Qualstar Corporation Announces 1-For-1,000 Reverse/Forward Stock Split

IRVINE, Calif., Sept. 26, 2022

At the date of the Reverse Split, every 1,000 shares of the Company's issued and outstanding common stock were converted automatically into one issued and outstanding share of common stock. The Reverse Split affected all shareholders uniformly and did not alter any shareholder's percentage interest in the Company's equity, except to the extent that the Reverse Split resulted in a shareholder owning a fractional share. No fractional shares were issued in connection with the Reverse Split. Shareholders who would otherwise have been entitled to receive a fractional share instead became entitled to receive a cash payment equal to $2.25 per common share outstanding (or $2,250.00 per share after giving effect to the Reverse Split). However, if a shareholder held at least 1,000 shares of common stock at the time of the Reverse Split, any fractional share in such account relating to the Reverse Split were not cashed out, but instead were subject to the Forward Split, such that the shareholder's number of shares of common stock were unchanged following the Reverse/Forward Split.

At the date of the Forward Split, every one share of the Company's issued and outstanding common stock were converted automatically into 1,000 issued and outstanding shares of common stock. The Forward Split affected all shareholders uniformly and did not alter any shareholder's percentage interest in the Company's equity.

All options of the Company outstanding immediately prior to the Reverse Split were appropriately adjusted by dividing the number of shares of common stock into which the options were exercisable or convertible by 1,000 and multiplying the exercise or conversion price thereof by 1,000. Thereafter, all options of the Company outstanding following the Reverse Split, but immediately prior to the Forward Split, were appropriately adjusted by multiplying the number of shares of common stock into which the options were exercisable or convertible by 1,000 and dividing the exercise or conversion price thereof by 1,000.

Shareholders with shares in brokerage accounts should direct any questions concerning the Reverse/Forward Split to their broker; all other shareholders may direct questions to the Company's transfer agent, Equiniti, at EQ Shareowner Services toll-free at 1-866-877-6270.

By written consent of the Board of Directors of the Company dated June 27, 2022, and by written consent of the holders of a majority of the Company's outstanding shares of common stock dated June 27, 2022, the Board and shareholders approved the Reverse/Forward Split and the two amendments of the Company's Articles of Incorporation. A Certificate of Amendment of Restated Articles of Incorporation of the Company relating to the Reverse Split was filed with the California Secretary of State on September 14, 2022, and a Certificate of Amendment of Restated Articles of Incorporation of the Company relating to the Forward Split was filed with the California Secretary of State on September 19, 2022.

About Qualstar Corporation