NOTE 14. RESTATEMENT OF PREVIOUSLY ISSUED CONSOLIDATED FINANCIAL STATEMENTS AND PREVIOUSLY ISSUED UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

On October 21, 2024, the Board of Directors and management, upon the recommendation of the Audit Committee of the Board of Directors concluded that the Company’s previously issued financial statements as of and for the year ended December 31, 2023, the comparative period therein as of and for the year ended December 31, 2022 and unaudited condensed consolidated financial statements as of and for each of the interim quarterly periods ended March 31, 2023, June 30, 2023 and September 30, 2023 should no longer be relied upon due to misstatements that are described below and that we would restate such financial statements to make the necessary accounting corrections. The Company evaluated the materiality of these errors both qualitatively and quantitatively in accordance with Staff Accounting Bulletin (“SAB”) No. 99, Materiality and SAB No. 108, Considering the Effects of Prior Year Misstatements in Current Year Financial Statements, and determined the effect of these corrections were material to each period discussed above. As a result of the material misstatements, we have restated our previously issued financial statements for the periods referenced above, in accordance with ASC 250, Accounting Changes and Error Corrections.

We have determined that these errors were the result of a material weakness in internal control over financial reporting that is reported in management’s report on internal control over financial reporting as of December 31, 2023 in Part II, Item 9A, “Controls and Procedures” of this Amendment No. 4 on Form 10-K/A.

The Company has not filed, and does not intend to file, amendments to the previously filed Quarterly Reports on Form 10-Q for the quarters ended March 31, 2023, June 30, 2023 and September 30, 2023, but instead is restating its unaudited interim condensed consolidated financial statements in this Amendment No. 4 on Form 10-K/A.

The restatements for the Company's previously issued financial statements as of and for the year ended December 31, 2023, the comparative period herein as of and for the year ended December 31, 2022 and for each of the quarterly periods ended March 31, 2023, June 30, 2023 and September 30, 2023, include the following:

(i)

as of and for the year ended December 31, 2022 (i.e. the comparative period included herein) to (i) account for the Legacy Nuburu Convertible Notes at fair value resulting in the recording of a loss related to the change in the fair value of, and corresponding increase to, the carrying value of these convertible notes, and (ii) (a) reclassify the Company's convertible preferred stock that is redeemable at a future point in time from permanent equity to mezzanine equity and (b) increase the carrying value of such preferred stock to reflect the redemption value of the outstanding preferred stock.

(ii)

as of and for the year ended December 31, 2023, including the interim periods therein as of March 31, 2023, June 30, 2023 and September 30, 2023, to (i) reclassify convertible preferred stock that is redeemable at a future point in time from permanent equity to mezzanine equity, and (ii) increase the carrying value of such preferred stock to reflect the redemption value of the outstanding preferred stock. Additionally, the impact of the recording of the loss related to the change in the fair value of the Legacy Nuburu Convertible Notes for the year ended December 31, 2022 described above will be reflected as an adjustment to accumulated deficit and additional paid-in capital for these periods.

The consolidated statements of cash flows have been excluded from the financial statements presented below as they were only impacted by adjustments to net loss and change in fair value of warrant liabilities which are presented below in the consolidated statements of operations and comprehensive loss. The restatement had no impact on total net cash flows from operating, investing or financing activities.

Consolidated Balance Sheet


	As of December 31, 2022
	Originally Reported			Restatement Adjustment			As Restated
LIABILITIES, CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ DEFICIT
Current portion of convertible notes payable	$	7,300,000		$	15,388,097		$	22,688,097
Total current liabilities	$	14,590,504		$	15,388,097		$	29,978,601
Total liabilities	$	14,964,411		$	15,388,097		$	30,352,508

Convertible preferred stock, $0.0001 par value; 50,000,000 shares authorized; 23,237,703 shares issued and outstanding at December 31, 2022	$	-		$	4,040		$	4,040

Stockholders’ Deficit
Accumulated deficit	$	(61,192,308	)	$	(15,388,097	)	$	(76,580,405	)
Total Stockholders’ Deficit	$	(1,842,239	)	$	(15,392,137	)	$	(17,234,376	)

Consolidated Statement of Operations and Comprehensive Loss


	Year Ended December 31, 2022
	Originally Reported			Restatement Adjustment			As Restated
Change in fair value of convertible notes payable	$	-		$	(15,388,097	)	$	(15,388,097	)
Loss before provision for income taxes	$	(14,129,101	)	$	(15,388,097	)	$	(29,517,198	)
Net loss and comprehensive loss	$	(14,129,101	)	$	(15,388,097	)	$	(29,517,198	)
Net loss per common share, basic and diluted	$	(2.59	)	$	(2.82	)	$	(5.41	)


	As of March 31, 2023 (Unaudited)
	Originally Reported			Restatement Adjustment			As Adjusted
LIABILITIES, CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ DEFICIT
Convertible preferred stock, $0.0001 par value; 50,000,000 shares authorized; 3,038,905 shares issued and outstanding at March 31, 2023	$	304		$	30,388,746		$	30,389,050

Stockholders’ Deficit
Additional paid-in capital	$	66,791,282		$	(15,000,649	)	$	51,790,633
Accumulated deficit	$	(65,959,825	)	$	(15,388,097	)	$	(81,347,922	)
Total Stockholders’ Deficit	$	835,120		$	(30,389,050	)	$	(29,553,930	)


	As of June 30, 2023 (Unaudited)
	Originally Reported			Restatement Adjustment			As Restated
LIABILITIES, CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ DEFICIT
Convertible preferred stock, $0.0001 par value; 50,000,000 shares authorized; 3,038,905 shares issued and outstanding at June 30, 2023	$	304		$	30,388,746		$	30,389,050

Stockholders’ Deficit
Additional paid-in capital	$	72,049,746		$	(15,000,649	)	$	57,049,097
Accumulated deficit	$	(72,066,537	)	$	(15,388,097	)	$	(87,454,634	)
Total Stockholders’ Deficit	$	(16,399	)	$	(30,389,050	)	$	(30,405,449	)


	As of September 30, 2023 (Unaudited)
	Originally Reported			Restatement Adjustment			As Restated
LIABILITIES, CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ DEFICIT
Convertible preferred stock, $0.0001 par value; 50,000,000 shares authorized; 3,038,905 shares issued and outstanding at September 30, 2023	$	304		$	30,388,746		$	30,389,050

Stockholders’ Deficit
Additional paid-in capital	$	72,653,179		$	(15,000,649	)	$	57,652,530
Accumulated deficit	$	(77,151,838	)	$	(15,388,097	)	$	(92,539,935	)
Total Stockholders’ Deficit	$	(4,498,267	)	$	(30,389,050	)	$	(34,887,317	)

Consolidated Balance Sheet


	As of December 31, 2023
	Originally Reported			Restatement Adjustment			As Restated
LIABILITIES, CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ DEFICIT
Convertible preferred stock, $0.0001 par value; 50,000,000 shares authorized; 2,388,905 shares issued and outstanding at December 31, 2023	$	239		$	23,888,811		$	23,889,050

Stockholders’ Deficit
Additional paid-in capital	$	73,241,955		$	(8,500,714	)	$	64,741,241
Accumulated deficit	$	(81,898,692	)	$	(15,388,097	)	$	(97,286,789	)
Total Stockholders’ Deficit	$	(8,652,809	)	$	(23,889,050	)	$	(32,541,859	)