On September 21, 2026, Algorhythm Holdings, Inc. (the "Company") and Continuation Capital, Inc., a Delaware corporation ("CCI") agreed to terminate (the "Termination") the settlement agreement and stipulation (the "Settlement Agreement"), dated July 21, 2026, with respect to certain outstanding liabilities of the Company in the original principal amount of $1,928,014 (the "Claim Amount") that CCI had acquired from the former holders thereof.

Pursuant to the Settlement Agreement, the Company agreed to issue CCI up to 5,000,000 shares of the Company’s common stock, par value $0.01 per share (the "Shares"), in one or more tranches until CCI has generated aggregate proceeds equal to 120% of the Claim Amount. The Termination terminates any further obligation of the Company to issue Shares under the Settlement Agreement. The Company estimates that of the original Claim Amount, there is a remaining balance of approximately $1,418,649 due under the outstanding liabilities covered by the Settlement Agreement.