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RELATED PARTY TRANSACTIONS
 6 Months Ended
Jun. 29, 2024
Related Party Transactions [Abstract]  
RELATED PARTY TRANSACTIONS

15. RELATED PARTY TRANSACTIONS

 

The Company may from time to time enter into agreements with stockholders, affiliates and other companies engaged in certain aspects of the display, electronics, optical and software industries as part of its business strategy. In addition, the wearable computing product market is relatively new and there may be other technologies the Company needs to purchase from affiliates to enhance its product offering.

 

On January 5, 2023, the Company entered into a Technology License Agreement and an Asset Purchase Agreement (the “LST Agreements”) with Lightning Silicon Technology, Inc. (“LST”). Pursuant to the LST Agreements, the Company issued a license to LST for certain technology associated with its Organic Light Emitting Technology, transferred in-process development contracts with two customers and accounts receivables that the Company had previously determined were not collectible. The technology license agreement provides for Kopin to transfer certain patents to LST if LST achieves certain milestones, however upon transfer Kopin will receive a license to the technology. To the extent LST makes improvements to the technology licensed from Kopin, Kopin will receive a license for these improvements for certain markets. Kopin is not obligated to provide any additional funding support to LST. As consideration for the transaction, the Company received 18,000,000 common shares representing a 20.0% equity stake in LST. The Company will also receive a royalty based on unit sales of products that utilize the technology licensed. Drs. John Fan, the Company’s former President and CEO and former Chairman of the Board, Boryeu Tsaur, a former Executive Vice President of the Company and Hong Choi, the Company’s former Chief Technology Officer terminated their employment with the Company and became investors in and members of the management team of LST. Dr. Fan is the Founder of LST. As a result of this transaction, in 2022 the Company wrote off the two operating lease assets associated with facilities used for the development of the Company’s organic light emitting diode (OLED) products. The Company has recorded its investment in LST at $0 as of June 29, 2024.

 

During the three and six months ended June 29, 2024 and July 1, 2023, the Company had the following transactions with related parties:

  

   Three Months Ended 
   June 29, 2024   July 1, 2023 
   Sales   Purchases   Sales   Purchases 
RealWear, Inc.  $109,830    10,550   $562,622   $— 
HMDmd, Inc.   122,259    —    236,279    — 
Vuzix Corp   —    4,955    —    — 
Lightning Silicon Technology, Inc.   2,234    81,800    —    168,800 
   $234,323    97,305   $798,901   $168,800 

 

   Six Months Ended 
   June 29, 2024   July 1, 2023 
   Sales   Purchases   Sales   Purchases 
RealWear, Inc.  $217,140    10,550   $769,646   $— 
HMDmd, Inc.   222,259    —    502,755    — 
Vuzix Corp   —    11,905    —    — 
Lightning Silicon Technology, Inc.   2,234    164,200    —    208,055 
   $441,633    186,655   $1,272,401   $208,055 

 

At June 29, 2024 and December 30, 2023, the Company had the following receivables from and payables to related parties:

 

   June 29, 2024   December 30, 2023 
   Receivables   Payables   Receivables   Payables 
RealWear, Inc.  $109,830   $—   $94,902   $— 
HMDmd, Inc.   120,936    —    15,000    — 
Vuzix Corp   —    4,955    —    — 
Lightning Silicon Technology, Inc.   1,233    59,200    35,013    97,600 
   $231,999   $64,155   $144,915   $97,600