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STOCKHOLDERS’ EQUITY | 12 Months Ended
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Dec. 31, 2024
Equity [Abstract] |
STOCKHOLDERS’ EQUITY | STOCKHOLDERS’ EQUITY Common Stock 1-for-7 Reverse Stock Split At the Company’s annual meeting of stockholders held on June 15, 2023, the Company’s stockholders approved a reverse stock split of the outstanding shares of the Company’s common stock at a ratio ranging from any whole number of at least 1-for-2 and up to 1-for-10, with the exact ratio within the foregoing range to be determined by the board of directors in its sole discretion. On June 15, 2023, our board of directors determined to set the reverse stock split at 1-for-7 (the “Split Ratio”). The reverse stock split became effective on June 16, 2023 (the “Effective Time”). At the Effective Time, every seven shares of common stock issued and outstanding automatically combined into one validly issued, fully paid and non-assessable share of common stock. No fractional shares were issued as a result of the reverse stock split. The fractional shares were settled in cash in an amount not material to the Company. The $0.0001 par value per share of common stock and other terms of the common stock were not affected by the reverse stock split. The number of authorized shares of common stock under the Certificate of Incorporation remained unchanged at 50,000,000 shares. The reverse stock split was effected solely to increase the per share trading price of the common stock to satisfy the Bid Price Rule for continued listing on Nasdaq. The common stock began trading on Nasdaq on a split-adjusted basis at the opening of trading on June 19, 2023. Private Placements The Company entered the securities purchase agreements with certain investors and issued 912,050 and 2,870,964 shares (including debt-to-equity exchange noted in Note 7, “Debt”) of common stock during the years ended December 31, 2024 and 2023, respectively. June 2024 Private Placement On June 21, 2024, the Company entered into a securities purchase agreement with Sander Electronics Inc., a shareholder of the Company controlled by Mr. Chiao Chieh (Jay) Huang, CEO of the Company, pursuant to which the Company agreed to issue and sell in a private placement an aggregate of 534,591 shares of the Company’s common stock, par value $0.0001 per share, for a purchase price per share of $1.59 (the “June 2024 Private Placement”). Consideration for the transaction included an exchange of $850 thousand. Aggregate gross proceeds to the Company in respect of the June 2024 Private Placement were approximately $850 thousand. The June 2024 Private Placement closed on June 21, 2024. March 2024 Private Placement On March 28, 2024, the Company entered into a securities purchase agreement with certain purchaser, pursuant to which the Company agreed to issue and sell in a private placement an aggregate of 283,019 shares of the Company’s common stock, par value $0.0001 per share, for a purchase price per share of $1.59 (the “March 2024 Private Placement”). Consideration for the transaction included exchange of $450 thousand in the aggregate of outstanding amounts on previous advanced capital contributions, as described above in Note 6, “Debt”. Aggregate gross proceeds to the Company in respect of the March 2024 Private Placement were approximately $450 thousand. The March 2024 Private Placement was priced at-the-market under the Nasdaq rules. September 2023 Private Placement On September 29, 2023, the Company entered into a securities purchase agreement with certain purchasers, pursuant to which the Company agreed to issue and sell in a private placement an aggregate of 853,658 shares of the Company’s common stock, par value $0.0001 per share, for a purchase price per share of $2.05 (the “September 2023 Private Placement”). Aggregate gross proceeds to the Company in respect of the September 2023 Private Placement were approximately $1.75 million. The September 2023 Private Placement closed on September 29, 2023. June 2023 Private Placement On June 29, 2023, the Company entered into a securities purchase agreement with certain purchasers, pursuant to which the Company agreed to issue and sell in a private placement an aggregate of 746,875 shares of the Company’s common stock, par value $0.0001 per share, for a purchase price per share of $1.76 (the “June 2023 Private Placement”). One of the purchasers was Mr. Huang, the Company’s CEO. Aggregate gross proceeds to the Company in respect of the June 2023 Private Placement were approximately $1.3 million. The June 2023 Private Placement closed on June 29, 2023. March 2023 Private Placements On March 28, 2023, the Company entered into a securities purchase agreement with Mr. Chiao Chieh (Jay) Huang, pursuant to which the Company agreed to issue and sell, in a private placement (the “March 28, 2023 Private Placement”), 15,500 shares of the Company’s common stock for a purchase price of $3.55 per share. On March 30, 2023, the Company entered into a securities purchase agreement with Mei Yun (Gina) Huang, a member of the Board of Directors, pursuant to which the Company agreed to issue and sell, in a private placement (collectively with the March 28, 2023 Private Placement, the “March 2023 Private Placements”), 71,428 shares of the Company’s common stock for a purchase price of $3.50 per share. Aggregate gross proceeds to the Company in respect of the March 2023 Private Placements were $305 thousand. Each of the March 2023 Private Placements was priced at-the-market under the Nasdaq rules. February 2023 Private Placement On February 24, 2023, the Company entered into a securities purchase agreement with Mei Yun (Gina) Huang, a member of the Board of Directors, pursuant to which the Company agreed to issue and sell, in a private placement (the “February 2023 Private Placement”), 114,744 shares of the Company’s common stock, for a purchase price of $3.49 per share. Gross proceeds to the Company in respect of the February 2023 Private Placement were $400 thousand. The February 2023 Private Placement was priced at fair market value under the Nasdaq rules. January 2023 Sander Electronics Private Placement On January 17, 2023, the Company entered into a securities purchase agreement (the “Sander Purchase Agreement”) with certain purchasers associated with Sander Electronics, Inc., pursuant to which the Company agreed to issue and sell in a private placement (the “Sander Private Placement”) an aggregate of 778,017 shares of common stock for a purchase price per share of $3.51. Consideration for the transaction included exchange of approximately $657 thousand in the aggregate of outstanding amounts on previous short-term bridge financings, including the 2022 Promissory Notes issued to Mr. Huang, as described above in Note 7, “Debt”. Aggregate gross proceeds from the Sander Private Placement were approximately $2.1 million. The Sander Private Placement was priced at-the-market under the Nasdaq rules. January 2023 Transactions with Mei Yun (Gina) Huang On January 5, 2023, the Company entered into a securities purchase agreement with Mei Yun (Gina) Huang, a member of the Board of Directors, pursuant to which the Company agreed to issue and sell, in a private placement, 36,828 shares of the Company’s common stock, for a purchase price of $2.72 per share. On January 10, 2023, the Company entered into a securities purchase agreement with Ms. Huang, pursuant to which the Company agreed to issue and sell, in a private placement, 46,543 shares of the Company’s common stock for a purchase price of $3.22 per share. Aggregate gross proceeds to the Company in respect of these private placements to Ms. Huang were $250 thousand. Each of the private placements to Ms. Huang was priced at fair market value under the Nasdaq rules. On January 17, 2023, the Company and Ms. Huang entered into exchange agreements pursuant to which the Company and Ms. Huang agreed to exchange the approximately $817 thousand aggregate outstanding amounts on previous short-term bridge financings, including the 2022 Promissory Notes issued to Ms. Huang, as described above in Note 7, “Debt”, for an aggregate of 207,371 shares of common stock at a price per share of $3.94. The exchanges were priced at fair market value under the Nasdaq rules. Preferred Stock The Series A Preferred Stock was created by the filing of a Certificate of Designation with the Secretary of State of the State of Delaware on March 29, 2019, which designated 2,000,000 shares of the Company’s preferred stock, par value $0.0001 per share, as Series A Preferred Stock (the “Original Series A Certificate of Designation”). On January 15, 2020 with prior stockholder approval, the Company amended the Certificate of Incorporation to increase the number of authorized shares of preferred stock to 5,000,000. The Original Series A Certificate of Designation was also amended on January 15, 2020, to increase the number of shares of preferred stock designated as Series A Preferred Stock to 3,300,000 (the Original Series A Certificate of Designation, as so amended, the “Series A Certificate of Designation”). Pursuant to the Series A Certificate of Designation, each holder of outstanding shares of Series A Preferred Stock is entitled to vote with holders of outstanding shares of common stock, voting together as a single class, with respect to any and all matters presented to the stockholders of the Company for their action or consideration, except as provided by law. In any such vote, each share of Series A Preferred Stock shall entitle its holder to a number of votes equal to 1.582% of the number of shares of common stock into which such share of Series A Preferred Stock is convertible. The Series A Preferred Stock (a) has a preference upon liquidation equal to $0.67 per share and then participates on an as-converted basis with the common stock with respect to any additional distributions, (b) shall receive any dividends declared and payable on our common stock on an as-converted basis, and (c) is convertible at the option of the holder into shares of our common stock on a 1- for- 35 basis. As of December 31, 2024 and 2023, there were 876,447 Series A Preferred Stock issued and outstanding which can be convertible into 25 thousand shares of common stock at the option of the holder. Warrants During the years ended December 31, 2024 and 2023, no warrants were exercised. As of December 31, 2024 and 2023, we had the following outstanding warrants:
| As of December 31, 2024 |  | As of December 31, 2023 |  |  |  |
| Number of Underlying Shares |  | Exercise Price |  | Expiration
June 2022 Warrants | 384,615 |  | 384,615 |  | $9.10 |  | December 16, 2026
December 2021 Warrants | 182,630 |  | 182,630 |  | $24.64 |  | June 7, 2027
January 2020 Investor Warrants | 26,819 |  | 26,819 |  | $23.59 |  | January 13, 2025
January 2020 Placement Agent Warrants | 5,954 |  | 5,954 |  | $34.96 |  | January 13, 2025
| 600,018 |  | 600,018 |  |  |  |
Stock-based Compensation Stock-based compensation expense is attributable to stock options and restricted stock unit awards. For all stock-based awards, we recognize expense using a straight-line amortization method. The following table summarizes stock-based compensation expense and the impact it had on operations for the periods presented (in thousands):
| For the year ended December 31,
| 2024 |  | 2023 |  |
Cost of sales | $ | — |  |  | $ | 2 |  |  |
Selling, general, and administrative | 4 |  |  | 42 |  |  |
Total stock-based compensation | $ | 4 |  |  | $ | 44 |  |  |
At December 31, 2024 and 2023, we had unearned stock compensation expense of $2 thousand and $64 thousand, respectively. These costs will be charged to expense and amortized on a straight-line basis in subsequent periods. The remaining weighted average period over which the unearned compensation is expected to be amortized was approximately 1.8 years as of December 31, 2024 and 2.8 years as of December 31, 2023. Stock Options For the years ended December 31, 2024 and 2023, the Company did not grant any stock options. The fair value of each stock option is estimated on the date of grant using the Black-Scholes option pricing model. Estimates utilized in the calculation include the expected life of the option, risk-free interest rate, and expected volatility, and are further comparatively detailed as follows:
| 2024 |  | 2023 |  |
Fair value of options issued | $ | — |  |  | $ | 2.49 |  |  |
Exercise price | $ | — |  |  | $ | 3.04 |  |  |
Expected life of option (in years) | 0 |  | 6.1 |  |
Risk-free interest rate | — | % |  | 3.5 | % |  |
Expected volatility | — | % |  | 101.8 | % |  |
Dividend yield | 0.00 | % |  | 0.00 | % |  |
Options outstanding under all plans at December 31, 2024 have a contractual life of ten years, and vesting periods between one and four years. A summary of option activity under all plans was as follows:
| Number of Options |  | Weighted Average Exercise Price Per Share
Outstanding at December 31, 2022 | 47,102 |  |  | 13.78 |
Granted | 11,427 |  |  | $ | 3.04 |
Canceled/forfeited | (24,076) |  |  | 18.55 |
Expired | (3,878) |  |  | 17.03 |
Balance at December 31, 2023 | 30,575 |  |  | $ | 5.60 |
Expired | (9) |  |  | 53.33 |
Balance at December 31, 2024 | 30,566 |  | $ | 5.58 |
Vested and expected to vest at December 31, 2024 | 28,376 |  |  | $ | 5.67 |
Exercisable at December 31, 2024 | 16,735 |  |  | $ | 6.20 |
The “Expected to Vest” options are the unvested options that remain after applying the pre-vesting forfeiture rate assumption to total unvested options. No options were exercised during 2024 and 2023. All outstanding equity awards were out of the money as of December 31, 2024. The options outstanding at December 31, 2024 have been segregated into ranges for additional disclosure as follows:
OPTIONS OUTSTANDING |  | OPTIONS EXERCISABLE
Range of Exercise Prices |  | Number of Shares Outstanding |  | Weighted Average Remaining Contractual Life (in years) |  | Weighted Average Exercise Price |  | Number of Shares Exercisable |  | Weighted Average Remaining Contractual Life (in years) |  | Weighted Average Exercise Price
$3.04 | — | $4.14 |  | 7,142 |  |  | 8.3 |  | $ | 3.04 |  |  | 2,976 |  |  | 8.3 |  | $ | 3.04 |
$4.15 | — | $5.73 |  | 21,428 |  |  | 7.7 |  | 5.25 |  |  | 12,062 |  |  | 7.7 |  | 5.25 |
$5.74 | — | $13.48 |  | 882 |  |  | 6.2 |  | 8.34 |  |  | 680 |  |  | 5.9 |  | 8.97 |
$13.49 | — | $27.55 |  | 661 |  |  | 4.8 |  | 16.80 |  |  | 661 |  |  | 4.8 |  | 16.80 |
$27.56 | — | $48.79 |  | 453 |  |  | 6.1 |  | 39.61 |  |  | 356 |  |  | 6.1 |  | 39.97 |
|  |  |  | 30,566 |  |  | 7.7 |  | $ | 5.58 |  |  | 16,735 |  |  | 7.6 |  | $ | 6.20 |
Restricted Stock Units In 2020, we began issuing restricted stock units to certain employees and non-employee Directors under the 2020 Plan with vesting periods ranging from one to four years. During the years ended December 31, 2024 and 2023, no restricted stock units were issued, and as of December 31, 2024 and 2023, there were no outstanding restricted stock units.

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