TechCare Corp. (Form: 10-Q, Received: 05/14/2019 17:21:07)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

[X]

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

For the quarterly period ended March 31, 2019

[ ]

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

For the transition period from ________________ to ________________

Commission file number: 000-55680

TECHCARE CORP.
(Exact Name Of Registrant As Specified In Its Charter)

Delaware		68-0080601
(State of Incorporation)		(I.R.S. Employer Identification No.)

1140 Avenue of the Americas, New York, NY		10036
(Address of Principal Executive Offices)		(ZIP Code)

+ (972) 3 750-3060 or (646) 380-6645

Registrant’s Telephone Number, Including Area Code:

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

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

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

Large accelerated filer [ ]	Accelerated filer [ ]	Non-Accelerated filer [ ]	Smaller reporting company [X]
Emerging Growth Company [ ]

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

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

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

Title of each class		Trading Symbol(s)		Name of exchange on which registered
N/A		-		-

On May 13, 2019, the registrant had 34,169,890 shares of common stock outstanding.

TABLE OF CONTENTS

Item	Description	Page

	PART I - FINANCIAL INFORMATION

ITEM 1.	FINANCIAL STATEMENTS (UNAUDITED).	3
	Condensed Consolidated Balance Sheets	3
	Condensed Consolidated Statements of Operations and Comprehensive loss	4
	Condensed Consolidated Statements of Cash Flows	5
	Notes to Unaudited Financial Statements	6
ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS.	11
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.	16
ITEM 4.	CONTROLS AND PROCEDURES.	16

	PART II - OTHER INFORMATION
ITEM 6.	EXHIBITS.	17
	SIGNATURES.	18

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

TechCare Corp.

Condensed Consolidated Balance Sheets

As of March 31, 2019 and December 31, 2018

(Unaudited)

	March 31, 2019			December 31, 2018
Assets
Current assets:
Cash and cash equivalents	$	370,700		$	474,715
Inventory		224,262			248,912
Accounts receivable		34,640			13,462
Inventory subject to refund		33,378			44,529
Other receivables		60,681			176,583
Total current assets		723,661			958,201

Non-current assets:
Severance pay fund		33,942			27,258
Long-term deposits		18,573			11,366
Right of use asset, net		113,851			-
Property and equipment, net		163,121			161,401
Total non-current assets		329,487			200,025
Total assets	$	1,053,148		$	1,158,226

Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable and accrued expenses	$	187,225		$	231,311
Note payable		80,026			80,026
Current maturities of long-term lease liability		22,031			-
Refund liability		48,067			73,464
Total current liabilities		337,349			384,801

Non-current liability:
Lease liability		91,820			-
Liability for severance pay		31,134			31,971
Total liabilities		460,303			416,772

Stockholders’ equity:
Preferred stock, par value $0.0001 per share, 10,000,000 shares authorized; none issued and outstanding at March 31, 2019 and 2018					-
Common stock, par value $0.0001 per share, 500,000,000 shares authorized; 34,169,890 and 33,212,036 shares issued and outstanding at March 31, 2019 and December 31, 2018, respectively		3,417			3,322
Accumulated other comprehensive income		111,685			106,870
Additional paid-in capital		9,654,727			9,329,419
Stock to be issued		30,000			30,000
Accumulated deficit		(9,206,984	)		(8,728,157	)
Total stockholders’ equity		592,845			741,454
Total liabilities and stockholders’ equity	$	1,053,148			1,158,226

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

TechCare Corp.

Condensed Consolidated Statements of Operations and Comprehensive loss

For the Three-Month Periods ended March 31, 2019 and 2018

(Unaudited)

	For the three months ended March 31, 2019			For the three months ended March 31, 2018

Revenues		58,171			26,722
Cost of revenues		54,388			9,710
Gross profit		3,783			17,012
Research and development expenses		40,807			31,095
Marketing, general and administrative expenses		435,211			464,341
Change in fair value of option liability		-			(132,470	)
Operating loss		472,235			345,954

Financial expenses, net		6,592			17,581

Net loss	$	478,827		$	363,535

Net loss per common stock:
Basic	$	(0.01	)	$	(0.01	)

Weighted average number of common stock outstanding:
Basic		36,496,768			31,136,952

Comprehensive loss:
Net loss		478,827			363,535
Other comprehensive income attributable to foreign currency translation		(4,815	)		(8,792	)
Comprehensive loss		474,012			354,743

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

TechCare Corp.

Condensed Consolidated Statements of Cash Flows

For the Three-Month Periods ended March 31, 2019 and 2018

(Unaudited)

	For the three			For the three
	months ended			months ended
	March 31, 2019			March 31, 2018

Cash flows from operating activities:
Net loss	$	(478,827	)	$	(363,535	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation		7,177			5,439
Change in fair value of option liability		-			(132,470	)
Right of use asset depreciation		130			-
Lease liability		(130	)		-
Inventory subject to refund		12,573			-
Refund liability		(27,743	)		-
Stock-based compensation		3,120			-
Management fee waiver		89,833			-
Changes in operating assets and liabilities:
Other receivables		100,795			43,004
Inventory		32,599			(132,967	)
Accounts payable and accrued expenses		(51,474	)		38,528
Severance payment, net		(7,672	)		508
Net cash used in operating activities		(319,619	)		(541,493	)

Cash flow from investing activities:
Purchase of fixed assets		(3,742	)		(1,397	)
Investment in long-term deposit		(6,844	)		-
Net cash used in investing activities		(10,586	)		(1,397	)

Cash flow from financing activities:
Proceeds from issuance of common stock, net		232,450			900,000
Net cash provided by financing activities		232,450			900,000

Effect of exchange rates on cash and cash equivalents		(6,260	)		6,670
Net increase in cash and cash equivalents		(104,015	)		363,780

Cash and cash equivalents - beginning of period		474,715			589,818
Cash and cash equivalents - end of period	$	370,700		$	953,598

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

TechCare Corp.

Notes to Unaudited Financial Statements

March 31, 2019 (Unaudited)

NOTE 1: NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

A. Nature of operations

TechCare Corp. (“Techcare” or the “Company”) was incorporated under the laws of the State of Delaware on May 26, 2010. The Company’s common stock is traded in the United States on the OTCQB market under the ticker symbol “TECR.”

On February 8, 2016, the Company signed a Merger Agreement with Novomic Ltd. (“Novomic”), a private company incorporated under the laws of the state of Israel. The closing of the merger took place on August 9, 2016 pursuant to which Novomic became a wholly-owned subsidiary of the Company.

Novomic was incorporated as a private company in Israel in 2009. Since inception, Novomic has been a technology company engaged in the design, development and commercialization of a unique delivery platform utilizing vaporization of various natural compounds for multiple health, beauty and wellness applications. Novomic’s delivery platform is proprietary and patented.

Novomic’s first product is Novokid® - an innovative home use device which vaporizes a natural, plant-based, pesticides and silicone-free compound that effectively treats head lice and eggs. The Novokid® kit includes a vaporizer, treatment capsules and treatment cap alongside ancillary components. Novokid® is currently being sold in Israel and the Netherlands.

Novomic is currently working on the research and development of future product offerings for its delivery platform, including Shine, a revolutionary cosmetic device for the treatment and rejuvenation of the hair and scalp.

The Company operates in one operating segment and substantially all assets of the Company and subsidiary are located in Israel.

Going Concern

During the period ended March 31, 2019, the Company had a total comprehensive loss of $0.47 million and had incurred $0.3 million loss from operating cash flow. As of March 31, 2019, the Company incurred accumulated losses of approximately $9.2 million. Based on the projected cash flows and Company’s cash balance as of March 31, 2019, the Company’s management is of the opinion that without further fund raising it will not have sufficient resources to enable it to continue advancing its activities including the development, manufacturing and marketing of its products for a period of at least 12 months from the date of issuance of these financial statements. As a result, there is substantial doubt about the Company’s ability to continue as a going concern.

Management’s plans include the continued commercialization of their products, to continue taking cost reduction steps and securing sufficient financing through the sale of additional equity securities, debt or capital inflows from strategic partnerships. Following the balance sheet date, the Company raised an additional $225,000 in capital. There are no assurances however, that the Company will be successful in obtaining the level of financing needed for its operations. If the Company is unsuccessful in commercializing its products and securing sufficient financing, it may need to reduce activities, or curtail or cease operations. The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets and the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

TechCare Corp.

Notes to Unaudited Financial Statements

March 31, 2019 (Unaudited)

B. Summary of significant accounting policies

The accounting policies adopted are consistent with those of the previous financial year.

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements and condensed footnotes have been prepared in accordance with the applicable rules and regulations of the Securities and Exchange Commission (the “SEC”) regarding interim financial reporting. Accordingly, they do not include all of the information and footnotes required by the accounting principles generally accepted in the United States of America (“U.S. GAAP”), for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring items) considered necessary for fair statement of results for the interim periods presented have been included. The results of operations for three months ended March 31, 2019 are not necessarily indicative of the results to be expected for the year or for other interim periods or for future years. The consolidated balance sheet as of December 31, 2017 is derived from audited financial statements as of that date; however, it does not include all of the information and footnotes required by U.S. GAAP for complete financial statements. These consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018, which was filed with the SEC on March 28, 2019.

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of TechCare, and its subsidiary, Novomic. All intercompany accounts and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from those estimates.

Functional Currency and Foreign Currency Translation and Transactions.

The currency of the primary economic environment in which the operations of the Company and its subsidiary are conducted is the New Israeli Shekel (“NIS”).

The presentation currency of the financial statements is the U.S. dollar. Assets and liabilities are translated at year-end exchange rates, while revenues and expenses are translated at actual exchange rates during the year. Differences resulting from translation are presented in equity, under accumulated other comprehensive income (loss). Gains and losses arising from foreign currency transactions of monetary balances denominated in non-functional currencies are reflected in financial income (expense), net in the consolidated statements of operations and comprehensive loss.

Financial expenses (income), net in the consolidated statements of operations and comprehensive loss comprised mainly of exchange rate differentials.

Impairment of long-lived assets

Long-lived assets held and used by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. In the event that the sum of the expected future undiscounted cash flows expected to be generated by the long-lived assets is less than the carrying amount of such assets, an impairment charge would be recognized and the assets would be written down to their estimated fair values. During the periods ended March 2019 and 2018, no impairment was recorded.

TechCare Corp.

Notes to Unaudited Financial Statements

March 31, 2019 (Unaudited)

Fair Value Measurements

Fair value is defined as the price that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants at the measurement date. A hierarchy has been established for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that are developed using market data, such as publicly available information about actual events or transactions, and that reflect the assumptions that market participants would use when pricing the asset or liability. Unobservable inputs are inputs for which market data are not available and that are developed using the best information available about the assumptions that market participants would use when pricing the asset or liability. The fair value hierarchy categorizes into three levels. Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity can access at the measurement date. Level 2 inputs include inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3 inputs are unobservable inputs for the asset or liability. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1 inputs) and the lowest priority to unobservable inputs (Level 3 inputs). Categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

NOTE 2: NEW ACCOUNTING PRONOUNCEMENTS

Accounting Pronouncements Adopted in Current Period

In February 2016, the Financial Accounting Standards Board issued Accounting Standards Update 2016-02 “Leases.” The guidance establishes a right-of-use (“ROU”) model that requires a lessee to recognize a ROU asset and lease liability on the balance sheet for all leases with a term longer than 12 months. Leases are classified as finance or operating, with classification affecting the pattern and classification of expense recognition in the income statement. The guidance became effective on January 1, 2019. A modified retrospective transition approach is required, applying the new standard to all leases existing at the date of initial application. The adoption of this standard did not have a material effect on the Company’s financial statements.

The Company adopted the new accounting standard Accounting Standards Codification 842 “Leases,” and all the related amendments, on January 1, 2019 and used the effective date as the Company’s date of initial application. Consequently, financial information was not updated and the disclosures required under the new standard are not provided for dates and periods before January 1, 2019. The new standard also provides practical expedients for an entity’s ongoing accounting. The adoption of this standard did not have a material effect on the Company’s financial statements. On January 1, 2019, the Company recognized ROU assets of approximately $113 thousand and lease liabilities of approximately $113 thousand for its operating leases of real estate and vehicles. The adoption of this standard does not have a material impact on the Company’s consolidated statements of income and consolidated statements of cash flows.

TechCare Corp.

Notes to Unaudited Financial Statements

March 31, 2019 (Unaudited)

NOTE 3: STOCKHOLDERS’ EQUITY

On March 13, 2019, we issued and sold to ICB Biotechnology Investments Ltd. (“ICB”) 957,854 of common stock at a price per share of $0.261, for aggregate consideration of $250,000.

NOTE 4: INCOME TAXES

a. Basis of taxation

The Company and its subsidiary are taxed under the domestic tax laws of the jurisdiction of incorporation of each entity (United States and Israel).

b. Carryforward Tax Losses

Carryforward Tax Losses of the Company as of March 31, 2019 amounted to approximately $0.39 million. Carryforward Tax Losses of Novomic amounted to approximately $6 million. A full valuation allowance was created against these carry forward tax losses since the realization of any future benefit from these net operating losses cannot be sufficiently assured at March 31, 2019.

NOTE 5: LOSS PER SHARE

Loss per share is based on the loss that is attributed to the aggregate number of outstanding shares of common stock, divided by the weighted average number of common stock in issue during the period.

NOTE 6: FAIR VALUE OF FINANCIAL INSTRUMENTS

The carrying amount of the Company’s financial instruments, including cash equivalents, accounts receivable and other current assets, accounts payable and accrued liabilities and note payable approximate their fair value, due to their short term in nature and their carrying amounts approximates the amounts expected to be received or paid.

A hierarchy has been established for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. The Company accounts for option liability as Level 3 since its inputs are unobservable inputs for the liability.

The following table is a reconciliation of the change for the financial liability where fair value measurement is estimated utilizing Level 3 inputs:

	2019		2018
	US dollar		US dollar
Fair value as of January 1	$	-		132,470
Change in fair value recognized in statement of operations and comprehensive loss		-		(132,470	)
Fair value as of March 31	$	-		-

TechCare Corp.

Notes to Unaudited Financial Statements

March 31, 2019 (Unaudited)

NOTE 7: RELATED PARTY TRANSACTIONS

a. On May 31, 2015, the Company entered into a consulting agreement with Mr. Yossef De-Levy, a member of the Company’s Board. Pursuant to the consulting agreement, Mr. De-Levy receives a gross monthly amount of NIS 10,000 (approximately $2,900). The foregoing payment is in addition to, and independent of, the fee that Mr. De-Levy is entitled to receive for continued services as a member of the Board. In March 2019 and April 2019, the Company entered into amendments to the consulting agreement, pursuant to which the monthly retainer was waived commencing on November 15, 2018 through August 31, 2019.

b. On December 31, 2015, the Company entered into a consulting agreement with Zvi Yemini, the Company’s Chairman of the Board and with his affiliated entity Y.M.Y Industry Ltd. (“YMY”). Pursuant to the consulting agreement, Mr. Yemini received a gross monthly amount of NIS 24,000 (approximately $6,200). The foregoing payment is in addition to, and independent of, the fee that Mr. Yemini is entitled to receive for continued services as a member of the Board. On February 22, 2017, the Company signed an amendment to the original agreement with Mr. Yemini and YMY. Pursuant to the amendment, Mr. Yemini’s monthly payment was increased to NIS 45,000 (approximately $13,000) starting February 2017. In March 2019 and April 2019, the Company entered into amendments to the consulting agreement, pursuant to which the monthly retainer was waived commencing on November 15, 2018 through August 31, 2019.

c. On July 31, 2016, the Company entered into a consulting agreement with Mr. Oren Traistman, a member of the Board. Pursuant to the consulting agreement, Mr. Traistman receives a gross monthly amount of NIS 10,000 (approximately $2,900). In March 2019 and April 2019, the Company entered into an amendment to the consulting agreement, pursuant to which the monthly retainer was waived commencing on November 15, 2018 through August 31, 2019.

d. On December 31, 2017, the Company entered into a consulting agreement with Mr. Ran Tuttnauer, a member of the advisory Board. Pursuant to the consulting agreement, Mr. Tuttnauer receives a gross monthly amount of $2,000. In March 2019 and April 2019, the Company entered into an amendment to the consulting agreement, pursuant to which the monthly retainer was waived commencing on November 15, 2018 through August 31, 2019.

NOTE 8: SUBSEQUENT EVENTS

In April 2019, the Company purchased 100 ordinary shares of Novomic, its wholly owned subsidiary, for aggregate consideration of NIS 8,093,543 (approximately $2,250,000).

On April 28, 2019, the Company entered into a form of Securities Purchase Agreement (the “Securities Purchase Agreement”) with each of Y.M.Y. Industry Ltd., Traistman Radziejewski Fundacja Ltd. and Microdel Ltd. relating to an offering of an aggregate of 1,229,508 shares of the Company’s common stock at a purchase price of $0.183 per share for aggregate gross proceeds of approximately $225,000. In addition, the Company granted the investors an option, for a period of twelve months, to purchase up to an additional 375,001 shares of common stock at a price per share of $0.60, for additional aggregate consideration of $225,000. The closing of the offering took place on April 29, 2019.

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

FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other Federal securities laws, and is subject to the safe-harbor created by such Act and laws. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expect,” “intend,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential” or “continue,” the negative of such terms, or other variations thereon or comparable terminology. The statements herein and their implications are merely predictions and therefore inherently subject to known and unknown risks, uncertainties, assumptions and other factors that may cause actual results, performance levels of activity, or our achievements, or industry results to be materially different from those contemplated by the forward-looking statements. Such forward-looking statements appear in this Item 2 – “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and may appear elsewhere in this Quarterly Report on Form 10-Q and include, but are not limited to, statements regarding the following:

	●	the prospects of signing agreements with distributors in Europe and the timeline within which that may occur;

	●	our intention to expand our sales points in Israel;

	●	our plan to execute our strategy;

	●	our intention to sell our products in additional pharmacies and various online outlets and the timeline within which that may occur;

	●	our expectations regarding our short- and long-term capital requirements;

	●	our outlook for the coming months and future periods, including but not limited to our expectations regarding future revenue and expenses;

	●	our product development and distribution plans, including those for Novokid® and Shine;

	●	our marketing plans, including timing and regions for marketing our products;

	●	our ability and the effects, if any, of a manufacture cost reduction program;

	●	achieving regulatory approvals;

	●	the proposed joint venture of a Chinese entity in accordance with a joint venture agreement;

	●	our outlook for the coming months and future periods, including but not limited to our expectations regarding future revenue and expenses; and

	●	information with respect to any other plans and strategies for our business.

Our business and operations are subject to substantial risks, which increase the uncertainty inherent in the forward-looking statements contained in this report.

In addition, historic results of scientific research, clinical and preclinical trials do not guarantee that the conclusions of future research or trials would not suggest different conclusions. Also, historic results referred to in this periodic report would be interpreted differently in light of additional research, clinical and preclinical trials results. Except as required by law, we undertake no obligation to release publicly the result of any revision to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. Further information on potential factors that could affect our business is described under the heading “Risk Factors” in Part I, Item 1A, of our Annual Report on Form 10-K for the fiscal year ended December 31, 2018, or the 2018 Annual Report. Readers are also urged to carefully review and consider the various disclosures we have made in that report.

As used in this quarterly report, the terms “we”, “us”, “our”, the “Company” and “TechCare” mean TechCare Corp. and our wholly owned subsidiary, Novomic Ltd., unless otherwise indicated or as otherwise required by the context.

The following financial data in this narrative are expressed in thousands, except for share and share data or as otherwise noted.

Overview and Recent Developments

We are a technology company engaged in the design, development and commercialization of a unique delivery platform utilizing vaporization of various natural compounds for multiple health, beauty and wellness applications. Our delivery platform is proprietary and patented.

Our current product offering includes Novokid® - an innovative home use device which vaporizes a natural, plant-based, pesticides, and silicone-free compound that effectively treats head lice and eggs. Following our soft launch of Novokid® in the Netherlands, we expanded our distribution network and launched Novokid in Israel during late May 2018 through Super Pharm, Israel’s largest and leading drugstore chain. The launch was accompanied by a radio and digital brand awareness and marketing campaign and supported by Meditrend, our Israeli distributor, specializing in health and wellness products while representing leading brands.

We intend to expand our sales points in Israel and began selling our products in additional pharmacies and various online outlets during 2019. As we remain focused on increasing our global footprint and expanding our distribution network, we showcased Novokid® and met potential distributors and partners at CPhI Worldwide, a renowned and leading pharma tradeshow held in Madrid during October 2018. Accordingly, we are exploring various opportunities to sign agreements with distributors in Europe during the fiscal year ending December 31, 2019. We are also working on erecting an automated production line which is expected to ramp up our manufacturing capacity while reducing its costs.

We believe that we will need to raise up to $2,000 thousand during the year ending December 31, 2019 in order to successfully implement our business plan, of which there can be no assurance. Failure to obtain the necessary capital at acceptable terms, if at all, when needed, may force us to delay, limit, or terminate our product development efforts and adversely effect our ability to secure regulatory approvals and would adversely impact our planned research and development efforts in connection with our future products, which may make it more difficult for us to attain profitability.

Our Treatment Solutions

Novokid® – Natural, Plant-based and Effective Lice Treatment

Parents and children exposed to head lice are now forced to use standard over-the-counter, or OTC, treatments that are toxic, often ineffective, time consuming and expensive. According to the Journal of Medical Entomology, 98% of lice have developed resistance to existing treatments in the US and they are now referred to as “super-lice”. Most current treatments contain pesticides, alcohol or silicone, which are all associated with a wide variety of hazardous side effects.

Novokid® is a non-pesticide, natural, plant-based and eco-friendly solution that eliminates lice and super lice with a 10 minute dry treatment. This compares with current treatments that require 20-40 minutes of shampooing and combing. Our treatment is fast, dry, clean, and easily administered at home or on the go. Novokid® can also be used as a maintenance treatment if used regularly.

Shine – Natural Haircare rejuvenation

Shine uses a patented vaporization process and formulation to clean, treat and improve the appearance of the hair and scalp. In addition to removing the residue, the treatments balance the hair’s pH levels, add body and shine, define curls, and strengthen and protect hair from further damage. We believe that the Shine treatment is user friendly, requiring the user to connect the Using Shine capsule to a designated tube, place the attached cap on their head and sit for a 10-minute treatment. There is no need to rinse or shampoo following the treatment. The treatment is expected to cleanse the scalp and leave the hair shiny and manageable.

Recent Developments and Plans

Our current and future products are all based on the vaporization platform, which was developed over a period of seven years. Since January 1, 2018, we have achieved the following:

●	entered into a distribution agreement with an exclusive distributor of our Novokid® product line in Israel;

●	launched Novokid® in Israel during late May 2018 through Super Pharm, Israel’s largest and leading drugstore chain, accompanied by a radio and digital brand awareness and marketing campaign;

●	expanded our sales points in Israel and penetrated to additional pharmacies and various online outlets, including selling Novokid® on Amazon in the United States;

●	contracted and setup production facilities in China and Israel through sub-contractors;

●	showcased Novokid® in CPhI Madrid, the world’s leading pharma tradeshow, held in Madrid, Spain, during October 2018;

●	entered into a joint venture agreement with a Chinese partner for the formation of a Chinese joint venture intended to focus on the development of comprehensive and broad range of health, wellness, beauty and home products for customers by utilizing our patented technology of vaporization of natural and plant-based compounds;

●	fine-tuned the Shine formulation for the base capsule product; and

●	kicked-off the development for new formulations to create additional capsule lines for the Shine product.

During the next 12-18 months, we plan to focus our efforts on the following:

Novokid®:

	●	launch Novokid® on Amazon.uk;

	●	finalize additional engagements with distributors in Europe and Latin America;

	●	obtain FDA approval through our OEM distributor; and

	●	prepare and implement a manufacture cost reduction program, allowing us to reduce the manufacturing and procurement costs for our Novokid® product.

Shine:

	●	to launch Shine through Kickstarter, following by a launch in the United States, Europe and China;

	●	develop new capsules for personalized treatment, such as dry and curly hair; and

	●	obtain regulatory approval and registration of Shine, as a cosmetic product, in Europe, the United States and China.

Other:

	●	establishment of a Chinese entity in accordance with a joint venture agreement entered between the Company and China-Israel Biological Technology Co. Ltd. on January 21, 2019; and

	●	explore in which medical dermatology indications our technology may have an added value.

We may be required to obtain additional regulatory approvals for our head lice treatment platform and any future products. If unable to receive regulatory approval or commercialize our product candidates, our business will be adversely affected. CE approval, which was already obtained for our Novokid® product, is required for the marketing, distributing and sale of our products in the European Union, whereas FDA approval is required for such marketing, distributing and sale in the United States. In the event that our products are to be sold in certain territories requiring additional regulatory approvals, such approvals will need to be obtained by us or by our distributors.

In addition, in January 2019, we entered into a joint venture agreement with a Chinese partner for the formation of a Chinese joint venture intended to focus on the development of comprehensive and broad range of health, wellness, beauty and home products for customers by utilizing our patented technology of vaporization of natural and plant-based compounds. The joint venture intends to sell its products in the Greater China region, including mainland China, Hong Kong, Macao and Taiwan, directly or through others. We are currently working with our Chinese Partner on the formation of the Chinese joint venture entity.

On March 13, 2019, we issued and sold to ICB Biotechnology Investments Ltd. (“ICB”) 957,854 shares of our common for a price per Share of $0.261, for aggregate consideration of $250,000. In accordance with the terms of the subscription agreement, upon the formation of a joint venture with China-Israel Biological Technology Co. Ltd., (“CIBD”) the parent company of ICB, and the transfer of the relevant intellectual property rights to the joint venture, we will issue and sell to ICB an additional 957,854 Shares for an additional investment amount of $250,000 (the “Additional Investment”). In addition, subject to the consummation of the Additional Investment, we will grant ICB an option to purchase up to additional 833,333 shares of our common stock at a price per share of $0.60, for aggregate consideration of up to $1,000,000.

On April 28, 2019, we entered into a form of Securities Purchase Agreement (the “Securities Purchase Agreement”) with each of Y.M.Y. Industry Ltd., Traistman Radziejewski Fundacja Ltd. and Microdel Ltd. relating to an offering of an aggregate of 1,229,508 shares of our common stock at a purchase price of $0.183 per share for aggregate gross proceeds of approximately $225,000. In addition, we granted the investors an option, for a period of twelve months, to purchase up to an additional 375,001 shares of common stock at a price per share of $0.60, for additional aggregate consideration of $225,000. The closing of the offering took place on April 29, 2019.

Results of Operations during the three months ended March 31, 2019 as compared to the three months ended March 31, 2018

Revenues

During the three months ended March 31, 2019, we generated $58 thousand in revenues, compared to $27 thousand in revenues in the three months ended March 31, 2018. The increase is mainly attributable to an increase in the sale of for our product.

Research and Development Expenses

Our research and development expenses during the three months ended March 31, 2019 were $41 thousand and all expenses resulted from ongoing research and development expenses.

Our research and development expenses during the three months ended March 31, 2018 were $31 thousand. The increase is mainly attributable to expenses related to the new expected Shine product.

Marketing, General and Administrative Expenses

Our marketing, general and administrative expenses during the three months ended March 31, 2019 were $436 thousand and were comprised mainly of $320 thousand in payroll and payments to consultants. Our marketing, general and administrative expenses during the three months ended March 31, 2018 were $464 thousand and were comprised mainly of $286 thousand in payroll and payments to consultants. The decrease in our marketing, general and administrative expenses is mainly attributable to a decrease in marketing expenses and travel abroad expenses.

Net Loss

During the three months ended March 31, 2019 we incurred a net loss of $479 thousand. During the three months ended March 31, 2018, we incurred a net loss of $364 thousand. The increase in net loss is mainly attributable to a decrease in gross margins.

Liquidity and Capital Resources

Our balance sheet as of March 31, 2019 reflects total assets of $1,053 thousand, consisting mainly of cash and cash equivalents in the amount of approximately $371 thousand, inventory of approximately $224 thousand and property and equipment, net of approximately $163 thousand. As of December 31, 2018, our balance sheet reflects total assets of approximately $1,158 thousand consisting mainly of cash and cash equivalents in the amount of approximately $475 thousand, inventory in the amount of approximately $249 thousand, other receivables of approximately $177 thousand and property and equipment net, of approximately $161 thousand.

As of March 31, 2019, we had total current liabilities of approximately $337 thousand, consisting mainly of accounts payable and accrued expenses of approximately $187 thousand and a note payable of approximately $80 thousand. As of December 31, 2018, we had total current liabilities of approximately $385 thousand consisting mainly of accounts payable and accrued expenses of approximately $231 thousand and a note payable of approximately $80 thousand.

As of March 31, 2019, we had positive working capital of approximately $386 thousand, compared to positive working capital of approximately $573 thousand at December 31, 2018. The working capital has been sufficient to sustain our operations to date, although there is substantial doubt about our ability to continue as going concern. Our total liabilities as of March 31, 2019 were approximately $460 thousand, compared to approximately $417 thousand at December 31, 2018.

During the three months ended March 31, 2019, we used approximately $320 thousand of cash in our operating activities. This resulted mainly from an overall net loss of approximately $479 thousand, a decrease in other receivables of approximately $101 thousand and a decrease in inventory of approximately $32 thousand. During the three months ended March 31, 2018, we used approximately $540 thousand of cash in our operating activities. This resulted mainly from an overall net loss of approximately $364 thousand, an increase in accounts payable and accrued expenses of approximately $39 thousand and an increase in inventory of approximately $43 thousand.

During the three months ended March 31, 2019, we used approximately $11 thousand in our investing activities, as compared to approximately $1 thousand in the same period in the prior year.

During the three months ended March 31, 2019, our financing activities provided us with $232 thousand, as compared to $900 thousand in the same period in the prior year, through the issuance of common stock.

On March 13, 2019, we issued and sold to ICB 957,854 shares of our common stock at a price per share of $0.261, for aggregate consideration of $250,000. In addition, in April 2019, the Company entered into subscription agreements with several investors, consisting of our officers and directors, pursuant to which we issued 1,229,508 shares of common stock for aggregate consideration of $225,000.

While management believes the Company will be successful in its current and planned operating activities, there can be no assurance that the Company will be successful in the achievement of sales of its products that will generate sufficient revenues to earn a profit and sustain the operations of the Company. Our ability to create sufficient working capital to sustain us over the next twelve-month period and beyond, is dependent on our ability to raise additional funds through the issuance of equity or debt instrument. There can be no assurance that sufficient capital will be available to us. We currently have no agreements, arrangements or understandings with any person to obtain funds through bank loans, lines of credit or any other sources.

Going Concern Consideration

As result of the above, there is substantial doubt about our ability to continue as a going concern. Our financial statements contain additional note disclosures with respect to this matter, but no accounting adjustments that relate to this matter.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements.

Critical Accounting Policies

Please see Note 1B of Part I, Item I of this Quarterly Report on Form 10-Q for the summary of significant accounting policies. In addition, reference is made to Note 1B in the financial statements contained in our Annual Report on Form 10-K for the year ended December 31, 2018 (filed on March 28, 2019) with respect to our Critical Accounting Policies. There have been no other material changes to our critical accounting policies and estimates since our Annual Report on Form 10-K for the year ended December 31, 2018.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not Applicable.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures.

The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the Company’s reports filed under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to the Company’s management, including the Company’s Chief Executive Officer (CEO) (who is the Company’s principal executive officer) and the Company’s Chief Financial Officer (CFO) (who is the Company’s principal financial officer) to allow for timely decisions regarding required disclosure. In designing and evaluating the Company’s disclosure controls and procedures, the Company’s management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and the Company’s management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on our evaluation of the effectiveness of our disclosure controls and procedures as of March 31, 2018, our Company’s CEO and CFO concluded that the Company’s disclosure controls and procedures were not effective to provide reasonable assurance that information required to be disclosed by the Company in reports that it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our CEO and CFO, to allow timely decisions regarding required disclosure.

Management’s Remediation Plan

Since the time our initial material weaknesses were identified in early 2017 relating to (i) inadequate segregation of duties consistent with control objectives; and (ii) ineffective controls over period-end financial reporting and disclosure processes, we have initiated the following procedures during the year ended December 31, 2017:

	(i)	Due to inadequate finance resources as of the end of the first quarter of 2017, we hired during the second quarter of 2017 a new outsourced finance team and replaced our CFO. We believe that this first step should assist in detecting errors that have occurred since the first quarter of 2017.

	(ii)	We began implementing processes and controls to properly perform an effective period-end financial reporting process.

We also plan to implement additional steps as follows: (i) appoint additional qualified personnel to address inadequate segregation of duties and ineffective controls over period-end financial reporting as well as continue implementing modifications to our operating procedures and financial controls to address such inadequacies; and (ii) adopt sufficient written policies and procedures for period-end financial reporting.

The remediation efforts, which are not completed as of March 31, 2019, are largely dependent upon our securing additional financing to cover the costs of implementing the changes required. If we are unsuccessful in securing such funds, remediation efforts may be adversely affected in a material manner.

Changes in Internal Control over Financial Reporting

During the three months ended March 31, 2019, there were no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect the Company’s internal control over financial reporting.

PART II - OTHER INFORMATION

ITEM 6. EXHIBITS

(a) The following documents are filed as exhibits to this report on Form 10-Q or incorporated by reference herein. Any document incorporated by reference is identified by a parenthetical reference to the SEC filing that included such document.

Exhibit No.		Description
10.1*		Subscription Agreement executed by and between Tech Care Corp. and Y.M.Y. Industry Ltd., dated April 28, 2019.
10.2*		Subscription Agreement executed by and between Tech Care Corp. and Traistman Radziejewski Fundacja Ltd., dated April 28, 2019.
10.3*		Subscription Agreement executed by and between Tech Care Corp. and Microdel Ltd., dated April 28, 2019.
31.1*		Rule 13a-14(a) Certification of Chief Executive Officer.
31.2*		Rule 13a-14(a) Certification of Chief Financial Officer.
32.1**		Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350.
32.2**		Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350.
101*		The following materials from our Quarterly Report on Form 10-Q for the quarter ended March 31, 2019 formatted in XBRL (eXtensible Business Reporting Language): (i) the Interim Condensed Consolidated Balance Sheets, (ii) the Interim Condensed Consolidated Statements of Operations, (iii) the Interim Condensed Consolidated Statements of Comprehensive Loss, (iv) the Interim Condensed Statements of Changes in Equity, (v) the Interim Condensed Consolidated Statements of Cash Flows, and (vi) the Notes to Interim Condensed Consolidated Financial Statements, tagged as blocks of text and in detail.

* Filed herewith
** Furnished herewith

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned.

	TechCare Corp.

	By:	/s/ Zvi Yemini
		Zvi Yemini
		Chief Executive Officer
		(Principal Executive Officer)

	Date:	May 14, 2019

	By:	/s/ Tali Dinar
		Tali Dinar
		Chief Financial Officer
		(Principal Financial and Principal Accounting Officer)

	Date:	May 14, 2019

THIS SUBSCRIPTION AGREEMENT RELATES TO AN OFFERING OF SHARES OF COMMON STOCK (THE “OFFERING”), IN AN OFFSHORE TRANSACTION TO PERSONS WHO ARE NOT U.S. PERSONS (AS DEFINED HEREIN) PURSUANT TO REGULATION S PROMULGATED BY THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION (THE “SEC”) UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”).

THE SHARES THAT ARE SUBJECT TO THIS SUBSCRIPTION AGREEMENT IN RELIANCE ON REGULATION S (THE “SUBSCRIPTION AGREEMENT”) HAVE NOT BEEN REGISTERED UNDER THE ACT, OR ANY U.S. STATE SECURITIES LAWS, AND, UNLESS SO REGISTERED, NONE MAY BE OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES OR TO U.S. PERSONS (AS DEFINED HEREIN) EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF REGULATION S UNDER THE ACT, PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE ACT AND IN EACH CASE ONLY IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. IN ADDITION, HEDGING TRANSACTIONS INVOLVING THE SECURITIES MAY NOT BE CONDUCTED UNLESS IN ACCORDANCE WITH THE ACT.

TECHCARE CORP.

(A Delaware corporation)

SUBSCRIPTION AGREEMENT

DATED: April 28, 2019 (the “Effective Date”)

1. The Subscription

1.1 On the basis of the representations and warranties and subject to the terms and conditions set forth in this Subscription Agreement, Y.M.Y Industry Ltd . (Israeli Company No. 512680539), of 38 Yefet St., Tel Aviv-Yafo, Israel ( the “ Investor ”) hereby agrees to subscribe for and purchase 546,448 shares of common stock, par value $0.0001 the “ Initial Shares ”) offered by TechCare Corp., a Delaware corporation with offices located at 1140 Avenue of the Americas, New York, NY 10036 (the “ Company ”), at a purchase price per share of US$ 0.183 (the “ Share Purchase Price ”), for an aggregate consideration of US$ 100,000 (the “ Subscription Proceeds ”), all pursuant to the terms and conditions set forth in this Subscription Agreement.

1.2 In addition, on the basis of the representations and warranties and subject to the terms and conditions set forth in this Subscription Agreement, the Investor shall be entitled, until the 12 month anniversary of the Effective Date, to subscribe for, and purchase, 166,667 additional Shares of TechCare Corp. (the “ Additional Shares ” and together with the Initial Shares, the “ Shares ”) at a purchase price per share of US$0.60, for an aggregate consideration of US$ 100,000 (the “ Additional Subscription Proceeds ”), all pursuant to the terms and conditions set forth in this Subscription Agreement.

1.3 The undersigned Investor understands that the offering by the Company under this Subscription Agreement is being made only to persons/institutions who are not U.S. Persons, as defined in Rule 902 of Regulation S promulgated by the United States Securities and Exchange Commission (“ SEC ”) under the Securities Act of 1933, as amended (the “ Act ”) and that the Company will not offer Shares nor accept subscriptions from any person and/or entity that is a U.S. Person as defined in Rule 902 of Regulation S.

1.4 On the basis of the representations and warranties of the Investor and subject to the terms and conditions set forth herein, the Company, by its execution and delivery of the counter-signed copy of this Subscription Agreement, hereby irrevocably agrees to accept the subscription and sell to the Investor the Shares subscribed for herein.

1.5 Subject to the terms hereof, the offer and sale of the Shares under this Subscription Agreement will be effective only upon receipt by the Company of the Subscription Proceeds.

1.6 Within seven (7) days of from the receipt of the Subscription Proceeds or the Additional Subscription Proceeds by the Company, as applicable, the Company shall deliver to the Investor book entry confirmation representing the number of Shares purchased by the Investor. The Shares shall be registered on the books of the Company as follows: Y.M.Y Industry Ltd. (Israeli Company No. 512680539), of 38 Yefet St., Tel Aviv-Yafo, Israel.

2. Payment of Subscription Proceeds and Additional Subscription Proceeds

The Investor understands that the Subscription Proceeds and Additional Subscription Proceeds, as applicable, are payable to the Company by electronic wire transfer pursuant to the Company’s wiring instructions to be provided thereto.

3. Documents/Deliveries Required from the Investor

3.1 The Investor understands and agrees that as a condition to the Company’s acceptance of this subscription, the undersigned will complete, sign and return to the Company an executed copy of this Subscription Agreement together with any and all attachments hereto.

3.2 The Investor will complete, sign and return to the Company as soon as possible, on request by the Company, any other documents, questionnaires, notices and undertakings as may be reasonably required by regulatory authorities and applicable law.

3.3 The Investor will pay/deliver the Subscription Proceeds and the Additional Subscription Proceeds, as applicable, to the Company as provided in Section 2 above subject to the Company’s execution and acceptance of this Subscription Agreement.

4. Acknowledgements of Investor

4.1 The Investor acknowledges and agrees that:

(i) the Shares being offered have not been registered under the Act, or under any state securities or “blue sky” laws of any state of the United States, and, unless so registered, the Shares may neither be offered nor sold in the United States or, directly or indirectly, to U.S. Persons, as that term is defined in Rule 902 of Regulation S under the Act, except in accordance with the provisions of Regulation S, pursuant to an effective registration statement under the Act, or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Act;

(ii) the Investor acknowledges that the Company has not undertaken, and will have no obligation, to register the Shares under the Act;

(iii) the decision to execute this Subscription Agreement has not been based upon any oral or written representation as to fact or otherwise made by or on behalf of the Company, and such decision is based entirely upon a review of information (the receipt of which is hereby acknowledged) which has been filed by the Company with the SEC under the Securities Exchange Act of 1934 (collectively, the “ Exchange Act Reports ”);

(iv) no securities commission or similar regulatory authority has reviewed or passed on the merits of an investment in the Shares;

(v) there is no government or other insurance covering any investment in the Shares;

(vi) there are risks associated with an investment in the Shares, as more fully described in certain information forming part of the Exchange Act Reports;

(vii) the Investor has had a reasonable opportunity to ask questions of and receive answers from the Company in connection with this subscription and to obtain additional information, to the extent possessed or obtainable without unreasonable effort or expense, necessary to verify the accuracy of the information about the Company;

(viii) the books and records of the Company were available upon reasonable notice for inspection, subject to certain confidentiality restrictions, by the Investor during reasonable business hours at its principal place of business, and all documents, records and books in connection with the distribution of the Shares hereunder have been made available for inspection by the Investor, the Investor’s attorney and/or advisor(s), if any;

(ix) there is no guarantee that the Shares will be listed on any stock exchange or automated dealer quotation system and no representation has been made to the Investor that the Shares will be listed on any stock exchange or automated dealer quotation system;

(x) the Shares are assignable only with the prior written consent of the Company, which consent will not be unreasonably denied, provided that any such transfer is made in accordance with the provisions of Regulation S, pursuant to an effective registration statement under the Act or pursuant to an available exemption from the registration requirements of the Act; and

(xi) this Subscription Agreement is not enforceable by the Investor unless it has been accepted by the Company.

5. Representations, Warranties and Covenants of the Investor

5.1 The Investor hereby represents and warrants to and covenants with the Company (which representations, warranties and covenants shall be true and correct as of the date hereof and as of the subscription date of the Additional Shares, and will survive the execution and delivery of this Subscription Agreement) that:

(i) the Investor has the legal capacity and competence to enter into and execute this Subscription Agreement and to take all actions required pursuant hereto and, if the Investor is a corporation, it is duly incorporated and validly subsisting under the laws of its jurisdiction of incorporation and all necessary approvals by its directors, shareholders and others have been obtained to authorize execution and performance of this Subscription Agreement on behalf of the Investor;

(ii) the Investor is entering into this Subscription Agreement and the transactions contemplated hereby do not result in the violation of any of the terms and provisions of any law applicable to, or the corporate documents of, the Investor or of any agreement, written or oral, to which the Investor may be a party or by which the Investor is or may be bound;

(iii) the Investor has duly executed and delivered this Subscription Agreement and it constitutes a valid and binding agreement of the Investor enforceable against the Investor;

(iv) the Investor is not a U.S. Person, as that term is defined in Rule 902 of Regulation S under the Act;

(v) the Investor is not acquiring the Shares for the account or benefit of, directly or indirectly, any U.S. Person, as that term is defined in Rule 902 of Regulation S under the Act;

(vi) the Investor is resident of the jurisdiction set out under the heading “Name and Address of Investor” on the signature page of this Subscription Agreement;

(vii) the Investor is and will be outside the United States when receiving and executing this Subscription Agreement and is acquiring the Shares as principal for the Investor’s own account (except for the circumstances outlined in paragraph 5.1), for investment purposes only, and not with a view to, or for, resale, distribution or fractionalization thereof, in whole or in part, and no other person has a direct or indirect beneficial interest in the Shares;

(ix) the Investor is acquiring the Shares for investment only and not with a view to resale or distribution and, in particular, it has no intention to distribute either directly or indirectly any of the Shares in the United States or to U.S. Persons;

(x) the Investor is not an underwriter of, or dealer in, the Shares of the Company, nor is the Investor participating, pursuant to a contractual agreement or otherwise, in the distribution of the Shares;

(xi) the Investor:

(a) is able to fend for itself in connection with the offer and sale of Shares under this Subscription Agreement; and

(b) has such knowledge and experience in business matters as to be capable of evaluating the merits and risks of its prospective investment in the Company’s Shares offered hereby; and

(c) has the ability to bear the economic risks of its prospective investment and can afford the complete loss of such investment;

(xii) if the Investor is acquiring the Shares as a fiduciary or agent for one or more investor accounts, the Investor has sole investment discretion with respect to each such account and it has full power to make the foregoing acknowledgements, representations and agreements on behalf of such account, and the investor accounts, if any, for which the Investor acts as a fiduciary or agent satisfy the definition of an “Accredited Investor,” as the term is defined in Rule 501 of Regulation D under the Act;

(xiii) the Investor acknowledges that the Investor has not acquired the Shares as a result of, and will not itself engage in, any “directed selling efforts” (as defined in Regulation S under the Act) in the United States in respect of any of the Shares which would include any activities undertaken for the purpose of, or that could reasonably be expected to have the effect of, conditioning the market in the United States for the resale of any of the Shares, provided, however, that the Investor may sell or otherwise dispose of any of the Shares pursuant to an effective registration statement under the Act and any applicable state securities laws or under an exemption from such registration requirements and as otherwise provided herein;

(xiv) the Investor has not received nor is he aware of any advertisement or public solicitation pertaining to the offer or sale of any of the Shares; and

(xv) no person has made to the Investor any written or oral representations that:

(a) any person will resell or repurchase any of the Shares; and

(b) any person will refund the purchase price of any of the Shares paid by the Investor pursuant to this Subscription Agreement.

6. Conditions Precedent.

The undertaking of the Investor shall be subject to and contingent upon the following:

6.1 Prior to the Effective Date, the Company shall have secured all permits, consents and authorizations that shall be necessary or required lawfully to consummate this Subscription Agreement and to issue Shares in accordance with the terms of this Subscription Agreement. The Company has all requisite corporate power to own and operate its property and assets, to perform all its obligations under all agreements and instruments to which it is a party or by which it is bound, and to carry on the business of the Company as presently conducted and as proposed to be conducted. The Company is in compliance with all applicable laws, including all laws pertaining to it as a public company. All issued and outstanding shares of the Company have been duly authorized, and are validly issued and outstanding and fully paid and non-assessable. The Shares, when issued in accordance with this Subscription Agreement, will be duly authorized, validly issued, fully paid, non-assessable, and free of any preemptive rights, and will have the rights, preferences, privileges, and restrictions set forth in the Certificate of Incorporation of the Company, and will be issued free and clear of any liens, claims, encumbrances or third party rights of any kind and duly registered in the name of the Investor in the Company’s register of members.

6.2 The Company has duly executed and delivered this Subscription Agreement and it constitutes a valid and binding agreement of the Investor enforceable against the Investor.

6.3 The acquisition of and subscription for the Shares by the Investor as contemplated in this Subscription Agreement complies with or is exempt from the applicable securities legislation of the jurisdiction of residence of the Investor.

7. Acknowledgement and Waiver

The Investor hereby acknowledges that the decision to subscribe for and purchase the Shares has been made solely on the basis of publicly available information contained in the Exchange Act Reports. The Investor hereby waives, to the fullest extent permitted by law, any rights of withdrawal, rescission or compensation for damages to which the Investor might be entitled in connection with the distribution of any of the Shares.

8. Restrictive Legend on Subject Securities

8.1 The Investor hereby acknowledges that upon the issuance thereof, and until such time as the same is no longer required under the applicable securities laws and regulations, certificates or book entry forms evidencing the Shares will bear a legend in substantially the following form:

THE SECURITIES REPRESENTED BY THE SHARES HAVE BEEN OFFERED IN AN OFFSHORE TRANSACTION TO A PERSON WHO IS NOT A U.S. PERSON (AS DEFINED HEREIN) PURSUANT TO REGULATION S UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”).

NONE OF THE SHARES HAVE BEEN REGISTERED UNDER THE ACT, OR ANY U.S. STATE SECURITIES LAWS, AND, UNLESS SO REGISTERED, MAY NOT BE OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES OR TO U.S. PERSONS EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF REGULATION S UNDER THE ACT, PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE ACT AND IN EACH CASE ONLY IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. IN ADDITION, HEDGING TRANSACTIONS INVOLVING THE SHARES MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE ACT. “UNITED STATES” AND “U.S. PERSON” ARE AS DEFINED BY REGULATION S UNDER THE ACT.

8.2 The Investor hereby acknowledges and agrees to the Company making a notation on its records in order to implement the restrictions on transfer set forth and described in this Subscription Agreement.

9. Costs

The Investor acknowledges and agrees that all costs and expenses incurred by the Investor (including any fees and disbursements of any counsel or other professional retained by the Investor) relating to the purchase of the Shares will be borne solely by the Investor.

10. Governing Law

This Subscription Agreement is governed by the laws of the State of New York, without regard to the conflict of laws provisions thereof. The Investor, in his personal or corporate capacity and, if applicable, on behalf of each beneficial purchaser for whom it is acting, irrevocably agrees to the jurisdiction of the courts of the State of New York and each Subscriber and the Company waive any right to a jury trial thereof

11. Survival

This Subscription Agreement, including without limitation the representations, warranties and covenants contained herein, will survive and continue in full force and effect and be binding upon the parties hereto notwithstanding the completion of the purchase of the Shares by the Investor pursuant hereto.

12. Assignment

This Subscription Agreement is transferable or assignable only with the prior written consent of the Company, which consent will not be unreasonably denied. Furthermore, except as otherwise expressly limited herein, the provisions hereof shall inure to the benefit of, and be binding upon, the transferees, successors, assigns, heirs, executors, and administrators of the parties hereto.

13. Severability

The invalidity or unenforceability of any particular provision of this Subscription Agreement will not affect or limit the validity or enforceability of the remaining provisions of this Subscription Agreement and the remainder of this Subscription Agreement shall be interpreted as if such provision were so excluded and shall be enforceable in accordance with its terms; provided, however, that in such event this Subscription Agreement shall be interpreted so as to give effect, to the greatest extent consistent with and permitted by applicable law, to the meaning and intention of the excluded provision as determined by such court of competent jurisdiction.

14. Entire Agreement; Amendment

Except as expressly provided in this Subscription Agreement and in the agreements, instruments and other documents contemplated or provided for herein, this Subscription Agreement contains the entire agreement between the parties with respect to the sale of the Shares. The Company makes and has given no other warranties or representations, other than as expressly contained herein. Any term of this Subscription Agreement may be amended and the observance of any term hereof may be waived (either prospectively or retroactively and either generally or in a particular instance) only with the written consent of the Company and the Investor.

15. Notices

All notices here under will be in writing and will be deemed to have been duly given if mailed or transmitted by any standard form of telecommunication. Notices to the Investor will be directed to the address on the Investor’s signature page and notices to the Company will be directed to it at the address first set forth above unless another address will be provided to the Investor by the Company in writing.

16. Counterparts and Electronic Means

This Subscription Agreement may be executed in any number of counterparts, each of which, when so executed and delivered, will constitute an original and all of which together will constitute one instrument. Delivery of an executed copy of this Subscription Agreement by electronic facsimile transmission or other means of electronic communication capable of producing a printed copy will be deemed to be execution and delivery of this Subscription Agreement as of the date hereinafter set forth.

IN WITNESS WHEREOF the Investor has duly executed this Subscription Agreement as of the date of acceptance by the Company.

Y.M.Y Industry Ltd.
(Name of Investor)

/s/ Zvi Yemini
(Signature of Investor)

38 Yefet St., Tel Aviv-Yafo, Israel
(Address of Investor)

[Signature Page – Subscription Agreement April 2019]

A C C E P T A N C E

The above-mentioned Subscription Agreement in respect of the Shares is hereby accepted by TechCare Corp.

DATED this 28 ^th day of April, 2019

TechCare Corp.

By:	/s/ Tali Dinar
Name:	Tali Dinar
Title:	CFO

TECHCARE CORP.

(A Delaware corporation)

SUBSCRIPTION AGREEMENT

DATED: April 28, 2019 (the “Effective Date”)

1. The Subscription

1.1 On the basis of the representations and warranties and subject to the terms and conditions set forth in this Subscription Agreement, Traistman Radziejewski Fundacja Ltd . (Israeli Co. No. 514498856), of 15A Yahalom St., Shoham, Israel (C/O Oren Traistman) ( the “ Investor ”) hereby agrees to subscribe for and purchase 546,448 shares of common stock, par value $0.0001 (the “ Initial Shares ”) offered by TechCare Corp., a Delaware corporation with offices located at 1140 Avenue of the Americas, New York, NY 10036 (the “ Company ”), at a purchase price per share of US$ 0.183 (the “ Share Purchase Price ”), for an aggregate consideration of US$ 100,000 (the “ Subscription Proceeds ”), all pursuant to the terms and conditions set forth in this Subscription Agreement.

1.5 Subject to the terms hereof, the offer and sale of the Shares under this Subscription Agreement will be effective only upon receipt by the Company of the Subscription Proceeds.

1.6 Within seven (7) days of from the receipt of the Subscription Proceeds or the Additional Subscription Proceeds by the Company, as applicable, the Company shall deliver to the Investor book entry confirmation representing the number of Shares purchased by the Investor. The Shares shall be registered on the books of the Company as follows: Traistman Radziejewski Fundacja Ltd. (Israeli Co. No. 514498856), of 15A Yahalom St., Shoham, Israel (C/O Oren Traistman)