What changed in this filing

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Item 1A. Risk Factors

2022-04-22 compared with 2021-03-31 · 193 added, 207 removed, 38 unchanged (91% of the section changed)

in our common stock involves risks.

In addition to the other information contained in this report, you should carefully consider

the following risks before deciding to purchase our common stock.

The occurrence of any of the following risks might cause you

to lose all or a part of your investment, and certain of these risks may be further exacerbated by the continuing impact of the

COVID-19 pandemic on the Company and our industry.

Some statements in this report, including statements in the following risk

factors, constitute forward-looking statements.

Please refer to “Cautionary Statement Regarding Forward-Looking Statements”

for more information regarding forward-looking statements.

In addition to the other information contained in this report, you should carefully consider the

following risks before deciding to purchase our common stock.

The occurrence of any of the following risks might cause you to lose all

or a part of your investment, and certain of these risks may be further exacerbated by the continuing impact of the COVID-19 pandemic

on the Company and our industry.

Some statements in this report, including statements in the following risk factors, constitute forward-looking

Please refer to “Cautionary Statement Regarding Forward-Looking Statements” for more information regarding forward-looking

have a history of losses.

incurred net losses of $1,351,619 and $1,421,740, respectively, for 2020 and 2019.

At December 31, 2019 we had an accumulated

deficit of $12,956,137.

While our revenues increased 53.5% for 2020 from 2019, and our gross profit margin increased from 15.1%

in 2019 to 32.1% in 2020, our gross profit is not sufficient to cover our operating expenses of $2,797,449 and $1,732,093,

respectively, which includes non-cash stock compensation expenses of $1,408,844 and $474,954 for the year

ending December 31, 2020 and 2019, respectively.

In 2020, our selling, general and administrative expenses, or “SG&A”,

increased 61.1% from 2019.

There are no assurances that we will be able to increase our revenues to a level which supports profitable

operations and provides sufficient capital to pay our operating expenses and other obligations as they become due.

incurred net losses of $1,588,467 and $1,351,619, respectively, for the year ended December 31, 2021 and 2020.

At December 31,

2021 we had an accumulated deficit of $14,544,604.

While our revenues increased 36.7% for the year ended December 31, 2021 from

2020, our gross profit margin decreased from 32.1% in 2020 to 30.3% in 2021, our gross profit is not sufficient to cover

our operating expenses in the year ended December 31, 2021 and 2020 of $3,742,262 and $2,797,449, respectively, which includes

non-cash stock compensation expenses of $1,154,801 and $858,695 for the years ending December 31, 2021 and 2020,

respectively.

In the year ended December 31, 2021, our selling, general and administrative expenses, increased 33.8% from 2020.

There are no assurances that we will be able to increase our revenues to a level which supports profitable operations and provides sufficient

capital to pay our operating expenses and other obligations as they become due.

auditors have raised substantial doubts as to our ability to continue as a going concern .

consolidated financial statements appearing later in this report have been prepared assuming we will continue as a going concern.

We have sustained recurring losses from operations and have used approximately $556,000 in net cash in our operation in

2020 as compared to approximately $510,000 in 2019.

These factors, among others, raise substantial doubt about our ability to

continue as a going concern.

Our consolidated financial statements do not include any adjustments that might result from the outcome

of this uncertainty.

independent registered public accounting firm has included an explanatory paragraph expressing substantial doubt relating to our ability

to continue as a going concern in its report on our audited consolidated financial statements for the year ended December 31, 2021 We

have sustained recurring losses from operations and have used approximately $769,500 in net cash in our operation in the year

ended December 31, 2021 as compared to approximately $556,000 in 2020.

These factors, among others, raise substantial doubt about

our ability to continue as a going concern.

Our consolidated financial statements do not include any adjustments that might result from

the outcome of this uncertainty.

Our principal sources of liquidity are sales of equity and debt securities.

In addition, in April 2020 we

obtained an unsecured $159,600 PPP Loan.

We do not have any firm commitments to raise additional working capital.

small company who stock is quoted on the OTC Markets, we expect to encounter difficulty in raising working capital upon terms

and conditions satisfactory to us, if at all.

We do not have any firm

commitments to raise additional working capital.

As we are a small company who stock is quoted on the OTC Markets, we expect to encounter

difficulty in raising working capital upon terms and conditions satisfactory to us, if at all.

If we are unable to obtain sufficient

funding or generate sufficient revenues, our business and results of operations will be adversely affected and we may be unable to continue

as a going concern.

rely on revenues from related parties.

discussed in detail later in this report, we generate revenues from sales to related parties, which accounted for 18.4%

of our net revenues in 2020 and 22.3% of our net revenues in 2019.

The loss of revenues from these related parties would have

a material adverse impact on our business, results of operations and financial condition in future periods.

we fail to maintain an effective system of internal control over financial reporting, we may not be able to accurately report

our financial results.

As a result, current and potential shareholders could lose confidence in our financial reporting, which

would harm our business and the trading price of our stock.

generate revenues from sales to related parties, which accounted for 17.9% of our net revenues in 2021 and 18.4% of our net revenues

The loss of revenues from these related parties would have a material adverse impact on our business, results of operations

and financial condition in future periods.

depend on licenses with Robert Carmichael, our Chief Executive Officer’s ownership interests in much of our intellectual property.

Company either owns or has licensed from entities in which Robert Carmichael, our Chairman, has an ownership interest, the following

registered and unregistered trade names, trademarks and service marks:

Brownie’s Third Lung™, browniedive.com, Brownie’s,

Brownie’s Third Lung oval symbol, browniedive, YachtPro.

we fail to maintain an effective system of internal control over financial reporting, we may not be able to accurately report our financial

As a result, current and potential shareholders could lose confidence in our financial reporting, which would harm our business

and the trading price of our stock.

management has previously determined that we did not maintain effective internal controls over financial reporting.

For a detailed

description of these material weaknesses and our remediation efforts and plans, see “Part II —

Item 9A —

and Procedures.”

If the result of our remediation of the identified material weaknesses is not successful, or if additional

material weaknesses are identified in our internal control over financial reporting, our management will be unable to report favorably

as to the effectiveness of our internal control over financial reporting and/or our disclosure controls and procedures, and we

could be required to further implement expensive and time-consuming remedial measures and potentially lose investor confidence

in the accuracy and completeness of our financial reports which could have an adverse effect on our stock price and potentially

subject us to litigation.

For a detailed description

of these material weaknesses and our remediation efforts and plans, see Part II, Item 9A-Controls and Procedures of this Annual Report.

If the result of our remediation of the identified material weaknesses is not successful, or if additional material weaknesses are identified

in our internal control over financial reporting, our management will be unable to report favorably as to the effectiveness of our internal

control over financial reporting and/or our disclosure controls and procedures, and we could be required to further implement expensive

and time-consuming remedial measures and potentially lose investor confidence in the accuracy and completeness of our financial reports

which could have an adverse effect on our stock price and potentially subject us to litigation.

AND OPERATIONAL RISKS

are dependent upon certain key members of management.

success will depend to a significant degree on the abilities and efforts of our senior management.

Moreover, our success depends

on our ability to attract, retain and motivate qualified management, marketing, technical and sales personnel.

These people are

in high demand and often have competing employment opportunities.

The labor market for skilled employees is highly competitive

and we may lose key employees or be forced to increase their compensation to retain these people.

Employee turnover could significantly

increase our recruitment, training and other related employee costs.

The loss of key personnel, or the failure to attract qualified

personnel, could have a material adverse effect on our business, financial condition or results of operations.

require additional personnel and could fail to attract or retain key personnel.

continued growth depends on our ability to attract and retain

an experienced Chief Financial Officer, and additional skilled associates.

We are currently utilizing the services of two

professional consultants to assist our Chief Executive Officer and Chief Financial Officer with finance and operations.

The loss of the services of these consultants prior to our ability to attract and retain an experienced Chief Financial

Officer or further assistance in these areas may have a material adverse effect upon us.

Also, there can be no assurance that

we will be able to retain our existing personnel or attract additional qualified associates in the future.

are dependent upon certain key members of management and qualified employees and consultants.

success depends to a significant degree on the abilities and efforts of our senior management.

and on our ability to attract, retain

and motivate highly qualified marketing, technical, engineering and sales personnel and consultants.

These people are in high demand

and often have competing employment opportunities.

The labor market for skilled employees is highly competitive and we may lose key employees

or be forced to increase their compensation to retain these people.

Employee turnover could significantly increase our recruitment, training

and other related employee costs.

The loss of key personnel, or the failure to attract qualified personnel, could result in delays in

development or fulfillment of any current strategic and operational plans and have a material adverse effect on our business, financial

condition or results of operations.

failure to obtain and enforce intellectual property protection may have a material adverse effect on our business.

success depends in part on our ability, and the ability of our patent and trademark licensors, entities owned and controlled by

Carmichael to obtain and defend our intellectual property, including patent protection for our products and processes,

preserve our trade secrets, defend and enforce our rights against infringement and operate without infringing the proprietary

rights of third parties, both in the United States and in other countries.

Despite our efforts to protect our intellectual proprietary

rights, existing copyright, trademark and trade secret laws afford only limited protection.

success depends in part on our ability, and the ability of our patent and trademark licensors, and entities owned and controlled by Robert

Carmichael to obtain and defend our intellectual property, including patent protection for our products and processes, preserve our trade

secrets, defend and enforce our rights against infringement and operate without infringing the proprietary rights of third parties, both

in the United States and in other countries.

Despite our efforts to protect our intellectual proprietary rights, existing copyright,

trademark and trade secret laws afford only limited protection.

industry is characterized by frequent intellectual property litigation based on allegations of infringement of intellectual property

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supply or pricing.

In addition, we have no long-term contracts with our manufacturing sources and compete with other companies

for production facility capacity.

Historically, we have purchased enough inventories of products or their substitutes to satisfy

However, unanticipated failure of any manufacturer or supplier to meet our requirements or our inability to build or obtain

substitutes could force us to curtail or cease operations.

In addition, we have no long-term contracts with our manufacturing sources and compete with other companies for production

facility capacity.

Historically, we have purchased enough inventories of products or their substitutes to satisfy demand.

However, unanticipated

failure of any manufacturer or supplier to meet our requirements or our inability to build or obtain substitutes could force us to curtail

or cease operations.

Certain of our product components are manufactured in China.

experienced delays and also expect continued delays in our supply chain, including component products, which are manufactured

Due to Covid, and the logistics challenges existing

currently, we have experienced delays and may experience continued delays in our supply chain, including component products, which are

manufactured in China.

Our senior management will continue to monitor our situation on a daily basis, however, we expect that these factors

and others we have yet to experience will materially adversely impact our company, its business and operations for the foreseeable

and others we have yet to experience may materially adversely impact our company, its business and operations for the foreseeable future.

dependent on consumer discretionary spending.

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conditions affecting disposable consumer income such as employment, business conditions, tax rates, and interest rates.

of economic uncertainty, consumers tend to defer expenditures for discretionary items, which effects demand for our products.

Any significant deterioration in overall economic conditions that diminishes consumer confidence or discretionary income can reduce

our sales and adversely affect our financial results.

In times of economic

uncertainty, consumers tend to defer expenditures for discretionary items, which effects demand for our products.

Any significant deterioration

in overall economic conditions that diminishes consumer confidence or discretionary income can reduce our sales and adversely affect

our financial results.

The impact of weakening consumer credit markets;

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higher fuel prices;

declines in the value of investments and residential real estate;

and increases in federal and state taxation

can all negatively affect our results.

There can be no assurance that in this type of environment consumer spending will not decline,

thereby adversely affecting our growth, net sales and profitability or that our business will not be adversely affected by continuing

or future downturns in the economy, boating industry, or dive industry.

If declines in consumer spending on recreational marine

accessories and dive gear are other than temporary, we could be forced to curtail or cease operations.

in the value of investments and residential real estate;

and increases in federal and state taxation can all negatively affect our results.

There can be no assurance that in this type of environment consumer spending will not decline, thereby adversely affecting our growth,

net sales and profitability or that our business will not be adversely affected by continuing or future downturns in the economy, boating

industry, or dive industry.

If declines in consumer spending on recreational marine accessories and dive gear are other than temporary,

we could be forced to curtail or cease operations.

regulations may impact us.

SCUBA industry is self-regulating;

therefore, Brownie’s is not subject to government industry specific regulation.

Nevertheless,

Brownie’s strives to be a leader in promoting safe diving practices within the industry and is at the forefront of self-regulation

through responsible diving practices.

Brownie’s is subject to all regulations applicable to “for profit”

as well as all trade and general commerce governmental regulation.

All required federal and state permits, licenses, and bonds

to operate its facility have been obtained.

SCUBA industry is self-regulating, therefore, from an industry perspective the Company is not subject to government industry specific

However, our tank manufacturing operation is required to comply with DOT, as well as being approved to sell in various countries

outside of the United States.

The Company strives to be a leader in promoting safe diving practices within the industry and is at the

forefront of self-regulation through responsible diving practices.

The Company is subject to all regulations applicable to “for

profit” companies as well as all trade and general commerce governmental regulation.

All required federal and state permits, licenses,

and bonds to operate its facility have been obtained.

There can be no assurance that our operations will not be subject to more restrictive

regulations in the future, which could force us to curtail or cease operations.

failure to adequately protect personal information could have a material adverse effect on our business.

wide variety of local, state, national, and international laws, directives and regulations apply to the collection, use, retention,

protection, disclosure, transfer, and other processing of personal data (including with respect to the European Union’s

General Data Protection Regulation and U.S.

failure to adequately protect personal information that is collected on our website and our third-party payment platforms could have

a material adverse effect on our business.

wide variety of local, state, national, and international laws, directives and regulations apply to the collection, use, retention, protection,

disclosure, transfer, and other processing of personal data (including with respect to the European Union’s General Data Protection

Regulation and U.S.

state laws such as the California Consumer Privacy Act).

These data protection and

privacy-related laws and regulations continue to evolve and may result in ever-increasing regulatory and public scrutiny and escalating

levels of enforcement and sanctions and increased costs of compliance.

Our failure to comply with applicable laws and regulations,

or to protect such data, could result in enforcement actions against us, including fines, imprisonment of company officials and

public censure, claims for damages by end-customers and other affected individuals, damage to our reputation and loss of goodwill

(both in relation to existing end-customers and prospective end-customers), any of which could have a material adverse effect

on our operations, financial performance, and business.

Changing definitions of personal data and personal information, within

the European Union, the United States, and elsewhere may limit or inhibit our ability to operate or expand our business, including

limiting strategic partnerships that may involve the sharing of data.

The evolving data protection regulatory environment may

require significant management attention and financial resources to analyze and modify our information technology infrastructure

to meet these changing requirements all of which could reduce our operating margins and impact our operating results and financial

These data protection and privacy-related laws and regulations

continue to evolve and may result in ever-increasing regulatory and public scrutiny and escalating levels of enforcement and sanctions

and increased costs of compliance.

Our failure to comply with applicable laws and regulations, or to protect such data, could result

in enforcement actions against us, including fines, imprisonment of company officials and public censure, claims for damages by end-customers

and other affected individuals, damage to our reputation and loss of goodwill (both in relation to existing end-customers and prospective

end-customers), any of which could have a material adverse effect on our operations, financial performance, and business.

Changing definitions

of personal data and personal information, within the European Union, the United States, and elsewhere may limit or inhibit our ability

to operate or expand our business, including limiting strategic partnerships that may involve the sharing of data.

The evolving data

protection regulatory environment may require significant management attention and financial resources to analyze and modify our information

technology infrastructure to meet these changing requirements all of which could reduce our operating margins and impact our operating

results and financial condition.

weather could have an adverse effect on operating results.

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rough surf, may decrease boat use and diving, thereby decreasing sales.

Accordingly, our results of operations for any prior period

may not be indicative of results of any future period.

Accordingly, our results of operations for any prior period may

not be indicative of results of any future period.

manufacture and distribution of recreational diving equipment could result in product liability claims.

like any other retailer, distributor and manufacturer of products that are designed for recreational sporting purposes, face an

inherent risk of exposure to product liability claims in the event that the use of our products results in injury.

may include, among other things, that our products are designed and/or manufactured improperly or fail to include adequate instructions

as to proper use and/or side effects, if any.

We do not anticipate obtaining contractual indemnification from parties supplying

raw materials , manufacturing our products or marketing our products.

In any event, any such indemnification if obtained

will be limited by our terms and, as a practical matter, to the creditworthiness of the indemnifying party.

In the event that

we do not have adequate insurance or contractual indemnification, product liabilities relating to defective products could have

a material adverse effect on our operations and financial conditions, which could force us to curtail or cease our business operations.

like any other retailer, distributor and manufacturer of products that are designed for recreational sporting purposes, face an inherent

risk of exposure to product liability claims in the event that the use of our products results in injury.

Such claims may include, among

other things, that our products are designed and/or manufactured improperly or fail to include adequate instructions as to proper use

and/or side effects, if any.

We do not obtain indemnification from parties supplying raw materials , manufacturing our products

or marketing our products.

In the event that we do not have adequate insurance or contractual indemnification, product liabilities relating

to defective products could have a material adverse effect on our operations and financial conditions, which could force us to curtail

or cease our business operations.

worldwide impact from the COVID-19 pandemic may negatively impact our business.

we have been relatively successful in navigating such impact to date, we have previously been affected by temporary manufacturing

closures, and employment and compensation adjustments.

There are also ongoing related risks to our business depending on the progression

of the pandemic, and recent trends in certain regions have indicated potential returns to limited or closed government functions,

business activities and person-to-person interactions.

Global trade conditions and consumer trends may further adversely impact

us and our industries.

For example, pandemic-related issues have exacerbated port congestion and intermittent supplier shutdowns

and delays, resulting in additional expenses to expedite delivery of critical parts.

Similarly, increased demand for personal

electronics has created a shortfall of microchip supply, and it is yet unknown how we may be impacted.

We cannot predict the duration

or direction of current global trends from this pandemic, the sustained impact of which is largely unknown, is rapidly evolving

and has varied across geographic regions.

Ultimately, we continue to monitor macroeconomic conditions to remain flexible and to

optimize and evolve our business as appropriate, and we will have to accurately project demand and infrastructure requirements

globally and deploy our production, workforce and other resources accordingly.

issuance of shares of our common stock upon conversion of outstanding 6% secured convertible notes may cause immediate and substantial

dilution to our existing shareholders.

We may not have sufficient funds to repay the notes at maturity.

presently have $100,000 principal amount of 6% secured convertible notes outstanding which were originally issued in 2017.

securities are convertible at the option of the holders in shares of our common stock at a conversion price of $0.01.

of shares of our common stock upon any conversion of the 6% secured convertible notes will result in dilution to the interests

of other shareholders.

In addition, these notes mature on December 31, 2021.

There are no assurances we will have sufficient

funds available to satisfy the notes at maturity, or that one or both of the holders will elect to convert the notes into shares

of our common stock.

Each of these notes are secured by an amount of our assets sufficient to satisfy the obligations under the

If we were to default under the repayment of the note, the noteholder could seek to foreclose on a portion of our assets

which would materially adversely impact our business as it is currently conducted.

issuance of shares of our common stock upon exercise of our outstanding options may cause immediate and substantial

dilution to our existing shareholders.

presently have vested and unvested options that if exercised

would result in the issuance of an additional 199,730,020 shares of our common stock.

The issuance of shares upon exercise

of options will result in dilution to the interests of other shareholders.

we have been relatively successful in navigating such impact to date, we have previously been affected by temporary manufacturing closures,

and employment and compensation adjustments.

There are also ongoing related risks to our business depending on the progression of the

pandemic, and recent trends in certain regions have indicated potential returns to limited or closed government functions, business activities

and person-to-person interactions.

Global trade conditions and consumer trends may further adversely impact us and our industries.

example, pandemic-related issues have exacerbated port congestion and intermittent supplier shutdowns and delays, resulting in additional

expenses to expedite delivery of critical parts.

Similarly, increased demand for personal electronics has created a shortfall of microchip

supply, and it is yet unknown how we may be impacted.

We cannot predict the duration or direction of current global trends from this

pandemic, the sustained impact of which is largely unknown, is rapidly evolving and has varied across geographic regions.

we continue to monitor macroeconomic conditions to remain flexible and to optimize and evolve our business as appropriate, and we will

have to accurately project demand and infrastructure requirements globally and deploy our production, workforce and other resources accordingly.

issuance of shares of our common stock upon exercise of our outstanding options, warrants, convertible debt and Series A Convertible

Preferred Stock may cause immediate and substantial dilution to our existing shareholders.

presently have vested and unvested options, warrants, convertible debt and Series A Convertible Preferred Stock that if exercised would

result in the issuance of an additional 254,577,924 shares of our common stock.

The issuance of shares upon exercise of options

will result in dilution to the interests of other shareholders.

common stock may be affected by limited trading volume and may fluctuate significantly.

common stock is quoted on the OTCQB tier of the OTC Markets.

There is a limited public market for our common stock and there

can be no assurance that an active trading market for our common stock will develop.

As a result, this could adversely affect our

shareholders’

There is a limited public market for our common stock and there can be no

assurance that an active trading market for our common stock will develop.

As a result, this could adversely affect our shareholders’

ability to sell our common stock in short time periods, or possibly at all.

Thinly traded common stock can be

more volatile than common stock traded in an active public market.

Our common stock has experienced, and is likely to experience in

the future, significant price and volume fluctuations, which could adversely affect the market price of our common stock without

regard to our operating performance.

In addition, we believe that factors such as quarterly fluctuations in our financial results

and changes in the overall economy or the condition of the financial markets could cause the price of our common stock to fluctuate

substantially.

company is a voluntary filer with the Securities and Exchange Commission and in the event that we cease reporting under the Exchange

Act, investors would have limited information available to them about the company.

we are voluntarily file reports with the SEC under Section 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange

Act”), we do not have a class of securities registered under Section 12(g) of the Exchange Act.

To the extent that our duty

to file Exchange Act reports has automatically suspended under Section 15(d) of the Exchange Act, as a voluntary filer, we may

elect to cease reporting under the Exchange Act at such time which would limit the information available to investors and shareholders

about the company.

common stock is deemed to be “penny stock,”

which may make it more difficult for investors to sell their shares due

to suitability requirements.

common stock is deemed to be “penny stock”

as that term is defined under the Exchange Act .

Penny stocks generally

are equity securities with a price of less than $5.00 (other than securities registered on certain national securities exchanges.

Our common stock is covered by an SEC rule that imposes additional sales practice requirements on broker-dealers who sell such

securities to persons other than established customers and accredited investors, which are generally institutions with assets

in excess of $5,000,000, or individuals with net worth in excess of $1,000,000 or annual income exceeding $200,000 or $300,000

jointly with their spouse.

Thinly traded common stock can be more volatile than common

stock traded in an active public market.

Our common stock has experienced, and is likely to experience in the future, significant price

and volume fluctuations, which could adversely affect the market price of our common stock without regard to our operating performance.

In addition, we believe that factors such as quarterly fluctuations in our financial results and changes in the overall economy or the

condition of the financial markets could cause the price of our common stock to fluctuate substantially.

company is a voluntary filer with the SEC and in the event that we cease reporting under the Exchange Act, investors would have limited

information available to them about the company.

we are voluntarily file reports with the SEC under Section 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange

Act”), we do not have a class of securities registered under Section 12(g) of the Exchange Act.

To the extent that our duty to

file Exchange Act reports has automatically suspended under Section 15(d) of the Exchange Act, as a voluntary filer, we may elect to

cease reporting under the Exchange Act at such time which would limit the information available to investors and shareholders about the

common stock is deemed to be “penny stock,” which may make it more difficult for investors to sell their shares due to suitability

requirements.

common stock is deemed to be “penny stock” as that term is defined under the Exchange Act.

Penny stocks generally are equity

securities with a price of less than $5.00 (other than securities registered on certain national securities exchanges.

Our common stock

is covered by an SEC rule that imposes additional sales practice requirements on broker-dealers who sell such securities to persons other

than established customers and accredited investors, which are generally institutions with assets in excess of $5,000,000, or individuals

with net worth in excess of $1,000,000 or annual income exceeding $200,000 or $300,000 jointly with their spouse.

Broker/dealers

dealing in penny stocks are required to provide potential investors with a document disclosing the risks of penny stocks.

broker/dealers are required to determine whether an investment in a penny stock is a suitable investment for a prospective investor.

These requirements may reduce the potential market for our common stock by reducing the number of potential investors.

make it more difficult for investors in our common stock to sell shares to third parties or to otherwise dispose of them.

could cause our stock price to decline.

Moreover, broker/dealers

are required to determine whether an investment in a penny stock is a suitable investment for a prospective investor.

These requirements

may reduce the potential market for our common stock by reducing the number of potential investors.

This may make it more difficult for

investors in our common stock to sell shares to third parties or to otherwise dispose of them.

This could cause our stock price to decline.

officers and directors are able to control the Company.

officers and directors and their affiliates own or have the right to vote a majority of the common stock of our company.

they have significant influence over the management and affairs of the Company and control over matters requiring stockholder approval,

including the election of directors and significant corporate transactions, such as a merger or other sale of our company or our assets.

Their interests may differ from the interests of other shareholders and thus result in corporate decisions that are disadvantageous to

other shareholders.

This concentration of ownership and influence in management and board decision-making could also harm the price of

our capital stock by, among other things, discouraging a potential acquirer from seeking to acquire shares of our capital stock (whether

by making a tender offer or otherwise) or otherwise attempting to obtain control of our company.

Staff Comments

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors