Document And Entity Information
Document And Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Aug. 26, 2024 | Jun. 30, 2023 | |
Document Information [Line Items] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2023 | ||
Document Transition Report | false | ||
Entity File Number | 000-55838 | ||
Entity Registrant Name | Wrap Technologies, Inc. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 98-0551945 | ||
Entity Address, Address Line One | 1817 W 4th Street | ||
Entity Address, City or Town | Tempe | ||
Entity Address, State or Province | AZ | ||
Entity Address, Postal Zip Code | 85281 | ||
City Area Code | 800 | ||
Local Phone Number | 583-2652 | ||
Title of 12(b) Security | Common Stock, par value $0.0001 per share | ||
Trading Symbol | WRAP | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | No | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | false | ||
Document Financial Statement Error Correction [Flag] | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 59,512,072 | ||
Entity Common Stock, Shares Outstanding (in shares) | 45,860,545 | ||
Auditor Firm ID | 7000 | ||
Auditor Name | HTL International, LLC | ||
Auditor Location | Houston, TX | ||
Entity Central Index Key | 0001702924 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2023 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 3,955 | $ 5,330 |
Short-term investments | 7,500 | 13,949 |
Accounts receivable and contract assets, net | 3,025 | 2,830 |
Inventories, net | 5,794 | 3,975 |
Prepaid expenses and other current assets | 953 | 775 |
Total current assets | 21,227 | 26,859 |
Property and equipment, net | 509 | 758 |
Operating lease right-of-use asset, net | 2,256 | 285 |
Intangible assets, net | 2,648 | 2,569 |
Goodwill | 1,610 | 0 |
Other assets | 251 | 100 |
Total assets | 28,501 | 30,571 |
Current liabilities: | ||
Accounts payable | 1,110 | 1,419 |
Accrued liabilities | 692 | 1,463 |
Customer deposits | 1,002 | 0 |
Operating lease liability - short term | 616 | 108 |
Warrants | 19,703 | 0 |
Total current liabilities | 23,530 | 3,156 |
Long-term liabilities: | ||
Operating lease liability - long term | 1,671 | 193 |
Total long-term liabilities | 1,808 | 360 |
Total liabilities | 25,338 | 3,516 |
Commitments and Contingencies | ||
Stockholders' equity: | ||
Common stock - 150,000,000 authorized; par value $0.0001 per share; 43,855,503 and 41,175,993 shares issued and outstanding at December 31, 2023 and 2022, respectively | 4 | 4 |
Additional paid-in capital | 99,131 | 94,333 |
Accumulated deficit | (97,988) | (67,376) |
Accumulated other comprehensive income | 0 | 94 |
Total stockholders' equity | 3,163 | 27,055 |
Total liabilities and stockholders' equity | 28,501 | 30,571 |
Undesignated [Member] | ||
Stockholders' equity: | ||
Preferred stock - 5,000,000 authorized; par value $0.0001 per share | 0 | 0 |
Convertible Preferred Stock [Member] | ||
Stockholders' equity: | ||
Preferred stock - 5,000,000 authorized; par value $0.0001 per share | 2,016 | 0 |
Extended Warranties and Services, VR, and Training [Member] | ||
Current liabilities: | ||
Deferred revenue- short term | 407 | 166 |
Long-term liabilities: | ||
Deferred revenue- long term | $ 137 | $ 167 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - $ / shares | Dec. 31, 2023 | Dec. 31, 2022 |
Preferred Stock, Shares Authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred Stock, Par or Stated Value Per Share (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common Stock, Shares Authorized (in shares) | 150,000,000 | 150,000,000 |
Common Stock, Par or Stated Value Per Share (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common Stock, Shares, Issued (in shares) | 43,855,503 | 41,175,993 |
Common Stock, Shares, Outstanding, Ending Balance (in shares) | 43,855,503 | 41,175,993 |
Convertible Preferred Stock [Member] | ||
Preferred Stock, Shares Authorized (in shares) | 10,000 | 10,000 |
Preferred Stock, Par or Stated Value Per Share (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred Stock, Shares Issued (in shares) | 9,898 | 0 |
Preferred Stock, Shares Outstanding (in shares) | 9,898 | 0 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Revenues: | ||
Product sales | $ 5,337 | $ 7,481 |
Other revenue | 796 | 568 |
Total revenues | 6,133 | 8,049 |
Total cost of revenues | 3,227 | 4,315 |
Gross profit | 2,906 | 3,734 |
Total operating expenses | ||
Selling, general and administrative | 18,361 | 16,386 |
Research and development | 3,267 | 5,078 |
Total operating expenses | 21,628 | 21,464 |
Loss from operations | (18,722) | (17,730) |
Interest income | 375 | 52 |
Change in fair value of warranty liabilities | (11,986) | 0 |
Other | 113 | 61 |
Total other income (expense), net | (11,498) | 113 |
Net loss | (30,220) | (17,617) |
Less: convertible preferred stock dividends | (392) | 0 |
Net loss attributable to common stockholders | $ (30,612) | $ (17,617) |
Net loss per basic and diluted common share (in dollars per share) | $ (0.72) | $ (0.43) |
Weighted average common shares used to compute net loss per basic and diluted common share (in shares) | 42,324,190 | 41,174,812 |
Comprehensive loss: | ||
Net loss | $ (30,612) | $ (17,617) |
Net unrealized gain on short-term investments | 0 | 100 |
Comprehensive loss | $ (30,612) | $ (17,517) |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Common Stock [Member] | Preferred Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | AOCI Attributable to Parent [Member] | Total |
Balance (in shares) at Dec. 31, 2021 | 40,851,945 | (6) | 41,264 | |||
Balance at Dec. 31, 2021 | $ 4 | $ 0 | $ 91,025 | $ (49,759) | ||
Common shares issued upon exercise of stock options (in shares) | 55,500 | 0 | ||||
Common shares issued upon exercise of stock options | $ 0 | $ 0 | 83 | 0 | $ 0 | $ 83 |
Share-based compensation expense | $ 0 | $ 0 | 3,225 | 0 | 0 | 3,225 |
Common shares issued upon vesting of restricted stock units (in shares) | 268,548 | 0 | ||||
Common shares issued upon vesting of restricted stock units | $ 0 | $ 0 | 0 | 0 | 0 | 0 |
Net unrealized gain on short-term investments | 0 | 0 | 0 | 0 | 100 | 100 |
Net loss for the period | 0 | 0 | 0 | (17,617) | 0 | (17,617) |
Net loss for the period | $ 0 | $ 0 | 0 | (17,617) | 0 | (17,617) |
Balance at December 31, 2022 (in shares) at Dec. 31, 2022 | 41,175,993 | 0 | ||||
Balance at December 31, 2022 at Dec. 31, 2022 | $ 4 | $ 0 | 94,333 | (67,376) | 94 | $ 27,055 |
Common shares issued upon exercise of stock options (in shares) | 123,056 | 0 | 123,056 | |||
Common shares issued upon exercise of stock options | $ 0 | 208 | 0 | 0 | $ 208 | |
Share-based compensation expense | $ 0 | 2,400 | 0 | 0 | $ 2,400 | |
Common shares issued upon vesting of restricted stock units (in shares) | 1,056,360 | 0 | 0 | |||
Common shares issued upon vesting of restricted stock units | $ 0 | 0 | 0 | 0 | ||
Net unrealized gain on short-term investments | $ 0 | |||||
Net loss for the period | 0 | 0 | (30,220) | 0 | (30,220) | |
Dividends on convertible preferred stock (in shares) | 173,654 | |||||
Dividends on convertible preferred stock | $ 0 | (392) | 0 | (160) | ||
Dividends on convertible preferred stock | 232 | |||||
Convertible preferred stock issued, net of offering costs (in shares) | 0 | 10,000 | ||||
Convertible preferred stock issued, net of offering costs | $ 2,036 | 0 | 0 | 0 | 2,036 | |
Common shares issued upon convertible preferred stock exercising conversion rights (in shares) | 76,440 | |||||
Common shares issued upon convertible preferred stock exercising conversion rights (in shares) | (102) | |||||
Common shares issued upon convertible preferred stock exercising conversion rights | $ (20) | |||||
Common shares issued upon convertible preferred stock exercising conversion rights | 20 | 0 | 0 | 0 | ||
Issuance of common stock for acquisition (in shares) | 1,250,000 | 0 | ||||
Issuance of common stock for acquisition | $ 0 | 1,938 | 0 | 0 | 1,938 | |
Settlement – US Treasury bills | 0 | 0 | 0 | (94) | (94) | |
Net loss for the period | $ 0 | 0 | (30,220) | 0 | (30,220) | |
Balance at December 31, 2022 (in shares) at Dec. 31, 2023 | 43,855,503 | 9,898 | ||||
Balance at December 31, 2022 at Dec. 31, 2023 | $ 4 | $ 2,016 | $ 99,131 | $ (97,988) | $ 0 | $ 3,163 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Cash Flows From Operating Activities: | ||
Net loss for the period | $ (30,220) | $ (17,617) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 823 | 762 |
Write off of intangibles | 700 | 0 |
Share-based compensation | 1,985 | 3,225 |
Warranty provision | 116 | 210 |
Change in fair value of warrant liabilities | 11,986 | 0 |
Non-cash lease expense | 177 | 101 |
Provision for doubtful accounts | 180 | 72 |
Write off of accounts receivable | 413 | 0 |
Inventory obsolescence reserve | 465 | 0 |
Changes in assets and liabilities: | ||
Accounts receivable | (696) | 957 |
Inventories | (2,224) | (2,410) |
Prepaid expenses and other current assets | (179) | 93 |
Accounts payable | (617) | (360) |
Operating lease liability | (160) | (91) |
Customer deposits | 1,002 | (43) |
Accrued liabilities and other | (344) | 611 |
Warranty settlement | (169) | (181) |
Deferred revenue | 210 | 68 |
Changes in other non-current assets | (151) | 0 |
Net cash used in operating activities | (16,703) | (14,603) |
Cash Flows From Investing Activities: | ||
Purchases of short-term investments | (10,000) | (30,466) |
Proceeds from maturities of short-term investments | 16,355 | 46,600 |
Capital expenditures for property and equipment | (230) | (256) |
Net cash paid for acquisition of Intrensic | (554) | 0 |
Proceeds from long-term deposits | 0 | (92) |
Net cash provided by investing activities | 5,178 | 14,913 |
Cash Flows From Financing Activities: | ||
Proceeds from exercise of stock options | 208 | 83 |
Proceeds from issuance of warrants and convertible preferred stock, | 10,000 | 0 |
Dividends settled in cash | (58) | 0 |
Net cash provided by financing activities | 10,150 | 83 |
Net (decrease) increase in cash and cash equivalents | (1,375) | 393 |
Cash and cash equivalents, beginning of period | 5,330 | 4,937 |
Cash and cash equivalents, end of period | 3,955 | 5,330 |
Supplemental Disclosure of Non-Cash Investing and Financing Activities: | ||
Change in unrealized gain on short-term investments | (94) | 100 |
Right-of-use asset and liability recorded during period | 2,109 | 234 |
Issuance of common stock for acquisition | 1,938 | 0 |
Net assets acquired from acquisition | 2,491 | 0 |
Dividends on convertible preferred stock | (334) | 0 |
Dividends settled with common stock | 232 | 0 |
Patents and Trademarks [Member] | ||
Cash Flows From Investing Activities: | ||
Investment in patents and trademarks | (393) | (173) |
Intangibles Other than Patents and Trademarks [Member] | ||
Cash Flows From Investing Activities: | ||
Investment in patents and trademarks | $ 0 | $ (700) |
Insider Trading Arrangements
Insider Trading Arrangements | 12 Months Ended |
Dec. 31, 2023 | |
Insider Trading Arr Line Items | |
Material Terms of Trading Arrangement [Text Block] | None. |
Rule 10b5-1 Arrangement Terminated [Flag] | false |
Rule 10b5-1 Arrangement Adopted [Flag] | false |
Non-Rule 10b5-1 Arrangement Terminated [Flag] | false |
Non-Rule 10b5-1 Arrangement Adopted [Flag] | false |
Note 1 - Organization and Summa
Note 1 - Organization and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2023 | |
Notes to Financial Statements | |
Organization, Consolidation, Basis of Presentation, Business Description and Accounting Policies [Text Block] | 1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Organization and Business Description Wrap Technologies, Inc., a Delaware corporation (the “ Company we us our Common Stock Nasdaq Principles of Consolidation The Company has two VR Basis of Presentation and Use of Estimates The accompanying financial statements have been prepared on the accrual basis of accounting in conformity with accounting principles generally accepted in the United States of America (“ US GAAP Concentrations of Risk Credit Risk Concentrations of Accounts Receivable and Revenue Concentration of Suppliers Cash and Cash Equivalents The Company considers all highly liquid investments purchased with original maturities of three months or less from the purchase date to be cash equivalents. Cash equivalents consist primarily of amounts invested in Money Market Funds and US (“ US Short-Term Investments The Company’s short-term investments consist of certificates of deposits and US Treasury bills with original maturities beyond three months at the date of purchase and one year or less from the balance sheet date. As of December 31, 2023, all of the Company’s short-term investments were classified as available-for-sale and are carried at estimated fair value with any unrealized gains and losses, unrelated to credit loss factors, included in other comprehensive income in our consolidated statements of stockholders’ equity. Share-Based Compensation The Company follows the fair value recognition provisions issued by the FASB in ASC Topic 718, Stock Compensation (“ ASC 718 ASU Loss per Share Basic loss per share (EPS) is computed by dividing net loss, less any dividends, accretion or decretion, redemption or induced conversion, if any, on our Series A Convertible Preferred Stock, by the weighted average number of shares outstanding during the reported period. In computing diluted EPS, we adjust the numerator used in the basic EPS computation, subject to anti-dilution requirements, to add back the dividends (declared or cumulative undeclared) applicable to the Series A Convertible Preferred Stock. Such add-back would also include any adjustments to equity in the period to accrete the Series A Convertible Preferred Stock to its redemption price, or recorded upon a redemption or induced conversion, if any. We adjust the denominator used in the basic EPS computation, subject to anti-dilution requirements, to include the dilution from potential shares resulting from the issuance of the Series A Convertible Preferred Stock, restricted stock units, and stock options. Stock options and restricted stock units exercisable or issuable for a total of 5,468,223 and 6,413,731 shares of Common Stock were outstanding at December 31, 2023 and 2022, respectively. These securities are not included in the computation of diluted net loss per common share for the periods presented as their inclusion would be antidilutive due to losses incurred by the Company. Accounts Receivable and Allowance for Credit Losses ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326) At December 31, 2023 and 2022, the Company had an allowance for credit losses related to accounts receivable of $386 and $205, respectively. If a major customer’s creditworthiness deteriorates, or actual defaults exceed our historical experience, such estimates could change and impact our future reported financial results. Inventories Inventories are valued at the lower of cost or net realizable value. The cost of substantially all the Company’s inventory is determined by the FIFO cost method. Inventory is comprised of raw materials, assemblies and finished products intended for sale to customers . As of December 31, 2023 and 2022 the Company had $465 and $0 reserves, respectively for obsolescence. Property, Equipment and Depreciation Property and equipment is stated at cost. Depreciation on property and equipment is computed over the estimated useful lives of three Business Combinations The Company accounts for its business combinations under the provisions of Accounting Standards Codification ("ASC") Topic 805-10, Business Combinations ("ASC 805-10"), which requires that the purchase method of accounting be used for all business combinations. Assets acquired and liabilities assumed, including non-controlling interests, are recorded at the date of acquisition at their respective fair values. The estimated fair value of net assets acquired, including the allocation of the fair value to identifiable assets and liabilities, was determined using established valuation techniques. ASC 805-10 also specifies criteria that intangible assets acquired in a business combination must meet to be recognized and reported apart from goodwill. Goodwill represents the excess purchase price over the fair value of the tangible net assets and intangible assets acquired in a business combination. Acquisition-related expenses are recognized separately from the business combinations and are expensed as incurred. The estimated fair value of the acquired intangible assets was determined using a method which reflects the present value of the operating cash flows generated by this asset after taking into account the cost to realize the revenue, and an appropriate discount rate to reflect the time value and risk associated with the invested capital. Certain adjustments to the assessed fair values of the assets and liabilities made subsequent to the acquisition date, but within the measurement period, which is up to one year, are recorded as adjustments to goodwill. Any adjustments subsequent to the measurement period are recorded in income. Goodwill Goodwill represents the difference, if any, between the aggregate consideration paid for an acquisition and the fair values of the underlying net assets and liabilities assumed from an acquired business. Goodwill is not amortized, but instead is tested for impairment. The Company tests goodwill for impairment on an annual basis during the fourth quarter, or more frequently if conditions indicate that such impairment could exist. The Company evaluates qualitative factors to determine if it is more likely than not that the fair value of a reporting unit is less than its carrying value and whether it is necessary to perform goodwill impairment process. Definite-lived Intangible Assets Definite-lived intangible assets represent certain trade names, patents, licenses, software, acquired technology and customer relationships. Definite-lived intangible assets are recorded at cost less any accumulated amortization and accumulated impairment losses, if any. Definite-lived intangible assets acquired through the business combination are measured at fair value at the acquisition date. The Company amortizes these acquired definite-lived intangibles assets with a finite life on a straight-line basis, over 6 years for technology; 7 years for customer relationships; and 8 years for trademarks and trade names. Intangible Assets Intangible assets consist of (a) capitalized legal fees and filing costs related to obtaining patents and trademarks, (b) tradenames and software, (c) purchased software, and (d) the purchase cost of indefinite-lived website domains. The estimated useful lives of identifiable intangible assets with definite useful lives have been estimated to be between one and twenty years. Purchased website domain costs with an indefinite useful life are not subject to amortization, but are subject to an annual impairment test, by comparing their carrying amount with their corresponding fair value. For any given intangible asset with an indefinite useful life, if its fair value exceeds its carrying amount no impairment loss shall be recognized. The carrying value of intangibles is periodically reviewed and impairments, if any, are recognized when the future undiscounted cash flows realized from the assets is less than its carrying value. Impairment of Long-Lived Assets Long-lived assets and identifiable intangibles held for use are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If the sum of undiscounted expected future cash flows is less than the carrying amount of the asset or if changes in facts and circumstances indicate, an impairment loss is recognized and measured using the asset’s fair value. In December 2023, it was determined that the intangible related to development of proprietary software by Lumeto, Inc. would not have future economic value and was written down; the Company recognized an impairment loss of $700. The Company did not recognize any impairment loss during the year ended December 31, 2022. Warrants The Company accounts for warrants as liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in Financial Accounting Standards Board (“ FASB ASC ASC ASC For issued warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded at their initial fair value on the date of issuance, and each balance sheet date thereafter. The Company accounts for the warrants issued in accordance with the guidance contained in ASC 815-40-15-7C, under which the warrants do not meet the criteria for equity treatment and must be recorded as liabilities. Accordingly, the Company classifies the warrants as liabilities at their fair value and adjusts the warrants to fair value at each reporting period. This liability is subject to re-measurement at each balance sheet date until exercised, and any change in fair value is recognized in the Company’s condensed consolidated statement of operations. Convertible Preferred Stocks The Company evaluates and accounts for conversion options embedded in its convertible instruments in accordance with ASC 480 and ASC 815 to determine if those instruments or embedded components of those instruments qualify as derivatives and are subject to bifurcation accounting. The Company determines that the economic characteristics and risks of the embedded derivative instrument are clearly and closely related to the economic characteristics and risks of the host contract. The convertible instruments are accounted for as a single hybrid instrument. Additionally, the convertible instruments do not have any redemption features that would preclude permanent equity classification in accordance with the guidance contained in ASC 480-10-S99. Advertising and Promotion Costs Advertising costs are charged to expense as incurred and were $925 and $426 for the years ended December 31, 2023 and 2022, respectively. The Company also incurred product promotion costs for demonstration products delivered to prospective customers of $225 and $688 for the years ended December 31, 2023 and 2022, respectively. Advertising and promotion costs are included in selling, general and administrative expenses in the accompanying statements of operations. Demonstration and Training Costs The Company maintains a demonstration and training department as a part of its sales and marketing activities and does not charge for product demonstrations or training. Training is not a condition or requirement of sale as most sales are made through distributors to their end customers. The Company conducts local and regional in-person, webinar and on-line demonstrations and use of force and escalation training to support law enforcement agencies with no purchase requirement. Such training, when provided, may occur before or after initial or subsequent purchase or field deployment of the Company’s products. The Company believes that law enforcement trainers and officers that have seen demonstrations or have been trained about its products are more supportive of their departments purchase and deployment of product. Research and Development Costs Research and development costs are expensed as incurred. Contract Manufacturers The Company employs contract manufacturers for production of certain components and sub-assemblies. The Company may provide parts and components to such parties from time to time but recognizes no revenue or markup on such transactions. Leases The Company adopted ASC Topic 842, Leases (“ Topic 842 Revenue Recognition The Company adopted ASC Topic 606, Revenue from Contracts with Customers on January 1, 2018. The Company enters into contracts that include various combinations of products, accessories, software and services, each of which are generally distinct and are accounted for as separate performance obligations. Product sales include BolaWrap products and accessories. Other revenue includes VR revenues, service, training and shipping revenues. The timing of revenue recognition may differ from the timing of invoicing to customers. The Company generally has an unconditional right to consideration when customers are invoiced, and a receivable is recorded. A contract asset is recognized when revenue is recognized prior to invoicing, or a contract liability (deferred revenue) when revenue will be recognized subsequent to invoicing. The Company recognizes an asset if there are incremental costs of obtaining a contract with a customer such as commissions. These costs are ascribed to or allocated to the underlying performance obligations in the contract. The Company may receive consideration, per terms of a contract, from customers prior to transferring goods to the customer. The Company records customer deposits as a contract liability. Additionally, the Company may receive payments, most typically for service and warranty contracts, at the onset of the contract and before the services have been performed. In such instances, a deferred revenue liability is recorded. The Company recognizes these contract liabilities as revenue after all revenue recognition criteria are met. Estimated costs for the Company’s standard warranty, generally one-year, are charged to cost of products sold when revenue is recorded for the related product. Royalties are also charged to cost of products sold. Shipping and Handling Costs Shipping and handling costs are included in cost of revenues. Shipping and handling costs invoiced to customers are included in revenue. Actual shipping and handling costs were $200 and $296 for the years ended December 31, 2023 and 2022, respectively. Actual revenues from shipping and handling were $37 and $109 for the years ended December 31, 2023 and 2022, respectively. Warranty Reserves The Company warrants its products and accessories to be free from defects in materials and workmanship for a period of one year from the date of purchase. The warranty is generally limited. The Company currently provides direct warranty service. International market warranties are generally similar to the US market. The Company establishes a warranty reserve based on anticipated warranty claims at the time product revenues are recognized. Factors affecting warranty reserve levels include the number of units sold, anticipated cost of warranty repairs and anticipated rates of warranty claims. The Company evaluates the adequacy of the provision for warranty costs each reporting period. The warranty reserve was $72 and $125 at December 31, 2023 and 2022. Actual warranty costs could differ from estimates. Segment Information ASC Topic 280, “Segment Reporting,” requires use of the “management approach” model for segment reporting. The management approach model is based on the way a company’s management organizes segments within the company for making operating decisions and assessing performance. The Company operates as a single segment and will evaluate additional segment disclosure requirements as it expands its operations. Income Taxes No The Company maintains a valuation allowance with respect to deferred tax assets. The Company establishes a valuation allowance based upon the potential likelihood of realizing the deferred tax asset and taking into consideration the Company’s financial position and results of operations for the current period. Future realization of the deferred tax benefit depends on the existence of sufficient taxable income within the carry-forward period under the Federal tax laws. Changes in circumstances, such as the Company generating taxable income, could cause a change in judgment about the realizability of the related deferred tax asset. Any change in the valuation allowance will be included in income in the year of the change in estimates. Recently Issued Accounting Guidance The Company has reviewed recently issued, but not yet effective, accounting pronouncements and does not believe the future adoptions of any such pronouncements will be expected to cause a material impact on its financial condition or the results of operations. In July 2023, the SEC adopted the final rule under SEC Release No. 33-11216, Cybersecurity Risk Management, Strategy, Governance, and Incident Disclosure, requiring disclosure of material cybersecurity incidents on Form 8-K and periodic disclosure of a registrant’s cybersecurity risk management, strategy and governance in annual reports. Regulation S-K Item 6 disclosure requirements under this rule will be effective for us in the fourth quarter of 2023. Incident disclosure requirements in Form 8-K will be effective for us on June 15, 2024. We are still evaluating for any impact on our financial statement disclosures from the adoption of this final rule. |
Note 2 - Revenues and Product C
Note 2 - Revenues and Product Costs | 12 Months Ended |
Dec. 31, 2023 | |
Notes to Financial Statements | |
Revenue from Contract with Customer [Text Block] | 2. REVENUES AND PRODUCT COSTS Revenues consist of product revenue and other revenue. Product sales include BolaWrap products and accessories. Other revenue includes VR revenues, service, training and shipping revenues. The table below details the activity in our contract liabilities during the year ended December 31, 2023. Customer Deferred Deposits Revenue Balance at January 1, 2023 $ - $ 333 Additions, net 1,002 407 Transfer to revenue - (196 ) Balance at December 31, 2023 $ 1,002 $ 544 Current portion $ 1,002 $ 407 Long-term portion $ - $ 137 As of December 31, 2023, the Company’s deferred revenue of $544 consisted of $139 related to BolaWrap extended warranties and services, $216 related to Intrensic extended warranties and services, $171 related to VR, and $18 related to training. As of December 31, 2022, the Company’s deferred revenue of $333 consisted of $198 related to VR, $11 related to training, and $124 related to BolaWrap extended warranties and services. The Company recognizes an asset if there are incremental costs of obtaining a contract with a customer such as commissions. These costs are ascribed to or allocated to the underlying performance obligations in the contract and amortized consistent with the recognition timing of the revenue for any such underlying performance obligations. The Company had no . |
Note 3 - Asset Acquisition
Note 3 - Asset Acquisition | 12 Months Ended |
Dec. 31, 2023 | |
Notes to Financial Statements | |
Asset Acquisition [Text Block] | 3. ASSET ACQUISITIONS Pursuant to the Professional Services and Technology Acquisition Agreement (the “Services Agreement”), dated as of November 22, 2022, and as amended on April 2, 2023, by and among the Company, Lumeto, Inc. (“Lumeto”) and Spatial Industries Group, Inc. (collectively, “Service Provider”), the Service Provider provides to the Company certain technology, services, and perpetual licenses for use within the Company’s Wrap Reality virtual simulation training platform (the “Technology, Services, and License”), in consideration for a one-time cash payment upon the execution of the Services Agreement of $700, The Company determined during 2023 that the intangible related to software developed by Lumeto would not have future economic benefit and the value of the intangible was written off as a loss on impairment of $700. On August 9, 2023, the Company entered into a Membership Interest Purchase Agreement (the “Intrensic Purchase Agreement”) by and among the Company, certain members of Intrensic, including Kevin Mullins, the Company’s former Chief Executive Officer (collectively, “Sellers”) and Buford Ortale, as the Seller’s representative. Under the terms of the Intrensic Purchase Agreement, the Company agreed to purchase, and Sellers agreed to sell, 100% of the membership interests (the “Membership Interests”) of Intrensic for the following consideration upon the consummation of the sale of the Membership Interests (the “Intrensic Closing”): (i) $553,588 in cash, subject to adjustment based upon the outstanding indebtedness of Intrensic and Intrensic’s working capital as of the Intrensic Closing; and (ii) 1,250,000 shares of Common Stock of the Company the “Intrensic Acquisition”). The Intrensic Acquisition closed on August 16, 2023, in accordance with the terms of the Purchase Agreement. |
Note 4 - Financial Instruments
Note 4 - Financial Instruments | 12 Months Ended |
Dec. 31, 2023 | |
Notes to Financial Statements | |
Financial Instruments Disclosure [Text Block] | 4. FINANCIAL INSTRUMENTS Assets and liabilities recorded at fair value on a recurring basis in the Consolidated Balance Sheets and assets and liabilities measured at fair value on a non-recurring basis or disclosed at fair value, are categorized based upon the level of judgment associated with inputs used to measure their fair values. The accounting guidance for fair value provides a framework for measuring fair value and requires certain disclosures about how fair value is determined. Fair value is defined as the price that would be received upon the sale of an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date. The accounting guidance also establishes a three-level valuation hierarchy that prioritizes the inputs to valuation techniques used to measure fair value based upon whether such inputs are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect market assumptions made by the reporting entity. The three-level hierarchy for the inputs to valuation techniques is briefly summarized as follows: Level 1 Level 2 Level 3 The Company’s short-term investments consisting of US Treasury bill securities and Certificate of Deposits are classified as Level 1 because they are valued using quoted market prices. The following table shows the Company’s short-term investments by significant investment category as of December 31, 2023 and 2022. As of December 31, 2023 Adjusted Unrealized Unrealized Market Cost Gains Losses Value Level 1: Money Market Funds $ 1,793 $ - $ - $ 1,793 Certificate of Deposits 7,500 - - 7,500 Total Financial Assets $ 9,293 $ - $ - $ 9,293 As of December 31, 2022 Adjusted Unrealized Unrealized Market Cost Gains Losses Value Level 1: Money Market Funds $ 3,004 $ - $ - $ 3,004 U.S. Treasury securities in short-term investments 9,849 100 - 9,949 Certificate of Deposits 4,000 - - 4,000 Total Financial Assets $ 16,853 $ 100 $ - $ 16,953 Unrealized gains or losses resulting from our short-term investments are recorded in accumulated other comprehensive gain or loss as they are classified as available for sale. During the year ended December 31, 2023 and 2022, $0 and $100 was recorded to accumulated other comprehensive loss and gain, respectively. Warrant liabilities are measured at fair value on a recurring basis. The subsequent measurement of the warrant liabilities as of December 31, 2023, is classified as Level 3 due to the use of an observable market quote in a non-active market and the management’s assumption of the expected stock price volatility. The following table presents the fair value in the beginning of the period, the changes in the fair value, and the fair value at the end of the period of warrant liabilities: Level 3: December 31, 2023 Fair value at inception or the beginning of the period $ (7,717 ) Change in fair value of warrant liabilities (11,986 ) Fair value as of December 31, 2023 $ (19,703 ) The Company uses the modified Black-Scholes option pricing model to determine the fair value of warrant liabilities. The following table summarizes the assumptions used to compute the fair value of Warrants: As of December 31, 2023 Expected stock price volatility 143 % Risk-free interest rate 3.85 % Dividends yield 0 % Expected life of warrants (years) 4.50 Exercise price $ 1.45 Our other financial instruments also include accounts receivable, accounts payable, accrued liabilities and business acquisition liabilities. Due to the short-term nature of these instruments, their fair values approximate their carrying values on the balance sheet. |
Note 5 - Inventories
Note 5 - Inventories | 12 Months Ended |
Dec. 31, 2023 | |
Notes to Financial Statements | |
Inventory Disclosure [Text Block] | 5. INVENTORIES Inventory is recorded at the lower of cost or net realizable value. The cost of substantially all the Company’s inventory is determined by the FIFO cost method. Inventories consisted of the following: December 31, 2023 2022 Finished goods $ 3,521 $ 2,293 Raw materials 2,738 1,682 Reserve for Obsolescence (465 ) - Inventories – net $ 5,794 $ 3,975 |
Note 6 - Property and Equipment
Note 6 - Property and Equipment | 12 Months Ended |
Dec. 31, 2023 | |
Notes to Financial Statements | |
Property, Plant and Equipment Disclosure [Text Block] | 6. PROPERTY AND EQUIPMENT Property and equipment consisted of the following: December 31, 2023 2022 Production and lab equipment $ 542 $ 513 Tooling 562 448 Computer equipment 615 531 Furniture, fixtures and improvements 196 181 1,915 1,673 Accumulated depreciation (1,406 ) (915 ) Property and equipment, net $ 509 $ 758 Depreciation expense was $479 and $475 for the years ended December 31, 2023 and 2022, respectively. |
Note 7 - Intangible Assets, Net
Note 7 - Intangible Assets, Net and Goodwill | 12 Months Ended |
Dec. 31, 2023 | |
Notes to Financial Statements | |
Intangible Assets Disclosure [Text Block] | 7. INTANGIBLE ASSETS AND GOODWILL Intangible Assets Intangible assets consisted of the following: December 31, 2023 2022 Amortizable intangible assets: Patents $ 873 $ 575 Trademarks 248 150 Purchased software and technology 1,752 1,962 Customer Relationship 160 - 3,033 2,687 Accumulated amortization (806 ) (462 ) Total amortizable 2,227 2,225 Indefinite life assets (non-amortizable) 421 344 Total intangible assets, net $ 2,648 $ 2,569 Amortization expenses were $345 and $287 for the years ended December 31, 2023 and 2022, respectively. The purchase of Intrensic in August 2023 resulted in several intangible assets recognized on the balance sheet including $80 in trademarks, $490 in purchased technology and $160 in customer relationships. The Company determined in December 2023 that the intangible related to software developed by Lumeto would not have future economic benefit and the value of the intangible was written down, incurring a loss on impairment of $700. At December 31, 2023, annual amortization of intangible assets, based upon the Company’s existing intangible assets and current useful lives, is estimated to be the following: 2024 $ 427 2025 422 2026 335 2027 185 2028 185 Thereafter 673 Total estimated amortization expense $ 2,227 Goodwill The table below summarizes the changes in the carrying amount of goodwill: Balance at January 1, 2023 $ - Acquired goodwill 1,610 Balance at December 31, 2023 $ 1,610 Goodwill acquired in 2023 relates to the purchase of Intrensic in August 2023. |
Note 8 - Accounts Payable and A
Note 8 - Accounts Payable and Accrued Liabilities | 12 Months Ended |
Dec. 31, 2023 | |
Notes to Financial Statements | |
Accounts Payable and Accrued Liabilities Disclosure [Text Block] | 8. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES We are obligated to pay royalties pursuant to an exclusive Amended and Restated Intellectual Property License Agreement (the “License Agreement”), dated as of September 30, 2016, with Syzygy Licensing, LLC (“Syzygy”), a private technology invention, consulting and licensing company owned and controlled by Elwood G. Norris, a founder and former officer and current 5% stockholder of the Company, and James A. Barnes, a former officer and stockholder of the Company (see Note 16). Accounts payable includes $14 and $127 due to Syzygy pursuant to the License Agreement as of December 31, 2023 and 2022, respectively. Accrued liabilities consist of the following: December 31, 2023 2022 Patent and legal costs $ 21 $ 135 Accrued compensation 325 1,100 Warranty costs 72 125 Taxes and other 274 103 $ 692 $ 1,463 Accrued compensation includes $0 and $1,022 in employee bonuses and commissions payable at December 31, 2023 and 2022, respectively. Changes in our estimated product warranty costs were as follows: Year Ended December 31, 2023 2022 Balance, beginning of period $ 125 $ 96 Warranty settlements (169 ) (181 ) Warranty provision 116 210 Balance, end of period $ 72 $ 125 |
Note 9 - Leases
Note 9 - Leases | 12 Months Ended |
Dec. 31, 2023 | |
Notes to Financial Statements | |
Lessee, Operating Leases [Text Block] | 9. LEASES The Company determines if an arrangement is a lease at inception. The guidance in FASB ASC Topic 842, Leases ( ROU For leases beginning on or after January 1, 2019 , Amortization of ROU operating lease assets was $138 and $101 for the years ended December 31, 2023 and 2022, respectively. Operating lease expense for capitalized operating leases included in operating activities was $177 and $118 for the years ended December 31, 2023 and 2022, respectively. Operating lease obligations recorded on the balance sheet at December 31, 2023 are: Operating lease liability- short term $ 616 Operating lease liability - long term 1,671 Total Operating Lease Liability $ 2,287 Future lease payments included in the measurement of lease liabilities on the balance sheet at December 31, 2023 for future periods are as follows 2024 $ 443 2025 567 2026 507 2027 522 2028 538 Thereafter 1,271 Total future minimum lease payments 3,848 Less imputed interest (1,561 ) Total $ 2,287 The weighted average remaining lease term is 6.77 years, and the weighted average discount rate is 14.2%. Certain leases contain provisions for payment of real estate taxes, insurance and maintenance costs by the Company. These expenses are treated as variable lease payments and recognized in the period in which the obligation for those payments was incurred. The Company had $8 and $39 variable lease expenses during the year December 31, 2023 or 2022. The Company had $92 and $11 short-term lease expense during the year December 31, 2023, or 2022. The Company does not have any finance leases. |
Note 10 - Warrants
Note 10 - Warrants | 12 Months Ended |
Dec. 31, 2023 | |
Notes to Financial Statements | |
Warrants [Text Block] | 10. WARRANTS On June 29, 2023, the Company entered into a Securities Purchase Agreement (the “Series A Purchase Agreement”) with certain directors of the Company and certain accredited and institutional investors (collectively, the “Series A Investors”), pursuant to which it agreed to sell to the Series A Investors in a registered direct offering (the “Series A Offering”) (i) an aggregate of 10,000 shares of the Company’s newly-designated Series A Convertible Preferred Stock, with par value $0.0001 per share and a stated value of $1,000 per share (the “Series A Preferred Stock”), initially convertible into up to 6,896,553 shares of the Company’s common stock, at an initial conversion price of $1.45 per share (the “Conversion Price”), and (ii) warrants to acquire up to an aggregate of 6,896,553 shares of Common Stock (the “Series A Warrants”). Each Series A Warrant has an exercise price of $1.45, became exercisable after the date that was six months from the date of issuance and will expire 5 years following the date of issuance. The exercise price is subject to customary adjustments for stock dividends, stock splits, reclassifications and the like, and subject to price-based adjustment, on a “full ratchet” basis, in the event of any issuances of Common Stock, or securities convertible, exercisable or exchangeable for Common Stock, at a price below the then-applicable exercise price (subject to certain exceptions). The closing of the Offering occurred on July 3, 2023. The aggregate gross proceeds from the Offering were $10,000, of which $7,717 was allocated to the Warrants. The Company expects to use the net proceeds from the Offering for general corporate purposes. |
Note 11 - Debt
Note 11 - Debt | 12 Months Ended |
Dec. 31, 2023 | |
Notes to Financial Statements | |
Debt Disclosure [Text Block] | 11. DEBT The Company’s debt at December 31, 2023 and 2022 included operating lease liabilities (see Note 9). |
Note 12 - Stockholders' Equity
Note 12 - Stockholders' Equity | 12 Months Ended |
Dec. 31, 2023 | |
Notes to Financial Statements | |
Equity [Text Block] | 12. STOCKHOLDERS EQUITY The Company’s authorized capital consists of 150,000,000 shares of Common Stock and 5,000,000 shares of preferred stock, par value $0.0001 per share (“Preferred Stock”), of which 10,000 are designated as Series A Preferred Stock. On July 3, 2023, the Company filed the Certificate of Designations with the State of Delaware, designating 10,000 shares of its Preferred Stock as Series A Convertible Preferred Stock. The terms of the Series A Preferred Stock are as set forth in the form of Certificate of Designations of the Series A Preferred Stock (the “Certificate of Designations”). The Series A Preferred Stock is convertible into shares of common stock (the “Conversion Shares”) at the election of the holder at any time at an initial conversion price of $1.45. The Conversion Price is subject to customary adjustments for stock dividends, stock splits, reclassifications and the like, and subject to price-based adjustment in the event of any issuances of common stock, or securities convertible, exercisable or exchangeable for common stock, at a price below the then-applicable Conversion Price (subject to certain exceptions). The holders of the Series A Preferred Stock are entitled to dividends of 8% per annum, compounded monthly, which are payable in cash or shares of Common Stock, or a combination thereof, at the Company’s option in accordance with the terms of the Certificate of Designations. Upon the occurrence and during the continuance of a Triggering Event (as defined in the Certificate of Designations), the Series A Preferred Stock will accrue dividends at the rate of 20% per annum. If the Company elects to pay any dividends in shares of Common Stock, the Conversion Price used to calculate the number of shares issuable will equal to the lower of (i) the then applicable Conversion Price and (ii) 85% of the arithmetic average of the three (3) lowest closing prices of the Common Stock during the twenty (20) consecutive trading day period ending on the trading day immediately preceding the dividend payment date, provided that such price shall not be lower than the lower of (x) $0.2828 (subject to adjustment for stock splits, stock dividends, stock combinations, recapitalizations or other similar events ) and (y) 20% of the “Minimum Price” (as defined in Nasdaq Stock Market Rule 5635) on the date of the Stockholder Approval (subject to adjustment for stock splits, stock dividends, stock combinations, recapitalizations or other similar events) or, in any case, such lower amount as permitted, from time to time, by the Nasdaq Stock Market. The holders of the Series A Preferred Stock have no voting rights, other than with respect to certain matters affecting the rights of the Series A Preferred Stock. The Company may require holders to convert their shares of Series A Preferred Stock into shares of Common Stock if the closing price of the Company’s Common Stock exceeds $8.00 per share (subject to adjustment for stock splits, stock dividends, stock combinations, recapitalizations or other similar events) for 20 consecutive trading days and the daily dollar trading volume of the Common Stock exceeds $2,000,000 per day during the same period, provided that certain equity conditions described in the Certificate of Designations are satisfied. At any time beginning 18 months from the date of the issuance, provided that provided that that the Company has filed all reports required to be filed by it pursuant to the Exchange Act on a timely basis for a continuous period of one year and provided further that certain equity conditions described in the Certificate of Designations are satisfied, the Company has the right to redeem in cash all or some of the shares of the Series A Preferred Stock outstanding at such time at a redemption price equal to the product of (x) 125% multiplied by (y) the sum of (A) the stated value of the Series A Preferred Stock plus (B) all declared and unpaid Dividends on such Preferred Stock and any other unpaid amounts then due and payable hereunder with respect to such Series A Preferred Stock, plus (C) the make-whole amount, plus (D) any accrued and unpaid late charges with respect to such stated value and amounts payable pursuant to clause (B) as of such date of determination. On August 19, 2024, the Company entered into an Amendment Agreement (the “Series A Amendment”) with the Required Holders (as defined in the Certificate of Designations). Pursuant to the Series A Amendment, the Required Holders agreed that (A) the unpaid and accrued dividends on the Series A Preferred Stock due July 1, 2024 (the “July Delinquent Dividend Amount”), shall be payable, at the option of the Company, in (i) cash and/or (ii) shares of Common Stock, at a price per share of Common Stock equal to the lower of (x) $1.00 and (y) the Dividend Conversion Price (as defined in the Certificate of Designations), using July 1, 2024, as the applicable date of determination in accordance with the Certificate of Designations; (B) the dividends due on October 1, 2024 (the “October Dividend Amount” and, together with the July Delinquent Dividend Amount, the “Delinquent Dividend Amounts”), shall be payable in shares of Common Stock based on a per share price of Common Stock equal to 80% of the arithmetic average of the three (3) lowest closing sale prices of the Common Stock during the month of September 2024; and (C) such Delinquent Dividend Amounts and any Dividend Balance Shares (as defined in the Certificate of Designations), with respect thereto, if applicable, shall be delivered on October 1, 2024. The Company and the Required Holders further agreed pursuant to the Agreement to amend (i) the Certificate of Designations, as described below, by filing a Certificate of Amendment to the Certificate of Designations (the “Certificate of Amendment”) and (ii) the Series A Purchase Agreement to amend the definition of “Excluded Securities.” The Certificate of Amendment amends the Certificate of Designations to, among other things, (A) allow for the payment of dividends in the form of Common Stock to a holder of the Series A Preferred Stock who serves as a director, officer or employee of the Company; provided that such issuance is approved by the Company’s stockholders prior to such issuance, and (B) amend certain conditions required for (i) a mandatory conversion of the Series A Preferred Stock, and (ii) the Company’s right to redeem, all or a portion, of the Series A Preferred Stock outstanding pursuant to an optional redemption, in each case, pursuant to the terms of the Certificate of Designations. The Certificate of Amendment was filed with the Secretary of State of the State of Delaware on August 23, 2024. $2,036 of the net proceeds less transaction cost of the Series A Purchase Agreement was allocated to the Series A Preferred Stock. For the year ended December 31, 2023, authorized and declared dividends totaling $392 of which $58 was paid in cash $232 was paid in shares of the Company’s Common Stock and the balance of $102 was accrued in payables as of December 31, 2023. As of December 31, 2023, 102 Shares of Series A Preferred Stock were converted into approximately 77 thousand shares of Common Stock. The Company’s failure to timely file its Annual Report on Form 10-K for the year ended December 31, 2023, its Quarterly Report on Form 10-Q for the quarter ended March 31, 2024 and its Quarterly Report on Form 10-Q for the quarter ended June 30, 2024, each constituted a Triggering Event (the “Filing Triggering Events”) and equity conditions failures pursuant to the terms of the Certificate of Designations. As a result, the dividend rate of the Series A Preferred Stock was automatically increased to 20% per annum beginning on April 16, 2024, or the filing deadline of the Form 10-K for the year ended December 31, 2023, and shall continue until such date as the Filing Triggering Event is cured. As of the date of this Annual Report on Form 10-K for the year ended December 31, 2023, the Filing Triggering Event has not been cured. |
Note 13 - Share-based Compensat
Note 13 - Share-based Compensation | 12 Months Ended |
Dec. 31, 2023 | |
Notes to Financial Statements | |
Share-Based Payment Arrangement [Text Block] | 13. SHARE-BASED COMPENSATION On March 31, 2017, the Company adopted, and the stockholders approved, the 2017 Stock Incentive Plan (the “ Plan The Company generally recognizes share-based compensation expense on the grant date and over the period of vesting or period that services will be provided. In April 2023, the Company recognized severance acceleration of $112 of share-based compensation expense resulting from the resignation of the Company’s former Chief Executive Officer and Chief Operating Officer due to a reduction in force that resulted in changes in the composition of the executives of the Company. The following table summarizes stock option activity for the year ended December 31, 2023: Weighted Average Options on Remaining Aggregate Common Exercise Contractual Intrinsic Shares Price Term Value Outstanding January 1, 2023 5,491,399 $ 3.72 5.96 $ 92 Granted 2,592,309 $ 1.68 Exercised (123,056 ) $ 1.69 Forfeited, cancelled, expired (3,303,017 ) $ 3.80 Outstanding December 31, 2023 4,657,635 $ 2.52 8.75 $ 3,979 Exercisable December 31, 2023 1,160,580 $ 4.02 7.86 $ 274 At December 31, 2023, there were 2,675,071 service-based stock options outstanding, and 1,982,564 performance-based stock options outstanding, of which 692,398 performance-based stock options were granted in April 2022 to the Company’s previous Chief Executive Officer and 1,290,166 were granted in October 2023 to the Company's current Chief Executive Officer subject to future market capitalization targets. The Company uses the Black-Scholes option pricing model to determine the fair value of service-based options granted. The following table summarizes the assumptions used to compute the fair value of options granted to employees and non-employees: For the Year Ended December 31, 2023 2022 Expected stock price volatility 76 % 49 % Risk-free interest rate 4.21 % 2.47 % Forfeiture rate 0 % 0 % Expected dividend yield 0 % 0 % Expected life of options – years 6.00 5.96 Weighted-average fair value of options granted $ 1.33 $ 0.88 Estimated volatility is a measure of the amount by which the Company’s stock price is expected to fluctuate each year during the expected life of awards. The Company’s estimated volatility was based on an average of the historical volatility of peer entities whose stock prices were publicly available. The Company’s calculation of estimated volatility is based on historical stock prices of these peer entities over a period equal to the expected life of the awards. The Company uses the historical volatility of peer entities due to the lack of sufficient historical data of its stock price. The Company records forfeitures as they are incurred. The risk-free interest rate assumption is based upon observed interest rates on zero coupon U.S. Treasury bonds whose maturity period is appropriate for the term of the options. The dividend yield of zero The Company used the Monte Carlo Simulation Model to value at the grant date the aggregate of 1,290,166 market condition performance options granted in October 2023 to the Company’s Chief Executive Officer. The assumptions used in the Monte Carlo Simulation were stock price on date of grant of $1.40, contract term of 10 years, expected volatility of 76% and risk-free interest rate of 4.65 %. Vesting is based on sustained market capitalization of $100 million, $150 million and $200 million and expected to be exercised at the midpoint of the vesting period resulted in implied service periods ranging from approximately 1 to 3 years. Stock option expense was $967 and $1,770 for the years ended December 31, 2023 and 2022, respectively. The following table summarizes information about stock options outstanding at December 31, 2023: Weighted Average Weighted Weighted Remaining Average Average Range of Number Contractual Exercise Number Exercise Exercise Prices Outstanding Life (Years) Price Exercisable Price 1.00 – 2.00 2,084,503 9.59 $ 1.44 75,527 $ 1.79 2.01 – 3.00 1,675,699 8.00 $ 2.76 487,967 $ 2.69 3.01 – 4.00 250,000 10.00 $ 3.10 - $ - 4.01 – 25.00 647,433 5.57 $ 5.39 597,086 $ 5.39 Restricted Stock Units The Plan provides for the grant of restricted stock units (“ RSUs Weighted Average Weighted Average Service-Based Grant Date Vesting RSU's Fair Value Period (Years) Unvested at January 1, 2022 269,303 $ 6.47 2.0 Granted - service based 988,850 $ 2.49 Vested (268,548 ) $ 4.13 Forfeited and cancelled (67,273 ) $ 6.45 Unvested at December 31, 2022 922,332 $ 2.88 2.11 Granted - service based 1,289,784 $ 1.41 Vested (1,056,360 ) $ 1.83 Forfeited and cancelled (345,168 ) $ 2.70 Unvested at December 31, 2023 810,588 $ 1.73 2.52 482,143 of the 1,289,784 RSUs granted included in the table above were granted in October 2023 are performance based RSUs, subject to vesting terms based on future market capitalization. RSU expense was $1,018 and $1,455 for the years ended December 31, 2023 and 2022, respectively. Share-Based Compensation Expense The Company recorded share-based compensation in its statements of operations for the relevant periods for options and RSUs as follows: For the Year Ended December 31, 2023 2022 Selling, general and administrative $ 1,696 $ 2,684 Research and development 289 541 Total share-based expense $ 1,985 $ 3,225 As of December 31, 2023, total estimated compensation cost of stock options granted and outstanding but not yet vested was $3,103 which is expected to be recognized over the weighted average period of 2.65 years. As of December 31, 2023, total estimated compensation cost of RSUs granted and outstanding but not yet vested was $1,144 which is expected to be recognized over the weighted average period of 1.81 years. |
Note 14 - Defined Contribution
Note 14 - Defined Contribution Plan | 12 Months Ended |
Dec. 31, 2023 | |
Notes to Financial Statements | |
Defined Contribution Plan [Text Block] | 14. DEFINED CONTRIBUTION PLAN The Company has a defined contribution savings plan for all eligible U.S. employees established under the provisions of Section 401(k) of the Internal Revenue Code. This plan was formed on January 1, 2022. Eligible employees may contribute a percentage of their salary subject to certain limitations. The Company’s contributions for the years ended December 31, 2023 and 2022, was $0 and $0, respectively. |
Note 15 - Commitments and Conti
Note 15 - Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2023 | |
Notes to Financial Statements | |
Commitments and Contingencies Disclosure [Text Block] | 15. COMMITMENTS AND CONTINGENCIES Facility Lease In November 2023, the Company commenced a lease in an office building located at 3480 Main Highway, Coconut Grove, Florida. The lease of 4,487 square feet for an initial term of 94 months, including 5 months of rent abatement in the first two years of the lease. The aggregate monthly payments will restart in 2024 for $40 per month, increasing 3% each year through the lease term, plus other certain costs and charges as specified in the lease agreement. Our executive offices, sales, training, assembly, and warehouse facilities are located at 1817 West 4th Street, Tempe, Arizona. The lease of 11,256 square feet commenced in June 2019 and was for an initial lease term through July 2022. In January 2022 we renewed this lease for three Related Party Technology License Agreement The Company is obligated to pay royalties and development and patent costs pursuant to an exclusive Amended and Restated Intellectual Property License Agreement dated as of September 30, 2016, with Syzygy, a company owned and controlled by stockholder/consultant Mr. Elwood Norris and stockholder/consultant Mr. James Barnes. The agreement provides for royalty payments of 4% of revenue from products employing the licensed ensnarement device technology up to an aggregate of $1,000 in royalties or until September 30, 2026 , Purchase Commitments At December 31, 2023 the Company was committed for approximately $662 for future component deliveries that are generally subject to modification or rescheduling in the normal course of business Indemnifications and Guarantees Our officers and directors are indemnified as to personal liability as provided by the Delaware law and the Company’s articles and bylaws. The Company may also undertake indemnification obligations in the ordinary course of business related to its operations. The Company is unable to estimate with any reasonable accuracy the liability that may be incurred pursuant to any such indemnification obligations now or in the future. Because of the uncertainty surrounding these circumstances, the Company’s current or future indemnification obligations could range from immaterial to having a material adverse impact on its financial position and its ability to continue in the ordinary course of business. The Company has no liabilities recorded for such indemnities. Regulatory Agencies The Company is subject to oversight from regulatory agencies regarding firearms that arises in the ordinary course of its business. Litigation The Company is subject to litigation and other claims in the ordinary course of business. The Company records a provision for a liability relating to legal matters when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. These provisions are reviewed and adjusted to include the impacts of negotiations, estimated settlements, legal rulings, advice of legal counsel, and other information and events pertaining to a particular matter. At December 31, 2023, we had no provision for liability under existing litigation. |
Note 16 - Related Party Transac
Note 16 - Related Party Transactions | 12 Months Ended |
Dec. 31, 2023 | |
Notes to Financial Statements | |
Related Party Transactions Disclosure [Text Block] | 16. RELATED PARTY TRANSACTIONS Series A Preferred Stock On June 29, 2023, the Company entered into the Series A Purchase Agreement with certain investors, including Scot Cohen, the Company’s Chief Executive Officer, and V4 Global LLC (“V4”). Mr. Cohen has voting and dispositive control with respect to the securities as is deemed to be the beneficial owner of the securities held by V4. Pursuant to the Series A Purchase Agreement, the Company issued Mr. Cohen and V4 an aggregate of 3,000 shares of Series A Preferred Stock and Series A Warrants to purchase up to an aggregate of 2,068,966 shares of Common Stock for aggregate gross proceeds of $3,000. Consulting Services Commencing in October 2017, the Company began reimbursing Mr. Elwood Norris, a former officer, current 5% stockholder and consultant of the Company, $1.5 per month on a month-to-month basis for laboratory facility costs and $7.5 per month on a month-to month basis for invention consulting services, for an aggregate of $108 during each of the years ended December 31, 2023, and 2022. The Company is obligated to pay royalties and development and patent costs pursuant to an exclusive Amended and Restated Intellectual Property License Agreement dated September 30, 2016, with Syzygy Licensing, LLC (“Syzygy”), a company owned and controlled by a 5% stockholder of the Company, Mr. Elwood Norris, and a former officer of the Company, Mr. James Barnes. The agreement provides for royalty payments of 4% of revenue from products employing the licensed ensnarement device technology up to an aggregate of $1,000 in royalties or until September 30, 2026, whichever occurs earlier. During the years ended December 31, 2023, and 2022 the Company incurred royalties to Syzygy of $199 and $274, respectively. Intrensic Acquisition On August 9, 2023, the Company entered into the Intrensic Purchase Agreement with the Sellers, including Kevin Mullins, the Company’s former Chief Executive Officer. Under the terms of the Intrensic Purchase Agreement, the Company agreed to purchase, and Sellers agreed to sell, 100% of the Membership Interests of Intrensic for the following consideration upon the Intrensic Closing: (i) $554 in cash, subject to adjustment based upon the outstanding indebtedness of Intrensic and Intrensic’s working capital as of the Intrensic Closing; and (ii) 1,250,000 shares of Common Stock of the Company. The Intrensic Acquisition closed on August 16, 2023, in accordance with the terms of the Intrensic Purchase Agreement. See Notes 8 and 15 for additional information on related party transactions and obligations. |
Note 17 - Income Taxes
Note 17 - Income Taxes | 12 Months Ended |
Dec. 31, 2023 | |
Notes to Financial Statements | |
Income Tax Disclosure [Text Block] | 17. INCOME TAXES Until its reverse recapitalization on March 31, 2017, the Company was treated as a partnership for federal and state income tax purposes and did not incur income taxes. The Company accounts for income taxes under ASC 740. Deferred income tax assets and liabilities are determined based upon differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. Accounting standards require the consideration of a valuation allowance for deferred tax assets if it is "more likely than not" that some component or all of the benefits of deferred tax assets will not be realized. The provision/(benefit) for Income Taxes for the years ended December 31, 2023 and 2022, consists of the following: Year Ended December 31, 2023 2022 Current Tax Expense/(Benefit) Deferred Tax Expense/(Benefit) $ (4,333 ) $ 3,756 Change in Valuation Allowance 4,333 (3,756 ) Income Tax Provision/(Benefit) $ - $ - The Company’s effective income tax rate is different from the federal statutory tax rate in 2023 predominantly due to the valuation allowance, permanent differences, and state taxes. A reconciliation of the statutory U.S. Federal Tax Rate to the Company's Effective Tax Rate is as follows: Year Ended December 31, 2023 2022 U.S. Statutory Federal Income Tax Rate $ (6,355 ) $ 3,700 State Income Taxes, net of Federal Income tax Benefit (421 ) 345 Permanent differences and other 2,433 (289 ) Valuation Allowance 4,333 (3,756 ) Income Tax Provision/(Benefit) $ - $ - Deferred income taxes represent the tax effect of transactions that are reported in different periods for financial and tax reporting purposes. The combined temporary differences and carryforwards of each tax paying component of the Company that give rise to a significant portion of the deferred income tax benefits and liabilities are as follows as of December 31, 2023 and 2022: Year Ended December 31, 2023 2022 Deferred income tax assets: Net operating loss carryforwards $ 17,002 $ 14,898 Sec. 174 capitalization 1,494 - Research and development credits 81 65 Stock Based Compensation 1,447 1,216 Accruals and Other 995 324 Total deferred tax assets (gross) 21,018 16,503 Less valuation allowance (20,302 ) (15,969 ) Net deferred tax assets 716 534 Deferred income tax liabilities: - - Depreciation and other (716 ) (534 ) Net deferred tax liabilities $ (716 ) $ (534 ) Net deferred income taxes $ - $ - As of December 31, 2023, the Company had available federal net operating loss carryforwards of approximately $703 which begin to expire in 2037, and approximately $78.8 million which will never expire. The Company has available state net operating loss carryforwards of approximately $30.8 million as of December 31, 2023, which begin to expire in 2037. As of December 31, 2023, the Company has federal research and development tax credits of approximately $81. The Company has provided a valuation allowance against the Company’s deferred tax assets, since, in the opinion of management, based upon the earnings history of the Company, it is not more likely than not that the benefits will be realized. All or a portion of the remaining valuation allowance may be reduced in future years based on an assessment of earnings sufficient to fully utilize these potential tax benefits. ASC 740 addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. Under ASC 740, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely that not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The Company has no material uncertain tax positions that qualify for either recognition or disclosure in consolidated financial statements. It is the Company's policy to recognize interest and/or penalties related to income tax matters in income tax expense. As of December 31, 2023 and 2022, the Company has accrued no interest and no penalties related to uncertain tax positions. The Company does not have any federal, or state and local income tax returns currently under examination. |
Note 18 - Major Customers and R
Note 18 - Major Customers and Related Information | 12 Months Ended |
Dec. 31, 2023 | |
Notes to Financial Statements | |
Concentration Risk Disclosure [Text Block] | 18. MAJOR CUSTOMERS AND RELATED INFORMATION Major Customers For the year ended December 31, 2023, revenues from one one For the year ended December 31, 2022, revenues from two one The following table summarizes revenue by geographic region. Revenue is attributed to countries based on customer’s delivery location. For the Year Ended December 31, 2023 2022 Americas $ 3,773 $ 5,315 Europe, Middle East and Africa 2,302 2,487 Asia Pacific 58 247 Total revenues $ 6,133 $ 8,049 See Note 1 – Concentrations of Risks |
Note 19 - Business Combination
Note 19 - Business Combination | 12 Months Ended |
Dec. 31, 2023 | |
Notes to Financial Statements | |
Business Combination Disclosure [Text Block] | 19. BUSINESS COMBINATION On August 8, 2023, the Company entered into the Intrensic Purchase Agreement with the Sellers. The Intrensic Closing occurred on August 16, 2023. Under the terms of the Intrensic Purchase Agreement, the Company agreed to purchase, and Sellers agreed to sell, the Membership Interests for the following consideration at the Intrensic Closing: (i) $554 in cash, subject to adjustment based upon the outstanding indebtedness of Intrensic and Intrensic’s working capital as of the Intrensic Closing; and (ii) 1,250,000 shares of Common Stock of the Company valued at approximately $1,938. The Company assessed the historical financial information of Intrensic to determine if it would materially impact the Company’s historical financial statements for the purposes of disclosing proforma financial information. The Company determined that in the current or prior reporting periods the acquired business contributed immaterially to the Company’s financial statements. Therefore, a pro forma disclosure of the Company as if the business combination had occurred is not warranted under ASC 805. The table below sets forth the allocation of the fair value of Intrensic’s net assets acquired and the corresponding line item in the Company’s consolidated balance sheet at the date of acquisition. Intangible assets were valued using established valuation techniques, as follows: Technology and trade names and trademarks were valued using the relief-from-royalty method, whereby the benefit of ownership of the intellectual property is valued as the relief from the royalty expense that would otherwise be incurred. Customer relationships were valued using the multi-period excess earnings method under the income approach. Cash and cash equivalents $ 3 Accounts receivable 91 Inventory 61 Technology (included in Intangibles) 490 Customer relationships (included in Intangibles) 160 Trademarks and trade names (included in Intangibles) 80 Goodwill 1,610 Total assets $ 2,495 Liabilities 3 Equity 2,492 Total liabilities and equity $ 2,495 Purchase Price: Cash 554 Equity 1,938 Liabilities assumed 3 Total $ 2,495 Legal fees incurred in connection with the transaction totaled approximately $38 and have been expensed as incurred. |
Note 20 - Subsequent Events
Note 20 - Subsequent Events | 12 Months Ended |
Dec. 31, 2023 | |
Notes to Financial Statements | |
Subsequent Events [Text Block] | 20. SUBSEQUENT EVENTS On January 5, 2024, Chris DeAlmeida’s employment as Chief Financial Officer of the Company was terminated without cause, effective immediately, pursuant to a Separation Agreement and Mutual Release of Claims. The termination of Mr. DeAlmeida’s employment was not the result of any disagreement regarding any matter relating to the Company’s operations, policies, or practices. On January 14, 2024, the Board of Directors appointed Scot Cohen the position of Executive Chairman and Chief Executive Officer. In connection therewith, the Company and Mr. Cohen entered into an amendment, dated January 14, 2024, to Mr. Cohen’s Employment Agreement, dated October 12, 2023, to among other things, reflect Mr. Cohen’s new title. In connection with Mr. Cohen’s appointment as Chief Executive Officer, on January 14, 2024, the Board of Directors approved an amendment to the Non-Statutory Stock Option Agreement, dated as of October 12, 2023, between the Company and Mr. Cohen, providing that the stock options issued thereunder shall vest in four annual installments, provided that Mr. Cohen is still employed by the Company or an affiliate of the Company on the applicable vesting date. The other terms of the stock options remain unchanged. In addition, on January 18, 2024, the Board granted Mr. Cohen an award of 632,911 restricted shares of Common Stock of the Company under the Company’s 2017 Equity Compensation Plan, vesting upon the achievement of certain performance goals. On January 14, 2024, the Board of Directors appointed Kevin Mullins to the position of President. In connection therewith, the Company and Mr. Mullins entered into an amendment, dated January 14, 2024, to Mr. Mullins’s Employment Agreement, dated April 13, 2022 to, among other things, reflect Mr. Mullin’s new title. On April 5, 2024, the Board of Directors appointed Mr. Cohen to the position of Interim Principal Financial Officer and Principal Accounting Officer. On April 24, 2024, the Company received notice from Rosenberg Rich Baker Berman, P.A. (“RRBB P.A.”) that it had resigned as the Company’s independent registered public accounting firm, effective immediately. The reports of RRBB P.A. on the Company’s financial statements for the fiscal years ended December 31, 2022 and December 31, 2021, did not contain an adverse opinion or a disclaimer of opinion, and were not qualified or modified as to uncertainty, audit scope, or accounting principles. During the fiscal years ended December 31, 2022, and December 31, 2021, and the subsequent interim period through April 24, 2024, there were no disagreements (as defined in Item 304(a)(1)(iv) of Regulation S-K and the related instructions to Item 304 of Regulation S K) with RRBB P.A. on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of RRBB P.A., would have caused RRBB P.A. to make reference to the subject matter of the disagreements in connection with its reports on the Company’s financial statements for such years. Also during this time, there were no “reportable events,” as defined in Item 304(a)(1)(v) of Regulation S K. On May 7, 2024, Kevin Mullins notified the Company of his intention to resign from his position as President of the Company, effective May 23, 2024. Mr. Mullins’ resignation was not the result of any disagreement regarding any matter relating to the Company’s operations, policies, or practices. On May 7, 2024, the Audit Committee of the Board of Directors engaged HTL International, LLC (“HTL”) as the Company’s independent registered public accounting firm for the fiscal year ended December 31, 2023, effective May 7, 2024. During the fiscal years ended December 31, 2023, 2022 and 2021, and the subsequent interim period from January 1, 2024 through May 7, 2024, neither the Company nor anyone on its behalf has consulted with HTL regarding (i) the application of accounting principles to any specified transaction, either completed or proposed, or the type of audit opinion that might be rendered on the Company's consolidated financial statements, and neither a written report nor oral advice was provided to the Company that HTL concluded was an important factor considered by the Company in reaching a decision as to any accounting, auditing or financial reporting issue, or (ii) any matter that was either the subject of a “disagreement” as defined in Item 304(a)(1)(iv) of Regulation S-K, or a “reportable event” as defined in Item 304(a)(1)(v) of Regulation S-K. On May 28, 2024, Kevin Mullins, tendered his resignation from his role as director of the Company, effective as of May 28, 2024. Mr. Mullins’s resignation from the Board of Directors was not in connection with any disagreement between Mr. Mullins and the Company, its management, the Board of Directors or any committee of the Board of Directors on any matter relating to the Company’s operations, policies or practices, or any other matter. Nasdaq Deficiency Notice On April 18, 2024, the Company received a notice (the “Initial Notice”) from the Listing Qualifications Staff of the Nasdaq Stock Market LLC (“Nasdaq”) notifying the Company that as it has not yet filed its Annual Report on Form 10-K (the “2023 Form 10 K”) for the year ended December 31, 2023, the Company is not in compliance with Listing Rule 5250(c)(1) (the “Listing Rule”) for continued listing on Nasdaq. Additionally, on May 17, 2024, the Company received a notice (the “May Notice") from Nasdaq notifying the Company that as it has not yet filed its Quarterly Report on Form 10-Q (the “Q1 Form 10 Q”) for the three months ended March 31, 2024, that the Company is not in compliance with the Listing Rule. On August 16, 2024, the Company received a notice (the “August Notice," and collectively with the Initial Notice and the May Notice, the “Notices”) from Nasdaq notifying the Company that as it has not yet filed its Quarterly Report on Form 10-Q (the “Q2 Form 10 Q,” and collectively with the 2023 Form 10-K and Q1 Form 10-Q, the “Delinquent Filings”) for the six months ended June 30, 2024, that the Company is not in compliance with the Listing Rule for continued listing on Nasdaq The Company previously submitted a plan to Nasdaq to regain compliance with respect to the delinquent 2023 Form 10-K and Q1 Form 10-Q (the “Plan”), and Nasdaq granted an exception until August 30, 2024, to file the delinquent 2023 Form 10-K and Q1 Form 10-Q. Pursuant to the August Notice, the Company is required to submit an update to the Plan to Nasdaq no later than September 3, 2024, to regain compliance with respect to the filing requirements. Nasdaq may grant the Company an additional exception of up to a maximum of 180 calendar days from the filing due date of the 2023 Form 10-K to file all Delinquent Filings, or until October 14, 2024, to regain compliance. The Notices do not have an immediate effect on the listing of the Company’s common stock. The Company is currently evaluating its options for regaining compliance. There can be no assurance that the Company will regain compliance with the Nasdaq’s rules or maintain compliance with any of the other Nasdaq continued listing requirements. Series A Preferred Stock Amendment On August 19, 2024, the Company entered into an Amendment Agreement (the “Series A Amendment”) with the Required Holders (as defined in the Certificate of Designations). Pursuant to the Series A Amendment, the Required Holders agreed that (A) the unpaid and accrued dividends on the Series A Preferred Stock due July 1, 2024 (the “July Delinquent Dividend Amount”), shall be payable, at the option of the Company, in (i) cash and/or (ii) shares of Common Stock, at a price per share of Common Stock equal to the lower of (x) $1.00 and (y) the Dividend Conversion Price (as defined in the Certificate of Designations), using July 1, 2024, as the applicable date of determination in accordance with the Certificate of Designations; (B) the dividends due on October 1, 2024 (the “October Dividend Amount” and, together with the July Delinquent Dividend Amount, the “Delinquent Dividend Amounts”), shall be payable in shares of Common Stock based on a per share price of Common Stock equal to 80% of the arithmetic average of the three (3) lowest closing sale prices of the Common Stock during the month of September 2024; and (C) such Delinquent Dividend Amounts and any Dividend Balance Shares (as defined in the Certificate of Designations), with respect thereto, if applicable, shall be delivered on October 1, 2024. The Company and the Required Holders further agreed pursuant to the Agreement to amend (i) the Certificate of Designations, as described below, by filing a Certificate of Amendment to the Certificate of Designations (the “Certificate of Amendment”) and (ii) the Series A Purchase Agreement to amend the definition of “Excluded Securities.” The Certificate of Amendment amends the Certificate of Designations to, among other things, (A) allow for the payment of dividends in the form of Common Stock to a holder of the Series A Preferred Stock who serves as a director, officer or employee of the Company; provided that such issuance is approved by the Company’s stockholders prior to such issuance, and (B) amend certain conditions required for (i) a mandatory conversion of the Series A Preferred Stock, and (ii) the Company’s right to redeem, all or a portion, of the Series A Preferred Stock outstanding pursuant to an optional redemption, in each case, pursuant to the terms of the Certificate of Designations. |
Significant Accounting Policies
Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Organization and Business Description [Policy Text Block] | Organization and Business Description Wrap Technologies, Inc., a Delaware corporation (the “ Company we us our Common Stock Nasdaq |
Consolidation, Policy [Policy Text Block] | Principles of Consolidation The Company has two VR |
Use of Estimates, Policy [Policy Text Block] | Basis of Presentation and Use of Estimates The accompanying financial statements have been prepared on the accrual basis of accounting in conformity with accounting principles generally accepted in the United States of America (“ US GAAP |
Concentration Risk, Credit Risk, Policy [Policy Text Block] | Concentrations of Risk Credit Risk Concentrations of Accounts Receivable and Revenue Concentration of Suppliers |
Cash and Cash Equivalents, Policy [Policy Text Block] | Cash and Cash Equivalents The Company considers all highly liquid investments purchased with original maturities of three months or less from the purchase date to be cash equivalents. Cash equivalents consist primarily of amounts invested in Money Market Funds and US (“ US |
Investment, Policy [Policy Text Block] | Short-Term Investments The Company’s short-term investments consist of certificates of deposits and US Treasury bills with original maturities beyond three months at the date of purchase and one year or less from the balance sheet date. As of December 31, 2023, all of the Company’s short-term investments were classified as available-for-sale and are carried at estimated fair value with any unrealized gains and losses, unrelated to credit loss factors, included in other comprehensive income in our consolidated statements of stockholders’ equity. |
Share-Based Payment Arrangement [Policy Text Block] | Share-Based Compensation The Company follows the fair value recognition provisions issued by the FASB in ASC Topic 718, Stock Compensation (“ ASC 718 ASU |
Earnings Per Share, Policy [Policy Text Block] | Loss per Share Basic loss per share (EPS) is computed by dividing net loss, less any dividends, accretion or decretion, redemption or induced conversion, if any, on our Series A Convertible Preferred Stock, by the weighted average number of shares outstanding during the reported period. In computing diluted EPS, we adjust the numerator used in the basic EPS computation, subject to anti-dilution requirements, to add back the dividends (declared or cumulative undeclared) applicable to the Series A Convertible Preferred Stock. Such add-back would also include any adjustments to equity in the period to accrete the Series A Convertible Preferred Stock to its redemption price, or recorded upon a redemption or induced conversion, if any. We adjust the denominator used in the basic EPS computation, subject to anti-dilution requirements, to include the dilution from potential shares resulting from the issuance of the Series A Convertible Preferred Stock, restricted stock units, and stock options. Stock options and restricted stock units exercisable or issuable for a total of 5,468,223 and 6,413,731 shares of Common Stock were outstanding at December 31, 2023 and 2022, respectively. These securities are not included in the computation of diluted net loss per common share for the periods presented as their inclusion would be antidilutive due to losses incurred by the Company. |
Accounts Receivable [Policy Text Block] | Accounts Receivable and Allowance for Credit Losses ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326) At December 31, 2023 and 2022, the Company had an allowance for credit losses related to accounts receivable of $386 and $205, respectively. If a major customer’s creditworthiness deteriorates, or actual defaults exceed our historical experience, such estimates could change and impact our future reported financial results. |
Inventory, Policy [Policy Text Block] | Inventories Inventories are valued at the lower of cost or net realizable value. The cost of substantially all the Company’s inventory is determined by the FIFO cost method. Inventory is comprised of raw materials, assemblies and finished products intended for sale to customers . As of December 31, 2023 and 2022 the Company had $465 and $0 reserves, respectively for obsolescence. |
Property, Plant and Equipment, Policy [Policy Text Block] | Property, Equipment and Depreciation Property and equipment is stated at cost. Depreciation on property and equipment is computed over the estimated useful lives of three |
Business Combinations Policy [Policy Text Block] | Business Combinations The Company accounts for its business combinations under the provisions of Accounting Standards Codification ("ASC") Topic 805-10, Business Combinations ("ASC 805-10"), which requires that the purchase method of accounting be used for all business combinations. Assets acquired and liabilities assumed, including non-controlling interests, are recorded at the date of acquisition at their respective fair values. The estimated fair value of net assets acquired, including the allocation of the fair value to identifiable assets and liabilities, was determined using established valuation techniques. ASC 805-10 also specifies criteria that intangible assets acquired in a business combination must meet to be recognized and reported apart from goodwill. Goodwill represents the excess purchase price over the fair value of the tangible net assets and intangible assets acquired in a business combination. Acquisition-related expenses are recognized separately from the business combinations and are expensed as incurred. The estimated fair value of the acquired intangible assets was determined using a method which reflects the present value of the operating cash flows generated by this asset after taking into account the cost to realize the revenue, and an appropriate discount rate to reflect the time value and risk associated with the invested capital. Certain adjustments to the assessed fair values of the assets and liabilities made subsequent to the acquisition date, but within the measurement period, which is up to one year, are recorded as adjustments to goodwill. Any adjustments subsequent to the measurement period are recorded in income. |
Goodwill and Intangible Assets, Goodwill, Policy [Policy Text Block] | Goodwill Goodwill represents the difference, if any, between the aggregate consideration paid for an acquisition and the fair values of the underlying net assets and liabilities assumed from an acquired business. Goodwill is not amortized, but instead is tested for impairment. The Company tests goodwill for impairment on an annual basis during the fourth quarter, or more frequently if conditions indicate that such impairment could exist. The Company evaluates qualitative factors to determine if it is more likely than not that the fair value of a reporting unit is less than its carrying value and whether it is necessary to perform goodwill impairment process. |
Intangible Assets, Finite-Lived, Policy [Policy Text Block] | Definite-lived Intangible Assets Definite-lived intangible assets represent certain trade names, patents, licenses, software, acquired technology and customer relationships. Definite-lived intangible assets are recorded at cost less any accumulated amortization and accumulated impairment losses, if any. Definite-lived intangible assets acquired through the business combination are measured at fair value at the acquisition date. The Company amortizes these acquired definite-lived intangibles assets with a finite life on a straight-line basis, over 6 years for technology; 7 years for customer relationships; and 8 years for trademarks and trade names. |
Goodwill and Intangible Assets, Intangible Assets, Policy [Policy Text Block] | Intangible Assets Intangible assets consist of (a) capitalized legal fees and filing costs related to obtaining patents and trademarks, (b) tradenames and software, (c) purchased software, and (d) the purchase cost of indefinite-lived website domains. The estimated useful lives of identifiable intangible assets with definite useful lives have been estimated to be between one and twenty years. Purchased website domain costs with an indefinite useful life are not subject to amortization, but are subject to an annual impairment test, by comparing their carrying amount with their corresponding fair value. For any given intangible asset with an indefinite useful life, if its fair value exceeds its carrying amount no impairment loss shall be recognized. The carrying value of intangibles is periodically reviewed and impairments, if any, are recognized when the future undiscounted cash flows realized from the assets is less than its carrying value. |
Impairment or Disposal of Long-Lived Assets, Including Intangible Assets, Policy [Policy Text Block] | Impairment of Long-Lived Assets Long-lived assets and identifiable intangibles held for use are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If the sum of undiscounted expected future cash flows is less than the carrying amount of the asset or if changes in facts and circumstances indicate, an impairment loss is recognized and measured using the asset’s fair value. In December 2023, it was determined that the intangible related to development of proprietary software by Lumeto, Inc. would not have future economic value and was written down; the Company recognized an impairment loss of $700. The Company did not recognize any impairment loss during the year ended December 31, 2022. |
Classification and Valuation of Warrants [Policy Text Block] | Warrants The Company accounts for warrants as liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in Financial Accounting Standards Board (“ FASB ASC ASC ASC For issued warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded at their initial fair value on the date of issuance, and each balance sheet date thereafter. The Company accounts for the warrants issued in accordance with the guidance contained in ASC 815-40-15-7C, under which the warrants do not meet the criteria for equity treatment and must be recorded as liabilities. Accordingly, the Company classifies the warrants as liabilities at their fair value and adjusts the warrants to fair value at each reporting period. This liability is subject to re-measurement at each balance sheet date until exercised, and any change in fair value is recognized in the Company’s condensed consolidated statement of operations. |
Stockholders' Equity, Policy [Policy Text Block] | Convertible Preferred Stocks The Company evaluates and accounts for conversion options embedded in its convertible instruments in accordance with ASC 480 and ASC 815 to determine if those instruments or embedded components of those instruments qualify as derivatives and are subject to bifurcation accounting. The Company determines that the economic characteristics and risks of the embedded derivative instrument are clearly and closely related to the economic characteristics and risks of the host contract. The convertible instruments are accounted for as a single hybrid instrument. Additionally, the convertible instruments do not have any redemption features that would preclude permanent equity classification in accordance with the guidance contained in ASC 480-10-S99. |
Advertising Cost [Policy Text Block] | Advertising and Promotion Costs Advertising costs are charged to expense as incurred and were $925 and $426 for the years ended December 31, 2023 and 2022, respectively. The Company also incurred product promotion costs for demonstration products delivered to prospective customers of $225 and $688 for the years ended December 31, 2023 and 2022, respectively. Advertising and promotion costs are included in selling, general and administrative expenses in the accompanying statements of operations. |
Demonstration and Training Costs [Policy Text Block] | Demonstration and Training Costs The Company maintains a demonstration and training department as a part of its sales and marketing activities and does not charge for product demonstrations or training. Training is not a condition or requirement of sale as most sales are made through distributors to their end customers. The Company conducts local and regional in-person, webinar and on-line demonstrations and use of force and escalation training to support law enforcement agencies with no purchase requirement. Such training, when provided, may occur before or after initial or subsequent purchase or field deployment of the Company’s products. The Company believes that law enforcement trainers and officers that have seen demonstrations or have been trained about its products are more supportive of their departments purchase and deployment of product. |
Research and Development Expense, Policy [Policy Text Block] | Research and Development Costs Research and development costs are expensed as incurred. |
Contract Manufacturers Policy [Policy Text Block] | Contract Manufacturers The Company employs contract manufacturers for production of certain components and sub-assemblies. The Company may provide parts and components to such parties from time to time but recognizes no revenue or markup on such transactions. |
Lessee, Leases [Policy Text Block] | Leases The Company adopted ASC Topic 842, Leases (“ Topic 842 |
Revenue from Contract with Customer [Policy Text Block] | Revenue Recognition The Company adopted ASC Topic 606, Revenue from Contracts with Customers on January 1, 2018. The Company enters into contracts that include various combinations of products, accessories, software and services, each of which are generally distinct and are accounted for as separate performance obligations. Product sales include BolaWrap products and accessories. Other revenue includes VR revenues, service, training and shipping revenues. The timing of revenue recognition may differ from the timing of invoicing to customers. The Company generally has an unconditional right to consideration when customers are invoiced, and a receivable is recorded. A contract asset is recognized when revenue is recognized prior to invoicing, or a contract liability (deferred revenue) when revenue will be recognized subsequent to invoicing. The Company recognizes an asset if there are incremental costs of obtaining a contract with a customer such as commissions. These costs are ascribed to or allocated to the underlying performance obligations in the contract. The Company may receive consideration, per terms of a contract, from customers prior to transferring goods to the customer. The Company records customer deposits as a contract liability. Additionally, the Company may receive payments, most typically for service and warranty contracts, at the onset of the contract and before the services have been performed. In such instances, a deferred revenue liability is recorded. The Company recognizes these contract liabilities as revenue after all revenue recognition criteria are met. Estimated costs for the Company’s standard warranty, generally one-year, are charged to cost of products sold when revenue is recorded for the related product. Royalties are also charged to cost of products sold. |
Shipping and Handling Costs [Policy Text Block] | Shipping and Handling Costs Shipping and handling costs are included in cost of revenues. Shipping and handling costs invoiced to customers are included in revenue. Actual shipping and handling costs were $200 and $296 for the years ended December 31, 2023 and 2022, respectively. Actual revenues from shipping and handling were $37 and $109 for the years ended December 31, 2023 and 2022, respectively. |
Standard Product Warranty, Policy [Policy Text Block] | Warranty Reserves The Company warrants its products and accessories to be free from defects in materials and workmanship for a period of one year from the date of purchase. The warranty is generally limited. The Company currently provides direct warranty service. International market warranties are generally similar to the US market. The Company establishes a warranty reserve based on anticipated warranty claims at the time product revenues are recognized. Factors affecting warranty reserve levels include the number of units sold, anticipated cost of warranty repairs and anticipated rates of warranty claims. The Company evaluates the adequacy of the provision for warranty costs each reporting period. The warranty reserve was $72 and $125 at December 31, 2023 and 2022. Actual warranty costs could differ from estimates. |
Segment Reporting, Policy [Policy Text Block] | Segment Information ASC Topic 280, “Segment Reporting,” requires use of the “management approach” model for segment reporting. The management approach model is based on the way a company’s management organizes segments within the company for making operating decisions and assessing performance. The Company operates as a single segment and will evaluate additional segment disclosure requirements as it expands its operations. |
Income Tax, Policy [Policy Text Block] | Income Taxes No The Company maintains a valuation allowance with respect to deferred tax assets. The Company establishes a valuation allowance based upon the potential likelihood of realizing the deferred tax asset and taking into consideration the Company’s financial position and results of operations for the current period. Future realization of the deferred tax benefit depends on the existence of sufficient taxable income within the carry-forward period under the Federal tax laws. Changes in circumstances, such as the Company generating taxable income, could cause a change in judgment about the realizability of the related deferred tax asset. Any change in the valuation allowance will be included in income in the year of the change in estimates. |
New Accounting Pronouncements, Policy [Policy Text Block] | Recently Issued Accounting Guidance The Company has reviewed recently issued, but not yet effective, accounting pronouncements and does not believe the future adoptions of any such pronouncements will be expected to cause a material impact on its financial condition or the results of operations. In July 2023, the SEC adopted the final rule under SEC Release No. 33-11216, Cybersecurity Risk Management, Strategy, Governance, and Incident Disclosure, requiring disclosure of material cybersecurity incidents on Form 8-K and periodic disclosure of a registrant’s cybersecurity risk management, strategy and governance in annual reports. Regulation S-K Item 6 disclosure requirements under this rule will be effective for us in the fourth quarter of 2023. Incident disclosure requirements in Form 8-K will be effective for us on June 15, 2024. We are still evaluating for any impact on our financial statement disclosures from the adoption of this final rule. |
Note 2 - Revenues and Product_2
Note 2 - Revenues and Product Costs (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Notes Tables | |
Contract with Customer, Contract Asset, Contract Liability, and Receivable [Table Text Block] | Customer Deferred Deposits Revenue Balance at January 1, 2023 $ - $ 333 Additions, net 1,002 407 Transfer to revenue - (196 ) Balance at December 31, 2023 $ 1,002 $ 544 Current portion $ 1,002 $ 407 Long-term portion $ - $ 137 |
Note 4 - Financial Instruments
Note 4 - Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Notes Tables | |
Fair Value Measurements, Recurring and Nonrecurring [Table Text Block] | As of December 31, 2023 Adjusted Unrealized Unrealized Market Cost Gains Losses Value Level 1: Money Market Funds $ 1,793 $ - $ - $ 1,793 Certificate of Deposits 7,500 - - 7,500 Total Financial Assets $ 9,293 $ - $ - $ 9,293 As of December 31, 2022 Adjusted Unrealized Unrealized Market Cost Gains Losses Value Level 1: Money Market Funds $ 3,004 $ - $ - $ 3,004 U.S. Treasury securities in short-term investments 9,849 100 - 9,949 Certificate of Deposits 4,000 - - 4,000 Total Financial Assets $ 16,853 $ 100 $ - $ 16,953 |
Fair Value, Liabilities Measured on Recurring Basis [Table Text Block] | Level 3: December 31, 2023 Fair value at inception or the beginning of the period $ (7,717 ) Change in fair value of warrant liabilities (11,986 ) Fair value as of December 31, 2023 $ (19,703 ) |
Fair Value Measurement Inputs and Valuation Techniques [Table Text Block] | As of December 31, 2023 Expected stock price volatility 143 % Risk-free interest rate 3.85 % Dividends yield 0 % Expected life of warrants (years) 4.50 Exercise price $ 1.45 |
Note 5 - Inventories (Tables)
Note 5 - Inventories (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Notes Tables | |
Schedule of Inventory, Current [Table Text Block] | December 31, 2023 2022 Finished goods $ 3,521 $ 2,293 Raw materials 2,738 1,682 Reserve for Obsolescence (465 ) - Inventories – net $ 5,794 $ 3,975 |
Note 6 - Property and Equipme_2
Note 6 - Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Notes Tables | |
Property, Plant and Equipment [Table Text Block] | December 31, 2023 2022 Production and lab equipment $ 542 $ 513 Tooling 562 448 Computer equipment 615 531 Furniture, fixtures and improvements 196 181 1,915 1,673 Accumulated depreciation (1,406 ) (915 ) Property and equipment, net $ 509 $ 758 |
Note 7 - Intangible Assets, N_2
Note 7 - Intangible Assets, Net and Goodwill (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Notes Tables | |
Schedule of Finite-Lived Intangible Assets [Table Text Block] | December 31, 2023 2022 Amortizable intangible assets: Patents $ 873 $ 575 Trademarks 248 150 Purchased software and technology 1,752 1,962 Customer Relationship 160 - 3,033 2,687 Accumulated amortization (806 ) (462 ) Total amortizable 2,227 2,225 Indefinite life assets (non-amortizable) 421 344 Total intangible assets, net $ 2,648 $ 2,569 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block] | 2024 $ 427 2025 422 2026 335 2027 185 2028 185 Thereafter 673 Total estimated amortization expense $ 2,227 |
Schedule of Goodwill [Table Text Block] | Balance at January 1, 2023 $ - Acquired goodwill 1,610 Balance at December 31, 2023 $ 1,610 |
Note 8 - Accounts Payable and_2
Note 8 - Accounts Payable and Accrued Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Notes Tables | |
Schedule of Accrued Liabilities [Table Text Block] | December 31, 2023 2022 Patent and legal costs $ 21 $ 135 Accrued compensation 325 1,100 Warranty costs 72 125 Taxes and other 274 103 $ 692 $ 1,463 |
Schedule of Product Warranty Liability [Table Text Block] | Year Ended December 31, 2023 2022 Balance, beginning of period $ 125 $ 96 Warranty settlements (169 ) (181 ) Warranty provision 116 210 Balance, end of period $ 72 $ 125 |
Note 9 - Leases (Tables)
Note 9 - Leases (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Notes Tables | |
Lessee, Operating Lease, Disclosure [Table Text Block] | Operating lease liability- short term $ 616 Operating lease liability - long term 1,671 Total Operating Lease Liability $ 2,287 |
Lessee, Operating Lease, Liability, to be Paid, Maturity [Table Text Block] | 2024 $ 443 2025 567 2026 507 2027 522 2028 538 Thereafter 1,271 Total future minimum lease payments 3,848 Less imputed interest (1,561 ) Total $ 2,287 |
Note 13 - Share-based Compens_2
Note 13 - Share-based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Notes Tables | |
Share-Based Payment Arrangement, Option, Activity [Table Text Block] | Weighted Average Options on Remaining Aggregate Common Exercise Contractual Intrinsic Shares Price Term Value Outstanding January 1, 2023 5,491,399 $ 3.72 5.96 $ 92 Granted 2,592,309 $ 1.68 Exercised (123,056 ) $ 1.69 Forfeited, cancelled, expired (3,303,017 ) $ 3.80 Outstanding December 31, 2023 4,657,635 $ 2.52 8.75 $ 3,979 Exercisable December 31, 2023 1,160,580 $ 4.02 7.86 $ 274 |
Schedule of Share-Based Payment Award, Stock Options, Valuation Assumptions [Table Text Block] | For the Year Ended December 31, 2023 2022 Expected stock price volatility 76 % 49 % Risk-free interest rate 4.21 % 2.47 % Forfeiture rate 0 % 0 % Expected dividend yield 0 % 0 % Expected life of options – years 6.00 5.96 Weighted-average fair value of options granted $ 1.33 $ 0.88 |
Share-Based Payment Arrangement, Option, Exercise Price Range [Table Text Block] | Weighted Average Weighted Weighted Remaining Average Average Range of Number Contractual Exercise Number Exercise Exercise Prices Outstanding Life (Years) Price Exercisable Price 1.00 – 2.00 2,084,503 9.59 $ 1.44 75,527 $ 1.79 2.01 – 3.00 1,675,699 8.00 $ 2.76 487,967 $ 2.69 3.01 – 4.00 250,000 10.00 $ 3.10 - $ - 4.01 – 25.00 647,433 5.57 $ 5.39 597,086 $ 5.39 |
Schedule of Nonvested Restricted Stock Units Activity [Table Text Block] | Weighted Average Weighted Average Service-Based Grant Date Vesting RSU's Fair Value Period (Years) Unvested at January 1, 2022 269,303 $ 6.47 2.0 Granted - service based 988,850 $ 2.49 Vested (268,548 ) $ 4.13 Forfeited and cancelled (67,273 ) $ 6.45 Unvested at December 31, 2022 922,332 $ 2.88 2.11 Granted - service based 1,289,784 $ 1.41 Vested (1,056,360 ) $ 1.83 Forfeited and cancelled (345,168 ) $ 2.70 Unvested at December 31, 2023 810,588 $ 1.73 2.52 |
Disclosure of Share-Based Compensation Arrangements by Share-Based Payment Award [Table Text Block] | For the Year Ended December 31, 2023 2022 Selling, general and administrative $ 1,696 $ 2,684 Research and development 289 541 Total share-based expense $ 1,985 $ 3,225 |
Note 17 - Income Taxes (Tables)
Note 17 - Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Notes Tables | |
Schedule of Components of Income Tax Expense (Benefit) [Table Text Block] | Year Ended December 31, 2023 2022 Current Tax Expense/(Benefit) Deferred Tax Expense/(Benefit) $ (4,333 ) $ 3,756 Change in Valuation Allowance 4,333 (3,756 ) Income Tax Provision/(Benefit) $ - $ - |
Schedule of Effective Income Tax Rate Reconciliation [Table Text Block] | Year Ended December 31, 2023 2022 U.S. Statutory Federal Income Tax Rate $ (6,355 ) $ 3,700 State Income Taxes, net of Federal Income tax Benefit (421 ) 345 Permanent differences and other 2,433 (289 ) Valuation Allowance 4,333 (3,756 ) Income Tax Provision/(Benefit) $ - $ - |
Schedule of Deferred Tax Assets and Liabilities [Table Text Block] | Year Ended December 31, 2023 2022 Deferred income tax assets: Net operating loss carryforwards $ 17,002 $ 14,898 Sec. 174 capitalization 1,494 - Research and development credits 81 65 Stock Based Compensation 1,447 1,216 Accruals and Other 995 324 Total deferred tax assets (gross) 21,018 16,503 Less valuation allowance (20,302 ) (15,969 ) Net deferred tax assets 716 534 Deferred income tax liabilities: - - Depreciation and other (716 ) (534 ) Net deferred tax liabilities $ (716 ) $ (534 ) Net deferred income taxes $ - $ - |
Note 18 - Major Customers and_2
Note 18 - Major Customers and Related Information (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Notes Tables | |
Disaggregation of Revenue [Table Text Block] | For the Year Ended December 31, 2023 2022 Americas $ 3,773 $ 5,315 Europe, Middle East and Africa 2,302 2,487 Asia Pacific 58 247 Total revenues $ 6,133 $ 8,049 |
Note 19 - Business Combination
Note 19 - Business Combination (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Notes Tables | |
Schedule of Business Acquisitions, by Acquisition [Table Text Block] | Cash and cash equivalents $ 3 Accounts receivable 91 Inventory 61 Technology (included in Intangibles) 490 Customer relationships (included in Intangibles) 160 Trademarks and trade names (included in Intangibles) 80 Goodwill 1,610 Total assets $ 2,495 Liabilities 3 Equity 2,492 Total liabilities and equity $ 2,495 Purchase Price: Cash 554 Equity 1,938 Liabilities assumed 3 Total $ 2,495 |
Note 1 - Organization and Sum_2
Note 1 - Organization and Summary of Significant Accounting Policies (Details Textual) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | |
Dec. 31, 2023 USD ($) $ / shares | Dec. 31, 2023 USD ($) $ / shares shares | Dec. 31, 2022 USD ($) $ / shares shares | |
Common Stock, Par or Stated Value Per Share | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 |
Number of Wholly-owned Subsidiaries | 2 | 2 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | shares | 5,468,223 | 6,413,731 | |
Accounts Receivable, Allowance for Credit Loss | $ 386 | $ 386 | $ 205 |
Inventory Valuation Reserves | $ 465 | $ 465 | 0 |
Property, Plant and Equipment, Useful Life | 3 years | 3 years | |
Impairment of Intangible Assets (Excluding Goodwill) | $ 700 | $ 700 | 0 |
Advertising Expense | 925 | 426 | |
Marketing Expense | 225 | 688 | |
Cost of Revenue | 3,227 | 4,315 | |
Revenue from Contract with Customer, Including Assessed Tax | 5,337 | 7,481 | |
Standard Product Warranty Accrual | $ 72 | 72 | 125 |
Income Tax Expense (Benefit) | 0 | 0 | |
Shipping and Handling [Member] | |||
Cost of Revenue | 200 | 296 | |
Revenue from Contract with Customer, Including Assessed Tax | $ 37 | $ 109 | |
Technology-Based Intangible Assets [Member] | |||
Finite-Lived Intangible Asset, Useful Life | 6 years | 6 years | |
Customer Relationships [Member] | |||
Finite-Lived Intangible Asset, Useful Life | 7 years | 7 years | |
Trademarks and Trade Names [Member] | |||
Finite-Lived Intangible Asset, Useful Life | 8 years | 8 years |
Note 2 - Revenues and Product_3
Note 2 - Revenues and Product Costs (Details Textual) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Contract with Customer, Asset, after Allowance for Credit Loss, Total | $ 0 | $ 0 |
Extended Warranties and Services, VR, and Training [Member] | ||
Contract with Customer, Liability | 544 | 333 |
Extended Product Warranties [Member] | BolaWrap [Member] | ||
Contract with Customer, Liability | 139 | 124 |
Extended Product Warranties [Member] | Intrensic [Member] | ||
Contract with Customer, Liability | 216 | |
Virtual Reality Training [Member] | ||
Contract with Customer, Liability | 171 | 198 |
Training [Member] | ||
Contract with Customer, Liability | $ 18 | $ 11 |
Note 2 - Revenue and Product Co
Note 2 - Revenue and Product Costs - Contract Liabilities (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Customer Deposits [Member] | ||
Balance | $ 0 | |
Additions, net | 1,002 | |
Transfer to revenue | 0 | |
Balance | 1,002 | |
Current portion | 1,002 | |
Long-term portion | 0 | |
Extended Warranties and Services, VR, and Training [Member] | ||
Balance | 333 | |
Additions, net | 407 | |
Transfer to revenue | (196) | |
Balance | 544 | |
Current portion | 407 | $ 166 |
Long-term portion | $ 137 | $ 167 |
Note 3 - Asset Acquisition (Det
Note 3 - Asset Acquisition (Details Textual) - USD ($) | 1 Months Ended | 12 Months Ended | |||||
Aug. 16, 2023 | Aug. 16, 2023 | Aug. 09, 2023 | Nov. 22, 2022 | Dec. 31, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | |
Impairment of Intangible Assets (Excluding Goodwill) | $ 700,000 | $ 700,000 | $ 0 | ||||
Professional Services and Technology Acquisition Agreement [Member] | |||||||
Payments to Acquire Businesses, Gross | $ 700,000 | ||||||
Intrensic, LLC [Member] | |||||||
Payments to Acquire Businesses, Gross | $ 554,000 | $ 554,000 | $ 553,588 | ||||
Business Acquisition, Percentage of Voting Interests Acquired | 100% | ||||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | 1,250,000 | 1,250,000 | 1,250,000 |
Note 4 - Financial Instrument_2
Note 4 - Financial Instruments (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
OCI, Debt Securities, Available-for-Sale, Unrealized Holding Gain (Loss), before Adjustment, after Tax | $ 0 | $ 100 |
Note 4 - Financial Instrument_3
Note 4 - Financial Instruments - Instruments by Significant Investment Category (Details) - Fair Value, Inputs, Level 1 [Member] - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Adjusted cost | $ 9,293 | $ 16,853 |
Unrealized gains | 0 | 100 |
Unrealized losses | 0 | 0 |
Market value | 9,293 | 16,953 |
Money Market Funds [Member] | ||
Adjusted cost | 1,793 | 3,004 |
Unrealized gains | 0 | 0 |
Unrealized losses | 0 | 0 |
Market value | 1,793 | 3,004 |
US Treasury Securities Considered Cash Equivalents [Member] | ||
Adjusted cost | 9,849 | |
Unrealized gains | 100 | |
Unrealized losses | 0 | |
Market value | 9,949 | |
Certificates of Deposit [Member] | ||
Adjusted cost | 7,500 | 4,000 |
Unrealized gains | 0 | 0 |
Unrealized losses | 0 | 0 |
Market value | $ 7,500 | $ 4,000 |
Note 4 - Financial Instrument_4
Note 4 - Financial Instruments - Level 3 Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Change in fair value of warrant liabilities | $ 11,986 | $ 0 |
Fair Value, Inputs, Level 3 [Member] | ||
Fair value at inception or the beginning of the period | (7,717) | |
Change in fair value of warrant liabilities | (11,986) | |
Fair value as of December 31, 2023 | $ (19,703) | $ (7,717) |
Note 4 - Financial Instrument_5
Note 4 - Financial Instruments - Fair Value Assumptions (Details) | Dec. 31, 2023 |
Measurement Input, Price Volatility [Member] | |
Warrants, measurement input | 1.43 |
Measurement Input, Risk Free Interest Rate [Member] | |
Warrants, measurement input | 0.0385 |
Measurement Input, Expected Dividend Rate [Member] | |
Warrants, measurement input | 0 |
Measurement Input, Expected Term [Member] | |
Warrants, measurement input | 4.5 |
Measurement Input, Exercise Price [Member] | |
Warrants, measurement input | 1.45 |
Note 5 - Inventories, Net - Sum
Note 5 - Inventories, Net - Summary of Inventories (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Finished goods | $ 3,521 | $ 2,293 |
Raw materials | 2,738 | 1,682 |
Reserve for Obsolescence | (465) | 0 |
Inventories - net | $ 5,794 | $ 3,975 |
Note 6 - Property and Equipme_3
Note 6 - Property and Equipment (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Depreciation | $ 479 | $ 475 |
Note 6 - Property and Equipme_4
Note 6 - Property and Equipment, Net - Summary of Property and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Property and equipment, gross | $ 1,915 | $ 1,673 |
Accumulated depreciation | (1,406) | (915) |
Property and equipment, net | 509 | 758 |
Production and Lab Equipment [Member] | ||
Property and equipment, gross | 542 | 513 |
Tooling [Member] | ||
Property and equipment, gross | 562 | 448 |
Computer Equipment [Member] | ||
Property and equipment, gross | 615 | 531 |
Furniture and Fixtures [Member] | ||
Property and equipment, gross | $ 196 | $ 181 |
Note 7 - Intangible Assets, N_3
Note 7 - Intangible Assets, Net and Goodwill (Details Textual) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | Aug. 31, 2023 | |
Amortization of Intangible Assets | $ 345 | $ 287 | ||
Impairment of Intangible Assets (Excluding Goodwill) | $ 700 | $ 700 | $ 0 | |
Intrensic, LLC [Member] | Trademarks [Member] | ||||
Acquired Finite-Lived Intangible Asset, Residual Value | $ 80 | |||
Intrensic, LLC [Member] | Technology-Based Intangible Assets [Member] | ||||
Acquired Finite-Lived Intangible Asset, Residual Value | 490 | |||
Intrensic, LLC [Member] | Customer Relationships [Member] | ||||
Acquired Finite-Lived Intangible Asset, Residual Value | $ 160 |
Note 7 - Intangible Assets, N_4
Note 7 - Intangible Assets, Net and Goodwill - Summary of Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Amortizable intangible assets, gross | $ 3,033 | $ 2,687 |
Accumulated amortization | (806) | (462) |
Total amortizable | 2,227 | 2,225 |
Indefinite life assets (non-amortizable) | 421 | 344 |
Total intangible assets, net | 2,648 | 2,569 |
Patents [Member] | ||
Amortizable intangible assets, gross | 873 | 575 |
Trademarks [Member] | ||
Amortizable intangible assets, gross | 248 | 150 |
Computer Software, Intangible Asset [Member] | ||
Amortizable intangible assets, gross | 1,752 | 1,962 |
Customer Relationships [Member] | ||
Amortizable intangible assets, gross | $ 160 | $ 0 |
Note 7 - Intangible Assets, N_5
Note 7 - Intangible Assets, Net and Goodwill - Future Amortization Expense (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
2024 | $ 427 | |
2025 | 422 | |
2026 | 335 | |
2027 | 185 | |
2028 | 185 | |
Thereafter | 673 | |
Total amortizable | $ 2,227 | $ 2,225 |
Note 7 - Intangible Assets and
Note 7 - Intangible Assets and Goodwill - Schedule of Goodwill (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2023 USD ($) | |
Balance at January 1, 2023 | $ 0 |
Acquired goodwill | 1,610 |
Balance at December 31, 2023 | $ 1,610 |
Note 8 - Accounts Payable and_3
Note 8 - Accounts Payable and Accrued Liabilities (Details Textual) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Commissions Payable [Member] | ||
Employee-related Liabilities | $ 0 | $ 1,022 |
Syzygy Licensing LLC [Member] | ||
Accounts Payable | $ 14 | $ 127 |
Note 8 - Accounts Payable and_4
Note 8 - Accounts Payable and Accrued Liabilities - Summary of Accrued Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Patent and legal costs | $ 21 | $ 135 |
Accrued compensation | 325 | 1,100 |
Warranty costs | 72 | 125 |
Taxes and other | 274 | 103 |
Accrued Liabilities, Current | $ 692 | $ 1,463 |
Note 8 - Accounts Payable and_5
Note 8 - Accounts Payable and Accrued Liabilities - Changes in Product Warranty Costs (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Balance | $ 125 | $ 96 |
Warranty settlements | (169) | (181) |
Warranty provision | 116 | 210 |
Balance | $ 72 | $ 125 |
Note 9 - Leases (Details Textua
Note 9 - Leases (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Operating Lease, Right-of-Use Asset, Periodic Reduction | $ 138,000 | $ 101,000 |
Operating Lease, Cost | $ 177,000 | 118,000 |
Operating Lease, Weighted Average Remaining Lease Term | 6 years 9 months 7 days | |
Operating Lease, Weighted Average Discount Rate, Percent | 14.20% | |
Variable Lease, Cost | $ 8,000 | 39,000 |
Short-Term Lease, Cost | $ 92 | $ 11 |
Note 9 - Leases - Summary of Op
Note 9 - Leases - Summary of Operating Lease Obligations (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Operating lease liability - short term | $ 616 | $ 108 |
Operating lease liability - long term | 1,671 | $ 193 |
Total Operating Lease Liability | $ 2,287 |
Note 9 - Leases - Future Lease
Note 9 - Leases - Future Lease Payments (Details) $ in Thousands | Dec. 31, 2023 USD ($) |
2024 | $ 443 |
2025 | 567 |
2026 | 507 |
2027 | 522 |
2028 | 538 |
Thereafter | 1,271 |
Total future minimum lease payments | 3,848 |
Less imputed interest | (1,561) |
Total | $ 2,287 |
Note 10 - Warrants (Details Tex
Note 10 - Warrants (Details Textual) - USD ($) $ / shares in Units, $ in Thousands | Jun. 29, 2023 | Dec. 31, 2023 | Jul. 03, 2023 | Dec. 31, 2022 |
Preferred Stock, Par or Stated Value Per Share (in dollars per share) | $ 0.0001 | $ 0.0001 | ||
Warrants Issued in Registered Direct Offering [Member] | ||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights (in shares) | 6,896,553 | |||
Class of Warrant or Right, Exercise Price of Warrants or Rights (in dollars per share) | $ 1.45 | |||
Warrants and Rights Outstanding, Term (Year) | 5 years | |||
Registered Direct Offering [Member] | ||||
Proceeds from Issuance or Sale of Equity | $ 10,000 | |||
Proceeds from Issuance of Warrants | $ 7,717 | |||
Series A Preferred Stock [Member] | ||||
Preferred Stock, Convertible, Conversion Price (in dollars per share) | $ 1.45 | |||
Series A Preferred Stock [Member] | Registered Direct Offering [Member] | ||||
Stock Issued During Period, Shares, New Issues (in shares) | 10,000 | |||
Preferred Stock, Par or Stated Value Per Share (in dollars per share) | $ 0.0001 | |||
Preferred Stock, Stated Value Per Share (in dollars per share) | $ 1,000 | |||
Preferred Stock, Convertible, Shares Issuable (in shares) | 6,896,553 | |||
Preferred Stock, Convertible, Conversion Price (in dollars per share) | $ 1.45 |
Note 12 - Stockholders' Equity
Note 12 - Stockholders' Equity (Details Textual) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||||
Apr. 16, 2024 | Jul. 03, 2023 | Jun. 29, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | |
Common Stock, Shares Authorized | 150,000,000 | 150,000,000 | |||
Preferred Stock, Shares Authorized | 5,000,000 | 5,000,000 | |||
Preferred Stock, Par or Stated Value Per Share (in dollars per share) | $ 0.0001 | $ 0.0001 | |||
Dividends | $ 160 | ||||
Dividends, Preferred Stock, Stock | $ 232 | $ 0 | |||
Conversion of Series A Preferred Stock to Common Stock [Member] | |||||
Conversion of Stock, Shares Converted | 102 | ||||
Conversion of Stock, Shares Issued | 77 | ||||
Registered Direct Offering [Member] | |||||
Proceeds from Issuance of Preferred Stock and Preference Stock | $ 2,036 | ||||
Series A Preferred Stock [Member] | |||||
Common Stock, Shares Authorized | 10,000 | 10,000 | |||
Preferred Stock, Convertible, Conversion Price (in dollars per share) | $ 1.45 | ||||
Preferred Stock, Dividend Rate, Percentage | 8% | ||||
Preferred Stock, Convertible, Share Price Threshold | $ 8 | ||||
Preferred Stock, Convertible, Trading Volume Threshold | $ 2,000,000 | ||||
Dividends | $ 392 | ||||
Dividends, Preferred Stock, Cash | 58 | ||||
Dividends, Preferred Stock, Stock | 232 | ||||
Dividends Payable | $ 102 | ||||
Series A Preferred Stock [Member] | Registered Direct Offering [Member] | |||||
Preferred Stock, Par or Stated Value Per Share (in dollars per share) | $ 0.0001 | ||||
Preferred Stock, Convertible, Conversion Price (in dollars per share) | $ 1.45 | ||||
Series A Preferred Stock [Member] | Post Triggering Event [Member] | |||||
Preferred Stock, Dividend Rate, Percentage | 20% | ||||
Series A Preferred Stock [Member] | Forecast [Member] | |||||
Preferred Stock, Dividend Rate, Percentage | 20% |
Note 13 - Share-based Compens_3
Note 13 - Share-based Compensation (Details Textual) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | ||||||||
Oct. 31, 2023 | Apr. 30, 2023 | Jun. 30, 2022 | Apr. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2020 | May 31, 2019 | Dec. 31, 2023 | Dec. 31, 2022 | Mar. 31, 2017 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding, Number | 4,657,635 | 5,491,399 | ||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Grants in Period, Gross | 2,592,309 | |||||||||
Share-Based Payment Arrangement, Expense | $ 1,985 | $ 3,225 | ||||||||
Share-Based Payment Arrangement, Option [Member] | ||||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Fair Value Assumptions, Expected Dividend Rate | 0% | 0% | ||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Fair Value Assumptions, Expected Term | 6 years | 5 years 11 months 15 days | ||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Fair Value Assumptions, Expected Volatility Rate | 76% | 49% | ||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Fair Value Assumptions, Risk Free Interest Rate | 4.21% | 2.47% | ||||||||
Share-Based Payment Arrangement, Nonvested Award, Option, Cost Not yet Recognized, Amount | $ 3,103 | |||||||||
Share-Based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition | 2 years 7 months 24 days | |||||||||
Restricted Stock Units (RSUs) [Member] | ||||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Grants in Period | 482,143 | 1,289,784 | 988,850 | |||||||
Share-Based Payment Arrangement, Nonvested Award, Option, Cost Not yet Recognized, Amount | $ 1,144 | |||||||||
Share-Based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition | 1 year 9 months 21 days | |||||||||
The 2017 Stock Incentive Plan [Member] | ||||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Number of Shares Authorized | 9,000,000 | 2,000,000 | ||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Number of Additional Shares Authorized | 1,500,000 | 1,500,000 | 1,900,000 | 2,100,000 | ||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Number of Shares Available for Grant | 1,391,183 | |||||||||
Share-Based Payment Arrangement, Accelerated Cost | $ 112 | |||||||||
The 2017 Stock Incentive Plan [Member] | Service-based Options [Member] | ||||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding, Number | 2,675,071 | |||||||||
The 2017 Stock Incentive Plan [Member] | Performance-based Options [Member] | ||||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding, Number | 1,982,564 | |||||||||
The 2017 Stock Incentive Plan [Member] | Performance-based Options [Member] | Chief Executive Officer [Member] | ||||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Grants in Period, Gross | 1,290,166 | 692,398 | ||||||||
The 2017 Stock Incentive Plan [Member] | Share-Based Payment Arrangement, Option [Member] | ||||||||||
Share-Based Payment Arrangement, Expense | $ 967 | $ 1,770 | ||||||||
The 2017 Stock Incentive Plan [Member] | Performance Shares [Member] | Chief Executive Officer and President [Member] | ||||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Grants in Period, Gross | 1,290,166 | |||||||||
Share Price | $ 1.4 | |||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Fair Value Assumptions, Expected Term | 10 years | |||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Fair Value Assumptions, Expected Volatility Rate | 76% | |||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Fair Value Assumptions, Risk Free Interest Rate | 4.65% | |||||||||
The 2017 Stock Incentive Plan [Member] | Performance Shares [Member] | Chief Executive Officer and President [Member] | Minimum [Member] | ||||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Award Requisite Service Period | 1 year | |||||||||
The 2017 Stock Incentive Plan [Member] | Performance Shares [Member] | Chief Executive Officer and President [Member] | Maximum [Member] | ||||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Award Requisite Service Period | 3 years | |||||||||
The 2017 Stock Incentive Plan [Member] | Performance Shares [Member] | Chief Executive Officer and President [Member] | Share-Based Payment Arrangement, Tranche One [Member] | ||||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Vesting, Sustained Market Capitalization | $ 100,000 | |||||||||
The 2017 Stock Incentive Plan [Member] | Performance Shares [Member] | Chief Executive Officer and President [Member] | Share-Based Payment Arrangement, Tranche Two [Member] | ||||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Vesting, Sustained Market Capitalization | 150,000 | |||||||||
The 2017 Stock Incentive Plan [Member] | Performance Shares [Member] | Chief Executive Officer and President [Member] | Share-Based Payment Arrangement, Tranche Three [Member] | ||||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Vesting, Sustained Market Capitalization | $ 200,000 | |||||||||
The 2017 Stock Incentive Plan [Member] | Restricted Stock Units (RSUs) [Member] | ||||||||||
Share-Based Payment Arrangement, Expense | $ 1,018 | $ 1,455 |
Note 12 - Share-based Compensat
Note 12 - Share-based Compensation - Summary of Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Options on Common Shares, Outstanding (in shares) | 5,491,399 | |
Outstanding, weighted average exercise price (in dollars per share) | $ 3.72 | |
Outstanding, remaining contractual term (Year) | 8 years 9 months | 5 years 11 months 15 days |
Outstanding, aggregate intrinsic value | $ 3,979 | $ 92 |
Options on Common Shares, Granted (in shares) | 2,592,309 | |
Granted, weighted average exercise price (in dollars per share) | $ 1.68 | |
Options on Common Shares, Exercised (in shares) | (123,056) | |
Exercised, weighted average exercise price (in dollars per share) | $ 1.69 | |
Options on Common Shares, Forfeited, cancelled, expired (in shares) | (3,303,017) | |
Forfeited, cancelled, expired, weighted average exercise price (in dollars per share) | $ 3.8 | |
Options on Common Shares, Outstanding (in shares) | 4,657,635 | 5,491,399 |
Outstanding, weighted average exercise price (in dollars per share) | $ 2.52 | $ 3.72 |
Exercisable, shares (in shares) | 1,160,580 | |
Exercisable, weighted average exercise price (in dollars per share) | $ 4.02 | |
Exercisable, weighted average contractual term (Year) | 7 years 10 months 9 days | |
Exercisable, aggregate intrinsic value | $ 274 |
Note 12 - Share-based Compens_2
Note 12 - Share-based Compensation - Summary of Stock Option Valuation Assumptions (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Forfeiture rate | 0% | 0% |
Weighted-average fair value of options granted (in dollars per share) | $ 1.33 | $ 0.88 |
Share-Based Payment Arrangement, Option [Member] | ||
Expected stock price volatility | 76% | 49% |
Risk-free interest rate | 4.21% | 2.47% |
Expected dividend yield | 0% | 0% |
Expected life of options – years (Year) | 6 years | 5 years 11 months 15 days |
Note 12 - Share-based Compens_3
Note 12 - Share-based Compensation - Information Regarding Stock Options Outstanding (Details) | 12 Months Ended |
Dec. 31, 2023 $ / shares shares | |
Exercise Price Range One [Member] | |
Exercise price, lower range limit (in dollars per share) | $ 1 |
Exercise price, upper range limit (in dollars per share) | $ 2 |
Options, number outstanding (in shares) | shares | 2,084,503 |
Options outstanding, weighted average remaining contractual life (Year) | 9 years 7 months 2 days |
Options outstanding, weighted average exercise price (in dollars per share) | $ 1.44 |
Options exercisable (in shares) | shares | 75,527 |
Options exercisable, weighted average exercise price (in dollars per share) | $ 1.79 |
Exercise Price Range Two [Member] | |
Exercise price, lower range limit (in dollars per share) | 2.01 |
Exercise price, upper range limit (in dollars per share) | $ 3 |
Options, number outstanding (in shares) | shares | 1,675,699 |
Options outstanding, weighted average remaining contractual life (Year) | 8 years |
Options outstanding, weighted average exercise price (in dollars per share) | $ 2.76 |
Options exercisable (in shares) | shares | 487,967 |
Options exercisable, weighted average exercise price (in dollars per share) | $ 2.69 |
Exercise Price Range Three [Member] | |
Exercise price, lower range limit (in dollars per share) | 3.01 |
Exercise price, upper range limit (in dollars per share) | $ 4 |
Options, number outstanding (in shares) | shares | 250,000 |
Options outstanding, weighted average remaining contractual life (Year) | 10 years |
Options outstanding, weighted average exercise price (in dollars per share) | $ 3.1 |
Options exercisable (in shares) | shares | 0 |
Options exercisable, weighted average exercise price (in dollars per share) | $ 0 |
Exercise Price Range Four [Member] | |
Exercise price, lower range limit (in dollars per share) | 4.01 |
Exercise price, upper range limit (in dollars per share) | $ 25 |
Options, number outstanding (in shares) | shares | 647,433 |
Options outstanding, weighted average remaining contractual life (Year) | 5 years 6 months 25 days |
Options outstanding, weighted average exercise price (in dollars per share) | $ 5.39 |
Options exercisable (in shares) | shares | 597,086 |
Options exercisable, weighted average exercise price (in dollars per share) | $ 5.39 |
Note 12 - Share-based Compens_4
Note 12 - Share-based Compensation - Summary of RSU Activity (Details) - Restricted Stock Units (RSUs) [Member] - $ / shares | 1 Months Ended | 12 Months Ended | ||
Oct. 31, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Awards other than options, unvested (in shares) | 922,332 | 269,303 | ||
Awards other than options, unvested, weighted average grant date fair value (in dollars per share) | $ 2.88 | $ 6.47 | ||
Unvested, vesting period (Year) | 2 years 6 months 7 days | 2 years 1 month 9 days | 2 years | |
Awards other than options, Granted (in shares) | 482,143 | 1,289,784 | 988,850 | |
Awards other than options, granted, weighted average grant date fair value (in dollars per share) | $ 1.41 | $ 2.49 | ||
Awards other than options, Vested (in shares) | (1,056,360) | (268,548) | ||
Awards other than options, vested, weighted average grant date fair value (in dollars per share) | $ 1.83 | $ 4.13 | ||
Awards other than options, Forfeited and cancelled (in shares) | (345,168) | (67,273) | ||
Awards other than options, forfeited and cancelled, weighted average grant date fair value (in dollars per share) | $ 2.7 | $ 6.45 | ||
Awards other than options, unvested (in shares) | 810,588 | 922,332 | 269,303 | |
Awards other than options, unvested, weighted average grant date fair value (in dollars per share) | $ 1.73 | $ 2.88 | $ 6.47 |
Note 12 - Share-based Compens_5
Note 12 - Share-based Compensation - Allocation of Share-based Compensation Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Share-based expense | $ 1,985 | $ 3,225 |
Selling, General and Administrative Expenses [Member] | ||
Share-based expense | 1,696 | 2,684 |
Research and Development Expense [Member] | ||
Share-based expense | $ 289 | $ 541 |
Note 14 - Defined Contributio_2
Note 14 - Defined Contribution Plan (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Defined Benefit Plan, Plan Assets, Contributions by Employer | $ 0 | $ 0 |
Note 15 - Commitments and Con_2
Note 15 - Commitments and Contingencies (Details Textual) | 12 Months Ended | ||||||
Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | Nov. 30, 2023 USD ($) ft² | Aug. 31, 2022 USD ($) | Jan. 31, 2022 | Jun. 30, 2019 ft² | Sep. 30, 2016 USD ($) | |
Contractual Obligation | $ 662,000 | ||||||
Related Party Technology License Agreement [Member] | Syzygy Licensing LLC [Member] | |||||||
Royalty Payments, Percentage of Product Revenue | 4% | ||||||
Maximum Royalties to Be Paid Under Agreement | $ 1,000,000 | ||||||
Royalty Expense | 199,000 | $ 274,000 | |||||
Royalty Guarantees, Commitments, Amount | $ 81,000 | ||||||
Office Space in Miami, Florida [Member] | |||||||
Area of Real Estate Property | ft² | 4,487 | ||||||
Lessee, Operating Lease, Term of Contract | 94 months | ||||||
Lessee, Operating Lease, Rent Abatement Term | 5 months | ||||||
Lessee, Operating Lease, Monthly Liability, to be Paid | $ 40 | ||||||
Lessee, Operating Lease, Yearly Rent Increase | 3% | ||||||
Office Space in Tempe, Arizona [Member] | |||||||
Area of Real Estate Property | ft² | 11,256 | ||||||
Lessee, Operating Lease, Term of Contract | 3 years | ||||||
Lessee, Operating Lease, Monthly Liability, to be Paid | $ 10 | ||||||
Lessee, Operating Lease, Yearly Rent Increase | 4% |
Note 16 - Related Party Trans_2
Note 16 - Related Party Transactions (Details Textual) - USD ($) | 12 Months Ended | ||||||
Aug. 16, 2023 | Aug. 16, 2023 | Aug. 09, 2023 | Jun. 29, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | Sep. 30, 2016 | |
Intrensic, LLC [Member] | |||||||
Business Acquisition, Percentage of Voting Interests Acquired | 100% | ||||||
Payments to Acquire Businesses, Gross | $ 554,000 | $ 554,000 | $ 553,588 | ||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | 1,250,000 | 1,250,000 | 1,250,000 | ||||
Executive Chairman [Member] | |||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights (in shares) | 2,068,966 | ||||||
Proceeds from Issuance or Sale of Equity | $ 3,000,000 | ||||||
Executive Chairman [Member] | Series A Preferred Stock [Member] | |||||||
Stock Issued During Period, Shares, New Issues (in shares) | 3,000 | ||||||
Mr. Elwood Norris [Member] | |||||||
Reimbursement of Expenses to Related Party, Monthly Amount | $ 1,500 | ||||||
Consulting Fees to Related Party, Monthly Amount | 7,500 | ||||||
Related Party Transaction, Amounts of Transaction | 108,000 | $ 108,000 | |||||
Syzygy Licensing LLC [Member] | Related Party Technology License Agreement [Member] | |||||||
Royalty Payments, Percentage of Product Revenue | 4% | ||||||
Maximum Royalties to Be Paid Under Agreement | $ 1,000,000 | ||||||
Royalty Expense | $ 199,000 | $ 274,000 |
Note 17 - Income Taxes (Details
Note 17 - Income Taxes (Details Textual) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Deferred Tax Assets, Tax Credit Carryforwards, Research | $ 81 | $ 65 |
Domestic Tax Jurisdiction [Member] | ||
Operating Loss Carryforward Subject to Expiration | 703 | |
Operating Loss Carryforwards | 78,800 | |
State and Local Jurisdiction [Member] | ||
Operating Loss Carryforwards | $ 30,800 |
Note 17 - Income Taxes - Income
Note 17 - Income Taxes - Income Tax Expense (Benefits) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Deferred Tax Expense/(Benefit) | $ (4,333) | $ 3,756 |
Change in Valuation Allowance | 4,333 | (3,756) |
Income Tax Provision/(Benefit) | $ 0 | $ 0 |
Note 17 - Income Taxes - Reconc
Note 17 - Income Taxes - Reconciliations of Federal Statutory Rate to Effective Income Tax Rate (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
U.S. Statutory Federal Income Tax Rate | $ (6,355) | $ 3,700 |
State Income Taxes, net of Federal Income tax Benefit | (421) | 345 |
Permanent differences and other | 2,433 | (289) |
Valuation Allowance | 4,333 | (3,756) |
Income Tax Provision/(Benefit) | $ 0 | $ 0 |
Note 17 - Income Taxes - Deferr
Note 17 - Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Net operating loss carryforwards | $ 17,002 | $ 14,898 |
Sec. 174 capitalization | 1,494 | 0 |
Research and development credits | 81 | 65 |
Stock Based Compensation | 1,447 | 1,216 |
Accruals and Other | 995 | 324 |
Total deferred tax assets (gross) | 21,018 | 16,503 |
Less valuation allowance | (20,302) | (15,969) |
Net deferred tax assets | 716 | 534 |
Depreciation and other | (716) | (534) |
Net deferred tax liabilities | (716) | (534) |
Net deferred income taxes | $ 0 | $ 0 |
Note 18 - Major Customers and_3
Note 18 - Major Customers and Related Information (Details Textual) - Customer Concentration Risk [Member] | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Revenue Benchmark [Member] | Distributors [Member] | ||
Number of Major Customers | 1 | 2 |
Revenue Benchmark [Member] | Distributor One [Member] | ||
Concentration Risk, Percentage | 37% | 36% |
Revenue Benchmark [Member] | Distributor Two [Member] | ||
Concentration Risk, Percentage | 25% | |
Accounts Receivable [Member] | Distributors [Member] | ||
Number of Major Customers | 1 | 1 |
Accounts Receivable [Member] | Distributor One [Member] | ||
Concentration Risk, Percentage | 67% | 70% |
Note 17 - Major Customers and R
Note 17 - Major Customers and Related Information - Disaggregation of Revenue by Geographic Region (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Revenues | $ 6,133 | $ 8,049 |
Americas [Member] | ||
Revenues | 3,773 | 5,315 |
Europe, Middle East and Africa [Member] | ||
Revenues | 2,302 | 2,487 |
Asia Pacific [Member] | ||
Revenues | $ 58 | $ 247 |
Note 19 - Business Combinatio_2
Note 19 - Business Combination (Details Textual) - Intrensic, LLC [Member] - USD ($) | Aug. 16, 2023 | Aug. 16, 2023 | Aug. 09, 2023 |
Payments to Acquire Businesses, Gross | $ 554,000 | $ 554,000 | $ 553,588 |
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | 1,250,000 | 1,250,000 | 1,250,000 |
Business Combination, Consideration Transferred, Equity Interests Issued and Issuable | $ 1,938,000 | ||
Business Acquisition, Transaction Costs | $ 38,000 | $ 38,000 |
Note 19 - Business Combinatio_3
Note 19 - Business Combination - Schedule of Business Acquisitions (Details) - USD ($) | Aug. 16, 2023 | Aug. 16, 2023 | Aug. 09, 2023 | Dec. 31, 2023 | Dec. 31, 2022 |
Goodwill | $ 1,610,000 | $ 0 | |||
Intrensic, LLC [Member] | |||||
Cash and cash equivalents | $ 3,000 | $ 3,000 | |||
Accounts receivable | 91,000 | 91,000 | |||
Inventory | 61,000 | 61,000 | |||
Goodwill | 1,610,000 | 1,610,000 | |||
Total assets | 2,495,000 | 2,495,000 | |||
Liabilities | 3,000 | 3,000 | |||
Equity | 2,492,000 | 2,492,000 | |||
Total liabilities and equity | 2,495,000 | 2,495,000 | |||
Cash | 554,000 | 554,000 | $ 553,588 | ||
Equity | 1,938,000 | ||||
Liabilities assumed | 3,000 | ||||
Total | 2,495,000 | ||||
Intrensic, LLC [Member] | Technology-Based Intangible Assets [Member] | |||||
Intangible assets | 490,000 | 490,000 | |||
Intrensic, LLC [Member] | Customer Relationships [Member] | |||||
Intangible assets | 160,000 | 160,000 | |||
Intrensic, LLC [Member] | Trademarks and Trade Names [Member] | |||||
Intangible assets | $ 80,000 | $ 80,000 |
Note 20 - Subsequent Events (De
Note 20 - Subsequent Events (Details Textual) - $ / shares | Jan. 14, 2024 | Aug. 19, 2024 | Jul. 03, 2023 |
Series A Preferred Stock [Member] | |||
Preferred Stock, Convertible, Conversion Price (in dollars per share) | $ 1.45 | ||
Forecast [Member] | Series A Preferred Stock [Member] | Maximum [Member] | |||
Preferred Stock, Convertible, Conversion Price (in dollars per share) | $ 1 | ||
Restricted Stock [Member] | The 2017 Stock Incentive Plan [Member] | Chief Executive Officer [Member] | Subsequent Event [Member] | |||
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Grants in Period | 632,911 |