8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 8-K

Current Report

Pursuant to Section 13 or 15(d) ofthe Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): December 9, 2021

MARPAI, INC.

(Exact name of registrant as specified in its charter)

001-40904

(Commission File Number)

Delaware	86-1916231
(State or other jurisdiction of <br><br>incorporation)	(I.R.S. Employer Identification No.)

5701 East Hillsborough Avenue, Suite 1417,Tampa, Florida 33610

(Address of principal executive offices, with zip code)

(646) 303-3483

(Registrant's telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Ticker symbol(s)	Name of each exchange on which registered
Class A Common Stock, par value $0.0001 per share	MRAI	The NASDAQ Capital Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company x

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

Item 2.02	Results of Operations and Financial Condition.

On December 9, 2021, Marpai, Inc. ("Marpai" or the "Company") issued a press release providing selected financial information for the three and nine months ended September 30, 2021, and its outlook. A copy of the press release is attached as Exhibit 99.1 hereto and is incorporated by reference into this Item 2.02 in its entirety.

Item 9.01	Financial Statements and Exhibits.

(d) Exhibits.

Exhibit Number	Description
99.1	Press Release of Marpai Inc., dated December 9, 2021

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SIGNATURES

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

MARPAI, INC.
Date: December 9, 2021	By:	/s/ Edmundo Gonzalez
---	---	---
	Name:	Edmundo Gonzalez
	Title:	Chief Financial Officer

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Exhibit 99.1

MARPAI, INC.REPORTS THIRD QUARTER 2021 FINANCIAL RESULTS

22% Increase in revenue in q3 2021 versus tHE SECOND QUARTER OF 2021

company PROVIDES 2021 FOURTH QUARTER REVENUE GUIDANCE OF $5.6M-$5.8M

december 9, 2021

New York, NY--(BUSINESS WIRE)—Marpai, Inc. (“Marpai” or the “Company”) (NASDAQ: MRAI), a deep learning technology company transforming third party administration (TPA) in the self-funded health insurance market, today reported financial results for the quarter and nine months ended September 30, 2021.

The Company’s consolidated results of operations include the results of operations of Marpai and its wholly owned subsidiary Marpai Health, Inc. for all periods presented and the results of Continental Benefits, LLC. since its acquisition on April 1, 2021.

FinancialHighlights

·	Net<br> revenue of approximately $4.8 million for the third quarter of 2021, compared to revenues<br> of approximately $3.5 million for the first six months of 2021 (which included the revenues<br> of Continental Benefits for the period April 1, 2021 through June 30, 2021), representing<br> a sequential increase of approximately 36%. The Company’s revenues for the third quarter<br> of 2020 were zero as prior to the acquisition of Continental Benefit it did not have any<br> revenues.
·	Excluding<br> purchase price related accounting adjustment to revenues of approximately $400,000, net revenue<br> for the three months ended June 30, 2021 were approximately $3.9 million, which results<br> in Q3 2021 sequential revenue growth of approximately 22%.
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·	The<br> number of our customers’ employees covered under the Company’s administered health<br> plans increased by approximately 23% from 20,400 on June 30, 2021 to 25,136 on September 30,<br> 2021.
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·	Operating<br> expenses were approximately $9.5 million for the third quarter of 2021 as compared to approximately<br> $0.8 million for the third quarter of 2020, reflecting the acquisition of Continental Benefit<br> and the increase in the overall level of activity in the Company.
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·	Net<br> loss was approximately $4.8 million for the third quarter of 2021 as compared to net loss<br> of approximately $0.9 million for the third quarter of 2020.
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·	Adjusted<br> negative EBITDA of approximately $3.7 million for the third quarter 2021 compared to negative<br> EBITDA of approximately $0.6 million for the third quarter of 2020.
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·	On<br> October 29, 2021, the Company closed its initial public offering (IPO), and issued 7,187,500<br> shares of common stock (including the exercise and closing of the underwriters’ over-allotment<br> option shares) at a price of $4 per share with gross proceeds of $28.75 million and net proceeds<br> of approximately $24.8 million, after deducting underwriting commissions and offering expenses.
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“I am very pleased with our third quarter revenue growth,” said Edmundo, Gonzalez, Chief Executive Officer. “We are laser focused on bringing our Artificial Intelligence-powered services to market, allowing our self-funded clients to have a valuable alternative to traditional third-party administrators. Our successful IPO has provided us with the financial strength to accelerate these growth strategies. We are grateful for the support of our new and legacy investors, and I am very excited about the potential of Marpai moving forward.”

Q42021 Financial Guidance

The Company expects fourth quarter 2021 revenue to be in a range of $5.6 million to $5.8 million, representing sequential growth of 17% to 21% compared to the third quarter of 2021.

The foregoing forward-looking statements reflect our expectations as of today's date. Given the number of risk factors, uncertainties and assumptions discussed below, actual results may differ materially. We do not intend to update our financial outlook until our next quarterly results announcement.

Webcast and ConferenceCall Information

Marpai will host a conference call and webcast today, Thursday, December 9 at 4:15 p.m. ET to answer questions about the Company's operational and financial highlights for its third quarter ended September 30, 2021.

Investors interested in listening to the conference call may do so by dialing (844)-407-9716 for domestic callers or +1-201-493-6779 for international callers, or via webcast: https://viavid.webcasts.com/starthere.jsp?ei=1517026&tp_key=d15f900a41.

For interested individuals unable to join the conference call, a dial-in replay of the call will be available until December 23, 2021 and can be accessed by dialing +1-844-512-2921 (U.S. Toll Free) or +1-412-317-6671 (International) and entering replay pin number: 13725448. A recording of the webcast will also be available for 90 days on the Marpai, Inc. investor relations site https://ir.marpaihealth.com.

About Marpai, Inc.

Marpai, Inc. (Nasdaq: MRAI) is a technology company delivering an AI-powered alternative to traditional TPAs (third party administrators) in the self-funded health plan sector representing over $1T in annual healthcare claims and 95 million Americans. Marpai uses advanced technologies, including proprietary predictive deep learning models, to drive healthcare costs down and health outcomes up. Marpai's SMART services system predicts member health states to prevent costly events, elevates care quality, rigorously processes claims and empowers members to live  healthier lives. Marpai serves self-funded employers nationwide, offers world class provider networks including Aetna and Cigna, and partners with brokers and consultants across the country. For more information, visit www.marpaihealth.com.

Forward-Looking Statement Disclaimer

This press release contains forward-looking statements, as that term is defined in the Private Litigation Reform Act of 1995, that involve significant risks and uncertainties, including statements regarding anticipated fourth-quarter results. Forward-looking statements can be identified through the use of words such as "anticipates," "expects," "intends," "plans," "believes," "seeks," "estimates," "may," "can," "could", "will", "potential", "should," "goal" and variations of these words or similar expressions. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect Marpai's current expectations and speak only as of the date of this release. Actual results may differ materially from Marpai's current expectations depending upon a number of factors. These factors include, among others, adverse changes in general economic and market conditions, competitive factors including but not limited to pricing pressures and new product introductions, uncertainty of customer acceptance of new product offerings and market changes, risks associated with managing the growth of the business. Except as required by law, Marpai does not undertake any responsibility to revise or update any forward-looking statements whether as a result of new information, future events or otherwise.

More detailed information about Marpai and the risk factors that may affect the realization of forward-looking statements is set forth in Marpai's filings with the Securities and Exchange Commission. Investors and security holders are urged to read these documents free of charge on the SEC's web site at http://www.sec.gov.

Media contact:

Erika Beerbower

Lightspeed PR

[email protected]

407-758-2727

Investor Relations contact:

Dave Gentry

RedChip Companies Inc.

1-800-RED-CHIP (733-2447)

or 407-491-4498

[email protected]

Use of Non-GAAP FinancialMeasures and Their Limitations

In addition to our results and measures of performance determined in accordance with U.S. GAAP presented in this press release, we believe that certain non-GAAP financial measures are useful in evaluating and comparing our financial and operational performance over multiple periods, identifying trends affecting our business, formulating business plans and making strategic decisions.

Adjusted EBITDA is a key performance measure that our management uses to assess our financial performance and is also used for internal planning and forecasting purposes.

We believe that Adjusted EBITDA, together with a reconciliation to net income, helps identify underlying trends in our business and helps investors make comparisons between our company and other companies that may have different capital structures, tax rates, or different forms of employee compensation. Accordingly, we believe that Adjusted EBITDA provides useful information to investors and others in understanding and evaluating our operating results, enhancing the overall understanding of our past performance and future prospects, and allowing for greater transparency with respect to a key financial metric used by our management in its financial and operational decision-making. Our use of Adjusted EBITDA has limitations as an analytical tool, and you should not consider these measures in isolation or as a substitute for analysis of our financial results as reported under U.S. GAAP. Some of these potential limitations include:

·	other<br> companies, including companies in our industry which have similar business arrangements,<br> may report Adjusted EBITDA, or similarly titled measures but calculate them differently,<br> which reduces their usefulness as comparative measures;
·	although<br> depreciation and amortization expenses are non-cash charges, the assets being depreciated<br> and amortized may have to be replaced in the future, and Adjusted EBITDA does not reflect<br> cash capital expenditures for such replacements or for new capital expenditure requirements;
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·	Adjusted<br> EBITDA also does not reflect changes in, or cash requirements for, our working capital needs<br> or the potentially dilutive impact of stock-based compensation; and
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·	Adjusted<br> EBITDA does not reflect the interest expense, or the cash requirements necessary to service<br> interest or principal payments, on our debt that we may incur.
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Because of these and other limitations, you should consider our non-GAAP measures only as supplemental to other GAAP-based financial measures

MARPAI, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share data)

(unaudited)

			December 31,
			2020
ASSETS
Current assets:
Cash and cash equivalents	1,191		$	1,755
Restricted cash	7,810			63
Accounts receivable	300			-
Unbilled, receivable	38			-
Prepaid expenses and other current<br> assets	774			262
Other current<br> assets	53			100
Total<br> current assets	10,166			2,180
Property and equipment, net	721			195
Capitalized software, net	6,617			3,819
Operating lease right-of-use<br> assets	1,547			337
Goodwill	1,676			-
Intangible assets, net	6,503			-
Security<br> deposits	52			-
Total<br> assets	27,282		$	6,532
LIABILITIES<br> AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Accounts payable	2,651		$	159
Accounts payable - related party	-			16
Accrued expenses	1,933			268
Accrued fiduciary obligations	5,064			-
Deferred revenues	1,352			-
Current portion of operating<br> lease obligations	714			96
Current portion of convertible<br> notes payable	999			1,866
Short-term loan	2,011			-
Due to<br> related party	4			244
Total current liabilities	14,728			2,649
Convertible notes payable, net<br> of current portion	4,866			7,096
Other long-term liabilities	45			-
Operating lease liabilities,<br> net of current portion	1,027			283
Deferred<br> tax liabilities	2,001			-
Total liabilities	22,667			10,028
Commitments and contingencies
STOCKHOLDERS' EQUITY (DEFICIT)
Common stock, 0.0001 par value,<br> 227,791,050 shares authorized; 11,169,825 issued and outstanding at September 30, 2021 and 142,369 issued and outstanding as<br> of December 31, 2020 (1)	1			1
Additional paid-in-capital	20,411			2,044
Accumulated<br> deficit	(15,797	)		(5,541	)
Total<br> stockholders' equity (deficit)	4,615			(3,496	)
Total<br> liabilities & stockholders' equity (deficit)	27,282		$	6,532

All values are in US Dollars.

(1) Reflects 4.55821-for-1 forward split that became effective September 2, 2021.

MARPAI, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except share and per share data)

(unaudited)

	Three<br> Months Ended<br> September 30,						Nine<br> Months Ended <br><br> September 30,
	2021			2020			2021			2020
Revenue	$	4,799		$	-		$	8,331		$	-
Costs and Expenses
Cost of revenue (exclusive of<br> depreciation and amortization shown separately below)		3,343			-			6,064			-
General and administrative		2,230			281			5,045			1,054
Sales and marketing		1,589			22			3,033			28
Information technology		770			-			1,501			-
Research and development		569			471			1,118			1,497
Depreciation and amortization		802			18			1,223			56
Facilities		232						459			-
Total<br> costs and expenses		9,535			792			18,443			2,635
Operating Loss		(4,736	)		(792	)		(10,112	)		(2,635	)
Other income (expenses)
Other income		55			6			109			19
Interest expense		(109	)		(138	)		(385	)		(364	)
Foreign<br> exchange loss		(3	)		(3	)		(19	)		(5	)
(Loss) before provision<br> for income taxes		(4,793	)		(926	)		(10,406	)		(2,985	)
Income tax benefit		-			-			(150	)		-
Net<br> loss	$	(4,793	)	$	(926	)	$	(10,256	)	$	(2,985	)
Net loss per share, basic& fully diluted (1)	$	(0.47	)	$	(0.37	)	$	(1.31	)	$	(1.29	)
Weighted<br> average number of common shares, basic and fully diluted (1)		10,261,001			2,521,010			7,846,348			2,315,544

(1) Reflects 4.55821-for-1 forward split that became effective September 2, 2021. The computation of basis and diluted net loss per share was retroactively adjusted for all periods presented.

MARPAI, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)

	Nine<br> Months Ended September 30,
	2021			2020
Cash flows from operating<br> activities:
Net loss	$	(10,256	)	$	(2,985	)
Adjustments to reconcile net<br> loss to net cash used in operating activities:
Depreciation and amortization		1,223			56
Share-based compensation		962			836
Amortization of right-to-use<br> asset		43			58
Amortization of debt discount		27			75
Non-cash interest		352			286
Convertible note issued for<br> professional services		75			-
Deferred taxes		(150	)		-
Changes in operating assets<br> and liabilities:
(Increase) in accounts receivable<br> and unbilled receivables		(245	)		-
(Increase) in prepaid expenses<br> and other assets		(380	)		(106	)
Decrease in other receivables		47			-
Decrease in security deposits		3			-
Increase in accounts payable		1,566			70
(Decrease) increase in accounts<br> payable-related party		(16	)		16
Increase in accrued expenses		397			113
Increase in accrued fiduciary<br> obligations		993			-
(Decrease) in operating lease<br> liabilities		(74	)		(65	)
(Decrease) in due to related<br> party		(240	)		-
Increase in other liabilities		147			-
Net cash<br> used in operating activities		(5,526	)		(1,646	)
Cash flows from investing<br> activities
Cash and restricted cash acquired<br> as part of the acquisition of Continental Benefits		11,384			-
Capitalization of software development<br> costs		(1,212	)		(140	)
Purchase of property and equipment		(67	)		(32	)
Reimbursement<br> of leasehold improvements from lease		-			46
Net cash<br> provided by (used in) investing activities		10,105			(126	)
Cash flows from financing<br> activities
Proceeds from stock options exercised		1			-
Proceeds from convertible notes		550			2,000
Proceeds from short-term loan		2,000
Proceeds from issuance of warrants		53			-
Net cash provided by financing activities		2,604			2,000
Net increase in cash, cash<br> equivalents and restricted cash		7,183			227
Cash, cash equivalents<br> and restricted cash at beginning of the period		1,818			246
Cash, cash equivalents<br> and restricted cash at end of period	$	9,001		$	474
Reconciliation of cash,<br> cash equivalents and restricted cash reported in the condensed consolidated balance sheet
Cash and cash equivalents	$	1,191		$	414
Restricted cash		7,810			59
Total<br> cash, cash equivalents and restricted cash in the condensed consolidated statement of cash flows	$	9,001		$	474
Supplemental disclosures<br> of non-cash activity
Conversion of convertible notes<br> at the closing of the Continental Benefits acquisition	$	4,175		$	-
Common<br> stock issued as part of the acquisition of Continental Benefits	$	8,500		$	-

MARPAI, INC. AND SUBSIDIARIES

RECONCILIATION OF NET LOSS TO NON-GAAP ADJUSTED EBITDA

(in thousands)

(unaudited)

	Three Months<br> Ended						Nine Months<br> Ended
	September 30,						September 31,
	2021			2020			2021			2020
Net Income<br> (loss)	$	(4,793	)	$	(926	)	$	(10,256	)	$	(2,985	)
Interest expense and foreign<br> exchange loss, net		57			135			295			350
Income tax (benefit)		-			-			(150	)		-
Depreciation and amortization<br> expense		802			18			1,223			56
Stock based<br> compensation expense		253			195			962			836
Adjusted<br> EBITDA	$	(3,681	)	$	(578	)	$	(7,926	)	$	(1,743	)