Risk Factors Update Summary

• Addition of new data protection laws in various states and at the federal level may increase compliance costs.
• The CPRA and other similar laws may impact business activities, potentially leading to increased privacy enforcement.
• Accumulated deficit increased from $438 million to $572 million, with losses continuing to rise.
• Reduction in full-time employees from 80 to 71, impacting operations and resource allocation.
• Federal NOLs decreased from $286 million to $321 million, with state and local NOLs decreasing from $36 million to $71 million.
• The California Privacy Rights Act (CPRA) significantly amends the CCPA, imposing additional data protection obligations.
• The EU and UK GDPR impose complex compliance burdens and potential fines for noncompliance, up to €20 million.
• Failure to comply with GDPR and UK GDPR could result in significant penalties and affect compliance with contracts.
• Cash and cash equivalents increased from approximately $242.7 million to $259 million.
• Sales of common stock totaling approximately $48 million as of December 31, 2023.
• The CPRA introduces new regulatory California data protection agency and audit requirements for higher risk data.
• The EU and UK GDPR restrict data transfers, with potential consequences for noncompliance, including substantial fines.
• Capital resources expected to fund operations into mid-2026, requiring additional financing thereafter.
• Number of shares outstanding decreased from 47,722,369 to 40,696,492 as of December 31, 2023.