shares that does not exceed the greater of:

·

1% of the number of shares of common stock then outstanding, which will equal approximately
35,509 shares immediately after this offering; or

·

the average weekly trading volume of common stock on the Nasdaq
Capital Market during the four calendar weeks preceding the filing of a notice on Form 144 with respect to that sale.

Sales under Rule 144 by our affiliates
or persons selling shares on behalf of our affiliates are also subject to certain manner of sale provisions and notice requirements
and to the availability of current public information about us.

Rule 701

Rule 701 generally allows a stockholder
who purchased shares of our common stock pursuant to a written compensatory plan or contract and who is not deemed to have been
an affiliate of our company during the immediately preceding 90 days to sell these shares in reliance upon Rule 144, but without
being required to comply with the public information, holding period, volume limitation or notice provisions of Rule 144. Rule
701 also permits affiliates of our company to sell their Rule 701 shares under Rule 144 without complying with the holding period
requirements of Rule 144. All holders of Rule 701 shares, however, are required by that rule to wait until 90 days after the date
of this prospectus before selling those shares pursuant to Rule 701, subject to the market standoff agreements and lock-up agreements
described above.

Stock Options

As soon as practicable after the closing
of this offering, we intend to file one or more registration statements on Form S-8 under the Securities Act of 1933, as amended,
covering all of the shares of our common stock subject to outstanding options and the shares of our common stock reserved for
issuance under our stock plans. In addition, we intend to file a registration statement on Form S-8 or such other form as may
be required under the Securities Act of 1933, as amended, for the resale of shares of our common stock issued upon the exercise
of options that were not granted under Rule 701. We expect to file this registration statement as soon as permitted under the
Securities Act of 1933, as amended. However, the shares registered on Form S-8 may be subject to the volume limitations and the
manner of sale, notice and public information requirements of Rule 144 and will not be eligible for resale until expiration of
the lock-up and market standoff agreements to which they are subject.

Lock-up Agreements

For a description of the lock-up agreements
with the representative of the underwriters that restrict sales of shares by us and our executive officers and directors, see
the information under the heading “Underwriting. ”

70

UNDERWRITING

Under the terms and subject to the conditions
contained in an underwriting agreement, we have agreed to sell to the underwriter named below, and the underwriters have agreed
to purchase from us, the number of units set forth opposite its name below:

Underwriter

Number
ofUnits

Chardan
Capital Markets LLC

Maxim Group LLC

Total

The underwriting agreement provides that
the obligation of each underwriter to purchase the units offered hereby is subject to certain conditions and that the underwriters
are obligated to purchase all of the units offered hereby if any of the units are purchased.

If the underwriters sell more units than
the above number, the underwriters have an option for 30 days to buy up to an aggregate of 200,000 additional units from us at
the public offering price less the underwriting commissions and discounts to cover these sales. Prior to separation of the units,
any exercise of the over-allotment will be settled in units, and subsequent to the separation of the units will be settled in
shares of common stock and warrants, as applicable.

The underwriters propose to offer to the
public the units purchased pursuant to the underwriting agreement at the public offering price on the cover page of this prospectus.
After completion of this offering, the underwriters may change the offering price and other selling terms at various times. In
connection with the sale of the units to be purchased by the underwriters, the underwriters will be deemed to have received compensation
in the form of underwriting commissions and discounts.

Commission and Expenses

The underwriters have advised us that they
propose to offer the units to the public at the public offering price set forth on the cover page of this prospectus and to certain
dealers at that price less a concession not in excess of $ per unit. After this
offering, the public offering price and concession may be changed by the underwriters. No such change shall change the amount
of proceeds to be received by us as set forth on the cover page of this prospectus. The units are offered by the underwriters
as stated herein, subject to receipt and acceptance by the underwriters and subject to their right to reject any order in whole
or in part. The underwriters have informed us that they do not intend to confirm sales to any accounts over which they exercises
discretionary authority.

We have agreed to pay to the underwriters
a fee equal to 9% of the aggregate sales price of the units sold in this offering, which fee is to be paid by means of a discount
from the offering price to purchasers in the offering. In addition, we have agreed to reimburse the underwriters for all of their
agreed-upon, actual and out-of-pocket expenses, including but not limited to reasonable and documented travel, legal fees and
other expenses, incurred in connection with the offering, whether or not the offering is completed, subject to presentation of
appropriate documentation evidencing such out-of-pocket expenses up to a maximum of $25,000 for all expenses other than legal
fees plus $125,000 for legal fees upon completion of this offering. In the event that this offering is not consummated, we will
not be required to reimburse the underwriters for more than $25,000 for legal fees and we will not be required to reimburse the
underwriters for any other out of pocket expenses. Notwithstanding the foregoing, if the underwriters terminate the underwriting
agreement prior to closing under certain circumstances, including if we breach the terms of the underwriting agreement or there
is a material adverse change impacting the markets generally or the Company specifically, then the foregoing limitations on reimbursement
of expenses shall not apply. We estimate that expenses payable by us in connection with this offering, other than the underwriting
discounts and commissions referred to above, will be approximately $900,000.

71

The following table summarizes the public
offering price, underwriting discounts and commissions and proceeds before expenses to us assuming both no exercise and full exercise
of the underwriters’ option to purchase additional securities:

Total

Per
Unit

Without

Over-Allotment

WithOver-Allotment

Public
offering price

$

$

$

Underwriting
discounts and commissions

Proceeds,
before expenses, to us

Underwriter Compensation Warrants

The Company shall issue to the underwriters,
upon the closing of the offering, and, if applicable, upon the closing of the over-allotment option, underwriter warrants equal
in number to 5.0% of the aggregate number of units issued under the offering and, in the event that the over-allotment option
is exercised, including 5.0% of the units issued pursuant to the exercise of the over-allotment option. Each underwriter warrant
will have a term of three years commencing one year from the date on which the Registration Statement on Form S-1 of which this
prospectus forms a part is declared effective by the Securities and Exchange Commission and may be exercised on a cashless basis
if not registered. The underwriter warrants will have an exercise price equal to 125% of the per unit price of the units sold
in this offering. The underwriter warrants are exercisable commencing twelve months after the date on which the Registration Statement
on Form S-1 of which this prospectus forms a part is declared effective by the Securities and Exchange Commission. The underwriter
warrants are not redeemable by us.

The underwriter warrants and the securities
underlying such warrants are deemed to be underwriting compensation by the FINRA and are therefore subject to a 180-day lock-up
pursuant to FINRA Rule 5110(g)(1). The underwriters (or permitted assignee under the rule) may not sell, transfer, assign, pledge
or hypothecate the underwriter warrants or the securities underlying these warrants, nor will they engage in any hedging, short
sale, derivative, put or call transaction that would result in the effective economic disposition of the underwriter warrants
or the underlying securities for a period of 180 days from the date on which the Registration Statement on Form S-1 of which this
prospectus forms a part is declared effective by the Securities and Exchange Commission, except to any FINRA member participating
in the offering and their bona fide officers or partners.

Lock Up Agreements

We have agreed not to offer, sell, contract
to sell, pledge, grant options to purchase, or otherwise dispose of any shares of our common stock or securities exchangeable
for or convertible into our common stock for a period of 180 days after the date of this prospectus without the prior written
consent of Chardan Capital Markets LLC, as representative of the underwriters. This agreement does not apply to the issuance
of shares upon the exercise of rights to acquire shares of common stock pursuant to any existing stock option or similar equity
incentive or compensation plan. Our directors, executive officers and greater than 5% stockholders have agreed, subject
to certain exceptions, not to, directly or indirectly, sell, hedge, or otherwise dispose of any shares of common stock, options
to acquire shares of common stock or securities exchangeable for or convertible into shares of common stock, for a period of 180
days from the date on which the Registration Statement on Form S-1 of which this prospectus forms a part is declared effective
by the Securities and Exchange Commission without the prior written consent of Chardan Capital Markets LLC.

However, in the event that either (i) during
the last 17 days of the “lock-up” period, we release earnings results or material news or a material event relating
to us occurs or (ii) prior to the expiration of the “lock-up” period, we announce that we will release earnings results
during the 16-day period beginning on the last day of the “lock-up” period, the expiration of the “lock-up”
will be extended until the expiration of the 18-day period beginning on the date of the release of the earnings results or the
occurrence of the material news or event, as applicable, unless Chardan Capital Markets LLC waives, in writing, such an extension.

Indemnification

The underwriting agreement provides that
we will indemnify the underwriters against certain liabilities that may be incurred in connection with this offering, including
liabilities under the Securities Act, or to contribute payments that the underwriters may be required to make in respect thereof.

Listing

We have applied to list the units on
the Nasdaq Capital Market, subject to notice of issuance, under the symbol “NVBXU.” Once the securities comprising
the units begin trading separately, we anticipate that the shares of common stock and warrants will be listed on the Nasdaq Capital
Market under the symbols “NVBX” and “NVBXW,” respectively.

72

Electronic Distribution

A prospectus in electronic format may be
made available on websites or through other online services maintained by the underwriters of this offering, or by their affiliates.
Other than the prospectus in electronic format, the information on the underwriters’ websites and any information contained
in any other website maintained by an underwriter is not part of this prospectus or the registration statement of which this prospectus
forms a part, has not been approved and/or endorsed by us or the underwriters in their capacity as underwriters, and should not
be relied upon by investors.

Price Stabilization, Short Positions and Penalty Bids

In connection with the offering the underwriters
may engage in stabilizing transactions, over-allotment transactions, syndicate covering transactions and penalty bids in accordance
with Regulation M under the Exchange Act:

·

Stabilizing
transactions permit bids to purchase securities so long as the stabilizing bids do not exceed a specified maximum.

·

Over-allotment involves sales by the underwriters of
securities in excess of the number of securities the underwriters are obligated to purchase,
which creates a syndicate short position. The short position may be either a covered
short position or a naked short position. In a covered short position, the number of
securities over-allotted by the underwriters are not greater than the number of securities
that they may purchase in the over-allotment option. In a naked short position, the number
of securities involved is greater than the number of securities in the over-allotment
option. An underwriter may close out any covered short position by either exercising
its over-allotment option and/or purchasing securities in the open market.

·

Syndicate covering transactions involve purchases of
securities in the open market after the distribution has been completed in order to cover
syndicate short positions. In determining the source of securities to close out the short
position, the underwriters will consider, among other things, the price of securities
available for purchase in the open market as compared to the price at which they may
purchase securities through the over-allotment option. If the underwriters sell more
securities than could be covered by the over-allotment option, a naked short position,
the position can only 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 securities or preventing
or retarding a decline in the market price of our securities. As a result, the price of our securities may be higher than the
price that might otherwise exist in the open market. Neither we nor the underwriters make any representation or prediction as
to the direction or magnitude of any effect that the transactions described above may have on the price of our securities. In
addition, neither we nor the underwriters make any representations that the underwriters will engage in these stabilizing transactions
or that any transaction, once commenced, will not be discontinued without notice.

No Public Market

Prior to this offering, there has not been
a public market for our securities in the U.S. and the public offering price for our units will be determined through negotiations
between us and the underwriters. Among the factors to be considered in these negotiations will be prevailing market conditions,
our financial information, market valuations of other companies that we and the underwriters believe to be comparable to us, estimates
of our business potential, the present state of our development and other factors deemed relevant.

73

We offer no assurances that the initial
public offering price will correspond to the price at which our units, common stock or warrants will trade in the public market
subsequent to this offering or that an active trading market for our units, common stock or warrants will develop and continue
after this offering.

Affiliations

The underwriters and their affiliates may
in the future provide, various investment banking and other financial services for us for which services they may in the future
receive, customary fees. Except for services provided in connection with this offering, the underwriters have not provided any
investment banking or other financial services to us and we do not expect to retain the underwriters to perform any investment
banking or other financial services to us for at least 90 days after the date of this prospectus.

Offers Outside the United States

Other than in the United States, no action
has been taken by us or the underwriters that would permit a public offering of the securities offered by this prospectus in any
jurisdiction where action for that purpose is required. The securities offered by this prospectus may not be offered or sold,
directly or indirectly, nor may this prospectus or any other offering material or advertisements in connection with the offer
and sale of any such securities be distributed or published in any jurisdiction, except under circumstances that will result in
compliance with the applicable rules and regulations of that jurisdiction. Persons into whose possession this prospectus comes
are advised to inform themselves about and to observe any restrictions relating to the offering and the distribution of this prospectus.
This prosp ectus does not constitute an offer to sell or a solicitation of an offer to buy any securities offered by this prospectus
in any jurisdiction in which such an offer or a solicitation is unlawful.

European Economic Area

In relation to each Member State of the
EEA, which has implemented the Prospectus Directive, or a Relevant Member State, an offer to the public of any securities which
are the subject of the offering contemplated by this prospectus may not be made in that Relevant Member State, except that an
offer to the public in that Relevant Member State of any securities may be made at any time under the following exemptions under
the Prospectus Directive, if they have been implemented in that Relevant Member State:

·

to
legal entities which are authorized or regulated to operate in the financial markets
or, if not so authorized or regulated, whose corporate purpose is solely to invest in
securities;

·

to
any legal entity which has two or more of (1) an average of at least 250 employees during
the last financial year; (2) a total balance sheet of more than €43,000,000; and
(3) an annual net turnover of more than €50,000,000, as shown in its last annual
or consolidated accounts;

·

by
the underwriters to fewer than 100 or, if the Relevant Member State has implemented the
relevant provision of the 2010 PD Amending Directive, 150, natural or legal persons (other
than “qualified investors” as defined in the Prospectus Directive) subject
to obtaining the prior consent of the representatives for any such offer; or

·

in
any other circumstances falling within Article 3(2) of the Prospectus Directive; provided
that no such offer of securities shall result in a requirement for the publication by
us or any representative of a prospectus pursuant to Article 3 of the Prospectus Directive.

Any person making or intending to make
any offer of securities within the EEA should only do so in circumstances in which no obligation arises for us or any of the underwriters
to produce a prospectus for such offer.

Neither we nor the underwriters have authorized,
nor do they authorize, the making of any offer of securities through any financial intermediary, other than offers made by the
underwriters which constitute the final offering of securities contemplated in this prospectus.

For the purposes of this provision, and
your representation below, the expression an “offer to the public” in relation to any securities in any Relevant Member
State means the communication in any form and by any means of sufficient information on the terms of the offer and any securities
to be offered so as to enable an investor to decide to purchase any securities, as the same may be varied in that Relevant Member
State by any measure implementing the Prospectus Directive in that Relevant Member State and the expression “Prospectus
Directive” means Directive 2003/71/EC and includes any relevant implementing measure in each Relevant Member State, including
the 2010 PD Amending Directive, to the extent implemented in the Relevant Member State. The expression “2010 PD Amending
Directive” means Directive 2010/73/EU.

Each person in a Relevant Member State
who receives any communication in respect of, or who acquires any securities under, the offer of securities contemplated by this
prospectus will be deemed to have represented, warranted and agreed to and with us and each underwriter that:

·

it
is a “qualified investor” within the meaning of the law in that Relevant
Member State implementing Article 2(1)(e) of the Prospectus Directive; and

·

in
the case of any securities acquired by it as a financial intermediary, as that term is
used in Article 3(2) of the Prospectus Directive, (i) the securities acquired by it in
the offering have not been acquired on behalf of, nor have they been acquired with a
view to their offer or resale to, persons in any Relevant Member State other than “qualified
investors,” as defined in the Prospectus Directive, or in circumstances in which
the prior consent of the representatives has been given to the offer or resale; or (ii)
where securities have been acquired by it on behalf of persons in any Relevant Member
State other than qualified investors, the offer of those securities to it is not treated
under the Prospectus Directive as having been made to such persons.

In addition, in the United Kingdom, this
document is being distributed only to, and is directed only at, and any offer subsequently made may only be directed at persons
who are “qualified investors,” as defined in the Prospectus Directive, (i) who have professional experience in matters
relating to investments falling within Article 19 (5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order
2005, as amended, or the Order, and/or (ii) who are high net worth companies (or persons to whom it may otherwise be lawfully
communicated) falling within Article 49(2)(a) to (d) of the Order (all such persons together being referred to as “relevant
persons”). This document must not be acted on or relied on in the United Kingdom by persons who are not relevant persons.
In the United Kingdom, any investment or investment activity to which this document relates is only available to, and will be
engaged in with, relevant persons.

Israel

In the State of Israel, the securities
offered hereby may not be offered to any person or entity other than the following:

·

a
fund for joint investments in trust, i.e., mutual fund, as such term is defined in the
Law for Joint Investments in Trust, 5754-1994, or a management company of such a fund;

·

a
provident fund as defined in the Control of the Financial Services (Provident Funds)
Law 5765-2005, or a management company of such a fund;

·

an
insurer, as defined in the Law for Oversight of Insurance Transactions, 5741-1981;

·

a
banking entity or satellite entity, as such terms are defined in the Banking Law (Licensing),
5741-1981, other than a joint services company, acting for its own account or for the
account of investors of the type listed in Section 15A(b) of the Securities Law, 1968;

·

a
company that is licensed as a portfolio manager, as such term is defined in Section 8(b)
of the Law for the Regulation of Investment Advisors and Portfolio Managers, 5755-1995,
acting on its own account or for the account of investors of the type listed in Section
15A(b) of the Securities Law, 1968;

·

an
investment advisor or investment distributer, as such term is defined in Section 7(c)
of the Law for the Regulation of Investment Advisors and Portfolio Managers, 5755-1995,
acting on its own account;

·

a
member of the Tel Aviv Stock Exchange, acting on its own account or for the account of
investors of the type listed in Section 15A(b) of the Securities Law, 1968;

·

an
underwriter fulfilling the conditions of Section 56(c) of the Securities Law, 5728-1968,
acting on its own account;

·

venture
capital fund, defined as an entity primarily involved in investments in companies which,
at the time of investment, (i) is primarily engaged in research and development or manufacture
of new technological products or processes and (ii) involve above-average risk;

·

entity
fully owned by investors of the type listed in Section 15A(b) of the Securities Law,
5728-1968;

·

an
entity, other than an entity formed for the purpose of purchasing securities in this
offering, in which the shareholders’ equity is in excess of NIS 50 million; and

·

an
individual fulfilling the conditions of Section 9 to the supplement to the Law for the
Regulation of Investment Advisors and Portfolio Managers, 5755-1995, acting on its own
account (for this matter, Section 9 to the supplement shall be referred to as “as
an investor for the meaning of Section 15A(b)(1) of the Securities Law 1968” instead
of “as an eligible client for the meaning of this law”).

Offerees of the securities offered hereby,
or the Investors, in the State of Israel shall be required to submit written confirmation that they fall within the scope of one
of the above criteria, that they are fully aware of the significance of being an Investor pursuant to such criteria and that they
have given their consent, or the Consent. An appeal to an Investor for the Consent shall not be considered a public offering.
This prospectus will not be distributed or directed to investors in the State of Israel who do not fall within one of the above
criteria.

In addition, if a purchase of securities
is made within an institutional trading system, as that term is defined in the Tel Aviv Stock Exchange regulations, a person giving
a stock exchange member his prior Consent before submitting a purchase order to the institutional trading system for the first
time will be seen as acting within the provisions the above criteria with respect to the Consent, provided that if such person
is an investor pursuant to the sixth, tenth, eleventh or twelfth bullet points specified above, such person committed in advance
that, until the last business day of the third month in each year, he will renew his Consent, and that if he withdraws his Consent,
he will notify the stock exchange member immediately and will cease to give purchase orders in such institutional trading institution.

LEGAL MATTERS

The validity of the securities offered
hereby will be passed upon for us by Haynes and Boone, LLP, New York, New York. The underwriters are being represented by Loeb
& Loeb, LLP, New York, New York, in connection with the offering.

EXPERTS

Our consolidated financial statements as
of December 31, 2012 and 2013 and for each of the two years ended December 31, 2013 appearing in this prospectus have been audited
by Kost Forer Gabbay & Kasierer, a member of Ernst & Young Global, independent registered public accounting firm, as set
forth in their report thereon appearing herein (which contains an explanatory paragraph describing conditions that raise a substantial
doubt about our ability to continue as a going concern as described in Note 1b to the consolidated financial statements), and
are included in reliance upon such report given on the authority of such firm as experts in accounting and auditing.

WHERE YOU CAN FIND ADDITIONAL INFORMATION

We have filed a registration statement
on Form S-1 with the Securities and Exchange Commission in connection with this offering. In addition, as a result
of this offering, we will become subject to the full informational requirements of the Securities Exchange Act of 1934, as amended,
and, accordingly, will file annual, quarterly and current reports and other information with the Securities and Exchange Commission. You
may read and copy the registration statement and any other documents we have filed at the Securities and Exchange Commission’s
Public Reference Room at 100 F Street, N.W., Washington, D.C. 20549, on official business days during the hours of
10:00 am to 3:00 pm.. Please call the Securities and Exchange Commission at 1-800-SEC-0330 for further information
on the Public Reference Room. Our Securities and Exchange Commission filings are also available to the public at the
Securities and Exchange Commission’s Internet site at “http://www.sec.gov”. Upon completion of this offering,
you will also be able to access, free of charge, our reports filed with the Securities and Exchange Commission through our website
(www.nanovibronix.com). Reports filed with or furnished to the Securities and Exchange Commission will be available as soon as
reasonably practicable after they are filed with or furnished to the Securities and Exchange Commission. None of the information
contained on, or that may be accessed through our websites or any other website identified herein is part of, or incorporated
into, this prospectus. All website addresses in this prospectus are intended to be inactive textual references only.

This prospectus is part of the registration
statement and does not contain all of the information included in the registration statement. Whenever a reference is made in
this prospectus to any of our contracts or other documents included as exhibits to this registration statement, the reference
may not be complete and, for a copy of the contract or document included as exhibits to this registration statement, you should
refer to the exhibits that are a part of the registration statement.

74

NANOVIBRONIX INC. AND ITS SUBSIDIARY

CONSOLIDATED FINANCIAL STATEMENTS

AS OF DECEMBER 31, 2013

U.S. DOLLARS IN THOUSANDS

INDEX

Page

Report of Independent Registered Public Accounting
Firm

F-2

Consolidated Balance Sheets

F-3 - F-4

Consolidated Statements of Comprehensive Loss

F-5

Consolidated Statements of Changes in Stockholders'
Deficiency

F-6

Consolidated Statements of Cash Flows

F-7

Notes to Consolidated Financial Statements

F-8 - F-30

- - - - - - - - - - - - - -

F-1

REPORT OF INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM

To the Stockholders and the Board
of Directors of

NANOVIBRONIX INC.

We have audited
the accompanying consolidated balance sheets of NanoVibronix Inc. ("the Company") and its subsidiary as of December
31, 2013 and 2012, and the related consolidated statements of comprehensive loss, changes in stockholders' deficiency and cash
flows for each of the two years ended December 31, 2013. These consolidated financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We conducted our
audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require
that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material
misstatement. We were not engaged to perform an audit of the Company's internal control over financing reporting. Our audit includes
consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial
reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis
for our opinion.

In our opinion,
based on our audits, the consolidated financial statements referred to above, present fairly, in all material respects, the consolidated
financial position of the Company and its subsidiary as of December 31, 2013 and 2012, and the consolidated results of their operations,
changes in stockholders' deficiency and cash flows for each of the two years ended December 31, 2013, in conformity with
U.S. generally accepted accounting principles.

The accompanying
consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As more fully
described in Note 1b, the Company has incurred recurring losses and negative cash flows from operating activities during the year
ended December 31, 2013. Its ability to continue to operate is dependent upon obtaining additional financial support. These conditions
as described in Note 1b, raise substantial doubt about the Company's ability to continue as a going concern. The consolidated
financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification
of assets or the amounts and classification of liabilities that may result from the outcome of this uncertainty.

Tel-Aviv, Israel

KOST FORER GABBAY & KASIERER

March 6, 2014

A Member of Ernst & Young Global

Except for
Note 15g to which the date is May 7, 2014

F-2

NANOVIBRONIX INC. AND ITS SUBSIDIARY

CONSOLIDATED
BALANCE SHEETS

U.S. dollars in thousands

December 31,

2013

2012

ASSETS

CURRENT ASSETS:

Cash and cash equivalents

$

94

$

101

Trade receivables

13

7

Prepaid expenses and other accounts
receivable (Note 3)

52

17

Inventories

65

60

Total
current assets

224

185

PROPERTY AND
EQUIPMENT, NET (Note 4)

23

28

DEFERRED ISSUANCE
COSTS (Note 5)

272

-

SEVERANCE PAY
FUND

172

136

Total
assets

$

691

$

349

The accompanying notes are an integral
part of the consolidated financial statements.

F-3

NANOVIBRONIX INC. AND ITS SUBSIDIARY

CONSOLIDATED
BALANCE SHEETS

U.S. dollars in thousands (except share
data)

December 31,

2013

2012

LIABILITIES AND STOCKHOLDERS' DEFICIENCY

CURRENT LIABILITIES:

Accounts payable

$

18

$

20

Other accounts payables (Note 6)

433

75

Convertible
Promissory notes (Note 8)

3,107

-

Total
current liabilities

3,558

95

LONG-TERM LIABILITIES:

Convertible Promissory notes (Note
8)

-

1,946

Warrants to purchase Common stock

253

-

Accrued severance
pay

177

140

Total
long-term liabilities

430

2,086

COMMITMENTS AND CONTINGENT LIABILITIES
(Note 7)

STOCKHOLDERS' DEFICIENCY (Note 11):

Stock capital -

Common
stock of $ 0.001 par value - Authorized: 24,000,000 shares at December 31, 2013 and 2012; Issued and outstanding:
155,009 shares at December 31, 2013 and 2012

*) -

*) -

Series
A-1 Preferred stock of $ 0.001 par value - Authorized: 400,000 shares at December 31, 2013 and 2012; Issued and outstanding:
222,620 shares at December 31, 2013 and 2012

*) -

*) -

Series
A-2 Preferred stock of $ 0.001 par value - Authorized: 300,000 shares at December 31, 2013 and 2012; Issued and outstanding:
171,612 shares at December 31, 2013 and 2012

*) -

*) -

Additional paid-in capital

10,906

10,382

Accumulated
deficit

(14,203

)

(12,214

)

Total
stockholders' deficiency

(3,297

)

(1,832

)

Total
liabilities and stockholders' deficiency

$

691

$

349

*) Represents an amount lower than
$ 1.

The accompanying notes are an integral
part of the consolidated financial statements.

F-4

NANOVIBRONIX INC. AND ITS SUBSIDIARY

CONSOLIDATED
STATEMENTS OF COMPREHENSIVE LOSS

U.S. dollars in thousands (except share
data)

Year
ended December 31,

2013

2012

Revenues

$

211

$

166

Cost of revenues

91

50

Gross profit

120

116

Operating expenses:

Research and development, net

620

572

Selling and marketing

244

190

General and
administrative

366

128

Total
operating expenses

1,230

890

Operating loss

1,110

774

Other income

36

-

Financial expense,
net (Note 12)

880

501

Loss before
taxes on income

1,954

1,275

Taxes on income
(Note 10)

35

-

Net loss

$

1,989

$

1,275

Total comprehensive
loss

$

1,989

$

1,275

Net basic
and diluted loss per share (Note 14)

$

(12.83

)

$

(8.23

)

Weighted
average number of Common stock used in computing basic and diluted net loss per share

155,009

155,009

The accompanying notes are an integral
part of the consolidated financial statements.

F-5

NANOVIBRONIX INC. AND ITS SUBSIDIARY

CONSOLIDATED
STATEMENTS OF CHANGES IN SHAREHOLDERS' DEFICIENCY

U.S. dollars in thousands (except share
data)

Preferred
stock

Common
stock

Additional
paid-in

Accumulated

Total
stockholders'

Number

Amount

Number

Amount

capital

Deficit

deficiency

Balance
as of January 1, 2012

394,232

$

*) -

155,009

$

*) -

$

10,354

$

(10,939

)

$

(585

)

Stock-based
compensation related to options granted to consultants and employees

-

-

-

-

28

-

28

Total
comprehensive loss

-

-

-

-

-

(1,275

)

(1,275

)

Balance
as of December 31, 2012

394,232

*) -

155,009

*) -

10,382

(12,214

)

(1,832

)

Stock-based
compensation related to options granted to consultants and employees

-

-

-

-

479

-

479

Benefit
component of convertible notes

-

-

-

-

45

-

45

Total
comprehensive loss

-

-

-

-

-

(1,989

)

(1,989

)

Balance
as of December 31, 2013

394,232

$

*) -

155,009

$

*) -

$

10,906

$

(14,203

)

$

(3,297

)

*) Represents an amount lower than
$ 1.

The accompanying notes are an integral
part of the consolidated financial statements.

F-6

NANOVIBRONIX INC. AND ITS SUBSIDIARY

CONSOLIDATED
STATEMENTS OF CASH FLOWS

U.S. dollars in thousands

Year
ended December 31,

2013

2012

Cash
flows from operating activities:

Net loss

$

(1,989

)

$

(1,275

)

Adjustments to reconcile net loss
to net cash used in operating activities: