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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 001-38907

 Sonim
Technologies, Inc.

 (Exact
name of registrant as specified in its charter)

 Delaware

 94-3336783

 (State
 or other jurisdiction of

 incorporation
 or organization)

 (I.R.S.
 Employer

 Identification
 No.)

 4445
Eastgate Mall, Suite 200

 San
Diego, CA 92121

 (Address
of principal executive offices, including zip code)

 Registrant's
telephone number, including area code: (650) 378-8100

 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, par value $0.001 per share

 SONM

 The
 Nasdaq Stock Market LLC

 Securities
registered pursuant to Section 12(g) of the Act: None

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 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, 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 check mark 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 Exchange Act). Yes
 No

 The
aggregate market value of the voting and non-voting common stock held by non-affiliates of the registrant, based on the closing price
of the shares of common stock reported on The Nasdaq Stock Market on June 30, 2023 was approximately $ 23.1 million.

 On
March 20, 2024, there were 43,206,083 shares of the registrant's common stock, par value $0.001, outstanding.

 DOCUMENTS
INCORPORATED BY REFERENCE

 Certain
information required by Part III, Items 10-14 of this Form 10-K will either be (i) included in an amendment to this Annual Report on
Form 10-K, or (ii) incorporated by reference to the Registrant's definitive Proxy Statement for the 2024 Annual Meeting of Stockholders
to be filed with the Securities and Exchange Commission not later than 120 days after the end of the fiscal year covered by this Form
10-K.

 Table
of Contents

 Page

 Cautionary Note About Forward-Looking Statements

 ii

 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.

 Exhibit and Financial Statement Schedules

 Item
 16.

 Form 10-K Summary

 Signatures

 i

 CAUTIONARY
NOTE ABOUT FORWARD-LOOKING STATEMENTS

 This
annual report on Form 10-K contains statements that we believe are "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. Those forward-looking statements are intended to enjoy the protection of the safe harbor
for forward-looking statements provided by that act as well as protections afforded by other federal securities laws. Generally, words
such as "achieve," "aim," "ambitions," "anticipate," "believe," "committed,"
"continue," "could," "designed," "estimate," "expect," "forecast,"
"future," "goals," "grow," "guidance," "intend," "likely," "may,"
"milestone," "objective," "on track," "opportunity," "outlook," "pending,"
"plan," "position," "possible," "potential," "predict," "progress,"
"roadmap," "seek," "should," "strive," "targets," "to be," "upcoming,"
"will," "would," and variations of such words and similar expressions identify forward-looking statements, which
are not historical in nature. The forward-looking statements may appear throughout this report and other documents we file with the Securities
and Exchange Commission (the "SEC"), including without limitation, the following sections:

 (i)

 Note
 12 - Commitments and Contingencies to those Consolidated Financial Statements regarding the possible outcome of, and future effect
 on our financial condition and results of operations of, certain litigations and other proceedings to which we are a party;

 (ii)

 Part
 I, Item 1. "Business," including the statements about our business plans and strategy and anticipated benefits therefrom;

 (iii)

 Part
 I, Item 1A. "Risk Factors," including the statements about ongoing risks and uncertainties and our assumptions in connection
 therewith;

 (iv)

 Part
 II, Item 7. "Management's Discussion and Analysis of Financial Condition and Results of Operations," including
 the statements with regard to the future changes to our business and our expectations regarding our strategy and new lines of products,
 future cash requirements, assessment of our liquidity, the availability, uses, sufficiency, and cost of capital resources, and sources
 of funding, and future products, services, and technologies; and

 (v)

 Part
II, Item 9A. "Controls and Procedures," including the description of limitations on effectiveness of controls and procedures.

 Forward-looking
statements involve risks and uncertainties that could cause actual results to differ materially from those anticipated by these forward-looking
statements. These risks and uncertainties include, but are not limited to, the following:

 the
availability of cash on hand and other sources of liquidity to fund our operations and grow our business;

 our
 ability to compete effectively depends on multiple factors and we may not be able to continue to develop solutions to address user
 needs effectively;

 we
 may not be able to continue to develop solutions to address user needs effectively, including our next-generation products, which
 could materially adversely affect our liquidity and our ability to continue operations;

 a
 small number of customers account for a significant portion of our revenue;

 our
 entry into the data device sector could divert our management team's attention from existing products, cause delays in launching
 our new products, or otherwise have a significant adverse impact on our business, operating results, and financial condition;

 we
 have failed and may continue to fail, to meet the listing standards of Nasdaq, and as a result, our common stock may become delisted,
 which could have a material adverse effect on the trading, liquidity, and market price of our common stock;

 the
 financial and operational projections that we may provide from time to time are subject to inherent risks;

 our
 ability to incorporate emerging technologies into our new consumer products given the lengthy development cycle;

 our
 ability to adapt to shortened customer lead times and tightened inventory controls from our key customers;

 we
 are materially dependent on some customer relationships that are characterized by product award letters and the loss of such relationships
 could harm our business and operating results;

 our
 quarterly results may vary significantly from period to period;

 we
 rely primarily on third-party contract manufacturers and partners;

 if
 our products contain defects or errors, we could incur significant unexpected expenses, experience product returns and lost sales,
 experience product recalls, suffer damage to our brand and reputation, and be subject to product liability or other claims;

 we
 are required to undergo a lengthy customization and certification process for each wireless carrier customer;

 we
 are dependent on the continued services and performance of a concentrated and limited group of senior management and other key personnel;

 we
 face risks related to the impact of various economic, political, environmental, social, and market events beyond our control can
 impact our business and results of operations; and

 other
 risks and uncertainties described in this annual report in the "Risk Factors" section, as such descriptions may be updated
 or amended in any future reports we file with the SEC.

 We
urge investors to consider all of the risks, uncertainties, and other factors disclosed in these filings carefully in evaluating the
forward-looking statements contained in this report. We cannot assure you that the results or developments anticipated by us and reflected
or implied by any forward-looking statement contained in this report will be realized or, even if substantially realized, that those
results or developments will result in the forecasted or expected consequences for us or affect us, our operations or financial performance
as we forecasted or expected. As a result of the matters discussed above and other matters, including changes in facts, assumptions not
being realized, or other factors, the actual results relating to the subject matter of any forward-looking statement in this report may
differ materially from the anticipated results expressed or implied in that forward-looking statement. The forward-looking statements
included in this report are made only as of the date of this report, and we undertake no obligation to update any such statements to
reflect subsequent events or circumstances.

 As
used herein, "Sonim," the "Company," "we," "us," "our," and similar terms
include Sonim Technologies, Inc. and its subsidiaries, unless the context indicates otherwise.

 ii

 PART
I

 Item
1. Business.

 Overview

 We
are a leading U.S.-based provider of rugged solutions, including rugged phones, connected devices, and consumer durable phones. The Company's
growth strategy aims to enhance our leadership position in the rugged market by offering a comprehensive product portfolio that serves
a broader customer base. We plan to penetrate the connected solutions market with high quality and competitively priced products and
enter the consumer durable phone market, where we offer more durable devices to mid and value tiers. Since the second quarter of 2023
through the filing date of this report, we have won thirteen product awards for our expanded portfolio from carriers and channel partners.
 These new products will launch throughout 2024. Additionally, we have a non-core business using the ODM model, where
we design products based on a customer's specifications and find the manufacturer for the product. These products typically have
low margins, high volume, and a short life cycle. In 2022 we began selling tablets under this ODM model and ceased tablet sales in October
2023 as their life cycle ended.

 We
currently have device placements with the three largest wireless carriers in the United States – AT&T, Verizon and T-Mobile
– as well as the three largest wireless carriers in Canada – Bell, Telus and Rogers. While we primarily sell through the
wireless carrier channel, we also sell through distribution channels in North America and Europe. Our tablets were sold unbranded and
were imported by our customer to the U.S., for sale in the U.S. Our devices and accessories connect users with voice, data, workflow,
and lifestyle applications that enhance the user experience while providing an extra level of protection.

 Our
solutions include ultra-rugged mobile phones capable of connecting to both public and private wireless networks, industrial-grade accessories
that meet specific application requirements, and software applications and cloud-based tools that provide management and deployment services
to our customers. We integrate Push-to-Talk ("PTT") capabilities into both the hardware and software of our mobile phones,
including a dedicated hard key that can initiate a PTT call even if the phone is in a sleep-state. The end customers of our solutions
include construction, energy and utility, mining, recreation and hospitality, logistics, manufacturing, public sector and transportation
entities. These customers primarily purchase our devices and accessories through their wireless carriers. The key attributes of our core
solutions, tailored for the needs of our end users, include impact resistance, waterproofing, chemical resistant, and dustproof construction,
extended battery life and extra loud audio, supported by a three-year comprehensive warranty. All of our devices run on the Android operating
system, providing a familiar and intuitive user interface. Our smartphones have access to a library of millions of applications available
through the Google Play Store. We have also implemented dozens of application programming interfaces ("APIs") specific to
our mobile phones and have partnered with third-party application developers to create a purpose-built experience for our end users using
these applications on our mobile phones. This includes working with the leading providers of PTT and mission-critical-PTT, or MCPTT applications
to deliver a seamless instant communications experience.

 We
currently have stocked phone and accessory products with the three largest U.S. wireless carriers: AT&T, T-Mobile and Verizon. This
means that these carriers test and certify our mobile phones on their networks and maintain inventory in their warehouses. They then
sell these products through their enterprise and retail sales teams to end customers, often on a subsidized or financed basis. Our full
product portfolio is also stocked with the three largest Canadian wireless carriers.

 We
enter into master sales arrangements with carriers, including channel partners that contributed approximately 45% of our total revenues
for the year ended December 31, 2023 (under which our partners purchase our solutions for distribution on a purchase order basis). Under
these arrangements, we and the channel partners determine sales channel distribution in connection with pricing (including any discounts
and price protection) and market positioning of each particular mobile phone product. We also offer our channel partners channel marketing
and other promotional incentives, such as sales volume incentives, in exchange for retail price reductions. We may also offer Non-Recurring
Engineering, or NRE, services in the form of third-party design services relating to the design of materials and software licenses used
in the manufacturing of our products. For the years ended December 31, 2023 and 2022, approximately 88% and 83%, respectively, of our
revenues were derived from our top four customers. Similarly, for the years ended December 31, 2023 and 2022, approximately 48% and 42%,
respectively, of our revenue came from our tablet product, which had only one customer. We ceased selling tablets in October 2023 as
their life cycle ended. As we expand our portfolio and increase sales in Europe and Australia in 2024, we expect our revenues to be less
heavily concentrated among our top customers.

 For
the years ended December 31, 2023, and 2022, our revenue was $93.6 million and $69.8 million, respectively. For the same periods, our
net loss was $0.1 million and $14.1 million, respectively. Moreover, net revenues from our top four customers were approximately $82
million and $58 million, for the years ended December 31, 2023, and 2022 respectively.

 Our
Products

 Ruggedized Cell Phones

 Communication,
data collection, productivity and safety among task workers has always been a central requirement in business-critical and mission-critical
environments. Organizations with remote and disparate workers—from police and firefighters to construction, oil rig, logistics
and manufacturing workers—need an extremely durable solution that provides reliable and secure voice, data and workflow applications.
The global market for rugged devices continues to grow and we believe that the use of consumer phones in line-of-business applications
provides an attractive market opportunity. Ruggedized mobile phones are well suited for industrial enterprise and other critical infrastructure
applications due to their durability and functionality in a range of environments. Equipping workers with smarter mobile phones also
helps enable more efficient communication with and between field employees and enhances the information that decision-makers use to deploy
resources within their organizations. The timing of our growth into Europe and other areas outside of North America has accelerated due
to the shutdown of a former competitor, Bullitt Group Ltd. ("Bullitt"), in January 2024. We are expanding our sales force
and increasing our service infrastructure to serve customers that were previously served by Bullitt.

 Connected Solutions Market

 Products include mobile hotspots and fixed wireless
devices that connect to the internet through the cell phone networks. The carriers have created new revenue streams by providing these
devices to their customers to access the internet. These devices replace cable internet access and provide new access to rural areas.
The market for these devices is growing tremendously in North America and in Europe. We created a division to design, develop and sell
connected solutions devices. With competition exiting the carrier space as well as non-competitively priced products in the market, Sonim
believes that this space is a great opportunity for expansion. Sonim has developed feature-rich devices that are competitively priced.
The mobile hotspot segment has millions of LTE devices that customers will be upgrading to 5G as the cost of the devices becomes more
affordable. The fixed wireless access segment is a greenfield opportunity for wireless operators to establish new revenue streams with
their customers. In both areas, Sonim plans to gain market share. We received five product awards for hotspot devices from the U.S. and
Canadian carriers, as well as an Australian carrier. We expect to begin launching new hotspots in the first half of 2024.

 Consumer
Durable Market

 We are testing our premise that consumers
want a more durable low-cost smartphone with the development of a more durable low-cost smartphone. We may launch a new consumer durable
smartphone in late 2024 or 2025.

 Original
Design Manufacturing ("ODM") Business Model

 In
this model, we identify a customer, design a product to meet their needs, outsource the production to a third-party partner, and manage
the production and quality control of the product. We use our expertise and experience to efficiently and quickly develop new products
that are designed based on a customer's specifications. The model allows us to reduce our risk by preventing us from having to
commit resources for the development, production, and financing of the raw materials and inventory. This is not a core business for the
Company, but we will continue to take advantage of opportunities. In 2022 we began selling a tablet under the ODM model. In the fourth
quarter of 2023, the tablet reached the end of its life cycle, and we stopped selling the product. We started selling low-cost white-label
cell phones under this model in December 2023. Revenue from these phones is expected to expand in 2024. Products under the ODM model
have lower costs, lower margins, and shorter life cycles than our other products.

 Key
Features of Our Ruggedized Solutions

 Durability
 and reliability. Our mobile phones can withstand a variety of harsh environments and are supported by our industry-leading
 three-year comprehensive manufacturer's warranty, which includes damage from glass breakage, water, dust, and punctures. Key
 features of our rugged devices include:

 Puncture,
 shock, pressure and drop and impact resistance. Durable rubber and Gorilla Glass construction to protect against damage from
 sharp objects, falls, vigorous movements and compression by heavy weights.

 Waterproof
 and dustproof construction. Reinforced seals and waterproof mesh membranes to prevent potential damage caused by moisture and
 debris.

 Multi-shift
 battery life. Replaceable battery designed to provide sufficient power to last through a dual eight-hour shift in most real-world
 conditions.

 Extra-loud
 audio. Produces high sound quality at high volumes and uses noise cancellation technology for loud background noise environments.

 Glove-friendly
 design. Screens and buttons responsive to touch through gloves and water.

 Operational
 in and resistant to extreme temperatures. Protective exterior prevents damage to our devices' hardware from very cold and
 hot temperatures.

 Chemical
 resistance. Ability to effectively sterilize and sanitize, regardless of potential contaminants.

 Increased
 communication and visibility through an enterprise. Our solutions are used to track locations, update and manage various
 tasks and enable communication with and between task workers. For example, location tracking and data analytics enable fleet optimization,
 help enterprises make asset allocation and deployment decisions and ensure that fleets are at the right place at the right time.
 In addition, our solutions are specifically designed to capture, store and analyze multiple data types for enterprise needs, enabling
 them to make decisions. For example, by leveraging this data, task workers such as first responders can more strategically plan their
 logistics resulting in decreased response times. Finally, by providing a reliable mode of communication between employees, supervisors
 and command centers, those not in the field have crucial insight into the status and performance of task workers in the field. This
 can also result in improved safety for employees that work in high-risk environments.

 Enhanced
 functionality through software and hardware configurations. Our solutions allow end customers and task workers to customize
 our mobile phones using Android-based applications and vertical-specific accessories to address their varying needs. Enterprises
 and agencies can leverage the millions of applications available on the Google Play Store, our dozens of device-specific APIs, and
 our industrial accessories to create a purpose-built solution to meet the specific use cases of their task workers. For example,
 school bus operators can combine our ruggedized phones, an industrial mounting kit, a PTT application that leverages our APIs and
 a location-tracking application to ensure that they have a solution that enables constant communication with dispatchers that is
 compliant with the U.S. Department of Transportation's hands-free driving regulations and that can also automatically alert
 parents of route delays. The ability for enterprises and agencies to customize their solutions allows their task workers to use a
 single device for tasks that would previously require multiple and often more costly devices.

 Ease
 of use. Our devices are designed to look and function similarly to the latest generation of consumer-focused mobile phones
 with additional features for various enterprise-specific purposes, and also run on the Android operating system which has a familiar
 and intuitive interface. They provide familiar characteristics to many single-purpose devices, such as dedicated physical buttons
 for PTT and barcode scanning and offer a simplified user interface, which helps minimize the learning curve for task workers who
 are transitioning from LMR or data capture devices. Furthermore, all of our mobile phones come equipped with our SonimWare software,
 which helps IT administrators more quickly provision and deploy our devices to task workers, reducing the cost and effort associated
 with converting to our solutions.

 Consolidation
 of devices. A large number of devices can lead to excess bulk carried by task workers and can inhibit their mobility in the
 field. These specialized devices can also be expensive and typically require full replacement after end-of-life, which can be a cumbersome
 and costly process. By combining commonly used applications and functionality into one ruggedized device with the option for add-ons,
 enterprises can reduce the need for multiple, single-purpose devices. We believe that replacing outdated single-purpose devices with
 a Sonim device can enhance fleets' mobility and economically streamline equipment updates or replacements.

 As
a result of these key attributes, we believe that our ruggedized, purpose-built mobile solutions can increase the productivity of task
workers and significantly reduce the total cost of ownership for entities deploying our solutions.

 Our
Strategy

 The
three pillars of our go-forward strategy are as follows:

 Enhance
 and expand our leadership position in rugged enterprise and public sector markets. Expand into Europe and other markets. Take advantage
 of sales opportunities due to the shutdown of the Bullitt.

 Approach
 the data device and connected solutions market with feature-rich devices that are affordably priced and leverage the Company's
 high-quality approach to product design and procurement. We have received five product awards for new hotspot devices from U.S. and
 Canadian carriers, as well as an Australian carrier. These hotspots are expected to launch throughout 2024.

 Address
 growing market demand in the consumer market for high quality, lower cost, attractively designed handsets that include key rugged
 features. We will launch a new consumer durable phone in the fourth quarter of 2024 and we will use this as a gage of consumer demand
 for a more durable consumer smartphone.

 Our
strategy includes the following:

 Strategically
 grow the Company. Continue to increase the competencies of the Company to develop new connected solutions and rugged
 products. Expand the sales force in Europe to take advantage of opportunities for connected solutions devices and for rugged
 phones following the shutdown of Bullitt.

 Invest
 in sales channel partnerships and build the Sonim brand to drive sales. Our channel partners are leading global wireless
 carriers, distributors of data devices, communications system integrators and electronics resellers. These channel partners have
 large sales forces who sell our solutions to end customers in our target markets. They enable us to cost-effectively scale our business
 without employing a large direct sales force of our own. Our expansion into the connected solutions markets opens up opportunities
 with additional carrier partners globally.

 Our
Target Markets

 We
believe that our solutions can improve communication reliability, operational efficiency and safety for end customers and task workers
in commercial sectors, public sectors, and for individual retail customers. Our ruggedized mobility solutions target three end markets:
industrial enterprise, public sector, and consumers that demand a more durable product.

 Industrial
Enterprise

 Transportation
and Logistics. Enterprises and fleet workers across supply chain, delivery services, airport workers, and field management rely on
mobile devices to operate safely and efficiently in environments that are often susceptible to inclement weather. For enterprises looking
to improve supply chain functionality, our mobile resource management applications such as location tracking, mileage tracking, and job
dispatch can help businesses monitor operations more efficiently. We believe that a weather-resistant and long-battery ruggedized device,
combined with productivity applications and services with the native camera on our XP10 smartphone—provides reliable communication
options for transportation and logistics workers. In addition, our solutions reduce the number of devices and tools that these task workers
would need to carry in the field by consolidating the functionality of multiple single-purpose devices into one purpose-built mobile
device.

 Construction.
 We offer workers in the construction industry crush-, puncture-, scratch- and impact-resistant devices, which we believe to be crucial
in environments where there is a high risk of such occurrences. Jobsites also value the PTT capabilities that are tightly integrated
into Sonim devices. Additionally, we believe our phones and related accessories help promote worker safety and productivity, with support
for lone-worker safety applications and with features such as extended battery life and extra-loud speakers. For business decision-makers,
we offer devices with consolidated functionality, which enables a total cost of ownership that we believe is significantly lower versus
comparable offerings that enable real-time reporting. This can help eliminate costly delays by capturing verbal, visual, and location
data from job sites more efficiently.

 Manufacturing.
 As market demand and competition in the manufacturing sector require more nimble production lines, equipment for reliable communication
and safety standard compliance are necessary to improve efficiency and keep workers safe. Our devices' PTT functionality and extra-loud
speakerphones are designed to keep lines of communication open and functional in fast-changing and loud environments, while our glove-friendly
touchscreen displays allow workers to have access to real-time data, thus reducing production downtime. Additionally, our devices are
designed to survive blunt force and can be sanitized and sterilized for safe use in food or medical processing facilities. We believe
that these features can enhance the productivity of workers in the manufacturing industry.

 Facilities
Management. Service-based operations in large indoor and outdoor facilities, including recreation parks, require management of mobile
teams. Our mobile phones consolidate radio, guard tour verification, panic button systems and scanners, which otherwise would require
separate and single-purpose equipment. Our devices can improve business operations through functionalities such as automated work order
dispatch and job completion verification tools delivered via proprietary third-party applications integrated with our devices.

 Energy,
Mining, and Utilities. The safety standards for mobile phones used in the energy and utility industry are more stringent due to the
reactive characteristics of the natural resources being procured and serviced, as well as the potentially high-voltage or explosive environments.
We believe we are uniquely positioned to serve these workers because a number of our devices are designed for use in potentially explosive
or hazardous environments (rated Non-Incendive or Intrinsically Safe by either the CSA Group, ATEX or IECEx notified bodies), and their
resistance to various chemicals and extreme temperatures. Reliable communication devices are often mission-critical for workers to stay
safe while performing energy- and utility-related operations.

 Public
Sector

 Public
Safety. In the United States, AT&T's FirstNet network and Verizon's public safety prioritization provide optimized
networks for this sector. Through our partnerships with the major wireless carriers, we believe we are in a strong position to provide
mission-critical solutions to the public safety market as public safety networks mature. Through enhanced communication capabilities, our devices can decrease the response time of first responders and help public safety workers stay safe and connected in hazardous,
isolated or emergency conditions. The durability of our phones, combined with their purpose-built functionality, provides
a lower total cost of ownership compared to similar products, which is highly attractive to city and state decision-makers.

Government. Whether during natural disasters or day-to-day operations, our devices help provide functionality and reliability
that is crucial for federal workers to protect and serve their nation. Our mobile solutions support purpose-built voice communications
and data capture applications that allow federal workers to stay connected and quickly make more informed decisions while in the field.

 Small
Business Users

 As
small businesses grow more reliant upon mobile devices to support all of their daily activities, mobile devices
are now more than ever being placed into situations and environments that are more prone to physical damage including screen
breakage and water damage. We believe that this market is currently underserved with only higher cost devices offering the features
that are needed. Sonim's value proposition will be to offer an overall lower total cost of ownership as a small business will
not need to lose valuable downtime and money repairing or replacing their device as often as other devices in the market. We will be launching a new semi-rugged smartphone that is sleeker and lighter than our ultra-rugged phones, in the
second half of 2024. These phones will be targeted at small business users.

 Home
and Small Business Internet Users

 Mobile
hotspots are used by businesses, government employees and consumers. Having the ability to access the internet in a secure way wherever
the customers go is essential to many users. Whether it is a salesperson visiting their customers, a police officer using their computer
in their patrol car, a student working on a paper or a family going on vacation, the need for reliable internet has become a necessity
in today's world. Mobile hotspots provide the perfect vehicle for taking advantage of these features. We will be launching two new mobile hotspots beginning in the second quarter of 2024 in the U.S., Canada, and Australia.

 Fixed
wireless access provides an economical way for operators to quickly deploy internet to new customers without having to lay costly
new cable or fiber. This service is used by businesses and consumers alike. Historically internet connectivity was effectively a
monopoly business with major fixed wireline operators dividing up the country. Consumers had little choice when it came to options
for internet service. With 5G, wireless operators are using fixed wireless access as a way to add new revenue streams to their
businesses. Additionally, fixed wireline operators are using fixed wireless access as a way to quickly deploy to rural areas that were not served by cable companies.

 Products
and Technology

 Features
of Our Ruggedized Mobile Phones

 Our
mobile phones can withstand a variety of harsh environments and are supported by our industry-leading three-year comprehensive manufacturer's
warranty for our ultra-rugged devices. We developed our devices to meet industry standards for protection from the ingress of water and/or
micro-particles (IEC standard 60529). Our devices are rated a minimum of IP-68, allowing them to be submersed in up to six and a half
feet of water for up to 30 minutes, and our XP10 smartphone has been further tested and certified to withstand sprays of high-pressure
streams (up to 1,450 PSI) of hot (80 C) water (IPx9K). We have additionally designed and manufactured our devices to withstand repeated
drops to concrete across all angles and faces, attaining MIL-STD-810G ratings and, in 2011, earning the Sonim XP3300 the title of World's
Toughest Phone by the Guinness Book of World Records after surviving a fall from 82 feet 11.7 inches to concrete. Engineered with a protective
glass lens that is up to three times thicker than that of other cellular devices in the market and a unique blend of plastic and rubber
used in the housings, our ultra-rugged mobile phones are designed to be resistant to punctures caused by impacts from external objects
up to 2J on the display lens and 4J on the housing. Furthermore, we understand that the jobs of our end users often take them into extreme
environments. As a result, we have designed our devices to operate from -4 F to +131 F, be usable while wearing work gloves (glove-friendly
touch display, large physical buttons), be audible in noisy environments with loud 100+ dB loudspeakers and multiple microphone noise-cancellation
technology, and, for our XP5plus and XP10 phones to last throughout an average day based on ordinary use without needing to be recharged
with large, extended-life batteries. We have also designed, manufactured and certified our devices to be safe for use in potentially
hazardous or explosive environments.

 In
addition, our devices provide a wide range of connectivity options for our end customers (including LTE, 3G, 4G, 5G, GSM, WiFi, NFC,
location tracking and Bluetooth for certain of our devices), and our phones support a wide range of global frequencies allowing them
to be used almost anywhere in the world where there is cellular coverage. Our phones are certified to work on multiple mobile network
operators and come equipped with LTE Band 14 to support FirstNet (built with AT&T). We continue to explore how and when to best support
the latest technologies, including 5G, and we plan to incorporate them into our product roadmap when our end market segments require
such functionality, and the technology has reached a reasonable level of maturity.

 Our
Devices

 Mobile
Phone Products

 Sonim
 XP10. The Sonim XP10 is an Android-based 5G smartphone.

 Sonim
 XP5plus. The Sonim XP5plus is a purpose-built 4G feature phone designed for task workers who have a "no frills" attitude
 about their communications tool.

 Sonim
 XP3plus. The Sonim XP3plus is a 4G feature phone in a clamshell form factor that offers our customers a cost-effective voice and/or
 PTT solution without distracting end users from doing their jobs with things like an application store or email.

 Sonim XP Pro. The Sonim XP Pro will be launched in the second half of 2024 with three North American carriers. The
XP Pro is an Android-based 5G smartphone that is sleeker and lighter than our XP10 and will be marketed to small businesses that need
a phone that is more durable than a consumer phone.

 Connected Solutions Products

 Sonim Mid-Range Mobile Hotspot. The Mid-Range Mobile Hotspot is expected to be launched beginning in the second quarter of 2024 with multiple carriers. It allows users to connect to the internet wherever they can access the 5G network.

 Sonim Premium Mobile Hotspot. The Sonim Premium Mobile Hotspot is expected to be launched in the second half of 2024.

 Accessories

 Our
portfolio of industrial-grade accessories extends beyond the traditional consumer cellular ecosystem of wall chargers and cases. We work
with a number of accessory manufacturers and design partners to deliver innovative purpose-built accessories that enhance the functionality
and usability of our devices.

 SonimWare
Software

 In
addition to the ecosystem of Android developers and their applications, which are supported on our devices, we provide a suite of applications
and tools that help customers manage, deploy and support their Sonim devices. The capabilities of these software applications differentiate
us from many rugged vendors that only focus on hardware. Current capabilities include:

 Sonim
 Setup Wizard allows provisioning teams to rapidly customize and deploy large number of devices with less manual work and fewer errors.

 Sonim
 SafeGuard lets user administrators block usage of selected apps and features, ensuring only those critical to job-related functions
 and cost requirements are used. We are looking to expand the functionality of SafeGuard to extend to the consumer market for key
 features such as parental controls.

 Sonim
 Kiosk Mode lets user administrators configure devices with the minimum required functionality, a critical customer need in hazardous
 environments or anywhere where user safety is paramount.

 Scout
 App Updater lets administrators control when and where updates are sent to users' phones.

 Sonim
 SOS provides emergency alert capabilities for users of Sonim devices to help ensure worker and job-site safety. Additionally, given
 recent events that highlight school safety concerns, we are working on implementing this solution in our consumer handset line as
 well as our data solutions products.

 Sales
and Marketing

 As
of December 31, 2023, our sales and marketing team consisted of 19 professionals located in the United States, Canada and Europe. We
sell our products directly to wireless carriers, through distributors and resellers and directly to end customers. Our marketing efforts
consist of product marketing, channel partner/carrier marketing and corporate marketing. Product marketing focuses on ensuring that carrier
requirements related to product specifications are in-line with our brand requirements. Channel partner marketing focuses on go-to-market
strategy as well as developing supplemental sales tools, carrier and non-carrier marketing campaigns, industry trade show materials and
brand awareness. Corporate marketing consists of public relations, social and digital marketing and lead generation operations.

 Customers

 While
we are actively committed to expanding our customer base on various levels, our sales model for the phone business mainly focuses on
sales through our channel partners. As a result, a small number of customers account for a large percentage of our net revenue. For the
fiscal year ended December 31, 2023, the purchaser of our tablets (our largest customer) and the three largest U.S. wireless carriers
(our channel partners) accounted for approximately 48% and 35% of our net revenue, respectively, collectively constituted approximately
83% of our net revenue. Although the net revenue from our largest customer (and consequently from tablet sales) ended in October 2023,
as we generate more net revenue from other customers, we expect that net revenue from a relatively small group of customers will continue
to account for a significant portion of our net revenue in the near term. For further discussion of our revenue trends and risks related
to our customers and contractual relationships, please refer to "Part II. Item 7. Management's Discussion and Analysis of
Financial Condition and Results of Operations" and "Part I. Item 1A. Risk Factors" of this Form 10-K.

 Manufacturing

 We
have outsourced the manufacturing and the final assembly to third-party ODM partners for our phones and data devices.

 Competition

 We
operate in a highly competitive environment serving end customers in the industrial enterprise and public sector markets. These markets
are highly fragmented, evolving and increasingly competitive. Competition in our industry is intense and has been characterized by rapidly
changing technologies, evolving industry standards, significant barriers to entry in the form of carrier certification requirements,
frequent new product introductions, annual operating system changes and rapid changes in end user requirements.

 Non-rugged
mobile device manufacturers have not historically created devices specifically to compete in the industrial enterprise and public sector
markets. These manufacturers typically focus on a different consumer audience and the requirements to manufacture ruggedized phones differ
significantly from their core products. Nevertheless, we face competition from manufacturers of non-rugged mobile phones such as Apple
Inc. and Samsung Electronics Co. Ltd, or Samsung, to the extent that end users decide to purchase traditional devices and add a rugged
case for use in environments that we believe are better suited for purpose built ruggedized mobile phones. We also face competition from
manufacturers of rugged mobile phones such as Samsung, and Kyocera Corporation as well as from large system integrators and manufacturers
of private and public wireless network equipment and devices. A large competitor in the rugged phone space, Bullitt Group Ltd., ceased
operations in January 2024, which has created an opportunity for us, particularly in Europe.

 We
believe the principal competitive factors affecting the market for our products are the products' performance, features (including
security features), quality, design innovation, reliability, price, customer service, reputation in the industry, brand loyalty and a
strong third-party software and accessories ecosystem. We believe that our strongest competitive advantages are our products' durability
and reputation in the industry, as well as the push to talk capabilities not available in all competitive devices. Additionally, we believe
our XP10 rugged smartphone is one of the most rugged smartphones made anywhere in the world and it is consequently able to be fully sterilized
and cleaned. In order to compete, we will be required to continue to respond promptly and effectively to the challenges of technological
changes and our competitors' innovations.

 Intellectual

 Our
competitiveness and future success are dependent on our ability to protect our own proprietary technology and to access other important
intellectual property. We protect our freedom to operate in the markets and mitigate intellectual property costs by proactively securing
licenses with key patent holders, filing our own patents, trademarks, and copyrights and participating in defensive patent pools. As
of December 31, 2023, we held 17 utility and design patents in the United States and 11 outside the United States and have filed 1 utility
and design patent applications in the United States. We also have contractual rights to standard essential patents for 2G, 3G, 4G, and
5G wireless technologies, some of which require significant royalty payments. As of December 31, 2023, we held 16 trademarks in the United
States and 17 trademarks outside the United States and have filed 9 trademark applications in the United States and 11 outside the United
States. We opportunistically negotiate licenses with other patent holders where appropriate for our technology.

 Our
products are built to conform to wireless standards which are covered by numerous essential patents held by third parties. Our wireless
carriers require us to provide patent indemnification for the products we sell to them, and in turn, we secure intellectual property
indemnification from our suppliers.

 We
do not believe that our products infringe on the proprietary rights of any third parties. There can be no assurance, however, that third
parties will not claim such infringement by us or our channel partners and end customers with respect to current or future products.
In the past, we have had third parties assert exclusive patent or other intellectual property rights to technologies that are important
to our business. Any such claims, with or without merit, could be time-consuming, result in costly litigation, cause product shipment
delays or require us to enter into a royalty or licensing agreement, any of which could delay the development and commercialization of
our products.

 Our
smartphone devices use the standard Android operating system and our feature phones use an operating system based on the Android Open
Source Project. We additionally integrate third-party licensed software on commercially reasonable terms. Several Android-based apps
and extension enablers of Android are developed internally by our employees.

 Legislation
and Regulation

 Wireless
communication devices use radio spectrum, which is regulated by government agencies throughout the world. In the United States, use of
spectrum is regulated by the Federal Communications Commission, or FCC, and the National Telecommunications and Information Administration,
or NTIA, for non-federal government entities and federal government entities, respectively. The FCC and NTIA allocate spectrum for various
uses, including commercial wireless services and public safety services, and regulate the use of that spectrum and the devices, such
as our products, that operate on that spectrum. The FCC and NTIA also adopt requirements that affect wireless equipment, such as limits
on radio emissions and rules requiring that handsets have specified capabilities, such as providing location information to 911 operators.
The FCC also regulates the testing and certification for the import and/or sale of certain wireless devices.

 Other
countries also have regulatory bodies that define and implement the rules for using radio spectrum, pursuant to their respective national
laws and international coordination under the International Telecommunications Union. Our ability to manufacture and sell products in
other countries could be affected by such rules. In addition, any significant variations between the rules in the United States and rules
in other countries, including differences in available spectrum bands for wireless communication, could increase the costs of designing
and manufacturing our products.

and Development

 We
allocate significant resources and funds to developing robust and innovative solutions for the end users of our products and ensuring
that these solutions meet their exacting requirements for functionality and reliability. Our research and development initiatives are
led by our internal teams and are supported by third-party original design manufacturers as needed. Our product management team and our
sales and marketing team spend time interacting with a combination of end users and IT administrators in our target markets, wireless
carriers and application and accessory ecosystem partners to better understand the market requirements for our solutions. Once defined,
our engineering organization develops and tests the solution against these requirements and works to achieve technical certification
and approval from the wireless carriers which allows the solutions to be sold to our end users.

 Employees

 We
have 67 full time employees and 25 contractors as of December 31, 2023.

 None
of our employees are represented by a labor union or covered by a collective bargaining agreement. We have not experienced any work stoppages,
and we consider our relations with our employees to be good.

 Corporate
Information

 Sonim
Technologies, Inc. was incorporated in the state of Delaware on August 5, 1999, and is headquartered in San Diego, California.

 Available
Information

 Our
Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and amendments to reports filed pursuant to
Sections 13(a) and 15(d) of the Securities Exchange Act of 1934, as amended, or the Exchange Act, are filed with the Securities Exchange
Commission, or the SEC. The SEC's website is www.sec.gov. Our website provides a link to our SEC filings, which are available free
of charge on the same day such filings are made. The specific location on the website where these reports can be found is ir.sonimtech.com.
The information contained on the websites referenced in this Form 10-K is not incorporated by reference into this filing. Further, the
Company's references to website URLs are intended to be inactive textual references only.

 Item
1A. Risk Factors.

 Investing
in our securities involves a great deal of risk. Careful consideration should be made of the following factors as well as other information
included in this Annual Report on Form 10-K before deciding to purchase our securities. There are many risks that affect our business
and results of operations, some of which are beyond our control. If any of the following risks actually occur, our business, financial
condition or operating results could be significantly harmed. This could cause the trading price of our common stock to decline, and
you may lose all or part of your investment. Additional risks that we do not yet know of or that we currently think are immaterial may
also affect our business and results of operations.

 SUMMARY
OF RISK FACTORS

 The
following is a summary of some of the risks and uncertainties as of the date of the filing of this Annual Report on Form 10-K that could
materially adversely affect our business, financial condition, and results of operations. You should read this summary together with
the more detailed description of each risk factor contained below in the section titled "Risk Factors."

 Risks
Related to Our Business and Industry

 Our
 ability to compete effectively depends on multiple factors and we may not be able to continue to develop solutions to address user
 needs effectively;

 We
 face strong competitors with greater resources and more extensive experience in the industry;

 A
 small number of customers account for a significant portion of our revenue;

 We
 are materially dependent on some customer relationships that are characterized by non-binding product award letters and the loss
 of such relationships could harm our business and operating results;

 We
 rely primarily on third-party contract manufacturers and partners;

 We
 continue to restructure and transform our business;

 Our
 entry into the data device sector may divert financial and managerial resources;

 Lengthy
 customization and certification process for each wireless carrier customer;

 We
 are dependent on the continued services and performance of our management and key personnel;

 Our
 products may contain defects or errors;

 Risks
Related to Our Financial Condition

 We may not generate sufficient liquidity
to operate our business and maintain its growth;

 Our
 liquidity has been adversely impacted by our ongoing net losses;

 We
 have not been profitable in recent years and may not achieve or maintain profitability;

 Risks
Related to Information Technology and Intellectual Property

 Without
 successful protection of our intellectual property, our competitive position may be harmed;

 The
 occurrence of security breaches, improper access to or disclosure of our data or customer data, and other cyber incidents can inflict
 monetary and reputational damages;

 Others
 may claim that we infringe on their intellectual property rights;

 Risks
Related to Legal and Regulatory Matters

 in laws and regulations concerning the use of telecommunication bandwidth could increase our costs and adversely impact our business;

 in U.S. trade policy including tariffs can adversely impact our business;

 Risks
Related to Ownership of Our Common Stock

 We
 are not in compliance with the listing standards of the Nasdaq Stock Market and as a result, our common stock may become delisted;

 Sales
 of our common stock under the currently effective registration statement or the perception of such sales can result in a decline
 in the price of our common stock;

 Our
 quarterly results may vary significantly from period to period;

 projections we communicate to the markets from time to time may be inaccurate; and

Risk Factors

 We
 face risks related to the impact of various economic, political, environmental, social, and market events beyond our control can
 impact our business and results of operations.

 Risks
Related to Our Business and Industry

 To
remain competitive and stimulate consumer and business demand, we must successfully manage the introductions of new products and product
lines and the transition and enhancement of existing products.

 We
operate in a highly competitive, quickly changing environment characterized by evolving industry standards, frequent new product and
service introductions, evolving distribution channels, increasing demand for customized product and software solutions, rapid competitive
developments; and changing customer demands. Technological advancements could render our products obsolete, which typically erodes prices
and causes products to become unmarketable.

 Our
success will depend on our ability to respond to changing technologies and customer requirements, effectively stimulate customer and
business demands for new and upgraded products, and our ability to develop and introduce new and enhanced products in a cost-effective
and timely manner. For example, our XP3plus and XP5plus products are compatible with fourth-generation, or 4G, technology, but emerging
fifth-generation wireless, or 5G, technology will require network infrastructure upgrades, which could require us to update and migrate
all of our systems from 4G to 5G.

 As
a result, we are currently prioritizing spending on research and development of our consumer durable mobile phones and other data devices.
However, the research and development necessary to launch our new products will require us to incur additional costs and our liquidity
continues to be adversely impacted by our ongoing net losses. There can be no assurance that we will have sufficient resources to complete
the development of our new products and bring them to market. Even if we are able to introduce our new ruggedized mobile phones to the
market, there can be no assurance that these new product introductions will lead to any sales or increase in revenue. If we fail to develop
new products on a timely and cost-effective basis, or if our new products fail to achieve market acceptance, our business, operations,
financial condition, and liquidity would be further materially adversely affected and we may be required to delay, reduce or cease our
operations and we may be required to seek bankruptcy protection. In addition, we introduced and plan to continue introducing new product
lines in new markets expanding our business to data device markets, which may require management of new suppliers, potential new customers,
and new business models to keep new products competitive.

 The
development of new or enhanced products is a complex and uncertain process requiring the accurate anticipation of technological and market
trends. We may experience design, manufacturing, marketing, and other difficulties that could delay or prevent the development, introduction,
or marketing of our new products and enhancements. If we experience delays with new products, if our expectations regarding market demand
and direction are incorrect, if sales of our existing products begin to decline more rapidly, or if the rate of decline continues to
exceed the rate of growth of our next-generation products, it will materially and adversely affect our business, results of operations
and financial condition, and may require us to significantly reduce or even eliminate certain research and development programs.

 We
participate in a competitive industry, which may become more competitive. Competitors with greater resources and significant experience
in high-volume product manufacturing may be able to respond more quickly and cost-effectively than we can to new or emerging technologies
and changes in customer requirements.

 We
face significant competition in developing and selling our solutions. Our primary competitors in the non-rugged mobile device market
include Apple Inc. and Samsung Electronics Co. Ltd. Our primary competitor in the rugged mobile device market is Kyocera Corporation.
 We also face competition from large system integrators and manufacturers of private and public wireless network equipment
and devices. Competitors in this space include Harris Corporation, JVC KENWOOD Corporation, Motorola Solutions, Inc., MSI, and Tait International
Limited.

 We
cannot assure we will be able to compete successfully against current or future competitors. Increased competition in mobile computing
platforms, or related accessories and software developments may result in price reductions, lower gross profit margins, and loss of market
share, and could require increased spending on research and development, sales and marketing, and customer support. Some competitors
may make strategic acquisitions or establish cooperative relationships with suppliers or companies that produce complementary products,
which may create additional pressures on our competitive position in the marketplace.

 Most
of our competitors have longer operating histories, greater name recognition, larger customer bases, and significantly greater financial,
technical, sales, marketing, and other resources and experience than we do. In addition, because of the higher volume of components that
many of our competitors purchase from their suppliers, they are able to keep their supply costs relatively low and, as a result, may
be able to recognize higher margins on their product sales than we do. Many of our competitors may also have existing relationships with
the channel partners who we use to sell our products, or with our potential customers. This competition may result in reduced prices,
reduced margins, and longer sales cycles for our products. Our competitors may also be able to quickly and cost-effectively respond to
new or emerging technologies and changes in customer requirements. The combination of brand strength, extensive distribution channels,
and financial resources of the larger vendors could cause us to lose market share and could reduce our margins on our products, especially
if any of our larger competitors moved into the market for ultra-rugged mobile phones and accessories, as those competitors would enjoy
relatively low barriers. If any of our larger competitors were to commit greater technical, sales, marketing, and other resources to
our markets, our ability to compete would be adversely impacted. If we are unable to successfully compete with our competitors, our sales
will suffer and as a result, our financial condition will be adversely impacted.

 We
are dependent on the continued services and performance of a concentrated and limited group of senior management and other key personnel,
the loss of any of whom could adversely impact our business.

 Our
future success depends in large part on the continued contributions of a concentrated and limited group of senior management and other
key personnel. Beginning in 2021, we outsourced substantially all of our software development and manufacturing work to third parties
and, as part of these outsourcings, we transferred or eliminated a significant number of employees. As of December 31, 2023, our worldwide
employee headcount was 67 employees.

 Due
to the small size of our Company and our limited number of employees, each member of our executives, managers and other key personnel
serves a critical role to our success. If we are unable to retain sufficiently experienced and capable employees, including those who
can help us increase revenues generated from our end market segments, our business and financial results may suffer. The loss of the
services of any additional executives, managers or other key personnel could impede the achievement of our strategic objectives, seriously
harm our ability to successfully implement our business strategy and adversely impact our operating results. In addition, if additional
executives, managers or other key personnel resign, retire or are terminated, or their service is otherwise interrupted, including due
to global pandemics, we may not be able to replace them in a timely manner and we could experience significant declines in productivity
and/or errors due to insufficient staffing or managerial oversight. Moreover, experienced and capable employees in the technology industry
remain in high demand, and there is continual competition for their talents. Given our size, we may be at a disadvantage, relative to
our larger competitors, in the competition for these personnel.

 We
currently generate significant net revenue from a small number of customers, and our channel partners. The loss of any of these significant
relationships, decline in net revenue from these customers, or their failure to remit contractual payments timely will adversely affect
our business, results of operations, financial condition, and future prospects.

 A
small number of customers account for a large percentage of our net revenue. For the fiscal year ended December 31, 2023, the purchaser
of our tablets (our then-largest customer) and the three largest U.S. wireless carriers (our channel partners) accounted for approximately
48% and 35% of our net revenue, respectively, collectively constituted approximately 83% of our net revenue. Because we stopped selling
our tablet data devices in the fourth quarter of 2023, we expect to generate more revenue from other customers. Nevertheless, net revenue
from a relatively small group of customers will continue to account for a significant portion of our net revenue in the near term.

 Any
delay in payments from our customers for any reason also severely impacts our financial condition, liquidity, and results of operation,
including the appropriate allocation of commitments and contingencies. We experienced such payment delays in the past.

 We
currently rely on the three largest U.S. wireless carriers, and two of the three largest Canadian wireless carriers, for the majority
of our revenues. We expect our revenues from mobile devices to remain heavily concentrated among these top wireless carriers, and we
will be substantially dependent on these wireless carriers continuing to purchase and promote our products to their sales channels as
well as customer demand for devices and services from these wireless carriers (factors over which we do not have any control). The communications
industry is also experiencing rapid consolidation and realignment. As a result, our customers may consolidate or align with other entities
in a manner that may delay orders or result in reduced demand compared to historical rates for our products.

 The
loss of one or more of these significant customers, or reduced demand or purchases from these significant customers, would result in
significant harm to our revenues and results of operations, and our growth could be limited. In addition, any publicity associated with
the loss of any of our carrier customers may adversely affect our reputation and could make it more difficult to attract and retain other
customers.

 We
rely on our channel partners to generate a substantial amount of our revenue. If we are unable to maintain successful relationships with
channel partners, our business, operating results, and financial condition could be adversely affected.

 In
the years ended December 31, 2023 and 2022, approximately 35% and 41% of our revenues, respectively, were derived from the three largest
U.S. wireless carriers, our channel partners. Our channel partners are primarily wireless carriers who sell our phones through their
sales channels. To the extent our channel partners are unsuccessful in selling or do not promote our products, or we are unable to obtain
and retain a sufficient number of high-quality channel partners, our business and operating results could be significantly harmed.

 We
enter into master sales arrangements with the majority of our channel partners. Under the master sales arrangements, our partners purchase
our products for distribution on a purchase order basis. While these arrangements are typically long-term, they generally do not contain
any firm purchase volume commitments. As a result, our channel partners are not contractually obligated to purchase from us any minimum
quantity of products. We are generally required to satisfy any and all purchase orders delivered to us within specified delivery windows,
with limited exceptions (such as orders significantly in excess of forecasts). If we are unable to efficiently manage our supply and
satisfy purchase orders on a timely basis to our channel partners, we may be in breach of our sales arrangements and lose potential sales.
Our sales arrangements also generally include technical performance standards for our mobile phones and accessories sold, which vary
by channel partner. If a technical issue with any of our covered products exceeds certain preset failure thresholds for the relevant
performance standard or standards, the channel partner typically has the right to cease selling the product, cancel open purchase orders,
and levy certain monetary penalties. If our products suffer technical issues or failures following sales to our channel partners, we
may be subject to significant monetary impact and our channel partners may cease making purchase orders, which would significantly harm
our business and results of operations. In addition, our channel partners retain sole discretion in which of their stocked products to
offer their customers. While we may offer limited customer incentives, we generally have limited to no control over which products our
channel partners decide to offer or promote, which directly impacts the number of products that our partners will purchase from us.

 Our
channel partners may be unsuccessful in marketing, selling and supporting our solutions. They may also market, sell and support solutions
that are competitive with ours, and may devote more resources to the marketing, sales, and support of such products. They may have incentives
to promote our competitors' products in lieu of our products, particularly for competitors who do a large volume of business with
the channel partner. For example, during the summer of 2019, we expected, based on input from our US wireless carrier channel partners,
for such channel partners to subsidize our new products following launch, to place new releases in retail locations, and to sign up push-to-talk
customers to our new generation phones. In each of these cases, there were significant delays and changes in the rollout of these efforts,
which negatively impacted demand for our products and thus our profitability. In the event there is not sufficient demand for our products,
our channel partners may stop selling our products completely. While we employ a small direct sales force, our channel partners have
significantly larger sales teams who are not contractually obligated to promote any of our devices and often have multiple competing
devices in stock to offer their customers. In addition, downstream sales by our channel partners often succeed due to attractive device
prices and monthly rate plans, which we do not control. In certain cases, we may promote our own devices through customer incentives,
typically in exchange for retail price reductions or contributions of funds for marketing purposes; however, there can be no assurance
that any such incentives would contribute to increased purchases of our products. Further, given the impact of attractive pricing on
ultimate sales, we generally must offer increased promotional funding or price reductions for our more expensive products. This promotional
funding or price reductions operate to reduce our margins and significantly impact our profitability.

 New
sales channel partners, as well as sales of new products being sold by existing channel partners, may take several months or more to
achieve significant sales. Our channel partner sales structure could subject us to lawsuits, potential liability, and reputational harm
if, for example, any of our channel partners misrepresents the functionality of our products or services to their customers or violates
laws or our corporate policies. Additionally, some of our master agreements with our wireless carrier customers contain most "favored
nation" clauses. These clauses typically provide that if we enter into an agreement with another wireless carrier or customer on
more favorable terms, we must offer some of those terms to our existing wireless carrier customers. These provisions may obligate us
to provide different, more favorable, terms to our existing wireless carrier customers, which could, if applied, result in lower revenues
or otherwise adversely impact our business, financial condition, and results of operations.

 If
we fail to effectively manage our existing or future sales channel partners, our channel partners fail to promote our products effectively,
we are unable to meet our obligations under our sales arrangements or enter into future agreements with wireless carrier customers that
have terms that are more favorable to the customer, our business and results of operations would be harmed.

 We
continue to transform our business. The assumptions underlying these efforts may prove to be inaccurate, or we may fail to achieve the
expected benefits from these efforts, and we may have to restructure or transform our business again in the future.

 In
order to be successful, we must have a competitive business model that brings innovative products and services to market in a timely
way. We continue to restructure and transform our business in response to changes in industry and market conditions and to focus on business
simplification, quality improvement, reduced direct and indirect costs, and new revenue growth. We must manage the potentially higher
growth areas of our business, which entail higher operational and financial risks, as well as the non-core areas, in order for us to
achieve improved results. Our assumptions underlying these actions may not be correct, we may be unable to successfully execute these
plans, and even if successfully executed, our actions may not be effective or may not lead to the anticipated benefits. As a result,
we may determine that further restructuring or business transformation will be needed, which could result in the need to record further
special charges such as costs associated with workforce reductions, and we may be unable to maintain or improve our market competitiveness
or profitability.

 In
connection with the transformation of our business, we have made and will continue to make, judgments as to whether we should outsource
the development and manufacturing of our products. If any of these providers experience (i) difficulties in obtaining sufficient supplies
of components, (ii) component prices significantly exceeding anticipated costs, (iii) an interruption in their operations, or (iv) otherwise
suffers capacity constraints, we could experience a delay in production and shipping of these products, which would have a negative impact
on our revenue. Should there be any disruption in services due to natural disasters, economic or political difficulties, transportation
restrictions, acts of terror, quarantines, or other restrictions associated with infectious diseases, or other similar events, or any
other reason, such disruption could have a material adverse effect on our business. Operating in the international outsourcing environment
exposes us to certain inherent risks, including unexpected changes in regulatory requirements and tariffs, and potentially adverse tax
consequences, which could materially affect our results of operations. If these providers are unable to achieve greater operational efficiencies,
delivery schedules for new product development and current product delivery could be negatively impacted. Currently, we have no second
source of manufacturing for a portion of our products. In addition, switching from one provider to another is an expensive, difficult,
and time-consuming process, with serious risks to our ability to successfully transfer our development and/or manufacturing operations.
If overall demand for our devices increases in the future, we will need to expand our manufacturing capacity in a cost-efficient manner.
Our operations, and consequently our revenues and profitability, could be materially adversely affected if we are forced to switch from
any of our providers to another provider due to any of a number of factors, including financial difficulties faced by the manufacturer,
disagreements in pricing negotiations between us and the manufacturer or organizational changes in the manufacturer.

 Further,
we have made and will continue to make judgments as to whether we should further reduce, relocate, or otherwise change our workforce.
We have outsourced substantially all of our manufacturing functions, software development, and quality control functions to third parties,
transferring the employees who previously performed this work. These reductions may have resulted in the loss of institutional knowledge
and expertise and the reallocation and combination of certain roles and responsibilities across the organization, all of which could
adversely affect our operations. These restructuring and additional measures we might take to reduce costs could divert management attention,
yield attrition beyond our intended reduction in force, reduce employee morale, or cause us to delay, limit, reduce, or eliminate certain
product development plans, each of which could have an adverse impact on our business, operating results and financial condition. Furthermore,
our workforce efforts may impair our ability to achieve our current or future business objectives.

 Our
entry into the data device sector could divert our management team's attention from existing products, cause delays in launching
our new products, or otherwise have a significant adverse impact on our business, operating results, and financial condition.

 In
August of 2023, as part of our expansion efforts, we announced an expansion of our product portfolio and introduced a new Connected Solutions
division which is set to begin launching products in 2024 in the U.S., Canada, Europe, and Asia/Pacific. Connected Solutions will primarily
consist of mobile hotspots, fixed wireless, and USB dongle devices. The success of this new division depends in large part on our team's
ability to correctly identify and address the market opportunity, to execute our plans to develop, manufacture, market, and sell our
new family of data devices.

 Our
entry into these next-generation devices, and in the overall data device sector other than smartphones, may divert our management team's
attention from existing product development and may cause our inability to achieve the planned product portfolio expansion which could
negatively impact our business, financial condition, and results of operations.

 We
are materially dependent on the adoption of our solutions by both the industrial enterprise and public sector markets, and if end customers
in those markets do not purchase our solutions, our revenues will be adversely impacted, and we may not be able to expand into other
markets.

 Our
revenues have historically been in the industrial enterprise market, and we are materially dependent on the adoption of our solutions
by both the industrial enterprise and public sector markets. End customers in the public sector market may remain, for reasons outside
our control, tied to solutions or other competitive alternatives to our phones. Sales of our products to these buyers may also be delayed
or limited by these competitive conditions. If our products are not widely accepted by buyers in those markets, we may not be able to
expand sales of our products into new markets, and our business, results of operations, and financial condition may be adversely impacted.

 We
rely primarily on third-party contract manufacturers and partners. If these relationships are disrupted and we are unable to obtain substitute
manufacturers or partners, on favorable terms or at all, our business, operating results, and financial condition may be harmed.

 We
have outsourced our software development, third-party contract manufacturing, and product assembly operations to third parties located
in India and China.

 Our
contract manufacturers now produce all of our products in facilities located in Asia. All manufacturing of our products is performed
in accordance with detailed specifications and product designs furnished or approved by us and is subject to rigorous quality control
standards. We periodically review our product manufacturing operations and consider changes we believe may be necessary or appropriate.
Although we intend to closely manage the transition process when manufacturing changes, we could experience disruption to our operations
during any such transition. Other significant risks include limited control over assembly and testing capacity, delivery schedules, quality
assurance, manufacturing yields, production costs, tariffs, and uncertainty over political unrest. Any such disruption could negatively
affect our reputation and our operating results.

 In
addition, we rely on third parties to provide certain services to us, or to our customers, including software development, hosting services,
and providers of other cloud-based services. If these third-party providers do not perform as expected, our customers may be adversely
affected, resulting in potential liability and negative exposure for us. If it is necessary to migrate these services to other providers
due to poor performance, cyber breaches or other security considerations, or other financial or operational factors, it could result
in service disruptions to our customers and significant time and expense to us, any of which could adversely affect our business, operating
results, and financial condition.

 Migrating
our design methodology to third-party contract manufacturers or partners could involve increased costs, resources, and development time,
and could expose us to further risk of losing control over our intellectual property and the quality of our products.

 If
our products contain defects or errors, we could incur significant unexpected expenses, experience product returns, and lost sales, experience
product recalls, suffer damage to our brand and reputation, and be subject to product liability or other claims.

 We
produce highly complex products that incorporate leading-edge technology, including both hardware and software. The industry standards
upon which many of our products are based are also complex, experience changes over time, and may be interpreted in different manners.
Software often contains defects or programming flaws that can unexpectedly interfere with expected operations. In addition, our products
are complex and are designed to be deployed in large quantities across complex and varying networks. Because of the nature of these products,
they can only be fully tested when completely deployed in large networks with high amounts of traffic, and there is no assurance that
our pre-shipment testing programs will be adequate to detect all defects. As a result, our customers may discover errors or defects in
our hardware or software, or our products may not operate as expected. If we are unable to cure a product defect, we could experience
damage to our reputation, reduced customer satisfaction, loss of existing customers and failure to attract new customers, failure to
achieve market acceptance, reduced sales opportunities, loss of revenue and market share, increased service and warranty costs, diversion
of development resources, legal actions by our customers, and increased insurance costs. Defects, integration issues, or other performance
problems in our products could also result in damages to our customers, financial or otherwise. Our customers could seek damages for
related losses from us, which could seriously harm our business, operations, financial condition, and liquidity. A product liability
claim brought against us, even if unsuccessful, would likely be time-consuming and costly. The occurrence of any of these problems would
seriously harm our business, operations, financial condition, and liquidity.

 Further,
errors, defects, or bugs in our solutions could be exploited by hackers or could otherwise result in an actual or perceived breach of
our information systems. Alleviating any of these problems could require significant expense and could cause interruptions, delays, or
cessation of our product licensing, which would reduce demand for our products and result in a loss of sales, delay in market acceptance,
and injure our reputation and could adversely impact our business, results of operations and financial condition.

 If
our business does not grow as we expect, or if we fail to manage our growth effectively, our operating results and business will suffer.

 Our
ability to successfully grow our business depends on a number of factors including our ability to:

 accelerate
 the adoption of our solutions by new end customers;

 expand into new geographical areas and into new vertical markets;

 develop
 and deliver new products and services;

 increase
 awareness of the benefits that our solutions offer; and

 become
 more cost-effective and scalable by utilizing contract manufacturing.

 As
usage of our solutions grows, we will need to continue to make investments to develop and implement new or updated solutions, technologies,
security features, and cloud-based infrastructure operations. In addition, we will need to appropriately scale our internal business
systems and our services organization, including the suppliers of our detection equipment and customer support services, to serve our
growing customer base. Any failure of, or delay in, these efforts could impair the performance of our solutions and reduce customer satisfaction.
Further, our growth could increase quickly and place a strain on our managerial, operational, financial, and other resources, and our
future operating results depend to a large extent on our ability to successfully manage our anticipated expansion and growth. To manage
our growth successfully, we will need to continue to invest in sales and marketing, research and development, general and administrative
functions, and other areas. We are likely to recognize the costs associated with these investments earlier than receiving some of the
anticipated benefits, and the return on these investments may be lower, or may develop more slowly, than we expect, which could adversely
impact our operating results.

 If
we are unable to manage our growth effectively, we may not be able to take advantage of market opportunities or develop new solutions
or upgrades to our existing solutions, satisfy customer requirements, maintain the quality and security of our solutions, or execute
our business plan, any of which could harm our business, operating results and financial condition.

 We
are required to undergo a lengthy customization and certification process for each wireless carrier customer, which increases our operating
expenses and cost of revenue, and failure to obtain such certification would adversely impact our results of operations and financial
condition.

 Each
wireless carrier requires each of our devices to complete a thorough technical acceptance process before it can be stocked and sold.
Such acceptance processes impose rigorous and complex requirements on our devices, which result in a lengthy testing and certification
process, during which we incur substantial operating expenses related to the wireless carrier's technical acceptance of our devices.
The acceptance processes and related costs to us vary across carrier customers depending on carrier size and level of customization required.
Generally, the certification process commences within one to three months of product concept development. During this development stage,
certain carriers provide a technology roadmap and target demographics, allowing us to define product specifications to meet carrier goals,
while other carriers provide defined specifications and preferred price points. Once we receive approval of a product concept by the
carrier, we and the carrier advance the product to the development stage. When the product is close to becoming a functioning model,
we commence internal quality assurance processes and field testing, which may include third-party lab testing, in-market field testing,
and interoperability testing. Finally, as the last step in the testing phase, the wireless carrier typically conducts testing itself,
following which the product may be certified and stocked. The entire process can last from 6 to 18 months depending on the particular
wireless carrier and type of device. Any delay in the acceptance process or failure to satisfy the device certification requirements
affects our ability to bring products to market and adversely impacts our results of operations and financial condition.

 We
experience lengthy sales cycles for our products and the delay of an expected large order could result in a significant unexpected revenue
shortfall.

 The
purchase of our products is often an enterprise-wide decision for prospective customers, which requires us to engage in sales efforts
over an extended period of time and provide a significant level of education to prospective customers regarding the uses and benefits
of such devices. Prospective customers, especially the wireless carriers that sell our products, often undertake a prolonged evaluation
process that may take from several months to several years in certain cases. Consequently, if our forecasted sales from a specific customer
are not realized, we may not be able to generate revenues from alternative sources in time to compensate for the shortfall. The loss
or delay of an expected large order could also result in a significant unexpected revenue shortfall. Moreover, to the extent we enter
into and deliver our products pursuant to significant contracts earlier than we expected, our operating results for subsequent periods
may fall below expectations. We may spend substantial time, effort, and money on our sales and marketing efforts without any assurance
that our efforts will produce any sales. If we are unable to succeed in closing sales with new and existing customers, our business,
operating results, and financial condition will be harmed.

 If
we fail to adequately forecast demand for our inventory and supply needs, we could incur additional costs or experience manufacturing
delays, which could reduce our gross margin or cause us to delay or even lose sales.

 Because
our production volumes are based on a forecast of channel partner demand rather than firm purchase commitments from our major customers,
our forecasts have been, and there is a risk that our forecasts could be inaccurate in the future. There is a risk that we will be unable
to sell our products at the volumes and prices we expect, which may result in excess inventory. We provide, and will continue to provide,
forecasts of our demand to our third-party suppliers prior to the scheduled delivery of products to our channel partners. If we overestimate
our requirements, our contract manufacturers may have excess component inventory, which could increase our costs. If we underestimate
our requirements, our contract manufacturers may have inadequate component inventory, which could interrupt the manufacturing of our
products and result in delays in shipments and revenues, lost sales, or we could incur unplanned overtime costs to meet our requirements,
resulting in significant cost increases. For example, certain materials and components used to manufacture our products may reach end
of life during any of our product's life cycles, following which suppliers no longer provide such expired materials and components.
This would require us to either source and qualify an alternative component, which could require a re-certification of the device by
the wireless carriers and/or regulatory agencies or forecast product demand for a final purchase of such materials and components that
may reach end of life to ensure that we have sufficient product inventory through a product's life cycle. If we overestimate forecasted
demand, we will hold excess end-of-life materials and components resulting in increased costs. If we underestimate forecasted demand,
we could experience delays in shipments and loss of revenues.

 In
addition, if we underestimate our requirements and the applicable supplier becomes insolvent or is no longer able to timely supply our
needs in a cost-efficient manner or at all, we may be required to acquire components, which may need to be customized for our products,
from alternative suppliers, including at significantly higher costs. For example, in 2018, one of our suppliers became insolvent and
ceased all production, requiring us to seek alternative supply of complex components in a very short time frame. If we cannot source
alternative suppliers and/or alternative components, we may suffer delays in shipments or lost sales. Similarly, credit constraints at
our suppliers could require us to accelerate payment of our accounts payable, impacting our cash flow. Further, lead times for materials
and components that we order vary significantly and depend on factors such as the specific supplier, contract terms, customization needed
for any particular component and demand for each component at a given time. Any such failure to accurately forecast demand and manufacturing
and supply requirements, and any need to obtain alternative supply sources, could materially harm our business, results of operations,
and financial condition.

 The
markets for our mobile devices and related accessories may not develop as quickly as we expect or may not develop at all.

 Our
future success is substantially dependent upon continued adoption of devices and related accessories in the industrial enterprise and
public sector markets, including the transition from LMR and PTT to smartphone and cellular networks. These market developments and transitions
may take longer than we expect or may not occur at all and may not be as widespread as we expect. If the market does not develop as we
expect, our business, operating results, and financial condition will be significantly harmed.

 Our
dependence on third-party suppliers for key components of our products could delay shipment of our products and reduce our sales.

 We
depend on certain suppliers for the delivery of components used in the assembly of our products, including machined parts, injection
molded plastic parts, printed circuit boards, and other miscellaneous custom parts for our products. Our reliance on third-party suppliers
creates risks related to our potential inability to obtain an adequate supply of components and reduced control over pricing and timing
of delivery of components. In particular, we have little to no control over the prices at which our suppliers sell materials and components
to us. The components business has, from time to time, experienced periods of extreme shortages in product supply, generally as the result
of demand exceeding available supply. Many companies use the same raw materials and supplies that we do in the production of their products.
Companies with more resources than our own may have a competitive advantage in obtaining raw materials and supplies due to greater buying
power. When these shortages occur, suppliers also tend to either increase prices or reduce the number of units sold to customers. In
addition, certain supplies of our components are available only from a single source or limited sources and we may not be able to diversify
suppliers in a timely manner. We have experienced shortages in the past that have negatively impacted our results of operations and may
experience such shortages in the future. These factors can result in reduced supply, higher prices of components used in the assembly
of our products, and delays in the receipt of certain of our key components, which in turn may generate increased costs, lower margins,
and delays in product delivery, with a corresponding adverse effect on revenues and customer relationships.

 We
also do not have long-term supply agreements with any of our suppliers. Our current contracts with certain suppliers may be canceled
or not extended by such suppliers and, therefore, do not afford us sufficient protection against a reduction or interruption in supplies.
Moreover, if any of these suppliers breach their contracts with us, our legal remedies associated with such a breach may be insufficient
to compensate us for any damages we may suffer.

 Any
interruption of supply for any material components of our products for any reason, including but not limited to global or local health
crises, or inability to obtain required components from our third-party suppliers, could significantly delay the production and shipment
of our products and harm our revenues, profitability and financial condition.

 Our
future success is dependent on our ability to create independent brand awareness for our company and products with end customers, and
our inability to achieve such brand awareness could limit our prospects.

 We
depend on a small number of wireless carriers to distribute our products. While we intend to accelerate direct marketing
and end-customer brand awareness initiatives in the future, our sales and marketing efforts have historically been predominantly focused
on channel partners. As such, historically, our operating expenses related to end-customer marketing efforts have historically been very
small, representing less than 1.0% of our total sales and marketing expenses (including during the years ended December 31, 2023 and
2022). Increasing end-customer brand awareness requires investment in our sales and marketing efforts. As a result, we expect our sales
and marketing expenses to increase in the future, primarily from increased sales personnel expenses, which will require us to cost-efficiently
ramp up our sales and marketing capabilities and effectively target end customers. However, there can be no assurance that we will successfully
increase our brand awareness or do so in a cost-efficient manner while maintaining market share within our existing sales channels. Our
failure to establish stand-alone brand awareness with end customers of our products would leave us vulnerable to competitors and have
an adverse impact on our prospects. If we are unable to significantly increase the awareness of our brand and solutions with end customers
in a cost-efficient manner, we will remain significantly dependent on our channel partners for sales of our products and would adversely
impact our ability to grow our business.

 If
we are unable to sell our solutions into new markets, our revenues may not grow.

 Any
new market into which we attempt to sell our solutions may not be receptive. Our ability to penetrate new markets depends on the quality
of our solutions, the continued adoption of our public safety solution by first responders, the perceived value of our solutions as a
risk management tool and our ability to design our solutions to meet the demands of our customers. If the markets for our solutions do
not develop as we expect, our revenues may not grow.

 Our
ability to successfully face these challenges depends on several factors, including increasing the awareness of our solutions and their
benefits, the effectiveness of our marketing programs, the costs of our solutions, our ability to attract, retain and effectively train
sales and marketing personnel, and our ability to develop relationships with wireless carriers and other partners. If we are unsuccessful
in developing and marketing our solutions into new markets, new markets for our solutions might not develop or might develop more slowly
than we expect, either of which would harm our revenues and growth prospects.

in the availability of federal funding to support local public safety or other public sector efforts could impact our opportunities with
public sector end customers.

 Many
of our public sector end customers rely to some extent on funds from the U.S. federal government to purchase and pay for our solutions.
Any reduction in federal funding for local public safety or other public sector efforts could result in our end customers having less
access to funds required to continue, renew, expand, or pay for our solutions. If federal funding is reduced or eliminated and our end
customers cannot find alternative sources of funding to purchase our solutions, our business will be harmed.

 Failure
of our suppliers, subcontractors, distributors, resellers, and representatives to use acceptable legal or ethical business practices,
or to fail for any other reason, could negatively impact our business.

 We
do not control the labor and other business practices of our suppliers, subcontractors, distributors, resellers, and third-party sales
representatives (the "TPSRs"), and cannot provide assurance that they will operate in compliance with applicable rules, and
regulations regarding working conditions, employment practices, environmental compliance, anti-corruption, and trademark a copyright
and patent licensing. If one of our suppliers, subcontractors, distributors, resellers, or TPSRs violates labor or other laws or implements
labor or other business practices that are regarded as unethical, the shipment of finished products to us could be interrupted, orders
could be canceled, relationships could be terminated, and our reputation could be damaged. If one of our suppliers or subcontractors
fails to procure the necessary license rights to trademarks, copyrights, or patents, legal action could be taken against us that could
impact the salability of our products and expose us to financial obligations to a third party. Any of these events could have a negative
impact on our sales and results of operations.

 Moreover,
any failure of our suppliers, subcontractors, distributors, resellers, and TPSRs, for any reason, including bankruptcy or other business
disruption, could disrupt our supply or distribution efforts and could have a negative impact on our sales and results of operations.

 We
are exposed to risks associated with strategic transactions.

 We
may pursue mergers, acquisitions, or dispositions of businesses or assets or other strategic transactions that we believe will strengthen,
streamline, or expand our business. Each such transaction would be dependent upon several factors, including identifying suitable companies,
businesses, or assets that align with our business strategies, reaching an agreement with the potential counterparties on acceptable
terms, receipt of any applicable regulatory and other approvals, and other conditions. These transactions involve various risks, including
among others:

 difficulties
 related to integrating or managing applicable parts of an acquired business or joint venture and unanticipated changes in customer
 and other third-party relationships subsequent to closing;

 diversion
 of management's attention from day-to-day operations;

 applicable
 antitrust laws and other regulations that may limit our ability to acquire targets or require us to divest an acquired business or
 assets;

 failure
 to realize anticipated benefits, such as cost savings, revenue enhancements, or strengthening or broadening our business;

 potentially
 substantial transaction costs associated with acquisitions, joint ventures, or investments if we or a transaction counterparty seek
 to exit or terminate an interest in the joint venture or investment; and

 potential
accounting impairment or actual diminution or loss of value of our investment if future market, business, or other conditions ultimately
differ from our assumptions at the time such transaction is consummated.

 Risks
Related to Our Financial Condition

 We may not generate sufficient liquidity
to operate our business and maintain its growth.

 We will require significant funds to implement
our business strategy, upgrade and expand our product portfolio, and meet our other liquidity needs. Our historical revenue growth is
not indicative of our future performance, particularly given the wind-down of our tablet sales. There can be no assurance that we will
generate sufficient revenue to offset the cost of maintaining our remaining operations, including significant accounting, legal, administrative,
and other costs associated with being a public company, and successfully expand our business in accordance with our growth strategy. Additionally,
our cash needs may increase in the near future as we focus on growing and developing our data devices businesses and expanding our operations
internationally, and our liquidity may not be sufficient to achieve these objectives.

 We may need to seek to raise additional capital
from the sale of securities or the incurrence of indebtedness to allow us to maintain our operations and invest in growth opportunities.
There can be no assurance that any debt or equity financing will be available to us on acceptable terms, or at all. Additionally, if we
issue additional equity securities to raise funds, whether to existing investors or others, the ownership percentage of our existing stockholders
would be reduced. New investors may demand rights, preferences, or privileges senior to those of existing holders of common stock. We
may also be limited as to the amount of funds we can raise pursuant to SEC rules and the continued listing requirements of Nasdaq.

 An inability to maintain adequate cash on hand,
generate sufficient cash flow from our operations, or access capital financing on acceptable terms will reduce our chances to compete
successfully and expand our business in the manner currently contemplated and adversely affect our business and results of operations.

 Our
liquidity has been adversely impacted by our ongoing net losses, and there is no assurance that we will have sufficient liquidity to
continue operations.

 We
have incurred significant net losses since 2013 and have an accumulated deficit of $250.0 million as of December 31, 2023. We cannot
provide any assurance that we will be able to secure sufficient liquidity to fund our operations, including through additional capital
from the sale of equity securities or financings, or that we will be able to achieve profitability through cost efficiencies implemented
in 2023 and 2022. If we are unable to generate or obtain the requisite amount of financing needed to fund our business operations, our
liquidity and ability to continue operations could be materially adversely affected. As a result, we may be required to delay, reduce,
or cease our operations and seek bankruptcy protection.

 We
have not been profitable in recent years and may not achieve or maintain profitability in the future.

 We
have incurred significant net losses since 2013 and have an accumulated deficit of $250.0 million as of December 31, 2023. We are not
certain whether or when we will obtain a high enough volume of sales of our products to sustain or increase our growth or achieve or
maintain profitability in the future. We also expect our costs to increase in future periods, which would negatively impact our future
operating results if our revenues do not increase. In particular, we expect to continue to expend substantial financial and other resources
on:

 research
 and development related to our solutions, including investments in our engineering and technical teams;

 expansion
 of our sales and marketing efforts;

 general
 and administrative expenses, including legal and accounting expenses related to being, a public company; and

 continued
 expansion of our business.

 These
investments may not result in increased revenues or growth in our business. Additionally, we have recently and may continue to encounter
unforeseen operating expenses, difficulties, complications, delays, and other unknown factors that may result in losses in future periods.
If we are unable to increase our revenues at a rate sufficient to offset the expected increase in our costs, our business, operating
results, and financial position may be harmed, and we may not be able to achieve or maintain profitability over the long term. We are subject
to the risks and uncertainties associated with the development and release of new products. Our principal sources of liquidity as of
December 31, 2023 consist of existing cash and cash equivalents totaling $9.4 million. The cost structure of the company has been significantly
reduced and many aspects of product development and operational support have been outsourced to add additional spending flexibility if
needed. Existing capital at December 31, 2023 is expected to allow the company to continue operations for at least the next twelve months.
If necessary, we will seek to raise additional capital from new debt. There can be no assurance that additional financing will be available
to us on acceptable terms, or at all. Additionally, if we issue additional equity securities to raise funds, whether to existing investors
or others, the ownership percentage of our existing stockholders would be reduced. New investors may demand rights, preferences, or privileges
senior to those of existing holders of common stock. Additionally, we may be limited as to the amount of funds we can raise pursuant
to SEC rules and the continued listing requirements of the Nasdaq Stock Market or Nasdaq. If we cannot grow our revenue run-rate or raise
needed funds, we might be forced to make additional reductions in our operating expenses, which could adversely affect our ability to
implement our business plan and ultimately our viability as a Company.

 Our
ability to use our net operating losses to offset future taxable income will be subject to certain limitations.

 As
of December 31, 2023 and 2022, we had U.S. federal and state net operating loss carryforwards, or NOLs, of $95.2 million and $88.4 million,
respectively, due to prior period losses, a portion of which expire in various years beginning in 2037 and 2035, respectively, if not
utilized. In general, under Section 382 of the Internal Revenue Code of 1986, as amended, or the Code, a corporation that undergoes an
"ownership change" is subject to limitations on its ability to utilize its NOLs to offset future taxable income. Due to the
investment by AJP Holding Company, LLC in 2022 and the resulting ownership change, the future use of the NOLs to reduce future taxable
income of the Company is severely limited.

 Risks
Related to Information Technology and Intellectual Property

 A
security breach or other significant disruption of our IT systems or those of our partners, suppliers, or manufacturers, caused by cyberattacks
or other means, could have a negative impact on our operations, sales, and operating results.

 We
rely extensively on our information systems to manage our business operations. We have experienced and expect to continue to experience
attempts to compromise our information technology systems and those of our third-party service providers. All IT systems are potentially
vulnerable to damage, unauthorized access, or interruption from a variety of sources, including but not limited to, cyberattacks, cyber
intrusions, computer viruses, security breaches, denial-of-service attacks, ransomware or other malware, energy blackouts, natural disasters
and severe weather conditions, terrorism, sabotage, war, insider trading, human error, and computer and telecommunication failures. Additionally,
like other mobile device manufacturers, we use open-source software from time to time, which may be more susceptible to cybersecurity
vulnerabilities that may not be identified timely. We are also dependent upon third-party manufacturers and service providers to adequately
protect our IT systems. We do not have direct oversight or influence over how third parties manage the security, quality, or resiliency
of their networks.

 A
cyberattack or other significant disruption involving our IT systems or those of our outsource partners, suppliers, or manufacturers
could result in the unauthorized release of proprietary, confidential, or sensitive information of ours or result in virus and malware
installation on our devices. Such unauthorized access to, or release of, this information or other security breaches could: (i) allow
others to unfairly compete with us, (ii) compromise safety or security, (iii) subject us to claims for breach of contract, tort, and
other civil claims, and (iv) damage our reputation. We could face regulatory penalties, enforcement actions, remediation obligations,
or private litigation by parties whose data is improperly disclosed or misused. Any or all of the foregoing could negatively impact on
our business, financial condition, and results of operations.

 If
we are unable to successfully protect our intellectual property, our competitive position may be harmed.

 Our
ability to compete is heavily affected by our ability to protect our intellectual property. We rely on a combination of patents, patent
applications, copyright and trademark laws, trade secrets, confidentiality procedures, and contractual provisions to protect our proprietary
rights. We also enter, and plan to continue to enter, into confidentiality, invention assignment, or license agreements with our employees,
consultants, and other parties with whom we contract, and control access to and distribution of our software, documentation, and other
proprietary information. The steps we take to protect our intellectual property may be inadequate, and it is possible that some or all
of our confidentiality agreements will not be honored, and certain contractual provisions may not be enforceable. Existing trade secret,
trademark, and copyright laws offer only limited protection. Unauthorized parties may attempt to copy aspects of our products or obtain
and use information that we regard as proprietary. Policing unauthorized use of our products is difficult, time-consuming, and costly,
particularly in foreign countries where the laws may not protect our proprietary rights as fully as in the United States. We cannot assure
you that our means of protecting our proprietary rights will be adequate or that our competitors will not independently develop similar
technology, the effect of either of which would harm our competitive position in the market. Furthermore, disputes can arise with our
strategic partners, customers, or others concerning the ownership of intellectual property.

 Others
may claim that we infringe on their intellectual property rights, which may result in costly and time-consuming litigation and could
delay or otherwise impair the development and commercialization of our products.

 In
recent years, there has been a significant increase in litigation in the United States involving patents and other intellectual property
rights, and because our products are comprised of complex technology, we are often involved in or impacted by assertions, including both
requests to take licenses and litigation, regarding infringement of patent and other intellectual property rights of third parties. Third
parties have asserted, and in the future may assert, intellectual property infringement claims against us and against our channel partners,
end customers, and suppliers. Many of these assertions are brought by non-practicing entities whose principal business model is to secure
patent licensing revenues from product manufacturing companies. Claims for alleged infringement and any resulting lawsuit, if successful,
could subject us to significant liability for damages and invalidation of our intellectual property rights. Defending any such claims,
with or without merit, including pursuant to indemnity obligations, could be time-consuming, and expensive, cause product shipment delays,
or require us to enter into a royalty or licensing agreement, any of which could delay the development and commercialization of our products
or reduce our margins. If we are unable to obtain a required license, our ability to sell or use certain products may be impaired. In
addition, if we fail to obtain a license, or if the terms of the license are burdensome to us, our operations could be significantly
harmed.

 Our
use of open-source software could subject us to possible litigation or otherwise impair the development of our products.

 A
portion of our technologies incorporates open-source software, including open-source operating systems such as Android, and we expect
to continue to incorporate open-source software into our platform in the future. Few of the licenses applicable to open-source software
have been interpreted by courts, and their application to the open-source software integrated into our proprietary technology platform
may be uncertain. If we fail to comply with these licenses, then pursuant to the terms of these licenses, we may be subject to certain
requirements, including requirements that we make available the source code for our software that incorporates the open-source software.
We cannot assure you that we have not incorporated open-source software in our software in a manner that is inconsistent with the terms
of the applicable licenses or our current policies and procedures. If an author or other third party that distributes such open-source
software were to allege that we had not complied with the conditions of one or more of these licenses, we could incur significant legal
expenses defending against such allegations. Litigation could be costly for us to defend, have a negative effect on our operating results
and financial condition, or require us to devote additional research and development resources to change our technology platform.

 With
respect to open-source operating systems, if third parties cease continued development of such operating systems or restrict our access
to such operating systems, our business and financial results could be adversely impacted. We are dependent on third parties' continued
development of operating systems, software application ecosystem infrastructures, and such third parties' approval of our implementations
of their operating and system and associated applications. If such parties cease to continue development or support of such operating
systems or restrict our access to such operating systems, we would be required to change our strategy for our devices. As a result, our
financial results could be negatively impacted because a resulting shift away from the operating systems we currently use, and the associated
applications ecosystem could be costly and difficult.

 Our
inability to obtain and maintain any third-party license required to develop new products and product enhancements could seriously harm
our business, financial condition, and results of operations.

 From
time to time, we are required to license technology from third parties to develop new products or product enhancements. For example,
we have entered into worldwide intellectual property cross-license agreements or other technology license agreements with a number of
global technology companies in the mobile telecommunications market. Third-party licenses may not be available to us on commercially
reasonable terms, or at all. If we fail to renew any intellectual property license agreements on commercially reasonable terms, or any
such license agreements otherwise expire or terminate, we may not be able to use the patents and technologies of these third parties
in our products, which are critical to our success. We cannot assure you that we will be able to effectively control the level of licensing
and royalty fees paid to third parties, and a significant increase in such fees could have a significant and adverse impact on our future
profitability. Seeking alternative patents and technologies may be difficult and time-consuming, and we may not be successful in finding
alternative technologies or incorporating them into our products. Our inability to obtain any third-party license necessary to develop
new products or product enhancements could require us to obtain substitute technology of lower quality or performance standards, or at
greater cost, which could seriously harm our business, financial condition, and results of operations.

 Increasing
regulatory focus on privacy and cybersecurity issues and expanding laws could expose us to liability, subject us to lawsuits, investigations,
and other liabilities and restrictions on our operations that could significantly and adversely affect our business.

 Personal
privacy and information security are significant issues in the United States and the other jurisdictions in which we operate or make
our products and applications available. The legislative and regulatory framework for privacy and security issues worldwide is rapidly
evolving and may be inconsistent from jurisdiction to jurisdiction. Examples of these laws include but are not limited to:

 various
 comprehensive U.S. state and foreign privacy laws, which give new data privacy rights to their respective residents (including, in
 California, a private right of action in the event of a data breach resulting from our failure to implement and maintain reasonable
 security procedures and practices) and impose significant obligations on controllers and processors of consumer data;

 the
 General Data Protection Regulation and the United Kingdom General Data Protection Regulations, which apply to all of our activities
 conducted from an establishment in the EU or the United Kingdom, respectively, or related to products and services that we offer
 to EU or the United Kingdom users or customers, respectively, or the monitoring of their behavior in the EU or the UK, respectively;
 and

 the
 California Internet of Things Security Law, which regulates the security of data used in connection with internet-connected devices.

 We
may incur substantial expense in complying with the obligations imposed by various jurisdictions in which we do business or seek to do
business and we may be required to make significant changes in our business operations, all of which may adversely impact our revenues
and our business overall. Additionally, our failure or perceived failure to comply with privacy and information security laws and regulations
would result in negative publicity fines and orders requiring that we change our practices, which will adversely affect our business,
reputation, financial condition, and operating results.

 Risks
Related to Legal and Regulatory Matters

in laws and regulations concerning the use of telecommunication bandwidth could increase our costs and adversely impact our business.

 Our
business depends on our ability to sell devices that use telecommunication bandwidth allocated to licensed and unlicensed wireless services,
and that use of that bandwidth is subject to laws and regulations that are subject to change over time. Changes in the permitted uses
of telecommunication bandwidth, reallocation of such bandwidth to different uses, and new or increased regulation of the capabilities,
manufacture, importation, and use of devices that depend on such bandwidth could increase our costs, require costly modifications to
our products before they are sold, or limit our ability to sell those products into our target markets. In addition, we are subject to
regulatory requirements for certification and testing of our products before they can be marketed or sold. Those requirements may be
onerous and expensive. Changes to those requirements could result in significant additional costs and could adversely impact our ability
to bring new products to market in a timely fashion.

 The
interpretation and implementation of the various provisions of the Communications Act of 1924, as amended, and the FCC rules implementing
said act continue to be heavily debated and may have a material adverse effect on our business. FCC regulatory activity has increased
in 2023 and 2024, particularly in connection with broadband the origin of hardware (including chipsets) and software used in telecommunication
and data devices. We cannot predict how increased regulatory activity at the FCC will impact our businesses but expect increased legal
and compliance costs. If we do not comply with FCC rules, regulations, orders, policies, or procedures we could be subject to FCC enforcement
actions, fines, and possibly restrictions on our ability to operate or offer certain or all of our products in the United States. Any
enforcement action by the FCC, which may be a public process, would hurt our reputation in the industry, could erode customer trust,
possibly impair our ability to sell our products to customers, and could adversely affect our business, results of operations, and financial
condition.

in U.S. trade policy, including the imposition of tariffs and restrictions and the resulting consequences, may have a material adverse
impact on our business, operating results, and financial condition.

 The
U.S. government has adopted a new approach to trade policy, including in some cases renegotiating and terminating certain existing bilateral
or multi-lateral trade agreements, such as the North American Free Trade Agreement. The U.S. government has also initiated tariffs on
certain foreign goods from a variety of countries and regions, most notably China, where we outsource the manufacturing of our mobile
phones, and has raised the possibility of imposing significant, additional tariff increases or expanding the tariffs to capture other
types of goods. In response, many of these foreign governments have imposed retaliatory tariffs on goods that their countries import
from the U.S. Changes in U.S. trade policy have and may continue to result in one or more foreign governments adopting responsive trade
policies that make it more difficult or costly for us to do business in or import our products from those countries. In addition, the
FCC rules prohibit communications equipment deemed to pose an unacceptable risk to national security from obtaining the equipment authorization
that allows the products to be imported, marketed, or sold in the U.S.

 This
in turn could result in significant additional costs to us when shipping our products to various customers in the United States and could
require us to increase prices to our customers, which may reduce demand, or, if we are unable to increase prices, result in lowering
our margin on products sold.

 We
cannot predict the extent to which the U.S. or other countries will impose new or additional quotas, duties, tariffs, taxes or other
similar restrictions upon the import or export of our products in the future, nor can we predict future trade policy or the terms of
any renegotiated trade agreements and their impact on our business. The adoption and expansion of trade restrictions, the occurrence
of a trade war, or other governmental action related to tariffs or trade agreements, or policies has the potential to adversely impact
demand for our products, our costs, our customers, our suppliers, and the U.S. economy, which in turn could have a material adverse effect
on our business, operating results and financial condition.

 The
unfavorable outcome of any future litigation, arbitration, or administrative action could have a significant adverse impact on our financial
condition or results of operations.

 From
time to time, we are a party to litigation, arbitration, or administrative actions. Our business may bring us into conflict with third
parties with whom we have contractual or other business relationships, or with our competitors or others whose interests differ from
ours. If we are unable to resolve those conflicts on terms that are satisfactory to all parties, we may become involved in litigation
brought by or against us. Our financial results and reputation could be negatively impacted by unfavorable outcomes to any future litigation
or administrative actions, including those related to the Foreign Corrupt Practices Act, the U.K. Bribery Act, or other anti-corruption
laws. Monitoring, initiating, and defending against legal actions is time-consuming for our management, likely to be expensive, and may
detract from our ability to fully focus our internal resources on our business activities. In addition, despite the availability of insurance,
we may incur substantial legal fees and costs in connection with litigation. Lawsuits are subject to inherent uncertainties, and defense
and disposition costs depend upon many unknown factors. Lawsuits could result in judgments against us that require us to pay damages,
enjoin us from certain activities, or otherwise negatively affect our legal or contractual rights, which could have a significant adverse
effect on our business. In addition, the inherent uncertainty of such litigation could lead to increased volatility in our stock price
and a decrease in the value of our stockholders' investment in our common stock. There can be no assurances as to the favorable
outcome of any litigation or administrative proceedings. In addition, it can be very costly to defend litigation or administrative proceedings
and these costs could negatively impact our financial results.

 We
may incur substantial costs and receive adverse outcomes in litigation, regulatory investigations, and other legal matters in connection
with alleged violations of securities laws and regulations.

 Our
business, financial condition, and results of operations could be materially adversely affected by unfavorable results in pending or
future litigations, regulatory investigations, and other legal matters related to violations or perceived violations of applicable securities
laws and regulations by the Company or its affiliates.

 We
have been subject to the SEC investigation and stockholders' class actions in the past and may become subject to securities-related
investigations or legal proceedings in the future. The ultimate resolution of such investigations and lawsuits cannot be predicted, and
the claims raised in these lawsuits may result in further legal matters or actions against us, including, but not limited to, government
enforcement actions or additional private litigation. We were subject to an SEC investigation that had started in March 2020. Although
there were no penalties imposed against the Company as a result of that SEC investigation, we cannot predict the outcome of any particular
proceeding, or whether any new SEC investigation will be resolved favorably or ultimately result in charges or material damages, fines,
or other penalties, enforcement actions, or civil or criminal proceedings against us or members of our senior management.

 Litigation
matters and regulatory investigations, regardless of their merits or their ultimate outcomes, are costly, divert management's attention,
and may materially adversely affect our reputation and demand for our products. We cannot predict with certainty the eventual outcome
of pending or future legal matters. An adverse outcome of litigation or legal matters could result in us being responsible for significant
damages. Any of these negative effects resulting from litigation, regulatory investigations, and other legal matters could materially
adversely affect our business, financial condition, and results of operations.

 We
are subject to anti-corruption, anti-bribery, anti-money laundering, economic sanctions, export control, and similar laws. Non-compliance
with such laws can subject us to criminal or civil liability and harm our business, revenues, financial condition, and results of operations.

 We
are subject to the U.S. Foreign Corrupt Practices Act of 1977, as amended, the U.S. domestic bribery statute contained in 18 U.S.C. §
201, the U.S. Travel Act, and other anti-bribery and anti-money laundering laws in the countries in which we conduct activities. Anti-corruption
and anti-bribery laws have been enforced aggressively in recent years and are interpreted broadly to generally prohibit companies and
their employees and third-party intermediaries from authorizing, offering, or providing, directly or indirectly, improper payments or
benefits to recipients in the public or private sector. As we increase our international presence, we may engage with distributors and
third-party intermediaries to market our solutions and to obtain necessary permits, licenses, and other regulatory approvals. In addition,
we or our third-party intermediaries may have direct or indirect interactions with officials and employees of government agencies or
state-owned or affiliated entities. We can be held liable for the corrupt or other illegal activities of these third-party intermediaries,
our employees, representatives, contractors, partners, and agents, even if we do not explicitly authorize such activities.

 The
United States has imposed economic sanctions that affect transactions with designated foreign countries, nationals and others. In particular,
the United States prohibits U.S. persons from engaging with individuals and entities identified as "Specially Designated Nationals,"
such as terrorists and narcotics traffickers. These prohibitions are administered by the U.S. Department of the Treasury's Office
of Foreign Assets Control, or OFAC. OFAC rules prohibit U.S. persons from engaging in, or facilitating a foreign person's engagement
in, transactions with or relating to the prohibited individual, entity or country, and require the blocking of assets in which the individual,
entity or country has an interest. Blocked assets (e.g., property or bank deposits) cannot be paid out, withdrawn, set off or transferred
in any manner without a license from OFAC. Other countries in which we operate, including Canada and the United Kingdom, also maintain
economic and financial sanctions regimes.

 Some
of our solutions, including software updates and third-party accessories, may be subject to U.S. export control laws, including the Export
Administration Regulations; however, the vast majority of our products are non-U.S.-origin items, developed and manufactured outside
of the United States, and therefore not subject to these laws. For third-party accessories, we rely on manufacturers to supply the appropriate
export control classification numbers that determine our obligations under these laws.

 We
cannot assure you that our employees and agents will not take actions in violation of our policies and applicable law, for which we may
be ultimately held responsible. As we increase our international presence, our risks under these laws, rules, and regulations may increase.
Further, any change in the applicability or enforcement of these laws, rules, and regulations could adversely impact our business operations
and financial results.

 Detecting,
investigating and resolving actual or alleged violations can require a significant diversion of time, resources, and attention from senior
management. In addition, noncompliance with anti-corruption, anti-bribery, anti-money laundering, or economic sanctions laws, rules,
and regulations could subject us to whistleblower complaints, investigations, sanctions, settlements, prosecution, other enforcement
actions, disgorgement of profits, significant fines, damages, other civil and criminal penalties or injunctions, suspension and/or debarment
from contracting with certain persons, the loss of export privileges, reputational harm, adverse media coverage, and other collateral
consequences. If any subpoenas or investigations are launched, or governmental or other sanctions are imposed, or if we do not prevail
in any possible civil or criminal litigation, our business, revenues, financial condition, and results of operations would be significantly
harmed. In addition, responding to any action will likely result in a significant diversion of management's attention and resources
and significant defense costs and other professional fees. Enforcement actions and sanctions could further harm our business, financial
condition and results of operations.

 We
are subject to a wide range of product regulatory and safety, consumer, worker safety and environmental laws and regulations.

 Our
operations and the products we manufacture and/or sell are subject to a wide range of product regulatory and safety, consumer, worker
safety and environmental laws and regulations. Compliance with such existing or future laws and regulations could subject us to future
costs or liabilities, impact our production capabilities, constrict our ability to sell, expand or acquire facilities, restrict what
solutions we can offer and generally impact our financial performance. Our products are designed for use in potentially explosive or
hazardous environments. If our product design fails for any reason in such environments, we may be subject to product liabilities and
future costs. In addition, some of these laws are environmental and relate to the use, disposal, remediation, emission, discharge of
and exposure to hazardous substances. These laws often impose liability and can require parties to fund remedial studies or actions regardless
of fault. Environmental laws have tended to become more stringent over time and any new obligations under these laws could have a negative
impact on our operations or financial performance.

 Laws
focused on the energy efficiency of electronic products and accessories, recycling of both electronic products and packaging, reducing
or eliminating certain hazardous substances in electronic products, and the transportation of batteries continue to expand significantly.
Laws pertaining to accessibility features of electronic products, standardization of connectors and power supplies, the transportation
of lithium-ion batteries, and other aspects are also proliferating. There are also demanding and rapidly changing laws around the globe
related to issues such as product safety, radio interference, radio frequency radiation exposure, medical related functionality, and
consumer and social mandates pertaining to use of wireless or electronic equipment. These laws, and changes to these laws, could have
a substantial impact on whether we can offer certain products, solutions, and services, and on what capabilities and characteristics
our products or services can or must include.

 These
laws and regulations impact our products and could negatively impact our ability to manufacture and sell products competitively. In addition,
we anticipate that we will see increased demand to meet voluntary criteria related to reduction or elimination of certain constituents
from products, increasing energy efficiency and providing additional accessibility.

 We
are an "emerging growth company" and we cannot be certain whether 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, and we intend to take advantage of certain exemptions from various
reporting requirements that are applicable to other public companies that are not "emerging growth companies" including,
but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act and
reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements. We cannot predict whether
investors will find our common stock less attractive if we rely on these exemptions. If some investors find our common stock less attractive
as a result, there may be a less active trading market for our common stock and our stock price may be more volatile.

 The
requirements of being a public company may strain our resources and distract our management, which could make it difficult to manage
our business, particularly after we are no longer an "emerging growth company."

 We
are required to comply with various regulatory and reporting requirements, including those required by the SEC. Complying with these
reporting and other regulatory requirements will be time-consuming and will result in increased costs to us and could have a negative
effect on our results of operations, financial condition or business.

 As
a public company, we are subject to the reporting requirements of the Exchange Act and requirements of the Sarbanes-Oxley Act. These
requirements may place a strain on our systems and resources. The Exchange Act requires that we file annual, quarterly and current reports
with respect to our business and financial condition. The Sarbanes- Oxley Act requires that we attest to having internal controls over
financial reporting. To maintain and improve the effectiveness of our disclosure controls and procedures, we will need to commit significant
resources, hire additional staff and provide additional management oversight. We will be implementing additional procedures and processes
for the purpose of addressing the standards and requirements applicable to public companies. Sustaining our growth also will require
us to commit additional management, operational and financial resources to identify new professionals to join our firm and to maintain
appropriate operational and financial systems to adequately support expansion. These activities may divert management's attention
from other business concerns, which could have a significant adverse impact on our results of operations, financial condition or business.

 As
an "emerging growth company" as defined in the JOBS Act, we intend to take advantage of certain temporary exemptions from
various reporting requirements including, but not limited to, not being required to comply with the auditor attestation requirements
of Section 404 of the Sarbanes-Oxley Act and reduced disclosure obligations regarding executive compensation in our periodic reports
and proxy statements. In addition, we have elected under the JOBS Act to delay adoption of new or revised accounting pronouncements applicable
to public companies until such pronouncements are made applicable to private companies. As a result, our financial statements may not
be comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates.

 When
these exemptions cease to apply, we expect to incur additional expenses and devote increased management effort toward ensuring compliance
with them. We cannot predict or estimate the amount of additional costs we may incur as a result of becoming a public company or the
timing of such costs.

 Risks
Related to Ownership of Our Common Stock

 We
have failed, and may continue to fail, to meet the listing standards of Nasdaq, and as a result, our common stock may become delisted,
which could have a material adverse effect on the trading, liquidity, and market price of our common stock.

 We
must satisfy Nasdaq's continued listing requirements, including, among other things, a minimum closing bid price of $1.00 per share
and timely filing of all periodic financial reports, or risk delisting, which would have a material adverse effect on our business.

 On
September 14, 2023, we received a letter from Nasdaq notifying us that, because the bid price for our common stock has fallen below $1.00
per share for 30 consecutive business days, we no longer comply with the $1.00 minimum bid price requirement set forth in Nasdaq Listing
Rule 5550(a)(2) (the "Bid Price Rule") for continued listing. In accordance with Nasdaq
Listing Rule 5810(c)(3)(A), we were provided a period of 180 calendar days, or through March 12, 2024, to regain compliance with the
Bid Price Rule. On March 13, 2024, we received a written notice from Nasdaq that the Company was eligible for an additional 180 calendar
day period, or until September 9, 2024 (the "Compliance Date"), to regain compliance with the Bid Price Rule. To regain compliance,
the closing bid price of the Company's common stock must be at least $1.00 per share for a minimum of ten (10) consecutive business
days as required under Nasdaq Listing Rule 5810(c)(3)(A) before the Compliance Date. If the Company does not regain compliance with the
Bid Price Rule by the Compliance Date, the Nasdaq staff will provide written notice to the Company that its common stock is subject to
delisting. At that time, the Company may appeal the determination to a Nasdaq Hearings Panel (the "Panel'). A timely request
for a hearing will stay any suspension or delisting action pending the issuance of the Panel's decision.

 This
is not the first instance of Sonim's non-compliance with the Bid Price Rule. We intend to actively monitor the closing bid price
of our common stock and, as appropriate, will consider available options to resolve the deficiency and regain compliance with the Bid
Price Rule, including potentially seeking to effect a reverse share split, if necessary. There can be no assurance that we will be able
to regain compliance with respect to the current deficiency including by effecting a reverse share split, or that we will be able to
maintain compliance with the Nasdaq Capital Market continued listing requirements in the future or regain compliance with respect to
any future deficiencies. In the event we are delisted from Nasdaq, the only established trading market for our common stock would be
eliminated, and we would be forced to list our shares on the OTC Markets or another quotation medium, depending on our ability to meet
the specific listing requirements of those quotation systems. As a result, an investor would likely find it more difficult to trade or
obtain accurate price quotations for our shares. Delisting would likely also reduce the visibility, liquidity, and value of our common
stock, reduce institutional investor interest in our company, and may increase the volatility of our common stock. Delisting could also
cause a loss of confidence of potential industry partners, lenders, and employees, which could further harm our business and our future
prospects.

 In
prior years, we identified one material weakness in our internal control over financial reporting which, if not remediated, could have
resulted in material misstatements in our financial statements.

 A
material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting such that there is a
reasonable possibility that a material misstatement of our annual or interim consolidated financial statements may not be prevented or
detected on a timely basis. As of December 31, 2022 and 2021, we identified one material weakness in internal control over financial
reporting that pertains to a deficiency in the design and implementation of IT general controls, including elevated (administrator) access
to financial reporting systems and subsystems, which are not appropriately restricted and segregated.

 We
developed and implemented a plan to remediate the material weakness in 2023. The material weakness has been remediated as of December
31, 2023. We cannot assure you that we will not identify additional material weaknesses in our internal control over financial reporting
in the future.

 We
may become a "controlled company" within the meaning of the applicable rules of Nasdaq and, as a result, may qualify for
exemptions from certain corporate governance requirements. If we rely on these exemptions, our stockholders will not have the same protections
afforded to stockholders of companies that are subject to such requirements.

 Jefferey
Wang, a member of our board of directors and the sole manager of AJP, beneficially owns approximately 45.3% of the issued and outstanding
shares of our common stock as of December 31, 2023. Although the sale of shares of our common stock pursuant to this prospectus may decrease
the beneficial ownership of Mr. Wang, in the event of purchasing more shares of our common stock Mr. Wang may control a majority of the
voting power, and we may then be a "controlled company" within the meaning of applicable rules of the Nasdaq at the time
of conversion. Under these rules, a company is a "controlled company" if more than 50% of the voting power for the election
of directors is held by an individual, group, or another company, and such company may elect not to comply with certain corporate governance
requirements, including the requirements that the company have: (i) a majority of its board of directors comprised of independent directors;
(ii) a nominating and corporate governance committee comprised solely of independent directors; (iii) a compensation committee comprised
solely of independent directors; and (iv) an annual performance evaluation of the nominating and corporate governance and compensation
committees.

 Though
we currently neither anticipate becoming a "controlled company," nor taking advantage of any "controlled company"
exemptions even if deemed to be a "controlled company," if we were to be deemed to be a "controlled company"
and were to elect to be exempt from some or all of these corporate governance requirements, you may not have the same protections afforded
to stockholders of companies that are subject to all of the Nasdaq corporate governance requirements.

 Sales
of our common stock under the currently effective registration statement or the perception of such sales in the public market or otherwise
could cause the market price for our common stock to decline, even if our business is doing well.

 The
sale of shares of our common stock in the public market or otherwise, including sales pursuant to the Form S-3 Registration Statement
and Prospectus, dated December 1, 2023, or the perception that such sales could occur, could reduce the prevailing market price of shares
of our common stock and increase the volatility of our share price. These sales, or the possibility that these sales may occur, also
might make it more difficult for us:

 to
 sell equity securities in the future at a time and at a price that we deem appropriate; and

 to
 comply with the Nasdaq listing standards with regard to the minimum bid price of our common stock.

 Resales
of our common stock may cause the market price of our securities to drop significantly.

 The
shares of common stock offered for resale pursuant to the Form S-3 Registration Statement and Prospectus, dated December 1, 2023, represent
approximately 48.4% of the outstanding shares of our common stock as of December 31, 2023, and approximately 99% of our public float.
Until such time that this registration statement is no longer effective, the registration statement will permit the resale of these shares.
As such, sales of a substantial number of shares of our common stock in the public market could occur at any time.

 Our
quarterly results may vary significantly from period to period, which could make our future results difficult to predict and could cause
our operating results to fall below investor, analyst, or our expectations.

 Our
quarterly results and, in particular, our revenue, gross margins, operating expenses, operating margins and net income (loss), have historically
varied significantly from period to period and may continue to do so in the future. As a result, comparing our operating results on a
period-to-period basis may not be meaningful. Our budgeted expense levels are based, in large part, on our expectations of future revenue
and the development efforts associated with that future revenue. Due to our smaller scale compared to many of our customers, we are particularly
vulnerable to the impacts of changes in these customers' order forecasts. Consequently, if our revenue does not meet projected
levels in the short-term, our inventory levels, cost of goods sold and operating expenses would be high relative to revenue, resulting
in potential operating losses. If our revenue or operating results do not meet the expectations of investors, the price of our common
stock may decline substantially.

 Factors
that may contribute to fluctuations in our quarterly results, many of which are outside our control and may be difficult to predict,
include:

 fluctuations
 in demand, sales cycles and prices for products and services, including discounts given in response to competitive pricing pressures
 or to secure long-term customer relationships, as well as the timing of purchases by our key customers;

 fluctuations
 in our customer, product or geographic mix, including the impact of new customer deployments, which typically carry lower gross margins,
 customer consolidation, which may affect our ability to grow revenue, and products powered by our next-generation technologies, which
 initially tend to be lower margin due to higher per unit production costs and greater variability in production yields;

 the
 timing, market acceptance and rate of adoption of our new product releases and our competitors' new product releases;

 our
 ability to manage manufacturing costs, maintain or improve quality, and increase volumes and yields on products;

 our
 ability to successfully restructure or transform our operations within our anticipated time frame and realize our anticipated savings;

 the
 price, quality and timing of delivery of key components from suppliers, including any shipping cost increases or delays in the supply
 of components, as well as impacts due to consolidations amongst our suppliers;

 order
 cancellations, reductions or delays in delivery schedules by our customers;

 any
 delay in collecting or failure to collect accounts receivable;

 our
 ability to control costs, including our operating expenses and the costs and availability of components we purchase for our products;

 any
 significant changes in the competitive dynamics of the markets we serve, including any new entrants, new technologies, or customer
 or competitor consolidation, as well as aggressive pricing tactics by our competitors;

 our
 ability to manage inventory while timely meeting customer demand and avoiding charges for excess or obsolete inventory;

 the
 availability of third-party service partners to provide contract development and manufacturing services for us;

 the
 timing of revenue recognition and revenue deferrals;

 any
 future changes in U.S. GAAP or new interpretations of existing accounting rules;

 the
 impact of a significant natural disaster, as well as interruptions or shortages in the supply of utilities such as water and electricity;

 general
 economic and political conditions in domestic and international markets, and other factors beyond our control; and

 additional
 developments regarding our intellectual property portfolio and regulatory exclusivity protections, if any.

 The
financial and operational projections that we may provide from time to time are subject to inherent risks.

 The
projections and timelines that our management may provide from time to time (including with respect to financial or operational matters
and the expansion of our product portfolio and business lines) reflect numerous assumptions made by our management with respect to our
specific, as well as general business, economic, market and financial conditions, including our ability to correctly assess the demand
to such products from different consumers and other matters, all of which may be difficult to predict and many of which are beyond our
control.

 Accordingly,
there is a risk that the assumptions made in preparing the projections, or the projections themselves, will prove inaccurate or that
our organic growth and expansion may be curtailed. You should be prepared for differences between actual and projected results from time
to time. Our future actual results may be materially different from those contained in our projections, both as to amounts and as to
timing. The inclusion of projections or timelines in this Annual Report on Form 10-K or any other filing we make with the SEC or otherwise
communicated to investors by us should not be regarded as an indication that we or our management or representatives considered or consider
such projections and timelines to be a reliable prediction of future events, and the projections and timelines should not be relied upon
as such.

 Unless
our common stock continues to be listed on a national securities exchange it will become subject to the so-called "penny stock"
rules that impose restrictive sales practice requirements.

 If
we are unable to maintain the listing of our common stock on Nasdaq or another national securities exchange, our common stock could become
subject to the so-called "penny stock" rules if the shares have a market value of less than $5.00 per share. The SEC has
adopted regulations that define a penny stock to include any stock that has a market price of less than $5.00 per share, subject to certain
exceptions, including an exception for stock traded on a national securities exchange. The SEC regulations impose restrictive sales practice
requirements on broker-dealers who sell penny stocks to persons other than established customers and accredited investors. An accredited
investor generally is a person whose individual annual income exceeded $200,000, or whose joint annual income with a spouse exceeded
$300,000 during the past two years and who expects their annual income to exceed the applicable level during the current year, or a person
with net worth in excess of $1.0 million, not including the value of the investor's principal residence and excluding mortgage
debt secured by the investor's principal residence up to the estimated fair market value of the home, except that any mortgage
debt incurred by the investor within 60 days prior to the date of the transaction shall not be excluded from the determination of the
investor's net worth unless the mortgage debt was incurred to acquire the residence. For transactions covered by this rule, the
broker-dealer must make a special suitability determination for the purchaser and must have received the purchaser's written consent
to the transaction prior to sale. This means that if we are unable to maintain the listing of our common stock on a national securities
exchange, the ability of stockholders to sell their common stock in the secondary market could be adversely affected. If a transaction
involving a penny stock is not exempt from the SEC's rule, a broker-dealer must deliver a disclosure schedule relating to the penny
stock market to each investor prior to a transaction. The broker-dealer also must disclose the commissions payable to both the broker-dealer
and its registered representative, current quotations for the penny stock, and, if the broker-dealer is the sole market-maker, the broker-dealer
must disclose this fact and the broker-dealer's presumed control over the market. Finally, monthly statements must be sent disclosing
recent price information for the penny stock held in the customer's account and information on the limited market in penny stocks.

 Some
provisions of Delaware law and our certificate of incorporation and bylaws may delay or prevent a change in control and may discourage
bids for our common stock at a premium over its market price.

 Our
certificate of incorporation and bylaws provide for, among other things:

 the
 authorization of undesignated preferred stock, the terms of which may be established and shares of which may be issued without stockholder
 approval;

 advance
 notice requirements for stockholder proposals; and

 certain
 limitations on convening special stockholder meetings.

 These
anti-takeover defenses could discourage, delay or prevent a transaction involving a change in control of our company. These provisions
could also discourage proxy contests and make it more difficult for you and other stockholders to elect directors of your choosing and
cause us to take other corporate actions than you desire.

 Additionally,
we are subject to the provisions of Section 203 of the Delaware General Corporation Law, or the DGCL. These provisions prohibit large
stockholders, in particular a stockholder owning 15% or more of the outstanding voting stock, from consummating a merger or combination
with a corporation unless this stockholder receives board approval for the transaction or 66 2/3% of the shares of voting stock not owned
by the stockholder approve the merger or transaction. These provisions of DGCL may have the effect of delaying, deferring or preventing
a change in control, and may discourage bids for our common stock at a premium over its market price.

 Our
amended and restated certificate of incorporation designates the Court of Chancery of the State of Delaware as the sole and exclusive
forum for certain types of actions and proceedings that may be initiated by our stockholders, which could limit our stockholders'
ability to obtain a favorable judicial forum for disputes with us or our directors, officers, employees or agents.

 Our
amended and restated certificate of incorporation provides that, unless we consent in writing to the selection of an alternative forum,
the Court of Chancery of the State of Delaware will, to the fullest extent permitted by applicable law, be the sole and exclusive forum
for the following types of actions or proceedings under Delaware statutory or common law: (i) any derivative action or proceeding brought
on our behalf, (ii) any action asserting a claim of breach of a fiduciary duty owed by any of our directors, officers, employees, agents
or trustees to us or our stockholders, (iii) any action asserting a claim against us or any director or officer or other employee of
ours arising pursuant to any provision of the DGCL, our amended and restated certificate of incorporation or our bylaws or (iv) any action
asserting a claim against us or any director or officer or other employee of ours that is governed by the internal affairs doctrine,
in each such case subject to such Court of Chancery having personal jurisdiction over the indispensable parties named as defendants therein.
Any person or entity purchasing or otherwise acquiring any interest in shares of our capital stock will be deemed to have notice of,
and consented to, the provisions of our amended and restated certificate of incorporation described in the preceding sentence. Under
our amended and restated certificate of incorporation, this exclusive forum provision will not apply to claims which are vested in the
exclusive jurisdiction of a court or forum other than the Court of Chancery of the State of Delaware, or for which the Court of Chancery
of the State of Delaware does not have subject matter jurisdiction. For instance, the provision would not apply to actions arising under
federal securities laws, including suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations
thereunder, jurisdiction over which is exclusively vested by statute in the U.S. federal courts. This exclusive choice of forum provision
may limit a stockholder's ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors,
officers, employees or agents, which may discourage such lawsuits against us and such persons. If a court were to find the choice of
forum provisions contained in our amended and restated certificate of incorporation to be inapplicable or unenforceable in an action,
we may incur additional costs associated with resolving such action in other jurisdictions, which could have a significant impact on
our business, financial condition and results of operations.

 Our
amended and restated certificate of incorporation designates the U.S. federal district courts as the exclusive forum for the resolution
of any complaint asserting a cause of action arising under the Securities Act. We will seek to enforce these provisions.

 Our
amended and restated certificate of incorporation provides that, unless we consent in writing to the selection of an alternative forum,
the federal district courts of the United States shall, to the fullest extent permitted by law, be the sole and exclusive forum for the
resolution of any complaint asserting a cause of action arising under the Securities Act. Section 22 of the Securities Act creates concurrent
jurisdiction for federal and state courts over all suits brought to enforce any duty or liability created by the Securities Act or the
rules and regulations thereunder. Accordingly, there is uncertainty as to whether a court would enforce such provision. The Delaware
Supreme Court recently determined that the exclusive forum provision of federal district courts of the United States of America for resolving
any complaint asserting a cause of action arising under the Securities Act is permissible and enforceable under Delaware law, reversing
an earlier decision from the Court of Chancery of the State of Delaware that had ruled that such provisions were not enforceable. In
light of the Delaware Supreme Court determination that Delaware law permits exclusive federal forum provisions, we have sought to enforce
the exclusive federal forum provision in our amended and restated certificate of incorporation including in pending litigation. Enforcement
of this provision could result in additional costs. If we face relevant litigation and are unable to enforce this provision, we may incur
additional costs associated with resolving such matters in other jurisdictions, which could harm our business, financial condition, or
results of operations.

 The
market price of our common stock is likely to be volatile and could fluctuate or decline, resulting in substantial loss of your investment.

 The
market price of our common stock could be subject to wide fluctuations in response to, among other things, the factors described in this
"Risk Factors" section or otherwise, and other factors beyond our control, such as fluctuations in the valuations of companies
perceived by investors to be comparable to us.

 Furthermore,
the stock markets have experienced price and volume fluctuations that have affected and continue to affect the market prices of equity
securities of many companies. These fluctuations often have been unrelated or disproportionate to the operating performance of those
companies. These broad market fluctuations, as well as general economic, systemic, political, and market conditions, such as recessions,
interest rate changes, or international currency fluctuations, may negatively affect the market price of our common stock.

 The
trading price of our common stock is likely to be volatile and subject to wide price fluctuations in response to various factors, including:

 market
 conditions in the broader stock market in general, or in our industry in particular

 actual
 or anticipated fluctuations in our quarterly financial and operating results;

 introduction
 of new products and services by us or our competitors;

 sales,
 or anticipated sales, of large blocks of our stock;

 issuance
 of new or changed securities analysts' reports or recommendations;

 failure
 of industry or securities analysts to maintain coverage of our company, changes in financial estimates by any industry or securities
 analysts that follow our company, or our failure to meet such estimates;

 additions
 or departures of key personnel;

 regulatory
 or political developments;

 changes
 in accounting principles or methodologies;

 acquisitions
 by us or by our competitors;

 litigation
 and governmental investigations; and

 economic,
 political, and geopolitical conditions or events.

 These
and other factors may cause the market price and demand for our common stock to fluctuate substantially, which may limit or prevent investors
from readily selling their shares of common stock and may otherwise negatively affect the liquidity of our common stock. In addition,
in the past, when the market price of a stock has been volatile, holders of that stock have often instituted securities class action
litigation against the company that issued the stock.

Risk Factors

 Natural
or man-made disasters and other similar events may significantly disrupt our business, and negatively impact our operating results and
financial condition.

 Any
of our facilities may be harmed or rendered inoperable by natural or man-made disasters, including earthquakes, tornadoes, hurricanes,
wildfires, floods, nuclear disasters, acts of terrorism or other criminal activities, infectious disease outbreaks, and power outages,
which may render it difficult or impossible for us to operate our business for some period of time. Any disruptions in our operations
could negatively impact our business and operating results and harm our reputation. For example, our headquarters in Austin, Texas were
shut down without power or water for several days in 2021. In addition, we may not carry business insurance or may not carry sufficient
business insurance to compensate for losses that may occur. Any such losses or damages could have a significant adverse impact on our
business, operating results and financial condition. In addition, the facilities of significant vendors may be harmed or rendered inoperable
by such natural or man-made disasters, which may cause disruptions, difficulties or significant adverse impact on our business.

 Increasing
scrutiny and evolving expectations from investors, customers, lawmakers, regulators, and other stakeholders regarding environmental,
social and governance, or ESG-related practices and disclosures may adversely affect our reputation, adversely impact our ability to
attract and retain employees or customers, expose us to increased scrutiny from the investment community or enforcement authorities or
otherwise adversely impact our business and results of operations.

 There
is increasing scrutiny and evolving expectations from investors, customers, lawmakers, regulators, and other stakeholders on ESG-related
practices and disclosures, including those related to environmental stewardship, climate change, diversity, equity and inclusion, forced
labor, racial justice, and workplace conduct. Regulators have imposed, and likely will continue to impose, ESG-related rules and guidance,
which may conflict with one another and impose additional costs on us or expose us to new or additional risks. Moreover, certain organizations
that provide information to investors have developed ratings for evaluating companies on their approach to different ESG-related matters,
and unfavorable ratings of us or our industry may lead to negative investor sentiment and the diversion of investment to other companies
or industries. As a smaller company, we may not have resources to meet the evolving ESG-related expectations of an investment community.

 Our
operations and performance depend significantly on global and regional economic conditions and adverse economic conditions can materially
adversely affect our business, results of operations, and financial condition.

 We
are highly susceptible to the global supply chain and any disruptions. The majority of our suppliers and manufacturing facilities are
located outside the U.S. As a result, the Company's operations and performance depend significantly on global and regional economic
conditions.

 Adverse
macroeconomic conditions, including inflation or recession, new or increased tariffs and other barriers to trade, changes to the U.S.
fiscal and monetary policy, tighter credit, higher interest rates, high unemployment, and currency fluctuations can adversely impact
consumer confidence and spending and materially adversely affect demand for our products and services. In addition, consumer confidence
and spending can be materially adversely affected in response to financial market volatility, negative financial news, declines in income
or asset values, energy shortages and cost increases, labor and healthcare costs, and other economic factors. Besides an adverse impact
on demand for our products, uncertainty about, or a decline in, global or regional economic conditions can have a significant impact
on our counteragents including customers, suppliers, contract manufacturers, logistics providers, cellular network carriers, and channel
partners.

 These
and other economic factors can materially adversely affect the Company's business, results of operations, financial condition,
and stock price.

 Economic
uncertainties or downturns, or political changes, could limit the availability of funds available to our customers and potential customers,
which could significantly adversely impact our business.

or future economic uncertainties or downturns could adversely impact our business and operating results. Negative conditions in the general
economy both in the United States and abroad, including conditions resulting from changes in gross domestic product growth, financial
and credit market fluctuations, political deadlock, natural catastrophes, infectious disease outbreaks, and warfare and terrorist attacks
in North America, Europe, the Asia Pacific region or elsewhere, could cause a decrease in funds available to our customers and potential
customers and negatively affect the growth rate of our business.

 These
economic conditions may make it extremely difficult for our customers and us to forecast and plan future budgetary decisions or business
activities accurately, and they could cause our customers to reevaluate their decisions to purchase our solutions, which could delay
and lengthen our sales cycles or result in cancellations of planned purchases. Furthermore, during challenging economic times or as a
result of political changes, our customers may tighten their budgets and face constraints in gaining timely access to sufficient funding
or other credit, which could result in an impairment of their ability to make timely payments to us. In turn, we may be required to increase
our allowance for doubtful accounts, which would adversely impact our financial results.

 We
cannot predict the timing, magnitude or duration of any economic slowdown, instability or recovery, generally or within any particular
industry, or the impact of political changes. If the economic conditions of the general economy or industries in which we operate worsen
from present levels, or if recent political changes result in less funding being available to purchase our solutions, our business, operating
results and financial condition could be adversely impacted.

currency fluctuations may reduce our competitiveness and sales in foreign markets.

 The
relative change in currency values creates fluctuations in product pricing for international customers. These changes in foreign end-customer
costs may result in lost orders and reduce the competitiveness of our products in certain foreign markets. These changes may also negatively
impact the financial condition of some foreign customers and reduce or eliminate their future orders of our products. In addition, a
significant portion of our research and development expenditure takes place in China and India. Fluctuations in the currency values of
those countries could negatively impact our operating expenses.

 Item
1B. Unresolved Staff Comments.

 None.

 Item
1C. Cybersecurity.

 Risk
Management and Strategy

 We
are committed to protecting information and the underlying information systems involved in the functionality of our products and the
operation of our business. We assess, identify, and manage material risks from cybersecurity threats through various processes and procedures,
including:

 (i)

 assessing
 risks, ad hoc, to identify the potential impact and likelihood of various risks and scenarios and to determine appropriate
 mitigation strategies and controls;

 (ii)

 third-party
 manufacturer, partner, and supplier selection processes;

 (iii)

 utilizing
 procedures for responding to cybersecurity incidents;

 (iv)

 training
 our employees, incident response personnel, and senior management on cybersecurity awareness;

 (v)

 monitoring
 the responsibilities of our information technology team and evaluating our cybersecurity posture and performance on an ongoing basis;

 (vi)

 conducting
 regular vulnerability scans and tests utilizing threat intelligence feeds in the assessment of hardware and software; and

 (vii)

 using
 external service providers and other third parties, where appropriate, to assess, test, or otherwise assist with aspects of our systems
 addressing cybersecurity threats.

 Although
we are still in the process of developing a formal incident response plan, our team is trained and had practical experience to cover
all phases of the incident management process, including identification, containment, eradication, recovery, and post-incident analysis.
Significant cybersecurity incidents are elevated within the hierarchy of management and assessed by a cross-functional, executive management-level
team, which is responsible for making the necessary strategic decisions, prioritizing actions that can minimize the impact of the cybersecurity
incidents on us and our customers, and determining the materiality of such incidents.

 In
the past we were subject to attempts to compromise our information technology systems, and, like all information technology systems,
our systems are potentially vulnerable to damage, unauthorized access, or interruption from a variety of sources. As of the date of this
annual report on Form 10-K, we are not aware of any such attacks that have materially affected, or are reasonably likely to materially
affect, us, including our business strategy, results of operations, or financial condition, but we cannot provide assurance that they
will not be materially affected in the future by such risks or any future material incidents. In addition, our third-party service providers
and other partners face similar cybersecurity threats, and although we assess these third parties' cybersecurity controls through
a cybersecurity assessment, which may include a cybersecurity questionnaire depending on our risk evaluation, and include security and
privacy addendums to our contracts where applicable, a cybersecurity incident any of these entities could materially adversely affect
our business and results of operations. For more information on our cybersecurity-related risks, please see "Risks Related to Information
Technology and Intellectual Property" in "Part I. Item 1A. Risk Factors" of this annual report on Form 10-K.

 Corporate
Governance

 Cybersecurity
Risks Oversight by the Members of our Board

 The
Audit Committee has oversight responsibility for risks and incidents relating to cybersecurity threats as a part of its overall risk
oversight responsibilities. Such responsibility includes compliance with disclosure requirements, cooperation with law enforcement, and
analyzing the related effects on financial and other risks, and it reports any findings and recommendations, as appropriate, to the full
board for consideration. The Audit Committee receives annual reports on our cybersecurity risks from management. In addition, management
updates the Audit Committee, as necessary, regarding any material cybersecurity incidents, as well as any incidents with lesser impact
potential.

 Cybersecurity
Risks Oversight by our Management

 Our
management team, including our Head of Information Technology, is responsible for addressing, assessing, and managing our material risks
from cybersecurity threats. Our head of Information Technology supervises both our internal cybersecurity personnel and our retained
external cybersecurity consultants (when applicable). Our management team's experience includes demonstrated expertise in cybersecurity,
mobile and data devices, and smartphone software. Our management team supervises efforts to prevent, detect, mitigate, and remediate
cybersecurity risks and incidents through various means, which may include briefings from internal security personnel; threat intelligence,
and other information obtained from governmental, public, or private sources, including external consultants engaged by us; and alerts
and reports produced by security tools deployed in the information technology environment.

 Item
2. Properties.

 We
maintain our corporate headquarters in a leased facility in San Diego, California. In addition, we lease a facility in Shenzhen, China,
and a facility in Beijing, China for employees that perform engineering and logistics services. We believe that our facilities are suitable
to meet our current needs.

 Item
3. Legal Proceedings.

 For
information regarding our material legal proceedings, see "Note 12. Commitments and Contingencies" in the accompanying "Notes
to Consolidated Financial Statements" in this Annual Report, which information is incorporated herein by reference.

 Item
4. Mine Safety Disclosures.

 Not
applicable.

 PART
II

 Item
5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

 Market
Information

 Our
common stock is traded on The Nasdaq Stock Market LLC under the symbol "SONM."

 Holders
of Record

 As
of March 20, 2024, there were 81 holders of record of our common stock based on information furnished by American Stock Transfer and
Trust Company, LLC, the transfer agent for our securities.

 Dividends

 We
have not declared or paid any cash dividends on our capital stock and do not intend to pay cash dividends in the foreseeable future.
Any future determinations relating to our dividends and earning retention policies will be made at the discretion of our board of directors,
who will review such policies from time to time in light of our earnings, cash flow generation, financial position, results of operations,
the terms of our indebtedness and other contractual restrictions, capital requirements, business prospects and other factors our board
of directors may deem relevant.

 Recent
Sales of Unregistered Securities

 On
October 18, 2023, we issued 230,000 shares of our common stock to a service provider in consideration of consulting services to the Company.

 The
issuances of the above securities were deemed to be exempt from registration under the Securities Act in reliance upon Section 4(a)(2)
of the Securities Act. The service provider described above represented the intention to acquire the securities for investment only and
not with a view to or for sale in connection with any distribution thereof, and appropriate legends were affixed to the share certificates
issued in such transactions.

 Purchase
of Equity Securities

 None

 Item
6. Reserved

 Item
7. Management's Discussion and Analysis of Financial Condition, Results of Operations.

 The
following commentary should be read in conjunction with the Consolidated Financial Statements and related notes thereto contained in
Part IV of this Annual Report on Form 10-K. As discussed in the section titled " Cautionary Note About Forward-Looking
Statements," this discussion contains forward-looking statements based on current expectations that involve risks and uncertainties.
Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including
those set forth under Item 1A.,"Risk Factors," included in Part I of this Annual Report on Form 10-K.

 Company
Overview

 Sonim
Technologies is a leading U.S.-based provider of rugged mobile devices and accessories designed for workers physically engaged in
their work environments, often in mission-critical roles. As part of our expansion efforts, the Company has introduced our Connected
Solutions division which will begin launching products in 2024 in the U.S., Canada and Asia/Pacific. Connected Solutions will
primarily consist of devices that connect to the internet including mobile hotspots, fixed wireless devices and USB dongle devices.
In addition to this, the Company has expanded its rugged phone portfolio by developing a semi-rugged smartphone that is designed for
small businesses through three U.S. carriers beginning in the second half of 2024. The Company is also launching a consumer durable
product in late 2024 to address consumers who need more protection in their devices without sacrificing key design elements and
maintaining an attractive price point. In 2023, the Company sold tablets that connect to the internet to a customer who rebranded
them for sale in the U.S., but such sales have been discontinued in the fourth quarter of 2023.

 Since
June 2023, the Company has received thirteen product awards from U.S., Canadian, and an Australian carrier for products that will launch
in 2024. This includes seven product awards for rugged phones, five product awards for mobile hotspots, and one product award for a consumer
durable smartphone. The thirteen product awards compare to one or two product awards per year that the Company received in years prior
to 2023.

 Revenues
in 2023 were primarily generated from sales of our mobile phones and industrial-grade accessories, predominantly to wireless carriers
in the United States and Canada. We currently have products available at all three U.S. Tier-one carriers – AT&T, T-Mobile
and Verizon as well as the three primary carriers in Canada – Bell, Telus and Rogers. These carriers then resell our products,
along with network services, to end customers focusing on two primary end markets: industrial enterprise and public sector. In 2023 and
2022, tablets were sold to a customer who resold them to a carrier in the U.S. The tablet business was not part of our core business
as it was under the ODM model where we designed a product for a specific customer, and we found a manufacturer to produce the product.
ODM products have lower margins and shorter product lives as compared to our other products.

 Given
our primary sales channels in the U.S. and Canada consist of large wireless carriers, our customer base is somewhat concentrated. For
the year ended December 31, 2023, large wireless carriers contributed 45% of our revenues, with our top three carrier customers accounting
for 40%. Our tablet customer represented 48% of our revenue while smartphones constituted 34% of our revenues and feature phones 17%
of our revenues. To help control and manage the quality, cost and reliability of our supply chain, we directly manage the procurement
of certain final assembly materials used in our products, which include memory and LCDs. To help contain costs and improve the efficiency
of our operations, we have outsourced substantially all of our manufacturing functions, software development and quality control functions
to third parties, transferring the employees who previously performed this work. We continue to develop differentiated products to attract
and retain customers.

 While
we continue to design ultra rugged phones and accessories, we have broadened our product range to appeal to a more diverse audience.
Our core value proposition, which has earned us a loyal following, remains the foundation of our expanded offerings, including rugged
durable phones and wireless data devices. These new products will not only expand our portfolio of products but will also allow the Company
to diversify our customer base into new markets. New product launches for hotspots, our new rugged phone for small businesses, and our
consumer-oriented phone will begin in 2024 and sales are expected to grow over the next few years.

 Our
key value proposition in the market is to incorporate specific elements of our rugged roots into our new products with added durability
without sacrificing attractive design and value pricing. We believe this is an underserved market opportunity in the small business and
consumer spaces. Our expertise in carrier mobility leads us to a natural extension into data devices, where we can leverage our technical
expertise as well as our streamlined organization to bring better quality, better specs, and low cost to the marketplace.

 Recent
Developments

 Recent
Product Awards

 The
first step in selling our products through cell phone carriers is to receive a product award from the carrier. The award documents the
intent of the carrier to carry the proposed product and offer it to customers through their stores or online. The carrier and Sonim agree
to a launch date that is generally nine months or longer from the date of the product award. After the product award, the Company and
its partners complete the design that includes the unique specifications from the carrier, test the device, obtain certification from
the carrier to sell the device, and begin full scale manufacturing of the product based on purchase orders issued by the carrier.

 In
the third quarter of 2023, the Company received five separate product awards for the new hotspot devices that connect users to the internet
through the 4G or 5G phone network. These devices can replace a cable modem at a much lower monthly cost, are portable, and can be used
anywhere that is covered by the 4G or 5G networks. These product awards are from three tier-one carriers in the U.S., one tier-one carrier
in Canada, and one tier-one carrier in Australia. The Company expects to launch the hotspots with different carriers beginning in the
second quarter of 2024, through the fourth quarter of 2024. Incremental revenue and incremental net income are expected once these products
are launched.

 In
the third quarter of 2023 and in the first quarter of 2024, the Company received three product awards for a new rugged smartphone from
U.S. carriers. This phone is sleeker than our ultra-rugged smartphone and will be targeted to small businesses that are exposed to challenging
environments and who want a more durable phone that looks and feels like other consumer phones and has the same great features as other
Android phones. This product is expected to launch in the second half of 2024.

 In
the third quarter of 2023, the Company also received a product award for a value 5G smartphone from a tier-one U.S. carrier. This phone
looks and feels like other consumer phones and has the same great Android features. The differentiator is that it is much more durable
than other phones, and it does not require a separate protective case. This product is expected to launch in the fourth quarter of 2024.

 Closure
of the SEC Investigation with No Enforcement Action

 On
March 6, 2023, we received a letter from the SEC that stated that the SEC has concluded the investigation of the Company and does not
intend to recommend any enforcement action against the Company.

 Liquidity
and Capital Resources

 Currently,
our principal source of liquidity consists of cash and cash equivalents totaling $9.4 million, as of December 31, 2023. During the year
ended December 31, 2023, our net loss was
$0. 1 million and our use of cash in operations was $4.1 million.
Our cash balance is expected to cover any negative cash flow that may be caused by developing new products over the next year. Increased
revenue from new products is expected to increase cash flow in the second half of 2024. We expect to meet all obligations with existing
cash and operating cash flow for a period of at least one year from the date of release of the financial statements included in this
Form 10-K.

 Expansion
into Europe and the Middle East

 In
January 2024, the Bullitt Group Ltd., a competitor of the Company for rugged phones, shutdown. This creates an opportunity for the Company
to sell our existing rugged phones and to develop new rugged phones for customers that were formally served by Bullitt in Europe and
around the world. We are increasing our sales teams for Europe, the Middle East, and Africa and are expanding our service infrastructure
to serve former Bullitt customers. We expect higher sales in Europe in 2024 and in future years.

 Nasdaq
Delisting and Reverse Stock Split

 On
September 14, 2023, we received a letter from Nasdaq notifying us that, because the bid price for our common stock has fallen below $1.00
per share for 30 consecutive business days, we no longer comply with the $1.00 minimum bid price requirement set forth in Nasdaq Listing
Rule set forth in Nasdaq Listing Rule 5550(a)(2) (the "Bid Price Rule") for continued listing. In accordance with Nasdaq
Listing Rule 5810(c)(3)(A), we were provided a period of 180 calendar days, or through March 12, 2024, to regain compliance with the
Bid Price Rule. On March 13, 2024, such period was extended by an additional 180 calendar days,
or through September 9, 2024. To regain compliance, the closing bid price of the Company's
common stock must be at least $1.00 per share for a minimum of ten (10) consecutive business days as required under Nasdaq Listing Rule
5810(c)(3)(A) (unless the Nasdaq staff exercises its discretion to extend this 10-day period pursuant to Nasdaq Listing Rule 5810(c)(3)(H))
during the 180-day period).

 If
the Company does not regain compliance during this second 180-day period, the Nasdaq staff will provide written notice to us that our
common stock is subject to delisting. At that time, we may appeal the delisting determination to a hearings panel pursuant to the procedures
set forth in the applicable Nasdaq Listing Rules. However, there can be no assurance that, if Sonim does appeal the delisting determination
by Nasdaq to the panel, such appeal would be successful.

 This
is not the first instance of Sonim's non-compliance with the Bid Price Rule. We intend to actively monitor the closing bid price
of our common stock and, as appropriate, will consider available options to resolve the deficiency and regain compliance with the Bid
Price Rule, including potentially seeking to effect a reverse share split, if necessary. There can be no assurance that we will be able
to regain compliance with respect to the current deficiency including by effecting a reverse share split, or that we will be able to
maintain compliance with the Nasdaq Capital Market continued listing requirements in the future or regain compliance with respect to
any future deficiencies. In the event we are delisted from Nasdaq, the only established trading market for our common stock would be
eliminated, and we would be forced to list our shares on the OTC Markets or another quotation medium, depending on our ability to meet
the specific listing requirements of those quotation systems. As a result, an investor would likely find it more difficult to trade or
obtain accurate price quotations for our shares. Delisting would likely also reduce the visibility, liquidity, and value of our common
stock, reduce institutional investor interest in our company, and may increase the volatility of our common stock. Delisting could also
cause a loss of confidence of potential industry partners, lenders, and employees, which could further harm our business and our future
prospects.

 Macroeconomic
Events

the fiscal year 2023, we operated under challenging market conditions, influenced by global events beyond our control such as inflation,
supply chain disruptions, tensions between the U.S. and China, war in Ukraine, the overall international instability, and other events
discussed in "Part I. Item 1A. Risk Factors" in this Form 10-K. We have implemented and continue to implement measures to
address those challenges. We also continue to actively manage our inventory and establish a relationship with third-party manufacturers
in an effort to minimize supply chain disruptions. Nevertheless, the above-described events had and will continue to impact the global
macroeconomic and geopolitical environments, capital and commodity markets, and global supply chains, which may have an adverse impact
on our operations and hinder our ability to access capital, if needed. Our cost of revenue may increase if the component prices increase.

 Key
Metrics

 We
review a variety of key financial metrics to help us evaluate growth trends, establish budgets, measure the effectiveness of our business
strategies and assess operational efficiencies.

 Units
Sold

 Our
smartphones include the XP10 model sold in 2023 and 2022, and our XP8 model sold in 2022. The number of smartphone units sold during
the year ended December 31, 2023 compared to the year ended December 31, 2022 increased by 89%, primarily because the XP10 was launched
in November 2022 and had a full year of sales in 2023. The Company's tablet sales increased by 52% in 2023 as compared to 2022
because the tablet was launched in the third quarter of 2022, and 2023 had nine months of tablet sales. We stopped selling the tablet
in October, 2023. Our feature phones include the XP3plus, XP3, XP5, XP5s, and XP5plus models. The number of feature phone units sold
during the year ended December 31, 2023 compared to the year ended December 31, 2022 decreased by 32%, primarily because 2022 had higher
sales of the XP3plus after it was launched in September 2021.

 Set
forth below is units sold by product category (in thousands):

 Year Ended December 31,

 2023

 2022

 Smartphones

 Feature phones

 Tablets and other

 Total Units Sold

 Adjusted
EBITDA

 In
addition to our financial results determined in accordance with U.S. GAAP, we believe the following non-GAAP and operational measures
are useful in evaluating our performance-related metrics.

 Set
forth below is a reconciliation from net loss to Adjusted EBITDA (in thousands):

 Year Ended December 31,

 2023

 2022

 Net loss

 $
 (90
)

 $
 (14,087
)

 Depreciation and amortization

 2,206

 2,375

 Stock-based compensation

 1,496

 1,551

 Interest expense

 Income taxes

 Adjusted EBITDA

 $
 4,001

 $
 (9,880
)

 We
define Adjusted EBITDA as net loss adjusted to exclude the impact of stock-based compensation expense, depreciation and amortization,
interest expense, and income taxes. Adjusted EBITDA is a useful financial metric in assessing our operating performance from period to
period by excluding certain items that we believe are not representative of our core business, such as certain material non-cash items
and other adjustments, such as stock-based compensation.

 We
believe that Adjusted EBITDA, viewed in addition to, and not in lieu of, our reported GAAP results, provides useful information to investors
regarding our performance and overall results of operations for various reasons, including:

 non-cash
 equity grants made to employees at a certain price do not necessarily reflect the performance of our business at such time, and as
 such, stock-based compensation expense is not a key measure of our operating performance; and

 non-cash
 depreciation and amortization are not considered a key measure of our operating performance.

 We
use Adjusted EBITDA:

 as
 a measure of operating performance;

 for
 planning purposes, including the preparation of budgets and forecasts;

 to
 allocate resources to enhance the financial performance of our business;

 to
 evaluate the effectiveness of our business strategies;

 in
 communications with our board of directors concerning our financial performance; and

 as
 a consideration in determining compensation for certain key employees.

 Adjusted
EBITDA has limitations as analytical tools, and should not be considered in isolation, or as a substitute for analysis of our results
as reported under GAAP. Some of these limitations include:

 it
 does not reflect all cash expenditures, future requirements for capital expenditures or contractual commitments;

 it
 does not reflect changes in, or cash requirements for, working capital needs;

 it
 does not reflect interest expense on our debt or the cash requirements necessary to service interest or principal payments; and

 other
 companies in our industry may define and/or calculate this metric differently than we do, limiting its usefulness as a comparative
 measure.

 Factors
Affecting Our Results of Operations

 We
believe that the growth and future success of our business depend on many factors. While these factors present significant opportunities
for our business, they also pose important challenges that we must successfully address to improve our results of operations.

and Development

 We
believe that our performance is significantly dependent on the investments we make in research and development and that we must continue
to develop and introduce innovative new products on a two- to three-year cycle. Our partnerships with ODMs are expected to enable us
to shift between different types and numbers of devices under development while increasing the size of our internal team at a slower
pace than our growth in revenue.

 While
the hardware design of our phones is generally the same for all wireless carriers, each device must be configured to conform to the requirements
of each wireless carrier's network, resulting in higher development expenses as the number of wireless carriers we sell through
increases. In addition to the design and configuration costs, each device must undergo a multi-month technical approval process at each
carrier before it can be certified to be stocked at each carrier. The approval process for each device for each carrier has historically
cost between $1 million and $3 million. We capitalize these certification costs as contract fulfillment assets and amortize them over
the estimated life of the product. Prior to the commencement of development of a product for certification, we generally do not receive
any purchase orders or commitments. Following a carrier's review of product concepts, we may receive a product award letter from
that carrier to move forward with the development and certification process, at which time we may begin receiving advance purchase orders
or commitments. Since the timing of when we seek technical approval with our wireless carriers tends to be cyclical in nature, quarter-over-quarter
expenditures may vary significantly depending on the number of approvals in process during the quarter. If we fail to innovate and enhance
our product offerings, our brand, market position and revenues may be adversely affected. If our research and development efforts are
not successful, then we will not recover these investments that we make.

 New
Customer Acquisitions

 We
are focused on continuing to acquire new customers, in North America, Europe, the Middle East, and Australia, to support our long-term
growth. Historically, we have been dependent on a small number of wireless carriers distributing our products. We have invested, and
expect to continue to invest, in our sales and marketing efforts to drive new customer acquisitions. We are currently pursuing former
customers of Bullitt in Europe and the Middle East to introduce our rugged phone products. A key part of our strategy is to further expand
our connected solutions products. We also intend to continue to invest in and expand our international sales teams. As a result, we expect
our sales and marketing costs to increase as we seek to acquire new customers. Sales and marketing investments will often occur in advance
of any sales benefits from these activities, and it may be difficult for us to determine if we are efficiently allocating our sales and
marketing resources.

 Seasonality
and New Product Introduction

 We
have historically experienced lower net revenue in our first quarter compared to other quarters in our fiscal year due to seasonal demand
associated with the introduction of new products to our lead customers. New product introductions can significantly impact net revenue,
gross profit and operating expenses. The timing of product introductions can also impact our net revenue as our wireless carrier customers
prepare for a new product launch, and channel inventory of an older product often declines as the launch of a newer product approaches.
Net revenue can also be affected when consumers and distributors anticipate a new product introduction. However, neither historical seasonal
patterns nor historical patterns of product or service introductions should be considered reliable indicators of our future pattern of
product or service introductions, future net sales or financial performance.

 Components
of Our Results of Operations

 The
following describes the line items set forth in our consolidated statements of operations.

 Revenues

 Revenues
are recognized on the date that the customer receives the products sold or when title is passed to the customer upon shipment. For products
shipped on consignment, revenue is not recognized until the products are sold to the end customer. Any discounts, marketing development
funds, product returns or other revenue reductions are treated as offsets to revenues, which is presented on a net basis. A return reserve
reduces revenue for products that are sold to distributors with a right of return. We have also historically entered into customer agreements
with channel partners that include a combination of products and non-recurring engineering services, or NRE services. When a customer
agreement includes NRE services which involve significant design modification and customization of the product software that is essential
to the functionality of the hardware, revenues are also recognized as control transfers to the customer under Accounting Standards Codification
("ASC") 606, Revenue from Contracts with Customers. All of our revenues are derived from a single segment.

 The
Company recognizes revenue primarily from the sale of products, including our mobile phones, connected devices, tablets, and accessories,
and most of the Company's contracts include only one performance obligation, namely the delivery of product. A performance obligation
is a commitment in a contract to transfer a distinct good or service to the customer and is defined as the unit of account for revenue
recognition under ASC 606. The Company also recognizes revenue from other contracts that may include a combination of products and NRE
services or from the provision of solely NRE services. Where there is a combination of products and NRE services, the Company accounts
for the commitments as individual performance obligations if they are both capable of being distinct and are distinct within the context
of the contract.

 Our
customer agreements with channel partners set forth the terms pursuant to which our channel partners purchase our products for distribution
on a purchase order basis. While these arrangements are typically long term, they generally do not contain any firm purchase volume commitments.
As a result, our channel partners are not contractually obligated to purchase from us any minimum number of products. However, while
our channel partners provide us with demand forecasts under these sales arrangements, we are generally required to satisfy any and all
purchase orders delivered to us within specified delivery windows, with limited exceptions (such as orders significantly in excess of
forecasts). Our sales arrangements also generally include technical performance standards for our mobile phones and accessories sold,
which vary by channel partner. If a technical issue with any of our covered products exceeds certain preset failure thresholds for the
relevant performance standard or standards, the channel partner typically has the right to cease selling the product, cancel open purchase
orders and levy certain monetary penalties. In addition, our channel partners retain sole discretion in which of their stocked products
to offer their customers.

 We
also offer our channel partners channel marketing and other limited promotional incentives, such as sales volume incentives, in exchange
for retail price reductions. Under certain of our customer agreements, we may also offer NRE services in the form of third-party design
services relating to the design of materials and software licenses used in the manufacturing of our products.

 Our
tablet sales were with a customer that imported the tablets to the U.S., where the tablets were branded, and sold to a U.S. retailer.
Tablet sales ended in October 2023 and are not expected to be resumed in 2024.

 Cost
of Revenues and Gross Profit/Gross Margin

 Cost
of revenues for products manufactured by third parties is the negotiated price that the Company pays for the products. Cost of revenues
includes other direct costs related to the final product to the customer, including such items as shipping costs, royalties on third-party
technology included in the product, warranty cost accruals, supply chain costs, logistics costs, and packaging and handling costs.

 Amortization
of NRE expenses and contract fulfillment costs are part of cost of revenues. Gross profit is defined as revenues less cost of revenues.
Gross margin is gross profit expressed as a percentage of revenues. We expect that our gross margin may fluctuate from period to period,
primarily because of changes in average selling price, changes in the price that we pay for inventory, revenue mix among our devices,
and shipping costs. In addition, we may reserve against the value at which we carry our inventory based upon the device's lifecycle
and conditions in the markets in which we sell.

 Operating
Expenses

 Our
operating expenses consist of the following categories:

and development. Research and development expenses consist primarily of personnel-related expenses, including salaries, bonuses, stock-based
compensation and employee benefits, as well as outsourced costs incurred through our ODM partnerships and other third parties. Research
and development expenses also include the costs of developing new products and supporting existing products. Research and development
activities include the design of new products, refinement of existing products and design of test methodologies to ensure compliance
with required specifications. We consider costs associated with achieving technical acceptance with each product at each carrier to be
a contract fulfillment cost that we capitalize. We expect our research and development expenses to fluctuate over time as we experience
the various product cycles of our devices.

 Sales
and marketing. Sales expenses consist primarily of personnel-related expenses, including salaries, bonuses, stock-based compensation,
commissions to sales representatives, travel costs and employee benefits, as well as field support and customer training costs. Marketing
expenses include all social media and collateral print media, and brand development expenses.

and administrative. General and administrative expenses consist primarily of personnel-related expenses, including salaries, bonuses,
stock-based compensation, travel costs and employee benefits, as well as professional and consulting fees, legal fees, and insurance
costs.

taxes. As part of the process of preparing our consolidated financial statements we are required to estimate our taxes in each of the
jurisdictions in which we operate. We account for income taxes in accordance with the asset and liability method. Under this method,
deferred tax assets and liabilities are recognized based on temporary differences between the financial reporting and income tax bases
of assets and liabilities and the tax effects of net operating loss and credit carryforwards using the enacted tax rates expected to
apply in the periods of expected settlement. In addition, this method requires a valuation allowance against net deferred tax assets
if, based upon the available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.

 Results
of Operations

 Years
Ended December 31, 2023 and 2022:

 The
following tables present key components of our results of operations for the respective periods (in thousands):

 Year
 Ended December 31,

 2023
 vs 2022

 2023

 2022

 Increase
 (Decrease)

 %

 Net
 revenues

 $

 $

 $
 23,804

 34.1
 %

 Cost
 of revenues

 74,308

 58,205

 16,103

 27.7
 %

 Gross
 profit

 19,324

 11,623

 7,701

 66.3
 %

 Operating
 expenses:

 and development

 1,772

 7,973

 (6,201
)

 -77.8
 %

 Sales
 and marketing

 8,768

 7,274

 1,494

 20.5
 %

 and administrative

 8,271

 10,666

 (2,395
)

 -22.5
 %

 Total
 operating expenses

 18,811

 25,913

 (7,102
)

 -27.4
 %

 Net
 income (loss) from operations

 (14,290
)

 14,803

 -103.6
 %

 Interest
 expense

 (15
)

 (97
)

 -84.5
 %

 Other
 income (expense), net

 (214
)

 (698
)

 -144.2
 %

 Net
 income (loss) before income taxes

 (13,903
)

 14,187

 -102.0
 %

 tax expense

 (374
)

 (184
)

 (190
)

 103.3
 %

 Net
 loss

 $
 (90
)

 $
 (14,087
)

 $
 13,997

 -99.4
 %

 Net
revenues. Net revenues for the year ended December 31, 2023, increased by $23.8 million, or 34.1% to $93.6 million compared to $69.8
million for the year ended December 31, 2022. The increase in net revenues was primarily due to an increase in smartphone sales of $13.6
million and tablet sales of $15.3 million, partially offset by a decrease in feature phone sales. Tablet sales stopped in October 2023
with the end of the product's life cycle. We expanded our product portfolio with two low-cost smartphones that were developed through
our ODM model and started shipping in December 2023, which contributed $0.4 million in revenue in 2023. We have thirteen new product
awards, five for mobile hotspots, seven for new rugged phones, and one for a new consumer durable phone. These products are all expected
to launch in 2024, and will result in higher revenue in the second half of 2024 and in future years.

 Cost
of revenues. Total cost of revenues for the year ended December 31, 2023, increased $16.1 million, or 27.7%, to $74.3 million, or
79.4% of net revenues, compared to $58.2 million, or 83.4% of net revenues for the year ended December 31, 2022. This increase was attributable
to the increase in net revenues. The lower cost of revenues as a percentage of net revenues in 2023 was due to sales mix and specifically
the sale of relatively higher margin smartphones in 2023.

 Gross
profit and margin. Gross profit for the year ended December 31, 2023, increased $7.7 million, or 66.3%, to $19.3 million, or 20.6%
of net revenues, from $11.6 million, or 16.6% of net revenues for the year ended December 31, 2022. This increase in gross profit was
primarily due to higher revenue from smartphone and tablet sales. Gross profit margins reflected a more favorable product mix due to
increased sales of the refreshed XP10 rugged smartphone.

and development. Research and development ("R&D") expenses for the year ended December 31, 2023, decreased by $6.2
million, or 77.8%, to $1.8 million compared to $8.0 million for the year ended December 31, 2022. The decrease was due to 2022 including
R&D on the XP10 and the XP5plus that were launched in 2022. R&D expense in 2023 included spending on the new mobile hotspots,
and two new smartphones that will launch in 2024.

 Sales
and marketing. Sales and marketing expenses for the year ended December 31, 2023, increased by $1.5 million, or 20.5%, to $8.8 million
compared to $7.3 million for the year ended December 31, 2022. This increase is due to the hiring of new personnel to drive the Company's
expansion into data devices, and the expansion of the sales team to serve Europe, the Middle East and Australia.

and administrative. General and administrative expenses for the year ended December 31, 2023, decreased by $2.4 million, or 22.5%,
to $8.3 million compared to $10.7 million for the year ended December 31, 2022. This decrease was primarily due to severance costs of
$1.2 million incurred in 2022 due to a change in the management team, a decrease in finance headcount, and lower directors and officers
insurance costs.

 Interest
expense. Interest expense is less than $0.1 million in both years because the Company had minimal debt.

 Other
income (expense), net. Other income (expense), net, decreased by $0.7 million primarily because 2022 had a $0.7 million gain on the
termination of the San Mateo office lease.

tax expense. We recognized an income tax provision of $0.4 million in 2023 as compared to $0.2 million in 2022. This increase in
tax expense in 2023 is primarily due to the Company's increase in foreign tax expense for its foreign subsidiaries in 2023 as compared
to 2022.

 Net
loss. The net loss for December 31, 2023, was $0.1 million compared to $14.1 million for December 31, 2022. This $14.0 million improvement
is primarily due to a $7.7 million increase in gross profit due to higher revenue, a $6.2 million decrease in R&D expenses, and a
$2.4 million decrease in General and Administrative expenses, partially offset by a $1.5 million increase in Sales and Marketing expenses.

 Adjusted
EBITDA. Adjusted EBITDA was $4.0 million for the year ended December 31, 2023, compared to negative $9.9 million for the year ended
December 31, 2022. This improvement was primarily due to the same factors in the improvement to Net Loss.

 Liquidity
and Capital Resources

 Historically,
we have funded operations from a combination of public and private equity financings, convertible loans from existing investors and borrowings
under loan agreements. As of December 31, 2023, we did not have any convertible loans or any other borrowing structures in place.

 Currently,
our principal source of liquidity consists of cash and cash equivalents totaling $9.4 million as of December 31, 2023. During the year
ended December 31, 2023, our net loss was $0.1 million. In 2024 we will be launching new products beginning in the second quarter, and
these new products are expected to incrementally improve cash flow. In 2024, we will continue to use cash to complete the certification
of our new products with the carriers, to develop new products, and to expand our sales and marketing teams in Europe, the Middle East,
and Australia. We will adjust our spending to ensure that our cash is sufficient to cover any future negative cash flow.

 Our
management is currently evaluating various funding alternatives and may seek to raise additional funds through the issuance of equity,
mezzanine or debt securities, or through arrangements with strategic or investment partners with greater resources or access to funds,
or through obtaining credit from government or financial institutions. As we seek additional sources of financing, there can be no assurance
that such financing would be available to us on favorable terms or at all. Our ability to obtain additional financing in the debt and
equity capital markets is subject to several factors, including market and economic conditions, our performance and investor sentiment
with respect to us and our industry. The shares of our common stock offered for resale pursuant to the Form S-3 Registration Statement
and Prospectus, dated December 1, 2023, represented approximately 48.4% of the outstanding shares of our common stock as of December
31, 2023, and approximately 99% of our public float. Given the substantial number of shares of our common stock registered for resale,
the perception in the market that the selling securityholders of a large number of shares intend to sell shares could increase the volatility
of the market price of our common stock or result in a significant decline in the public trading price of our common stock and hinder
our efforts to address our capital needs by means of the sale of our securities.

 Cash
Flows

 The
following table summarizes our sources and uses of cash for the periods presented (in thousands):

 Year
 Ended December 31,

 2023

 2022

 Net
 cash used in operating activities

 $
 (4,052
)

 $
 (12,360
)

 Net
 cash used in investing activities

 (36
)

 (8
)

 Net
 cash provided by financing activities

 14,348

 Cash
flows from operating activities

 For
the year ended December 31, 2023, cash used in operating activities was $4.1 million. Non-cash charges were $4.3 million and changes
in operating assets and liabilities were a net use of $8.3 million. Non-cash charges primarily consisted of $2.2 million in depreciation
and amortization, $1.5 million in stock-based compensation, $0.4 million in payment for services with common stock, partially offset
by non-cash lease liability amortization. The changes in our net operating assets and liabilities were primarily due to an increase in
contract fulfillment assets of $4.5 from the capitalization of certification costs, an increase of $3.0 million in accounts receivable
due to the timing of sales at year-end, and an increase of $2.6 million in inventory due to the timing of shipments at year-end. These
cash decreases were partially offset by a decrease of $1.3 million in non-trade receivables due to the timing of parts deliveries to
our manufacturers.

 For
the year ended December 31, 2022, cash used in operating activities was $12.4 million, primarily attributable to a net loss of $14.1
million. Non-cash charges were $1.3 million and changes in operating assets and liabilities were $0.2 million. Non-cash charges primarily
consisted of $1.5 million in stock-based compensation, $0.5 million in payment for services with common stock, partially offset by non-cash
lease liability amortization, and $0.7 million in a non-cash gain on the termination of a lease. The changes in our net operating assets
and liabilities were primarily due to an increase of $11.7 million in accounts payable due to amounts payable to the tablet vendors,
a decrease in prepaid expenses of $3.5 million due to the release of prepaid taxes, deposits for manufacturing inventory and prepaid
NRE, and a decrease in inventory of $1.3 million. These were partially offset by a $11.3 million increase in accounts receivable from
the tablet customer, an increase in capitalized contract fulfillment costs of $4.8 million, and a decrease in accrued expenses of $1.1
million.

 Cash
flows from investing activities

 For
the years ended December 31, 2023 and 2022, cash used in investing activities was less than $0.1 million each year.

 Cash
flows from financing activities

 For
the year ended December 31, 2023, cash provided by financing activities was $0.3 million, primarily due to $0.4 million in proceeds from
the exercise of stock options, partially offset by $0.1 million for the repayment of debt.

 For
the year ended December 31, 2022, cash provided by financing activities was $14.3 million, primarily due to proceeds from the AJP transaction
(see Note 9).

 Material
Cash Requirements

 We
had approximately $13.5 million in noncancelable purchase orders for inventory and other operating expenses as of December 31, 2023.
We anticipate the source of funds to meet these obligations to be existing cash and future product sales.

 Critical
Accounting Policies and Estimates

 Our
discussion and analysis of financial condition and results of operations is based upon our consolidated financial statements, which have
been prepared in conformity with accounting principles generally accepted in the United States of America. Certain accounting policies
and estimates are particularly important to the understanding of our financial position and results of operations and require the application
of significant judgment by our management or can be materially affected by changes from period to period in economic factors or conditions
that are outside of our control. As a result, they are subject to an inherent degree of uncertainty. In applying these policies, management
uses their judgment to determine the appropriate assumptions to be used in the determination of certain estimates. Those estimates are
based on our historical operations, our future business plans and projected financial results, the terms of existing contracts, our observance
of trends in the industry, information provided by our customers and information available from other outside sources, as appropriate.

Fulfillment Assets and Amortization

 The
Company determined that the NRE technical approval costs and the NRE field test costs are contract fulfillment costs and recognizes the
associated NRE asset as these costs are incurred. The Company tracks the NRE assets by product and customer, then amortizes the NRE assets
to Cost of Revenues over a period of four years, which is management's estimated average product life for each model phone, starting
from the date of the first significant sales.

 Recently
Accounting Pronouncements

 In
June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial
Instruments, which requires measurement and recognition of expected credit losses for financial assets held. This guidance is effective
for interim and annual periods beginning after December 15, 2022. The adoption of this pronouncement did not have a material impact on
the Company's consolidated financial statements and resulted in additional disclosures only.

 Item
7A. Quantitative and Qualitative Item Disclosures About Market Risk.

 We
are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information under this
item.

 Item
8. Financial Statements and Supplementary Data

 The
following consolidated financial statements of Sonim Technologies, Inc., and the independent registered public accounting firm's
report are incorporated by reference from Part IV, Item 15(1) and (2):

 Report of Independent Registered Public Accounting Firm (Moss Adams LLP, Campbell, California, PCAOB ID: 659)

 Consolidated Balance Sheets – At December 31, 2023 and 2022

 Consolidated Statements of Operations – Years Ended December 31, 2023 and 2022

 Consolidated Statements of Stockholders' Equity – Years Ended December 31, 2023 and 2022

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

 Notes to the Consolidated Financial Statements

 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

 Our
management, with the participation of our principal executive officer and principal financial officer, has evaluated the effectiveness
of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, prior to filing this Annual
Report on Form 10-K. Based on this evaluation, our principal executive officer and principal financial officer concluded that, as of
the end of the period covered by this Annual Report on Form 10-K, our disclosure controls and procedures were effective at the reasonable
assurance level.

 Limitations
on Effectiveness of Controls and Procedures

 In
designing and evaluating disclosure controls and procedures, our management recognizes that any system of controls, however well designed
and operated, can provide only reasonable assurance, and not absolute assurance, that the desired control objectives of the system are
met. In addition, the design of any control system is based in part upon certain assumptions about the likelihood of future events. Because
of these and other inherent limitations of control systems, there can be no assurance that any design will succeed in achieving its stated
goals in all future circumstances. Accordingly, our disclosure controls and procedures are designed to provide reasonable, not absolute,
assurance that the objectives of our disclosure control system are met.

 Management's
Report on Internal Control over Financial Reporting

 Our
management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined
in Rule 13a-15(f) of the Exchange Act. Our management has assessed the effectiveness of our internal control over financial reporting
as of December 31, 2023, using the criteria established in "Internal Control—Integrated Framework" (2013), issued by
the Committee of Sponsoring Organizations of the Treadway Commission, or COSO. Based on that assessment, our management has concluded
that the Company's internal control over financial reporting was effective as of December 31, 2023.

 Remediation
of Previously Identified Material Weaknesses in Internal Control

 For the year ended December 31, 2022, we identified a material weakness
in our internal controls over financial reporting related to the design and implementation of our IT general controls including a failure
to document reviews of changes to user roles in our financial reporting systems and subsystems. During 2023, we fully implemented additional
control procedures over changes to user roles in our financial reporting systems and subsystems and have operated effectively for a sufficient
period of time to conclude that the previously identified material weakness has been remediated.

 Attestation
Report of Registered Public Accounting Firm

 This
annual report does not include an attestation report of our registered public accounting firm on our internal control over financial
reporting due to an exemption established for "emerging growth companies" under the Jumpstart Our Business Startups (JOBS)
Act.

in Internal Control Over Financial Reporting

 Except
as otherwise disclosed, there was no change in our internal control over financial reporting that occurred during the fourth quarter
ended December 31, 2023 that has materially affected, or is reasonably likely to materially affect, our internal control over financial
reporting.

 Item
9B. Other Information.

 None.

 Item
9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.

 Not
applicable.

 PART
III

 Item
10. Directors, Executive Officers and Corporate Governance.

 We
have adopted a Code of Business Conduct and Ethics, or the Code of Conduct, applicable to all of our employees, executive officers, and
directors. The Code of Conduct is available on our website at www.sonimtech.com. The Nominating and Corporate Governance Committee of
our Board of Directors will be responsible for overseeing the Code of Conduct and must approve any waivers of the Code of Conduct for
employees, executive officers, and directors. We expect that any amendments to the Code of Conduct, or any waivers of its requirements,
will be disclosed on our website.

 The
additional information required by this Item 10 will either be (i) included in an amendment to this Annual Report on Form 10-K, or (ii)
incorporated by reference from our definitive proxy statement to be filed not later than 120 days after the end of our 2023 fiscal year.

 Item
11. Executive Compensation.

 The
information required by this Item 11 will either be (i) included in an amendment to this Annual Report on Form 10-K, or (ii) incorporated
by reference from our definitive proxy statement for the 2024 annual meeting of stockholders, in either case to be filed not later than
120 days after the end of our 2023 fiscal year.

 Item
12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.

 The
information required by this Item 12 will either be (i) included in an amendment to this Annual Report on Form 10-K, or (ii) incorporated
by reference from our definitive proxy statement for the 2024 annual meeting of stockholders, in either case to be filed not later than
120 days after the end of our 2023 fiscal year.

 Item
13. Certain Relationships and Related Transactions, and Director Independence.

 The
information required by this Item 13 will either be (i) included in an amendment to this Annual Report on Form 10-K, or (ii) incorporated
by reference from our definitive proxy statement for the 2024 annual meeting of stockholders, in either case to be filed not later than
120 days after the end of our 2023 fiscal year.

 Item
14. Principal Accountant Fees and Services.

 The
information required by this Item 14 will either be (i) included in an amendment to this Annual Report on Form 10-K, or (ii) incorporated
by reference from our definitive proxy statement for the 2024 annual meeting of stockholders, in either case to be filed not later than
120 days after the end of our 2023 fiscal year.

 PART
IV

 Item
15. Exhibit and Financial Statement Schedules.

 The
following documents are filed as part of this report:

 1.

 Statements. The following - consolidated financial statements and related documents are filed as part of this report:

 Statements

 Page

 Report of Independent Registered Public Accounting Firm

 Consolidated Balance Sheets – At December 31, 2023 and 2022

 Consolidated Statements of Operations – Years Ended December 31, 2023 and 2022

 Consolidated Statements of Stockholders' Equity – Years Ended December 31, 2023 and 2022

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

 Notes to the Consolidated Financial Statements

 to F-27

 2.

 Statement Schedules. Schedules are omitted because they are not required or applicable, or the required information is included
 in the Financial Statements or related notes.

 3.

 Exhibits.
 The Exhibits listed in the accompanying Exhibit Index are filed or incorporated by reference as part of, or furnished with, this
 report.

 Exhibit

 Incorporation
 by Reference

 Exhibit

 Number

 Exhibit
 Description

 Form

 File
 No.

 Exhibit

 Filing
 Date

 3.1

 Amended
 and Restated Certificate of Incorporation of the Registrant

 3.1

 May
 17, 2019

 3.2

 Certificate
 of Amendment to the Amended and Restated Certificate of Incorporation

 3.1

 September
 15, 2021

 3.3

 Amended
 and Restated Bylaws of the Registrant

 3.1

 November
 8, 2021

 4.1

 Form
 of Common Stock Certificate of the Registrant

 S-1/A

 333-230887

 4.1

 April
 29, 2019

 4.2

 Description
 of the Registrant's Securities

 4.4

 March
 27, 2020

 10.1

 2012
 Equity Incentive Plan and forms of agreements thereunder

 S-1

 333-230887

 10.1

 April
 15, 2019

 10.2

 Sonim
 Technologies, Inc. 2019 Equity Incentive Plan, as amended and restated as of September 28, 2023

 10.1

 September
 28, 2023

 10.3

 2019
 Employee Stock Purchase Plan

 S-1/A

 333-230887

 10.3

 April
 29, 2019

 10.4

 Form
 of Indemnification Agreement, by and between the Registrant and each of its directors and executive officers

 S-1

 333-230887

 10.4

 April
 15, 2019

 10.5+

 Frame
 Purchase Agreement dated December 18, 2020 by and between Sonim Technologies, Inc. and Dongguan Unicair Communication Technology
 Co. Ltd.

 10.1

 18, 2020

 10.6+

 Asset
 Purchase & Employee Transfer Agreement dated December 22, 2020 by and among Sonim Technologies (India) Private Limited and Coforge
 Ltd.

 10.1

 29, 2020

 10.7+

 ODM
 Services Agreement dated February 26, 2021 by and among Sonim Technologies, Inc. and FIH (Hong Kong) Limited

 10.1

 March
 4, 2021

 10.8 *

 Non-Employee Director Compensation Policy dated as of January 1, 2024

 10.9+

 Subscription
 Agreement, dated as of April 13, 2022, by and between Sonim Technologies, Inc. and AJP Holding Company, LLC

 10.1

 April
 14, 2022

 10.10

 Retention
 and Separation Agreement, dated as of April 13, 2022, by and between Sonim Technologies, Inc. and Robert Tirva

 10.16

 May
 2, 2022

 10.11

 Release
 Agreement dated as of July 13, 2022, by and between Sonim Technologies, Inc. and Robert Tirva

 10.3

 July
 13, 2022

 10.12 +

 Amended
 and restated letter agreement, dated as of December 8, 2023, by and between Sonim Technologies, Inc. and Clay Crolius

 10.2

 11, 2023

 10.13

 Registration
 Rights Agreement, dated as of July 13, 2022, by and between Sonim Technologies, Inc. and AJP Holding Company, LLC

 10.5

 July
 13, 2022

 10.14 +

 Amended
 and restated letter agreement, dated as of December 8, 2023, by and between Sonim Technologies, Inc. and Hao (Peter) Liu

 10.1

 11, 2023

 10.15

 Employment
 Agreement, dated as of August 23, 2022, by and between Sonim Technologies, Inc. and Charles Becher

 10-K/A

 10.19

 May
 1, 2023

 10.16

 Consulting
 Agreement by and between the Company and Alan Howe dated as of August 8, 2023

 10.1

 August
 9, 2023

 21.1

 Subsidiaries
 of the Registrant

 21.1

 March
 20, 2023

 23.1*

 Consent of Independent Registered Public Accounting Firm

 31.1*

 Certification of Principal Executive Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

 31.2*

 Certification of Principal Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

 32.1**

 Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as Adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

 32.2**

 Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as Adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

 97.1*

 Sonim Technologies, Inc. Clawback Policy for Incentive-based Compensation effective as of October 2, 2023

 101.INS*

 101.SCH*

 101.CAL*

 101.DEF*

 101.LAB*

 101.PRE*

 104*

 Cover

 *

 Filed
 herewith

 **

 Furnished
 herewith

 Indicates
 a management contract or compensatory plan or arrangement

 +

 Schedules
 and certain portions of this exhibit have been omitted pursuant to Item 601(a)(5) and Item 601(b)(10)(iv) of Regulation S-K

 Item
16. Form 10-K Summary

 None

 SIGNATURES

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

 Sonim
 Technologies, Inc.

 Date
 March 27, 2024

 By:

 /s/
 Clay Crolius

 Clay
 Crolius

 Chief
 Financial Officer

 (Principal
 Financial and Accounting Officer)

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

 Signature

 Title

 Date

 /s/
 Hao Liu

 Chief
 Executive Officer and Director

 March

 Hao
 (Peter) Liu

 ( Principal
 Executive Officer)

 /s/
 Clay Crolius

 Chief
 Financial Officer

 March

 Clay
 Crolius

 ( Principal
 Financial and Accounting Officer)

 /s/
 Mike Mulica

 Chairman
 of the Board and Director

 March

 Mike
 Mulica

 /s/
 Jeffrey Wang

 March

 Jeffrey
 Wang

 /s/
 Jack Steenstra

 March

 Jack
 Steenstra

 /s/
 James Cassano

 March

 James
 Cassano

 Report
of Independent Registered Public Accounting Firm

 To
the Shareholders and the Board of Directors

 Sonim
Technologies, Inc.

 Opinion
on the Financial Statements

 We
have audited the accompanying consolidated balance sheets of Sonim Technologies, 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, the consolidated
financial statements present fairly, in all material respects, the consolidated financial position of the Company as of December 31,
2023 and 2022, and the consolidated results of its operations and its cash flows for the years then ended, in conformity with accounting
principles generally accepted in the United States of America.

 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 to 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/
 Moss Adams LLP

 Campbell,
 California

 March

 We
have served as the Company's auditor since 2013

 F- 1

 SONIM

 CONSOLIDATED
BALANCE SHEETS

 DECEMBER
31, 2023 and 2022

 (IN
THOUSANDS EXCEPT SHARE AND PER SHARE AMOUNTS)

 31,
 2023

 31,
 2022

 Assets

 Cash
 and cash equivalents

 $
 9,397

 $
 13,213

 receivable, net

 25,304

 22,433

 Non-trade
 receivable

 2,269

 Inventory

 6,517

 3,910

 expenses and other current assets

 1,608

 1,807

 Total
 current assets

 43,787

 43,632

 and equipment, net

 Right-of-use
 assets

 fulfillment assets

 9,232

 6,848

 Other
 assets

 2,898

 2,972

 Total
 assets

 $
 56,043

 $
 53,686

 Liabilities
 and stockholders' equity

 portion of long-term debt

 $
 —

 $

 payable

 19,847

 21,126

 Accrued
 liabilities

 12,233

 10,692

 portion of lease liability

 revenue

 Total
 current liabilities

 32,147

 32,062

 tax payable

 1,528

 1,429

 Accrued
 severance

 —

 Total
 liabilities

 33,675

 33,641

 Commitments
 and contingencies (Note 12)

 -

 -

 Stockholders'
 equity

 Common
 stock, $ 0.001 par value per share; 100,000,000 shares authorized: and 43,081,083 and 40,774,687 shares issued and outstanding at
 December 31, 2023 and 2022, respectively

 Preferred
 stock, $ 0.001 par value per share, 5,000,000 shares authorized: and no shares issued and outstanding at December 31, 2023 and 2022,
 respectively

 —

 —

 Additional
 paid-in capital

 272,285

 269,874

 Accumulated
 deficit

 ( 249,960
)

 ( 249,870
)

 Total
 stockholders' equity

 22,368

 20,045

 Total
 liabilities and stockholders' equity

 $
 56,043

 $
 53,686

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

 F- 2

 SONIM

 CONSOLIDATED
STATEMENTS OF OPERATIONS

 YEARS
ENDED DECEMBER 31, 2023 and 2022

 (IN
THOUSANDS EXCEPT SHARE AND PER SHARE AMOUNTS)

 2023

 2022

 2023

 2022

 Net
 revenues

 $

 $

 Cost
 of revenues

 74,308

 58,205

 Gross
 profit

 19,324

 11,623

 Operating
 expenses:

 and development

 1,772

 7,973

 Sales
 and marketing

 8,768

 7,274

 and administrative

 8,271

 10,666

 Total
 operating expenses

 18,811

 25,913

 Net
 income (loss) from operations

 ( 14,290
)

 Interest
 expense

 ( 15
)

 ( 97
)

 Other
 income (expense), net

 ( 214
)

 Net
 income (loss) before income taxes

 ( 13,903
)

 tax expense

 ( 374
)

 ( 184
)

 Net
 loss

 $
 ( 90
)

 $
)

 Net
 loss per share:

 Basic
 and diluted

 $
 ( 0.00
)

 $
 ( 0.49
)

 Weighted-average
 shares used in computing net loss per share:

 Basic
 and diluted

 41,689,386

 28,889,111

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

 F- 3

 SONIM

 CONSOLIDATED
STATEMENTS OF STOCKHOLDERS' EQUITY

 YEARS
ENDED DECEMBER 31, 2023, and 2022

 (IN
THOUSANDS EXCEPT SHARE AMOUNTS)

 Common Stock

 Additional Paid-in Capital

 Accumulated Deficit

 Equity

 Common Stock

 Additional
 Paid-in

 Accumulated

 Stockholders'

 Amount

 Capital

 Deficit

 Equity

 at, January 1, 2022

 18,808,885

 $

 $
 253,416

 $
 ( 234,805
)

 $
 18,630

 Issuance
 of common stock, net of issuance costs

 20,878,638

 14,394

 —

 14,415

 Issuance
 of common stock, compensation

 800,622

 —

 Net
 settlement of common stock upon release of RSU

 286,542

 —

 —

 —

 —

 Adoption
 of ASC 842 – leases (See Note 6)

 —

 —

 —

 ( 978
)

 ( 978
)

 Stock-based
 compensation

 —

 —

 1,551

 —

 1,551

 Net
 loss

 —

 —

 —

)

)

 at, December 31, 2022

 40,774,687

 $

 $
 269,874

 $
 ( 249,870
)

 $
 20,045

 40,774,687

 $

 $
 269,874

 $
 ( 249,870
)

 $
 20,045

 Net
 settlement of common stock upon release of RSU

 619,042

 —

 —

 —

 —

 Issuance
 of common stock for payment of services

 687,354

 —

 Issuance
 of common stock upon exercise of stock options

 1,000,000

 —

 Stock-based
 compensation

 —

 —

 1,496

 —

 1,496

 Net
 loss

 —

 —

 —

 ( 90
)

 ( 90
)

 at, December 31, 2023

 43,081,083

 $

 $
 272,285

 $
 ( 249,960
)

 $
 22,368

 43,081,083

 $

 $
 272,285

 $
 ( 249,960
)

 $
 22,368

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

 F- 4

 SONIM

 CONSOLIDATED
STATEMENT OF CASH FLOWS

 YEARS
ENDED DECEMBER 31, 2023 and 2022

 (IN
THOUSANDS)

 2023

 2022

 Cash
 flows from operating activities:

 Net
 loss

 $
 ( 90
)

 $
)

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

 Depreciation
 and amortization

 2,206

 2,375

 Stock-based
 compensation

 1,496

 1,551

 Loss
 on disposal of assets

 —

 Stock
 issued for services

 Gain
 on termination of lease

 —

 ( 730
)

 Credit
 losses

 Other

 ( 788
)

 in operating assets and liabilities:

 receivable

 ( 3,030
)

 ( 11,635
)

 Non-trade
 receivable

 1,308

 ( 14
)

 Inventory

 ( 2,607
)

 1,634

 expenses and other current assets

 4,045

 fulfillment assets

 ( 4,543
)

 ( 6,236
)

 Other
 assets

 ( 43
)

 ( 448
)

 payable

 ( 1,279
)

 11,653

 Accrued
 liabilities

 1,380

 ( 369
)

 revenue

 ( 19
)

 tax payable

 Net
 cash used in operating activities

 ( 4,052
)

 ( 12,360
)

 Cash
 flows from investing activities:

 Purchase
 of property and equipment

 ( 36
)

 ( 8
)

 Net
 cash used in investing activities

 ( 36
)

 ( 8
)

 Cash
 flows from financing activities:

 Proceeds
 from issuance of common stock, net of costs

 —

 14,415

 Proceeds
 from exercise of stock options

 —

 Repayment
 of long-term debt

 ( 147
)

 ( 67
)

 Net
 cash provided by financing activities

 14,348

 Net
 increase (decrease) in cash and cash equivalents

 ( 3,816
)

 1,980

 Cash
 and cash equivalents at beginning of the year

 13,213

 11,233

 Cash
 and cash equivalents at end of the year

 $
 9,397

 $
 13,213

 Supplemental
 disclosure of cash flow information:

 Cash
 paid for interest

 $

 $

 Cash
 paid for income taxes

 $

 $

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

 F- 5

 SONIM

 NOTES
TO THE CONSOLIDATED FINANCIAL STATEMENTS

 (In
Thousands, except Share and Per Share Amounts)

 NOTE
1— The Company and its significant accounting policies

 Description
of Business —Sonim Technologies, Inc. was incorporated in the state of Delaware on August 5, 1999, and is headquartered in San
Diego, California. The Company is a leading provider of rugged and consumer durable mobile devices designed to provide extra protection
for users who demand more durability in their work and everyday lives. Historically, the Company has focused on handsets and accessories
in the enterprise and government sectors. However, the Company has increased its product portfolio to include connected devices including
mobile hotspots that connect to the internet. In 2023, the Company has received five product awards from carriers in the U.S., Canada,
and Australia, for two models of mobile hotspots that will launch in 2024. The Company has also expanded its portfolio of rugged phones
to include a new semi-rugged smartphone that will be sold through the carriers to small business who want a more durable product. The
Company has received three product awards from carriers for this new smartphone that will launch in 2024. The Company also received a
product award for a consumer durable smartphone that will launch in the second half of 2024. In 2022, the Company began selling a tablet
that was developed using the Company's ODM model where the Company designs the product specifically for one customer and finds
a manufacturer for that product. The tablet was a high volume and low margin product and generated a significant portion of the Company's
revenue in 2023. Sales of the tablet ended in October 2023 as the product reach its end of life. The ODM model is not a core business
of the Company, and it is normal for ODM model revenue to fluctuate significantly.

 Liquidity
and Ability to Continue as a Going Concern —The Company's consolidated financial statements account for the continuation
of its business as a going concern. The Company is subject to the risks and uncertainties associated with the development and release
of new products. The Company's principal sources of liquidity as of December 31, 2023, consist of existing cash and cash equivalents
totaling $ 9,397. The Company believes that it can meet its obligations with this cash over the next twelve months following the filing
date of this report.

 To
provide additional liquidity to allow the Company to accelerate expansion into Europe and other markets, management is currently evaluating
various funding alternatives and may seek to raise additional funds through issuances of equity, mezzanine or debt securities, or through
arrangements with strategic or investment partners with greater sources of financing. The Company's ability to obtain additional
financing in the debt and equity capital markets is subject to several factors, including market and economic conditions, the Company's
performance and investor sentiment with respect to the Company and its industry.

Statement Presentation —The accompanying consolidated financial statements have been prepared in accordance with accounting
principles generally accepted in the U.S. ("U.S. GAAP") and pursuant to the rules and regulations of the Securities and Exchange
Commission (the "SEC") for annual financial information.

 Principles
of Consolidation —The accompanying consolidated financial statements include the accounts of Sonim Technologies, Inc. and its
wholly owned foreign subsidiaries, Sonim Technologies (INDIA) Private Limited, Sonim Technologies (Shenzhen) Limited, Sonim Technologies
Shenzhen Limited Beijing Branch, Sonim Technologies (Hong Kong) Limited and Sonim Communications India Private Limited (collectively,
the "Company"). All significant intercompany transactions and balances have been eliminated in consolidation.

 Reclassifications —Certain
prior period amounts have been reclassified to conform to the current period presentation. These reclassifications had no effect on the
reported results of operations.

 Estimates —The
preparation of consolidated financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and the reported amounts of
revenues and expenses during the reporting period. Actual results could differ from those estimates. These estimates include, but are
not limited to, estimates related to revenue recognition; valuation assumptions regarding the determination of the fair value of common
stock, as well as stock options; the useful lives of the Company's long-lived assets; product warranties; loss contingencies; the recognition and
measurement of income tax assets and liabilities, including uncertain tax positions; the net realizable value of inventory; and allowances
for credit losses. The Company bases its estimates on historical experience and on various other assumptions that the Company believes
to be reasonable under the circumstances. Actual results could differ from those estimates. As of the date of issuance of these financial
statements, the Company is not aware of any specific event or circumstance that would require it to update its estimates, judgments or
revise the carrying value of its assets or liabilities.

 F- 6

 Concentrations
of Credit Risk —The Company's product revenues are concentrated in the technology industry, which is highly competitive
and rapidly changing. Significant technological changes in the industry or customer requirements, or the emergence of competitive products
with new capabilities or technologies, could adversely affect the Company's consolidated operating results.

instruments that potentially subject the Company to credit risk consist primarily of cash and cash equivalents and accounts receivable.
Cash and cash equivalents are deposited with high-quality, federally insured commercial banks in the United States and cash balances
are in excess of federal insurance limits as of December 31, 2023 and 2022. On March 10, 2023, SVB was closed by the California Department
of Financial Protection and Innovation, which appointed the FDIC as receiver. If any of the financial institutions with whom the Company
does business were to be placed into receivership, then the Company may be unable to access the cash that it has on deposit with such
institutions.

 The
Company generally does not require collateral or other security in support of accounts receivable. To reduce credit risk, management
performs ongoing credit evaluations of its customers' financial condition.

 Segment
Information —The Company operates in one reporting segment. Operating segments are defined as components of an enterprise about
which separate financial information is evaluated regularly by the chief operating decision maker, who is the chief executive officer,
in deciding how to allocate resources and assessing performance. The Company's chief operating decision maker allocates resources
and assesses performance based upon discrete financial information at the consolidated level.

 Cash
and Cash Equivalents — The Company considers all highly liquid investments with an original maturity from the date of purchase
of 90 days or less to be cash equivalents. As of December 31, 2023, and 2022, cash and cash equivalents consist of cash deposited with
banks and money market funds. Included in the Company's cash and cash equivalents are amounts held by foreign subsidiaries. The
Company had $ 1,131 and $ 1,061 of foreign cash and cash equivalents included in the Company's cash positions on December 31, 2023
and 2022, respectively.

Receivable and Allowance for Credit Losses —Accounts receivable consist primarily of amounts due from customers in the course
of normal business activities. Collateral on trade accounts receivable is generally not required. In June 2016, the FASB issued ASU 2016-13,
 Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which requires measurement
and recognition of expected credit losses for financial assets held. This guidance is effective for interim and annual periods beginning
after December 15, 2022. The Company adopted this guidance effective January 1, 2023. The adoption of this pronouncement did not have
a material impact on the Company's consolidated financial statements and primarily resulted in new disclosures. Under this guidance,
the Company maintains an allowance for credit losses for estimated uncollectible accounts receivable. The allowance is based on the Company's
assessment of the economic health of its customers and its history of credit losses. Accounts are written off against the allowance account
when they are determined to be no longer collectible.

 Inventory —The
Company reports inventories at the lower of cost or net realizable value. Cost is determined using a first-in, first-out method ("FIFO")
and includes the cost of inventory, materials, labor, and manufacturing overhead related to the purchase and production of inventories.
Net realizable value is the estimated selling price in the ordinary course of business less reasonably predictable costs of completion,
disposal, and transportation.

 The
Company periodically reviews its inventory for potential slow-moving or obsolete items and writes down specific items to net realizable
value, as appropriate. The Company writes down inventory based on forecasted demand and technological obsolescence. These factors are
impacted by market and economic conditions, technology changes, new product introductions, and changes in strategic direction, and require
estimates that may include uncertain elements. Actual demand may differ from forecasted demand and such differences may have a material
effect on recorded inventory values. Any write-down of inventory to the lower of cost or net realizable value creates a new cost basis
that subsequently would not be marked up based on changes in underlying facts and circumstances.

and Equipment —Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation and amortization
are computed using the straight-line method over the estimated useful lives of the respective assets, generally 24 to 36 months. Leasehold
improvements are amortized over the shorter of estimated useful lives of the assets or the lease term. Expenditures for repairs and maintenance
are charged to expense as incurred. Upon disposition, the cost and related accumulated depreciation and amortization are removed from
the accounts and the resulting gain or loss is reflected in the consolidated statements of operations.

 Leases —The
Company accounts for its leases under ASC 842, Leases. Under this guidance, arrangements meeting the definition of a lease are classified
as operating or finance leases and are recorded on the Consolidated Balance Sheets as both a right of use asset and a lease liability,
calculated by discounting fixed lease payments over the lease term at the rate implicit in the lease or the Company's incremental
borrowing rate. Lease liabilities are increased by interest and reduced by payments each period, and the right of use asset is amortized
over the lease term. For operating leases, interest on the lease liability and the amortization of the right of use asset results in
straight-line rent expense over the lease term. Variable lease expenses are recorded when incurred. In calculating the right of use assets
and lease liabilities, the Company elects to combine lease and non-lease components. The Company excludes short-term leases having initial
terms of 12 months or less from the new guidance as an accounting policy election and recognizes rent expense on a straight-line basis
over the lease term.

 Non-recurring
Engineering ("NRE") Tooling and Purchased Software Licenses —Third-party design services relating to the design
of tooling materials and purchased software licenses used in the manufacturing process are capitalized and included in other assets within
the consolidated balance sheets. During the years ended December 31, 2023 and 2022, amortization of NRE tooling and NRE software costs
approximating $ 12 and $ 13 were charged to Cost of Revenues. The related net book value is $ 110 and $ 13, respectively, as of December
31, 2023 and 2022.

 F- 7

 Long-lived
Assets —The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying
amount of an asset may not be recoverable. No such impairments have been identified to date.

 Revenue
Recognition —The Company accounts for revenue in accordance with Accounting Standards Codification ("ASC") 606,
 Revenue from Contracts with Customers.

 The
Company recognizes revenue primarily from the sale of products, including its mobile phones, tablets, and accessories. The Company also
recognizes revenue from other contractual arrangements that may include a combination of products and NRE services or from the provision
of solely NRE services.

 Revenue
recognition incorporates discounts, price protection and customer incentives. In addition to cooperative marketing and other incentive
programs, the Company has arrangements with some distributors, which allow for price protection and limited rights of return, generally
through stock rotation programs. Under the price protection programs, the Company gives distributors credits for the difference between
the original price paid and the Company's then current price. Under the stock rotation programs, certain distributors are able
to exchange certain products based on the number of qualified purchases made during the period.

 The
Company's handsets typically require a technical approval process. This process entails design and configuration activities required
to conform the Company's devices to a wireless carrier customer's specific network requirements. Each wireless carrier defines
its own specific functional requirements and certification process in order for the product to be ready for manufacture. While the technical
approval process does involve some level of customization, in addition to design and configuration, the Company does not charge separately
and is not reimbursed for these activities to the extent that they do not involve significant customization and does not incur these
costs in advance of entering into binding agreements with its wireless carrier customers. Such technical approval is obtained prior to
shipment. Revenue is recognized when control of promised goods or services is transferred to a customer in an amount that reflects the
consideration to which the entity expects to be entitled in exchange for those goods or services. To determine revenue recognition for
its arrangements, the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance
obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations
in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation.

 Cost
of Revenues —Cost of revenues includes direct and indirect costs associated with the manufacture of the Company's products
as well as with the performance of NRE services in connection with significant design modification and customization. Direct costs include
the cost of inventory, shipping, royalties, warranty accruals, depreciation and amortization, supply chain costs, and logistic costs.

 Advertising —The
Company expenses the costs of advertising, including promotional expenses, as incurred. For the years ended December 31, 2023 and 2022
the Company had no advertising expenses.

 Shipping
and Handling Costs —When the Company bills customers for shipping and handling it includes such amounts as part of revenue.
Costs incurred for shipping and handling are recorded in cost of revenues.

Revenues —Deferred revenues represent the amount that is allocated to undelivered elements in multiple element arrangements.
The Company limits the revenue recognized to the amount that is not contingent on the future delivery of products or services or meeting
other specified performance conditions.

and Development —Research and development expenses consist of compensation costs, employee benefits, development fees paid to
ODM partners, research supplies, allocated facility related expenses and allocated depreciation and amortization. Research and development
expenses include costs incurred for the design and configuration activities of new products to conform to the specific functional requirements
of the Company's wireless carrier customers necessary to prepare the product for manufacture. The Company determined that the NRE
technical approval costs and the NRE field test costs are contract fulfillment costs and recognizes the associated NRE asset as these
costs are incurred. The Company tracks the NRE assets by product and customer, then amortizes the NRE assets to Cost of Revenues over
a period of four years, which is management's estimated average product life for each model phone, starting from the date of the
first significant sales.

 F- 8

 Stock-Based
Compensation —The Company measures equity classified stock-based awards granted to employees, consultants, and directors based
on the estimated fair value on the date of grant and recognizes compensation expense of those awards, net of actual forfeitures, on a
straight-line basis over the requisite service period, which is generally the vesting period of the respective award. For awards subject
to performance conditions, the Company evaluates the probability of achieving each performance condition at each reporting date and begins
to recognize expense over the requisite service period when it is deemed probable that a performance condition will be met using the
accelerated attribution method. The fair value of each stock option grant is estimated on the date of grant using the Black-Scholes option
pricing model, which is described more fully in Note 10. The fair value of each restricted stock award is measured as the fair value
per share of the Company's common stock on the date of grant.

 Warranty —The
Company provides standard warranty coverage on its accessories and handsets for one and three years, respectively, providing labor and
parts necessary to repair the systems during the warranty period. The warranty coverage is an assurance type warranty, and thus is not
a separate performance obligation. The Company accounts for the estimated warranty cost as a charge to cost of revenues when revenue
is recognized. The estimated warranty cost is based on historical product performance and field expenses.

 Utilizing
actual service records, the Company calculates the average service hours and parts expense per system to determine the estimated warranty
charge. The Company updates these estimated charges periodically. The actual product performance and/or field expense profiles may differ,
and in those cases the Company adjusts warranty accruals accordingly.

 From
time to time, the Company ships mobile devices to its customers as seed stock. The seed stock represents extra units of mobile devices
beyond the original mobile devices ordered by the customer and are primarily used to facilitate warranty coverage of mobile devices received
by the Company's customers from their direct customers.

 The
warranty liability account balance is based on management's estimates of the lifetime return rate for each model and the cost to
repair each returned model. These assumptions are based on historical rates for similar products and on actual return rates. If the estimated
cost to repair each unit increased by 10 %, then the warranty liability balance would be $ 52 higher at December 31, 2023. If the lifetime
return rate was increased by 10 %, then the warranty liability balance would be $ 52 higher at December 31, 2023. The cost of revenue for
the year ended December 31, 2023 would increase by the same amount as an increase in the warranty liability. Decreases to these rates
of 10 % will reduce the warranty liability by the same amount.

 Comprehensive
Income or Loss —The Company had no items of comprehensive income or loss other than net loss for the years ended December 31,
2023 and 2022. Therefore, a separate statement of comprehensive loss has not been included in the accompanying consolidated financial
statements.

currency translation —The Company uses the U.S. dollar as its functional currency for its significant subsidiaries. Foreign
currency assets and liabilities are translated into U.S. dollars at the end-of-period exchange rates except for property and equipment,
and related depreciation and amortization, which are translated at the historical exchange rates. Expenses are translated at average
exchange rates in effect during each period. Foreign assets held directly by the Company include certain accounts receivable balances
and bank accounts which are translated in the U.S. dollar at the end-of-period exchange rates. During the years ended December 31, 2023
and 2022, the Company had approximately $ 235 and $ 102, respectively, in net foreign currency transactions losses, which are included
in Other Expense, Net, on the Consolidated Statements of Operations.

 Sales
taxes —Sales and value added taxes collected from customers and remitted to governmental authorities are accounted for on a
net basis and not included in revenue.

taxes —The provision for income taxes is computed using the asset and liability method, under which deferred tax assets and
liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax
bases of assets and liabilities, and for operating losses and tax credit carryforwards. Deferred tax assets and liabilities are measured
using the currently enacted tax rates that apply to taxable income in effect for the years in which those tax assets are expected to
be realized or settled. The Company records a valuation allowance to reduce deferred tax assets to the amount that is believed more likely
than not to be realized.

 Compliance
with income tax regulations requires the Company to make decisions relating to the transfer pricing of revenue and expenses between each
of its legal entities that are located in several countries. The Company's determinations include many decisions based on management's
knowledge of the underlying assets of the business, the legal ownership of these assets, and the ultimate transactions conducted with
customers and other third parties. The calculation of the Company's tax liabilities involves dealing with uncertainties in the
application of complex tax regulations in multiple tax jurisdictions. The Company may be periodically reviewed by domestic and foreign
tax authorities regarding the amount of taxes due. These reviews may include questions regarding the timing and amount of deductions
and the allocation of income among various tax jurisdictions. In evaluating the exposure associated with various filing positions, the
Company records estimated reserves when it is more likely than not that an uncertain tax position will not be sustained upon examination
by a taxing authority. Such estimates are subject to change. See Note 11.

 Net
Loss per Share —Net loss per share is calculated by dividing the net loss by the weighted-average number of shares of common
stock outstanding during the period. For the years ended December 31, 2023 and 2022, for purposes of the calculation of diluted net loss
per share, warrants to purchase stock, unvested restricted stock units and stock options to purchase common stock are considered potentially
dilutive securities but have been excluded from the calculation of diluted net loss per share as their effect is antidilutive. As a result,
diluted net loss per share is the same as the basic net loss per share for the periods presented.

 F- 9

 New
accounting pronouncements —The Company is an "emerging growth company," as defined in Section 2(a) of the Securities
Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the "JOBS Act"), and it may take advantage of certain
exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies.
Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting
standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do
not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting
standards. The JOBS Act provides that an emerging growth company can elect to opt out of the extended transition period and comply with
the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected
not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application
dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time
private companies adopt the new or revised standard. This may make comparison of the Company's consolidated financial statements
with another public company, which is neither an emerging growth company nor an emerging growth company that has opted out of using the
extended transition period, difficult or impossible because of the potential differences in accounting standards used.

 Pronouncements
not yet adopted:

 In
November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures.
This ASU was issued to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment
expenses. This guidance applies to all public entities that are required to report segment information in accordance with Topic 280,
Segment Reporting. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years
beginning after December 15, 2024. Early adoption is permitted and the guidance should be applied retrospectively. ASU 2023-07 will be
effective for the Company for the annual period of its fiscal year ending December 31, 2024. The Company does not anticipate the adoption
of this guidance will have a material impact on its consolidated financial statements.

 In
December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. This ASU
was issued to address investor requests for more transparency about income tax information through improvements to income tax disclosure
primarily related to the rate reconciliation and income taxes paid information, and to improve the effectiveness of income tax disclosures.
This guidance is effective for public entities for annual periods beginning after December 15, 2024. Early adoption is permitted. ASU
2023-09 will be effective for the Company in the first quarter of its fiscal year ending December 31, 2025. The Company is currently
evaluating the impact the adoption of this guidance will have on its consolidated financial statements.

 NOTE
2 — Revenue recognition

 The
Company recognizes revenue primarily from the sale of products, including mobile phones, scanners, and accessories, and the majority
of the Company's contracts include only one performance obligation, namely the delivery of product. A performance obligation is
a promise in a contract to transfer a distinct good or service to the customer and is defined as the unit of account for revenue recognition
under ASC 606. The Company also recognizes revenue from other contracts that may include a combination of products and NRE services or
from the provision of solely NRE services. Where there is a combination of products and NRE services, the Company accounts for the promises
as individual performance obligations if they are concluded as distinct. Performance obligations are considered distinct if they are
both capable of being distinct and distinct within the context of the contract. In determining whether performance obligations meet the
criteria for being distinct, the Company considers a number of factors, such as the degree of interrelation and interdependence between
obligations, and whether or not the good or service significantly modifies or transforms another good or service in the contract. During
the years ended December 31, 2023 and 2022, the Company did not have any contracts in which the products and NRE services were concluded
to be a single performance obligation. In certain cases, the Company may offer tiered pricing based on volumes purchased for specific
model phones. To date, all tiered pricing provisions have fallen into observable ranges of pricing to existing customers, thus, not resulting
in any material right which could be concluded as its own performance obligation. In addition, the Company does not offer material post-contract
support services to its customers.

 F- 10

 Net
revenue for an individual contract is recognized at the related transaction price, which is the amount the Company expects to be entitled
to in exchange for transferring the goods and/or services. The transaction price for product sales is calculated as the product selling
price net of variable consideration which may include estimates for marketing development funds, sales incentives, and price protection
and stock rotation rights. The Company generally does not offer a right of return to its customers, except for certain distributors where
the company estimates future returns and reduces revenue on sales subject to return and maintains a reserve for returns allowance. Typically,
variable consideration does not need to be constrained as estimates are based on specific contract terms. However, the Company continues
to assess variable consideration estimates such that it is probable that a significant reversal of revenue will not occur. The transaction
price for a contract with multiple performance obligations is allocated to the separate performance obligations on a relative standalone
selling price basis. Standalone selling prices for products are determined based on the prices charged to customers, which are directly
observable. The standalone selling price of the professional services are mostly based on time and materials. The Company determines
its estimates of variable consideration based on historical collection experience with similar payor classes, aged accounts receivable
by payor class, terms of payment agreements, correspondence from payors related to revenue audits or reviews, its historical settlement
activity of audited and reviewed claims and current economic conditions using the portfolio approach. Revenue is recognized only to the
extent that it is probable that a significant reversal of the cumulative amount recognized will not occur in future periods.

 Revenue
is then recognized for each distinct performance obligation as control is transferred to the customer. Revenue attributable to hardware
is recognized at the time control of the product transfers to the customer. Control is generally transferred when the Company has a present
right to payment and title and the significant risks and rewards of ownership of products or services are transferred to its customers.
For most of the Company's revenue attributable to hardware, control transfers when products are shipped. Revenue attributable to
professional services is recognized as the Company performs the professional services for the customer.

 Disaggregation
of net revenues

 The
following table presents net revenues disaggregate by product category:

of Net Revenue Disaggregate by Product Category

 2023

 2022

 Year
 Ended December 31,

 2023

 2022

 Smartphones

 $
 31,410

 $
 17,763

 Feature
 Phones

 15,765

 21,252

 Tablets

 44,818

 29,475

 Accessories/Other

 1,639

 1,338

 Total
 Net Revenues

 $

 $

 Shipping
and handling costs

 The
Company has elected to account for shipping and handling activities related to contracts with customers as costs to fulfill the promise
to transfer the associated products.

costs

 Applying
the practical expedient, the Company recognizes the incremental costs of obtaining contracts as an expense when incurred when the amortization
period of the assets that otherwise would have been recognized is one year or less. These costs are included in sales and marketing and
general and administrative expenses.

 The
non-recurring costs associated with design and development of new products for technical approval, represent costs to fulfill a contract
pursuant to ASC 340-40, Other Assets and Deferred Costs. Accordingly, the Company capitalizes these non-recurring engineering
costs and amortizes such costs over the estimated period of time over which they are expected to be recovered, which is typically four
years, the estimated life of a particular model phone.

 The
total capitalized costs to fulfill a contract are primarily associated with the Company's introduction of the XP10, XP5plus, and
XP3plus model phones. As of December 31, 2023 and 2022, the total costs to fulfill a contract included in Contract Fulfillment Assets
were $ 9,232 and $ 6,848, respectively.

 F- 11

balances

 The
Company records accounts receivable when it has an unconditional right to consideration. As of December 31, 2023, and 2022, the Company
does not have a contract receivable balance. Contract liabilities are recorded when cash payments are received or due in advance of performance.
Contract liabilities consist of advance payments and deferred revenue, where the Company has unsatisfied performance obligations. Contract
liabilities are presented as a component of Deferred Revenue on the Consolidated Balance Sheets. As of December 31, 2023 and December
31, 2022, the contract liabilities were $ 12 and $ 31, respectively, with the contract liabilities as of December 31, 2023, expected to
be recognized into revenue in 2024.

 The
following table is a roll forward of contract liabilities:

of Contract Liabilities

 2023

 2022

 Balance, January 1

 $

 $

 Recognition
 of revenue

 ( 490
)

 ( 1,001
)

 Addition
 of revenue

 1,021

 Balance, December 31

 $

 $

 NOTE
3 — Fair value measurement

 The
fair value measurements standard establishes a framework for measuring fair value. That framework provides 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 standard are described below:

 Level
1—Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets that the
Company has the ability to access.

 Level
2—Inputs to the valuation methodology include:

 Quoted
 market prices for similar assets or liabilities in active markets;

 Quoted
 prices for identical or similar assets or liabilities in inactive markets;

 Inputs
 other than quoted prices that are observable for the asset or liability;

 Inputs
 that are derived principally from or corroborated by observable market data by correlation or other means.

 If
the asset or liability has a specified (contractual) term, the level 2 input must be observable for substantially the full term of the
asset or liability.

 Level
3—Inputs to the valuation methodology are unobservable and significant to the fair value measurement.

 The
asset's or liability's fair value measurement level within the fair value hierarchy is based on the lowest level of any input
that is significant to the fair value measurement. Valuation techniques used need to maximize the use of observable inputs and minimize
the use of unobservable inputs.

 The
following is a description of the valuation methodologies used for assets and liabilities measured at fair value. There have been no
changes in the methodologies used for the years ended December 31, 2023 and 2022.

 Money
market funds are classified within level 1 of the fair value hierarchy because they are valued using quoted market prices.

 The
methods described above may produce a fair value calculation that may not be indicative of net realizable value or reflective of future
fair values. Furthermore, while the Company believes its valuation methods are appropriate and consistent with other market participants,
the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different
fair value measurement at the reporting date.

 F- 12

 The
following tables sets forth by level, within the fair value hierarchy, the Company's assets and liabilities at fair value:

 Summary of Fair Value Assets and Liabilities

 Level

 Level

 Level

 Total

 31, 2023

 Level

 Level

 Level

 Total

 Assets:

 Money
 market funds *

 $

 $
 —

 $
 —

 $

 Level

 Level

 Level

 Total

 31, 2022

 Level

 Level

 Level

 Total

 Assets:

 Money
 market funds *

 $
 1,501

 $
 —

 $
 —

 $
 1,501

 *

 Included
 in cash and cash equivalents on the consolidated balance sheets.

 NOTE
4— Significant Balance Sheet Components

 Inventory
consisted of the following:

of Inventory

 2023

 2022

 31,

 2023

 2022

 Devices — for
 resale

 $
 5,324

 $
 3,473

 Raw
 materials

 Accessories

 Inventory, Net

 $
 6,517

 $
 3,910

 The
Company purchases raw materials in bulk to obtain a lower price. The raw materials are resold to third-party manufacturers at the Company's
cost.

 Distributor
returns allowance

 The
Company records reductions to revenue related to future distributor product returns based on the Company's expectation. The Company
had inventory related to distributor product returns totaling approximately $ 4 and $ 4, respectively, as of December 31, 2023 and 2022.

expenses and other current assets consisted of the following:

of Prepaid Expenses and Other Current Assets

 2023

 2022

 31,

 2023

 2022

 Deposits
 for manufacturing inventory

 $

 $
 —

 taxes

 Refundable
 value added taxes

 —

 licenses and royalties

 and officer insurance

 parts (direct buy)

 consulting services

 —

 Other

 expenses and other current assets

 $
 1,608

 $
 1,807

 F- 13

and equipment consisted of the following:

of Property and Equipment

 2023

 2022

 31,

 2023

 2022

 Computer
 equipment

 $

 $

 Software

 —

 Software [Member]

 —

 Furniture,
 fixtures, and office equipment

 Property and equipment,
 gross

 Less:
 accumulated depreciation and amortization

 ( 465
)

 ( 419
)

 and equipment, net

 $

 $

 Depreciation
and amortization expense of property and equipment for the years ended December 31, 2023 and 2022, was $ 47 and $ 244, respectively. During
2022, the Company retired or disposed of computer equipment, software, and leasehold improvements with a cost of $ 4,751 and accumulated
depreciation of $ 4,621 as the Company stopped manufacturing in 2022 and two U.S. leases were terminated. The Company recorded a loss
on the disposal of assets of $ 130 on these disposals that is included in Other Expense, Net, in the Consolidated Statements of Operations.

fulfillment assets are capitalized costs to test and obtain certification for cell phones and data devices with specific carriers. These
costs are amortized over the estimated life of the device, which is four years. Contract fulfillment assets for the years ended December
31, 2023 and 2022 are $ 9,232 and $ 6,848 respectively. Amortization of contract fulfillment assets for the years ended December 31, 2023
and 2022 was $ 2,159 and $ 1,733, respectively.

 Other
assets consisted of the following:

 Schedule of Other Assets

 2023

 2022

 31,

 2023

 2022

 Advances
 to third-party manufacturer

 $
 2,000

 $
 2,000

 and officer insurance

 Deposits

 Other

 Total Other
 Assets

 $
 2,898

 $
 2,972

 Accrued
liabilities consisted of the following:

of Accrued Expenses

 2023

 2022

 31,

 2023

 2022

 Customer
 allowances

 $
 8,148

 $
 4,130

 Employee-related
 liabilities

 1,755

 1,365

 Warranties

 Accrual
 for goods received not invoiced

 Contractual
 obligations

 1,107

 Royalties

 fulfillment costs

 1,469

 Credits
 due to customers

 Returns
 allowance

 Legal

 Other

 Accrued liabilities

 $
 12,233

 $
 10,692

 F- 14

 The
table below sets forth the activity in the warranty liability, which is included in Accrued Liabilities on the Consolidated Balance Sheets:

of Warrant Liability Included in Accrued Expenses on Consolidated Balance Sheet

 2023

 2022

 Balance, January 1

 $

 $

 Additions

 1,057

 1,493

 Cost
 of warranty claims

 ( 1,175
)

 ( 1,693
)

 Balance, December 31

 $

 $

 NOTE
5— Accounts Receivable

 The
following table presents the components of the Company's receivables:

 Schedule of Accounts Receivable

 2023

 2022

 31,

 2023

 2022

 Trade
 receivables

 $
 25,576

 $
 22,546

 Allowance
 for credit losses

 ( 272
)

 ( 113
)

 receivable, net

 25,304

 22,433

 Non-trade
 receivables

 2,269

 Total
 accounts receivable

 $
 26,265

 $
 24,702

 As
of January 1, 2022, accounts receivable, net, was $ 10,803 and non-trade receivables was $ 2,255.

 The
Company has non-trade receivables from manufacturing vendors resulting from the sale of components to the vendors who manufacture and
assemble final products for the Company.

2023, the Company implemented ASC 326 and accrued an allowance for credit losses. The Company determined the probability of default for
each pool of receivables with similar risk characteristics. The probability of loss was applied to the value of the receivables and an
allowance for potential credit losses was recorded with the offset to credit loss expense.

 The
following table displays the roll forward of the allowance for credit losses on the Company's trade receivables during the year
ended December 31, 2023:

of Allowance For Credit Losses on Trade Receivables

 Balance, January 1, 2023

 $

 Provision
 for credit losses

 Balance, December 31, 2023

 $

 Trade
receivables from the customer that purchases tablets from the Company accounts for 69 % and 84 %, respectively, of accounts receivable,
net, at December 31, 2023 and 2022. One additional customer accounted for 15 % of accounts receivable, net, at December 31, 2023. In October
2023, the Company stopped sales of the tablets to this customer as the product reached the end of its life cycle. The tablet customer
had a receivable due to the Company of $ 17,443 at December 31, 2023. In February 2024, an agreement was executed that transferred $ 11,308
of the receivables to the manufacturer of the tablets in exchange for relieving the Company of a $ 11,308 accounts payable liability.
See Note 15.

 F- 15

 NOTE
6— Leases

 All
of the Company's leases are for office space. The Company entered into a sublease for a right of use asset in September 2021 that
had sublease income that was significantly less than the head lease payments. On August 31, 2022, the Company entered into an agreement
with the landlord to cancel the head lease for $ 260 in consideration paid by the Company to the landlord. On August 31, 2022, the Company
derecognized the remaining lease liability and ROU asset. This resulted in a $ 730 gain on the termination of the lease. The sublease
was terminated when the head lease was terminated.

 The
following table shows the activity of the ROU assets:

of Right of Use Assets

 31,

 2023

 2022

 Balance, January 1

 $

 $
 —

 Adoption
 of ASC 842

 —

 1,805

 Derecognition
 of deferred rent liability

 —

 ( 142
)

 Impairment
 of ROU asset

 —

 ( 978
)

 Derecognition
 on cancelation of lease

 —

 ( 221
)

 Additions

 —

 Amortization

 ( 266
)

 ( 398
)

 Balance, December 31

 $

 $

 The
following table shows the activity of the lease liability:

of Lease Liability

 31,

 2023

 2022

 Balance, January 1

 $

 $
 —

 Adoption
 of ASC 842

 —

 1,805

 Derecognition
 on cancelation of lease

 —

 ( 1,211
)

 Additions

 —

 Principal
 payments

 ( 266
)

 ( 528
)

 Balance, December 31

 Less
 short-term portion

 Long-term
 lease liability

 $
 —

 $
 —

 Future
minimum lease payments under noncancelable operating lease commitments were as follows as of December 31, 2023:

of Future Minimum Lease Payments under Noncancelable Operating Lease Commitments

 2024

 $

 Total
 undiscounted minimum lease commitments

 $

 Effect
 of discounting

 ( 1
)

 Lease
 liabilities at December 31, 2023

 $

 F- 16

 In
connection with leases, for the year ended December 31, 2023 and 2022, the Company recognized $ 266 and $ 398, respectively, of rent expense.
Variable lease payments, including reimbursements to the landlord for property taxes and operating expenses, of approximately $ 143 and
short-term rent payments of $ 11 were included in rent expense for the year ended December 31, 2022, and were offset by $ 80 in sublease
income. The Company does not have any lease extension or termination options on any lease. There are no residual value guarantees in
any lease. The weighted average remaining lease term of the operating leases is approximately 0.2 years for the years ended December
31, 2023 and 2022. The weighted average of the discount rate for each lease as of December 31, 2023 and 2022 is 8.5 %.

 NOTE
7— Borrowings

 Long-Term
Debt

 Promissory
Notes Payable —In 2014 and 2017, the Company entered into agreements with one of its vendors, whereby certain of its trade payables
for royalties and royalty up-front payments were converted to payment plans. In December 2018, the Company amended its accounts payable
financing agreements, effective January 1, 2019, which provides for the $ 736 then-outstanding balance to be paid in twenty equal quarterly
installments. The amounts due under these agreements were paid in quarterly installments over periods from two to four years, with interest
ranging up to 8 %. The entire balance was short term as of December 31, 2022 and was paid in full during the year ended December 31, 2023.

 The
components of the long-term debt balance were as follows as of December 31:

of Components of Long-term Debt

 2023

 2022

 Promissory
 note payable

 $
 —

 $

 Less
 current portion

 —

 ( 147
)

 Total
 long-term debt

 $
 —

 $
 —

 NOTE
8— Convertible Preferred Stock and Stockholders' Equity

 On
November 2, 2018, the Company amended and restated its previous certificate of incorporation and adjusted its authorized capital stock
(par value of $ 0.001) to consist of 100,000,000 shares of common stock and 5,000,000 shares of preferred stock. Each outstanding share
of common stock entitles the holder to one vote on each matter properly submitted to the stockholders of the Company for vote. As of
December 31, 2023, no shares of preferred stock have been issued.

 The
following table shows shares of common stock reserved as of:

of Common Stock Reserved

 2023

 2022

 31,

 2023

 2022

 subject to options to purchase common stock

 5,146,382

 4,476,215

 Unvested
 restricted stock units

 681,846

 860,888

 subject to warrants to purchase common stock

 Total

 5,828,230

 5,337,105

 NOTE
9— Stockholders' Equity

 On
April 13, 2022, the Company entered into a subscription agreement (the "Subscription Agreement") with AJP Holding Company,
LLC ("AJP") whereby, subject to the terms thereof, AJP agreed to purchase from the Company an aggregate of 20,833,333 shares
of the Company's common stock (the "Purchased Shares") for a purchase price of $ 0.84 per share, for an aggregate purchase
price of $ 17,500.

 F- 17

 Pursuant
to the terms and conditions set forth in the Subscription Agreement, the Purchased Shares were issued in two tranches: (i) 14,880,952
shares of the Company's common stock (the "Initial Shares") was issued in consideration for an aggregate purchase price
of $ 12,500 ("First Closing") and (ii) 5,952,381 shares will be issued for an aggregate purchase of $ 5,000.

 The
first closing was completed on July 13, 2022, and the second closing was completed on August 8, 2022.

 In
connection with the closings, the Company incurred approximately $ 3,130 of expenses which was offset against the proceeds in the third
quarter of 2022.

 Upon
completion of the transaction, AJP controlled approximately 52 % of Sonim's post-transaction outstanding common stock. As of December
31, 2023, AJP controlled approximately 47 % of Sonim's outstanding common stock. The agreement with AJP also included a transition
of the management team and the Company's Executive Vice President for Global Operations and Engineering, who was appointed as Chief
Executive Officer, effective April 14, 2022. The CEO is affiliated with the investment group at AJP. The Company continued to use the
historical basis of assets and liabilities following the transaction.

 On
July 13, 2022, Robert Tirva, the CFO and President of the Company, resigned and became eligible for $ 1,000 in severance payments over
20 months, plus certain health insurance benefits, if he meets certain requirements. The severance costs were charged to expense as of
the severance date. On July 13, 2022, approximately $ 1,200 in severance costs that were triggered by the AJP transaction were included
in accrued expenses. On July 13, 2022, the Company appointed Clay Crolius as Chief Financial Officer.

 On
July 13, 2022, two of the Company's Board Members resigned and the remaining Board of Directors appointed three new Board Members,
including a representative of AJP. On July 14, 2022, the Board of Directors appointed two additional Board Members including Peter Liu,
the Company's Chief Executive Officer.

 On
September 23, 2021, the company entered into a Sales Agreement with the Sales Agent, to sell shares of its common stock, $ 0.001 par value
per share, having an aggregate offering price of up to $ 41,637 from time to time, through a new at-the-market program ("ATM Program").
Under the terms of the Sales Agreement, the Company will pay the Sales Agent a commission equal to 3.0 % of the gross proceeds from each
sale of common stock sold through it under the Sales Agreement. From January 1, 2022, through January 4, 2022, the Company issued and
sold an aggregate of 45,305 shares of its common stock at an average price per share of $ 0.99 under the ATM Program for net proceeds
of approximately $ 45.

 F- 18

 NOTE
10— Stock-based Compensation

 As
of December 31, 2023, the Company had the 2012 Equity Incentive Plan (the "2012 Option Plan"), 2019 Equity Incentive Plan
(the "2019 Option Plan") and the 2019 Employee Stock Purchase Plan ("ESPP") in place.

 The
2019 Option Plan provides for the grant of incentive and non-statutory stock options ("Options"), stock appreciation rights
("SAR"), restricted stock awards ("RSA"), and restricted stock unit awards ("RSU") to employees,
nonemployee directors, and consultants of the Company. Option awards granted under the 2019 Option Plan generally become exercisable
ratably over a two -year or four -year period following the date of grant and expire ten years from the date of grant. At the discretion
of the Board of Directors, certain awards may be exercisable immediately at the date of grant but are subject to a repurchase right,
under which the Company may buy back any unvested shares at their original exercise price in the event of an employee's termination
prior to full vesting. All other awards are exercisable only to the extent vested. At December 31, 2023 and 2022, there were no shares
that had been early exercised that were subject to the Company's repurchase right at that date. The exercise price or strike price
for Options and SARs granted under the 2019 Option Plan must generally be at least equal to 100 % of the fair value of the Company's
common stock at the date of grant, as determined by the Board of Directors. The exercise price of incentive stock options granted under
the 2019 Option Plan to ten percent or greater stockholders must be at least equal to 110 % of the fair value of the Company's common
stock at the date of grant, as determined by the Board of Directors, and are not exercisable after five years from the date of grant.

 The
Board of Directors adopted, and its stockholders approved, the ESPP and the 2019 Option Plan in March 2019 and April 2019, respectively,
each of which became effective in connection with the IPO. As of December 31, 2023, there were 158,337
 shares of common stock available to be issued
under the ESPP. The
number of shares of common stock reserved for issuance under the ESPP automatically increases on January 1 of each calendar year for
10 years, starting January 1, 2020, and ending on, and including, January 1, 2029, in an amount equal to the lesser of 1 % of the total
number of shares of capital stock outstanding on December 31 st of the prior calendar year, and (ii) 50,000 shares, unless
the Board of Directors or the compensation committee of the Board of Directors determines prior to such date that there will be a lesser
increase, or no increase. The increase under the ESPP for both 2023 and 2022 was 50,000 shares. During 2022 and 2023, there were no purchases
under the ESPP.

 As
of December 31, 2023, there were 1,843,128
 shares of common stock available to be issued
under the 2019 Option Plan, plus the number of shares subject to outstanding stock options or other stock awards that were granted under
the 2012 Option Plan that are forfeited, terminated, expired or are otherwise not issued. Additionally,
 the number of shares of common stock reserved for issuance under the 2019 Option Plan automatically increases on January 1 of each calendar
year for 10 years, starting January 1, 2020 and ending on and including January 1, 2029, in an amount equal to 5 % of the total number
of shares of capital stock outstanding on December 31 st of the prior calendar year, unless the Board of Directors or compensation
committee determines prior to the date of increase that there will be a lesser increase, or no increase. The
automatic increase under the 2019 Option Plan for the years ended December 31, 2023 and 2022 was 2,038,734
 shares and 940,444
 shares, respectively. In July 2022, the Board
of Directors approved an increase in the number of shares of common stock reserved for future issuance under the 2019 Option Plan by
 5,000,000
 shares, which was approved by the Company's
stockholders on October 26, 2022. In August 2023, the Board of Directors approved an increase in the number of shares of common stock
reserved for future issuance under the 2019 Option Plan by 2,000,000
 shares, which was approved by the Company's
stockholders on September 28, 2023.

 For
the years ended December 31, 2023 and 2022, zero shares of common stock were issued under the 2019 Employee Stock Purchase Plan.

 F- 19

 Stock-based
compensation expense is as follows:

of Stock Based Compensation Expense

 2023

 2022

 For
 the Year Ended

 31,

 2023

 2022

 Research and development

 $

 $

 Sales and marketing

 General and administrative

 1,426

 Cost of revenues

 Total

 $
 1,496

 $
 1,551

 On
January 27, 2022, 415,023 shares of common stock were issued under the 2019 Option Plan as payment to three executives for bonuses that
relate to the 2021 year. The dollar value of these bonuses was fixed at $ 254 as of December 31, 2021, and the number of shares issued
on January 27, 2022 was determined based on the closing stock price on that date.

 In
the third quarter of 2022, 385,599 shares of common stock were issued under the 2019 Option Plan as payment to consultants for consulting
fees. The value of these shares was $ 260 at the time of issuance and $ 260 was recorded as General and Administrative expenses in the
Consolidated Statements of Operations for the year ended December 31, 2022.

the year ended December 31, 2023, 457,354 shares of common stock were issued under the 2019 Option Plan as payment to consultants for
consulting fees and 230,000 shares of common stock were issued outside of the Company's stock plans as payment to consultants for
consulting fees. The aggregate value of shares issued to consultants for consulting fees during the year ended December 31, 2023 was
$ 498 at the time of issuance, $ 388 of which is included in General and Administrative expenses in the Consolidated Statements of Operations
for the year ended December 31, 2023, and $ 110 of which is included in Prepaid Expenses and Other Current Assets in the Consolidated
Balance Sheets as of December 31, 2023.

 Stock
Options:

 Stock
option activity for the years ended December 31, 2023 and 2022 is as follows:

of Stock Option Activity

 Weighted
 average exercise price

 Weighted
 average remaining contractual life

 Aggregate
 Intrinsic

 per
 share

 (in
 years)

 Value *

 at January 1, 2022

 95,413

 $
 40.00

 6.73

 $

 granted

 4,414,419

 $
 0.44

 exercised

 —

 $
 —

 forfeited

 ( 15,303
)

 $
 33.65

 cancelled

 ( 18,314
)

 $
 49.67

 at December 31, 2022

 4,476,215

 $
 0.95

 9.76

 $

 granted

 1,803,000

 $
 0.57

 exercised

 ( 1,125,000
)

 $
 0.42

 forfeited

 —

 $
 —

 cancelled

 ( 7,833
)

 $
 4.50

 at December 31, 2023

 5,146,382

 $
 0.93

 8.94

 $
 1,370

 Vested
 and expected to vest at December 31, 2023

 5,146,382

 $
 0.93

 8.94

 $
 1,370

 Exercisable
 at December 31, 2023

 609,948

 $
 4.00

 8.55

 $

 *

 The
 intrinsic value is calculated as the difference between the exercise price and the fair value of the common stock on the balance
 sheet date.

 On
December 26, 2023, an employee exercised 125,000 stock options. The Company issued common stock related to the exercised stock options
in January 2024.

 As
of December 31, 2023, there was approximately $ 1,395 of unamortized stock-based compensation cost related to unvested stock options,
which is expected to be recognized over a weighted average period of 1.53 years.

 The
total pre-tax intrinsic value of options exercised during the year ended December 31, 2023 was $ 196. The intrinsic value is the difference
between the estimated fair value of the Company's common stock at the date of exercise and the exercise price for in-the-money
options.

 The
weighted average grant date fair value of options granted during the years ended December 31, 2023 and 2022 was $ 0.57 and $ 0.40, respectively.

 The
fair value of stock options is determined using the Black-Scholes option-pricing model using various inputs, including the Company's
estimates of the fair value of common stock on the date of grant, expected term, expected volatility, risk-free interest rate, and expectations
regarding future dividends. Stock-based compensation also reflects the Company's estimate regarding the portion of awards that
may be forfeited.

 F- 20

 The
following describes the key inputs used by the Company:

 Fair
Value of Common Stock—The Company measures equity classified stock-based awards granted to employees, consultants, and directors
based on the estimated fair value on the date of grant, and the expense is recognized on a straight-line basis over the vesting period.

Term—The expected term represents the period that the Company's stock options are expected to be outstanding. The majority
of stock option grants are considered to be "plain vanilla" and thus the Company determines the expected term using the simplified
method. The simplified method deems the term to be the average of the time-to-vesting and the contractual life of the options.

Volatility—The expected volatility was derived from the historical stock volatility of the Company's common stock since its
IPO in May 2019.

 Risk-Free
Interest Rate—The risk-free interest rate is based on the interest yield in effect at the date of grant for zero coupon U.S. Treasury
notes with maturities approximately equal to the option's expected term.

 Dividend
Rate—The expected dividend rate was assumed to be zero, as the Company has not previously paid dividends on common stock and has
no current plans to do so.

 Forfeiture
Rate—Forfeitures are recognized when they occur. Historically, the Company estimated the forfeiture rate based on an analysis of
actual forfeiture experience, analysis of employee turnover behavior, and other factors.

 The
following represents the weighted-average assumptions used in the Black-Scholes valuation model by the Company in calculating the fair
value of each stock option granted during the year ended December 31, 2023:

of Fair Value Option grants

 dividend yield

 %

 Risk-free
 interest rate

 3.81
 %

 volatility

 %

 life (in years)

 5.6

 Restricted
Stock Awards:

2022, 385,599 restricted stock awards with a grant date value of $ 260 were awarded and released in exchange for consulting services.
The expense was recorded in the Consolidated Statements of Operations as General and Administrative expenses.

2023, 457,354 restricted stock awards with a grant date value of $ 305 were awarded and released in exchange for consulting services.
The expense was recorded in the Consolidated Statements of Operations as General and Administrative expenses.

 Restricted
Stock Units:

 The
Company accounts for restricted stock units ("RSUs") issued to employees and non-employees at fair value, based on the market price of
the Company's common stock on the date of grant. The RSUs are expensed over the vesting period, and the Company accounts for forfeitures as they occur.
RSUs, primarily issued as incentives, generally vest annually over one to four years.

 The
following table summarized the outstanding RSUs as of December 31, 2023:

of Outstanding Restricted Stock Units

 RSUs

 at January 1, 2022

 860,888

 Granted

 445,200

 Released

 ( 619,042
)

 Forfeited

 ( 5,200
)

 at December 31, 2023

 681,846

 As
of December 31, 2023, there was approximately $ 391 of unamortized stock-based compensation cost related to unvested RSUs, which is expected
to be recognized over a weighted average period of 1.15 years.

 F- 21

 NOTE
11— Income Taxes

 The
following table presents the income (loss) before income taxes for domestic and foreign operations, and the components of the provision
(benefit) for income taxes for the years ended December 31:

of Income Tax Expense Benefit

 2023

 2022

 Domestic
 loss

 $
 ( 425
)

 $
 ( 13,885
)

 subsidiaries income (loss)

 ( 18
)

 (loss) before income taxes

 $

 $
 ( 13,903
)

 2023

 2022

 income tax expense:

 $

 $
 —

 State

 Total

 income tax expense (benefit):

 —

 —

 State

 —

 —

 ( 143
)

 Total

 ( 143
)

 Total
 provision for income taxes

 $

 $

 The
Company's effective tax rate differs from the federal statutory rate due to the following for the years ended December 31:

of Effective Income Tax

 2023

 2022

 Statutory
 federal income tax rate

 21.00
 %

 21.00
 %

 State
 income taxes, net of federal tax benefits

 23.20
 %

 1.00
 %

 Stock
 compensation

 84.92
 %

 - 1.43
 %

 ASC
 842 Adoption

 0.00
 %

 1.48
 %

 rate differential

 58.55
 %

 - 1.20
 %

 GILTI
 Inclusion

 26.15
 %

 - 0.17
 %

 Non-deductible
 expenses

 1.02
 %

 0.00
 %

 Valuation
 allowance

 - 83.07
 %

 - 22.00
 %

 Effective
 tax rate

 131.77
 %

 - 1.32
 %

 F- 22

income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial
reporting purposes and the amounts used for income tax purposes. The following table presents the significant components of the Company's
deferred tax assets and liabilities at December 31:

of Components of the Company's Deferred Tax Assets and Liabilities

 2023

 2022

 Gross
 deferred tax assets:

 Net
 operating loss carryforward

 $
 18,887

 $
 18,937

 Section
 174 capitalized costs

 1,873

 1,697

 Tax
 credits

 Accruals
 and reserves

 1,927

 2,314

 and equipment

 ASC

 Alternative
 minimum tax credits

 Total
 gross deferred tax assets

 22,841

 23,133

 Less:
 valuation allowance

 ( 22,774
)

 ( 22,996
)

 Total
 deferred tax assets net of valuation allowance

 tax liabilities:

 ASC
 842 right of use asset

 ( 12
)

 ( 14
)

 Net
 deferred tax assets

 $

 $

 A
valuation allowance is provided for deferred tax assets where the recoverability of the assets is uncertain. The determination to provide
a valuation allowance is dependent upon the assessment of whether it is more likely than not that sufficient future taxable income will
be generated to utilize the deferred tax assets. Based on the weight of the available evidence, which includes the Company's historical
operating losses, lack of taxable income, and the accumulated deficit, the Company provided a full valuation allowance against the U.S.
deferred tax assets resulting from the accruals and reserves along with the net operating loss and credits carried forward.

 As
of December 31, 2023 and 2022 the Company had net deferred income tax assets related primarily to net operating loss carry forwards,
accruals and reserves and tax credit carryforward that are not currently being recognized of $ 22,841 and $ 23,133, respectively, which
have been offset by a valuation allowance.

 The
Company has not provided U.S. Federal and State income taxes, nor foreign withholding taxes on approximately $ 10,573 of undistributed
earnings for certain non-US subsidiaries, because such earnings are intended to be indefinitely reinvested. If these earnings were distributed
to the U.S. in the form of dividends or otherwise, or if the shares of the relevant foreign subsidiaries were sold or otherwise transferred,
the Company would not be subject to U.S. income tax due to the transition tax of IRC Section 965 or via newly enacted Global Intangible
Low-Taxed Income ("GILTI") provision, enacted as part of the 2017 U.S. Tax Act. The Company would be subject to U.S. state
tax and potential foreign withholding taxes on a repatriation of the foreign earnings. The amount of unrecognized deferred income tax
liability related to these earnings is not material.

 Estimate
of cumulative foreign earnings is as follows as of December 31:

of Cumulative Foreign Earnings

 2023

 2022

 China

 $
 5,471

 $
 5,031

 India

 5,102

 5,098

 Total

 $
 10,573

 $
 10,129

 The
Company had net operating loss carryovers as follows as of December 31:

 Summary
of Operating Loss Carryforwards

 2023

 2022

 NOL

 $
 88,066

 $
 88,375

 Domestic Tax Authority

 $
 88,066

 $
 88,375

 State
 NOL

 $
 7,086

 $
 7,429

 State and Local Jurisdiction

 $
 7,086

 $
 7,429

 Net operating loss carryovers

 $
 7,086

 $
 7,429

 F- 23

 Net
operating loss carryforwards are available to offset future federal and state taxable income. Federal and state net operating loss carryforwards
begin to expire in 2037 and 2035, respectively. The net operating losses have annual Section 382 limitations.

 The
Company had research and development ("R&D") credit carryforwards as follows as of December 31:

 Summary
of Tax Credit Carryforwards

 2023

 2022

 R&D credits

 $
 —

 $
 —

 Internal Revenue Service (IRS)

 $
 —

 $
 —

 California
 R&D credits

 $

 $

 California Franchise Tax Board

 $

 $

 R&D credits

 $

 $

and state laws impose restrictions on the utilization of net operating loss carryforwards and R&D credit carryforwards in the event
of a change in ownership of the Company, which constitutes an 'ownership change' as defined by Internal Revenue Code Section
382 and 383. The Company experienced an ownership change in the past that materially impacts the availability of its net operating losses
and tax credits. The amounts indicated in the above tables reflect the reduction of net operating losses and credit carryforwards as
a result of previous ownership changes that the Company experienced. Should there be additional ownership changes in the future, the
Company's ability to utilize existing carryforwards could be substantially restricted.

 The
Company had excess interest expense carryforwards of $ 1,333 as of December 31, 2023. Federal laws impose restrictions on the utilization
of Section 163(j) excess interest expense carryforwards in the event of a change in ownership of the Company, which constitutes an 'ownership
change' as defined by Internal Revenue Code Section 382 and 383. The Company experienced an ownership change in July 2022 that
materially impacts the availability of its excess interest expense. However, since the Section 163(j) excess interest expense carryover
does not expire, there will be no limitation under Section 382 against the excess interest expense carryover in 2023. Should the Company
utilize the excess interest expense in the future, the availability of its carryforwards would be substantially restricted.

 The
Company has long-term income taxes payable primarily related to transfer pricing agreements with its foreign subsidiaries.

 Uncertain
Tax Positions

 The
Company accounts for uncertainty in income taxes in accordance with ASC 740, Income Taxes. Under ASC 740, uncertain tax positions
are evaluated in a two-step process. The Company first determines whether it is more likely than not that a tax position will be sustained
upon examination by the tax authority, including resolutions of any related appeals or litigation processes, based on technical merit.
If a tax position meets the more-likely-than-not recognition threshold it is then measured to determine the amount of benefit to recognize,
in the consolidated financial statements. The tax position is measured as the largest amount of benefit that is greater than 50% likely
of being realized upon ultimate settlement.

 The
following table summarizes the activity related to unrecognized tax benefits as follows as of December 31:

of Unrecognized Tax Benefits

 2023

 2022

 Unrecognized
 benefit-beginning of period

 $
 1,273

 $
 1,306

 Gross
 increases-prior period tax positions

 —

 Gross
 (decreases)-prior period tax positions

 —

 ( 33
)

 Unrecognized
 benefit-end of period

 $
 1,274

 $
 1,273

 As
of December 31, 2023, $ 1 of the unrecognized tax benefits are accounted for as a reduction in the Company's deferred tax assets.
Due to the Company's valuation allowance, only $ 1,274 of the $ 1,273 of unrecognized tax benefits would affect the Company's
effective tax rate, if recognized. The Company does not believe it is reasonably possible that its unrecognized tax benefits will significantly
change in the next twelve months.

 The
Company recognizes interest and penalties related to unrecognized tax benefits as income tax expense. The Company reported a tax expense
of $ 45 of interest and penalties in 2023 and the Company has accrued a liability of $ 220 for accrued interest and penalties related to
unrecognized tax benefit as of December 31, 2023.

 The
Company's material income tax jurisdictions are the United States (federal and California), China and India. As a result of net
operating loss and credit carryforwards, the Company is subject to audit for tax years 2014 and forward for California purposes and for
2017 and forward for federal tax purposes. The China and India tax years are open under the statute of limitations from 2017 and forward.

 F- 24

 Accounting
for GILTI requires companies to adopt tax accounting policies related to:

 Treating
the book-tax differences as either period costs or to recognize GILTI related deferred tax assets/liabilities in accounting for the GILTI
book-tax differences. The Company has elected to treat this difference as a period cost.

 In
the Company's valuation allowance analysis, the Company will elect the Increment Cash Tax Savings Approach in determining its U.S.
valuation allowance.

 NOTE
12 — Commitments and Contingencies

 The
terms and conditions of applicable bylaws, certificates or articles of incorporation, agreements or applicable law may obligate Sonim
under certain circumstances to indemnify its current and former directors, officers or employees, and underwriters, with respect to certain
of the matters described below and Sonim has been advancing legal fees and costs to certain current and former directors, officers, employees
and underwriters in connection with certain matters described below.

 Purchase
Commitments —The aggregate amount of noncancelable purchase orders as of December 31, 2023 and 2022, was approximately $ 13,478
and $ 19,975, respectively, and were related to the purchase of inventory and components for the Company's devices.

 Royalty
payments —The Company is required to pay per unit royalties to wireless essential patent holders and other providers of integrated
technologies on mobile devices delivered, which, in aggregate, amount to less than 5 % of net revenues associated with each unit and expire
between 2025 and 2033. Royalty expenses for the years ended December 31, 2023 and 2022, were $ 1,102 and $ 622, respectively, which are
included in Cost of Revenues on the Consolidated Statements of Operations. The Company may be required to pay additional royalties to
additional patent holders and technology providers on future products.

litigation —The Company is occasionally involved in various legal proceedings arising in the normal course of business. The
Company is not involved in any material litigation as of the date of the filing of this Annual Report on Form 10-K.

 The
results of any future litigation cannot be predicted with certainty and, regardless of the outcome, litigation can have an adverse impact
on us because of defense and settlement costs, diversion of management time and resources and other factors.

 Indemnification —Under
the terms of its agreements with wireless carriers and other partners, the Company has agreed to provide indemnification for intellectual
property infringement claims related to the Company's product sold by them to their end customers. From time to time, the Company
receives notices from these wireless carriers and other partners of a claim for infringement of intellectual property rights potentially
related to their products. These infringement claims have been settled, dismissed, have not been further pursued by the customers, or
are pending for further action by the Company.

 Contingent
severance obligations —The Company has agreements in place with certain key employees (Executive Severance Arrangements) guaranteeing
severance payments under certain circumstances. Generally, in the event of termination by the Company without cause, termination due
to death or disability, or resignation for good reason, the Company is obligated to the pay the employees in accordance with the terms
of the agreements. On July 13, 2022, Robert Tirva, the CFO and President of the Company, resigned and became eligible for $ 1,000 in severance
payments over 20 months, plus certain health insurance benefits, if he met certain requirements. The severance costs were charged to
expense as of the severance date.

 At
the beginning of 2021, the Company outsourced substantially all of its software development to a third-party and transferred 105 employees
to support the ongoing work to be performed. In connection with outsourcing its software development, the Company entered into an agreement
of future business volume over the next three years. The agreement was renegotiated in 2022 and the remaining commitment as of December
31, 2023 and 2022 is zero and $ 1,154, respectively.

 F- 25

 NOTE
13 — Net Loss Per Share

 The
following table sets forth the computation of the Company's basic and diluted net loss per share:

of Computation of Basic and Diluted Net Loss Per Share

 2023

 2022

 For
 the Years Ended

 31,

 2023

 2022

 Numerator:

 Net
 loss

 $
 ( 90
)

 $
)

 Denominator:

 Weighted-average
 shares used in computing net loss per share, basic and diluted

 41,689,386

 28,889,111

 Net
 loss per share, basic and diluted

 $
 ( 0.00
)

 $
 ( 0.49
)

 The
potentially dilutive common shares that were excluded from the calculation of diluted net loss per share because their effect would have
been antidilutive:

 Summary
of Dilutive Common Shares were Excluded from Calculation of Diluted Net Loss Per Share

 2023

 2022

 For
 the Years Ended

 31,

 2023

 2022

 subject to options to purchase common stock

 5,146,382

 4,476,215

 Unvested
 restricted stock units

 681,846

 860,888

 subject to warrants to purchase common stock

 Total

 5,828,230

 5,337,105

 NOTE
14 — Entity Level Information

 Segment
Information —The Company operates in one reporting segment.

 Operating
segments are defined as components of an enterprise about which separate financial information is evaluated regularly by the chief operating
decision maker, who is the chief operating officer, in deciding how to allocate resources and assessing performance. The Company's
chief operating decision maker allocates resources and assesses performance based upon discrete financial information at the consolidated
level.

 The
following table summarizes the revenue by region based on ship-to destinations for the periods ended:

of Revenue by Region

 2023

 2022

 For
 the Years Ended

 31,

 2023

 2022

 United
 States

 $
 33,180

 $
 29,444

 Canada
 and Latin America

 10,572

 8,975

 Europe
 and Middle East

 4,299

 1,202

 Asia Pacific

 45,581

 30,207

 Total
 net revenues

 $

 $

 Long-lived
assets located in the United States and Asia Pacific region were $ 9,365 and $ 6,861, and $ 48 and $ 168 as of December 31, 2023 and 2022,
respectively.

 F- 26

 The
composition of net revenues is as follows:

of Composition of Revenues

 2023

 2022

 For
 the Years Ended

 31,

 2023

 2022

 Product
 Sales

 $
 93,628

 $
 69,797

 Services

 Total
 net revenues

 $

 $

 Concentrations
of Revenue Risk —The Company's tablet customer accounted for 48 % and 42 % of net revenues for 2023 and 2022, respectively.
In the fourth quarter of 2023, tablet sales to this customer stopped as the product reached the end of its life cycle. After 2023, there
is no longer a significant risk due to the concentration of revenue with this customer. One additional customer accounted for 29 % and
 25 % of net revenues for 2023 and 2022, respectively.

 NOTE
15— Subsequent Events

 On
February 6, 2024, the Company executed an agreement with its tablet customer and the manufacturer of the tablets to transfer $ 11,308
of the Company's accounts receivable from the tablet customer to the tablet manufacturer in exchange for relieving the Company
of a $ 11,308 accounts payable liability with the tablet manufacturer. If this agreement had been executed as of December 31, 2023, it
would have resulted in a net $ 6,135 in accounts receivable to the Company as of December 31, 2023. As of March 27, 2024, $ 1,954 of the
tablet customer's accounts receivable balance has been paid to the Company.

 On
March 13, 2024, the Company received a notice from the Listing Qualifications Department (the "Staff") of The Nasdaq Stock
Market, LLC ("Nasdaq") notifying the Company that it has been granted a 180-day extension to regain compliance with the bid
price for its common stock to close above $ 1.00 per share for ten consecutive trading days. The Company will take appropriate action
that may include executing a reverse stock split to regain compliance with the minimum bid price rule if the Company's stock does
not stay above $1.00 prior to the end of the second 180-day period.

 F- 27