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 UNITED
STATES

 SECURITIES
AND EXCHANGE COMMISSION

 WASHINGTON,
D.C. 20549

 FORM

 (Mark
One)

 ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 For
the fiscal year ended December 31, 2023

 or

 TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 For
the transition period from _______________ to ________________

 Commission
file number 001-41227

 CISO
GLOBAL, INC.

 (Exact
name of registrant as specified in its charter)

 Delaware

 83-4210278

 State
 or Other Jurisdiction of

 (I.R.S.
 Employer

 Incorporation or Organization

 Identification
 No.)

 6900
E. Camelback Road, Suite 900, Scottsdale, AZ 85251

 (Address
of Principal Executive Offices) (Zip Code)

 Registrant's
telephone number, including area code: (480) 389-3444

 Securities
registered pursuant to Section 12(b) of the Act:

 Title
 of each class

 Trading
 Symbol(s)

 Name
 of each exchange on which registered

 Common
 Stock, $0.00001 par value

 CISO

 The
 Nasdaq Stock Market LLC

 Securities
registered pursuant to Section 12(g) of the Act: Common Stock, par value $0.00001

by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes No

by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes No

by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days. Yes No

by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule
405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant
was required to submit such files). Yes No

by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting
company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer"
"smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

 Large
 accelerated filer

 Accelerated
 filer

 Non-accelerated
 filer

 Smaller
 reporting company

 Emerging
 growth company

 If
an emerging growth company, indicate by checkmark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

by check mark whether the Registrant has filed a report on and attestation to its management's assessment of the effectiveness
of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered
public accounting firm that prepared or issued its audit report.

 If
securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant
included in the filing reflect the correction of an error to previously issued financial statements.

by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation
received by any of the registrant's executive officers during the relevant recovery period pursuant to §240.10D-1(b).

by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes No

 The
aggregate market value of the common stock held by non-affiliates of the registrant as of the last business day of the registrant's
most recently completed second fiscal quarter (June 30, 2023) was $ 15,458,228.

 The
registrant had 12,232,379 shares of common stock outstanding as of April 5, 2024.

 CISO
GLOBAL, INC.

 2023
FORM 10-K ANNUAL REPORT

 TABLE
OF CONTENTS

 Page

 ITEM 1. BUSINESS

 ITEM 1A. RISK FACTORS

 ITEM 1B. UNRESOLVED STAFF COMMENTS

 ITEM 1C. CYBERSECURITY

 ITEM 2. PROPERTIES

 ITEM 3. LEGAL PROCEEDINGS

 ITEM 4. MINE SAFETY DISCLOSURES

 ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

 ITEM 6. [RESERVED]

 ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

 ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

 ITEM 9A. CONTROLS AND PROCEDURES

 ITEM 9B. OTHER INFORMATION

 ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

 ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

 ITEM 11. EXECUTIVE COMPENSATION

 ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

 ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

 ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

 ITEM
 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

 ITEM 16. FORM 10-K SUMMARY

 SIGNATURES

 - 2 -

 FORWARD-LOOKING
STATEMENTS

 The
information contained in this report should be read in conjunction with the financial statements and related notes contained elsewhere
in this Annual Report on Form 10-K. Certain statements made in this report are "forward-looking statements" within the meaning
of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"). These statements are based upon beliefs of, and information currently available
to, us as of the date hereof, as well as estimates and assumptions made by us. Readers are cautioned not to place undue reliance on these
forward-looking statements, which are only predictions and speak only as of the date hereof. When used herein, the words "anticipate,"
"believe," "estimate," "expect," "forecast," "future," "intend,"
"plan," "predict," "project," "target," "potential," "will,"
"would," "could," "should," "continue" or the negative of these terms and similar expressions
identify forward-looking statements. Such statements reflect our current view with respect to future events and are subject to risks,
uncertainties, assumptions, and other factors, including the risks relating to our business, industry, and our operations and results
of operations. Should one or more of these risks or uncertainties materialize, or should the underlying assumptions prove incorrect,
actual results may differ significantly from those anticipated, believed, estimated, expected, intended, or planned.

 Although
we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels
of activity, performance, or achievements. Except as required by applicable law, including the securities laws of the United States,
we do not intend to update any of the forward-looking statements to conform these statements to actual results.

 Forward-looking
statements made in this Annual Report on Form 10-K include statements about:

 our
 ability to achieve and sustain profitability of our existing lines of business and through our wholly owned subsidiaries;

 our
 ability to raise sufficient capital to continue to acquire cybersecurity companies;

 our
 ability to attract and retain qualified cybersecurity talent;

 our
 ability to identify potential acquisition targets within predetermined parameters;

 our
 ability to successfully execute acquisitions, integrate the acquired businesses, and create synergies as a global cybersecurity consolidator;

 our
 ability to attract and retain qualified key technology or management personnel and to expand our management team;

 the
 accuracy of estimates regarding expenses, future revenue, capital requirements, profitability, and needs for additional financing;

 our
 dependence on establishing and maintaining a strong brand;

 the
 occurrence of service interruptions and security or privacy breaches and related remediation efforts and fines;

 system
 failures or capacity constraints;

 our
 ability to efficiently acquire customers and maintain high client retention rates;

 the
 impact of fluctuations in foreign currency exchange rates on our business and our ability to effectively manage the exposure to such
 fluctuations;

 our
 ability to maintain our relationships with our partners;

 adverse
 consequences of our substantial level of indebtedness and our ability to repay our debt;

 our
 ability to maintain, protect and enhance our intellectual property;

 our
 ability to maintain or improve our market shares;

 business
 interruptions resulting from geo-political actions, including war, terrorism, and disease outbreaks (such as COVID-19, the war in
 Ukraine, tensions and conflict affecting the Middle East, and geopolitical tensions involving China);

 sufficiency
 of cash and cash equivalents to meet our needs for at least the next 12 months;

 our
 ability to grow internationally;

 beliefs
 and objectives for future operations;

 our
 ability to stay in compliance with laws and regulations currently applicable to, or which may become applicable to our business both
 in the United States and internationally;

 economic
 and industry trends or trend analysis;

 anticipated
 income tax rates, tax estimates and tax standards;

 expectations
 regarding the impact of inflation, action taken by central banks to counter inflation, rising interest rates, and changes in foreign
 exchange rates on our business and financial results;

 the
 future trading price of our common stock;

 our
 ability to maintain an effective system of internal controls and accurately report our financial results and remediate material weaknesses;

 our
 expectation regarding the outcome of any regulator investigation or litigation;

 the
 potential impact of shareholder activism on our business and operations;

 our
 ability to navigate through the increasingly complex cybersecurity regulatory environment; and any other statements regarding our
 future operations, financial condition, growth prospects and business strategies.

 These
statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks in the section
entitled "Risk Factors" set forth in this Annual Report on Form 10-K for the year ended December 31, 2023, any of which may
cause our or our industry's actual results, levels of activity, performance, or achievements to be materially different from any
future results, levels of activity, performance, or achievements expressed or implied by these forward-looking statements. These risks
may cause our or our industry's actual results, levels of activity, or performance to be materially different from any future results,
levels of activity, or performance expressed or implied by these forward-looking statements.

 Our
financial statements are prepared in accordance with accounting principles generally accepted in the United States. These accounting
principles require us to make certain estimates, judgments, and assumptions. We believe that the estimates, judgments, and assumptions
upon which we rely are reasonable based upon information available to us at the time that these estimates, judgments, and assumptions
are made. These estimates, judgments, and assumptions can affect the reported amounts of assets and liabilities as of the date of the
financial statements as well as the reported amounts of revenue and expenses during the periods presented. Our financial statements would
be affected to the extent there are material differences between these estimates and actual results. The following discussion should
be read in conjunction with our financial statements and notes thereto appearing elsewhere in this report.

 - 3 -

 PART
I

 ITEM
1. BUSINESS

 Unless
otherwise indicated or the context requires otherwise, the terms "we," "us," "our," and "our
company" refer to CISO Global, Inc., a Delaware corporation, and our wholly owned subsidiaries. Unless otherwise specified, all
dollar amounts are expressed in United States dollars.

 Our
Business

 General

 We
are a cybersecurity and compliance company comprised of highly trained and seasoned security professionals who work with clients to enhance
or create a better cyber posture in their organization. Cybersecurity, also known as computer security or information technology security,
is the protection of computer systems and networks from information disclosure, theft of or damage to their hardware, software, or electronic
data, as well as from the disruption or misdirection of the services they provide. The cybersecurity industry has a supply and demand
issue wherein there is more demand for cybersecurity services than there are expert and seasoned compliance and cybersecurity professionals
available in the market. We seek to identify, attract, and retain highly skilled cyber and compliance teams and bring them together to
provide holistic cyber services. We accomplish this through acquisitions, direct hiring, and incentivizing employees with stock options
to help retain them. On an ongoing basis, we seek to identify cyber talent that is culturally aligned and that offers operating leverage
through both existing customer revenue and relationships. We have invested in enterprise solutions and executive talent to integrate
our different organizations into an ecosystem that works together to provide complete and holistic cybersecurity through cross pollination
of solutions. The ecosystem is intended to provide additional revenue opportunities and drive overall recurring revenue.

 We
emphasize to clients the critical nature of having their work force create a continuously aware security culture. Once engaged, we strive
to become the trusted advisors for customers' cybersecurity and compliance needs by providing tailored security solutions based
upon their organizational needs. We do not focus on selling cybersecurity products; we are product-agnostic so that we can provide solutions
that fit the customer's security needs, financial realities, and future strategy. Our approach is to evaluate the client's
organization holistically, identify compliance requirements, and secure the infrastructure while helping to create a culture of security.

 We
provide a full range of cybersecurity consulting and related services, encompassing all three pillars of compliance, cybersecurity, and
culture. Our services include compliance services, secured managed services, security operations center ("SOC") services,
virtual Chief Information Security Officer ("vCISO") services, incident response, certified forensics, technical assessments,
and cybersecurity training. We believe that culture is the foundation of every successful cybersecurity and compliance program. To deliver
that outcome, we developed our unique offering of MCCP+ ("Managed Compliance & Cybersecurity Provider + Culture"), which
is the only holistic solution that provides all three of these pillars under one roof from a dedicated team of subject matter experts.
In contrast to the majority of cybersecurity firms that are focused on a specific technology or service, we seek to differentiate ourselves
by remaining technology agnostic, focusing on accumulating highly sought-after topic experts. We continually seek to identify and acquire
cybersecurity talent to expand our service scope and geographical coverage to provide the best possible service for our clients. We believe
that bringing together a world-class team of technological experts with multi-faceted expertise in the critical aspects of cybersecurity
is key to providing technology agnostic solutions to our clients in a business environment that has suffered from a chronic lack of highly
skilled professionals, thereby setting us apart from competitors and in-house security teams. Our goal is to create a culture of security
and to help quantify, define, and capture a return on investment from information technology and cybersecurity spending.

 Offering
this set of cybersecurity services allows us to capture more revenue with greater efficiency, facilitating greater profitability and
stronger customer retention. The benefit to our customers is that they receive an efficient engagement from a single provider that covers
a wide range of their needs. This means their challenges are addressed more thoroughly and problems are resolved more rapidly when compared
to working with multiple vendors. This leads to the best possible outcome, which enables our customers to commit to us for the long term.

 - 4 -

 We
believe that our business model is differentiated from other companies in the industry in that our employees are not consultants; they
are dedicated partners available on a recurring monthly contract. Due to the numerous challenges in hiring experienced cybersecurity
and compliance professionals, assimilating our team of industry and subject matter experts into our clients' teams is the ideal
solution.

 We
are technology agnostic. Whereas, most cybersecurity firms are locked into working with a single technology, we seek to differentiate
ourselves by remaining technology agnostic. This approach enables us to work with any business, no matter what systems or tools they
use. For our customers, the benefit is equally valuable as they are able to choose the best tools and technology for their business needs
without affecting their relationship with us.

 We
believe that building a world-class technology team with industry-specific and subject-matter expertise is the key to providing cutting-edge
solutions to our clients. We will continue to identify and acquire cybersecurity talent to expand our scope of services and geographical
footprint to fortify our capability to deliver excellence to our customers. Furthermore, our goal is to stay a step ahead of threat actors
and regulatory obligations to keep our customers safe and compliant.

 The
Cybersecurity Challenge

 As
the world has become increasingly connected through the Internet, cyberattacks have prevailed and evolved, in different forms,
causing uncontainable threats to the integrity and privacy of enterprise and personal data and resulted in significant economic
losses globally. A report published by Cybersecurity Ventures stated that damages from global cybercrime is predicted to hit $10.5
trillion annually by 2025. Cybersecurity Ventures estimated that consumers and organizations will fall victim to a ransomware attack
every two seconds at an approximate cost of $265 billion annually in 2031. This is up from $20 billion and every 11 seconds in 2021.
As a result, ransomware is one of the fastest growing types of cybercrime. Moreover, an Accenture survey reported that 68% of
business leaders feel their cybersecurity risks are increasing. Cybersecurity Ventures has also estimated that worldwide global
cybersecurity spending will exceed $1.75 trillion cumulatively from the fiscal years 2021 to 2025, with $459 billion expected to be spent on an annual basis in 2025. The New York Times reported that
in 2021 there would be 3.5 million unfilled job openings in the cybersecurity field. Three years later, despite widespread university
and government investments into education programs and recruitment efforts, the rates are roughly the same, based upon a report from Cybersecurity Ventures, and that disparity between
supply and demand will remain through at least 2025.

 In response to the increasing economic damage caused by heightened cybersecurity
risks, regulatory bodies have pushed the implementation of new cybersecurity legislations, and cyber insurance companies have increased
minimum cybersecurity underwriting requirements, as well as premium costs. We believe that we are well positioned in a fast-growing industry
to provide businesses with a wide scope of cybersecurity services and with significant opportunities for growth. We support clients from
17 historical acquisitions with expanded service offerings. With 1,100 clients, this represents a tremendous opportunity for cross-selling
and upselling. Additionally, we have built and continue to expand an extensive channel and partnership ecosystem, providing training,
support, and partner marketing content to establish reliable streams of new revenue with new clients. In addition, our strategy around
IP allows us to further penetrate our existing customers, new markets, and opens up additional partnership opportunities.

Service Offerings

 We offer a comprehensive range of cybersecurity services to protect our clients' digital assets and ensure compliance
with industry standards and regulations. Our services fall into two main categories: Security Managed Services and Professional Services.

 - 5 -

Managed Services

 Our Security Managed Services include the following offerings:

 Compliance
 Services: We help clients implement appropriate controls, prioritize risks, and ensure adherence to industry standards and regulations,
 such as Cybersecurity Maturity Model Certification ("CMMC"), Federal Risk and Authorization Management Program ("FedRAMP"),
 Federal Information Security Modernization Act ("FISMA"), Health
 Insurance Portability and Accountability Act of 1996 ("HIPAA"), Health Information Trust Alliance ("HITRUST"),
 Import Export Code ("IEC"), Internal Organization for Standardization ("ISO"), National Institute of Standards
 and Technology ("NIST"), and more. Our experienced experts possess relevant certifications and provide continuous monitoring
 and support.

 Cyber
 Defense Operations: Our U.S.-based SOC provides 24/7 threat monitoring, alerting, validation, and proactive threat hunting. We
 offer Managed Detection and Response ("MDR"), Extended Detection and Response ("XDR"), Security Information
 and Event Management ("SIEM"), and Patch and Vulnerability Management services, ensuring a unified solution for cyber
 resiliency.

 Secured
 Managed Services: We offer fully managed Security Managed Services ("SMS"), combining secure network architecture,
 our portfolio of internally developed cybersecurity software, SOC services, compliance support, remediation teams, and advanced
 firewall management. Our engineers and architects can manage secure cloud migrations, design new systems, and implement solutions to
 minimize security risks efficiently.

Professional Services

 Our Professional Services include the following offerings:

 Incident Response and
 Digital Forensics: Our experienced team specializes in identifying and
 remediating cyber attacks, using real-world hacking techniques to investigate the entire environment discreetly, assess the scope
 of the attack, and effectively remediate any damages or persistent threats.

 Security Testing and
 Training: We provide security testing services, including penetration
 testing (red team and purple team), attack simulation exercises, and training programs, including CMMC (Certified Cyber Profession
 ("CCP") and Cybersecurity Capability Assessment ("CCA")), Computing Technology Industry Association ("CompTIA"),
 International Information System Security Certification Consortium ("ISC 2 "), to increase clients' cybersecurity
 readiness and resiliency.

 - 6 -

 Growth
Strategy

 We
are following a phased growth strategy. In Phase I, we established a foundation of end-to-end cybersecurity experts through acquiring
niche companies with unparalleled expertise and talent. Today, our experts span the United States and Latin America and each have their
own special expertise, industry specific knowledge, familiarity with regulatory frameworks and focal areas that fall into four key pillars
of cybersecurity: risk and compliance, cyber defense operations, security testing and training, and secure IT and architecture. These
practice areas, led by a seasoned executive team of industry thought leaders, are enabling us to effectively tackle a rapidly expanding
market.

 In
Phase II of our growth strategy, we are supporting clients from 17 historical acquisitions with expanded service offerings. With only
a 9% penetration into 1,100 clients for multiple services consumed, this represents a tremendous opportunity for cross-selling and upselling.
Additionally, we have built and continue to expand an extensive channel and partnership ecosystem, providing training, support, and partner
marketing content to establish reliable streams of new revenue with new clients.

 Phase
II also includes the development and launch of key software-first intellectual property ("IP") technologies that can effectively address
many of the cybersecurity challenges facing enterprises today. Leveraging machine learning ("ML"), artificial intelligence ("AI"), deep learning,
and neural net technologies, as well as proprietary DarkNet threat intelligence, we are developing multi-layered cybersecurity
technologies to help drive the cyber effectiveness leading to resiliency.

 Equipped
with a comprehensive team, our focus in Phase III will be fueling organic growth with our intellectual property. With a complete
portfolio of scalable solutions that are underpinned by an end-to-end team of cybersecurity and compliance experts, we can expand
our technology offerings through product led growth strategies. Optimizing user experience and hands-free purchasing through digital
interfaces, the company can grow its clients without adding demand to its services team. Such scalability will serve to increase
revenue and margins concurrently.

 We
are focused on the development of our own Intellectual Property suite which incorporates AI, Neural Nets and the latest generation of
algorithms. Our portfolio includes the following software-first solutions:

 ARGO
 Security Management –
 A security management platform which is able to aggregate, then curate security
data in real time from a client's entire environment, including network asset information, currently deployed cyber tools, SOC,
vulnerability management, secure managed IT and penetration testing data.

 CISO
Edge Cloud Security Platform –
A cloud-first security solution designed to protect users from untrusted and malicious online threats. CISO Edge uses advanced
AI deep learning as well as artificial neural networks to provide advanced threat detection and monitoring.

 CHECKLIGHT
 Endpoint Security Monitoring
 – A powerful, proactive security monitoring software that detects potential threats to networks
and provides advance alerts so attacks can't take hold. Relying on the same cybersecurity software engine used by several federal
agencies, it identifies unauthorized processes associated with fraudulent phishing attacks, hacking, imposter scams, malware, ransomware,
and viruses.

 DISC
Next Gen VPN – A token exchange-protected remote access solution that replaces traditional VPN connections with enhanced
security and access verification.

 Skanda
Breach Assessment Tool – A next-generation,
analysis tool that applies AI-based automation and ML technologies, which looks beyond vulnerabilities identified by most other technology
to deliver continuous security assessments.

 Our
Corporate and Acquisition History

 We
were formed on March 5, 2019 as a Delaware corporation. Our principal offices are located at 6900 East Camelback Road, Suite 900, Scottsdale,
Arizona 85251.

 On
October 2, 2019, we filed a registration statement on Form 10-12G with the Securities and Exchange Commission ("SEC") to
effect registration of our common stock, par value $0.00001 per share, under the Exchange Act. The registration statement became effective
on December 1, 2019.

 On February 29, 2024, our
board of directors approved a 1-for-15 reverse stock split of our common stock. The record date for the reverse stock split was the
close of business on March 7, 2024, with share distribution occurring on March 8, 2024. As a result of the reverse stock split,
stockholders received one share of CISO Global, Inc. common stock, par value $0.00001, for each 15 shares they held as of the record
date. All share and per share amounts have been retroactively restated for the effects of this reverse stock split. Common stock
underlying our outstanding warrants, convertible notes, and options have also been adjusted, and the conversion and exercise prices
have also been adjusted.

 - 7 -

 We
have substantially expanded our business in recent years through a number of acquisitions. The following table sets forth certain information
regarding such acquisitions:

 Acquired
 Company, Location

 Type
 of Acquisition

 Date

 Services
 Provided by Acquired Company

 GenResults,
 LLC ("GenResults")

 Arizona (1)

 Stock

 April
 12, 2019

 services.

 VCAB
 Six Corporation ("VCAB")

 Texas

 April
 12, 2019

 N/A (2)

 TalaTek,
 LLC ("TalaTek")

 Virginia

 October
 1, 2019

 risk management services, including risk assessments, IT audits, cybersecurity services, and managed compliance services.

 Technologyville,
 Inc.

 Illinois

 Stock

 May
 25, 2020

 IT services.

 Clear
 Skies Security, LLC

 Georgia

 Stock

 August
 1, 2020

 assessment and penetration testing.

 Alpine
 Security, LLC

 Missouri

 16, 2020

 risk management services.

 Catapult
 Acquisition Corporation ("VelocIT")

 New
 Jersey

 August
 12, 2021

 risk management services.

 Atlantic
 Technology Systems, Inc., and

 Atlantic
 Technology Enterprises, Inc. (collectively, "Atlantic")

 New
 Jersey

 Stock

 October
 1, 2021

 risk management services.

 RED74
 LLC ("RED74")

 New
 Jersey

 November
 9, 2021

 risk management services.

 Ocean
 Point Equities, Inc. ("Arkavia")

 Santiago,
 Chile

 Stock

 1, 2021

 services.

 True
 Digital Security, Inc. ("True Digital")

 New
 York

 Florida

 Oklahoma

 Stock

 January
 19, 2022

 and compliance.

 Creatrix,
 Inc.

 Tennessee

 Maryland

 Stock

 June
 1, 2022

 Identity
 management, systems integration and software engineering, biometrics, vetting, credentialing, and case management.

 CyberViking,
 LLC

 Georgia

 Oregon

 Stock

 July
 1, 2022

 Application
 security services, incident response, threat hunting, and creation and management of security operation centers.

 Servicios
 Informaticos CUATROi, S.P.A.,

 Comercializadora
 CUATROi S.P.A.,

 CUATROi
 Peru, S.A.C., and

 CUATROi
 S.A.S.

 Santiago,
 Chile

 Bogota,
 Columbia, and Lima, Peru

 Stock

 August
 25, 2022

 services and cybersecurity.

 NLT
 Networks, S.P.A.,

 NLT
 Technologias, Limitada,

 NLT
 Servicios Profesionales, S.P.A., and

 White
 and Blue Solutions, LLC

 Providencia,
 Chile

 Florida

 Stock

 September
 1, 2022

 solutions and managed services.

 SB
 Cyber Technologies, LLC

 Virginia

 Stock

 July
 14, 2023

 services and compliance.

 (1)

 Prior
 to our acquisition of GenResults, GenResults was wholly owned by an entity affiliated with David G. Jemmett, our Chief Executive
 Officer and a director of our company. Due to the companies being under common control, we accounted for the acquisition as a reorganization.

 (2)

 At
 the time of the VCAB Merger, VCAB was subject to a bankruptcy proceeding and had minimal assets, no equity owners, and no liabilities,
 except for approximately 1,500 holders of Class 5 Allowed General Unsecured Claims and a holder of allowed administrative expenses
 (collectively the "Claim Holders"). Pursuant to the terms of the VCAB Merger, and in accordance with the bankruptcy plan,
 we issued an aggregate of 133,334 shares of our common stock (the "Plan Shares") to the Claim Holders as full settlement
 and satisfaction of their respective claims. As provided in the bankruptcy plan, the Plan Shares were issued pursuant to Section
 1145 of the United States Bankruptcy Code. We entered into the VCAB Merger to increase our stockholder base to, among other things,
 assist us in satisfying the listing standards of a national securities exchange.

 - 8 -

 Customers

 Our
recent acquisitions have resulted in expansion of our customer base and increased usage within existing customers. None of our customers
individually accounted for more than 10.0% of our consolidated revenue for the years ended December 31, 2023 and 2022, nor are we dependent
upon a few major customers.

 Competition

 The
cybersecurity market is highly fragmented. We primarily compete with established and emerging security product vendors. While the
market for traditional endpoint and IT operations solutions has historically been competitive, we believe as we look to enter into
adjacent markets and expand our total addressable market, we may face new competitors. We
believe we compete favorably with our competitors on the basis of these factors as a result of our intelligence and expertise from
the frontlines, as well as the features and performance of our solutions, the ease of integration of our solutions in diverse IT
environments, the breadth of our services, the integration of our SaaS solution offerings in our platform, the measurement and
reporting capabilities of our validation technologies, and the reputation of our consulting organization. However, many of our
competitors have substantially greater financial, technical and other resources, greater name recognition, larger sales and
marketing budgets, deeper customer relationships, broader distribution, and larger and more mature intellectual property
portfolios.

 We
face direct competition from all small-to-medium-sized cybersecurity service providers nationwide given the broad service scope we currently
provide. Many competitors provide cloud-based services, which means our competition is not restricted by regions. It is critical for
our executive management team to identify and attract strategic acquisition targets in order to strengthen our competitive advantage
as a cybersecurity consolidator, which we believe brings higher service quality, more diverse service scope, and broader geographical
coverage at a lower cost.

 Intellectual

 We believe that our intellectual property rights are valuable and important to our business. We rely on trademarks,
patents, copyrights, trade secrets, license agreements, intellectual property assignment agreements, confidentiality procedures, non-disclosure
agreements, and employee non-disclosure and invention assignment agreements to establish and protect our proprietary rights. Though we
rely in part upon these legal and contractual protections, we believe that factors such as the skills and ingenuity of our employees and
the functionality and frequent enhancements to our solutions are larger contributors to our success in the marketplace.

 We
continue to grow our portfolio of intellectual property rights in connection with our products, services, research and development,
and other activities to protect our proprietary technology relevant to our business. We intend to pursue
additional intellectual property protection to the extent we believe it would be beneficial and cost-effective.

 If we become more successful, we believe that competitors will be more likely to try to develop products that are
similar to ours and that may infringe our proprietary rights. It may also be more likely that competitors or other third parties will
claim that our products infringe their proprietary rights. In particular, large and established companies in the cybersecurity industry
have extensive patent portfolios and are regularly involved in both offensive and defensive litigation. From time-to-time, third parties,
including certain of these large companies and non-practicing entities, may assert patent, copyright, trademark, and other intellectual
property rights against us, our channel partners, our cloud platform providers, or our end-customers, whom our standard license and other
agreements obligate us to indemnify against such claims. Successful claims of infringement by a third party, if any, could prevent us
from distributing certain products or performing certain services, require us to expend time and money to develop non-infringing solutions,
or force us to pay substantial damages (including, in the United States, treble damages if we are found to have willfully infringed patents),
royalties or other fees. We cannot assure you that we do not currently infringe, or that we will not in the future infringe, upon any
third-party patents or other proprietary rights.

 - 9 -

 Government
Regulation

 We
are not aware of any specific regulations that govern cybersecurity firms or the areas in which we operate. While there are a few federal
cybersecurity regulations, they govern industries that we serve and exist to focus on specific industries.

 Three
of the main cybersecurity regulations are HIPAA, the 1999 Gramm-Leach-Bliley Act, and the 2002 Homeland Security Act, which included
the Federal Information Security Management Act ("FISMA"). The three regulations mandate that healthcare organizations, financial
institutions, and federal agencies, respectively, should protect their systems and information. FISMA, which applies to every government
agency, requires the development and implementation of mandatory policies, principles, standards, and guidelines on information security.
However, the regulations do not address numerous computer related industries, such as Internet Service Providers and software companies.
Furthermore, the regulations do not specify what cybersecurity measures must be implemented and require only a "reasonable"
level of security.

 In
addition, the National Cybersecurity Division is another regulatory body that is a division of the Office of Cybersecurity & Communications
within the U.S. Department of Homeland Security's Cybersecurity and Infrastructure Security Agency.

 Human
Capital Management

 We
believe that our future success will depend, in part, on our continued ability to attract, hire, and retain qualified personnel. In particular,
we depend on the skills, experience, and performance of our senior management and engineering and technical personnel. We compete for
qualified personnel with other cyber security companies and industry experts.

 We
provide competitive compensation and benefits programs to help meet the needs of our employees. In addition to salaries, these programs
(which vary by country/region and employment classification) include incentive compensation plan, pension, healthcare and insurance benefits,
paid time off, family leave, and on-site services, among others. We also use targeted equity-based grants with vesting conditions to
facilitate retention of personnel, particularly for our key employees.

 The
success of our business is fundamentally connected to the well-being of our people. Accordingly, we are committed to the health and safety
of our employees. In response to the COVID-19 pandemic, we implemented significant changes that we determined were in the best interest
of our employees, as well as the communities in which we operate, and which comply with government regulations. This includes having
employees work from home, while implementing additional safety measures for employees continuing critical on-site work.

 Environmental,
Social, and Governance Efforts

 Environmental
Commitment

 We
are committed to protecting the environment and attempt to mitigate any negative impact of our operations. We monitor resource use, improve
efficiency, and at the same time reduce our emissions and waste.

 Social
Responsibility

 We
are a trusted cybersecurity expert providing safe, efficient, and sustainable services to our existing and new communities. Our success
is the direct result of the dedication and strength of our team and promotes equity, diversity, integrity, inclusion, reliability and
accountability. We believe that a combination of diverse team members and an inclusive culture contributes to our success. Each member
is a valued part of our team bringing a diverse perspective to help grow business and achieve our goals. Our tradition of serving employees,
customers, and investors is at the core of our culture. For third-party vendor selection and oversight, we have standard operating procedures
that apply to employees and subcontractors who, on our behalf, oversee and conduct technical protocols.

 - 10 -

 Employees

 As
of December 31, 2023, we had 402 employees, of which 397 were full-time. In addition, we utilize independent contractors for
projects of short duration or where specialized knowledge or experience is needed for a complex project. We are not dependent on any
independent contractor, and we believe adequate replacements would be available in the event any such independent contractor becomes
unavailable to us. We believe our relations with our employees is good.

 Available
Information

 Our
Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, our proxy and information statements and all
amendments to those reports will be available free of charge through our website at www.ciso.inc as soon as practicable after such material
is electronically filed with, or furnished to, the SEC. Except as otherwise stated in these documents, the information contained on our
website or available by hyperlink from our website is not incorporated by reference into this report or any other documents we file,
with or furnish to, the SEC.

 Implications
of Being an Emerging Growth Company

 We
qualify as an "emerging growth company" as the term is used in The Jumpstart Our Business Startups Act of 2012 (the "JOBS
Act"), and therefore, we may take advantage of certain exemptions from various public company reporting requirements, including:

 a
 requirement to only have two years of audited financial statements and only two years of related selected financial data and management's
 discussion and analysis;

 exemption
 from the auditor attestation requirement on the effectiveness of our internal controls over financial reporting;

 reduced
 disclosure obligations regarding executive compensation; and

 exemptions
 from the requirements of holding a nonbinding advisory stockholder vote on executive compensation and any golden parachute payments.

 We
may take advantage of these provisions for up to five years or such earlier time that we are no longer an emerging growth company. We
would cease to be an emerging growth company if we have more than $1.07 billion in annual revenue, issue more than $1.0 billion of non-convertible
debt over a three-year period, or become a large accelerated filer. So long as we remain an emerging growth company, we may choose to
take advantage of some, but not all, of the available benefits of the JOBS Act. We have taken advantage of some of the reduced reporting
requirements in our filings. Accordingly, the information contained herein may be different than the information you receive from other
public companies in which you hold stock. In addition, the JOBS Act provides that an emerging growth company can delay adopting new or
revised accounting standards until such time as those standards apply to private companies. We have elected to avail ourselves of this
exemption from new or revised accounting standards and, therefore, we will not be subject to the same new or revised accounting standards
as other public companies that are not emerging growth companies.

 ITEM
1A. RISK FACTORS

 An
investment in our common stock involves a number of very significant risks. Readers of this Annual Report on Form 10-K should carefully
consider the following risks and uncertainties in addition to other information in this Annual Report on Form 10-K in evaluating our
company and its business before purchasing shares of our common stock. Our business, operating results and financial condition could
be seriously harmed due to any of the following risks. An investor in our common stock could lose all or part of their investment due
to any, or a combination of these risks.

 Risk
Factor Summary

 Risks
Related to Our Business and Industry

 We
 will need to raise capital in order to realize our business plan and growth strategy, the failure of which could adversely impact
 our operations.

 - 11 -

 We
 incurred significant operating losses during the years ended December 31, 2023 and December 31, 2022, and we have limited cash flow.
 Unless we increase revenue and cash flow or raise additional capital, we may be unable to take advantage of any acquisition opportunities
 that arise or expand our business, all of which could adversely impact us.

 We
 will need to grow the size and capabilities of our organization, and we may experience difficulties in managing this growth.

 We
 depend on key personnel who would be difficult to replace, and our business plans will likely be harmed if we lose their services
 or cannot hire additional qualified personnel.

 We
 operate in an industry that is experiencing a shortage of qualified compliance and cybersecurity professionals. If we are unable
 to recruit and retain key management and technical and sales personnel, our business would be negatively affected.

 We
 depend on independent contractors to provide certain services for which we do not have the expertise internally. Any compromise in
 the service quality may delay our business processes and cause economic loss.

 We
 have recently acquired multiple businesses. Our growth strategy is driven by successful acquisitions and integration of additional
 businesses that provide comparable or complementary services. Our ability to grow is limited if we fail to identify and consummate
 acquisitions.

 We
 intend to grow our client base significantly through acquisitions of other service providers. If we fail to retain existing clients
 and attract new clients through acquisitions, we may never achieve profitability.

 Our
 business strategy may impose limitations in our ability to accurately forecast future revenue and operating results.

 Our
 future results may be affected by various legal and regulatory proceedings and legal compliance risks, including those involving
 intellectual property, governmental regulations, the U.S. Foreign Corrupt Practices Act, and other anti-bribery, anti-corruption,
 or other matters.

 We
 are subject to risks from operating internationally.

 Our
 operations in certain emerging markets expose us to political, economic and regulatory risks.

 Adverse
 economic conditions in the United States and international economies may adversely impact our business operating units.

 Breaches
 of network or information technology security could have an adverse effect on our business.

 If
 we fail to meet our service level obligations under our service level agreements, we may be subject to certain penalties and could
 lose clients.

 The
 nature of our business involves significant risks and uncertainties that may not be covered by insurance or indemnification.

 We
 indemnify our officers and directors against liability to us and our security holders, and such indemnification could increase our
 operating costs.

 Our
 industry is highly competitive, and there is no assurance that we will compete successfully.

 Our
 success depends on our ability to protect our intellectual property and our proprietary technologies.

 Increasingly
 complex cybersecurity regulations and standards may have significant impact on our business, and it may require us to substantially
 invest in our development capabilities to meet compliance requirements and may negatively impact our ability to offer certain services
 and remain profitable.

 We
 may become subject to disputes, including litigation, that could negatively impact our business, profitability, and financial condition.

 If
 we incur additional debt, we will be subject to restrictive covenants and debt service obligations that could negatively impact our
 operations.

 The
 requirements of being a public company, including compliance with the reporting requirements of the Exchange Act and the requirements
 of the Sarbanes-Oxley Act and Nasdaq, may strain our resources, increase our costs and divert management's attention, and we
 may be unable to comply with these requirements in a timely or cost-effective manner.

 The
 preparation of our financial statements involves use of estimates, judgments, and assumptions, and our financial statements may be
 materially affected if our estimates prove to be inaccurate.

 The
 auditor's opinion on our audited consolidated financial statements for the year ended December 31, 2023, included in this
 annual report on Form 10-K, contain an explanatory paragraph relating to our ability to continue as a going concern.

 Risks
Related to Our Common Stock

 The
 market price of our common stock is volatile and may fluctuate in a way that is disproportionate to our operating performance.

 Future
 sales of shares of our common stock by existing stockholders could depress the market price of our common stock.

 - 12 -

 Provisions
 in our certificate of incorporation, our by-laws and Delaware law might discourage, delay, or prevent a change in control of our
 company or changes in our management and, therefore, depress the trading price of our common stock.

 FINRA
 sales practice requirements may limit a stockholder's ability to buy and sell our stock.

 If
 we issue additional shares in the future, it will result in the dilution of our existing stockholders.

 We
 are eligible to be treated as an "emerging growth company," as defined in the JOBS Act, and we cannot be certain if the
 reduced disclosure requirements applicable to emerging growth companies will make our common stock less attractive to investors.

 Our directors, a former director and executive officers beneficially own
a substantial majority of our outstanding capital stock and will have the ability to control our affairs.

 Our
 failure to meet the continued listing requirements of Nasdaq could result in a delisting of our common stock.

 Following a reverse
 stock split, the resulting market price of our common stock may not attract new investors, including institutional investors, and
 may not satisfy the investing requirements of those investors. Consequently, the trading liquidity of our common stock may not improve.

 We
 do not intend to pay dividends on our common stock.

 Our
 business could be negatively impacted by shareholder activism.

 Our
 share price may be volatile, and you may be unable to sell your shares.

 Risks
Related to Our Business and Industry

 We
will need to raise capital in order to realize our business plan and growth strategy, the failure of which could adversely impact our
operations.

 Our
growth strategy is based upon increasing the number of our clients and our consolidated revenue by making successful acquisitions and
integrating businesses that provide comparable or complementary cyber security services. As of December 31, 2023, our business was not
profitable. Without adequate funding, a significant increase in revenue, and continued successful integration of our acquired targets,
we may not be able to achieve profitability in the existing lines of business and attract further capital. As of March 31, 2024, we had
available cash resources of approximately $1,575,856.

 We
expect to continue to finance our operations with available net operating cash flows and will need to raise additional capital in the
future by issuing equity or other forms of securities, which could have significant dilutive impact on the ownership interest of existing
stockholders. Furthermore, any newly issued securities could have rights, preferences, and privileges senior to those of our existing
common stock.

 We
may have difficulty obtaining additional funds as and when needed, and we may have to accept terms that would adversely affect our stockholders.
In addition, any adverse conditions in the credit and equity markets may adversely affect our ability to raise funds when needed. Any
failure to achieve adequate funding will delay our acquisition efforts and could lead to abandonment of one or more of our acquisition
initiatives, as well as prevent us from responding to competitive pressures or take advantage of unanticipated acquisition opportunities.
Any additional equity financing will likely be dilutive to stockholders, and certain types of equity financing, if available, may involve
restrictive covenants or other provisions that would limit how we conduct our business or finance our operations.

 We
incurred significant operating losses during the years ended December 31, 2023 and December 31, 2022, and we have limited cash flow.
Unless we increase revenue and cash flow or raise additional capital, we may be unable to take advantage of any acquisition opportunities
that arise or expand our business, all of which could adversely impact us.

 We
are unable to predict if and when we will be able to generate significant positive cash flow or achieve profitability. Our plan regarding
these matters is to strengthen our revenue and continue improving operational efficiencies across the business. There can be no assurances
that we will be successful in increasing revenue, improving operational efficiencies or that financing will be available or, if available,
that such financing will be available under favorable terms. In the event that we are unable to generate adequate revenue to cover expenses
and cannot obtain additional financing, we may need to cut back or curtail our expansion plans.

 - 13 -

 We
will need to grow the size and capabilities of our organization, and we may experience difficulties in managing this growth.

 As
our acquisition strategies develop, we must carefully integrate managerial, operational, sales, marketing, financial, and other personnel
in the expanded organization and manage costs. Future growth will impose significant added responsibilities on members of management,
including the following:

 identifying,
 integrating, managing, and motivating qualified employees, particularly strong sales force and cybersecurity talent;

 executing
 post-acquisition integration effectively, and managing integration costs; and

 improving
 our operational, financial, and management controls, reporting systems, and procedures.

 Our
future financial performance and our ability to commercialize our strategic acquisitions will depend, in part, on our ability to effectively
manage any future growth. Our management may also have to divert a disproportionate amount of its attention away from day-to-day activities
in order to devote a substantial amount of time to managing these growth activities. This lack of long-term experience working together
may adversely impact our senior management team's ability to effectively manage our business and growth.

 We
depend on key personnel who would be difficult to replace, and our business plans will likely be harmed if we lose their services or
cannot hire additional qualified personnel.

 Our
success depends substantially on the efforts and abilities of our senior management and executive officers. We currently do not maintain
key man insurance for any of our senior management or key personnel. The competition for qualified management and key personnel
is intense. The loss of services of one or more of our key employees, or the inability to hire, train, and retain key personnel, especially
executive managers with cybersecurity industry knowledge, could delay the execution of new acquisitions and launch of new service programs,
disrupt our business, and interfere with our ability to execute our business plan.

 We
operate in an industry that is experiencing a shortage of qualified compliance and cybersecurity professionals. If we are unable to recruit
and retain key management and technical and sales personnel, our business would be negatively affected.

 To
execute our growth strategy, we must continue to attract and retain highly skilled compliance and cybersecurity experts. Competition
for these employees is intense, especially for compliance experts and cybersecurity professionals, as there is a global shortage of these
professionals who can provide the technical and strategic skills required for us to deliver high levels of services to our clients and
potential clients. We may not be successful in attracting and retaining qualified employees. We have from time-to-time experienced, and
we expect to continue to experience, difficulty in hiring and retaining highly skilled employees with appropriate qualifications. Many
of the companies with which we compete for these highly skilled employees have greater resources than we have. In addition, in making
employment decisions, particularly in the high-technology industry, job candidates often consider the value of the stock options, restricted
stock grants, or other stock-based compensation they are to receive in connection with their employment. Declines in the value of our
stock could adversely affect our ability to attract or retain key employees and result in increased employee compensation expenses. If
we fail to attract new personnel or fail to retain and motivate our current personnel, our business and future growth prospects could
be severely harmed.

 We
depend on independent contractors to provide certain services for which we do not have the expertise internally. Any compromise in the
service quality may delay our business processes and cause economic loss.

 We
currently rely, and for the foreseeable future will continue to rely, in substantial part on certain independent organizations, advisors,
and consultants to provide certain services. There can be no assurance that the services of these independent organizations, advisors,
and consultants will continue to be available to us on a timely basis when needed, or that we can find qualified replacements. In addition,
if we are unable to effectively manage our outsourced activities or if the quality or accuracy of the services provided by consultants
is compromised for any reason, some of our business activities may be delayed or terminated, and we may not be able to mitigate negative
impacts or otherwise advance our business. There can be no assurance that we will be able to manage our existing consultants or find
other competent outside contractors and consultants on economically reasonable terms, if at all. If we are not able to effectively expand
our organization by hiring new employees and expanding our groups of consultants and contractors, we may not be able to successfully
implement the tasks necessary to further expand and, accordingly, may not achieve our business goals.

 - 14 -

 We
have recently acquired multiple businesses. Our growth strategy is driven by successful acquisitions and integration of additional businesses
that provide comparable or complementary services. Our ability to grow is limited if we fail to identify and consummate acquisitions.

 We
have completed the acquisition of certain complementary businesses, and we intend to consider additional potential strategic transactions,
which could involve acquisitions of businesses or assets, joint ventures, or investments in businesses or technologies that expand, complement,
or otherwise relate to our business. We may also consider, from time to time, opportunities to engage in joint ventures or other business
collaborations with third parties. Should our relationships fail to materialize into significant agreements, or should we fail to work
efficiently with these companies, we may lose sales and marketing opportunities and our business, results of operations, and financial
condition could be adversely affected.

 Any
business acquisition creates risks such as, among others: (i) the need to integrate and manage the businesses acquired with our own business;
(ii) additional demands on our resources, systems, procedures, and controls; (iii) disruption of our ongoing business; and (iv) diversion
of management's attention from other business concerns. Moreover, these transactions could involve: (a) substantial investment
of funds or financings by issuance of debt or equity securities; (b) substantial investment with respect to technology transfers and
operational integration; and (c) the acquisition or disposition of lines of businesses. Also, such activities could result in one-time
charges and expenses and have the potential to either dilute the interests of our existing stockholders or result in the issuance of,
or assumption of debt. Such acquisitions, investments, joint ventures, or other business collaborations may involve significant commitments
of financial and other resources. Any such activities may not be successful in generating revenue, income, or other returns, and any
resources we committed to such activities will not be available to us for other purposes. Moreover, if we are unable to access the capital
markets on acceptable terms or at all, we may not be able to consummate acquisitions, or may have to do so on the basis of a less than
optimal capital structure. Our inability to take advantage of growth opportunities or address risks associated with acquisitions or investments
in businesses may negatively affect our operating results.

 Additionally,
any impairment of goodwill or other intangible assets acquired in an acquisition or in an investment, or charges to earnings associated
with any acquisition or investment activity, may materially reduce our earnings. Future acquisitions or joint ventures may not result
in their anticipated benefits and we may not be able to properly integrate acquired technologies or businesses with our existing operations
or successfully combine personnel and cultures. Failure to do so could deprive us of the intended benefits of those acquisitions.

 We
intend to grow our client base significantly through acquisitions of other service providers. If we fail to retain existing clients and
attract new clients through acquisitions, we may never achieve profitability.

 Through
acquisition of other service providers, we will inherit an increasingly larger client base, which creates cross-selling and up-selling
opportunities. We need high-quality service and exemplary client management to retain and grow our client base. We also plan to launch
sales and marketing efforts, including trade show appearances, sales demos, and advertising campaigns in various forms to promote our
brand name. If our marketing efforts do not materialize, we may lose existing clients or fail to obtain new clients. Our inability to
grow sales as we expand in operations may result in continuing losses, and we may not be profitable for an extended period of time. In
addition, even if we are able to make future acquisitions, we will incur additional costs to consummate them, which may result in a shortage
in our capital resources. We may also incur difficulties in integrating new businesses with our current operations.

 Our
business strategy may impose limitations in our ability to accurately forecast future revenue and operating results.

 Our
operating results are dependent on a variety of factors, including purchasing patterns of our clients, competitive pricing, debt servicing,
and general economic trends. Our revenue and operating results may fluctuate if our sales targets are not met, new service offerings
receive poor client response, or client acquisition costs increase due to competition. In addition to these factors, our acquisition
strategy may impose additional risks to the predictability of our operating results. Revenue streams may be volatile due to the uncertainty
in identifying attractive acquisition candidates and our ability to consummate new acquisitions. Unexpected expenses may be incurred
during due diligence and post-acquisition. Management intends to manage risk carefully with the acquisitions; however, there can be no
assurance that we will be able to identity and consummate acquisitions that improve our results of operations.

 - 15 -

 Our
sales cycles can be long and unpredictable, and our sales efforts require considerable time and expense.

 Our
revenue recognition is difficult to predict because of the length and unpredictability of the sales cycle for our solutions, particularly
with respect to large organizations and government entities. For example, in light of current macroeconomic conditions, we have observed
a lengthening of the sales cycle for some prospective customers that we attribute to higher cost-consciousness around IT budgets. Customers
often view the subscription to our solutions as a significant strategic decision and, as a result, frequently require considerable time
to evaluate, test and qualify our solutions prior to entering into or expanding a relationship with us. Large enterprises and government
entities in particular, often undertake a significant evaluation process that further lengthens our sales cycle. Our direct sales team
develops relationships with our customers, and works with our channel partners on account penetration, account coordination, sales and
overall market development. We spend substantial time and resources on our sales efforts without any assurance that our efforts will
produce a sale. Security solution purchases are frequently subject to budget constraints, multiple approvals and unanticipated administrative,
processing and other delays. As a result, it is difficult to predict whether and when a sale will be completed. The failure of our efforts
to secure sales after investing resources in a lengthy sales process would adversely affect our business, operating results and financial
condition.

 Because
we recognize revenue from subscriptions to our solutions over the term of the subscription, downturns or upturns in new business will
not be immediately reflected in our operating results.

 We
generally recognize revenue from customers ratably over the term of their subscription, which is generally one to three years. As a result,
a substantial portion of the revenue we report in each period is attributable to the recognition of deferred revenue relating to agreements
that we entered into during previous periods. Consequently, any increase or decrease in new sales or renewals in any one period will
not be immediately reflected in our revenue for that period. Any such change, however, would affect our revenue in future periods. Accordingly,
the effect of downturns or upturns in new sales and potential changes in our rate of renewals will not be fully reflected in our operating
results until future periods. We may also be unable to timely reduce our cost structure in line with a significant deterioration in sales
or renewals that would adversely affect our business, operating results, and financial condition.

 We
provide service level commitments under some of our customer contracts. If we fail to meet these contractual commitments, we could be
obligated to provide partial refunds or our customers could be entitled to terminate their contracts and our business would suffer.

 Certain
of our customer agreements contain service level commitments, which contain specifications regarding the availability of our solutions
and our support services. Failure of or disruption to our infrastructure or third-party hosting service providers could impact the performance
of our solutions and the availability of services to customers. If we are unable to meet our stated service level commitments or if we
suffer extended periods of poor performance or unavailability of our solutions, we may be contractually obligated to provide affected
customers with credit, partial refunds or termination rights. To date, there has not been a material failure to meet our service level
commitments, and we do not currently have any material liabilities accrued on our consolidated balance sheets for such commitments. Our
business, operating results, and financial condition would be adversely affected if we suffer performance issues or downtime that exceeds
the service level commitments under our agreements with our customers.

 - 16 -

 Our
business is subject to the risks of warranty claims from real or perceived defects in our solutions or their misused by our customers
or third parties and provisions in certain agreements potentially expose us to substantial liability and other losses.

 We
may be subject to liability claims for damages related to errors or defects in our solutions. A material liability claim or other occurrence
that harms our reputation or decreases market acceptance of our solutions will harm our business and operating results. Although we generally
have limitation of liability provisions in our terms and conditions of sale, they may not fully or effectively protect us from claims
as a result of federal, state or local laws or ordinances, or unfavorable judicial decisions in the United States or other countries.
The sale and support of our solutions also entails the risk of product liability claims. We employ measures in the form of policy and
technical controls to limit unauthorized access to our solutions by our employees, customers and third-parties, however, these measures
may not fully or effectively protect our solutions from unauthorized access. Additionally, we typically provide indemnification to customers,
partners or other third parties we do business with for certain losses suffered or expenses incurred as a result of third-party claims
arising from our infringement of a third party's intellectual property. We also provide unlimited liability for certain breaches
of confidentiality, as defined in our master subscription agreement. We also provide limited liability in the event of certain breaches
of our master subscription agreement. Certain of these contractual provisions survive termination or expiration of the applicable agreement.
To date, we have not incurred any material costs because of such obligations. However, as we continue to grow, indemnification claims
against us for the obligations listed will increase. When our customers or other third parties we do business with make intellectual
property rights or other indemnification claims against us, we will incur significant legal expenses and may have to pay damages, license
fees and/or stop using technology found to be in violation of the third party's rights. We may also have to seek a license for
the technology. Such licenses may not be available on reasonable terms, if at all, and may significantly increase our operating expenses
or may require us to restrict our business activities and limit our ability to deliver certain solutions or features. We may also be
required to develop alternative non-infringing technology, which could require significant effort and expense and/or cause us to alter
our solutions, which could harm our business. Large indemnity obligations, whether for intellectual property or in certain limited circumstances,
other claims, would harm our business, operating results and financial condition.

 Additionally,
our solutions may be used by our customers and other third parties who obtain access to our solutions for purposes other than for which
our solutions was intended. We maintain insurance to protect against certain claims associated with the use of our solutions, but our
insurance coverage may not adequately cover the claims asserted against us. In addition, even claims that ultimately are unsuccessful
could result in our expenditure of funds in litigation, divert management's time and other resources, and harm our business and
reputation. We have offered some of our customers a limited warranty, subject to certain conditions. Any failure or refusal of our insurance
providers to provide the expected insurance benefits to us after we have remediated warranty claims would cause us to incur significant
expense or cause us to cease offering warranties which could damage our reputation, cause us to lose customers, expose us to liability
claims by our customers, negatively impact our sales and marketing efforts, and have an adverse effect on our business, operating results,
and financial condition. Further, although the terms of the warranty do not allow those customers to use warranty claim payments to fund
payments to persons on the U.S. Treasury Department's Office of Foreign Assets Control (OFAC), list of Specially Designated Nationals
and Blocked Persons or who are otherwise subject to U.S. sanctions, we cannot assure you that all of our customers will comply with our
warranty terms or refrain from taking actions, in violation of our warranty and applicable law.

 Our
future results may be affected by various legal and regulatory proceedings and legal compliance risks, including those involving intellectual
property, governmental regulations, the U.S. Foreign Corrupt Practices Act, and other anti-bribery, anti-corruption, or other matters.

 We
may be subject to various legal and regulatory proceedings, and are subject to certain legal compliance risks in the areas of intellectual
property, governmental regulation, U.S. Foreign Corrupt Practices Act, and related anti-bribery and anti-corruption regulations. The
outcome of any such legal proceedings may differ from our expectations because the outcomes of litigation, including regulatory matters,
are often difficult to reliably predict. Various factors or developments can lead us to change current estimates of liabilities and related
insurance requirements where applicable, or make such estimates for matters previously not susceptible of reasonable estimates, such
as a significant judicial ruling or judgment, a significant settlement, significant regulatory developments, or changes in applicable
law. A future adverse ruling, settlement, or unfavorable development could result in future charges that could have a material adverse
effect on our results of operations or cash flows in any particular period.

 We
are subject to risks from operating internationally.

 We
operate internationally, and our growth strategy depends in part on our ability to expand our operations in foreign markets, including
by way of acquisitions. International operations and business expansion plans are subject to numerous risks, including the following:

 the
 burden of complying with complex and changing foreign regulatory, tax, accounting and legal requirements;

 Political,
 social, or economical unrest, terrorism, hostilities or war, including the current military conflict between Russia and the Ukraine
 and in the Middle East;

 changes
 in U.S. and other national government trade policies affecting the markets for our services;

 changes
 in regulatory practices, tariffs and taxes;

 - 17 -

 the
 need to develop superior products or services, thereby gaining greater market acceptance and expanding their product and service
 offerings more efficiently or rapidly;

 potential
 non-compliance with a wide variety of laws and regulations, including anti-corruption, export control and anti-boycott laws and similar
 non-U.S. laws and regulations

 increased
 sovereign risk, such as defaults by or deterioration in the economies and credit ratings of governments, particularly in emerging
 markets;

 logistical
 and communication challenges;

 the
 interpretation of contractual provisions governed by foreign laws in the event of a contract dispute; and

 currency
 exchange rate fluctuations, devaluations and other conversion restrictions.

 Any
of these factors could have a material adverse effect on our reputation, financial condition, results of operations and stock price.

 Our
operations in certain emerging markets expose us to political, economic and regulatory risks.

 Our
growth strategy depends in part on our ability to expand our operations in emerging markets, including, among others, countries in South
America, and Europe. However, some emerging markets have greater political, economic and currency volatility and greater vulnerability
to infrastructure and labor disruptions than more established markets. In many countries, particularly those with emerging economies,
engaging in business practices prohibited by laws and regulations with extraterritorial reach, such as the Foreign Corrupt Practices
Act of 1977 and the U.K. Bribery Act, or local anti-bribery laws may be more common. These laws generally prohibit companies and their
employees, contractors or agents from making improper payments to government officials, including in connection with obtaining permits
or engaging in other actions necessary to do business. Failure to comply with these laws could subject us to civil and criminal penalties
that could materially and adversely affect our reputation, financial condition, results of operations and stock price. Failure to manage
political, economic and regulatory risks in emerging markets could adversely affect our sales, financial condition, results of operations,
cash flows and stock price.

 Adverse
economic conditions in the United States and international economies may adversely impact our business operating units.

 General
macro-economic conditions, such as a rise in interest rates, inflation in the cost of goods and services including labor, a recession
or an economic slowdown in the United States or internationally, could adversely affect demand for our services and make it difficult
to accurately forecast and plan our future business activities. For example, U.S. and global markets have been experiencing volatility
and disruption due to interest rate and inflation increases, such as higher inflation rates in the U.S., which rose in the second half
of 2021 and have remained above the Federal Reserve's inflation target, as well as the continued escalation of geopolitical tensions,
including those as a result of the conflicts between Russia and Ukraine and in the Middle East. We have experienced and continue to experience
inflationary pressures in certain areas of our business. Although our business has not yet been materially negatively impacted by such
inflationary pressures, we cannot be certain that neither we nor our customers will be materially impacted by continued pressures. To
the extent conditions in the domestic and global economy change, our business could be harmed as current and potential customers may
reduce or postpone spending or choose not to purchase our services or products, which they may consider discretionary. If our customers
face decreased consumer demand, increased regulatory burdens or more limited access to international markets, we may face a decline in
demand for our products and services, and our operating results could be adversely impacted.

 To
the extent conditions in the domestic and global economy change, our business could be harmed as current and potential customers may
reduce or postpone spending or choose not to purchase or renew our services, which they may consider discretionary. If our customers
face decreased consumer demand, increased regulatory burdens, or more limited access to international markets, we may face a decline
in the demand for our services and our operating results could be adversely impacted.

 Uncertain
and adverse economic conditions may also lead to a decline in the ability of our customers to use or access credit, which could adversely
affect our business. In addition, changing economic conditions may also adversely affect third parties with which we have entered into
relationships and upon which we depend in order to grow our business. As a result, we may be unable to continue to grow in the event
of future economic slowdowns.

 - 18 -

 Breaches
of network or information technology security could have an adverse effect on our business.

 Cyber-attacks
or other breaches of network or IT security may cause equipment failures or disrupt the systems and operations of us and our clients.
The potential liabilities associated with these events could exceed the insurance coverage we or our clients maintain, if any. An inability
to operate as a result of such events, even for a limited period of time, may result in significant expenses or loss of market share
to other competitors in the market we serve. In addition, a failure to protect our, or our client's, enterprises, networks, privacy
of customer, and employee confidential data against breaches of network or IT security could result in damage to our reputation. To date,
we have not been subject to cyber-attacks or other cyber incidents which, individually or in the aggregate, resulted in a material adverse
effect on our business, operating results, or financial condition.

threats to our own IT infrastructure may affect our clients indirectly. A party who is able to compromise the security measures on our
networks or the security of our infrastructure could misappropriate our proprietary information or the personal information of our clients,
cause interruptions or malfunctions in our operations or our clients' operations, or damage our computers or systems and those
of our clients. As security is a primary competitive factor in our industry, such a compromise could be particularly harmful to our brand
and reputation. We may be required to expend significant resources to protect against such threats or to alleviate problems caused by
breaches in security. As techniques used to breach security change frequently, and are generally not recognized until launched against
a target, we may not be able to implement security measures in a timely manner or, if and when implemented, we may not be able to determine
the extent to which these measures could be circumvented. If we are unable to protect sensitive information, our clients or governmental
authorities could question the adequacy of our threat mitigation and detection processes and procedures. Any breaches that may occur
could expose us to increased risk of lawsuits, regulatory penalties, loss of existing or potential customers, harm to our reputation,
and increases in our security costs, which may not be fully insured or indemnified by other means. Additionally, breaches of our, or
our clients', systems could similarly result in a loss of confidence in our services or damage to our brand and reputation. Occurrence
of any of these events could have a material adverse effect on our business, financial condition, operating results, or prospects.

 Because
our services are aimed at protecting clients from, and limiting the impact of, critical business interruptions and losses related to
cyber-attacks, if our client's experience losses related to cyber-attacks that result in lost profits or other indirect or consequential
damages to our clients, our clients may expose us to lawsuits. Our service agreements with our clients typically contain provisions limiting
our liability. However, we cannot provide assurances that a court would enforce any contractual limitations on our liability. The outcome
of any such lawsuit would depend on the specific facts of the case and any legal and policy considerations that we may not be able to
mitigate. In such cases, we could be liable for substantial damage awards that may exceed our liability insurance coverage by unknown
but significant amounts, which could materially impair our financial condition.

 If
we fail to meet our service level obligations under our service level agreements, we may be subject to certain penalties and could lose
clients.

 We
have service level agreements with many of our managed services clients under which we guarantee specified levels of service availability.
These arrangements require us to estimate the level of service we will provide. If we fail to meet our service level obligations under
these agreements, we may be subject to penalties, which could result in higher than expected costs, and we may lose clients, which could
lead to decreased revenue and decreased gross and operating margins. If we fail to meet our service level obligations under these agreements,
our reputation may suffer as a result.

 The
nature of our business involves significant risks and uncertainties that may not be covered by insurance or indemnification.

 We
provide services in circumstances where insurance or indemnification may not be available to us. Our existing insurance coverages may
not be sufficient or additional insurance may not be available to protect us against operational risks and other uncertainties that we
face. Liabilities or claims arising from our services in excess of any indemnity or insurance coverage (or for which indemnity or insurance
coverage is not available or is not obtained) could harm our financial condition, cash flows, and operating results. Any claim, even
if fully covered or insured, could negatively affect our reputation in the marketplace and make it more difficult for us to compete effectively.
The defense of such claims may be costly and time-consuming and could divert the attention of management.

 - 19 -

 We
indemnify our officers and directors against liability to us and our security holders, and such indemnification could increase our operating
costs.

 Our
certificate of incorporation and bylaws allow us to indemnify our officers and directors against claims associated with carrying out
the duties of their offices. Our bylaws also allow us to reimburse them for the costs of certain legal defenses. Insofar as indemnification
for liabilities arising under the Securities Act may be permitted to our officers, directors, or control persons, the SEC has advised
that such indemnification is against public policy and is therefore unenforceable.

 Our
industry is highly competitive, and there is no assurance that we will compete successfully.

 Our
current and potential competitors vary by size, service offerings, and geographic location. Competitors include technology companies,
consulting companies, telecommunication companies, technology resellers, hardware and software companies, and others. Many of our competitors
have entrenched relationships in particular industries or have gained a reputation for expertise in a specific sector of the cybersecurity
market, including services, software, and hardware. Primary competitive factors in our market include security, reliability and functionality;
customer service and technical expertise; reputation and brand recognition; financial strength; breadth of products and services offered;
price; and scalability. Many of our current and potential competitors have substantially greater financial, technical, and marketing
resources; more diversified product and service offerings; larger customer bases; longer operating histories; greater brand recognition;
and more established relationships in the industry than we do. As a result, some of these competitors may be able to:

 adapt
 more rapidly to new or emerging technologies and changes in customer requirements;

 develop
 superior products or services, thereby gaining greater market acceptance and expanding their product and service offerings more efficiently
 or rapidly;

 bundle
 products and services that we may not offer or in a manner that provides our competitors with a price advantage;

 take
 advantage of acquisitions and other opportunities more readily;

 maintain
 a lower cost basis;

 adopt
 more aggressive pricing policies and devote greater resources to the promotion, marketing, and sales of their products and services;
 and

 devote
 greater resources to the research and development of their products and services.

 Many
of these companies have significantly greater financial, technical, marketing, and other resources than we do and may be better positioned
to acquire, offer, and service complementary products and technologies. These companies and alliances resulting from possible combinations
may create more compelling product and service offerings; be able to offer greater pricing flexibility than we can; or engage in business
practices that make it more difficult for us to compete effectively, including on the basis of sales and marketing programs (such as
providing greater incentives to our channel partners to sell a competitor's product), technology, or product functionality. Competition
could result in, among other things, a substantial loss of customers, reduction in revenue, or increase in expenses, which could materially
adversely affect our business, financial condition, results of operations, or prospects.

 Our
success depends on our ability to protect our intellectual property and our proprietary technologies.

 We
rely on trade secrets to protect intellectual property, proprietary technology, and processes, which we have or may develop in the future.
There can be no assurances that secrecy obligations will be honored or that others will not independently develop similar or superior
technology. The protection of intellectual property and/or proprietary technology through claims of trade secret status has been the
subject of increasing claims and litigation by various companies both in order to protect proprietary rights as well as for competitive
reasons even where proprietary claims are unsubstantiated. The prosecution of proprietary claims or the defense of such claims is costly
and uncertain given the uncertainty and rapid development of the principles of law pertaining to this area. We may also be subject to
claims by other parties regarding the use of intellectual property, technology information, and data, which may be deemed proprietary
to others.

 - 20 -

 Increasingly
complex cybersecurity regulations and standards may have significant impact on our business, and it may require us to substantially invest
in our development capabilities to meet compliance requirements and may negatively impact our ability to offer certain services and remain
profitable.

 Federal
and state legislatures continue to advance policy proposals in recent years to address cyber threats directed at governments and private
businesses. As threats continue to evolve and expand and as the pace of new technologies accelerates, legislatures are making cybersecurity
measures a high priority. At the federal and state level, hundreds of bills or resolutions have been introduced and considered that deal
significantly with cybersecurity. These proposals are at multiple stages of development and may shape out new standards concerning different
areas. Our business expansion strategy focuses on accretive acquisitions of other cybersecurity service providers in the top thirty U.S.
markets to achieve greater service coverage. The complex regulatory environment in each state may require us to dedicate additional
resource to ensure our service scope and service quality are in compliance with the standards enacted in each state we operate business
in. We may incur additional legal and compliance costs, and our service scope may be restrained due to compliance requirements. This
will cause a delay in our service launch and negatively impact our operating results. We may also face litigations if we fail to respond
accordingly to these regulatory measures in certain states.

 We
may become subject to disputes, including litigation, that could negatively impact our business, profitability, and financial condition.

 We
may become subject to disputes with third parties from time to time. Any such dispute could result in litigation between us and the other
parties. Whether or not any dispute actually proceeds to litigation, we may be required to devote significant management time and attention
and financial resources to its resolution (through litigation, settlement, or otherwise), which would detract from our management's
ability to focus on our business. Any such resolution could involve the payment of damages or expenses by us, which may be significant.
In addition, any such resolution could involve our agreement with terms that restrict the operation of our business.

 If
we incur additional debt, we will be subject to restrictive covenants and debt service obligations that could negatively impact our operations.

 If
we incur additional debt for operations or acquisitions, a portion of our cash flow will have to be dedicated to the payment of principal
and interest on such indebtedness. Typical loan agreements also might contain restrictive covenants, which may impair our operating flexibility.
Such loan agreements would also provide for default under certain circumstances, such as failure to meet certain financial covenants.
A default under a loan agreement could result in the loan becoming immediately due and payable and, if unpaid, a judgment in favor of
such lender which would be senior to the rights of our stockholders. A judgment creditor would have the right to foreclose on any of
our assets resulting in a material adverse effect on our business, operating results, or financial condition.

 The
requirements of being a public company, including compliance with the reporting requirements of the Exchange Act and the requirements
of the Sarbanes-Oxley Act and Nasdaq, may strain our resources, increase our costs, and divert management's attention, and we may
be unable to comply with these requirements in a timely or cost-effective manner.

 As
a public company, we are subject to the reporting requirements of the Exchange Act, and the corporate governance standards of the Sarbanes-Oxley
Act and Nasdaq. We have a limited operating history as a public company, and these requirements may place a strain on our management,
systems, and resources. In addition, we have incurred, and expect to continue to incur, significant legal, accounting, insurance, and
other expenses. The Exchange Act requires us to file annual, quarterly, and current reports with respect to our business and financial
condition within specified time periods and to prepare a proxy statement with respect to our annual meeting of stockholders. The Sarbanes-Oxley
Act requires that we maintain effective disclosure controls and procedures and internal control over financial reporting. Nasdaq requires
that we comply with various corporate governance requirements. To maintain and improve the effectiveness of our disclosure controls and
procedures and internal control over financial reporting and comply with the Exchange Act and Nasdaq requirements, significant resources
and management oversight are required. This may divert management's attention from other business concerns and lead to significant
costs associated with compliance, which could have a material adverse effect on us and the market price of our common stock.

 The
expenses incurred by public companies generally for reporting and corporate governance purposes have been increasing. We expect these
rules and regulations to continue to increase our legal and financial compliance costs and to make some activities more time-consuming
and costly. These laws and regulations could also make it more difficult or costly for us to obtain certain types of insurance, including
director and officer liability insurance, and we may be forced to accept reduced policy limits and coverage or incur substantially higher
costs to obtain the same or similar coverage. These laws and regulations could also make it more difficult for us to attract and retain
qualified persons to serve on our Board of Directors or its committees or as our executive officers. Advocacy efforts by stockholders
and third parties may also prompt even more changes in governance and reporting requirements. We cannot predict or estimate the amount
of additional costs we may incur or the timing of these costs. Furthermore, if we are unable to satisfy our obligations as a public company,
we could be subject to delisting of our common stock, fines, sanctions, and other regulatory action and potentially civil litigation.

 - 21 -

 The
preparation of our financial statements involves use of estimates, judgments, and assumptions, and our financial statements may be materially
affected if our estimates prove to be inaccurate.

 Financial
statements prepared in accordance with accounting principles generally accepted in the United States require the use of estimates, judgments,
and assumptions that affect the reported amounts. Different estimates, judgments, and assumptions reasonably could be used that would
have a material effect on the financial statements, and changes in these estimates, judgments, and assumptions are likely to occur from
period to period in the future. These estimates, judgments, and assumptions are inherently uncertain, and, if they prove to be wrong,
then we face the risk that charges to income will be required.

 The
auditor's opinion on our audited consolidated financial statements for the year ended December 31, 2023, included in this
annual report on Form 10-K, contain an explanatory paragraph relating to our ability to continue as a going concern.

 The
auditor's opinion on our audited consolidated financial statements for the year ended December 31, 2023 includes an
explanatory paragraph stating that our losses and negative cash flows from operations and uncertainty in generating sufficient cash
to meet our operating obligations raise substantial doubt about our ability to continue as a going concern. While we are pursuing a
variety of funding sources and transactions that could raise capital, there can be no assurances that we will be successful in these
efforts or will be able to resolve our liquidity issues or eliminate our operating losses. If we are unable to obtain sufficient
funding, we would need to significantly reduce our operating plans and curtail some or all of our strategic plans. Accordingly, our
business, prospects, financial condition, and results of operations will be materially and adversely affected, and we may be unable
to continue as a going concern. If we are unable to continue as a going concern, we may have to liquidate our assets and may receive
less than the value at which those assets are carried on our audited consolidated financial statements, and it is likely that
investors will lose all or a part of their investment. If we seek additional financing to fund our business activities in the future
and there remains substantial doubt about our ability to continue as a going concern, investors or other financing sources may be
unwilling to provide additional funding on commercially reasonable terms or at all.

 Risks
Related to our Common Stock

 The
market price of our common stock is volatile and may fluctuate in a way that is disproportionate to our operating performance.

 Our
stock price may experience substantial volatility as a result of a number of factors, including, among others:

 sales
 or potential sales of substantial amounts of our common stock;

 announcements
 about us or about our competitors or new product introductions;

 the
 loss or unanticipated underperformance of our global distribution channels;

 litigation
 and other developments relating to our patents or other proprietary rights or those of our competitors;

 conditions
 in the cybersecurity and IT services industries;

 governmental
 regulation and legislation;

 variations
 in our anticipated or actual operating results;

 changes
 in securities analysts' estimates of our performance, or our failure to meet analysts' expectations;

 foreign
 currency values and fluctuations; and

 overall
 political and economic conditions.

 Many
of these factors are beyond our control. In addition to recent events, the stock markets have historically experienced substantial price
and volume fluctuations. These fluctuations often have been unrelated or disproportionate to the operating performance of these companies.
These broad market and industry factors could reduce the market price of our common stock, regardless of our actual operating performance.

 - 22 -

 Future
sales of shares of our common stock by existing stockholders could depress the market price of our common stock.

 We
had an aggregate of 11,949,959 issued and outstanding shares of common stock as of December 31, 2023. Approximately 4,303,871 shares
were in street name. The remainder of the outstanding shares may be sold, subject to certain volume limitations, pursuant to Rule 144
or other available exemptions. Also, in the future, we may issue additional securities in connection with financings and acquisitions.
The amount of our common stock issued in connection with an investment or acquisition could constitute a material portion of our then
outstanding stock. Due to these factors, sales of a substantial number of shares of our common stock in the public market could occur
at any time. These sales, or the perception in the market that the holders of a large number of shares intend to sell shares, could reduce
the market price of our common stock.

 Provisions
in our certificate of incorporation, our by-laws, and Delaware law might discourage, delay, or prevent a change in control of our company
or changes in our management and, therefore, depress the trading price of our common stock.

 Provisions
of our amended and restated certificate of incorporation, our amended and restated by-laws, and Delaware law may have the effect of deterring
unsolicited takeovers or delaying or preventing a change in control of our company or changes in our management, including transactions
in which our stockholders might otherwise receive a premium for their shares over then current market prices. In addition, these provisions
may limit the ability of stockholders to approve transactions that they may deem to be in their best interests. These provisions include
the ability of our Board of Directors to designate the terms of and issue new series of preferred stock without stockholder approval,
which could include the right to approve an acquisition or other change in our control or could be used to institute a rights plan, also
known as a poison pill, that would work to dilute the stock ownership of a potential hostile acquirer, likely preventing acquisitions
that have not been approved by our Board of Directors.

 The
existence of the forgoing provisions and anti-takeover measures could limit the price that investors might be willing to pay in the future
for shares of our common stock. They could also deter potential acquirers of our company, thereby reducing the likelihood that an investor
in our company could receive a premium for their common stock in an acquisition.

 Our
Board of Directors is expressly authorized to make, alter, or repeal our by-laws by majority vote, while such action by stockholders
would require a super majority vote.

 These
anti-takeover provisions and other provisions under Delaware law could discourage, delay, or prevent a transaction involving a change
in control of our company, including actions that our stockholders may deem advantageous, or negatively affect the trading price of our
stock. These provisions could also discourage proxy contests and make it more difficult for stockholders to elect directors of their
choosing and cause us to take other corporate actions they desire.

 FINRA
sales practice requirements may limit a stockholder's ability to buy and sell our stock.

 The
Financial Industry Regulatory Authority, Inc. ("FINRA") has adopted rules that require that, in recommending an investment
to a client, a broker-dealer must have reasonable grounds for believing that the investment is suitable for that customer. Prior to recommending
speculative low-priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information
about the customer's financial status, tax status, investment objectives, and other information. Under interpretations of these
rules, FINRA believes that there is a high probability that speculative low-priced securities will not be suitable for certain customers.
FINRA requirements will likely make it more difficult for broker-dealers to recommend that their customers buy our common stock, which
may have the effect of reducing the level of trading activity in the shares, resulting in fewer broker-dealers may be willing to make
a market in our shares, potentially reducing a stockholder's ability to resell shares of our common stock.

 - 23 -

 If
we issue additional shares in the future, it will result in the dilution of our existing stockholders.

 Our
amended and restated certificate of incorporation authorizes the issuance of up to 300,000,000 shares of our common stock and up to 50,000,000
shares of preferred stock. Our Board of Directors may choose to issue some or all of such shares to acquire one or more companies and
to fund our overhead and general operating requirements. The issuance of any such shares will reduce the book value per share and may
contribute to a reduction in the market price of the outstanding shares of our common stock. If we issue any such additional shares,
such issuance will reduce the proportionate ownership and voting power of all current stockholders. Further, such issuance may result
in a change of control of our company.

 We
are eligible to be treated as an "emerging growth company," as defined in the JOBS Act, and we cannot be certain if the reduced
disclosure requirements applicable to emerging growth companies will make our common stock less attractive to investors.

 We
are an "emerging growth company," as defined in the JOBS Act. For as long as we continue to be an emerging growth company,
we may take advantage of exemptions from various reporting and other requirements that are applicable to other public companies that
are not emerging growth companies, including (i) not being required to comply with the auditor attestation requirements of Section 404(b)
of the Sarbanes-Oxley Act, (ii) reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements,
and (iii) exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of
any golden parachute payments not previously approved. We could be an emerging growth company for up to five years, although circumstances
could cause us to lose that status earlier.

 In
addition, Section 107 of the JOBS Act provides that an emerging growth company can take advantage of the extended transition period provided
in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards that have different effective dates
for public and private companies until those standards apply to private companies. We have elected to take advantage of the extended
transition period for complying with the revised accounting standards. As a result, our financial statements may not be comparable to
companies that comply with effective dates generally applicable to public companies.

 Investors
may find our common stock less attractive because we may rely on these exemptions, reduced reporting requirements, and extended transition
periods. If investors find our common stock less attractive as a result of any of the foregoing, there may be a less active trading market
for our common stock and our stock price may be more volatile or may decrease.

 Our directors, a former director
and executive officers beneficially own a substantial majority of our outstanding capital stock and will have the ability to control our
affairs.

 Our current directors and executive officers, and a former director beneficially
own approximately 51.90% of our outstanding capital stock. By virtue of these holdings, they effectively control the election of the members
of our Board of Directors, our management, and our affairs and may prevent us from consummating corporate transactions such as mergers,
consolidations, or the sale of all or substantially all of our assets that may be favorable from our standpoint or that of our other stockholders.

 Our
failure to meet the continued listing requirements of Nasdaq could result in a delisting of our common stock.

 If
we fail to satisfy the continued listing requirements of Nasdaq, such as the corporate governance requirements or the minimum
closing bid price requirement, Nasdaq may take steps to delist our common stock. On March 29, 2023, we received a letter from the
listing qualifications staff of Nasdaq providing notification that the bid price for our common stock had closed below $1.00 per
share for the previous 30 consecutive business days and our common stock no longer met the minimum bid price requirement for
continued listing under Nasdaq Listing Rule 5550(a)(2). In accordance with Nasdaq Listing Rule 5810(c)(3)(A), we had an initial
period of 180 calendar days to regain compliance. To regain compliance, the closing bid price of our common stock had to be $1.00
per share or more for a minimum of 10 consecutive business days at any time before the expiration of the initial compliance period.
We were unable to regain compliance with Rule 5550(a)(2) during the initial compliance period, but pursuant to Nasdaq rules we were
eligible for an additional 180 calendar day compliance period. To qualify, we needed to meet the continued listing requirement for
market value of publicly held shares and all other initial listing standards for the Nasdaq Capital Market, with the exception of
the minimum bid price requirement, and we were required to provide written notice of our intention to cure the deficiency during the
second compliance period, by effecting a reverse stock split, if necessary. Subsequently, on December 28, 2023, we received a letter
from the listing qualifications staff of Nasdaq providing notification that the bid price for our common stock had closed below
$0.10 per share for the previous 10 consecutive trading days and our common stock no longer met the minimum bid price requirement
for continued listing under Nasdaq Listing Rule 5550(a)(2). Accordingly we were subject to the provisions contemplated under Nasdaq
Listing Rule 5810(c)(3)(A)(iii), and as a result, Nasdaq determined to delist our securities. We were granted an appeal with
Nasdaq's Hearings Panel on March 28, 2024. On March 8, 2024, our 1-for-15 reverse split became effective, increasing the bid
price for our common stock above $1.00 per share. On March 22, 2024, we received notification from Nasdaq that we had regained
compliance with the bid price requirements as set forth under Nasdaq Listing Rule 550(a)(2). As a result of regaining compliance,
our appeal with Nasdaq's Hearing Panel was cancelled.

 We must continue
to maintain a minimum closing bid price over $1.00 per share pursuant to Nasdaq Listing Rule 5810(c)(3)(A). If our closing bid price
falls below $1.00 per share for more than 30 consecutive trading days, we may again be deemed noncompliant with Nasdaq's
continued listing requirements.

 - 24 -

 The
liquidity of the shares of our common stock may be affected adversely by the reverse stock split undertaken to address such compliance
failure, given the reduced number of shares that are outstanding following a reverse stock split. In addition, reverse stock splits may
increase the number of stockholders who own odd lots (less than 100 shares) of our common stock, creating the potential for such stockholders
to experience an increase in the cost of selling their shares and greater difficulty effecting such sales.

 In
the event that we again become non-compliant with Rule 5550(a)(2) and cannot re-establish compliance
within the required timeframe, our common stock could be delisted from Nasdaq, which could have a material adverse effect on our financial
condition and which would cause the value of our common stock to decline. If our common stock is not eligible for listing or quotation
on another market or exchange, trading of our common stock could be conducted in the over-the-counter market or on an electronic bulletin
board established for unlisted securities such as the Pink Sheets or the OTC Bulletin Board. In such event, it would become more difficult
to dispose of, or obtain accurate price quotations for, our common stock, and there would likely be a reduction in our coverage by security
analysts and the news media, which could cause the price of our common stock to decline further. In addition, it may be difficult for
us to raise additional capital if we are not listed on a national securities exchange.

 Following
a reverse stock split, the resulting market price of our common stock may not attract new investors, including institutional investors,
and may not satisfy the investing requirements of those investors. Consequently, the trading liquidity of our common stock may not improve.

 Although
we believe that a higher market price of our common stock may help generate greater or broader investor interest, there can be no assurance
that a reverse stock split will result in a share price that will attract new investors, including institutional investors. In addition,
there can be no assurance that the market price of our common stock will satisfy the investing requirements of those investors. As a result,
the trading liquidity of our common stock may not necessarily improve.

 We
do not intend to pay dividends on our common stock.

 We
have never paid any cash dividends, and currently do not intend to pay any dividends for the foreseeable future. We intend to retain
any future earnings to the extent necessary to develop and expand our business. Payment of cash dividends, if any, will depend, among
other factors, on our earnings, capital requirements, and the general operating and financial condition, and will be subject to legal
limitations on the payment of dividends out of paid-in capital. Because we do not intend to declare dividends, any gain on an investment
in our company will need to come through an increase in the stock price. This may never happen, and investors may lose all of their investment.

 Our
business could be negatively impacted by shareholder activism.

 In
recent years, shareholder activists have become involved in numerous public companies. Shareholder activists frequently propose to involve
themselves in the governance, strategic direction, and operations of companies. Shareholder activists have also become increasingly concerned
with companies' efforts with respect to environmental, sustainability and governance standards. Responding to actions by activist
shareholders, such as requests for special meetings, potential nominations of candidates for election to our Board of Directors, requests
to pursue a strategic combination or other transaction, or other special requests may disrupt our business and divert the attention of
management and employees. In addition, any perceived uncertainties as to our future direction resulting from such a situation could result
in the loss of potential business opportunities, be exploited by our competitors, cause concern to our current or potential customers,
and make it more difficult to attract and retain qualified personnel and business partners, all of which could negatively impact our
business. Shareholder activism could result in substantial costs. In addition, actions of activist shareholders may cause significant
fluctuations in our stock price based on temporary or speculative market perceptions or other factors that do not necessarily reflect
the underlying fundamentals of our business.

 - 25 -

 Our
share price may be volatile, and you may be unable to sell your shares.

 The
trading price of our common stock is likely to be highly volatile and these fluctuations could cause you to lose all or part of your
investment in our common stock. Since shares of our common stock were sold in our initial public offering (IPO) in January 2021 at a
price of $75.00 (1) per share, the reported high and low sales prices of our common stock have ranged from $1.12 (1)
to $138.15 (1) per share through March 31, 2024. Factors that may cause the market price of our common stock to fluctuate include:

 price
 and volume fluctuations in the overall stock market from time to time;

 significant
 volatility in the market price and trading volume of technology companies in general, and of companies in our industry;

 actual
 or anticipated changes in our results of operations or fluctuations in our operating results;

 whether
 our operating results meet the expectations of securities analysts or investors;

 failure
 of securities analysts to initiate or maintain coverage of our company, changes in financial estimates or ratings by any securities
 analysts who follow our company, or our failure to meet the estimates or the expectations of investors;

 announcements
 of new products or technologies, commercial relationships, acquisitions, or other events by us or our competitors;

 actual
 or anticipated developments in our competitors' businesses or the competitive landscape generally;

 actual
 or perceived privacy or data security incidents;

 litigation
 involving us, our industry or both;

 regulatory
 developments in the U.S., foreign countries, or both;

 general
 economic conditions and trends;

 the
 commencement or termination of any share repurchase program;

 new
 laws or regulations or new interpretations of existing laws or regulations applicable to our business;

 the
 availability of our services, security breaches or perceived security breaches, and vulnerabilities;

 changes
 in accounting standards, policies, guidelines, interpretations, or principles;

 actions
 instituted by activist shareholders or others;

 major
 catastrophic events, including those resulting from war, incidents of terrorism, outbreaks of pandemic diseases, such as COVID-19,
 or responses to these events;

 sales
 of large blocks of our stock; or

 departures
 of key personnel.

 In
addition, if the market for technology stocks or the stock market in general experiences a loss of investor confidence, the trading price
of our common stock could decline for reasons unrelated to our business, operating results or financial condition. The trading price
of our common stock might also decline in reaction to events affecting other companies in our industry even if these events do not directly
affect us.

 In
the past, following periods of volatility in the market price of a company's securities, securities class action litigation has
often been brought against that company. If our stock price is volatile, we may become the target of securities litigation, which could
result in substantial costs and a diversion of management's attention and resources.

 (1) Share
price adjusted to reflect a 1-for-15 reverse stock split that occurred on March 8, 2024.

 ITEM
1B. UNRESOLVED STAFF COMMENTS

 None.

 ITEM
1C. CYBERSECURITY

 We
maintain a comprehensive process for identifying, assessing, and managing material risks from cybersecurity threats as part of our broader
risk management system and processes. We obtain input, as appropriate, for our cybersecurity risk management program on the security
industry and threat trends from multiple sources. Teams of dedicated security professionals oversee cybersecurity risk management and
mitigation, incident prevention, detection, and remediation. Leadership for these teams are professionals with deep cybersecurity expertise
across multiple industries, including our Chief Information Security Officer. Our executive leadership team, along with input from the
above teams, are responsible for our overall enterprise risk management system and processes and regularly consider cybersecurity risks
in the context of other material risks to the company.

 - 26 -

 As
part of our cybersecurity risk management system, our incident management teams track and log security incidents across our company
and our customers to remediate and resolve any such incidents. Significant incidents are reviewed by a cross-functional working
group to determine whether further escalation is appropriate. Any incident assessed as potentially being or potentially becoming
material is immediately escalated for further assessment and then reported to designated members of our senior management. We
consult with outside counsel as appropriate, including on materiality analysis and disclosure matters, and our senior management
makes the final materiality determinations and disclosure and other compliance decisions. Our management apprises our independent
registered public accounting firm of matters and any relevant developments.

 The
Audit Committee has oversight responsibility for risks and incidents relating to cybersecurity threats, including
compliance with disclosure requirements, cooperation with law enforcement, and related effects on financial and other risks, and reports
any findings and recommendations, as appropriate, to the full Board for consideration. Senior management regularly discusses cyber risks
and trends and, should they arise, any material incidents with the Chief Information Security Officer.

 Our
business strategy, results of operations and financial condition have not been materially affected by risks from cybersecurity threats,
including as a result of previously identified cybersecurity incidents, but we cannot provide assurance that they will not be materially
affected in the future by such risks or any future material incidents. For more information on our cybersecurity related risks, see Item
1A Risk Factors of this Annual Report on Form 10-K.

 ITEM
2. PROPERTIES

 Our
corporate headquarters is located in Scottsdale, Arizona where we currently lease approximately 3,300 square feet of office space. We
own office space in Santiago, Chile, which is primarily used for our secured managed services and administration in Latin America. We
lease additional offices, none of which we believe to be material to our operations, located throughout the United States and Chile for
our service delivery and administrative personnel.

 We
believe our existing facilities are sufficient for our current needs. Although we have recently closed or consolidated certain of our
facilities, in the future, we may need to add new facilities or expand our existing facilities to meet our evolving business needs.

 ITEM
3. LEGAL PROCEEDINGS

 We
are currently not a party to any material legal proceedings.

 ITEM
4. MINE SAFETY DISCLOSURES

 Not
applicable.

 - 27 -

 PART
II

 ITEM
5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

 Market
Information

 Until
January 13, 2022, our common stock was traded under OTC Market Group's OTCQB. Since January 13, 2022, our common stock has been
listed for trading on The Nasdaq Stock Market LLC under the symbol "CISO"

 As
of December 31, 2023, there were 765 holders of record of our common stock, and the last reported sale price of our common stock on
The Nasdaq Stock Market LLC on April 2, 2024 was $1.28. A significant number of shares of our common stock are held in either
nominee name or street name brokerage accounts, and consequently, we are unable to determine the total number of beneficial owners
of our common stock.

 Dividend
Policy

 To
date, we have paid no dividends on our common stock and do not expect to pay cash dividends in the foreseeable future. We plan to retain
all earnings to provide funds for the operations of our company. In the future, our Board of Directors will decide whether to declare
and pay dividends based upon our earnings, financial condition, capital requirements, and other factors that our Board of Directors may
consider relevant. We are not under any contractual restriction as to present or future ability to pay dividends.

 Unregistered
Sales of Equity Securities

 In
May 2023, we issued 200,000 shares (3,000,000 on a pre-reverse split basis) of our common stock to Trending Equities Corp. in
exchange for providing marketing and investor relations services.

 In
May 2023, we issued a warrant to Titan Partners Group, LLC, the Placement Agent for our registered direct offering, to purchase
40,000 shares (600,000 on a pre-reverse split basis) of our common stock at a price of $3.75 per share ($0.25 on a pre-reverse split basis). The warrant is exercisable
at any time on or after November 12, 2023, and expires on May 16, 2028.

 In
November 2023, we issued 133,334 (2,000,000 on a pre-reverse split basis) shares of our common stock to LendSpark Corporation as
additional consideration to enter into a loan agreement in which we received gross proceeds of $2,200,000.

 ITEM
6. [RESERVED]

 ITEM
7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 The
following Management's Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with
our consolidated financial statements and the related notes contained elsewhere in this Annual Report and is intended to provide information
necessary to understand our audited consolidated financial statements for the year ended December 31, 2023 compared to the year ended
December 31, 2022 and highlight certain other information which will enhance a reader's understanding of our financial condition,
changes in financial condition, and results of operations. In particular, the discussion is intended to provide an analysis of significant
trends and material changes in our financial position and the operating results of our business during the year ended December 31, 2023
compared to the year ended December 31, 2022. These historical consolidated financial statements may not be indicative of our future
performance. This Management's Discussion and Analysis of Financial Condition and Results of Operations contains numerous forward-looking
statements, all of which are based on our current expectations and could be affected by the uncertainties and risks described throughout
this filing, particularly in "Item 1A. Risk Factors."

 Our
Business

 We provide
a comprehensive suite of cybersecurity consulting and related services that encompass all three critical pillars: compliance, cybersecurity,
and organizational culture.

 Our services
include managed security, compliance assessments, SOC support, vCISO services, incident response, digital forensics, technical assessments,
and cybersecurity training. We've developed a unique offering called MCCP+ that delivers all three of these pillars through a dedicated
team of subject matter experts.

 Unlike many
cybersecurity firms focused on specific technologies or services, we remain technology-agnostic. Instead, we concentrate on building a
world-class team of cybersecurity and compliance experts with diverse skillsets. Our goal is to provide our clients with truly holistic
solutions that address the chronic shortage of highly skilled cybersecurity professionals.

 Underpinning
our services is a steadfast belief that establishing a strong culture of security is essential for organizational resilience. We work
closely with our clients to cultivate this security-first mindset, helping them quantify the return on their cybersecurity investments.

 We have
developed innovative software-based IP powered by machine learning, AI, and dark web threat intelligence. These multilayered technologies
aim to enhance cyber effectiveness and drive greater resiliency for enterprises.

 With a
comprehensive portfolio of scalable IP solutions and an end-to-end team of experts, we are poised for organic growth. By optimizing
the user experience and leveraging digital interfaces, we can expand our client base without adding strain to our services team.
This scalability will enable us to drive increased revenue and margins concurrently.

 - 28 -

 Financial
Highlights

 Our
operating results for the year ended December 31, 2023 included the following:

 Total
 revenue increased by $10.5 million to $57.1 million for the year ended December 31, 2023, as compared to the year ended December
 31, 2022.

 Total
 gross profit increased by $3.3 million to $6.0 million for the year ended December 31, 2023, as compared to the year ended December
 31, 2022.

 Results
of Operations

 Comparison
of the Year Ended December 31, 2023, to the Year Ended December 31, 2022

 Our
financial results for the year ended December 31, 2023 are summarized as follows in comparison to the year ended December 31, 2022:

 For the Year Ended

 Variance

 Revenue:

 $
 50,078,925

 $
 40,920,420

 $
 9,158,505

 6,979,832

 5,629,197

 1,350,635

 Total revenue

 57,058,757

 46,549,617

 10,509,140

 Cost of revenue:

 23,671,605

 15,431,523

 8,240,082

 900,582

 844,287

 56,295

 Cost of payroll

 21,613,207

 20,036,182

 1,577,025

 Stock based compensation

 4,823,829

 7,512,304

 (2,688,475
)

 Total cost of revenue

 51,009,223

 43,824,296

 7,184,927

 Total gross profit

 6,049,534

 2,725,321

 3,324,213

 Operating expenses:

 Professional fees

 3,695,187

 2,067,603

 1,627,584

 Advertising and marketing

 474,121

 804,218

 (330,097
)

 Selling, general and administrative

 26,744,543

 23,106,451

 3,638,092

 Stock-based compensation

 7,712,671

 9,885,191

 (2,172,520
)

 Impairment of goodwill

 45,194,717

 -

 45,194,717

 Total operating expenses

 83,821,239

 35,863,463

 47,957,776

 Loss from operations

 (77,771,705
)

 (33,138,142
)

 (44,633,563
)

 Other income (expense):

 Other income (expense)

 (13,640
)

 43,332

 (56,972
)

 Interest expense, net

 (2,881,416
)

 (680,921
)

 (2,200,495
)

 Total other income (expense)

 (2,895,056
)

 (637,589
)

 (2,257,467
)

 Loss before income taxes

 $
 (80,666,761
)

 $
 (33,775,731
)

 $
 (46,891,030
)

 - 29 -

managed services revenue increased by $9,158,505, or 22%, for the year ended December 31, 2023, as compared to the year ended December
31, 2022, primarily due to having a full year of ownership of CUATROi and NLT Secure, and new and existing
customer revenue growth.

 Professional
services revenue increased by $1,350,635, or 24%, for the year ended December 31, 2023, as compared to the year ended December 31, 2022,
primarily due to having a full year of ownership of CUATROi and NLT Secure.

 Expenses

 Cost
of Revenue

managed services cost of revenue increased by $8,240,082, or 53%, for the year ended December 31, 2023, as compared to the year ended
December 31, 2022, due primarily to having a full year of ownership of CUATROi and NLT Secure compared to only four months in 2022, which increased our revenues from hardware
and software sales and their related costs.

 Professional
services cost of revenue increased by $56,295, or 7%, for the year ended December 31, 2023, as compared to the year ended December 31,
2022, due to our increase in revenue from professional services from having a full year of ownership of CUATROi and NLT Secure compared to only four months in 2022.

 Cost
of payroll increased by $1,577,025, or 8%, for the year ended December 31, 2023, as compared to the year ended December 31, 2022, due
to headcount costs of CUATROi and NLT Secure having a full year of ownership compared to only four months in 2022.

 Stock-based
compensation decreased by $2,688,475, or 36%, for the year ended December 31, 2023, as compared to the year ended December 31, 2022,
due to the timing of recognition of the reversal of expense for options forfeited by former employees, a decrease in the number of options
granted in 2023, and a decline in the fair value of new options granted resulting from the decline in our share price.

 Operating
Expenses

 Professional
fees increased by $1,627,584, or 79%, for the year ended December 31, 2023, as compared to the year ended December 31, 2022, due to an
increase in accounting, legal and other professional fees incurred related to our periodic SEC filings and our efforts to raise additional
capital, offset by a reduction in accounting and audit fees.

 Advertising
and marketing expenses decreased by $330,097, or 41%, for the year ended December 31, 2023, as compared to December 31, 2022, due to utilizing internal resources
for advertising and marketing activities.

 Selling,
general, and administrative expenses increased $3,638,092, or 16%, for the year ended December 31, 2023, as compared to the year
ended December 31, 2022, due to the costs of CUATROi and NLT Secure having a full year of ownership compared to only four months in
2022.

 Stock-based
compensation expenses decreased by $2,172,520, or 22%, for the year ended December 31, 2023, as compared to the year ended December 31,
2022, due to the timing of recognition of the reversal of expense for options forfeited by former employees, a decrease in the number
of options granted in 2023, and a decline in the fair value of new options granted resulting from the decline in our share price.

 - 30 -

 Impairment
of goodwill increased by $45,194,717, or 100%, for the year ended December 31, 2023, as compared to the year ended December 31,
2022, due to the fair value of our reporting units falling below their carrying value in 2023, whereas in the carrying fair value of
these reporting units exceeded their carrying value in 2022.

 Other
Income (Expense)

 Interest
expense, net increased by $2,200,495, or 323%, during the year ended December 31, 2023, as compared to the year ended December 31, 2022,
due to an increase in our debt assumed through acquisitions during 2022 and obtaining short-term loans to fund operating capital in 2023.

 Working
Capital

 Our
working capital as of December 31, 2023, as compared to our working capital as of December 31, 2022, is summarized as follows:

 As of

 Current assets

 $
 10,957,814

 $
 14,398,795

 Current liabilities

 26,071,102

 23,213,039

 Working capital (deficit)/surplus

 $
 (15,113,288
)

 $
 (8,814,244
)

 The
decrease in current assets is primarily due to a decrease in cash and cash equivalents, accounts receivable and prepaid expenses and
other current assets of $770,721, $2,176,570, and $524,379 respectively. The increase in current liabilities is primarily due to the
increase in accounts payable and accrued expenses of $7,640,990, offset by a decrease in loans and convertible notes payable of $4,567,367

 Cash
Flows

 Our
cash flows for the year ended December 31, 2023, as compared to our cash flows for the year ended December 31, 2022, can be summarized
as follows:

 Year Ended December 31,

 2023

 2022

 Net cash used in operating activities

 $
 (5,920,112
)

 $
 (10,681,007
)

 Net cash used in investing activities

 (160,158
)

 (6,048,944
)

 Net cash provided by financing activities

 6,193,046

 15,777,909

 Effect of exchange rates on cash and cash equivalents

 (883,497
)

 60,170

 Decrease in cash

 $
 (770,721
)

 $
 (891,872
)

 Operating
Activities

 Net
cash used in operating activities was $5,920,112 for the year ended December 31, 2023 and was primarily due to cash used to fund a net
loss of $80,231,083, adjusted for non-cash expenses in the aggregate of $64,085,528 and additional cash increases from changes in the
levels of operating assets and liabilities in the aggregate of $10,225,443, primarily as a result of an increase in accounts receivable,
accounts payable and accrued expenses, and deferred revenue. Net cash used in operating activities was $10,681,007 for the year ended
December 31, 2022 and was primarily due to cash used to fund a net loss of $33,775,182, adjusted for non-cash expenses in the aggregate
of $20,752,668 and additional cash increases from changes in the levels of operating assets and liabilities in the aggregate of $2,341,507,
primarily as a result of an increase in accounts payable and other deferred revenue.

 Investing
Activities

 Net
cash used in investing activities of $160,158 for the year ended December 31, 2023, was primarily due to cash paid to purchase
property and equipment. Net cash used in investing activities of $6,048,944 for the year ended December 31, 2022, was primarily due
to cash paid as part of the acquisition of True Digital.

 - 31 -

 Financing
Activities

 Net
cash provided by financing activities for the year ended December 31, 2023 was $6,193,046, which was primarily due to cash received from
the sale of our common stock, and net proceeds from loans and convertible notes payable of $6,655,493 and $11,975,631, respectively,
and offset by the payment of loans and convertible notes payable of $12,929,931. Net cash provided by financing activities for the year
ended December 31, 2022 was $15,777,909, which was primarily due to cash received from the sale of our common stock, and net proceeds
from loans and notes payable of $10,689,087 and $6,061,585, respectively, and offset by the payment of loans of $2,452,905.

 Liquidity

 The
accompanying consolidated financial statements have been prepared on the basis that we will continue as a going concern, which contemplates
realization of assets and satisfying liabilities in the normal course of business. At December 31, 2023, we had an accumulated deficit
of $158,018,687 and working capital deficit of $15,113,288. For the year ended December 31, 2023, we had negative cash flows from operations of $5,920,112. Although our company is showing positive revenue and gross profit trends, we expect
to incur further losses through the end of 2024.

 To
date, we have funded operations primarily through the sale of equity in public offerings, private placements, loan proceeds, and revenue
generated by our services. During the year ended December 31, 2023, we received $6,655,493 from public and private offerings of our common
stock, $11,975,631 in net proceeds from our loans and convertible notes payable, and $491,853 from the exercise of stock options. On
June 27, 2022, our Registration Statement on Form S-3 was declared effective, and we may offer and sell from time to time, in one or
more series, any of our securities, for total gross proceeds up to $300,000,000. As of December 31, 2023, we had $291,351,048 of available
funding from our S-3 Registration Statement from which we may issue our securities to fund current and future operations.

 Going
Concern

 The
accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction
of liabilities in the normal course of business. However, due to losses incurred, substantial doubt about the Company's ability
to continue as a going concern exists.

 We
are evaluating strategies to obtain the required additional funding for future operations. These strategies may include, obtaining equity
financing, issuing debt or entering into other financing arrangements, and restructuring of operations to grow revenues and decrease
expenses. However, we may be unable to access further equity or debt financing when needed. As such, there can be no assurance that we
will be able to obtain additional liquidity when needed or under acceptable terms, if at all.

 The
ability for us to continue as a going concern is dependent upon our ability to successfully accomplish the plan described in the Growth
Strategy paragraph and eventually attain profitable operations. The consolidated financial statements do not include any adjustments
to the carrying amounts and classification of assets, liabilities, and reported expenses that may be necessary if the Company were unable
to continue as a going concern.

 Recently
Issued Accounting Pronouncements

 See
Note 3 to our consolidated financial statements for the years ended December 31, 2023 and 2022 included elsewhere in this Annual Report.

 - 32 -

 Critical
Accounting Policies and Estimates

 Use
of Estimates

 The
preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of contingent liabilities at dates of the financial statements and the reported
amounts of revenue and expenses during the periods. Our significant estimates and assumptions include the recoverability and useful lives
of long-lived assets, stock-based compensation, and the valuation allowance related to our deferred tax assets. Certain of our estimates,
including the carrying amount of intangible assets and goodwill, could be affected by external conditions, including those unique to
us and general economic conditions. It is reasonably possible that these external factors could have an effect on our estimates and could
cause actual results to differ from those estimates.

 Fair
Value Measurement

 The
fair value measurement guidance clarifies that fair value is an exit price, representing the amount that would be received to sell an
asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement
that should be determined based on assumptions that market participants would use in the valuation of an asset or liability. It establishes
a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest
priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority
to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy under the fair value measurement guidance
are described below:

 Level
1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities;

 Level
2 - Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the
full term of the asset or liability; or

 Level
3 - Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported
by little or no market activity).

 Business
Combination

 We
allocate the purchase price of an acquired business to the tangible and intangible assets acquired and liabilities assumed based upon
their estimated fair values on the acquisition date. Any excess of the purchase price over the fair value of the net assets acquired
is recorded as goodwill. The purchase price allocation process requires management to make significant estimates and assumptions, especially
at the acquisition date with respect to intangible assets. Direct transaction costs associated with the business combination are expensed
as incurred. The allocation of the consideration transferred in certain cases may be subject to revision based on the final determination
of fair values during the measurement period, which may be up to one year from the acquisition date. We include the results of operations
of the business that it has acquired in its consolidated results prospectively from the date of acquisition.

 If
the business combination is achieved in stages, the acquisition date carrying value of the acquirer's previously held equity interest
in the acquiree is re-measured to fair value at the acquisition date; any gains or losses arising from such re-measurement are recognized
in profit or loss.

Assets

assets are comprised of trademarks, customer bases, non-compete agreements and intellectual property with original estimated useful lives
with a range of 2 to 15 years. Once placed into service, we amortize the cost of the intangible assets over their estimated useful lives
on a straight-line basis.

represents the excess of the purchase price of the acquired business over the estimated fair value of the identifiable net assets
acquired. Goodwill is not amortized but is tested for impairment at least annually at year end, at the reporting unit level or more
frequently if events or changes in circumstances indicate that the asset might be impaired. Goodwill is tested for impairment at the
reporting level by first performing a qualitative assessment to determine whether it is more likely than not that the fair value of
the reporting unit is less than its carrying value. If the reporting unit does not pass the qualitative assessment, then the
reporting unit's carrying value is compared to its fair value. The fair values of the reporting units are estimated using a
market approach. Goodwill is considered impaired if the carrying value of the reporting unit exceeds its fair value. Failure to maintain a similar market value may cause a future impairment
of goodwill at the reporting unit.

 - 33 -

 Impairment
of Long-lived Assets

 We
will periodically evaluate the carrying value of long-lived assets to be held and used when events and circumstances warrant such a review
and at least annually. The carrying value of a long-lived asset is considered impaired when the anticipated undiscounted cash flow from
such asset is separately identifiable and is less than its carrying value. In that event, a loss is recognized based on the amount by
which the carrying value exceeds the fair value of the long-lived asset. Fair value is determined primarily using the anticipated cash
flows discounted at a rate commensurate with the risk involved. Losses on long-lived assets to be disposed of are determined in a similar
manner, except that fair values are reduced for the cost to dispose.

 Stock-Based
Compensation

 We measure and recognize compensation
expense for equity-based awards based on the grant date fair values of the awards. For options with service or performance-based vesting
conditions, the grant date fair value is estimated using the Black-Scholes option-pricing model, which requires management to make assumptions
and apply judgment in determining the grant date fair value.

 The most significant assumptions
and judgments include estimating the expected option term, the expected stock price volatility and the risk-free interest rates. The assumptions
used in our option pricing model represent management's best estimates. If factors change and different assumptions are used, our equity-based
compensation expense could be materially different in the future. We record forfeitures when they occur, based on our lack of historical
data available to estimate an appropriate forfeiture rate. Changes in our forfeiture rate can have a significant impact on our equity-based
compensation expense since the cumulative effect of adjusting the forfeiture rate is recognized in the period in which the estimate is
changed.

 We will continue
to use judgment in evaluating the assumptions related to our equity-based awards on a prospective basis. As we continue to accumulate
additional data related to our awards, we may refine our estimates, which could materially impact our future equity-based compensation
expense.

Recognition

 Our
agreements with clients are primarily service contracts that range in duration from a few months to three years. We recognize revenue
when control of these services is transferred to the client for an amount, referred to as the transaction price, which reflects the
consideration to which we are expected to be entitled in exchange for those goods or services.

 A
contract with a client exists only when:

 the
 parties to the contract have approved it and are committed to perform their respective obligations;

 we
 can identify each party's rights regarding the distinct services to be transferred ("performance obligations");

 we
 can determine the transaction price for the services to be transferred; and

 the
 contract has commercial substance, and it is probable that we will collect the consideration to which it will be entitled in exchange
 for the goods or services that will be transferred to the client.

 We
do not adjust the promised amount of consideration for the effects of a significant financing component since we expect, at contract
inception, that the period between the time of transfer of the promised goods or services to the client and the time the client pays
for these goods or services to be generally one year or less. Our credit terms to clients generally average thirty days, although in
some cases payments are required in 15 days.

 We
do not disclose the value of unsatisfied performance obligations for contracts with original expected duration of one year or less.

 See
Note 3 to our consolidated financial statements for the years ended December 31, 2023 and 2022 included elsewhere in this Annual Report
for additional information regarding revenue recognition and deferred revenue.

 Reimbursed
Expenses

 We
include reimbursed expenses in revenue and costs of revenue as we are primarily responsible for fulfilling the promise to provide the
specified service, including the integration of the related services into a combined output to the client, which are inseparable from
the integrated service. These costs include such items as consumables, transportation and travel expenses, over which we have discretion
in establishing prices.

 - 34 -

 Costs
of Revenue

 Costs
of revenue include (i) compensation and benefits for billable employees and consultants directly involved with delivering services offerings
and engagements; (ii) consumables used for the services; and (iii) other expenses directly related to service contracts such as professional
services, meals and travel expenses.

 Volatility
in Stock-Based Compensation

 We determine the expected stock
price volatility based on the historical volatilities of our peer group, blended with our historical volatility, since there is not a
sufficient trading history for our common stock. Industry peers consist of several public companies in the technology industry similar
to us in size, stage of life cycle and financial leverage. We intend to continue to consistently apply this process using the same or
similar public companies and continue increasing the blended proportion of our historical volatility until a sufficient trading history
of our common stock becomes available. If circumstances change such that the identified companies are no longer similar to us, we will
revise our peer group to substitute more suitable companies in this calculation.

 Off-Balance
Sheet Arrangements

 We
have no off-balance sheet arrangements that have or are reasonably likely to have a material current or future effect on our financial
condition, changes in financial condition, revenue or expenses, results of operations, liquidity, capital expenditures, or capital resources.

 ITEM
7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 Because
we are a smaller reporting company, we are not required to provide the information called for by this Item.

 ITEM
8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

 The
information called for by Item 8 is included beginning on page F-1 contained in this Annual Report on Form 10-K.

 ITEM
9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

 None.

 ITEM
9A. CONTROLS AND PROCEDURES

 Evaluation
of Disclosure Controls and Procedures

 We
maintain disclosure controls and procedures (as that term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) that are
designed to ensure that information required to be disclosed in our reports 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 Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding
required disclosures. In designing disclosure controls and procedures, our management necessarily was required to apply its judgment
in evaluating the cost-benefit relationship of possible disclosure controls and procedures. The design of any disclosure controls and
procedures also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any
design will succeed in achieving its stated goals under all potential future conditions. Any controls and procedures, no matter how well
designed and operated, can provide only reasonable, not absolute, assurance of achieving the desired control objectives.

 Our
management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the
design and operation of our disclosure controls and procedures as of the end of the period covered by this report. Based on this evaluation,
our CEO and CFO concluded that, as of December 31, 2023, our disclosure controls and procedures are designed at a reasonable assurance
level and are effective to provide reasonable assurance that information we are required to disclose in reports 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 CEO and CFO, as appropriate, to allow timely
decisions regarding required disclosure.

 Description
of Material Weakness as of December 31, 2022

 The
ineffectiveness of our internal control over financial reporting was due to the following material weaknesses which are indicative of
many small companies with small number of staff:

 lack
 of risk assessment procedures on internal controls to detect financial reporting risks in a timely manner; and

 lack
 of documentation on policies and procedures that are critical to the accomplishment of financial reporting objectives.

 - 35 -

 Remediation

 As
a result of identification of the material weakness noted above, we implemented a remediation plan that addressed the material
weakness in internal control over financial reporting. We designed, documented, and implemented new controls to assess risks on
internal controls over financial reporting and policies and procedures critical to financial reporting objectives. We have evaluated
the design and operating effectiveness of the controls implemented and concluded that the controls are adequately designed and have
operated effectively for a sufficient period to conclude that the material weakness has been remediated.

 Limitations
on Effectiveness of Controls and Procedures

 Because
of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. In addition, projections
of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in
conditions or that the degree of compliance with the policies or procedures may deteriorate.

 Changes
in Internal Control Over Financial Reporting

the year ended December 31, 2023, we completed formal risk assessment procedures and documentation of policies and
procedures critical to the accomplishment of financial reporting objectives.

 Other
than the remediation of our material weakness, there have been no changes in our internal control over financial reporting (as defined
in Rule 13a-15(f) and 15d-15(f) under the Exchange Act) during the year ended December 31, 2023, that have materially affected, or that
are reasonably likely to materially affect, our internal control over financial reporting.

 Management's
Report on Internal Control over Financial Reporting

 Our
management is responsible for establishing and maintaining adequate internal control over financial reporting based on the framework
established in Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway
Commission. Our internal control over financial reporting is a process designed under the supervision of its principal executive and
principal financial officers and effected by our Board of Directors, management and other personnel, to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of its consolidated financial statements for external reporting
purposes in accordance with U.S. generally accepted accounting principles. Based on our assessment under this framework, our management
concluded that our internal control over financial reporting was effective as of December 31, 2023.

 Our
independent registered public accounting firm will not be required to report on the effectiveness of our internal control over
financial reporting pursuant to Section 404 until we are no longer an "emerging growth company" nor a non-accelerated
filer.

 ITEM
9B. OTHER INFORMATION

 Not
applicable.

 ITEM
9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

 Not
applicable.

 - 36 -

 PART
III

 ITEM
10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

 The
following table sets forth certain information regarding our Directors and Executive Officers. The age of each Director and Executive
Officer listed below is given as of April 9, 2024.

 Name

 Age

 Position

 David
 G. Jemmett

 Chief
 Executive Officer and Director

 Kyle
 J. Young

 Interim
 Chief Operating Officer

 Debra
 L. Smith

 Chief
 Financial Officer and Director

 Ret.
 General Robert C. Oaks (3)

 Reid
 S. Holbrook (1) (2) (3)

 Andrew
 K. McCain (1) (2)

 Ernst
 M. (KiKi) VanDeWeghe, III (1) (2) (3)

 Brett
 Chugg

 (1)

 Member
 of the Audit Committee

 (2)

 Member
 of the Compensation Committee

 (3)

 Member
 of the Governance and Nominating Committee

 Our
Executive Officers

 David
G. Jemmett – Chief Executive Officer and Director

 Mr.
Jemmett has served as our Chief Executive Officer and a director of our company since our formation in March 2019. He also founded GenResults
in June 2015, which we subsequently acquired in April 2019. From January 2014 to December 2014, Mr. Jemmett served as Chief Executive
Officer of NantCloud, LLC, a provider of secure cloud-hosted applications for healthcare customers, and Chief Technology Officer of NantWorks,
LLC, a parent company for the "Nant" family of companies. From 2005 to 2013, Mr. Jemmett served as founder and Chief Executive
Officer of ClearDATA Networks Corporation, a HIPAA compliant hosting company specializing in healthcare. He has been a guest speaker
on CBS, CNN, MSNBC and CSPAN, and has spoken before the U.S. Senate Subcommittee on Telecommunications and Internet Security regarding
internet technologies in 1998.

 We
believe Mr. Jemmett is qualified to serve as a director of our company due to his extensive business background, his experience in the
cybersecurity industry, and his significant equity ownership in our company.

 Kyle
J. Young – Interim Chief Operating Officer

 Mr.
Young has served as our Interim Chief Operating Officer since March 2023. Previously Mr. Young served as our Executive Vice President,
Operations from January 2022 to March 2023 and as our Vice President, Operations from February 2021 to January 2022. Mr. Young served
in various roles at BeyondTrust Software, a U.S.-based cybersecurity vendor, from December 2007 to February 2022, most recently serving
as its Vice President, Business and Sales Operations. Mr. Young holds a bachelor's degree in Speech Communications & Rhetoric
from the University of Illinois Urbana-Champaign.

 Debra
L. Smith – Chief Financial Officer and Director

 Ms.
Smith has served as our Chief Financial Officer since June 2021. Ms. Smith served as our Executive Vice President of Finance and Accounting
from February 2021 to June 2021. Prior to joining our company, Ms. Smith served as Executive Vice President of Finance at Arrivia Inc.
from January 2020 to February 2021 and Controller and, subsequently, Chief Accounting Officer at BeyondTrust from October 2016 to January
2020. Ms. Smith received a Bachelor of Science degree in Accounting, Summa Cum Laude, from DeVry University and a Master's degree
in Counseling with Honors from Argosy University.

 - 37 -

 Our
Directors

 Ret.
General Robert C. Oaks – Director

 Ret.
General Oaks has served as a director of our company since May 2019. He is a retired U.S. Air Force general who served as commander in
chief of the U.S. Air Forces in Europe, and commander, Allied Air Forces Central Europe, with headquarters at Ramstein Air Base, Germany.
He retired as a four-star General and Commander and Chief of U.S. Air Forces Europe and NATO Central Europe in 1994 after serving 34
years. Following his retirement, Ret. General Oaks was employed at U.S. Airways as Senior Vice President from 1994 to 2000. In 2000,
Oaks resigned from this position when he was called to serve the LDS Church, where he served until 2009, when he was released as a general
authority. He earned a Bachelor of Science degree in Military Science from the U.S. Air Force Academy and a Master's degree in
Business Administration from Ohio State University prior to graduating from the Naval War College. Ret. General Oaks currently serves
as the official Liaison for the Church of Jesus Christ to the U.S. Armed Forces.

 We
believe Ret. General Oaks is qualified for service as a director of our company due to his experience with national security issues,
including cybersecurity, through his extensive military service.

 Reid S. Holbrook – Director

 Mr.
Holbrook has served as a director of our company since May 2019. Since 2013, Mr. Holbrook has been a Principal at Mountain Summit Advisors,
a specialty firm focused on mergers and acquisitions of primarily healthcare technology and services companies, and a strategic advisor
to Health Catalyst, a company focused on data analytics and warehousing primarily in healthcare. He served as the Executive Vice President
of Medicity, a population health management company with solutions for health information exchange, business intelligence, and provider
and patient engagement, from 2002 to 2013. In 1998, Mr. Holbrook founded KLAS where he remains as a board member. He has served in executive
positions at IHC, GTE, Sunquest Information Systems, Integrated Medical Networks and is a founder of Park City Solutions. Mr. Holbrook
is a HIMSS Fellow. He holds a Master of Science from Utah State University and a Bachelor of Science from Brigham Young University.

 We
believe Mr. Holbrook is qualified for service as a director of our company as a result of his significant experience in the healthcare
technology sector.

 Andrew
K. McCain – Director

 Mr.
McCain has served as a director of our company since May 2019. He has served as the President and Chief Executive Officer for Hensley
Beverage Company since January 2024, and previously served as President and Chief Operating Officer from 2014 through January 2024. He
is a board member of the Arizona Super Bowl Host Committee, the Arizona 2016 College Football Championship Local Organizing Committee,
Chairman of Hensley Employee Foundation, and a Patrons Committee member of United Methodist Outreach Ministries' New Day Centers.
He is past Chairman of the Board of the Fiesta Bowl, past Chairman of the Anheuser-Busch National Wholesaler Advisory Panel, and past
Chairman of the Greater Phoenix Chamber of Commerce. Mr. McCain received his Bachelor of Arts in Mathematics in 1984 and an MBA in 1986
from Vanderbilt University.

 We
believe Mr. McCain is qualified for service as a director of our company due to his significant business experience and leadership.

 Ernst
M. (Kiki) VanDeWeghe, III – Director

 Mr.
VanDeWeghe has served as a director of our company since May 2021. He has served as the Executive Vice President, Basketball Operations
of the National Basketball Association since 2013. Prior to that, Mr. VanDeWeghe was the general manager of the Denver Nuggets and the
New Jersey Nets and a head coach of the New Jersey Nets. Prior to that he played professionally for the Los Angeles Clippers, New York
Knicks, Portland Trail Blazers, and the Denver Nuggets. Mr. VanDeWeghe attended UCLA where he received a degree in Economics.

 We
believe Mr. VanDeWeghe is qualified for service as a director of our company due to his business acumen and experience as an organizational
leader.

 - 38 -

 Brett
Chugg – Director

 Mr.
Chugg has served as a director of our company since February 2024. He has most recently served as Senior Managing Director at Koch Disruptive
Technologies, a venture and growth equity investment group at Koch Industries and in other roles with Koch Industries since 1998. Mr.
Chugg has also served as a Director on several high-growth company boards. Mr. Chugg attended Weber State University where he received
a degree in English and received his MBA in 1998 from Bringham Young University.

 We believe Mr.
Chugg is qualified to serve as a director due to his experience as an investor and leader in technology with global and multi-industry
experience.

 Board
Constitution

 Our
Board of Directors currently consists of seven members. All directors hold office until the next annual meeting of stockholders. At each
annual meeting of stockholders, the successors to directors whose terms then expire are elected to serve from the time of election and
qualification until the next annual meeting following election.

Independence

 Our
Board of Directors is comprised of a majority of independent directors, as "independence," is defined by the listing standards
of The Nasdaq Stock Market and by the SEC. Our Board of Directors has concluded that each of Messrs. Oaks, Holbrook, McCain, and Mr.
VanDeWeghe are "independent", having concluded that any relationship between such director and our company, in its opinion,
does not interfere with the exercise of independent judgment in carrying out the responsibilities of a director. Mr. Jemmett and Ms.
Smith are employee directors. Mr. Scott served on our Board of Directors since April 2019 and resigned in May 2023. Mr. Scott was an
independent director.

 Board
Committees

 Our
Board of Directors has three standing committees: the Audit Committee, the Compensation Committee, and Governance and Nominating Committee.

 Audit
Committee

 The
Audit Committee of our Board of Directors was established in accordance with Rule 10A-3 promulgated under the Exchange Act. The current
members of our Audit Committee are Messrs. McCain, Holbrook, and VanDeWeghe, with Mr. McCain serving as the chair. Each member of the
Audit Committee meets the independence and other requirements to serve on our Audit Committee under The Nasdaq Stock Market Rules and
the rules of the SEC. In addition, our Board of Directors determined that each of Messrs. McCain and Holbrook is considered an "audit
committee financial expert" as defined in the rules of the SEC.

 The
Audit Committee was formed in 2021. Our Board of Directors has adopted a written charter for the Audit Committee, a copy of which is
posted in the Investor Resources and Corporate Governance section of our website at www.ciso.inc/investor-relations/charter-of-the-audit-committee.
The principal functions of the Audit Committee are to oversee our accounting and financial reporting processes and the audits of our
consolidated financial statements; oversee our relationship with our independent auditors, including selecting, evaluating, and setting
the compensation of, and approving all audit and non-audit services to be performed by the independent auditors; and facilitate communication
among our independent registered public accounting firm and our financial and senior management.

 Compensation
Committee

 We
have a standing Compensation Committee of our Board of Directors. The members of our Compensation Committee are Messrs. Holbrook, VanDeWeghe,
and McCain, with Mr. Holbrook serving as the chair. Each member of the Compensation Committee meets the independence and other requirements
to serve on our Compensation Committee under The Nasdaq Stock Market Rules and the rules of the SEC.

 The
Compensation Committee was formed in 2021. Our Board of Directors has adopted a written charter for the Compensation Committee, a copy
of which is posted in the Investor Resources and Corporate Governance section of our website at www.ciso.inc/investor-relations/charter-of-the-compensation-committee.
The Compensation Committee has responsibilities relating to the performance evaluation and the compensation of our Chief Executive Officer;
the compensation of our executive officers and directors; and our significant compensation arrangements, plans, policies, and programs,
including our stock compensation plans. Certain of our executive officers, our outside counsel, and consultants may occasionally attend
the meetings of the Compensation Committee. However, no officer of our company is present during discussions or deliberations regarding
that officer's own compensation.

 - 39 -

 Governance
and Nominating Committee

 We
have a standing Governance and Nominating Committee of our Board of Directors. The current members of our Governance and Nominating Committee
are Messrs. Oaks, Holbrook and VanDeWeghe, with Mr. VanDeWeghe serving as the chair. Each of Messrs. Oaks, Holbrook and VanDeWeghe meets
the independence and other requirements to serve on our Governance and Nominating Committee under The Nasdaq Stock Market Rules and the
rules of the SEC.

 The
Governance and Nominating Committee was formed in 2021. Our Board of Directors has adopted a written charter for the Governance and Nominating
Committee, a copy of which is posted in the Investor Resources and Corporate Governance section of our website at www.ciso.inc/investor-relations/charter-of-the-nominating-and-corporate-governance-committee.
The Governance and Nominating Committee considers the performance of the members of our Board of Directors and nominees for director
positions and evaluates and oversees corporate governance and related issues.

 The
goal of the Governance and Nominating Committee is to ensure that our directors possess a variety of perspectives and skills derived
from high-quality business and professional experience. The Governance and Nominating Committee seeks to achieve a balance of knowledge,
experience, and capability on our Board of Directors. To this end, the Governance and Nominating Committee seeks nominees with the highest
professional and personal ethics and values, an understanding of our business and industry, diversity of business experience and expertise,
a high level of education, broad-based business acumen, and the ability to think strategically. Although the Governance and Nominating
Committee uses these and other criteria to evaluate potential nominees to our Board of Directors, it has no stated minimum criteria for
such nominees. The Governance and Nominating Committee does not use different standards to evaluate nominees depending on whether they
are proposed by our directors and management or by our stockholders. To date, we have not paid any third parties to assist us in this
process.

 Code
of Ethics

 We
have adopted a Code of Ethics and Business Conduct ("Code of Ethics") that sets forth various policies and procedures to
promote ethical behavior and that applies to all our directors, officers and employees. The Code of Ethics is publicly available on our
website at www.ciso.inc. Amendments to the Code of Ethics and any grant of a waiver from a provision of the Code of Ethics requiring
disclosure under applicable SEC rules will be disclosed on our website.

 Delinquent Section 16(a)
Reports

 Section
16(a) of the Exchange Act, requires officers and directors of our company and persons who beneficially own more than 10% of a registered
class of our company's equity securities to file initial statements of beneficial ownership of common stock (Form 3) and statements
of changes in beneficial ownership of common stock (Forms 4 or 5) with the SEC. Officers, directors, and greater than 10% stockholders
are required by SEC regulations to furnish us with copies of all such forms they file.

 Based
solely on our review of such reports and certain representations from each reporting person, we believe that during 2023, all Section
16(a) filing requirements were satisfied on a timely basis.

 - 40 -

 ITEM
11. EXECUTIVE COMPENSATION

 The
following table shows the total compensation paid or accrued during the years ended December 31, 2023 and 2022 to our Chief
Executive Officer, and our next two most highly compensated executive officers who were serving as executive officers on December
31, 2023, (collectively, our "named executive officers").

 Name and Principal Position

 Year

 Salary
 ($)

 Bonus
 ($)

 Stock Awards
 ($)

 Option Awards
 ($) (1)

 Non-Equity Incentive Plan Compensation
 ($)

 Non-qualified Deferred Compensation Earnings
 ($)

 All Other Compensation
 ($) (2)

 Total

 ($)

 2023

 315,105

 62,500

 -

 -

 -

 -

 14,118

 391,723

 Chief Executive Officer

 2022

 250,000

 116,651

 -

 -

 -

 -

 366,876

 Debra L. Smith

 2023

 280,642

 53,125

 -

 -

 -

 -

 7,576

 341,343

 Chief Financial Officer

 2022

 200,000

 60,500

 -

 892,200

 -

 -

 1,152,925

 Kyle J. Young

 2023

 274,392

 48,000

 -

 -

 -

 -

 12,168

 334,560

 Interim Chief Operating Officer (3)

 2022

 -

 -

 -

 -

 -

 -

 -

 -

 (1)

 The
 amounts in this column reflect the fair value on the grant date of the option awards granted to the named executive officer, calculated
 in accordance with ASC Topic 718. Stock options were valued using the Black-Scholes model. The grant-date fair value does not necessarily
 reflect the value of shares which may be received in the future with respect to these awards. The grant-date fair value of the stock
 options in this column is a non-cash expense that reflects the fair value of the stock options on the grant date and therefore does
 not affect our cash balance. The fair value of the stock options will likely vary from the actual value the holder receives because
 the actual value depends on the number of options exercised and the market price of our common stock on the date of exercise. For
 a discussion of the assumptions made in the valuation of the stock options, see Note 10 to our consolidated financial statements
 included in our Annual Report on Form 10-K for the year ended December 31, 2023.

 (2)

 The
 amounts in the "All Other Compensation" column consist of certain benefits provided to our NEOs, which are generally
 available to our similarly situated employees, including 401(k) company matching and technology stipend. For Mr. Jemmett, the amounts in this column consist of 401(k) company matching
contributions ($13,218) and a technology stipend ($900). For Mr. Young, the amounts in this column consist of 401(k) company matching
contributions of ($11,268) and a technology stipend ($900).

 (3)

 Mr.
 Young was appointed to serve as our Interim Chief Operating Officer on March 31, 2023.

 - 41 -

 Outstanding
Equity Awards as of December 31, 2023

 The
following table summarizes the outstanding equity awards held by each named executive officer as of December 31, 2023.

 Name

 Grant Date

 Number of Shares Underlying Unexercised Options (#) Exercisable

 Number of Shares Underlying Unexercised Options (#) Unexercisable

 Option Exercise Price ($)

 Option
 Expiration Date

 -

 -

 -

 -

 -

 Debra L. Smith

 February 1, 2021
 (1)

 33,332

 -

 30.00

 February 1, 2026

31, 2021
 (2)

 75.00

 December 31, 2031

 January
14, 2022
 (1)(3)

 21,863

 11,470

 45.30

 January 14, 2032

 Kyle J. Young

 February 1, 2021
 (1)

 33,332

 -

 30.00

 February 1, 2026

 December 31, 2021
 (2)

 75.00

 December 31, 2031

 January 14, 2022
 (1)(3)

 21,863

 11,470

 45.30

 January 14, 2032

 (1)

 30%
 of the shares underlying this option vested on the one-year anniversary of the grant date with the remainder vesting month over the subsequent 24-month period.

 (2)

 25%
 of the shares underlying this option vested on the one-year anniversary of the grant date with the remainder vesting monthly over
 the subsequent 36-month period.

 (3)

 On
 August 22, 2022, we repriced these option grants to reflect an exercise price equal to the fair value of our common stock. Vesting
 provisions of these option grant remained on the same terms as the original option grant.

 Retirement
Plans

 We
maintain a tax-qualified Section 401(k) retirement savings plan for our executive officerss and other employees who satisfy the
eligibility requirements. Under this plan, participants may elect to make pre-tax or Roth contributions of up to a certain portion
of their current compensation, not to exceed the applicable statutory income tax limitation. We provided matching contributions made
by participants in the plan up to a maximum of 3.5% of eligible compensation annually, subject to limitations in our 401(k) plan
applicable to highly compensated employees. We intend for the plan to qualify under Section 401(a) of the U.S. Internal Revenue Code
of 1986, as amended (the "Code"), enabling contributions by participants to the plan, and income earned on plan
contributions, to not be taxable to participants until withdrawn from the plan.

 Employment
Agreements with our Named Executive Officers

 David
G. Jemmett

 On
September 30, 2019, we entered into an employment agreement with Mr. Jemmett to serve as our Chief Executive Officer (the "Jemmett
Employment Agreement"). The Jemmett Employment Agreement is evergreen and can be terminated by either party. Pursuant to the Jemmett
Employment Agreement, the Board of Directors approved an increase to Mr. Jemmett's annual base salary from $250,000 to $375,000
and may be increased hereafter from time to time at the discretion of the Board of Directors. Mr. Jemmett's base salary may be
increased in accordance with our normal compensation and performance review policies. He is entitled to receive a discretionary annual
bonus of up to 100% of his annual base salary, at the discretion of our Board of Directors, based on performance and our objectives.
Subject to approval by our Board of Directors, Mr. Jemmett is entitled to stock options under our 2019 Equity Incentive Plan. The stock
options will vest at 33% on the one-year anniversary of the Jemmett Employment Agreement and the remaining 66% of the options will vest
monthly over the next 12 months. As of December 31, 2022, our Board of Directors had not approved or granted any stock options to Mr.
Jemmett. On December 31, 2022, a bonus of $62,500 was accrued for Mr. Jemmett and subsequently paid in equal installments on April 28,
May 31, and June 30, 2023. Mr. Jemmett is also eligible to participate in our standard benefit plans.

 - 42 -

 Debra
L. Smith

 On
December 31, 2020, we entered into an employment agreement with Ms. Smith to serve as our Executive Vice President of Finance, effective
as of February 1, 2021 (the "Smith Employment Agreement"). Pursuant to the Smith Employment Agreement, the Board of Directors
approved an increase to Ms. Smith's annual base salary from $200,000 to $350,000 and may be increased hereafter from time to time
at the discretion of the Board of Directors. Ms. Smith also earns a guaranteed bonus of $60,000 to be paid quarterly, and an additional
$60,000 at the end of each fiscal year at the discretion of our Board of Directors. A bonus of $53,125 was accrued for Ms. Smith and
subsequently paid in installments on March 31, April 28, May 31, and June 30, 2023. Ms. Smith is also eligible to participate in our
standard benefit plans. On June 18, 2021, we appointed Ms. Smith to serve as Chief Financial Officer. The terms of the original Smith
Employment Agreement remained in force.

 Kyle
J. Young

 On
March 31, 2023, we entered into an employment agreement with Mr. Young to serve as our Chief Operating Officer (the "Young Employment
Agreement"). The Young Employment Agreement is evergreen and can be terminated by either party. Pursuant to the Young Employment
Agreement, the Board of Directors approved an increase to Mr. Young's annual base salary from $200,000 to $350,000, and an annual
bonus between 20% and 100% of base annual salary at the discretion of our Board of Directors. A bonus of $47,500 was accrued for Mr.
Young and subsequently paid in installments on April 28, May 31, and June 30, 2023. Mr. Young is also eligible to participate
in our standard benefit plans.

Compensation

 The
following table sets forth for each non-employee director certain information concerning their compensation for the year ended December
31, 2023:

 Name (1)

 Fees Earned or
 Paid in Cash
 ($)

 Stock Awards ($)

 Option Awards ($) (2)

 Non-equity Incentive Plan Compensation ($)

 Nonqualified Deferred Compensation Earnings
 ($)

 All Other Compensation ($)

 Total
 ($)

 Reid S. Holbrook

 -

 -

 -

 -

 -

 -

 -

 Andrew K. McCain

 -

 -

 -

 -

 -

 -

 -

 Ret. General Robert C. Oaks

 -

 -

 -

 -

 -

 -

 -

 Stephen Scott (3)

 -

 -

 -

 -

 -

 $
 159,000

 $
 159,000

 Ernest M. (Kiki) VanDeWeghe, III

 -

 -

 -

 -

 -

 -

 -

 Notes:

 (1)

 All
 directors receive reimbursement for reasonable out-of-pocket expenses in attending Board meetings and for participating in our business.

 (2)

 The
 amounts in this column reflect the fair value on the grant date of the option awards granted to the named executive, calculated in
 accordance with ASC Topic 718. Stock options were valued using the Black-Scholes model. The grant-date fair value does not necessarily
 reflect the value of shares which may be received in the future with respect to these awards. The grant-date fair value of the stock
 options in this column is a non-cash expense that reflects the fair value of the stock options on the grant date and therefore does
 not affect our cash balance. The fair value of the stock options will likely vary from the actual value the holder receives because
 the actual value depends on the number of options exercised and the market price of our common stock on the date of exercise. For
 a discussion of the assumptions made in the valuation of the stock options, see Note 10 to our consolidated financial statements,
 which are included in our Annual Report on Form 10-K for the year ended December 31, 2022.

 (3)

 Mr.
 Scott received payment of $11,500 per month under the terms of an independent consulting agreement to provide services relating to
 our strategic and business development, and sales and marketing. In July 2023, we entered into a new independent consulting
 agreement with Mr. Scott to provide similar services for payment for $15,000 per month. Mr. Scott resigned as a Director
 on May 10, 2023.

 - 43 -

 ITEM
12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

 The
following table sets forth certain information with respect to the beneficial ownership of our common stock as of April 5, 2024 for (a)
the named executive officers, (b) each of our directors, (c) all of our current directors and executive officers as a group and (d) each
stockholder known by us to own beneficially more than 5% of our common stock. Beneficial ownership is determined in accordance with the
rules of the SEC and includes voting or investment power with respect to the securities. We deem shares of common stock that may be acquired
by an individual or group within 60 days of April 5, 2024 pursuant to the exercise of options or warrants to be outstanding for the purpose
of computing the percentage ownership of such individual or group but are not deemed to be outstanding for the purpose of computing the
percentage ownership of any other person shown in the table. Except as indicated in footnotes to this table, we believe that the stockholders
named in this table have sole voting and investment power with respect to all shares of common stock shown to be beneficially owned by
them based on information provided to us by these stockholders. Percentage of ownership is based on 12,232,379 shares of common stock
outstanding on April 5, 2024.

Ownership of Certain Beneficial Holders

 Name and Address of
 Beneficial Owner (1)

 Amount and Nature of
 Beneficial
 Ownership

 Percent

 Jemmett Enterprises, LLC

 4,429,000
 (2)

 36.21
 %

 Stephen H. Scott, Jr.

 1,203,335
 (3)

 9.84
 %

Ownership of Directors and Executive Officers

 Name and Address of
 Beneficial Owner (1)

 Amount and Nature of
 Beneficial
 Ownership

 Percent

 4,629,001
 (4)

 37.84
 %

 Debra L. Smith

 59,090
 (5)

 *

 Kyle J. Young

 59,090
 (6)

 *

 Ret. General Robert C. Oaks

 26,666
 (7)

 *

 Reid S. Holbrook

 26,666
 (7)

 *

 Andrew K. McCain

 529,444
 (8)

 4.22
 %

 Kiki VanDeWeghe

 13,333
 (9)

 *

 Brett Chugg

 —

 —

 Directors
& Executive Officers as a Group (8 persons)

 5,343,290
 (10)

 42.00
 %

 Notes:

 *

 Less
 than 1% of the outstanding shares of common stock.

 (1)

 Unless
 otherwise indicated, the address of record is c/o CISO Global, Inc., 6900 E. Camelback Road, Suite 900, Scottsdale, Arizona 85251.

 (2)

 Mr.
 Jemmett is the managing member of Jemmett Enterprises, LLC and has voting and dispositive power over such shares.

 (3)

 of (i) 853,334 shares held directly by Mr. Scott; (ii) 333,334 shares beneficially held by TVMT LLC; and (iii) 16,667 shares beneficially
 held by JLS 401k Trust.

 (4)

 of (i) 4,429,000 shares held by Jemmett Enterprises, LLC, of which Mr. Jemmett is the managing member and has voting and dispositive
 power over such shares; (ii) 133,334 shares held by Xander LLC, of which Mr. Jemmett and his wife are the sole members and have voting
 and dispositive power over such shares; and (iii) 66,667 shares held by Dana Borgman Trust.

 (5)

 of 59,090 shares issuable upon exercise of options exercisable within 60 days after April 5, 2024.

 (6)

 of 59,090 shares issuable upon exercise of options exercisable within 60 days after April 5, 2024.

 (7)

 of 26,666 shares issuable upon the exercise of options exercisable within 60 days after April 5, 2024.

 (8)

 of (i) 25,000 shares held indirectly as executor of the Andrew and Lucy McCain Family Trust, for which Mr. McCain has voting and
 dispositive power; (ii) 200,000 shares held by Hensley & Company, for which Mr. McCain has voting and dispositive power; (iii)
 26,666 shares issuable upon the exercise of options exercisable within 60 days after April 5, 2024; and (iv) 277,778 shares issuable
 upon the conversion of a note payable held by Hensley & Company.

 (9)

 of 13,333 shares issuable upon the exercise of options exercisable within 60 days after April 5, 2024.

 (10)

 Includes
 211,511 shares issuable upon the exercise of stock options and 277,778 shares issuable upon conversion of a note
 payable.

 - 44 -

 The
following table sets forth information with respect to our common stock that may be issued upon the exercise of stock options under our
equity compensation plans as of December 31, 2023:

 Plan
 Category

 Number
 of Securities to be Issued Upon Exercise of Outstanding Options

 Weighted-Average
 Exercise Price of Outstanding Options

 Number
 of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (a))

 (a)

 (b)

 (c)

 Equity
compensation plans approved by security holders

 2,105,168

 $

 31.63

 4,232,853

 Equity
 compensation plans not approved by security holders

 —

 —

 —

 Total

 2,105,168

 $

 31.63

 4,232,853

 ITEM
13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

 Transactions
with Related Persons

 Except
as set out below, during the year ended December 31, 2023, there were no transactions, or currently proposed transactions, in which we
were or are to be a participant and the amount involved exceeds the lesser of $120,000 or one percent of the average of our total assets
at year-end for the last two completed fiscal years, and in which any of the following persons had or will have a direct or indirect
material interest:

 any
 director or executive officer of our company;

 any
 person who beneficially owns, directly or indirectly, shares carrying more than 5% of the voting rights attached to our outstanding
 shares of common stock;

 any
 promoters and control persons; and

 any
 member of the immediate family (including spouse, parents, children, siblings and in laws) of any of the foregoing persons.

 Independent
Consulting Agreement with Stephen Scott

 In
August 2020, we entered into an Independent Consulting Agreement with Stephen Scott, a then director of our company, with respect to
advisory and consulting services relating to our strategic and business development, and sales and marketing. Mr. Scott received a consulting
fee of $11,500 per month for such services.

 In
July 2023, we entered into an Independent Consulting Agreement with Mr. Scott, to provide, on a non-exclusive basis, advisory and consulting
services relating to our strategic and business development, intellectual property development, banking relationships, and strategic
M&A for a period of one year. Mr. Scott will receive a consulting fee of $15,000 per month for such services under the terms of this
agreement. During the years ended December 31, 2023 and 2022, we paid consulting fees to Mr. Scott in the amounts of $159,000 and $138,000,

Services Agreement with Hensley Beverage Company

 In
July 2021, we entered into a 1-year Managed Services Agreement with Hensley Beverage Company, an entity affiliated with Mr. McCain, a
director of our company, to provide secured managed services. We also may be engaged by Hensley Beverage Company from time to time to
provide other related services outside the scope of the Managed Services Agreement. While the agreement provides for a term through December
31, 2021, the agreement will continue until terminated by either party. For the years ended December 31, 2023 and 2022, we received $1,417,398
and $850,445, respectively from Hensley Beverage Company for contracted services and had an outstanding receivable balance of $152,213
and $15,737 as of December 31, 2023 and 2022, respectively.

 Convertible
Note Payable with Hensley Beverage Company

 In
March 2023, we issued an unsecured convertible note to Hensley & Company in the principal amount of $5,000,000 bearing an interest
rate of 10.00% per annum. The principal amount, together with accrued and unpaid interest is due on March 20, 2025. At any time prior
to or on the maturity date, Hensley & Company is permitted to convert all or any portion of the outstanding principal amount and
all accrued and unpaid interest thereon into shares of our common stock at a conversion price of $18.00 per share ($1.20 on a pre-reverse
split basis). During the year ended December 31, 2023, we recorded interest expense of $388,888 and as of December 31, 2023, we had accrued
interest of $388,888. Andy McCain, a director of our company, is President and Chief Executive officer of Hensley & Company.

Independence

 See
"Directors, Executive Officers and Corporate Governance – Director Independence" and "Directors, Executive Officers
and Corporate Governance – Board Committees" in Item 10 above.

 - 45 -

 ITEM
14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

 Our
Audit Committee has appointed Semple, Marchal & Cooper, LLP ("SMC") to audit the consolidated financial statements of
our company for the fiscal year ending December 31, 2023. The following table sets forth the fees billed to our company for professional
services rendered by SMC for the years ended December 31, 2023 and 2022:

 Services

 2023

 2022

 Audit
 fees (1)

 $

 498,395

 $

 369,481

 Audit-related
 fees (2)

 51,863

 104,663

 Tax
 fees (3)

 65,827

 50,213

 All
 other fees

 17,235

 -

 Total
 fees

 $

 633,320

 $

 524,357

 (1)

 Audit
 fees consisted of billing for professional services normally provided in connection with statutory and regulatory filings, including
 (i) fees associated with the audits of our financial statements for the years ended December 31, 2023 and 2022 and, (ii) fees associated
 with quarterly reviews for the quarters ended March 31, 2023 and 2022, June 30, 2023 and 2022, and September 30, 2023 and 2022.

 (2)

 Audit
 related fees consisted of billings for professional services for reviews of our periodic filings under form 10-K and 10-Q and acquisition
 audits for the years ended December 31, 2023 and 2022.

 (3)

 Tax
 fees consisted primarily of tax related advisory and preparation services.

 Audit
Committee Pre-Approval Policies

 The
charter of our Audit Committee provides that the authority and responsibilities of our Audit Committee include the pre-approval of all
audit and permitted non-audit and tax services that may be provided by our independent auditors or other registered public accounting
firms, and the establishment of policies and procedures for the Audit Committee's pre-approval of permitted services by our independent
auditors or other registered public accounting firms on an on-going basis.

 For
audit services, each year our independent auditor provides our Audit Committee with an engagement letter outlining the scope of the audit
services proposed to be performed during the year, which must be formally accepted by our Audit Committee before the audit commences
prior to engagement of an independent auditor for next year's audit, management will submit an aggregate of services expected to
be rendered during that year for each of three categories of services to our Audit Committee for approval.

 All
of the services provided by SMC described above under the caption "Audit-Related Fees" were approved by our Audit Committee
pursuant to our Audit Committee's pre-approval policies.

 - 46 -

 PART
IV

 ITEM
15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

 (a)

 The
 following documents are filed as a part of the report:

 (1)

 For
 a list of the financial statements included herein, see the index to the financial statements beginning on page F-1 of this Annual
 Report on Form 10-K, incorporated into this Item by reference.

 (2)

 Financial
 statement schedules have been omitted because they are either not required or not applicable or the information is included in the
 consolidated financial statements or the notes thereto.

 (b)

 Exhibits.

 Exhibit

 Incorporated
 by Reference

 Number

 Exhibit
 Description

 Form

 Exhibit

 Filing
 Date

 2.1

 Agreement for the Purchase and Sale of Limited Liability Company Interests of GenResults, LLC dated April 12, 2019

 10-12G

 10.1

 10/2/2019

 2.2**

 Agreement and Plan of Merger by and among the Registrant, TalaTek, LLC, TalaTek Merger Sub and Baan Alsinawi dated September 23, 2019

 10-12G

 2.2

 10/2/2019

 2.3

 Stock Purchase Agreement by and among the Registrant, Technologyville, Inc. and Brian Yelm dated May 25, 2020

 10.1

 5/29/2020

 2.4

 Share Purchase Agreement among the Registrant, Clear Skies Security, LLC and all of its Members dated July 31, 2020

 10.1

 8/6/2020

 2.5**

 Agreement and Plan of Merger by and among the Registrant, Alpine Merger Sub, LLC, Alpine Security, LLC and Christian Espinosa dated December 16, 2020

 10.1

 12/21/2020

 2.6**

 Amended and Restated Agreement and Plan of Merger by and among the Registrant, Catapult Acquisition Merger Sub, LLC, Catapult Acquisition Corporation, the shareholders of Catapult Acquisition Corporation and Darek Hahn dated July 26, 2021

 10.1

 08/02/2021

 2.7**

 Stock Purchase Agreement by and among the Registrant, Atlantic Technology Systems, Inc., Atlantic Technology Enterprises, Inc., and James Montagne and Miriam Montagne as sole shareholders, dated October 1, 2021

 10.1

 10/07/2021

 2.8**

 Agreement and Plan of Merger by and among the Registrant, RED74 Merger Sub, LLC, RED74 LLC, Ticato Holdings, Inc. and Tim Coleman dated October 8, 2021

 10.1

 11/15/2021

 2.9**

 Stock Purchase Agreement by and among the Registrant, Southford Equities, Inc., a British Virgin Islands based company and David Esteban Alfaro Medina, Roberto Andr s Arriagada Poblete and Camilo Orlando Garrido Briones dated December 1, 2021

 10.1

 12/06/2021

 2.10

 Stock Purchase Agreement among the Registrant and certain shareholders of True Digital Security Inc. dated January 5, 2022

 10.1

 01/06/2022

 2.11**

 Agreement and Plan of Merger among the Registrant and certain shareholders of True Digital Security Inc. dated January 5, 2022

 10.2

 01/06/2022

 3.1

 Second Amended and Restated Certificate of Incorporation of the Registrant

 3.1

 08/15/2022

 3.1(a)

 Certificate of Amendment of Amended and Restated Certificate of Incorporation of the Registrant

 3.1

 04/10/2023

 3.1(b)

 C ertificate of Amendment of Amended and Restated Certificate of Incorporation of the Registrant

 3.1

 03/07/2024

 3.2

 Second Amended and Restated By-laws of the Registrant

 3.1

 10/10/2023

 4.1

 Form of Common Stock Certificate of the Registrant

 4.1

 03/30/2020

 4.2

 Description of Securities Registered under Section 12 of the Exchange Act

 4.2

 4.3

 Form of Underwriter Warrant

 S-1

 4.3

 12/14/2021

 4.4

 Form of Placement Agent Warrant

 4.1

 05/17/2023

 10.1

 Stock Repurchase Agreement between the Registrant and Alan Kierman dated September 1, 2019

 10.4

 03/30/2020

 10.2#

 2019 Equity Incentive Plan, as amended

 10.3

 08/15/2022

 10.3(a)#

 Form of Stock Option Agreement

 10.3

 04/15/2022

 10.4#

 Employment Agreement between the Registrant and David G. Jemmett dated September 30, 2019

 10-12G

 10.2

 010/2/2019

 10.5

 Purchase Agreement and 5% Unsecured Convertible Note by the Registrant payable to Neil Stinchcombe dated October 27, 2021

 10.1

 11/02/2021

 10.5(a)

 Letter Agreement between the Registrant and Neil Stinchcombe dated March 27, 2023

 10.5(a)

 10.6#

 Employment Agreement by and between Debra L. Smith and the Registrant dated December 31, 2020

 10.10

 04/15/2022

 10.7#

 Employment Agreement by and between David A. Bennett and the Registrant dated February 12, 2022

 10.7

 10.8#

 Employment Agreement by and between Ashley N. Devoto and the Registrant dated December 23, 2021

 10.8

 10.9

 Form of Lockup Agreement

 S-1/A

 10.14

 01/07/2022

 10.10

 Purchase Agreement, dated March 20, 2023, by and between the Registrant and Hensley & Company dba Hensley Beverage Company

 10.1

 03/20/2023

 10.11

 10% Unsecured Convertible Note by the Registrant payable to Hensley & Company, dated March 20, 2023

 10.2

 03/20/2023

 10.12#

 Employment Agreement by and between Kyle J. Young and the Registrant dated March 30, 2023

 10.12

 10.13#

 2023 Equity Incentive Plan

 S-8

 10.2

 10/31/2023

 10.14

 Placement Agency Agreement, dated May 16, 2023, by and between the Registrant and each Purchaser thereto

 10.2

 05/17/2023

 10.15

 Form of Securities Purchase Agreement, dated May 16, 2023, by and between the Registrant and each Purchasers thereto

 10.1

 05/17/2023

 21.1*

 Subsidiaries of the Registrant

 23.1*

 Consent of Semple, Marchal & Cooper LLP

 23.2*

 Consent of Baker Tilly Chile Ltda.

 31.1

 Rule 13a-14(a) / 15d-14(a) Certification of Principal Executive Officer

 31.2

 Rule 13a-14(a) / 15d-14(a) Certification of Principal Financial Officer

 32.1

 Section 1350 Certification of Principal Executive Officer

 32.2

 Section 1350 Certification of Principal Financial Officer

 97.1*

 CISO Global, Inc. Executive Officer Incentive Compensation Recovery Policy

 101.INS

 101.SCH

 101.CAL

 101.DEF

 101.LAB

 101.PRE

 Cover

 *Filed
herewith.

 **Certain
exhibits, annexes, and/or schedules have been omitted from this filing pursuant to Item 601(b)(2) of Regulation S-K. We agree to furnish
supplementally a copy of any omitted exhibit, annex, or schedule to the Securities and Exchange Commission upon request.

 #
Management contracts and compensatory plans and arrangements.

 ITEM
16. FORM 10-K SUMMARY

 Not
applicable.

 - 47 -

 SIGNATURES

 Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.

 CISO
 GLOBAL, INC.

 By:

 /s/

 Name:

 David
 G. Jemmett

 Chief
 Executive Officer (Principal Executive Officer)

 Date:

 April

 Pursuant
to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.

 By:

 /s/

 Name:

 David
 G. Jemmett

 Chief
 Executive Officer and Director (Principal Executive Officer)

 Date:

 April

 By:

 /s/
 Debra L. Smith

 Name:

 Debra
 L. Smith

 Chief
 Financial Officer (Principal Financial Officer and Principal Accounting Officer)

 Date:

 April

 By:

 /s/
 Robert C. Oaks

 Name:

 Ret.
 General Robert C. Oaks

 Date:

 April

 By:

 /s/
 Reid S. Holbrook

 Name:

 Reid S. Holbrook

 Date:

 April

 By:

 /s/
 Andrew K. McCain

 Name:

 Andrew
 K. McCain

 Date:

 April

 By:

 /s/
 Ernest M. (Kiki) VanDeWeghe, III

 Name:

 Ernest
 M. (Kiki) VanDeWeghe, III

 Date:

 April

 By:

 /s/
 Brett Chugg

 Name:

 Brett
 Chugg

 Date:

 April

 - 48 -

 CISO
GLOBAL, INC.

FINANCIAL STATEMENTS AS OF DECEMBER 31, 2023 AND 2022

 TABLE
OF CONTENTS

 Page

 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM (PCAOB ID # 178)

 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM (PCAOB
ID # 3172)

 FINANCIAL STATEMENTS:

 Consolidated Balance Sheets as of December 31, 2023 and 2022

 Consolidated
 Statements of Operations and Comprehensive Loss For the Years Ended December 31, 2023 and 2022

 Consolidated
 Statements of Changes in Stockholders' Equity For the Years Ended December 31, 2023 and 2022

 Consolidated Statements of Cash Flows For the Years Ended December 31, 2023 and 2022

 Notes to Consolidated Financial Statements For the Years Ended December 31, 2023 and 2022

 F- 1

 Report
of Independent Registered Public Accounting Firm

 Board
of Directors and Stockholders of

 CISO
Global, Inc. and Subsidiaries

 Scottsdale,
Arizona

 Opinion
on the Consolidated Financial Statements

 We
have audited the accompanying consolidated balance sheets of CISO Global, Inc. (the "Company") as of December 31, 2023 and
2022, the related consolidated statements of operations, stockholders' equity, and cash flows for the years then ended, and the
related notes (collectively referred to as the "consolidated financial statements"). In our opinion, based on our audits
and the report of the other auditors, the consolidated financial statements present fairly, in all material respects, the consolidated
financial position of the Company at December 31, 2023 and 2022, and the results of its consolidated operations and its cash flows for
the years then ended, in conformity with accounting principles generally accepted in the United States of America.

 We
did not audit the combined financial statements of the Company's wholly-owned "South American Subsidiaries," which
include the consolidated balance sheets of Arkavia Networks SpA. and its wholly-owned subsidiaries Arkavia Networks Limitada and Arkavia
Networks, as of December 31, 2023 and 2022, and the related consolidated statements of operations, stockholder's equity, and cash
flows for the years ended December 31, 2023 and 2022; the combined balance sheets of Servicios Informaticos CUATROi, S.P.A., Comercializadora
CUATROi S.P.A., CUATROi Peru S.A.C., and CUATROi S.A.S. (entities under common ownership and management) as of December 31, 2023 and
2022 and the related combined statements of operations, stockholder's equity, and cash flows for the year ended December 31, 2023
and the period from August 26, 2022 (Acquisition) to December 31, 2022; and the combined balance sheets of NLT Networks, S.P.A., NLT
Tecnologias, Limitada, NLT Servicios Profesionales, S.P.A. and White and Blue Solutions, LLC (entities under common ownership and management)
as of December 31, 2023 and 2022 and the related combined statements of operations, stockholders' equity, and cash flows for the
year ended December 31, 2023 and the period from September 1, 2022 (Acquisition) to December 31, 2022; and the related notes (collectively
"combined financial statements"). The combined financial statements of the South American Subsidiaries reflect total assets
of $21.9 million and $39.5 million at December 31, 2023 and 2022, respectively, and total revenues of $23.1 and $10.0 million for the
periods then ended. Those statements were audited by another auditor whose report has been furnished to us, and our opinion, insofar
as it relates to the amounts included for the South American Subsidiaries, is based solely on the report of the other auditors.

 Going
Concern Uncertainty

 The
accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed
in Note 2 to the consolidated financial statements, the Company has suffered recurring losses from operations, negative cash flows from
operations and has a net capital deficiency that raise substantial doubt about its ability to continue as a going concern. Management's
plans in regard to these matters are also described in Note 2. The consolidated financial statements do not include any adjustments that
might result from the outcome of this uncertainty.

 Basis
for Opinion

 These
consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion
on the Company's consolidated financial statements based on our audits. We are a public accounting firm registered with the Public
Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company
in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission
and the PCAOB.

 We
conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud.
The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part
of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing
an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.

 Our
audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether
due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence
regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles
used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.
We believe that our audits provide a reasonable basis for our opinion.

 /s/
 Semple, Marchal & Cooper, LLP

 Certified
Public Accountants

 We
have served as the Company's auditor since 2019.

 Phoenix,
Arizona

 April

 F- 2

 F- 3

 F- 4

 CISO

BALANCE SHEETS

 ASSETS

 Current Assets:

 Cash and cash equivalents

 $
 1,062,442

 $
 1,833,163

 Accounts receivable, net

 5,685,727

 7,862,297

 Inventory

 218,890

 11,803

 Prepaid cost of revenue

 2,592,828

 2,634,667

 1,200,271

 1,724,650

 Contract assets

 197,656

 332,215

 Total Current Assets

 10,957,814

 14,398,795

 Property and equipment, net

 3,677,474

 4,680,495

 Right of use asset, net

 762,228

 255,687

 Intangible assets, net

 3,778,244

 8,475,229

 31,519,844

 76,664,017

 Prepaid cost of revenue, net of current portion

 888,255

 -

 Other assets

 71,523

 22,592

 Total Assets

 $
 51,655,382

 $
 104,496,815

 LIABILITIES AND STOCKHOLDERS' EQUITY

 Current Liabilities:

 $
 15,951,327

 $
 8,310,337

 Deferred revenue

 4,158,969

 4,472,140

 Lease liability

 219,342

 121,731

 3,691,464

 7,758,831

 Convertible notes payable

 2,050,000

 2,550,000

 Total Current Liabilities

 26,071,102

 23,213,039

 Long-term Liabilities:

 Deferred revenue, net of current portion

 -

 Loans payable, net of current portion

 2,748,788

 4,243,802

 Convertible notes payable, related party

 5,000,000

 -

 Lease liability, net of current portion

 596,307

 159,205

 Deferred tax liability

 -

 435,678

 Total Liabilities

 35,515,931

 28,051,724

 Commitments and Contingencies

 -

 -

 Stockholders' Equity:

 Common stock, $.00001
 par value; 300,000,000
 shares authorized; 11,949,959
 and 9,697,921
 issued outstanding at December 31, 2023 and December 31, 2022, respectively

 Preferred stock, $.00001 par value; 50,000,000 shares authorized; 0 shares issued and outstanding on December 31, 2023 and December 31, 2022, respectively

 -

 -

 Additional paid-in capital

 172,837,842

 153,170,351

 Accumulated translation adjustment

 1,320,177

 Accumulated deficit

 ( 158,018,687
)

 ( 77,787,604
)

 Total Stockholders' Equity

 16,139,451

 76,445,091

 Total Liabilities and Stockholders' Equity

 $
 51,655,382

 $
 104,496,815

 The
accompanying footnotes are an integral part of these consolidated financial statements.

 F- 5

 CISO

STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

 Year Ended

 Revenue:

 $
 50,078,925

 $
 40,920,420

 6,979,832

 5,629,197

 Total revenue

 57,058,757

 46,549,617

 Cost of revenue:

 23,671,605

 15,431,523

 900,582

 844,287

 Cost of payroll

 21,613,207

 20,036,182

 Stock based compensation

 4,823,829

 7,512,304

 Total cost of revenue

 51,009,223

 43,824,296

 Total gross profit

 6,049,534

 2,725,321

 Operating expenses:

 Professional fees

 3,695,187

 2,067,603

 Advertising and marketing

 474,121

 804,218

 Selling, general and administrative

 26,744,543

 23,106,451

 Stock based compensation

 7,712,671

 9,885,191

 Impairment of goodwill

 45,194,717

 -

 Total operating expenses

 83,821,239

 35,863,463

 Loss from operations

 ( 77,771,705
)

 ( 33,138,142
)

 Other income (expense):

 Other income (expense)

 ( 13,640
)

 43,332

 Interest expense, net

 ( 2,881,416
)

 ( 680,921
)

 Total other income (expense)

 ( 2,895,056
)

 ( 637,589
)

 Loss before income taxes

 ( 80,666,761
)

 ( 33,775,731
)

 Benefit from income taxes

)

 ( 549
)

 Net loss

 ( 80,231,083
)

 ( 33,775,182
)

 Foreign currency translation adjustment

 Comprehensive loss

 $
 ( 79,973,153
)

 $
 ( 32,712,935
)

 Net loss per common share - basic and diluted (Note 3)

 $
 ( 7.22
)

 $
 ( 3.64
)

 Weighted average shares outstanding - basic

 11,117,316

 9,275,554

 Weighted average shares outstanding - diluted

 11,117,316

 9,275,554

 The
accompanying footnotes are an integral part of these consolidated financial statements.

 F- 6

 CISO

STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (NOTE 3)

 Amount

 Amount

 Capital

 Gain/(Loss)

 Deficit

 Total

 Accumulated

 Additional

 Other

 Common Stock

 Preferred Stock

 Paid-in

 Comprehensive

 Accumulated

 Amount

 Amount

 Capital

 Gain/(Loss)

 Deficit

 Total

 Balance at January 1, 2023

 9,697,921

 $

 -

 $
 -

 $
 153,170,351

 $

 $
 ( 77,787,604
)

 $
 76,445,091

 Stock based compensation - stock options

 -

 -

 -

 -

 11,469,667

 -

 -

 11,469,667

 Stock based compensation - common stock

 233,333

 -

 -

 733,498

 -

 -

 733,500

 Stock issued for cash

 1,782,658

 -

 -

 6,655,475

 -

 -

 6,655,493

 Exercise of options

 69,378

 -

 -

 491,852

 -

 -

 491,853

 Stock issued for SB Cyber acquisition

 33,335

 -

 -

 -

 99,000

 -

 -

 99,000

 Stock issued as lending discount

 133,334

 -

 -

 217,999

 218,000

 Foreign currency translation

 -

 -

 -

 -

 -

 -

 Net loss

 -

 -

 -

 -

 -

 -

 ( 80,231,083
)

 ( 80,231,083
)

 Balance at December 31, 2023

 11,949,959

 $

 -

 $
 -

 $
 172,837,842

 $
 1,320,177

 $
 ( 158,018,687
)

 $
 16,139,451

 Balance at January 1, 2022

 8,328,397

 $

 -

 $
 -

 $
 69,310,544

 $
 -

 $
 ( 44,012,422
)

 $
 25,298,205

 Balance

 8,328,397

 -

 -

 $
 69,310,544

 $
 -

 $
 ( 44,012,422
)

 $
 25,298,205

 Stock based compensation - stock options

 -

 -

 -

 -

 15,464,587

 -

 -

 15,464,587

 Stock based compensation - common stock

 60,655

 -

 -

 2,266,233

 -

 -

 2,266,234

 Stock issued for cash

 23,499

 -

 -

 -

 1,167,289

 -

 -

 1,167,289

 Exercise of options

 179,268

 -

 -

 1,480,140

 -

 -

 1,480,142

 Stock issued for cash in public offering

 137,334

 -

 -

 9,521,797

 -

 -

 9,521,798

 Stock issued for True Digital acquisition

 548,600

 -

 -

 34,726,374

 -

 -

 34,726,380

 Stock issued for acquisition

 548,600

 -

 -

 34,726,374

 -

 -

 34,726,380

 Stock issued for VelocIT acquisition

 17,112

 -

 -

 -

 -

 -

 -

 -

 Stock issued for Red74 acquisition

 2,267

 -

 -

 -

 -

 -

 -

 -

 Stock issued for Creatrix acquisition

 40,000

 -

 -

 3,629,999

 -

 -

 3,630,000

 Stock issued for CyberViking acquisition

 33,267

 -

 -

 -

 1,836,320

 -

 -

 1,836,320

 Stock issued for CUATROi acquisition

 144,463

 -

 -

 6,847,473

 -

 -

 6,847,474

 Stock issued for NLT Secure acquisition

 183,059

 -

 -

 6,919,595

 -

 -

 6,919,597

 Foreign currency translation

 -

 -

 -

 -

 -

 -

 Net loss

 -

 -

 -

 -

 -

 -

 ( 33,775,182
)

 ( 33,775,182
)

 Balance at December 31, 2022

 9,697,921

 $

 -

 $
 -

 $
 153,170,351

 $

 $
 ( 77,787,604
)

 $
 76,445,091

 Balance

 9,697,921

 $

 -

 $
 -

 $
 153,170,351

 $

 $
 ( 77,787,604
)

 $
 76,445,091

 The
accompanying footnotes are an integral part of these consolidated financial statements.

 F- 7

 CISO

STATEMENTS OF CASH FLOWS

 Cash flows from operating activities:

 Net loss

 $
 ( 80,231,083
)

 $
 ( 33,775,182
)

 Adjustments to reconcile net loss to net cash used in operating activities:

 Stock based compensation - stock options

 11,469,667

 15,464,587

 Stock based compensation - common stock

 733,500

 1,932,908

 Depreciation and amortization

 3,144,047

 3,071,917

 Right of use amortization

 227,241

 247,474

 Other

 200,317

 35,782

 Impairment of intangible assets

 3,116,039

 -

 Impairment of goodwill

 45,194,717

 -

 Changes in operating assets and liabilities:

 Accounts receivable, net

 2,085,883

 ( 979,898
)

 Inventory

 ( 217,664
)

 173,156

 Contract assets

 134,559

 ( 166,908
)

 Prepaids and other current assets

 ( 493,328
)

 ( 2,625,108
)

 8,125,856

 4,237,986

 Lease liability

 ( 199,069
)

 ( 206,870
)

 Settlement liability

 -

 ( 470,000
)

 Deferred revenue

 789,206

 2,379,149

 Net cash used in operating activities

 ( 5,920,112
)

 ( 10,681,007
)

 Cash flows from investing activities:

 Purchases of property and equipment

 ( 213,629
)

 ( 512,247
)

 Cash acquired/(paid) in acquisitions, net

 30,430

 ( 5,536,697
)

 Proceeds from the sale of property and equipment

 23,041

 -

 Net cash used in investing activities

 ( 160,158
)

 ( 6,048,944
)

 Cash flows from financing activities:

 Proceeds from sale of common stock

 6,655,493

 10,689,087

 Proceeds from stock option exercise

 491,853

 1,480,142

 Proceeds from loan payable

 6,852,408

 5,000,000

 Proceeds from convertible notes payable, related party

 5,000,000

 -

 Proceeds from convertible note payable

 2,050,000

 1,000,000

 Proceeds from line of credit

 264,723

 86,585

 Payment on line of credit

 ( 261,591
)

 -

 Payment on loans payable

 ( 12,118,340
)

 ( 369,829
)

 Payment on notes payable, related party

 -

 ( 2,083,076
)

 Payment of convertible note payable

 ( 2,550,000
)

 -

 Payment of debt issuance cost

 ( 191,500
)

 ( 25,000
)

 Net cash provided by financing activities

 6,193,046

 15,777,909

 Effect of exchange rates on cash and cash equivalents

 ( 883,497
)

 60,170

 Net decrease in cash and cash equivalents

 ( 770,721
)

 ( 891,872
)

 Cash and cash equivalents - beginning of the period

 1,833,163

 2,725,035

 Cash and cash equivalents - end of the period

 $
 1,062,442

 $
 1,833,163

 Supplemental cash flow information:

 Cash paid for:

 Interest

 $
 2,376,477

 $
 512,374

 Income taxes

 $
 -

 $
 -

 Supplemental disclosure of non-cash transactions:

 Operating lease assets obtained in exchange for operating lease obligations

 $
 733,782

 $
 476,986

 Common stock issued in True Digital acquisition

 $
 -

 $
 34,726,380

 Common stock issued in Creatrix acquisition

 $
 -

 $
 3,630,000

 Common stock issued in VelocIT acquisition

 $
 -

 $
 -

 Common stock issued in RED 74 acquisition

 $
 -

 $
 -

 Common stock issued in CyberViking acquisition

 $
 -

 $
 1,836,320

 Common stock issued in CUATROi acquisition

 $
 -

 $
 6,847,474

 Common stock issued in NLT Secure acquisition

 $
 -

 $
 6,919,597

 Common stock issued in SB Cyber acquisition

 $
 99,000

 $
 -

 Common stock issued in acquisition

 $
 99,000

 $
 -

 Common stock issued as a lending discount

 $
 218,000

 $
 -

 The
accompanying footnotes are an integral part of these consolidated financial statements.

 F- 8

 CISO

 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS

 NOTE
1 – NATURE OF THE ORGANIZATION AND BUSINESS

 Unless
otherwise indicated or the context requires otherwise, the terms ""we," "us," "our," and "our
company" refer to CISO Global, Inc., a Delaware corporation ("CISO Global"), and our wholly owned subsidiaries. All dollar amounts are expressed in United States dollars.

 Nature
of the Business

 We
are a cybersecurity and compliance company comprised of highly trained and seasoned security professionals who work with clients to enhance
or create a better cyber posture in their organization. We provide a full range of cybersecurity consulting and related services, encompassing
all three pillars of compliance, cybersecurity, and culture. Our services include secured managed services, compliance services, security
operations center ("SOC") services, virtual Chief Information Security Officer ("vCISO") services, incident response,
certified forensics, technical assessments, and cybersecurity training. We believe that culture is the foundation of every successful
cybersecurity and compliance program. To deliver that outcome, we developed our unique offering of MCCP+ ("Managed Compliance &
Cybersecurity Provider + Culture"), which is a holistic solution that provides all three of these pillars under one roof
from a dedicated team of subject matter experts. In contrast to the majority of cybersecurity firms that are focused on a specific technology
or service, we seek to differentiate ourselves by remaining technology agnostic, focusing on accumulating highly sought-after topic experts.
We continually seek to identify and acquire cybersecurity talent to expand our service scope and geographical coverage to provide the
best possible service for our clients. We believe that bringing together a world-class team of technological experts with multi-faceted
expertise in the critical aspects of cybersecurity is key to providing technology agnostic solutions to our clients in a business environment
that has suffered from a chronic lack of highly skilled professionals, thereby setting us apart from competitors and in-house security
teams. Our goal is to create a culture of security and to help quantify, define, and capture a return on investment from information
technology and cybersecurity spending.

 NOTE
2 – LIQUIDITY AND GOING CONCERN CONSIDERATIONS

 The accompanying financial statements
have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal
course of business However, due to losses incurred, substantial doubt about the Company's ability to continue as a going concern
exists.

 We are evaluating strategies to
obtain the required additional funding for future operations. These strategies may include, obtaining equity financing, issuing debt or
entering into other financing arrangements, and restructuring of operations to grow revenues and decrease expenses. However, we may be
unable to access further equity or debt financing when needed. As such, there can be no assurance that we will be able to obtain additional
liquidity when needed or under acceptable terms, if at all.

 The ability for us to continue as a going concern is dependent upon our
ability to successfully accomplish the plan described in the Growth Strategy paragraph and eventually attain profitable operations. The
consolidated financial statements do not include any adjustments to the carrying amounts and classification of assets, liabilities, and
reported expenses that may be necessary if the Company were unable to continue as a going concern.

 F- 9

 NOTE
3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 Basis
of Presentation

 The
accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the
United States of America ("GAAP"). The summary of significant accounting policies presented below is designed to assist in
understanding our consolidated financial statements. Such consolidated financial statements and accompanying notes are the representations
of our management, who is responsible for their integrity and objectivity.

 Reverse
Stock Split

 On
February 29, 2024, our board of directors approved a 1-for-15
reverse stock split of our common stock. The record date for the reverse stock split was the close of business on March 7,
2024, with share distribution occurring on March 8, 2024. As a result of the reverse stock split, stockholders received one
share of CISO Global, Inc. common stock, par value $ 0.00001,
for each 15
shares they held as of the record date. All share and per share amounts have been retroactively restated for the effects of this
reverse stock split. Common stock underlying our outstanding warrants, convertible notes, and options have also been
adjusted, and the conversion and exercise prices have also been adjusted.

 Consolidation

 The
consolidated financial statements include the accounts of our company and our wholly owned subsidiaries. All significant intercompany
accounts and transactions have been eliminated in consolidation.

 Prior
Period Reclassifications

 Reclassification
of certain immaterial prior period amounts have been made to conform to the current period presentation.

 Use
of Estimates

 Preparing
financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts
of revenue and expenses during the reporting period. Actual results could differ from those estimates.

 We
believe the following critical accounting policies affect our more material judgments and estimates used in the preparation of the
accompanying consolidated financial statements. Material estimates include the allowance for credit losses, the carrying value
of intangible assets and goodwill, deferred tax asset and valuation allowance, the estimated fair value of assets acquired, liabilities
assumed and stock issued in business combinations, and assumptions used in the Black-Scholes-Merton pricing model, such as expected volatility,
risk-free interest rate, share price, expected dividend rate, and the adequacy of insurance reserves.

 Our
revenues are derived from two major types of services to clients: security managed services and professional services. With respect to
Security Managed Services, we provide culture education and enablement, tools and technology provisioning, data and privacy monitoring,
regulations and compliance monitoring, remote infrastructure administration, and cybersecurity services including, but not limited to,
antivirus and patch management. With respect to Professional Services, we provide cybersecurity consulting, compliance auditing, vulnerability
assessment and penetration testing, and disaster recovery and data backup solutions.

 Our
managed services offerings typically are paid in advance of providing services. We have determined that our contracts do not include
a significant financing component. Payments received in advance of our performance are initially recorded as deferred revenue and then
recognized as revenue on a straight-line basis over the term of the contract. Revenue is recognized net of allowances for applicable
transaction-based taxes collected from customers.

 Our
revenue is categorized and disaggregated as reflected in our consolidated statements of operations and comprehensive loss, as follows:

Managed Services

 We have three distinct revenue streams under cybersecurity security managed
services: risk and compliance, cyber defense operations, and secured managed services. We derive revenue from risk and compliance by ensuring
our customers implement the right controls, properly prioritizing risks, and investing in the appropriate remediation, so our customers
can achieve compliance, adhere to industry standards and guidelines, and manage continuous monitoring over time. We derive revenue from
cyber defense operations through security focused end-to-end network and device management solutions for companies that want to outsource
their administration needs to a team of senior engineers who provide modern strategy, insights, support, SOC-as-a-service, which is a
subscription-based service that manages and monitors clients' logs, devices, clouds, network, and assets for possible cyber threats.
Secured managed services include road mapping the future state for the client and providing our knowledgeable expertise to help them achieve
their security needs.

 F- 10

 Performance
Obligations

 Our
contract transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance
obligation is satisfied. We have determined the performance obligations for the following services:

 Risk
and Compliance: We have determined that services provided under risk and compliance contains a single performance obligation. We
recognize revenue as earned based on time and material.

 Cyber Defense Operations: We consider these services to be one performance obligation, although they may include various parts (e.g., support
desk, vulnerability identification and patching, firewall management, etc. (referred to generally as the "parts")). These
parts are not viewed as being distinct, but rather a collection of interrelated parts that are combined to fill a functional need over
a period of time (managed IT service). As such, the parts are not viewed as distinct as the parts are not separable in the contract.
We bill the client on a monthly basis under the annual contract, and revenue is recognized as earned ratably over the contract term.

 Secured
Managed Services: We have determined that secure IT and architecture services is viewed by our company as one performance
obligation, although it may include various parts (e.g., strategy, advisory, architecture, design, security and oversight (referred
to generally as the "parts")). This position is based on the fact that these various parts are not viewed as being
distinct. Revenue is recognized as earned based on time and materials.

 Professional
Services

 We have two distinct revenue streams
under professional services: incident response and digital forensics, and security testing and training. We derive revenue from security
testing and training by utilizing the same tools and techniques a malicious cybercriminal would use to try to gain unauthorized access
to highly guarded corporate systems and data to evaluate technical controls and quantify business risks in a meaningful way. We also offer
cybersecurity awareness training required under most compliance frameworks, and recommended as a best practice under National Institute
of Standards and Technology standards, to help reduce the risk of a successful cyber-attack. We derive revenue from the sale of hardware
and software for customer's IT infrastructure along with occasional staffing services.

 We derive
revenue from incident response and digital forensics by providing our customers with certified experts experienced in locating and
neutralizing threat actors who have breached their environments. Our team is able to identify and contain a cyberattack quickly,
implement patches or configuration changes to prevent re-infection, perform forensic analysis to determine root cause, and provide a
plan of attack for improvements that will prevent a similar attack from succeeding in the future.

 Performance
Obligations

 Our
contract transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance
obligation is satisfied. We have determined the performance obligations for the following services:

 Security Testing and Training: We have determined that security testing and training is viewed by our
company as one performance obligation. Revenue is recognized at a point in time when the result of the assessment is turned over to the
customer, as earned based on time and materials, or upon delivery of equipment to the client.

 Incident
Response and Digital Forensics: We consider these services to be one performance obligation, although they may include various
parts (e.g., determine the source, cause, and prevention of recurrence etc. (referred to generally as the "parts")).
These parts are not viewed as being distinct. We recognize revenue as earned based on time and material.

 F- 11

 Cash
and Cash Equivalents

 We
consider all highly liquid investments with original maturities of three months or less at the time of purchase to be cash equivalents.

 Accounts
Receivable

 Accounts
receivable are generally unsecured, non-interest bearing and reported at their outstanding unpaid principal balances, net of allowances for credit losses.
We provide for allowances for credit losses based on our estimate of uncollectible amounts considering age, collection history,
and any other factors considered appropriate. Payments are generally due within 30 days of invoice. We write off accounts receivable
against the allowance for credit losses when a balance is determined to be uncollectible. As of December 31, 2023 and 2022, our allowance
for credit losses was $ 219,141 and $ 270,011, respectively.

 Prepaid
cost of revenue

 Prepaid
cost of revenue represents amounts charged by our vendors for licenses that we resell to our customers. These amounts are amortized to
cost of revenue over the same period revenue is recognized for the related contract with our customers.

and Equipment

and equipment are recorded at cost. Depreciation is computed using the straight-line method over the estimated useful lives of the related
assets, generally between three and five years. Expenditures that enhance the useful lives of the assets are capitalized and depreciated.

 Maintenance
and repairs are charged to expense as incurred. At the time of retirement or other disposition of property and equipment, the cost and
accumulated depreciation will be removed from the accounts and the resulting gain or loss, if any, will be reflected in operations.

 Impairment
of Long-Lived Assets

 We
review long-lived assets, including finite-lived intangible assets, for impairment whenever events or changes in circumstances indicate
that the carrying amount of such assets may not be recoverable. Recoverability of these assets is determined by comparing the forecasted
undiscounted net cash flows of the operation to which the assets relate to the carrying amount. Fair value is determined based on discounted
cash flows or appraised values, depending on the nature of the assets. During the year ended December 31, 2023, we recognized losses
on impairment of goodwill and intangible assets of $ 45,194,717 and $ 3,116,039, respectively. During the year ended December 31, 2022,
we did not record a loss on impairment.

Assets

 We
record our intangible assets at estimated fair value in accordance with Accounting Standards Codification ("ASC") 350, Intangibles
– Goodwill and Other. Finite lived intangible assets are amortized over their estimated useful life using the
straight-line method, which is determined by identifying the period over which the cash flows from the asset are expected to be
generated.

 F- 12

 Goodwil l

represents the excess of the purchase price of the acquired business over the estimated fair value of the identifiable net assets
acquired. Goodwill is not amortized but is tested for impairment at least annually during the fourth quarter, at the reporting unit
level or more frequently if events or changes in circumstances indicate that the asset might be impaired. Goodwill is tested for
impairment at the reporting unit level by first performing a qualitative assessment to determine whether it is more likely than not
that the fair value of the reporting unit is less than its carrying value. If the reporting unit does not pass the qualitative
assessment, then the reporting unit's carrying value is compared to its fair value. The fair values of the reporting units are
estimated using a market approach. Goodwill is considered impaired if the carrying value of the reporting unit exceeds its fair
value. Failure to maintain a similar market value may cause a future impairment of goodwill at the reporting unit level.

 Advertising
and Marketing Costs

 We
expense advertising and marketing costs as they are incurred. Advertising and marketing expenses were $ 474,121 and $ 804,218 for the years
ended December 31, 2023 and 2022, respectively, and are recorded in operating expenses on the consolidated statements of operations.

 Fair
Value Measurements

 As
defined in ASC 820, Fair Value Measurements and Disclosures, fair value is the price that would be received to sell an asset or
paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). We utilize market
data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks
inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated, or generally unobservable.
ASC 820 establishes a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority
to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable
inputs (Level 3 measurement). This fair value measurement framework applies at both initial and subsequent measurement.

 Level
 1:

 Quoted
 prices are available in active markets for identical assets or liabilities as of the reporting date. Active markets are those in
 which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing
 basis.

 Level
 2:

 Pricing
 inputs are other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as
 of the reported date. Level 2 includes those financial instruments that are valued using models or other valuation methodologies.
 These models are primarily industry-standard models that consider various assumptions, including quoted forward prices for commodities,
 time value, volatility factors, and current market and contractual prices for the underlying instruments, as well as other relevant
 economic measures. Substantially all of these assumptions are observable in the marketplace throughout the full term of the instrument,
 can be derived from observable data, or are supported by observable levels at which transactions are executed in the marketplace.

 Level
 3:

 Pricing
 inputs include significant inputs that are generally less observable from objective sources. These inputs may be used with internally
 developed methodologies that result in management's best estimate of fair value. The significant unobservable inputs used in
 the fair value measurement for nonrecurring fair value measurements of long-lived assets include pricing models, discounted cash
 flow methodologies and similar techniques.

 Fair
Value of Financial Instruments

 The
carrying value of cash, accounts receivable, accounts payable and accrued expenses, and other current liabilities approximate their fair
values using Level 3 inputs, based on the short-term maturity of these instruments. The carrying amount of loans and notes payable
approximate the estimated fair value for this financial instrument as management believes that such debt and interest payable on the
notes approximates our incremental borrowing rate. The long-lived assets (i.e., goodwill and intangible assets) were valued utilizing
Level 3 inputs. Significant unobservable inputs used in fair value measurement of the intangible assets include projected revenue, gross
profit and operating expenses, income tax rates, discount rates, royalty rates, and attrition rates.

 F- 13

 Net
Loss per Common Share

 Net
loss per common share is computed by dividing the net loss by the weighted average number of common shares outstanding during the period.
All outstanding options are considered potentially outstanding common stock. The dilutive effect, if any, of stock options is calculated
using the treasury stock method. All outstanding convertible notes are considered common stock at the beginning of the period or at the
time of issuance, if later, pursuant to the if-converted method. Since the effect of common stock equivalents is anti-dilutive with respect
to losses, the options and shares issuable upon conversion have been excluded from our computation of net loss per common share for the
years ended December 31, 2023 and 2022.

 On March 8, 2024, we filed an amendment to our certificate of incorporation
to effectuate a 1-for-15 reverse stock split. Our shares of outstanding common stock and earnings per share calculation have been retroactively
restated for all periods presented. The
following tables summarize the securities that were excluded from the diluted per share calculation because the effect of including these
potential shares was antidilutive due to our net loss position even though the exercise price could be less than the average market price
of the common shares:

OF SECURITIES EXCLUDED FROM DILUTED PER SHARE

 Stock options

 2,105,168

 2,426,428

 Warrants

 49,614

 9,614

 Convertible debt

 846,122

 28,715

 Total

 3,000,904

 2,464,757

 Stock-Based
Compensation

 We
apply the provisions of ASC 718, Compensation – Stock Compensation, which requires the measurement and recognition of compensation
expense for all stock-based awards made to employees and nonemployees, in the consolidated statements of operations.

 For stock options
issued to employees and members of our Board of Directors for their services, we estimate the grant date fair value of each option using
the Black-Scholes-Merton option pricing model. The use of the Black-Scholes-Merton option pricing model requires management to make assumptions
with respect to the expected term of the option, the expected volatility of the common stock consistent with the expected life of the
option, risk-free interest rates and expected dividend yields of the common stock. For awards subject to service-based vesting conditions,
including those with a graded vesting schedule, we recognize stock-based compensation expense equal to the grant date fair value of stock
options on a straight-line basis over the requisite service period, which is generally the vesting term. Forfeitures are recorded as
they are incurred. Due to our company's limited history and lack of public market for its common stock, we used the average of
historical share prices of our common stock and that of similar companies within our industry to calculate volatility for use in the
Black-Scholes-Merton option pricing model.

 We
issued shares of our stock to vendors and nonemployee for services provided. We recognize the accounting grant date fair value of
the stock award as compensation expense over the required service period of each award. Shares issued for services are measured
based on the fair market value of the underlying common stock on their respective accounting grant dates. New shares are issued upon
the exercise of stock options.

revenue primarily consists of billings or payments received from customers in advance of revenue recognized for the services provided
to our customers or annual licenses and is recognized as services are performed or ratably over the life of the license. We generally
invoice customers in advance or in milestone-based installments.

revenue consisted of the following:

 SCHEDULE OF DEFERRED REVENUE

31, 2023

31, 2022

 Current:

 $
 3,366,273

 $
 3,609,087

 792,696

 863,053

 Total deferred revenue - current

 $
 4,158,969

 $
 4,472,140

 Long-term:

 $

 $
 -

 Total deferred revenue – long term

 $

 $
 -

 F- 14

 The
increase in the deferred revenue balance is primarily driven by payments received in advance of satisfying our performance obligations,
offset by $ 4,120,260 of revenue recognized during 2023, which was included in the deferred revenue balance as of December 31, 2022. The
deferred revenue balance as of December 31, 2023 represents our remaining performance obligations that will be recognized as revenue
over the period in which the performance obligations are satisfied, and is expected to be recognized in revenue as follows:

OF PERFORMANCE OBLIGATIONS EXPECTED TO RECOGNIZED REVENUE

 2024

 2025

 Total

 $
 3,366,273

 $

 $
 4,466,007

 792,696

 -

 792,696

 Total deferred revenue

 $
 4,158,969

 $

 $
 5,258,703

 Foreign
Currency

 Our
functional and reporting currency is the U.S. dollar. For certain of our foreign subsidiaries whose functional currency is other than
the U.S. dollar, we translate revenue and expense transactions at average exchange rates. We translate assets and liabilities at period-end
exchange rates and include foreign currency translation gains and losses as a component of accumulated other comprehensive income.

 Leases

 Leases
in which our company is the lessee are comprised of corporate offices and property and equipment. All of the leases are classified as
operating leases. We lease multiple office spaces with a remaining weighted average term of 3.76 years.

 Right-of-use
("ROU") assets include any prepaid lease payments and exclude any lease incentives and initial direct costs incurred. Lease
expense for minimum lease payments is recognized on a straight-line basis over the lease term. The lease terms may include options to
extend or terminate the lease if it is reasonably certain that we will exercise that option.

 In
accordance with ASC 842, Leases, we recognized a ROU asset and corresponding lease liability on our consolidated balance sheet
for long-term office leases and a vehicle operating lease agreement. See Note 14 – Leases for further discussion, including the
impact on our consolidated financial statements and related disclosures.

 Income
Taxes

tax assets and liabilities are recognized for the future tax consequences attributable to differences between the consolidated financial
statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets, including tax loss
and credit carry forwards, and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which
those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in
tax rates is recognized in income in the period that includes the enactment date.

 We
utilize ASC 740, Income Taxes, which requires the recognition of deferred tax assets and liabilities for the expected future tax
consequences of events that have been included in the consolidated financial statements or tax returns. We account for income taxes using
the asset and liability method to compute the differences between the tax basis of assets and liabilities and the related financial amounts,
using currently enacted tax rates. A valuation allowance is recorded when it is "more likely than not" that a deferred tax
asset will not be realized. At December 31, 2023 and 2022, our net deferred tax asset has been fully reserved.

 F- 15

 For
uncertain tax positions that meet a "more likely than not" threshold, we recognize the benefit of uncertain tax positions
in the consolidated financial statements. Our practice is to recognize interest and penalties, if any, related to uncertain tax positions
in income tax expense in the consolidated statements of operations when a determination is made that such expense is likely.

 Emerging
Growth Company Status

 We
are an emerging growth company, as defined in the Jumpstart Our Business Startups Act of 2012 (the "JOBS Act"). Under the
JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the
JOBS Act until those standards apply to private companies. We have elected to use this extended transition period for complying with
new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date
that it is (i) no longer an emerging growth company or (ii) affirmatively and irrevocably opts out of the extended transition period
provided in the JOBS Act. As a result, these consolidated financial statements may not be comparable to companies that comply with the
new or revised accounting pronouncements as of public company effective dates. The JOBS Act does not preclude an emerging growth company
from early adopting new or revised accounting standards. We expect to use the extended transition period for any new or revised accounting
standards during the period which we remain an emerging growth company.

 Recently
Issued Accounting Standards

 In
October 2021, the Financial Standards Accounting Board (FASB) issued Accounting Standards Update (ASU) No. 2021-08, Business Combinations
(Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers. The new guidance requires contract
assets and contract liabilities acquired in a business combination to be recognized in accordance with ASC Topic 606 as if the acquirer
had originated the contracts. The ASU is applied prospectively and is effective for us for fiscal years beginning after December 15,
2022, and interim periods within those fiscal years. Early adoption is permitted. The adoption of this standard did not have a material
impact on our consolidated financial statements.

 In
November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures which expands
annual and interim disclosure requirements for reportable segments, primarily through enhanced disclosures about significant segment
expenses. ASU 2023-07 is effective for our annual periods beginning January 1, 2024, and for interim periods beginning January 1, 2025,
with early adoption permitted. We are currently evaluating the potential effect that the updated standard will have on our financial
statement disclosures.

 In
December 2023, the FASB issued ASU 2023-09, Income Taxes (Topics 740): Improvements to Income Tax Disclosures to expand the disclosure
requirements for income taxes, specifically related to the rate reconciliation and income taxes paid. ASU 2023-09 is effective for our
annual periods beginning January 1, 2025, with early adoption permitted. W e are currently evaluating
the potential effect that the updated standard will have on our financial statement disclosures.

 NOTE
4 – ACQUISITIONS

 True
Digital Security, Inc. Acquisition

 On
January 5, 2022, we entered into the True Digital Stock Purchase Agreement with certain stockholders of True Digital and the True Digital
Merger Agreement with True Digital and certain of its other stockholders. On January 19, 2022, the transactions contemplated by the True
Digital Stock Purchase Agreement and the True Digital Merger Agreement were consummated, with True Digital becoming a wholly owned subsidiary
of our company (the "True Digital Acquisition"). True Digital's outstanding common stock was exchanged for $ 6,153,000
in cash and 548,600 shares of our common stock.

 F- 16

 The
following table summarizes the allocation of the purchase price to the fair values of the assets acquired and the liabilities assumed
as of the transaction date:

OF SIGNIFICANT FAIR VALUE ASSETS ACQUIRED AND LIABILITIES

 Consideration

 $
 40,879,380

 Tangible assets acquired:

 Cash

 485,232

 Accounts receivable

 1,404,386

 Contract assets

 131,342

 196,825

 Property and equipment

 906,006

 Other assets

 17,505

 Total tangible assets

 3,141,296

 Intangible assets acquired:

 Tradename - trademarks

 1,744,200

 Intellectual property

 1,137,000

 Non-competes

 124,900

 Total intangible assets

 3,006,100

 Assumed liabilities:

 1,283,003

 Deferred revenue

 1,956,600

 Line of credit

 283,244

 181,741

 Loans payable - shareholder

 543,581

 Total assumed liabilities

 4,248,169

 Net assets acquired

 1,899,227

 Goodwill (a)

 $
 38,980,153

 (a)

 and intangibles are not deductible for tax purposes.

 Creatrix,
Inc. Acquisition

 On
June 1, 2022, we entered into a stock purchase agreement with the stockholders of Creatrix, pursuant to which Creatrix became our wholly
owned subsidiary. We anticipate that this will expand our professional services offerings and capabilities. Creatrix offers recognized
expertise in identity management as wells as systems integration and software engineering and specializes in biometrics, vetting, credentialing,
and case management.

 The
following table summarizes the allocation of the purchase price to the fair values of the assets acquired and the liabilities assumed
as of the transaction date:

OF SIGNIFICANT FAIR VALUE ASSETS ACQUIRED AND LIABILITIES

 Consideration paid

 $
 3,630,000

 Tangible assets acquired:

 Cash

 3,572

 Accounts receivable

 125,908

 Contract assets

 33,965

 3,597

 Total tangible assets

 167,042

 Assumed liabilities:

 48,001

 56,687

 Total assumed liabilities

 104,688

 Net assets acquired

 62,354

 Goodwill (a)

 $
 3,567,646

 (a)

 is not deductible for tax purposes.

 F- 17

 CyberViking,
LLC Acquisition

 On
July 1, 2022, we entered into a stock purchase agreement with the interest holders of CyberViking and its interest holders, pursuant
to which we acquired all of the issued and outstanding units of CyberViking, with CyberViking becoming a wholly owned subsidiary of our
company. We anticipate that this will expand our professional services offerings and capabilities. CyberViking specializes in application
security services, incident response, and threat hunting as well as the creation and management of security operation centers.

 We
did not acquire assets nor assume liabilities in our purchase of CyberViking, as a result the $ 1,836,320 of consideration paid is recognized
as goodwill. The goodwill is not deductible for tax purposes.

 CUATROi
Acquisition

 On
August 25, 2022, we entered into a stock purchase agreement with CUATROi and its partners, pursuant to which CUATROi became our wholly
owned subsidiary. We anticipate that this will expand our professional services offerings and capabilities. CUATROi is a cloud, managed
services provider and cybersecurity company with offices in South America.

 The
aggregate purchase price was allocated to the tangible and intangible assets acquired and liabilities assumed based on their estimated
fair values as of the acquisition date, with the excess recorded to goodwill.

 The
following table summarizes the allocation of the purchase price to the fair values of the assets acquired and the liabilities assumed
as of the transaction date:

OF SIGNIFICANT FAIR VALUE ASSETS ACQUIRED AND LIABILITIES

 Consideration paid

 $
 6,847,474

 Tangible assets acquired:

 Cash

 77,804

 Accounts receivable

 478,210

 51,464

 Property and equipment

 434,816

 Total tangible assets

 1,042,294

 Intangible assets acquired:

 Customer base

 1,240,000

 Total intangible assets

 1,240,000

 Assumed liabilities:

 242,830

 850,199

 Total assumed liabilities

 1,093,029

 Net assets acquired

 1,189,265

 Goodwill (a)

 $
 5,658,209

 (a)

 and intangibles are not deductible for tax purposes.

 NLT
Secure Acquisition

 On
September 1, 2022, we entered into a stock purchase agreement with NLT Secure and its interest holders, pursuant to which we acquired
all of the issued and outstanding units of NLT Secure becoming a wholly owned subsidiary of our company. We anticipate that this will
expand our professional services offerings and capabilities. NLT Secure provides a broad range of security solutions and managed services
to organizations throughout South America.

 F- 18

 The
aggregate purchase price was allocated to the tangible and intangible assets acquired and liabilities assumed based on their estimate
fair values as of the acquisition date, with the excess recorded to goodwill.

 The
following table summarizes the allocation of the purchase price to the fair values of the assets acquired and the liabilities assumed
as of the transaction date:

OF SIGNIFICANT FAIR VALUE ASSETS ACQUIRED AND LIABILITIES

 Consideration paid

 $
 6,919,597

 Tangible assets acquired:

 Cash

 48,858

 Accounts receivable

 66,972

 154,300

 Property and equipment

 1,071,401

 Total tangible assets

 1,341,531

 Assumed liabilities:

 791,228

 1,778,591

 Total assumed liabilities

 2,569,819

 Net liabilities assumed

 1,228,288

 Goodwill (a)

 $
 8,147,885

 (a)

 is not deductible for tax purposes.

 NOTE
5 – PREPAID EXPENSES AND OTHER CURRENT ASSETS

 Prepaid
expenses and other current assets consisted of:

OF PREPAID EXPENSES AND OTHER CURRENT ASSETS

 Prepaid expenses

 $
 253,953

 $
 987,651

 Prepaid taxes

 886,920

 572,645

 Prepaid insurance

 59,398

 164,354

 Total prepaid expenses and other current assets

 $
 1,200,271

 $
 1,724,650

 NOTE
6 – PROPERTY AND EQUIPMENT

and equipment consisted of the following:

OF PROPERTY AND EQUIPMENT

 Computer equipment

 $
 1,277,609

 $
 1,264,713

 Building

 1,715,929

 1,776,040

 Leasehold improvements

 527,705

 541,647

 Vehicle

 -

 28,229

 Furniture and fixtures

 128,904

 151,142

 Software

 1,728,126

 1,667,283

 Property and equipment
 gross

 5,378,273

 5,429,054

 Less: accumulated depreciation

 ( 1,700,799
)

 ( 748,559
)

 Property and equipment, net

 $
 3,677,474

 $
 4,680,495

 Total
depreciation expense was $ 1,099,048 and $ 736,181 for the years ended December 31, 2023 and 2022, respectively.

 F- 19

 NOTE
7 – INTANGIBLE ASSETS AND GOODWILL

the year ended December 31, 2023, our share price reduction was determined to be an indicator of impairment under ASC 350 of our two
reporting units, United States and Latin America. We performed ongoing assessments to consider whether events or circumstances had occurred
that could more likely than not reduce the fair value of a reporting unit below its carrying value. The valuation limitation from our
recent share price decline caused us to perform a goodwill impairment test as of December 31, 2023.

 Based
on the results of this testing, for the year ended December 31, 2023, we recorded a pre-tax, non-cash impairment charge related to the
United States reporting unit and Latin America reporting unit of $ 35,933,364 and $ 9,261,353, respectively. This charge is recorded as
Impairment of goodwill on the Consolidated Statements of Operations and Comprehensive Loss. The reduction in fair value for the reporting units, and corresponding impairment charge, was
primarily driven by the decline in our share price and uncertainty surrounding
our company and a decrease in forecasted near-term cashflows of our reporting units.

 As part of our quantitative testing process for goodwill of the reporting
units, we estimated fair values using a market approach.

 The
following table summarizes the changes in goodwill during the years ended December 31, 2023 and 2022, respectively:

OF CHANGES IN GOODWILL

 Balance as of December 31, 2021

 $
 38,870,599

 Accumulated impairment losses

 ( 22,078,064
)

 16,792,535

 Goodwill acquired during year

 58,190,213

 Foreign currency translation adjustment

 1,237,153

 Other

 444,116

 Balance as of December 31, 2022

 $
 98,742,081

 Accumulated impairment losses

 ( 22,078,064
)

 76,664,017

 Foreign currency translation adjustment

 50,544

 Impairment losses

 ( 45,194,717
)

 Balance as of December 31, 2023

 98,792,625

 Accumulated impairment losses

 ( 67,272,781

)

 $
 31,519,844

Assets

 We
performed an impairment test of our intangible assets based upon the conditions that precipitated the goodwill impairment test described
above.

 Based
on the results of this testing, we recorded a pre-tax, non-cash impairment charge totaling $ 3,116,039 for the year ended December 31,
2023, related to our customer base, intellectual property, tradenames-trademarks and non-compete, which is included in the net carry
amount of intangibles in the table below. These charges were recorded in Selling, general and administrative expenses on the Consolidated
Statement of Operations and Comprehensive Loss.

 Fair
values used in testing for potential impairment of our intangible assets are calculated using a discounted cash flows method by applying
estimated cash flows from our forecasted revenue and expenses of the business that utilize those assets. The assumed cash flows from
this calculation are discounted at a rate based on a market participant discount rate.

 F- 20

 There is uncertainty surrounding the revenue and cost growth factors for
these assets and a change in the long-term revenue and cost growth rate or increase in the discount rate assumption could increase the
likelihood of a future impairment.

 Following
the recognition of the impairment losses, the affected assets had an aggregate carrying value of $ 455,809 as of December 31, 2023.

assets, net are summarized as follows:

OF IDENTIFIABLE INTANGIBLE ASSETS

 Gross Carrying Amount

 Accumulated Amortization

 Net Carrying Amount

 Gross Carrying Amount

 Accumulated Amortization

 Net Carrying Amount

 Tradenames – trademarks

 $
 4,037,142

 $
 ( 2,329,498
)

 $
 1,707,644

 Customer base

 1,145,378

 ( 639,937
)

 505,441

 Non-compete agreements

 685,651

 ( 630,595
)

 55,056

 Intellectual property/technology

 2,588,560

 ( 1,078,457
)

 1,510,103

 Intangible Asset

 $
 8,456,731

 $
 ( 4,678,487
)

 $
 3,778,244

 Gross Carrying Amount

 Accumulated Amortization

 Net Carrying Amount

 Gross Carrying Amount

 Accumulated Amortization

 Net Carrying Amount

 Tradenames – trademarks

 $
 4,744,409

 $
 ( 1,167,476
)

 $
 3,576,933

 Customer base

 2,949,143

 ( 449,565
)

 2,499,578

 Non-compete agreements

 796,583

 ( 436,611
)

 359,972

 Intellectual property/technology

 2,659,391

 ( 620,645
)

 2,038,746

 Intangible Asset

 $
 11,149,526

 $
 ( 2,674,297
)

 $
 8,475,229

 Amortization
expense of identifiable intangible assets was $ 2,044,999 and $ 2,338,273, for the years ended December 31, 2023 and 2022, respectively.
As of December 31, 2023, the weighted-average remaining amortization period for intangible assets was 2.70 years.

 Based
on the balance of intangibles assets at December 31, 2023, expected future amortization expense is as follows:

OF FUTURE AMORTIZATION EXPENSE

 2024

 $
 1,808,849

 2025

 983,019

 2026

 772,645

 2027

 115,331

 2028

 49,200

 Thereafter

 49,200

 Future Amortization Expense

 $
 3,778,244

 NOTE
8 – ACCOUNTS PAYABLE AND ACCRUED EXPENSES

 Accounts
payable and accrued expenses consisted of the following amounts:

OF ACCOUNTS PAYABLE AND ACCRUED EXPENSES

 Accounts payable

 $
 11,045,657

 $
 5,267,492

 Accrued payroll and bonuses

 1,873,848

 1,274,919

 Accrued expenses

 1,650,624

 740,231

 Accrued commissions

 100,000

 305,768

 Indirect taxes payable

 793,347

 556,151

 Accrued interest

 487,851

 165,776

 Total accounts payable and accrued expenses

 $
 15,951,327

 $
 8,310,337

 F- 21

 Note
9 - RELATED PARTY TRANSACTIONS

 Independent
Consulting Agreement with Stephen Scott

 In
August 2020, we entered into an Independent Consulting Agreement with Stephen Scott, a then director of our company, with respect to
advisory and consulting services relating to our strategic and business development, and sales and marketing. Mr. Scott receives a consulting
fee of $ 11,500 per month for such services.

 In
July 2023, we entered into an Independent Consulting Agreement with Mr. Scott, to provide, on a non-exclusive basis, advisory and consulting
services relating to our strategic and business development, intellectual property development, banking relationships, and strategic
M&A for a period of one year. Mr. Scott will receive a consulting fee of $ 15,000 per month for such services under the terms of this
agreement. During the years ended December 31, 2023 and 2022, we paid consulting fees to Mr. Scott in the amounts of $ 159,000 and $ 138,000,

 Convertible
Note Payable – Related Party

 In
March 2023, we issued an unsecured convertible note to Hensley & Company in the principal amount of $ 5,000,000
bearing an interest rate of 10.00 %
per annum. The principal amount, together with accrued and unpaid interest is due on March
20, 2025. At any time prior to or on the maturity date, Hensley & Company is permitted to convert all or any portion of
the outstanding principal amount and all accrued and unpaid interest thereon into shares of our common stock at a conversion price
of $ 18.00
per share ($ 1.20 on a pre-reverse split basis). During the year ended December 31, 2023, we recorded interest expense of $ 388,888
and as of December 31, 2023, we had accrued interest of $ 388,888.
Andy McCain, a director of our company, is President and Chief Executive officer of Hensley & Company.

Services Agreement with Hensley Beverage Company – Related Party

 In
July 2021, we entered into a 1-year Managed Services Agreement with Hensley Beverage Company, an entity affiliated with Mr. McCain, a
director of our company, to provide secured managed services. We also may be engaged by Hensley Beverage Company from time to time to
provide other related services outside the scope of the Managed Services Agreement. While the agreement provides for a term through December
31, 2021, the agreement will continue until terminated by either party. For the years ended December 31, 2023 and 2022, we received
$ 1,417,398 and $ 850,445, respectively from Hensley Beverage Company for contracted services and had an outstanding receivable balance
of $ 152,213 and $ 15,737 as of December 31, 2023 and 2022, respectively.

 Note
10 - STOCKHOLDERS' EQUITY

 Our
amended and restated certificate of incorporation authorized the issuance of up to 300,000,000 shares of common stock and 50,000,000
shares of undesignated preferred stock, each having a par value of $ 0.00001 per share. Shares of common stock have both economic and
voting rights.

 Equity
Transactions

the years ended December 31, 2023 and 2022, we issued an aggregate of 1,782,658
and 160,833
shares of common stock ( 26,739,853 and 2,412,474 on a pre-reverse split basis) to investors for cash proceeds of $ 6,682,198
and $ 10,689,087,

the years ended December 31, 2023 and 2022, we issued an aggregate of 366,667 and 60,655 shares
of common stock ( 5,500,000 and 909,819 on a pre-reverse split basis), respectively, to consultants, lenders, and vendors for services rendered.

 In
January 18, 2022, we issued a warrant to the underwriter of our Form S-1 to purchase an aggregate 9,614
shares of our common stock ( 144,200 on a pre-reverse split basis). The warrant is exercisable for a period of 5
years from the date of issuance at an exercise price of $ 75.00
per share ($ 5.00 on a pre-reverse split basis).

 On
May 19, 2023, we completed a $ 4,000,000
registered direct offering of our common stock, pursuant to which 1,333,334
shares of our common stock ( 20,000,000 on a pre-reverse split basis) were issued. In addition, we granted the placement agent
warrants to purchase 40,000
shares ( 600,000 on a pre-reverse split basis) of our common stock at a price of $ 3.75
per share ($ 0.25 on a pre-reverse split basis). We have used the net proceeds from the offering to repay $ 2,000,000
in outstanding principal of short-term indebtedness and for general corporate purposes. The warrant is exercisable at any time on or
after November 12, 2023, and expires on May
16, 2028.

 F- 22

 The
follow table summarizes warrant activity:

OF STOCK WARRANT ACTIVITY

 Weighted
 Average
 Exercise
 Price

 Weighted
 Average
 Remaining
 Contractual
 Life
 (in years)

 Aggregate
 Intrinsic
 Value

 Outstanding at January 1, 2022

 -

 $
 -

 -

 $
 -

 Granted

 9,614

 75.00

 -

 -

 Exercised

 -

 -

 -

 -

 Expired or cancelled

 -

 -

 -

 -

 Outstanding at December 31, 2022

 9,614

 $
 75.00

 4.01

 $
 -

 Exercisable at December 31, 2022

 9,614

 $
 75.00

 4.01

 $
 -

 Weighted
 Average

 Exercise
 Price

 Weighted

 Average

 Remaining

 Contractual

 Life
 (in years)

 Aggregate

 Intrinsic

 Value

 Outstanding
 at January 1, 2023

 9,614

 $

 75.00

 4.01

 $

 -

 Granted

 40,000

 3.75

 5.00

 -

 Exercised

 -

 -

 -

 -

 Expired
 or cancelled

 -

 -

 -

 -

 Outstanding
 at December 31, 2023

 49,614

 $

 17.56

 4.12

 $

 -

 Exercisable
 at December 31, 2023

 49,614

 $

 17.56

 4.12

 $

 -

 Note
11 – STOCK-BASED COMPENSATION

 2023
Equity Incentive Plan

 Our
2023 Equity Incentive Plan (the "2023 Plan"), which replaces our 2019 Equity Incentive Plan (the "2019
Plan"), became effective on September 13, 2023. The total number of shares of our common stock reserved and available for
delivery under the 2023 Plan at any time during the term of the 2023 Plan will be 2,666,667
shares ( 40,000,000 on a pre-reverse split basis) plus any remaining available for delivery under the 2019 Plan on the effective date
of the 2023 Plan. As of the effective date of the 2023 Plan, there were 1,455,983
shares ( 21,839,752 on a pre-reverse split basis) remaining available for delivery under the 2019 Plan. Therefore, as of September
13, 2023, there were an aggregate of 4,122,650
shares ( 61,839,752 on a pre-reverse split basis) reserved and available for delivery under the 2023 Plan. In addition, to the extent
that any stock options pursuant to the 2019 Plan expire, terminate or are canceled or forfeited under the terms of the 2019 Plan,
the shares of common stock reserved for issuance pursuant to such stock options will become available for issuance under the 2023
Plan.

 Options

 We
granted options for the purchase of 326,512
and 1,049,489
shares of common stock ( 4,900,833 and 17,457,613 on a pre-reverse split basis) during the year ended December 31, 2023 and 2022,

 In
applying the Black-Scholes option pricing model to stock options granted, we used the following assumptions:

OF BLACK-SCHOLES STOCK OPTIONS GRANTED

 For
 the Year Ended

 For
 the Year Ended

 31, 2023

 31, 2022

 Risk free interest
 rate

 3.46 %
 - 4.79
 %

 1.43 %
 - 4.22
 %

 Contractual term (years)

 5.00
 – 10.00

 5.00
 – 10.00

 Expected volatility

 94.58 %
 - 136.47
 %

 87.11 %
 - 90.90
 %

 Expected dividend yield

 -
 %

 -
 %

 F- 23

 The
follow table summarizes stock option activity:

OF STOCK OPTION ACTIVITY

 Weighted Average Exercise Price

 Weighted Average Remaining Contractual Life (in years)

 Aggregate Intrinsic Value

 Outstanding at January 1, 2022

 2,205,824

 $
 27.60

 -

 $
 -

 Granted

 1,049,489

 52.65

 -

 -

 Exercised

 ( 179,268
)

 8.25

 -

 -

 Expired or cancelled

 ( 649,617
)

 45.45

 -

 -

 Outstanding at December 31, 2022

 2,426,428

 36.73

 -

 -

 Granted

 326,512

 6.15

 -

 -

 Exercised

 ( 69,378
)

 7.18

 -

 -

 Expired or cancelled

 ( 578,394
)

 41.56

 -

 -

 Outstanding at December 31, 2023

 2,105,168

 $
 31.63

 4.40

 $
 1,542

 Exercisable at December 31, 2023

 1,514,541

 $
 28.53

 3.18

 $
 -

 The
aggregate intrinsic value for stock options outstanding and exercisable is defined as the positive difference between the fair market
value of our common stock and the exercise price of the stock options.

 Total
compensation expense related to the options was $ 11,469,667 and $ 15,464,587 for the years ended December 31, 2023 and 2022, respectively.
As of December 31, 2023, there was future compensation expense of $ 16,337,762 with a weighted average recognition period of 1.85 years
related to the options. The weighted-average grant-date fair value of options granted during the years 2023 and 2022 was $ 2.57 and $ 38.82,
respectively. The total intrinsic value of options exercised during the years ended December 31, 2023 and 2022, was $ 887,595 and $ 7,164,856,

the year-ended December 31, 2023, 317,929 options vested, net of forfeitures.

 NOTE
12 – COMMITMENTS AND CONTINGENCIES

 Legal
Claims

 From
time-to-time, we are a party to litigation and subject to claims, suits, regulatory and government investigation, other proceedings and
consent decrees in the ordinary course of business. We investigate claims as they arise and accrue estimates for resolutions of legal
and other contingencies when losses are probable and reasonably estimable.

 There
are no material pending legal proceedings in which we or any of our subsidiaries is a party or in which any of our directors,
officers or affiliates, any owner of record or beneficially
of more than 5% of any class of our voting securities, or security holder is a party adverse to us or has a material interest
adverse to us. While the results of such normal course claims and legal proceedings, regardless of the underlying nature of
the claims, cannot be predicted with certainty, management believes, based on current knowledge and the likely timing of resolution
of various matters, any additional reasonably possible potential losses above the amounts accrued for such matters would not be
material. However, the outcome of claims, legals proceedings or investigations are inherently unpredictable and subject to
uncertainty, and may have an adverse effect on us because of defense costs, diversion of management resources and other factors that
are not known to us or cannot be quantified at this time. We may also receive unfavorable preliminary or interim rulings in the
course of litigation, and there can be no assurances that favorable final outcomes will be obtained. The final outcome of any
current or future claims or lawsuits could adversely affect our business, financial condition or results of operations. We
periodically evaluate developments in our legal matters that could affect the amount of liability that has been previously accrued
or the reasonably possible losses that we have disclosed, and make adjustments as appropriate.

 Indirect
Taxes

 We
are subject to indirect taxation in some, but not all, of the various states and foreign jurisdictions in which we conduct business.
Laws and regulations attempting to subject commerce conducted over the Internet to various indirect taxes are becoming more prevalent,
both in the United States and internationally, and may impose additional burdens on us in the future. Increased regulation could negatively
affect our business directly, as well as the business of our customers. Taxing authorities may impose indirect taxes on the Internet-related
revenue we generated based on regulations currently being applied to similar, but not directly comparable industries. There are many
transactions and calculations where the ultimate indirect tax determination is uncertain. In addition, domestic and international indirect
taxation laws are complex and subject to change. We may be audited in the future, which could result in changes to our indirect tax estimates.
We continually evaluate those jurisdictions in which nexus exists, and believe we maintain adequate indirect tax accruals.

 As
of December 31, 2023 and 2022, our accrual for estimated indirect tax liabilities was $ 793,347 and $ 409,187, respectively, reflecting
our best estimate of the potential liability based on an analysis of our business activities, revenues subject to indirect taxes, and
applicable regulations. Although we believe our indirect tax estimates and associated liabilities are reasonable, the final determination
of indirect tax audits, litigation, or settlements could be materially different than the amounts established for indirect tax contingencies.

 F- 24

 Warranties

 Our
services are generally warranted to deliver and operate in a manner consistent with general industry standards that are reasonably applicable
and materially conform with our documentation under normal use and circumstances.

 We
offer a limited warranty to certain customers, subject to certain conditions, to cover certain costs incurred by the customer in case
of a security breach. We have entered into an insurance policy to cover our potential liability arising from this limited warranty arrangement.
We have not incurred any material costs related to such obligations and have not accrued any liabilities related to such obligations
in the consolidated financial statements as of December 31, 2023 and 2022.

 In
addition, we also indemnify certain of our directors and executive officers against certain liabilities that may arise while they are
serving in good faith in their company capacities. We maintain director and officer liability insurance coverage that would generally
enable us to recover a portion of any future amounts paid.

 NOTE
13 – LOANS PAYABLE, CONVERTIBLE NOTE PAYABLE AND LINES OF CREDIT

 Loans
Payable

 Loans
payable was as follows:

OF LOAN PAYABLE

 Effective Interest Rate

 Maturities

 Term loans (US dollar denominated)

 4.00 % – 71.55
 %

 2023 - 2027

 $
 1,899,035

 $
 5,461,520

 Term loans (Chilean peso denominated)

 3.48 % - 19.20
 %

 2023 - 2031

 4,541,217

 6,541,113

 6,440,252

 12,002,633

 Less current portion

 ( 3,691,464
)

 ( 7,758,831
)

 Long term loans payable

 $
 2,748,788

 $
 4,243,802

 Bridge Loan

 We
entered into a bridge loan with Bell Bank (the "Bell Bank Note"), secured by substantially all of our assets, in the
principal amount of $ 5,000,000
bearing an interest rate of 4.00 %
per annum payable monthly with a maturity date of December
14, 2022, which was extended to March 14, 2023. We did not repay this bridge loan on the maturity date, which resulted in an
event of default under the terms thereof. As a result, the interest rate applicable to amounts due under this bridge loan increased
from 4.00 %
to 7.50 %.
This bridge loan was repaid in full on March 20, 2023. We recorded interest expense of $ 116,667
and $ 114,167
for the years ended December 31, 2023 and 2022, respectively, and had accrued interest of zero
and $ 4,167
as of December 31, 2023 and 2022, respectively.

 Term
Loans

 Various
subsidiaries in the United States are borrowers under certain term loans. These term loans require monthly principal and interest payments.
The term loans are secured by various assets owned by our subsidiaries. We recorded aggregate interest expense of these term loans of
$ 20,605 and $ 50,754 for the years ended December 31, 2023 and 2022, respectively. Accrued interest for the loans was zero and $ 13,435
as of December 31, 2023 and 2022, respectively. The aggregate effective interest rate of the terms loans was 8.61 %.

 Our
Latin America subsidiaries are the borrowers under certain term loans denominated in Chilean Pesos. These term loans require monthly
principal and interest payments. The loans are secured by various assets owned by our subsidiaries. We recorded aggregate interest expense
on these term loans of $ 617,804 and $ 318,055 for the years ended December 31, 2023 and 2022, respectively. The aggregate effective interest
rate of these term loans was 11.15 %.

 In
March 2023, we entered into a cash advance agreement, pursuant to which we received gross proceeds of $ 2,000,000 and paid $ 87,500 in
upfront fees. The terms of the cash advance agreement called for us to remit aggregate weekly payments of $ 99,398 until such time as
we had repaid $ 2,870,000. This cash advance agreement was secured by the accounts receivable of CISO Global Inc. and our wholly owned
subsidiaries, Talatek, LLC and True Digital Security, Inc. We recorded interest expense of $ 978,833 for the year ended December 31, 2023.

 F- 25

 In
August 2023, we entered into a second cash advance agreement, pursuant to which we received gross proceeds of $ 2,000,000 and paid $ 50,000
in upfront fees. The terms of the second cash advance agreement called for us to remit weekly payments of $ 80,588 until such time as
we had repaid $ 2,740,000. This cash advance agreement was secured by the accounts receivable of CISO Global Inc. and our wholly owned
subsidiaries, Talatek, LLC and True Digital Security, Inc. We recorded interest expense of $ 468,707 for the year ended December 31, 2023.

 In
November 2023, we entered into a business loan and security agreement, pursuant to which we obtained a loan with a principal amount
of $ 2,200,000
and paid an origination fee of $ 44,000.
The business loan bears interest at a rate of 53.44 %
per annum and is payable in 52 weekly installments of $ 53,731.
We may prepay the loan in whole or in part, but partial repayments do not reduce the total interest payable on the loan, of $ 594,000.
The business loan is secured by all of the assets of our US subsidiaries. The proceeds of the loan were used to repay in full the
amount owned under our cash advance agreements that we entered into in March and August 2023. For the year ended December 31, 2023,
we recorded interest expense of $ 200,881.

 In
connection with the business loan, we entered into a fee agreement pursuant to which we issued 133,334
shares ( 2,000,000 on a pre-reverse split basis) of our common stock as partial consideration for the lender to enter into the
business loan and extend credit to us. We recorded the issuance of our common stock as a discount to the business loan, which is
amortized using the effective interest method over the term of the loan.

 Convertible
Notes Payable

 In
October 2021, we issued to Neil Stinchcombe, a convertible note in the principal amount of $ 1,500,000
bearing an interest rate of 5.00 %
per annum payable at maturity with a maturity date of January
27, 2022, with a conversion price of $ 75.00
per share ($ 5.00 on a pre-reverse split basis). On March 10, 2022, we entered into Amendment #1 to the note pursuant to which the maturity date was extended to October
27, 2022. On March 27, 2023, we entered into a letter agreement with Neil Stinchcombe to resolve certain payment terms of his
convertible note. We agreed to repay the principal amount of the note in three equal installment payments of $ 500,000
on each of March 31, April 28 and May 31, 2023, with accrued interest to be paid on May 31, 2023 at the note's reflected
interest rate of 5.00 %
per annum. The principal amount of this note, plus all accrued interest was repaid in full under the terms of the letter agreement.
For the years ended December 31, 2023 and 2022, we recorded interest expense (recovery) of ($ 16,970)
and $ 106,507.

 In
June 2022, we issued an unsecured convertible note payable in the principal amount of $ 1,000,000
bearing an interest rate of 5.00 %
per annum payable monthly with a maturity date of June 2023, with a conversion price of $ 117.45 ($ 7.83 on a pre-reverse split basis). The
outstanding principal of this note can be redeemed at any time by us or at maturity at 105%. At maturity in June 2023, we
repaid the unpaid accrued interest on this convertible note and rolled the principal amount of $ 1,050,000
into a new convertible note with the lender. We recorded interest expense of $ 22,101
and $ 79,167
for the years ended December 31, 2023 and 2022, respectively.

 In
June 2023, we issued an unsecured convertible note in the principal amount of $ 1,050,000 bearing an interest rate of 10.00 % per annum
payable monthly. The principal amount, together with accrued and unpaid interest is due on June 7, 2024. At any time prior to or on the
maturity date the holder is permitted to convert all of the outstanding principal amount into 4.20 % of the authorized units of our wholly
owned subsidiary vCISO, LLC. We recorded interest expense of $ 61,954 for the year ended December 31, 2023. Accrued interest as of December
31, 2023 was $ 61,954.

 In
March 2023, we issued an unsecured convertible note to Hensley & Company in the principal amount of $ 5,000,000
bearing an interest rate of 10.00 %
per annum. The principal amount, together with accrued and unpaid interest is due on March
20, 2025. At any time prior to or on the maturity date, Hensley & Company is permitted to convert all or any portion of
the outstanding principal amount and all accrued but unpaid interest thereon into shares of our common stock at a conversion price
of $ 18.00
per share ($ 1.20 on a pre-reverse split basis). During the year ended December 31, 2023, we recorded interest expense of $ 388,888.
Accrued interest as of December 31, 2023 was $ 388,888.
Mr. McCain, a director of our company, is President and Chief Executive Officer of Hensley & Company.

 In
October 2023, we issued an unsecured convertible note in the principal amount of $ 1,000,000
bearing an interest rate of 12.00 %
per annum payable monthly. The principal amount, together with accrued and unpaid interest is due on October
12, 2024. At any time prior to or on the maturity date the holder is permitted to convert all of the outstanding principal
amount into shares of our common stock at a conversion price of $ 1.7595
per share ($ 0.1173 on a pre-reverse split basis). We recorded interest expense of $ 26,983
for the year ended December 31, 2023. Accrued interest as of December 31, 2023 was $ 26,983.

 F- 26

 Future
minimum payments under the above debt instruments following the year ended December 31, 2023, are as follows:

OF FUTURE MINIMUM PAYMENTS FOR LONG TERM DEBT

 2024

 $
 5,867,234

 2025

 6,522,165

 2026

 535,515

 2027

 293,634

 2028

 246,145

 Thereafter

 344,110

 Total future minimum payments

 13,808,803

 Less: discount

 ( 318,551
)

 Total

 13,490,252

 Less: current

 ( 5,741,464
)

 Long term debt, net

 $
 7,748,788

 NOTE
14 – LEASES

the years ended December 31, 2023 and 2022, we recognized additional ROU assets and lease liabilities of $ 733,782 and $ 476,986, respectively.
We elected to not recognize ROU assets and lease liabilities arising from short-term office leases, leases with initial terms of twelve
months or less (deemed immaterial) on the consolidated balance sheets.

 When
measuring lease liabilities for leases that were classified as operating leases, we discounted lease payments using its estimated incremental
borrowing rate. The weighted average incremental borrowing rate applied was 9.99 %. As of December 31, 2023, our leases had a remaining
weighted average term of 3.76 years.

 The
following table presents net lease cost and other supplemental lease information:

OF LEASE COST AND OTHER SUPPLEMENT LEASE INFORMATION

 Year Ended

 Year Ended

 Lease cost

 Operating lease cost (cost resulting from lease payments)

 $
 270,638

 $
 259,033

 Short term lease cost

 156,828

 66,658

 Net lease cost

 $
 427,466

 $
 325,691

 Operating lease – operating cash flows (fixed payments)

 $
 270,638

 $
 259,003

 Operating lease – operating cash flows (liability reduction)

 $
 199,069

 $
 233,425

 Non-current leases – right of use assets

 $
 762,228

 $
 255,687

 Current liabilities – operating lease liabilities

 $
 219,342

 $
 121,731

 Non-current liabilities – operating lease liabilities

 $
 596,307

 $
 159,205

 Future
minimum payments under non-cancelable leases for operating leases for the remaining terms of the leases following the year ended December
31, 2023, are as follows:

OF FUTURE MINIMUM UNDER NON-CANCELLABLE LEASES FOR OPERATING LEASES

 Fiscal Year

 Operating Leases

 2024

 $
 293,689

 2025

 252,040

 2026

 198,690

 2027

 204,644

 2028

 53,816

 Total future minimum lease payments

 1,002,879

 Amount representing interest

 ( 187,230
)

 Present value of net future minimum lease payments

 $
 815,649

 F- 27

 NOTE
15 – INCOME TAXES

 For
the years ended December 31, 2023, and 2022, the income tax benefit consisted of the following:

 SCHEDULE OF
INCOME TAX BENEFIT

 2023

 2022

 Year Ended December 31,

 2023

 2022

 Current:

 Federal

 $
 -

 $
 -

 Foreign

 -

 1,432

 State

 -

 6,869

 Total current income taxes

 $
 -

 $
 8,301

 Federal

 $
 -

 $
 ( 95,018
)

 Foreign

)

 100,466

 State

 -

 ( 14,298
)

 Total deferred income taxes

 $

)

 $
 ( 8,850
)

 Total

 $

)

 $
 ( 549
)

 A
reconciliation of the statutory federal income tax benefit to actual tax benefit for the years ended December 31, 2023 and 2022 is as
follows:

 SCHEDULE OF STATUTORY FEDERAL INCOME TAX BENEFIT TO ACTUAL TAX BENEFIT

 Year
 Ended December 31,

 2023

 2022

 Computed
 tax benefit at statutory rate

 21.00

 %

 21.00

 %

 Stock-based
 compensation

 ( 3.28

)%

 ( 5.10

)%

 Change
 in valuation allowance

 ( 10.77

)%

 ( 9.12

)%

 Return
 to provision adjustments

 ( 6.81

)%

 ( 6.39

)%

 Other,
 net

 ( 0.14

)%

 ( 0.39

)%

 Effective
 tax rate

 0.00

 %

 0.00

 %

 The
tax effects of temporary differences that give rise to significant portions of the deferred tax assets and liabilities were as follows
as of December 31, 2023 and 2022:

 SCHEDULE OF DEFERRED TAX ASSETS AND LIABILITIES

 2023

 2022

 Year
 Ended December 31,

 2023

 2022

 tax assets:

 and equipment

 $

 213,643

 $

 69,252

 Allowance
 for doubtful accounts

 53,700

 143,804

 Net
 operating loss carryforwards

 9,696,873

 1,452,734

 Stock-based
 compensation

 9,841,300

 4,303,860

 Accounts
 payable and accrued liabilities

 307,842

 3,191

 impairment

 12,298,349

 -

 Other

 19,770

 208,043

 Total
 deferred tax assets

 $

 32,431,477

 $

 6,180,884

 Valuation
 allowance

 ( 31,988,729

)

 ( 4,381,644

)

 Net
 deferred income taxes

 $

 442,748

 $

 1,799,240

 tax liabilities

 assets

 $

 ( 326,448

)

 $

 ( 2,041,418

)

 Prepaid
 expenses

 ( 116,300

)

 ( 193,500

)

 Total
 deferred tax liabilities

 ( 442,748

)

 ( 2,234,918

)

 Net
 deferred tax liabilities

 $

 -

 $

)

 Net
 deferred tax liability by jurisdiction

 Domestic

 $

 -

 $

 -

 Chile

 -

)

 Peru

 -

 -

 Colombia

 -

 -

 Total

 $

 -

 $

)

 F- 28

 We
account for deferred taxes under ASC 740, Income Taxes, which requires a reduction of the carrying amounts of deferred tax assets by
a valuation allowance if, based on available evidence, it is more likely than not that such assets will not be realized. Accordingly,
the need to establish valuation allowances for deferred tax assets is assessed periodically based on the ASC 740 more-likely-than-not
realization threshold criterion. This assessment considers matters such as future reversals of existing taxable temporary differences,
projected future taxable income, tax-planning strategies, legislative developments, and results of recent operations. The evaluation
of the recoverability of the deferred tax assets requires that we weigh all positive and negative evidence to reach a conclusion that
it is more likely than not that all or some portion of the deferred tax assets will not be realized. The weight given to the evidence
is commensurate with the extent to which it can be objectively verified.

 We have provided a valuation allowance
for our net deferred tax assets at December 31, 2023 and 2022, due to the uncertainty surrounding the future realization of such assets
and the cumulative losses we have generated. Therefore, no benefit has been recognized in the financial statements for the net operating
loss carryforwards and other deferred tax assets. During the years ended December 31, 2023 and 2022, respectively, the valuation allowance
increased by $ 27,607,085 and decreased by $ 4,555,842, respectively.

 As of December 31, 2023, we had
approximately $ 34,870,734 of consolidated federal net operating loss carryforwards and $ 39,385,617 of apportioned state net operating
loss carryforwards available to offset future taxable income, respectively. If unused, the federal and state net operating loss carryforwards
will begin to expire in 2032. Additionally, we had $ 3,579,475 of net operating loss carryforwards from our subsidiaries located in Latin
America, primarily within Chile. An indefinite carryforward of losses is allowed in Chile. The net operating loss carryforward in Peru
will begin to expire in 2026.

 Utilization
of net operating loss carryforwards and credits may be subject to a substantial annual limitation due to the ownership change limitations
provided by the Internal Revenue Code of 1986, as amended (IRC), and similar state provisions. We have not performed a detailed analysis
to determine whether an ownership change under Section 382 of the IRC has occurred or will occur. We will perform an analysis as soon
as is practicable to determine the extent of limitations, especially in regard to our subsidiaries. It is possible that additional limitations
may arise in future years, even after an analysis is completed, due to future changes in the ownership of our Company.

 We
file federal and state income tax returns in jurisdictions with varying statutes of limitations. With few exceptions, we are no
longer subject to federal or state income tax examinations by tax authorities for tax years prior to 2022 and 2021, respectively. We
believe our income tax filing positions and deductions are more likely than not to be sustained on audit. Therefore, no liabilities
for uncertain tax positions have been recorded.

 As
of the date of this filing, we have not filed our 2023 federal and state income tax returns. We expect to file these documents as soon
as practicable.

 NOTE 16 – DEFINED CONTRIBUTION
PLAN

 On January 1,
2023, we began sponsoring a defined contribution 401(k) plans covering eligible U.S. employees, who may contribute up to 80 % of
their compensation, subject to limitations established by the Internal Revenue Code. We match employee contributions on a
discretionary basis. Expense for our matching contributions was $ 637,365 during 2023.

 NOTE
17 – CONCENTRATION OF CREDIT RISK AND SIGNIFICANT CUSTOMERS

 Cash
Deposits

 Our
financial instruments exposed to concentrations of credit risk consist primarily of cash and cash equivalents. Although we deposit cash
with multiple banks, these deposits, including those held in foreign branches of global banks, may exceed the amount of insurance provided
on such deposits. These deposits may generally be redeemed upon demand and bear minimal risk.

 No
single customer represented over 10 % of our total revenue for the years ended December 31, 2023 and 2022.

 F- 29

 NOTE
18 – GEOGRAPHIC INFORMATION

by geography is based on the customer's billing address and was as follows:

OF REVENUE BY GEOGRAPHY IS BASED ON CUSTOMERS BILLING ADDRESS

 2023

 2022

 U.S.

 $
 33,953,744

 $
 36,559,841

 Chile

 22,570,883

 9,634,082

 All other countries

 534,130

 355,694

 $
 57,058,757

 $
 46,549,617

 No
other international country represented more than 10% of revenue in any period presented.

and equipment, net by geography was as follows:

OF PROPERTY AND EQUIPMENT, NET BY GEOGRAPHIC AREAS

 2023

 2022

 U.S.

 $
 1,052,637

 $
 1,198,057

 Chile

 2,623,881

 3,480,911

 All other countries

 1,527

 Property and equipment net

 $
 3,677,474

 $
 4,680,495

 No
other international country represented more than 10% of property and equipment, net in any period presented.

 NOTE
19 – ACCUMULATED OTHER COMPREHENSIVE LOSS

 The
following table presents AOCI activity in equity:

OF ACCUMULATED OTHER COMPREHENSIVE INCOME

 Foreign Currency Translation Adjustments

 Total AOCI

 Balance as of December 31, 2021

 $
 -

 $
 -

 Other comprehensive income

 Amounts reclassified from AOCI

 -

 -

 Balance as of December 31, 2022

 Other comprehensive income

 Amounts reclassified from AOCI

 -

 -

 Balance as of December 31, 2023

 $
 1,320,177

 $
 1,320,177

 NOTE
20 – SUBSEQUENT EVENTS

 On
January 31, 2024, we entered into a Loan and Security Agreement (the "Loan and Security Agreement") with Aion Financial Technologies,
Inc. ("Aion"), pursuant to which we may borrow up to $ 3,500,000. The amount available for borrowing at any one time is limited
to 80% of our eligible accounts receivable. The Loan and Security Agreement will bear interest at a rate of 19.25 % per annum (based a
360-day year), payable on the first business day of each month following the accrual thereof. The Loan and Security Agreement, together
with accrued and unpaid interest thereon, is due on January 30, 2025 (the "Maturity Date"). Upon providing 30 days written
notice we may terminate the Loan and Security Agreement, subject to an early termination fee of $ 35,000. Upon the occurrence of an "Event
of Default" (as defined in the Loan Security Agreement and including the failure to make required payments when due after specified
grace periods, certain breaches and certain specified insolvency events), Aion would have the right to accelerate payments due, which
from after such acceleration would bear interest at a default rate of 29.25 % per annum. The Loan and Security Agreement is secured by
our assets.

 In
connection with the Loan and Security Agreement, Aion opened a bank account in our name to be used for general business purposes including
receipt of customer payments, disbursements paying normal business expenses, and receipt of any advances from Aion under this agreement.

 We
will use proceeds from the Loan and Security Agreement to repay our business loan entered into November 2023 and for general corporate
purposes, which may include working capital, capital expenditures, and repayment of debt.

 On
February 29, 2024, our board of directors approved a 1-for-15
reverse stock split of our common stock. The record date for the reverse stock split was the close of business on March 7,
2024, with share distribution occurring on March 8, 2024. As a result of the reverse stock split, stockholders received one share of
CISO Global, Inc. common stock, par value $ 0.00001,
for each 15 shares they held as of the record date. All share and per share amounts have been retroactively restated for the effects
of this reverse stock split. Common stock underlying our outstanding warrants, convertible notes, and options have also been
adjusted, and the conversion and exercise prices have also been adjusted.

 On March 22, 2024, we received notification from the Nasdaq Stock Market that we had sufficiently demonstrated compliance
with the bid price requirement in Nasdaq Listing Rule 5550(a)(2) by maintaining a share price in excess of $ 1.00 per share for 10 consecutive
trading days.

 On
March 28, 2024, we and our US subsidiaries entered into a Business Loan and Security Agreement (the "Loan Agreement" with
LendSpark Corporation (the "Lender"), pursuant to which we obtained a loan with a principal amount of $ 2,200,000 (the
"Loan") from the Lender. Pursuant to the Loan Agreement, we paid the Lender a $ 44,000 origination fee. The Loan bears
interest at a rate of 51.73 % per annum and is payable in 52 weekly installments of $ 53,308, commencing on April 5, 2024. We
may prepay the Loan in whole or in part, but partial repayments do not reduce the total interest payable on the Loan, or $ 572,000. If
the Loan is prepaid in full prior to the 60-day anniversary of the date of the Loan Agreement, the total interest is reduced as follows:
(i) if the Loan is repaid within 30 days, the total amount of interest due will be $242,000, and (ii) if the Loan is repaid within 60
days, the total amount of interest due will be $286,000.

 Pursuant
to the Loan Agreement, we granted the Lender a security interest in all if our assets and the assets of our US subsidiaries (the
"Collateral") that is secondary to the security interest held by Aion. Upon the occurrence of an event of default, the Lender
may, among other things, accelerate the Loan and declare all obligations immediate due and payable or take possession of the Collateral.

 In
connection with Loan, we entered into a Fee Agreement (the "Fee Agreement") with the Lender pursuant to which we issued
 100,000 shares of our common stock, par value $ 0.00001 per share (the "Shares") as partial consideration for
the Lender's agreement to enter into the Loan Agreement and extend credit to us. Pursuant to the Fee Agreement, if we repay
the Loan in full by (i) May 1, 2024, the Lender will return 75% of the Shares to us, and (ii) June 1, 2024, the Lender will
return 50% of the Shares to us. The Fee Agreement contains customary representations, warranties, agreements and
obligations of the parties.

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