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Item 9A. Controls and Procedures

2022-03-23 compared with 2021-03-23 · 204 added, 221 removed, 47 unchanged (90% of the section changed)

CONTROLS AND PROCEDURES

of Disclosure Controls and Procedures

controls are procedures that are designed with the objective of ensuring that information required to be disclosed in our reports

filed under the Exchange Act, such as this Annual Report on Form 10-K, is recorded, processed, summarized and reported within

the time periods specified in the SEC’s rules and forms.

Disclosure controls are also designed with the objective of ensuring

that such information is accumulated and communicated to our management, including the Principal Executive Officer and Principal

Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

Internal controls are procedures which

are designed with the objective of providing reasonable assurance that (1) our transactions are properly authorized, recorded

and reported;

and (2) our assets are safeguarded against unauthorized or improper use, to permit the preparation of our consolidated

financial statements in conformity with GAAP.

controls are procedures that are designed with the objective of ensuring that information required to be disclosed in our reports filed

under the Exchange Act, such as this Annual Report on Form 10-K, is recorded, processed, summarized and reported within the time periods

specified in the SEC’s rules and forms.

Disclosure controls are also designed with the objective of ensuring that such information

is accumulated and communicated to our management, including the Principal Executive Officer and Principal Financial Officer, as appropriate,

to allow timely decisions regarding required disclosure.

Internal controls are procedures which are designed with the objective of providing

reasonable assurance that (1) our transactions are properly authorized, recorded and reported;

and (2) our assets are safeguarded against

unauthorized or improper use, to permit the preparation of our consolidated financial statements in conformity with GAAP.

management, including our chief executive officer and chief financial officer, evaluated the effectiveness of our disclosure controls

and procedures (as defined in Rules 13a-15(e) or 15d-15(e) under the Exchange Act) as of the end of the period covered by this

and procedures (as defined in Rules 13a-15(e) or 15d-15(e) under the Exchange Act) as of the end of the period covered by this report.

There are inherent limitations to the effectiveness of any system of disclosure controls and procedures.

and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well

designed and operated, can provide only reasonable assurance of achieving the desired control objectives.

on the evaluation as of December 31, 2020, for the reasons set forth below, our chief executive officer and chief financial officer

concluded that our disclosure controls and procedures were not effective to provide reasonable assurance that information we are

required to disclose in reports that we file or submit under the Exchange Act 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 chief executive officer and chief financial officer, as appropriate, to allow timely decisions

regarding required disclosure.

Management’s

Annual Report on Internal Control Over Financial Repor ting.

Our management is responsible for establishing

and maintaining adequate internal control over financial reporting (as defined in Rules 13a-15(f) or 15d-15(f) under the Exchange

Our internal control system was designed to, in general, provide reasonable assurance to our management and the Board of

Directors regarding the preparation and fair presentation of published financial statements, but because of its inherent limitations,

internal control over financial reporting may not prevent or detect misstatements.

In designing and evaluating

the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated,

can provide only reasonable assurance of achieving the desired control objectives.

Based on the evaluation as of December 31, 2021,

for the reasons set forth below, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures

were effective to provide reasonable assurance that information we are required to disclose in reports that we file or submit under the

Exchange Act 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 chief executive officer and chief financial officer,

as appropriate, to allow timely decisions regarding required disclosure.

Annual Report on Internal Control Over Financial Reporting.

management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rules 13a-15(f)

or 15d-15(f) under the Exchange Act).

Our internal control system was designed to, in general, provide reasonable assurance to our management

and the Board of Directors regarding the preparation and fair presentation of published financial statements, but because of its inherent

limitations, internal control over financial reporting may not prevent or detect misstatements.

Our chief executive officer and chief financial

officer evaluated the effectiveness of our internal control over financial reporting as of December 31, 2020, and based on that

evaluation they concluded that our internal control over financial reporting was not effective.

The framework used by management in making

that assessment was the criteria set forth in the document entitled “Internal Control –

Integrated Framework”

issued by the Committee of Sponsoring Organizations of the Treadway Commission in 2013.

A material weakness is a deficiency, or

a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a

material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely

In its assessment of the effectiveness of internal control our financial reporting as of December 31, 2020, the Company

determined that the following item constituted a material weakness:

The Company does not have adequate controls related to change management

within the technology that support the Company’s financial reporting function.

During the year ended December 31, 2020, the

Company made significant improvements to its key process related to change management around technology support.

However, the Company

determined that the residual risk remaining still caused the material weakness to exist.

Accordingly, the Company intends to remediate

the material weakness for the year ending December 31, 2021.

Changes in Internal Control over

Financial Reporting

We have implemented changes in our internal

control over financial reporting (as defined in Rules 13a-15(f) or 15d-15(f) under the Exchange Act) during the year ended December

31, 2020, related to general information technology controls in the area of change management in order to remediate the material

weakness identified above.

However, the Company determined that the residual risk remaining still caused the material weakness

Accordingly, the Company intends to remediate the material weakness for the year ending December 31, 2021.

There were no other changes in our internal

control over financial reporting during the quarter ended December 31, 2020 (as defined in Rules 13a-15(f) or 15d-15(f) under the

Exchange Act) that have materially affected, or are reasonably likely to materially affect, our internal control over financial

officer evaluated the effectiveness of our internal control over financial reporting as of December 31, 2021, and based on that evaluation,

management concluded that our internal control over financial reporting was effective.

Therefore, our management, including our chief

executive officer and chief financial officer, have concluded that our disclosure controls and procedures were effective to provide reasonable

assurance that the information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act

of 1934, as amended, is accumulated and communicated to the Company’s management to allow timely decisions regarding required disclosures.

The framework used by management in making that

assessment was the criteria set forth in the document entitled “Internal Control – Integrated Framework” issued by the

Committee of Sponsoring Organizations of the Treadway Commission in 2013.

Remediation of Previously Disclosed Material Weakness

As previously disclosed in our Annual Report on Form 10-K for the fiscal

year ended December 31, 2020, the assessment of our internal control over financial reporting determined that a material weakness in our

internal controls existed as of December 31, 2020, due to the lack of controls related to change management within the technology that

supported the Company’s financial reporting function.

Measures were taken to remediate the material weakness, and we made significant

improvements to our key process related to change management around technology support.

We concluded this reported material weakness was

remediated as of December 31, 2021.

in Internal Control over Financial Reporting

have implemented changes in our internal control over financial reporting (as defined in Rules 13a-15(f) or 15d-15(f) under the Exchange

Act) during the year ended December 31, 2021, related to general information technology controls in the area of change management in

order to remediate the material weakness identified in the year ended December 31, 2020.

There were no other changes in our internal control

over financial reporting during the quarter ended December 31, 2021 (as defined in Rules 13a-15(f) or 15d-15(f) under the Exchange Act)

that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

OTHER INFORMATION

Officer Employment Agreements

On March 23, 2022, the Company entered into

an Amended and Restated Employment Agreement with Jason Katz, the Company’s Chief Executive Officer (the “Katz Employment

Agreement”), which amends and restates Mr.

Katz’s existing employment agreement with the Company dated as of October 7, 2016.

In addition, on March 23, 2022, the Company entered into an Amended and Restated Employment Agreement with Kara Jenny, the Company’s

Chief Financial Officer (the “Jenny Employment Agreement”), which amends and restates Ms.

Jenny’s existing employment

with the Company dated as of December 9, 2019.

Except as provided herein, all other terms and conditions of the prior employment agreements

between the Company and each of Ms.

Jenny and Mr.

Katz will remain in full force and effect.

Pursuant to the Katz Employment Agreement,

and as previously disclosed in the Company’s Definitive Proxy Statement filed with the SEC on April 9, 2021, effective February

Katz shall receive an annualized base salary of two hundred twenty-five thousand dollars ($225,000).

The foregoing description

of the Katz Employment Agreement is qualified in its entirety by reference to the full text of the Katz Employment Agreement, which is

filed as Exhibit 10.15 to this Annual Report on Form 10-K and is incorporated by reference herein.

Pursuant to the Jenny Employment Agreement,

for fiscal year 2022, Ms.

Jenny is entitled to receive an annualized base salary of two hundred sixty-five thousand dollars ($265,000),

effective retroactively as of January 28, 2022.

For fiscal year 2023, provided that Ms.

Jenny is still employed and in good standing with

the Company, she will be entitled to receive an annualized base salary of two hundred eighty-five thousand dollars ($285,000).

In addition, the Jenny Employment Agreement provides

that in the event of a Change in Control, if Ms.

Jenny is terminated by the Company other than for Cause, or if Ms.

Jenny terminates her

employment with the Company for Good Reason, then the Company shall pay Ms.

Jenny severance equal to twelve (12) months of Ms.

then-current annualized base salary (each such capitalized term as defined in the Jenny Employment Agreement).

The foregoing description

of the Jenny Employment Agreement is qualified in its entirety by reference to the full text of the Jenny Employment Agreement, which

is filed as Exhibit 10.21 to this Annual Report on Form 10-K and is incorporated by reference herein.

Stock Repurchase Plan

On March 21, 2022, the Board of Directors of the

Company approved a stock repurchase plan for up to $1,750,000 of the Company’s outstanding common stock (the “Stock Repurchase

The Stock Repurchase Plan is effective as of March 29, 2022 and expires on the one-year anniversary of such date.

may be repurchased from time-to-time in open market transactions at prevailing market prices, in privately negotiated transactions or

by other means in accordance with federal securities laws, including Rule 10b5-1 programs, and the Stock Repurchase Plan may be suspended

or discontinued at any time.

The actual timing, number and value of shares repurchased will be determined by a committee of the Board

of Directors at its discretion and will depend on a number of factors, including the market price of the Company’s common stock,

general market and economic conditions, alternative investment opportunities and other corporate considerations.

DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT

Not applicable.

DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE