Aspira Women's Health (AWHL) Risk Analysis

The trading price of our common stock has been highly volatile. During the 12 months ended December 31, 2023, the closing trading price of our common stock ranged from a high of $8.70 per share to a low of $2.40 per share. The trading price of our common stock could continue to be subject to wide fluctuations in price in response to various factors, many of which are beyond our control, including: ?failure to significantly increase revenue and volumes of OvaSuite or Aspira Synergy;?actual or anticipated period-to-period fluctuations in financial results;?failure to achieve, or changes in, financial estimates by securities analysts;?announcements or introductions of new products or services or technological innovations by us or our competitors;?failure to complete clinical studies that validate clinical utility sufficiently to increase positive medical policy among payers at large;?publicity regarding actual or potential discoveries of biomarkers by others;?comments or opinions by securities analysts or stockholders;?the inclusion of our common stock in stock market indices such as the Russell 3000 Index;?conditions or trends in the pharmaceutical, biotechnology or life science industries;?announcements by us of significant acquisitions and divestitures, strategic partnerships, joint ventures or capital commitments;?developments regarding our patents or other intellectual property or that of our competitors;?litigation or threat of litigation;?additions or departures of key personnel;?limited daily trading volume;?our ability to continue as a going concern;?economic and other external factors, disasters or crises; and ?our announcement of future fundraisings. In addition, the stock market in general and the market for diagnostic technology companies, in particular, have experienced significant price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of those companies. These broad market and industry factors may adversely affect the market price of our common stock, regardless of our operating performance. In the past, following periods of volatility in the market price of a company's securities, securities class action litigation has often been instituted. A securities class action suit against us could result in substantial costs, potential liabilities and the diversion of our attention and our resources.

The liquidity and trading volume of our common stock has at times been low in the past and may again be low in the future. If the liquidity and trading volume of our common stock is low, this could adversely impact the trading price of our common stock and our stockholders' ability to obtain liquidity in their shares of our common stock. Our stock issuances since May 2013 have primarily involved a significant issuance of stock to a limited number of investors, significantly increasing the concentration of our share ownership in a few holders. According to publicly available information, we estimate that a total of five investors beneficially own approximately 40.0% of our outstanding common stock. In addition, pursuant to a stockholders agreement we entered into in connection with a May 2013 private placement, one of our stockholders has the right to designate a director to be nominated by us to serve on our Board of Directors, and the stockholder has not exercised this right for 2023. Furthermore, this stockholder agreement gives two investors the right to participate in future equity offerings, on the same terms as other investors. In addition, the stockholders agreement prohibits us from taking certain material actions without the consent of at least one of the primary investors in the May 2013 private placement. These material actions include: ?making any acquisition with a value greater than $2 million;?offering, selling or issuing securities senior to our common stock or any securities that are convertible into or exchangeable or exercisable for securities ranking senior to our common stock;?taking any action that would result in a change in control of the company or an insolvency event; and ?paying or declaring dividends on any of our securities or distributing any of our assets other than in the ordinary course of business or repurchasing any of our outstanding securities. The foregoing rights terminate for a primary investor when that investor ceases to beneficially own less than 50% of the shares and warrants (taking into account shares issued upon exercise of the warrants), in the aggregate, that were purchased at the closing of the 2013 private placement. We believe that the rights of one of the primary investors have so terminated. As a result of the foregoing, a limited number of stockholders will be able to affect the outcome of, or exert significant influence over, all matters requiring stockholder approval, including the election and removal of directors and any change in control involving us. In addition, this concentration of ownership of our common stock could have the effect of delaying or preventing a change in control of us or otherwise discouraging or preventing a potential acquirer from attempting to obtain control of us. This, in turn, could have a negative effect on the market price of our common stock. It could also prevent our stockholders from realizing a premium over the market prices for their shares of common stock. Moreover, the interests of this concentration of ownership may not always coincide with our interests or the interests of other stockholders. In addition, the interests of the parties to the stockholders agreement could conflict with or differ from our interests or the interests of other stockholders. The concentration of ownership also contributes to the low trading volume and volatility of our common stock.

If we are unable to maintain the listing of our common stock on the Nasdaq Capital Market 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. 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.

Our Common Stock is currently listed on the Nasdaq Capital Market and the continued listing of our Common Stock on the Nasdaq Capital Market is contingent on our continued compliance with a number of listing requirements. If we are unable to comply with the continued listing requirements of the Nasdaq Capital Market, our Common Stock would be delisted from the Nasdaq Capital Market, which would limit investors' ability to effect transactions in our Common Stock and subject us to additional trading restrictions. In order to maintain our listing, we must maintain certain share prices, financial and share distribution targets, including maintaining a minimum amount of stockholders' equity and a minimum number of public stockholders, as well as satisfying other listing requirements of the Nasdaq Capital Market. In addition to these objective standards, Nasdaq Capital Market may delist the securities of any issuer for other reasons involving the judgment of Nasdaq Capital Market. On July 1, 2024, we received a deficiency letter (the "Notice") from the Listing Qualifications Department of The Nasdaq Stock Market, LLC ("Nasdaq") stating that for the 30 consecutive business days prior to the date of the Notice, our Market Value of Listed Securities was below the minimum of $35 million required for continued listing on the Nasdaq Capital Market pursuant to Nasdaq Listing Rule 5550(b)(2) (the "MVLS Requirement"). Nasdaq has provided us with 180 calendar days, or until December 30, 2024 (the "MVLS Compliance Date"), to regain compliance with the MVLS Requirement. To regain compliance with the MVLS Requirement, the market value of our common stock must meet or exceed $35.0 million for a minimum of 10 consecutive business days during the 180-day grace period ending on the MVLS Compliance Date, unless the Staff exercises its discretion to extend this ten consecutive business day period. In the event we do not regain compliance prior to the MVLS Compliance Date, we will receive written notification that our securities are subject to delisting, at which point then we may appeal the delisting determination. There can be no assurance that we will be successful in maintaining the listing of our common stock on the Nasdaq Capital Market. On October 17, 2024, we received written notice from Nasdaq that we were not in compliance with Nasdaq Listing Rule 5550(a)(2), as the minimum bid price of our common stock had been below $1.00 per share for 30 consecutive business days. In accordance with Nasdaq Listing Rule 5810, we have a period of 180 calendar days, or until April 15, 2025, to regain compliance with the minimum bid price requirement and market value of common stock requirement. To regain compliance with the Nasdaq bid price requirement, the closing bid price of our common stock must meet or exceed $1.00 per share for at least 10 consecutive business days during this 180- calendar day period. In the event we do not regain compliance by April 15, 2025, we may be eligible for an additional 180 calendar day grace period; however, there can be no assurance that we will regain compliance with the Nasdaq continued listing requirements. There is no assurance that we will be able to maintain compliance with the Nasdaq Capital Market continued listing standards and/or continue our listing on the Nasdaq Capital Market in the future. If the Nasdaq Capital Market delists our Common Stock from trading on its exchange and we are not able to list our securities on another national securities exchange, we expect the Common Stock would qualify to be quoted on an over-the-counter market. If this were to occur, we could face significant material adverse consequences, including: - a limited availability of market quotations for our securities;- reduced liquidity for our securities;- substantially impair our ability to raise additional funds;- the loss of institutional investor interest and a decreased ability to issue additional securities or obtain additional financing in the future;- a determination that our Common Stock is a "penny stock," which will require brokers trading in our Common Stock to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for our securities;- a limited amount of news and analyst coverage; and - potential breaches of representations or covenants of our agreements pursuant to which we made representations or covenants relating to our compliance with applicable listing requirements, which, regardless of merit, could result in costly litigation, significant liabilities and diversion of our management's time and attention and could have a material adverse effect on our financial condition, business and results of operations.

Until such time, if ever, as we can generate substantial product revenues, we expect to finance our cash needs through a combination of the issuance of common stock in public or private equity offerings, debt financings, exercise of common stock warrants, collaborations, licensing arrangements, grants and government funding and strategic alliances. Our management believes the successful achievement of our business objectives will require additional financing through one or more of these avenues. To the extent that we raise additional capital through the sale of equity or convertible debt, such financing may be dilutive to stockholders. Debt financing, if available, may involve restrictive covenants and potential dilution to stockholders. Furthermore, a perception that future sales of our common stock in the public market are likely to occur could affect prevailing trading prices of our common stock. As of December 31, 2023, we had 10,645,049 shares of our common stock outstanding and 165,861 shares of our common stock reserved for future issuance to employees, directors and consultants pursuant to our employee stock plans, which excludes 759,922 shares of our common stock that were subject to outstanding options and 59,463 restricted stock units. In addition, as of December 31, 2023, warrants to purchase 799,985 shares of our common stock were outstanding. These warrants are exercisable at the election of the holders thereof, in accordance with the terms of the related Form of Warrant, at an average exercise price of $13.20 per share. On January 26, 2024, we closed a follow-on equity offering. In conjunction with the offering, certain of outstanding warrants to purchase up to an aggregate of 366,664 shares at an exercise price of $13.20 per share and a termination date of August 25, 2027, were amended so that the amended warrants have a reduced exercise price of $4.13 per share and a new termination date of January 26, 2029. The other terms of the amended warrants remain unchanged. The exercise of all or a portion of our outstanding options and warrants will dilute the ownership interests of our stockholders.