Risk Factors Update Summary

• Addition of material weakness disclosure and potential litigation risks due to restatement of financial statements.
• Reverse stock split of 15:1 on December 18, 2023, to regain compliance with Nasdaq's minimum bid price requirements.
• Inclusion of cybersecurity risks, protection measures, and oversight processes to safeguard against data breaches.
• Accumulated deficit increased from $385 million to $405 million, with a net loss rising from $18 million to $21 million.
• Sold 3,117,100 unregistered shares of common stock at an average price of approximately $1.44 per share.
• Enhanced focus on cybersecurity governance, risk assessment tools, and compliance with data protection laws.
• Cash and cash equivalents decreased from $18.3 million to $3.4 million.
• Identified a material weakness in internal control over financial reporting as of December 31, 2022.
• Increased risk of rescission rights and penalties, potentially requiring repayment of approximately $4,494,496.
• Issued 335,273 shares of 6% Convertible Exchangeable Preferred Stock, 119,745 shares of Series B Preferred Stock, and 264,358 shares.