The Company is including the
below update to its risk factors, for the purpose of supplementing and updating the disclosure contained in its Annual Report on Form
10-K for the fiscal year ended December 31, 2021, filed with the Securities and Exchange Commission (the “SEC”) on March 31,
2022 (as amended on Form 10-K/A filed with the SEC on May 10, 2022) and its Quarterly Report on Form 10-Q for the period ended March 31,
2022, filed with the SEC on May 23, 2022.
Our failure to maintain
compliance with Nasdaq’s continued listing requirements could result in the delisting of our Common Stock.
Our common stock is currently
listed for trading on The Nasdaq Capital Market. We must satisfy The Nasdaq Capital Market’s continued listing requirements, including,
among other things, a minimum stockholders’ equity of $2.5 million and a minimum bid price requirement of $1.00 per share
or risk delisting, which would have a material adverse effect on our business. A delisting of our common stock from The Nasdaq Capital
Market could materially reduce the liquidity of our common stock and result in a corresponding material reduction in the price of our
common stock. In addition, delisting could harm our ability to raise capital through alternative financing sources on terms acceptable
to us, or at all, and may result in the potential loss of confidence by investors, suppliers, customers and employees and fewer business
development opportunities.
On November 26, 2021, we received
notice from the Listing Qualifications Staff of Nasdaq indicating that we were not in compliance with the minimum stockholders’
equity requirement for continued listing on The Nasdaq Capital Market, under Listing Rule 5550(b)(1) (the “Minimum Stockholders’
Equity Rule”) because our stockholders’ equity of $(6,969,988) as reported in our Quarterly Report on Form 10-Q for the period
ended September 30, 2021 was below the required minimum of $2.5 million, and because, as of November 24, 2021, we did not meet the alternative
compliance standards, relating to the market value of listed securities of $35 million or net income from continuing operations of $500,000
in the most recently completed fiscal year or in two of the last three most recently completed fiscal years.
On January 10, 2022, we submitted
to Nasdaq a plan to regain compliance with the Minimum Stockholders’ Equity Rule. On February 15, 2022, Nasdaq notified us that
they have granted us an extension of up to 180 calendar days from November 26, 2021, or through May 25, 2022, to regain compliance. On
May 26, 2022, we received a letter from the Listing Qualifications Staff of Nasdaq indicating that, based upon the Company’s continued
non-compliance with the Minimum Stockholders’ Equity Rule, the Staff had determined to delist the Company’s securities from
Nasdaq unless the Company timely requests a hearing before the Nasdaq Hearings Panel (the “Panel”). We intend to timely request
a hearing before the Panel, at which hearing we will request an extension within which to evidence compliance with all applicable requirements
for continued listing on Nasdaq, including compliance with the Minimum Stockholders’ Equity Rule. Our request for a hearing will
stay any suspension or delisting action by the Staff pending the hearing and the expiration of any additional extension period granted
by the Panel following the hearing. We intend to continue to take definitive steps in an effort to evidence compliance with the Minimum
Stockholders’ Equity Rule; however, there can be no assurance that the Panel will grant our request for continued listing or that
we will be able to evidence compliance with the Minimum Stockholders’ Equity Rule within any extension period that may be granted
by the Panel.
Additionally, on May 16, 2022,
we received notice from the Listing Qualifications Staff of Nasdaq indicating that, based upon the closing bid price of our common stock
for the prior 30 consecutive business days, we were not in compliance with the requirement to maintain a minimum bid price of $1.00 per
share for continued listing on Nasdaq as set forth In Nasdaq Listing Rule 5550(a)(2). We will have 180 days from May 16, 2022, or through
November 14, 2022, to regain compliance. If we do not regain compliance during the compliance period ending November 14, 2022, then Nasdaq
may grant us a second 180 calendar day period to regain compliance, provided we meet the continued listing requirement for market value
of publicly-held shares and all other initial listing standards for The Nasdaq Capital Market, other than the minimum closing bid price
requirement, and notify Nasdaq of our intent to cure the deficiency. If we do not regain compliance within the allotted compliance periods,
including any extensions that may be granted by Nasdaq, we may be subject to delisting. If Nasdaq determines to delist our common stock,
we will have the right to appeal to a Nasdaq hearing panel.
If our common stock were delisted
from Nasdaq, trading of our common stock would most likely take place on an over-the-counter market established for unlisted securities,
such as the OTCQB or the Pink Market maintained by OTC Markets Group Inc. An investor would likely find it less convenient to sell, or
to obtain accurate quotations in seeking to buy, our common stock on an over-the-counter market, and many investors would likely not buy
or sell our common stock due to difficulty in accessing over-the-counter markets, policies preventing them from trading in securities
not listed on a national exchange or other reasons. In addition, as a delisted security, our common stock would be subject to SEC rules
as a “penny stock,” which impose additional disclosure requirements on broker-dealers. The regulations relating to penny stocks,
coupled with the typically higher cost per trade to the investor of penny stocks due to factors such as broker commissions generally representing
a higher percentage of the price of a penny stock than of a higher-priced stock, would further limit the ability of investors to trade
in our common stock. In addition, delisting could harm our ability to raise capital through alternative financing sources on terms acceptable
to us, or at all, and may result in the potential loss of confidence by investors, suppliers, customers and employees and fewer business
development opportunities. For these reasons and others, delisting would adversely affect the liquidity, trading volume and price of our
common stock, causing the value of an investment in us to decrease and having an adverse effect on our business, financial condition and
results of operations, including our ability to attract and retain qualified employees and to raise capital.