What changed in this filing

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Item 1. Financial Statements

2024-08-14 compared with 2024-05-20 · 305 added, 239 removed, 649 unchanged (46% of the section changed)

3 unchanged sentences

(in thousands, except share and per share data)

March 31, 2024

June 30, 2024

December 31, 2023

5 unchanged sentences

Property and equipment, net

Liabilities, Convertible Redeemable Preferred Stock and Stockholders’ Deficit

Liabilities, Convertible Redeemable Preferred Stock and Stockholders’ Equity / (Deficit)

Current Liabilities:

8 unchanged sentences

375,000 shares authorized;

0 and 38,335 shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively

Stockholders’ Deficit:

0 and 38,335 shares issued and outstanding as of June 30, 2024 and December 31, 2023, respectively

Stockholders’ Equity / (Deficit):

Common stock, par value $ 0.0001 ;

300,000,000 shares authorized;

1,757,195 and 222,380 shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively

4,921,434 and 222,380 shares issued and outstanding as of June 30, 2024 and December 31, 2023, respectively

Additional paid-in capital

Accumulated deficit

Total stockholders’ deficit

Total liabilities, convertible preferred stock and stockholders’ deficit

Total stockholders’ equity / (deficit)

Total liabilities, convertible preferred stock and stockholders’ equity / (deficit)

(1) The condensed consolidated balance sheet as of December 31, 2023 was derived from the audited consolidated balance sheet as of that date.

3 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

For the three months ended March 31, 2024 and 2023

For the three and six months ended June 30, 2024 and 2023

(in thousands, except share and per share data)

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

Cost of revenue

Gross deficit

Gross profit (deficit)

Operating Expenses:

6 unchanged sentences

Change in fair value of warrant liabilities

Loss on debt extinguishment

Other expense, net

Income (loss) before provision for income taxes

Loss before provision for income taxes

Provision for income taxes

Net income (loss)

Deemed dividend on conversion of Series B preferred for common stock and repurchase of Series B preferred stock

6 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT)

For the three months ended March 31, 2024 and 2023

For the three and six months ended June 30, 2024 and 2023

(in thousands, except share and per share data)

6 unchanged sentences

Stock-based compensation

Cumulative effect of ASC 2020-06 adoption

Cumulative effect of ASU 2020-06 adoption

Issuance of Series B preferred stock in connection with warrant exercise, net of discounts

5 unchanged sentences

Balance as of March 31, 2024

Stock-based compensation

Issuance of common stock in connection with warrant exercise

Issuance of common stock and warrants, net of offering costs

Issuance of common stock to vendors

Restricted stock awards cancelled

Release of vested restricted common stock

Conversion of liability warrants to equity warrants

Balance as of June 30, 2024

Convertible Preferred Stock

2 unchanged sentences

Paid-in Capital

Equity/(Deficit)

Balance as of December 31, 2022

5 unchanged sentences

Balance as of March 31, 2023

Stock-based compensation

Release of vested restricted common stock

Restricted stock awards cancelled

Issuance of common stock and warrants, net of offering costs

Issuance of common stock in connection with warrant exercise

Balance as of June 30, 2023

Share and per share amounts have been retroactively adjusted to reflect the impact of a 1-for-100 reverse stock split effected in January 2023 as well as a 1-for-150 reverse stock split effected in April 2024, as discussed in Note 1.

2 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

For the three months ended March 31, 2024 and 2023

For the six months ended June 30, 2024 and 2023

(in thousands)

Three Months Ended March 31,

Six Months Ended June 30,

Cash flows from operating activities:

Net income (loss)

Adjustments to reconcile net loss to net cash used in operating activities:

2 unchanged sentences

Amortization of debt discounts

Change in fair value of warrant liabilities

Change in fair value of warrant liability

Loss on extinguishment of convertible note payable

Changes in operating assets and liabilities:

6 unchanged sentences

Cash flows from investing activities:

Issuance of note receivable

Purchases of property and equipment

1 unchanged sentence

Cash flows from financing activities:

Proceeds from issuance of common stock in connection with warrant exercise

Proceeds from issuance of common stock and warrants, net of offering costs

Proceeds from issuance of short-term loan, net of issuance costs

Proceeds from issuance of common stock and prefunded warrants, net of issuance costs

Proceeds from exercise of warrants

Repurchase of Series B preferred stock and warrants

Repayment of finance lease

Repurchase of Series B preferred stock warrants

Repayment of short-term loan

Repayment of convertible note payable

Repayment of finance lease

Net cash provided by financing activities

Net increase in cash and cash equivalents

Net decrease in cash and cash equivalents

Cash and cash equivalents as of beginning of period

4 unchanged sentences

Noncash Investing and Financing Activities:

Issuance of warrant liabilities in connection with financing

Conversion of liability warrants to equity warrants

Issuance of warrant liability in connection with financing

Deemed dividend on conversion of Series B preferred stock and repurchase of Series B preferred stock

1 unchanged sentence

Cashless exercise of warrants

Issuance of common stock to vendors

warrant exercise in connection with loan settlement

Issuance of common stock in connection with Series B preferred stock

Issuance of warrant liability in connection with February 2023 offering

Issuance of common stock in connection with convertible promissory note

Record Right-of-Use Assets obtained in exchange for modified operating lease liabilities

Deferred offering costs reclassed from prepaid expenses

2 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2024 and 2023

For the Three and Six Months Ended June 30, 2024 and 2023

Business and Summary of Significant Accounting Policies

4 unchanged sentences

Nasdaq Compliance

On October 5, 2023, the Company received notice from the Listing Qualifications Staff (the “Staff”) of Nasdaq that the bid price of its listed securities had closed at less than $ 1 per share over the previous 30 consecutive business days, and, as a result, did not comply with Nasdaq Listing Rule 5550(a)(2) (the “Minimum Bid Price Requirement”).

Therefore, in accordance with Listing Rule 5810(c)(3)(A), the Company was provided 180 calendar days, or until April 2, 2024, to regain compliance with the Minimum Bid Price Requirement.

On November 17, 2023, the Staff notified the Company that it was not in compliance with Nasdaq Listing Rule 5550(b)(1), which requires companies listed on Nasdaq to maintain a minimum of $ 2,500,000 in stockholders’ equity for continued listing (the “Stockholders’ Equity Requirement”).

The Company reported stockholders’ equity (deficit) of ($ 885,000 ) in its Quarterly Report on Form 10-Q for the quarter ended September 30, 2023, and, as a result, did not satisfy the Stockholders’ Equity Requirement pursuant to Listing Rule 5550(b)(1).

On February 14, 2024, the Company received notice (the “February 14 Letter”) from the Staff that the Staff had determined that as of February 14, 2024, the Company’s securities had a closing bid price of $ 0.10 or less for ten consecutive trading days triggering application of Listing Rule 5810 (c)(3)(A)(iii) which states in part:

if during any compliance period specified in Rule 5810(c)(3)(A), a company’s security has a closing bid price of $ 0.10 or less for ten consecutive trading days, the Listing Qualifications Department shall issue a Staff Delisting Determination under Rule 5810 with respect to that security (the “Low Priced Stocks Rule”).

As a result, the Staff determined to delist the Company’s securities from Nasdaq, unless the Company timely requests an appeal of the Staff’s determination to a Hearings Panel (the “Panel”), pursuant to the procedures set forth in the Nasdaq Listing Rule 5800 Series.

The Company requested a hearing before the Panel to appeal the February 14 Letter and to address all outstanding matters, including compliance with the Minimum Bid Price Requirement, the Low Priced Stocks Rule and the Stockholders’ Equity Requirement, which hearing was held on March 28, 2024.

On April 5, 2024, the Panel issued a decision (the “April 2024 Decision”) granting the Company’s request for continued listing on the Nasdaq Capital Market, subject to the Company regaining compliance with (a) the Minimum Bid Price Requirement pursuant to Listing Rule 5550 (a)(2) by April 28, 2024, and (b) the Stockholders’ Equity Requirement pursuant to Listing Rule 5550 (b)(1) by June 28, 2024.

On April 29, 2024, the Company received a letter (the “April 29 Letter”) from Nasdaq notifying the Company that it has regained compliance with the Minimum Bid Price Requirement pursuant to Listing Rule 5550 (a)(2), as required by the April 2024 Decision.

The Company will be subject to a mandatory panel monitor for a period of one year from April 29, 2024 pursuant to Nasdaq Listing Rule 5815(d)(4)(B).

If, within that one-year monitoring period, the Staff finds the Company again out of compliance with the Minimum Bid Price Requirement, notwithstanding Nasdaq Listing Rule 5810(c)(2), the Company will not be permitted to provide the Staff with a plan of compliance with respect to that deficiency and the Staff will not be permitted to grant additional time for the Company to regain compliance with respect to that deficiency, nor will the Company be afforded an applicable cure or compliance period pursuant to Nasdaq Listing Rule 5810 (c)(3).

Instead, the Staff will issue a delist determination letter and the Company will have an opportunity to request a new hearing with the initial Panel or a newly convened hearings panel if the initial Panel is unavailable.

The Company is currently in compliance with the listing rules of The Nasdaq Stock Market LLC (“Nasdaq”), subject to the monitorings described below.

On April 29, 2024, Nasdaq notified the Company in a letter that the Company has regained compliance with the minimum bid price requirement under Nasdaq Listing Rule 5550 (a)(2) (the “Minimum Bid Price Requirement”) as required by a hearing panel’s decision on April 5, 2024.

The Company is subject to monitoring for a period of one year from the date of the letter.

If, within that one-year monitoring period, Nasdaq’s Listing Qualifications staff (the “Staff”) finds the Company again out of compliance with the Minimum Bid Price Requirement, the Company will not be permitted to provide the Staff with a plan of compliance with respect to such deficiency and the Staff will not be permitted to grant additional time for the Company to regain compliance with respect to such deficiency, nor will the Company be afforded an applicable cure or compliance period.

Instead, the Staff will issue a delist determination letter and the Company will have an opportunity to request a new hearing with a hearings panel.

The Company will have the opportunity to respond and present to the panel.

On July 3, 2024, Nasdaq notified the Company in a letter that the Company has regained compliance with the equity requirement under Nasdaq Listing Rule 5550(b)(1) (the “Equity Rule”) as required by the panel’s April 5, 2024 decision.

The Company is subject to monitoring for a period of one year from the date of the letter.

If, within that one-year monitoring period, the Staff finds the Company again out of compliance with the Equity Rule, the Company will not be permitted to provide the Staff with a plan of compliance with respect to such deficiency and the Staff will not be permitted to grant additional time for the Company to regain compliance with respect to such deficiency, nor will the Company be afforded an applicable cure or compliance period.

Instead, the Staff will issue a delist determination letter and the Company will have an opportunity to request a new hearing with a hearings panel.

The Company will have the opportunity to respond and present to the panel.

WISA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2024 and 2023

For the Three and Six Months Ended June 30, 2024 and 2023

Business and Summary of Significant Accounting Policies, continued

1 unchanged sentence

April 2024 Reverse Stock Split

On April 4, 2024, the Board approved a 1-for-150 reverse stock split (the “April 2024 Reverse Stock Split”) of our outstanding shares of common stock and authorized the filing of a certificate of amendment to our certificate of incorporation, as amended, with the Secretary of State of the State of Delaware (the “Certificate of Amendment”) to effect the April 2024 Reverse Stock Split.

On April 12, 2024, the April 2024 Reverse Stock Split was effected and the condensed consolidated financial statements have been retroactively adjusted.

23 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2024 and 2023

For the Three and Six Months Ended June 30, 2024 and 2023

Business and Summary of Significant Accounting Policies, continued

6 unchanged sentences

The Company performs credit evaluations of its customers’ financial condition and may, in certain circumstances, require full or partial payment in advance of shipping.

As of March 31, 2024 and December 31, 2023, there was no allowance for credit losses.

As of March 31, 2024, the Company had three customers accounting for 58 %, 16 %,and 10 % of accounts receivable.

As of June 30, 2024 and December 31, 2023, there was no allowance for credit losses.

As of June 30, 2024, the Company had four customers accounting for 43 %, 33 %, 12 %and 11 % of accounts receivable.

As of December 31, 2023, the Company had two customers accounting for 71 % and 20 % of accounts receivable.

The Company had three customers accounting for 35 %, 29 % and 21 % of its net revenue for the three months ended March 31, 2024.

The Company had four customers accounting for 25 %, 19 %, 14 % and 13 % of its net revenue for the three months ended December 31, 2023.

The Company had four customers accounting for 33 %, 27 %, 20 % and 11 % of its net revenue for the three months ended June 30, 2024.

The Company had four customers accounting for 28 %, 27 %, 19 % and 10 % of its net revenue for the six months ended June 30, 2024.

The Company had four customers accounting for 35 %, 13 %, 12 % and 11 % of its net revenue for the three months ended June 30, 2023.

The Company had two customers accounting for 29 % and 17 % of its net revenue for the six months ended June 30, 2023.

The Company’s future results of operations involve a number of risks and uncertainties.

15 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2024 and 2023

For the Three and Six Months Ended June 30, 2024 and 2023

Business and Summary of Significant Accounting Policies, continued

17 unchanged sentences

Warrants for our common shares, convertible redeemable preferred shares, and derivative financial instruments are classified as equity if the contracts (1) require physical settlement or net-share settlement or (2) give the Company a choice of net-cash settlement or settlement in its own shares (physical settlement or net-share settlement).

Contracts which (1) require net-cash settlement (including a requirement to net cash settle the contract if an event occurs and if that event is outside the control of the Company), (2) give the counterparty a choice of net-cash settlement or settlement in shares (physical settlement or net-share settlement), or (3) that contain reset provisions that do not qualify for the scope exception are classified as equity or liabilities.

Contracts which (1) require net-cash settlement (including a requirement to net cash settle the contract if an event occurs and if that event is outside the control of the Company), (2) give the counterparty a choice of net-cash settlement or settlement in shares (physical settlement or net-share settlement), or (3) contain reset provisions that do not qualify for the scope exception are classified as equity or liabilities.

The Company assesses classification of its warrants for shares of common stock and other derivatives at each reporting date to determine whether a change in classification between equity and liabilities is required.

1 unchanged sentence

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2024 and 2023

For the Three and Six Months Ended June 30, 2024 and 2023

Business and Summary of Significant Accounting Policies, continued

27 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2024 and 2023

For the Three and Six Months Ended June 30, 2024 and 2023

Business and Summary of Significant Accounting Policies, continued

During the three months ended March 31, 2024 and 2023, net revenue consisted of the following:

For the Three Months Ended March 31,

During the three months ended June 30, 2024 and 2023, net revenue consisted of the following:

For the Three Months Ended June 30,

For the Six Months Ended June 30,

(in thousands)

5 unchanged sentences

Accounts receivables are recorded when the right to this consideration becomes unconditional.

The Company does not have any material contract assets as of March 31, 2024 and December 31, 2023.

During the three month ended March 31, 2024, the Company did not recognize any revenue that was included in the contract liabilities balance as of December 31, 2023.

The Company does not have any material contract assets as of June 30, 2024 and December 31, 2023.

During the six month ended June 30, 2024, the Company did not recognize any revenue that was included in the contract liabilities balance as of December 31, 2023.

(in thousands)

12 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2024 and 2023

For the Three and Six Months Ended June 30, 2024 and 2023

Business and Summary of Significant Accounting Policies, continued

3 unchanged sentences

Advertising costs are charged to sales and marketing expenses as incurred.

Advertising costs for the three months ended March 31, 2024 and 2023 were $ 147,000 and $ 155,000 , respectively.

Advertising costs for the three and six months ended June 30, 2024 were $ 117,000 and $ 264,000 , respectively.

Advertising costs for the three and six months ended June 30, 2023 were $ 118,000 and $ 273,000 , respectively.

Comprehensive Loss

1 unchanged sentence

Accordingly, comprehensive loss may include certain changes in equity that are excluded from net loss.

For the three months ended March 31, 2024 and 2023, the Company’s comprehensive loss is the same as its net loss.

For the three and six months ended June 30, 2024 and 2023, the Company’s comprehensive loss is the same as its net loss.

Foreign Currency

5 unchanged sentences

Cumulative gains and losses from the translation of these operations’ financial statements are reported as a separate component of stockholders’ equity, while foreign currency transaction gains or losses, resulting from re-measuring local currency to the U.S.

dollar are recorded in the condensed consolidated statement of operations in other income (expense), net and were not material for the three months ended March 31, 2024 and 2023.

dollar are recorded in the condensed consolidated statement of operations in other income (expense), net and were not material for the three and six months ended June 30, 2024 and 2023.

Net Loss per Common Share

7 unchanged sentences

Net loss is adjusted for any deemed dividends to preferred stockholders to compute income available to common stockholders.

For the three months ended March 31, 2024, warrants to purchase 1,985,138 shares of common stock, 5,362 shares of restricted stock, 17 shares of restricted stock issued under an inducement grant and 14 shares underlying restricted stock units, have been excluded from the calculation of net loss per common share because the inclusion would be antidilutive.

For the three months ended March 31, 2023, warrants to purchase 17,873 shares of common stock, 94 shares of restricted stock, 19 shares of restricted stock issued under an inducement grant and 39 shares underlying restricted stock units have been excluded from the calculation of net loss per common share because the inclusion would be antidilutive.

As of June 30, 2024, warrants to purchase 9,793,531 shares of common stock, 260,441 shares of restricted stock, 16 shares of restricted stock issued under an inducement grant and 14 shares underlying restricted stock units, have been excluded from the calculation of net loss per common share because the inclusion would be antidilutive.

As of June 30, 2023, warrants to purchase 37,572 shares of common stock, 69 shares of restricted stock, 18 shares of restricted stock issued under an inducement grant and 36 shares underlying restricted stock units have been excluded from the calculation of net loss per common share because the inclusion would be antidilutive.

WISA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2024 and 2023

For the Three and Six Months Ended June 30, 2024 and 2023

Business and Summary of Significant Accounting Policies, continued

2 unchanged sentences

Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is “more-likely-than-not” that some portion or all of the deferred tax assets will not be realized.

The Company has recognized valuation allowances against its deferred tax assets as of March 31, 2024 and December 31, 2023.

The Company has recognized valuation allowances against its deferred tax assets as of June 30, 2024 and December 31, 2023.

Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.

4 unchanged sentences

The Company recognizes interest accrued and penalties related to unrecognized tax benefits in tax expense.

As of March 31, 2024 and December 31, 2023, the Company recognized no interest and penalties.

As of June 30, 2024 and December 31, 2023, the Company recognized no interest and penalties.

Recently Adopted Accounting Pronouncements

In August 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-06 “Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40):

Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity”.

This ASU simplifies accounting for convertible instruments by removing major separation models required under current U.S.

Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity.” This ASU simplifies accounting for convertible instruments by removing major separation models required under current U.S.

The Company adopted this standard on January 1, 2024 using the modified retrospective method by applying the ASU to financial instruments outstanding as of January 1, 2024, with the cumulative effect of adoption recognized at that date through an adjustment to the opening balance of retained earnings.

13 unchanged sentences

The Company is currently evaluating the impact of the adoption of this standard on our condensed consolidated financial statements.

We have reviewed other recent accounting pronouncements and concluded they are either not applicable to the business, or no material effect is expected on the condensed consolidated financial statements as a result of future adoption.

WISA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2024 and 2023

For the Three and Six Months Ended June 30, 2024 and 2023

Going Concern

The condensed consolidated financial statements of the Company have been prepared on a going concern basis, which contemplates the realization of assets and the discharge of liabilities in the normal course of business.

As of March 31, 2024, the Company had cash and cash equivalents of $ 2.8 million and reported net cash used in operations of $ 3.5 million during the three months ended March 31, 2024.

As of June 30, 2024, the Company had cash and cash equivalents of $ 6.1 million and reported net cash used in operations of $ 9.0 million during the six months ended June 30, 2024.

The Company expects operating losses to continue in the foreseeable future because of additional costs and expenses related to research and development activities, plans to expand its product portfolio, and increase its market share.

12 unchanged sentences

Raw materials

Work in progress

Finished goods

Total inventories

Note receivable:

On June 13, 2024, the Company entered into a Senior Secured Promissory Note and Security Agreement (“Promissory Note and Security Agreement”) with an unaffiliated third-party company (“the Borrower”).

Pursuant to the Promissory Note and Security Agreement, the Company agreed to provide the Borrower with a term loan in the principal amount of $ 150,000 (“June 2024 Note”).

The June 2024 Note matures on October 11, 2024.

Borrowings under the June 2024 Note bear interest at a rate per annum equal to 5.12 %.

On the maturity date, subject to any extension, the Borrower will be obligated to make a payment equal to all unpaid principal and accrued interest.

Note receivable is included in other assets on the condensed consolidated balance sheets.

There was no note receivable at December 31, 2023.

WISA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Six Months Ended June 30, 2024 and 2023

Balance Sheet Components, continued

Property and equipment, net (in thousands):

2 unchanged sentences

Property and equipment, net

WISA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2024 and 2023

Balance Sheet Components, continued

Depreciation and amortization expense for the three months ended March 31, 2024 and 2023 was $ 20,000 and $ 33,000 , respectively.

Depreciation and amortization expense for the three months ended June 30, 2024 and 2023 were approximately of $ 28,000 and $ 32,000 , respectively.

Depreciation and amortization expense for the six months ended June 30, 2024 and 2023 were approximately $ 48,000 and $ 65,000 , respectively.

Accrued liabilities (in thousands):

Accrued vacation

Accrued rebate

Accrued audit fees

Accrued lease liability, current portion

Accrued legal fees

Accrued rebate

Customer advance

Accrued compensation

Accrued lease liability, current portion

Accrued other

1 unchanged sentence

Convertible Promissory Note

On August 15, 2022, the Company entered into a Securities Purchase Agreement (the “August Purchase Agreement”), by and between the Company and an institutional investor (the “Convertible Note Investor”), pursuant to which the Company agreed to issue to the Investor a senior secured convertible note in the principal amount of $ 3,600,000 (the “Convertible Note”) and a warrant (the “August Warrant”) to purchase up to 140 shares of the Company’s common stock, at an initial exercise price of $ 14,955.00 per share (the “Exercise Price”), in consideration for $ 3,000,000 .

On August 15, 2022, the Company entered into a Securities Purchase Agreement (the “August Purchase Agreement”), by and between the Company and an institutional investor (the “Convertible Note Investor”), pursuant to which the Company agreed to issue to the Investor a senior secured convertible note in the principal amount of $ 3,600,000 (the “Convertible Note”) and a warrant to purchase up to 140 shares of the Company’s common stock, at an initial exercise price of $ 14,955.00 per share, in consideration for $ 3,000,000 .

Pursuant to the August Purchase Agreement, upon the closing of the private placement, pursuant to which Maxim Group LLC (“Maxim”) acted as placement agent (the “Private Placement”), the Company received gross proceeds of $ 3,000,000 .

1 unchanged sentence

The Company used the net proceeds primarily for working capital and general corporate purposes.

WISA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Six Months Ended June 30, 2024 and 2023

Borrowings, continued

The Convertible Note matured on August 15, 2024, does not bear interest and ranks senior to the Company’s existing and future indebtedness and is secured to the extent and as provided in the Security Agreements.

The Convertible Note is convertible in whole or in part at the option of the Convertible Note Investor into shares of Common stock (the “Conversion Shares”) at the Conversion Price (as defined below) at any time following the date of issuance of the Convertible Note.

The Convertible Note defines “Conversion Price” as equal to the lesser of (a) 90 % of the average of the five lowest daily VWAPs (as defined in the Convertible Note) during the previous twenty trading days prior to delivery to the Company of the Convertible Note Investor’s applicable notice of conversion (the “Conversion Notice”) and (b) $ 13,890.00 (the “Base Conversion Price”).

The Convertible Note defines “Conversion Price” as equal to the lesser of (a) 90 % of the average of the five lowest daily VWAPs (as defined in the Convertible Note) during the previous twenty trading days prior to delivery to the Company of the Convertible Note Investor’s applicable notice of conversion and (b) $ 13,890.00 (the “Base Conversion Price”).

The Base Conversion Price is subject to full ratchet antidilution protection, subject to a floor conversion price of $ 75.00 per share (the “Floor Price”).

In connection with the Private Placement, the Company issued warrants to the Convertible Note Investor and Maxim to purchase common shares of 140 and 13 , respectively (see Note 5 – Fair Value Measurements).

The sum of the fair value of the warrants, the original issue discount for interest, issuance costs and the derivative liability for the embedded conversion feature for the August 2022 Notes were recorded as debt discounts totaling $ 2,509,000 to be amortized to interest expense over the respective term using the effective interest method.

The sum of the fair value of the warrants, the original issue discount for interest, issuance costs and the derivative liability for the embedded conversion feature for the Convertible Note were recorded as debt discounts totaling $ 2,509,000 to be amortized to interest expense over the respective term using the effective interest method.

During the year ended December 31, 2023, the Company recognized $ 737,000 of interest expense from the amortization of debt discounts and repayment of the convertible note payable in April 2023.

In connection with the Private Placement, the Company entered into a placement agency agreement with Maxim (the “Placement Agency Agreement”), and agreed to issue to Maxim, a warrant to purchase up to an aggregate of 13 shares of Common Stock (the “Maxim Warrant”) at an initial exercise price of $ 14,955.00 per share, which is exercisable at any time on or after the six-month anniversary of the closing date of the Private Placement and will expire on the fifth ( 5 th ) anniversary of its date of issuance.

WISA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2024 and 2023

Borrowings, continued

Effective August 24, 2022, the Company and the Investor agreed to amend Section 3.1(b) of the Convertible Note to provide that the Conversion Price could not be lower than the Floor Price until stockholder approval has been obtained, after which stockholder approval the Floor Price may be reduced to no lower than $ 37.50 , subject to adjustment pursuant to the terms of the August 2022 Note.

The changes were effected by cancellation of the Convertible Note and the issuance of a replacement senior secured convertible note (the “New Convertible Note”) to the Investor.

8 unchanged sentences

On November 28, 2022, the Company entered into a waiver of rights (the “Waiver”) with the New Convertible Note Investor, pursuant to which the New Convertible Note Investor agreed to waive certain prohibitions under the August Purchase Agreement with respect to the offering of units in December 2022 in exchange for the issuance by the Company, on the closing date of such offering, of an additional number of Series A warrants to purchase shares of Common Stock (“Series A Warrants”) and an additional number of Series B warrants to purchase shares of Common Stock (“Series B Warrants”) equal to the quotient obtained by dividing $ 750,000 by the public offering price for the units sold in the offering (such Warrants, the “Waiver Warrants”).

WISA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Six Months Ended June 30, 2024 and 2023

Borrowings, continued

In connection with the public offering the Company consummated on December 1, 2022 (the “December 2022 Offering”), the Company issued 357 Series A Warrants and 357 Series B Warrants to the New Convertible Note Investor (See Note 6).

7 unchanged sentences

Pursuant to the Loan and Security Agreement, the Meriwether Hero Fund agreed to provide the Company with bridge financing in the form of a term loan in the original principal amount of $ 650,000 , which term loan will be senior in priority to the Company’s present and future indebtedness (“Meriwether Loan”).

The Meriwether Loan matures on November 7, 2023, subject to further extension.

In addition, the Company has the right to request additional funding under the Loan and Security Agreement.

WISA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2024 and 2023

Borrowings, continued

The Meriwether Loan was to mature on November 7, 2023, subject to further extension.

In addition, the Company had the right to request additional funding under the Loan and Security Agreement.

Borrowings under the Meriwether Loan bore interest at a rate per annum equal to 18 %.

On the maturity date, subject to any extension, the Company was obligated to make a payment equal to all unpaid principal and accrued interest.

Pursuant to Meriwether Loan, the Company shall pay to the Meriwether Hero Fund a fully earned, non-refundable, origination fee in the amount of$ 50,000 .

The Company shall also pay to the Meriwether Hero Fund a fully earned, non-refundable, exit fee in the amount of $ 50,000 due and payable on the maturity date.

Pursuant to Meriwether Loan, the Company was required to pay to the Meriwether Hero Fund a fully earned, non-refundable, origination fee in the amount of$ 50,000 .

The Company was also required to pay to the Meriwether Hero Fund a fully earned, non-refundable, exit fee in the amount of $ 50,000 due and payable on the maturity date.

The Meriwether Loan also provided that all present and future indebtedness and the obligations of the Company to the Meriwether Hero Fund shall be secured by a first priority security interest in all real and personal property collateral of the Company.

The Meriwether Loan contains customary representations, warranties and affirmative and negative covenants.

In addition, the Meriwether Loan contains customary events of default that entitle the Meriwether Hero Fund to cause the Company’s indebtedness under the Meriwether Loan to become immediately due and payable, and to exercise remedies against the Company and the collateral securing the term loan.

The Meriwether Loan contained customary representations, warranties and affirmative and negative covenants.

In addition, the Meriwether Loan contained customary events of default that entitle the Meriwether Hero Fund to cause the Company’s indebtedness under the Meriwether Loan to become immediately due and payable, and to exercise remedies against the Company and the collateral securing the term loan.

On October 10, 2023, the Meriwether Hero Fund, agreed to extend the Meriwether Loan maturity date from November 7, 2023 to December 7, 2023, for a fee of $ 20,000 .

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January 2024 Short-Term Loan Agreement

On January 19, 2024, the Company entered into promissory notes in the aggregate principal amount of $ 1,000,000 (the “January 2024 Promissory Notes”) and common stock purchase warrants to purchase up to an aggregate of 66,665 shares (the “January 2024 Warrant Shares”) of the Company’s common stock, at an initial exercise price of $ 22.23 per share with four accredited investors (each an “Investor” and together the “Investors”).

On January 19, 2024, the Company issued promissory notes in the aggregate principal amount of $ 1,000,000 (the “January 2024 Promissory Notes”) and common stock purchase warrants to purchase up to an aggregate of 66,665 shares (the “January 2024 Warrant Shares”) of the Company’s common stock, at an initial exercise price of $ 22.23 per share with four accredited investors (each an “Investor” and together the “Investors”).

In connection with the January 2024 Promissory Notes, the Company received gross proceeds of $ 600,000 , before fees and other expenses associated with the transaction.

WISA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Six Months Ended June 30, 2024 and 2023

Borrowings, continued

The January 2024 Promissory Note was to mature on the earlier to occur of:

(i) July 17, 2024 and (ii) the full or partial exercise of certain Series B Preferred Stock purchase warrants currently held by the Investor, issuable for at least 9,322 shares of the Company’s Series B Convertible Preferred Stock, par value $ 0.0001 per share (“Series B Preferred Stock”), upon such full or partial exercise.

The January 2024 Promissory Notes do not bear interest except upon the occurrence of an Event of Default (as defined in the January 2024 Promissory Notes).

The January 2024 Promissory Notes did not bear interest except upon the occurrence of an Event of Default (as defined in the January 2024 Promissory Notes).

The January 2024 Promissory Notes were not convertible into shares of Common Stock or Series B Preferred Stock.

Between the dates of January 26, 2024 and February 2, 2024, the January 2024 Promissory Notes were repaid in full following the exercise of certain of the Company’s Series B Preferred Stock purchase warrants for a total of 29,322 shares of Series B Preferred Stock.

The 2024 Promissory Notes were settled via the payment of $ 667,000 in cash and a $ 333,000 offset to the amount due by one of the investor from the exercise of 9,322 Series B Preferred Stock purchase warrants.

The 2024 Promissory Notes were settled via the payment of $ 667,000 in cash and a $ 333,000 offset to the amount due by one of the investors from the exercise of 9,322 Series B Preferred Stock purchase warrants.

In connection with the issuance of the January 2024 Warrant Shares (see Note 5 – Fair Value Measurements), the fair value of the warrants and the original issue discount for interest were recorded as debt discounts totaling $ 1,260,000 .

The debt discounts were to be amortized to interest expense over the respective term using the effective interest method.

In connection with the full repayment of the January 2024 Promissory Notes, the Company recognized $ 1,260,000 of interest expense in the three months ended March 31, 2024.

WISA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2024 and 2023

In connection with the full repayment of the January 2024 Promissory Notes, the Company recognized $ 1,260,000 of interest expense in the six months ended June 30, 2024.

Fair Value Measurements

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The determination of fair value for Level 3 instruments involves the most management judgment and subjectivity.

The Company’s financial assets and liabilities that are measured at fair value on a recurring basis as of March 31, 2024 and December 31, 2023 by level within the fair value hierarchy, are as follows:

The Company’s financial assets and liabilities that are measured at fair value on a recurring basis as of June 30, 2024 and December 31, 2023 by level within the fair value hierarchy, are as follows:

(in thousands)

March 31, 2024

June 30, 2024

Quoted prices

Warrant liabilities

WISA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Six Months Ended June 30, 2024 and 2023

Fair Value Measurements, continued

(in thousands)

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Warrant liabilities

There were no transfers between Level 1, 2 or 3 during the three months ended March 31, 2024 or 2023.

There were no transfers between Level 1, 2 or 3 during the three and six months ended June 30, 2024 or 2023.

Warrant Liabilities

The following table includes a summary of changes in fair value of the Company’s warrant liabilities measured at fair value using significant unobservable inputs (Level 3) as of March 31, 2024 and 2023.

For March 31, 2024, the fair value of the common warrants was determined using the Black-Scholes Model based on the following key inputs and assumptions:

For June 30, 2024, the fair value of the common warrants was determined using the Black-Scholes Model based on the following key inputs and assumptions:

common stock price of $ 2.57 ;

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expected volatility of 143 %;

risk-free interest rate between 4.21 % and 4.40 % and expected life between 3.4 and 5.0 years.

WISA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2024 and 2023

Fair Value Measurements, continued

For the three month ended March 31,

risk-free interest rate of 4.52 % and expected life between 3.1 and 3.6 years.

During the three months ended June 30, 2024, the Company amended the terms of certain warrant agreements to remove certain exercise price reset, right to reprice and/or share adjustment provisions (“Reset Provisions”) following a reverse split, in addition to other revisions to the warrants.

In April 2024, the Company effected the April 2024 Reverse Stock Split thereby removing the Reset Provisions (“Reset Amendment Effective Date”) and in accordance with provisions in certain of the warrants issued warrants to purchase an additional 5,602,693 shares of common stock.

Accordingly, the Company remeasured the warrant liability for each of the amended warrants following the Reset Amendment Effective Date and recorded that amount to change in fair value of warrant liabilities with a corresponding increase to warrant liabilities.

Following the Reset Amendment Effective Date, such warrants were no longer deemed to be liability warrants but were now classified as equity warrants.

In connection with this reclassification the Company reclassed approximately $ 41.9 million from warrant liabilities to additional paid in capital.

For the six months ended June 30,

(in thousands)

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Exercise of warrant liabilities

Conversion of liability warrants to equity warrants

Ending balance

The changes in fair value of the warrant liabilities are recorded in change in fair value of warrant liabilities in the condensed consolidated statements of operations.

WISA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Six Months Ended June 30, 2024 and 2023

Convertible Redeemable Preferred Stock and Stockholders’ Equity

Series B Preferred Stock, Series B Preferred Stock Warrants

On October 16, 2023, the Company consummated a public offering (the “October Public Offering”) for an aggregate of 87,000 Series B Units (“Series B Units”).

On October 16, 2023, the Company consummated a public offering for an aggregate of 87,000 Series B Units (“Series B Units”).

Each Series B Unit consists of one share of the Company’s Series B Preferred Stock and two warrants, each to purchase one share of Series B Preferred Stock (“Series B Preferred Stock Warrant”).

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Exercise of Series B Preferred Stock Warrants

On December 6, 2023, the Company executed an Inducement Agreement (the “Inducement Agreement”) with the holders of Series B Preferred Stock Warrants, modifying the exercise price to $ 35.72 per warrant.

Any holder that exercises Series B Preferred Stock Warrants under the Inducement Agreement received a new Common Stock Warrant (“New Common Stock Warrants”) for each Series B Preferred Stock Warrant exercised.

Each New Common Stock Warrant entitles the holder to purchase 2 shares of Common Stock at an initial exercise price of $ 22.23 per New Common Stock Warrant.

On December 5, 2023, the Company executed an Inducement Agreement (the “Inducement Agreement”) with the holders of Series B Preferred Stock Warrants, reducing the exercise price to $ 35.72 per share of Series B Preferred Stock.

Any holder that exercised Series B Preferred Stock Warrants under the Inducement Agreement received a new Common Stock Warrant (“New Common Stock Warrants”) for each Series B Preferred Stock Warrant exercised.

Each New Common Stock Warrant entitles the holder to purchase 2 shares of common stock at an initial exercise price of $ 22.23 per share.

Due to certain price protections included with the New Common Stock Warrants, the warrants did not meet the criteria for equity classification and thus are subject to liability treatment.

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All 61,613 New Common Stock Warrants issued as a result of the exercise of Series B Preferred Stock Warrants were outstanding as of December 31, 2023.

Issuance costs of $ 429,000 and $ 125,000 were expensed on the date of issuance of the Series B Preferred Stock Warrants and the New Common Stock Warrants, respectively as such warrants were recorded at fair value.

Total issuance costs expensed from the issuances were charged to Change in fair value of warrant liabilities and amounted to $ 554,000 .

WISA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2024 and 2023

For the Three and Six Months Ended June 30, 2024 and 2023

Convertible Redeemable Preferred Stock and Stockholders’ Equity, continued

Total issuance costs expensed from the issuances were charged to Change in fair value of warrant liabilities and amounted to $ 554,000 .

Through various dates from issuance to December 31, 2023, the holders of 110,278 shares of Series B Preferred Stock converted their shares into 177,282 shares of Common Stock.

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The 38,335 shares of Series B Preferred Stock outstanding as of December 31, 2023, were to become mandatorily redeemable on October 15, 2025 in the amount of $ 3,833,500 .

Through various dates during the three months ended March 31, 2024, holders of Series B Preferred Stock warrants exercised their warrants into 29,332 shares of Series B Preferred Stock at an exercise price of $ 35.72 per warrant.

Through various dates during the six months ended June 30, 2024, holders of Series B Preferred Stock Warrants exercised their warrants into 29,332 shares of Series B Preferred Stock at an exercise price of $ 35.72 per share.

For each exercised Series B Preferred Stock Warrant, the holder received one share of Series B Preferred Stock and one New Common Stock Warrant.

Each New Common Stock Warrant entitles the holder to purchase 2 shares of Common Stock at an initial exercise price of $ 22.23 per New Common Stock Warrant.

Each New Common Stock Warrant entitles the holder to purchase 2 shares of Common Stock at an initial exercise price of $ 22.23 per share.

Due to certain price protections included with the New Common Stock Warrants, the warrants did not meet the criteria for equity classification and thus are subject to liability treatment.

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Conversion of Series B Preferred Stock

Through various dates during the three months ended March 31, 2024, the holders of 5,000 shares of Series B Preferred Stock converted their shares into 8,038 shares of Common Stock.

Through various dates during the six months ended June 30, 2024, the holders of 5,000 shares of Series B Preferred Stock converted their shares into 8,038 shares of Common Stock.

Unamortized discounts to the Series B Preferred Stock of $ 269,000 were immediately recorded as a deemed dividend as of conversion date.

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Other Deemed Dividends

Amortization and accretion of discounts for all Series B Preferred Stock during the three months ended March 31, 2024 amounted to $ 192,000 , which were also recorded as a deemed dividend to the holders of Series B Preferred Stock.

Amortization and accretion of discounts for all Series B Preferred Stock during the six months ended June 30, 2024 amounted to $ 192,000 , which were also recorded as a deemed dividend to the holders of Series B Preferred Stock.

The total of deemed dividends (as discussed in this section, the Conversion of Series B Preferred Stock and February 2024 Series B Preferred Stock and Series B Preferred Stock Warrants Repurchase sections above) amounted to $ 5,842,000 for the six months ended June 30, 2024 and was recorded as an adjustment to net loss available to common stockholders on the Company’s condensed consolidated statement of operations.

WISA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2024 and 2023

For the Three and Six Months Ended June 30, 2024 and 2023

Convertible Redeemable Preferred Stock and Stockholders’ Equity, continued

The total of deemed dividends (as discussed in this section, the Conversion of Series B Preferred Stock and February 2024 Series B Preferred Stock and Series B Preferred Stock Warrants Repurchase sections above) amounted to $ 5,842,000 for the three months ended March 31, 2024 and was recorded as an adjustment to net loss available to common stockholders on the Company’s condensed consolidated statement of operations.

2018 Long Term Stock Incentive Plan

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At a Special Meeting of Stockholders on March 15, 2024, the Company’s stockholders further approved an amendment to the LTIP to increase the annual share limit of Common Stock that may be issued only for the 2024 fiscal year under the LTIP from 8 % of the shares of Common Stock outstanding to 15 % of the shares of Common Stock outstanding (which amount equates to the maximum amount that may be issued in the aggregate under the LTIP).

As of March 31, 2024, up to 263,570 shares of common stock are available for participants under the LTIP.

A summary of activity related to restricted stock awards for the three months ended March 31, 2024 is presented below:

As of June 30, 2024, up to 477,774 shares of common stock are available for grants to participants under the LTIP.

A summary of activity related to restricted stock awards for the six months ended June 30, 2024 is presented below:

Weighted-Average

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Non-vested as of January 1, 2024

Non-vested as of March 31, 2024

As of March 31, 2024, the unamortized compensation costs related to the unvested restricted stock awards was approximately $ 1,138,000 which is to be amortized on a straight-line basis over a weighted-average period of approximately 0.7 years.

For the three months ended March 31, 2024, 20 shares of restricted stock units were released under the LTIP with an intrinsic value of less than $ 1,000 .

For the three months ended March 31, 2023, no shares of restricted stock issued under the LTIP, were released.

Non-vested as of June 30, 2024

As of June 30, 2024, the unamortized compensation costs related to the unvested restricted stock awards was approximately $ 1,620,000 which is to be amortized on a straight-line basis over a weighted-average period of approximately 2 years.

For the six months ended June 30, 2024, 774 shares of common stock were issued upon vesting of outstanding restricted stock, pursuant to the LTIP with an intrinsic value of less than $ 2,000 .

For the six months ended June 30, 2023, 24 shares of common stock were issued upon vesting of outstanding restricted stock, pursuant to the LTIP with an intrinsic value of less than $ 5,000 .

WISA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2024 and 2023

For the Three and Six Months Ended June 30, 2024 and 2023

Convertible Redeemable Preferred Stock and Stockholders’ Equity, continued

2020 Stock Incentive Plan

A summary of activity related to restricted stock units under the Company’s 2020 Stock Incentive Plan for the three months ended March 31, 2024 is presented below:

A summary June 30, 2024 is presented below:

Weighted-Average

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Non-vested as of January 1, 2024

Non-vested as of March 31, 2024

As of March 31, 2024, there was no unamortized compensation costs.

For the three months ended March 31, 2024, 1 share of restricted stock units was released under the 2020 Stock Incentive Plan with an intrinsic value of less than $ 1,000 .

For the three months ended March 31, 2023, no shares of restricted stock, issued under the 2020 Stock Incentive Plan, were released.

Non-vested as of June 30, 2024

As of June 30, 2024, there was no unamortized compensation costs.

For the six months ended June 30, 2024, 1 share of common stock was issued upon vesting of outstanding restricted stock units pursuant to the 2020 Stock Incentive Plan with an intrinsic value of less than $ 1,000 .

For the six months ended June 30, 2023, no shares of common stock, issued under the 2020 Stock Incentive Plan, were released.

Inducement Grant

On September 13, 2021, the Company issued 21 shares of restricted common stock to Eric Almgren, the Company’s Chief Strategist, as an inducement grant (“September 2021 Inducement Grant”).

As of March 31, 2024, the unamortized compensation cost related to the unvested September 2021 Inducement Grant was approximately $ 121,000 which is being amortized on a straight-line basis over a period of approximately 0.5 years.

The Company recorded stock-based compensation of $ 64,000 related to this grant for three months ended March 31, 2024.

As of March 31, 2024, 16 shares are unvested.

For the three months ended March 31, 2024, no shares of restricted stock were released under the September 2021 Inducement Grant.

A summary of activity related to restricted stock units under the Company’s Technical Team Retention Plan of 2022 (the “2022 Plan”) for the three months ended March 31, 2024 is presented below:

As of June 30, 2024, the unamortized compensation cost related to the unvested September 2021 Inducement Grant was approximately $ 57,000 which is being amortized on a straight-line basis over a period of approximately 0.2 years.

The Company recorded stock-based compensation of $ 64,000 and $ 128,000 related to this grant for three and six months ended June 30, 2024.

As of June 30, 2024, 16 shares are unvested.

For the six months ended June 30, 2024, no shares of restricted stock were released under the September 2021 Inducement Grant.

A summary of activity related to restricted stock units under the Company’s Technical Team Retention Plan of 2022 (the “2022 Plan”) for the six months ended June 30, 2024 is presented below:

Weighted-Average

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Non-vested as of January 1, 2024

Non-vested as of March 31, 2024

As of March 31, 2024, the unamortized compensation cost related to the unvested restricted stock units was approximately $ 106,000 which is to be amortized on a straight-line basis over a weighted-average period of approximately 2.2 years.

For the three months ended March 31, 2024, 3 shares of restricted stock units were released under the 2022 Plan with an intrinsic value of less than $ 1,000 .

For the three months ended March 31, 2023, no shares of restricted stock units were released under the 2022 Plan.

Non-vested as of June 30, 2024

As of June 30, 2024, the unamortized compensation cost related to the unvested restricted stock units was approximately $ 94,000 which is to be amortized on a straight-line basis over a weighted-average period of approximately 2 years.

For the six months ended June 30, 2024, 3 shares of common stock were issued upon vesting of outstanding restricted stock units pursuant to the 2022 Plan with an intrinsic value of less than $ 1,000 .

For the six months ended June 30, 2023, no shares of common stock, issued under the 2022 Plan, were released.

WISA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2024 and 2023

For the Three and Six Months Ended June 30, 2024 and 2023

Convertible Redeemable Preferred Stock and Stockholders’ Equity, continued

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Also, in connection with the February 2023 Offering, on January 31, 2023, the Company entered into a placement agency agreement with Maxim, pursuant to which Maxim agreed to act as placement agent on a “best efforts” basis in connection with the offering and (ii) the Company agreed to pay Maxim an aggregate fee equal to 8.0 % of the gross proceeds raised in the offering.

Also in connection with the February 2023 Offering, the Company entered into an amendment (the “Amendment”) to the securities purchase agreement, dated as of November 29, 2022, by and between the Company and certain institutional investors (the “November Purchase Agreement”) approved by a certain investor (the “November Investor”) who purchased at least 50.1 % in interest of the shares of Common Stock and the pre-funded warrants to purchase shares of Common Stock, if any, based on the initial subscription amounts under the November Purchase Agreement, pursuant to Section 5.5 of the November Purchase Agreement.

Pursuant to the Amendment, Section 4.11 of the November Purchase Agreement, which prohibits the Company’s ability to issue shares of Common Stock or Common Stock Equivalents (as defined in the November Purchase Agreement) or filing any registration statement or amendment or supplement thereto under the Securities Act, until ninety (90) days after the closing date of the transactions contemplated by the November Purchase Agreement, was amended to permit the offering discussed above and the issuance and sale of the securities offered and sold in such offering.

March 2023 Offering

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On April 12, 2023, the Company closed the April 2023 Offering and received net proceeds of approximately $ 1.0 million, after deducting fees payable to the financial advisor and other offering expenses.

WISA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2024 and 2023

Convertible Redeemable Preferred Stock and Stockholders’ Equity, continued

October 2023 Warrant Repurchase

1 unchanged sentence

The repurchased warrants were previously classified as equity warrants and at the date of repurchase a charge was recorded to additional paid-in capital.

WISA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Six Months Ended June 30, 2024 and 2023

Convertible Redeemable Preferred Stock and Stockholders’ Equity, continued

February 2024 Issuance of Common Stock and Pre-Funded Common Stock Warrants

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Each February Pre-Funded Unit was issued at $ 9.735 per unit and included one pre-funded common stock warrant (the “February Pre-Funded Warrants”), exercisable for one share of common stock at an initial exercise price of $ 0.015 and one February Common Warrant.

The gross proceeds from the issuance of the February Units and the February Pre-Funded Units was $ 1,543,000 and $ 8,444,000 , respectively, for total aggregate proceeds of $ 9,987,000 before broker fees and related expenses of approximately $ 998,000 .

The gross proceeds from the issuance of the February Units and the February Pre-Funded Units were $ 1,543,000 and $ 8,444,000 , respectively, for total aggregate proceeds of $ 9,987,000 before broker fees and related expenses of approximately $ 998,000 .

As a result of certain price protection clauses, the February Common Warrants did not meet the criteria for equity classification and thus are subject to liability treatment.

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The remaining issuance cost of $ 207,000 was allocated to the March Common Warrants and was expensed on the date of issuance as such warrants were recorded at fair value.

Warrants for Shares of Common Stock

A summary of the warrant activity and related information for the three months ended March 31, 2024 and the year ended 2023 is provided as follows.

April 2024 Issuances of Common Stock and Common Stock Warrants

On April 17, 2024, the Company entered into a securities purchase agreement with certain accredited investors, pursuant to which the Company agreed to issue and sell to such investors (i) in a registered direct offering, 225,834 shares of common stock at $ 3.321 per share, and (ii) in a concurrent private placement, common stock purchase warrants exercisable for an aggregate of up to 225,834 shares of common stock, at an initial exercise price of $ 3.196 per share (the “Initial April 2024 Registered Direct Offering and Concurrent Private Placement”).

The Initial 2024 Registered Direct Offering and Concurrent Private Placement closed on April 19, 2024 and the Company received gross proceeds of approximately $ 750,000 before deducting placement agent fees and other offering expenses of approximately $ 159,000 .

WISA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2024 and 2023

For the Three and Six Months Ended June 30, 2024 and 2023

Convertible Redeemable Preferred Stock and Stockholders’ Equity, continued

On April 19, 2024, the Company entered into a securities purchase agreement with certain accredited investors, pursuant to which the Company agreed to issue and sell to such investors (i) in a registered direct offering, 361,904 shares of common stock at $ 5.25 per share, and (ii) in a concurrent private placement, common stock purchase warrants exercisable for an aggregate of up to 542,856 shares of common stock, at an initial exercise price of $ 5.06 per share (the “Second April 2024 Registered Direct Offering and Concurrent Private Placement”).

The Second 2024 Registered Direct Offering and Concurrent Private Placement closed on April 23, 2024 and the Company received gross proceeds of approximately $ 1.9 million before deducting placement agent fees and other offering expenses of approximately $ 268,000 .

On April 26, 2024, the Company entered into a securities purchase agreement with certain accredited investors, pursuant to which the Company agreed to issue and sell to such investors (i) in a registered direct offering, 418,845 shares of common stock at $ 5.73 per share, and (ii) in a concurrent private placement, common stock purchase warrants exercisable for an aggregate of up to 418,845 shares of common stock, at an initial exercise price of $ 5.60 per share (the “Third April 2024 Registered Direct Offering and Concurrent Private Placement”).

The Third 2024 Registered Direct Offering and Concurrent Private Placement closed on April 30, 2024 and the Company received gross proceeds of approximately $ 2.4 million before deducting placement agent fees and other offering expenses of approximately $ 298,000 .

May 2024 Issuances of Common Stock and Common Stock Warrants

On May 13, 2024, the Company entered into a securities purchase agreement with certain accredited investors, pursuant to which the Company agreed to issue and sell to such investors (i) in a registered direct offering, 785,000 shares of common stock at $ 3.31 per share, and (ii) in a concurrent private placement, common stock purchase warrants exercisable for an aggregate of up to 785,000 shares of common stock, at an initial exercise price of $ 3.18 per share (the “Initial May 2024 Registered Direct Offering and Concurrent Private Placement”).

The Initial May 2024 Registered Direct Offering and Concurrent Private Placement closed on May 15, 2024 and the Company received gross proceeds of approximately $ 2.6 million before deducting placement agent fees and other offering expenses of approximately $ 314,000 .

On May 15, 2024, the Company entered into a securities purchase agreement with certain accredited investors, pursuant to which the Company agreed to issue and sell to such investors (i) in a registered direct offering, 675,000 shares of common stock at $ 3.61 per share, and (ii) in a concurrent private placement, common stock purchase warrants exercisable for an aggregate of up to 675,000 shares of common stock, at an initial exercise price of $ 3.48 per share (the “Second May 2024 Registered Direct Offering and Concurrent Private Placement”).

The Second May 2024 Registered Direct Offering and Concurrent Private Placement closed on May 17, 2024 and the Company received gross proceeds of approximately $ 2.4 million before deducting placement agent fees and other offering expenses of approximately $ 290,000 .

For the three months ended June 30, 2024, the Company’s board of directors approved the issuance of a total of 136,203 shares of common stock to two vendors for investor relations services.

The fair value of such common shares was calculated to be $ 360,000 and was recorded to other assets and additional paid in capital.

The fair value of such shares will be amortized over the service period of each agreement which ranged from 6 months to 12 months .

The shares of common stock will be issued in July 2024.

Warrants for Shares of Common Stock

A summary of the warrant activity and related information for the six months ended June 30, 2024 and the year ended 2023 is provided as follows.

In connection with February 2023 Offering, the Company issued common stock purchase warrants to investors to purchase up to 5,833 shares of the Company’s common stock, at an initial exercise price of $ 1,573.50 per share.

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risk-free interest rate of 3.67 % and expected life of 5 years.

WISA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Six Months Ended June 30, 2024 and 2023

Convertible Redeemable Preferred Stock and Stockholders’ Equity, continued

In connection with March 2023 Offering, the Company issued common stock purchase warrants to investors to purchase up to 11,163 shares of the Company’s common stock, at an initial exercise price of $ 286.50 per share.

6 unchanged sentences

May 2023 Warrant Inducement

On May 15, 2023, the Company entered into warrant exercise inducement offer letters (the “May Inducement Letters”) with the holders of common stock purchase warrants exercisable for an aggregate of up to 9,907 shares of common stock at an initial exercise price of $ 211.50 per share issued on April 12, 2023 (the “April Warrants”).

On May 15, 2023, the Company entered into warrant exercise inducement offer letters with the holders of common stock purchase warrants exercisable for an aggregate of up to 9,907 shares of common stock at an initial exercise price of $ 211.50 per share issued on April 12, 2023 (the “April Warrants”).

The April Warrant holders agreed to exercise for cash April Warrants to purchase up to 9,907 shares of common stock in exchange for the Company’s agreement to issue 19,815 new warrants (the “May Inducement Warrants”) on substantially the same terms as the April Warrants.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2024 and 2023

For the Three and Six Months Ended June 30, 2024 and 2023

Convertible Redeemable Preferred Stock and Stockholders’ Equity, continued

4 unchanged sentences

In addition, during the three months ended March 31, 2023, 7,454 warrants were exercised using an alternative cashless exercise provision, resulting in the issuance 5,705 shares of common stock.

In connection with January 2024 Promissory Notes, the Company issued common stock purchase warrants to investors to purchase up to 66,665 shares of the Company’s common stock, at an initial exercise price of $ 22.23 per share.

In connection with the January 2024 Promissory Notes, the Company issued common stock purchase warrants to investors to purchase up to 66,665 shares of the Company’s common stock, at an initial exercise price of $ 22.23 per share.

The grant date fair value of such warrant was $ 860,000 , which was recorded as a liability with the offset recorded to additional paid-in capital on the condensed consolidated balance sheets.

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and (ii) remove certain exercise price reset, right to reprice and/or share adjustment provisions in the Original Warrants, to be effective following the first adjustments following the April 2024 Reverse Stock Split.

During the three months ended March 31, 2024, and excluding the exercise of pre-funded warrants, no warrants to purchase common stock were exercised for cash or using the alternative cashless exercise provision.

In connection with the Initial April 2024 Registered Direct Offering and Concurrent Private Placement, the Company issued Common Stock Purchase Warrants to investors to purchase up to 225,834 shares of the Company’s common stock, at an initial exercise price of $ 3.196 per share.

The grant date fair value of such warrant was $ 1,255,000 , which was recorded as equity.

The fair value of such warrants was determined using the Black-Scholes Model based on the following weighted average assumption:

common stock price on the date of grant of $ 6.06 ;

expected yield of 0.0 %;

expected volatility of 135 %;

risk-free interest rate of 4.63 % and expected life of 5 years.

WISA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2024 and 2023

For the Three and Six Months Ended June 30, 2024 and 2023

Convertible Redeemable Preferred Stock and Stockholders’ Equity, continued

Information regarding warrants for common stock outstanding and exercisable as of March 31, 2024 is as follows:

In connection with the Second April 2024 Registered Direct Offering and Concurrent Private Placement, the Company issued Common Stock Purchase Warrants to investors to purchase up to 542,856 shares of the Company’s common stock, at an initial exercise price of $ 5.06 per share.

The grant date fair value of such warrant was $ 2,595,000 , which was recorded as equity.

The fair value of such warrants was determined using the Black-Scholes Model based on the following weighted average assumption:

common stock price on the date of grant of $ 5.39 ;

expected yield of 0.0 %;

expected volatility of 135 %;

risk-free interest rate of 4.63 % and expected life of 5 years.

In connection with the Third April 2024 Registered Direct Offering and Concurrent Private Placement, the Company issued Common Stock Purchase Warrants to investors to purchase up to 418,845 shares of the Company’s common stock, at an initial exercise price of $ 5.60 per share.

The grant date fair value of such warrant was $ 2,048,000 , which was recorded as equity.

The fair value of such warrants was determined using the Black-Scholes Model based on the following weighted average assumption:

common stock price on the date of grant of $ 5.54 ;

expected yield of 0.0 %;

expected volatility of 135 %;

risk-free interest rate of 4.63 % and expected life of 5 years.

In connection with the Initial May 2024 Registered Direct Offering and Concurrent Private Placement, the Company issued Common Stock Purchase Warrants to investors to purchase up to 785,000 shares of the Company’s common stock, at an initial exercise price of $ 3.18 per share.

The grant date fair value of such warrant was $ 2,453,000 , which was recorded as equity.

The fair value of such warrants was determined using the Black-Scholes Model based on the following weighted average assumption:

common stock price on the date of grant of $ 3.50 ;

expected yield of 0.0 %;

expected volatility of 137 %;

risk-free interest rate of 4.35 % and expected life of 5 years.

In connection with the Second May 2024 Registered Direct Offering and Concurrent Private Placement, the Company issued Common Stock Purchase Warrants to investors to purchase up to 675,000 shares of the Company’s common stock, at an initial exercise price of $ 3.48 per share.

The grant date fair value of such warrant was $ 1,944,000 , which was recorded as equity.

The fair value of such warrants was determined using the Black-Scholes Model based on the following weighted average assumption:

common stock price on the date of grant of $ 3.26 ;

expected yield of 0 %;

expected volatility of 137 %;

risk-free interest rate of 4.35 % and expected life of 5 years.

During the three months ended June 30, 2024, 438,611 warrants, including pre-funded warrants, to purchase common stock were exercised for cash, resulting in net proceeds of approximately $ 556,000 .

In addition, during the three months ended June 30, 2024, 3,225 warrants were exercised using an alternative cashless exercise provision, resulting in the issuance 3,211 shares of common stock.

During the three months ended June 30, 2023, 1,486,132 warrants to purchase common stock were exercised for cash, resulting in net proceeds of approximately $ 1,895,000 .

In addition, during the three months ended June 30, 2023, 17,143 warrants were exercised using an alternative cashless exercise provision, resulting in the issuance 12,856 shares of common stock.

Information regarding warrants for common stock outstanding and exercisable as of June 30, 2024 is as follows:

Weighted Average

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Exercisable as of

March 31, 2024

June 30, 2024

$ 0.015 - $ 3.48

$ 5.06 - $ 6.00

$ 22,800 - $ 393,000

* Weighted average

Warrants exercisable as of March 31, 2024 exclude warrants to purchase 1 share of common stock issued to a marketing firm, which vest upon the achievement of certain milestones and warrants to purchase 1,536,775 shares of common stock issued to investors that participated in the February Public Offering and March 2024 Offering that requires shareholder approval prior to the warrants being exercisable.

WISA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Six Months Ended June 30, 2024 and 2023

Convertible Redeemable Preferred Stock and Stockholders’ Equity, continued

Warrants exercisable as of June 30, 2024 exclude warrants to purchase 7,139,469 shares of common stock issued to investors that participated in the February Public Offering and March 2024 Offering that require shareholder approval prior to the warrants being exercisable.

Information regarding warrants for common stock outstanding and exercisable as of December 31, 2023 is as follows:

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Warrants exercisable as of December 31, 2023 exclude warrants to purchase 1 shares of common stock issued to a marketing firm, which vest upon the achievement of certain milestones and warrants to purchase 187,557 shares of common stock issued to investors that participated in the Inducement Agreement that requires shareholder approval prior to the warrants being exercisable.

The Company recorded no provision for income taxes for the three months ended March 31, 2024 and 2023.

The Company’s effective tax rate was 0.0 % for the three months ended March 31, 2024 and 2023.

The difference between the effective tax rate and the federal statutory tax rate for the three months ended March 31, 2024 and 2023 primarily relates to the valuation allowance on the Company’s deferred tax assets.

The Company recorded no provision for income taxes for the three and six months ended June 30, 2024.

The Company recorded a provision for income taxes of $ 2,000 and $ 2,000 for the three and six months ended June 30, 2023, respectively.

The Company’s effective tax rate was 0.0 % for the three and six months ended June 30, 2024 and 2023.

The difference between the effective tax rate and the federal statutory tax rate for the three and six months ended June 30, 2024 and 2023 primarily relates to the valuation allowance on the Company’s deferred tax assets.

For interim periods, the Company estimates its annual effective income tax rate and applies the estimated rate to the year-to-date income or loss before income taxes.

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The Company also recognizes the effect of changes in enacted tax laws or rates in the interim periods in which the changes occur.

WISA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2024 and 2023

Income Taxes, continued

As of March 31, 2024 and December 31, 2023, the Company retains a full valuation allowance on its deferred tax assets.

As of June 30, 2024 and December 31, 2023, the Company retains a full valuation allowance on its deferred tax assets.

The realization of the Company’s deferred tax assets depends primarily on its ability to generate taxable income in future periods.

The amount of deferred tax assets considered realizable in future periods may change as management continues to reassess the underlying factors it uses in estimating future taxable income.

The provision for income taxes for the three months ended March 31, 2024 and 2023 was calculated on a jurisdiction basis.

The provision for income taxes for the three and six months ended June 30, 2024 and 2023 was calculated on a jurisdiction basis.

WISA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Six Months Ended June 30, 2024 and 2023

Commitments and Contingencies

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we recognize lease expense for these leases on a straight-line basis over the lease term.

The following table reflects our lease assets and our lease liabilities at March 31, 2024 and December 31, 2023 (in thousands):

The following table reflects our lease assets and our lease liabilities at June 30, 2024 and December 31, 2023 (in thousands):

Operating lease right-of-use assets

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The components of lease costs were as follows (in thousands):

March 31, 2024

Three Months Ended

Six Months Ended

June 30, 2024

Operating lease cost

1 unchanged sentence

Total lease cost

WISA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2024 and 2023

Commitments and Contingencies, continued

As of March 31, 2024, the maturity of operating lease liabilities was as follows (in thousands):

As of June 30, 2024, the maturity of operating lease liabilities was as follows (in thousands):

Payments due in:

7 unchanged sentences

Present value of capital lease obligations

WISA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Six Months Ended June 30, 2024 and 2023

Commitments and Contingencies, continued

Lease Term and Discount Rate:

March 31, 2024

June 30, 2024

Weighted-average remaining lease term (in years)

4 unchanged sentences

Three Months Ended

March 31, 2024

Six Months Ended

June 30, 2024

Operating cash outflows from operating leases

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Kristensen serves as vice president of Hansong Technology, an original device manufacturer of audio products based in China, president of Platin Gate Aps, a company with focus on service-branding in lifestyle products as well as pro line products based in Denmark and co-founder and director of Inizio Capital, an investment company based in the Cayman Islands.

For the three months ended June 30, 2024 and 2023, Hansong Technology purchased modules from the Company of approximately $ 10,000 and $ 24,000 , respectively, and made payments to the Company of approximately $ 0 and $ 189,000 , respectively.

At June 30, 2024 and 2023, Hansong Technology owed the Company approximately $ 39,000 and $ 29,000 , respectively.

For the three months ended June 30, 2024 and 2023, Hansong Technology sold speaker products to the Company of approximately $ 1,000 and $ 21,000 , respectively, and the Company made payments to Hansong Technology of approximately $ 63,000 and $ 794,000 respectively.

At June 30, 2024 and 2023, the Company owed Hansong Technology approximately $ 163,000 and $ 350,000 , respectively.

For the six months ended June 30, 2024 and 2023, Hansong Technology purchased modules from the Company of approximately $ 35,000 and $ 48,000 , respectively, and made payments to the Company of approximately $ 0 and $ 189,000 , respectively.

For the six months ended June 30, 2024 and 2023, Hansong Technology sold speaker products to the Company of approximately $ 1,000 and $ 59,000 , respectively, and the Company made payments to Hansong Technology of approximately $ 88,000 and $ 1,053,000 , respectively.

WISA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2024 and 2023

For the Three and Six Months Ended June 30, 2024 and 2023

Related Parties, continued

For the three months ended March 31, 2024 and 2023, Hansong Technology purchased modules from the Company of approximately $ 25,000 and $ 24,000 , respectively, and made no payments to the Company during those same periods.

At March 31, 2024 and 2023, Hansong Technology owed the Company approximately $ 29,000 and $ 190,000 , respectively.

For the three months ended March 31, 2024 and 2023, Hansong Technology sold speaker products to the Company of approximately $ 0 and $ 36,000 , respectively, and the Company made payments to Hansong Technology of approximately $ 25,000 and $ 256,000 respectively.

At March 31, 2024 and 2023, the Company owed Hansong Technology approximately $ 225,000 and $ 1,118,000 , respectively.

As of March 31, 2024 and December 31, 2023, Mr.

As of June 30, 2024 and December 31, 2023, Mr.

Kristensen owned less than 1.0 % of the outstanding shares of the Company’s common stock.

1 unchanged sentence

Howitt is founder and CEO of Meriwether Group LLC, (“Meriwether”), a strategic consulting firm that works with disruptive consumer brands by integrating their visions, developing growth strategies, scaling their brands, and increasing revenue in order to build enterprise value.

Meriwether is the manager of Meriwether Accelerators LLC (“Meriwether Accelerators”).

Meriwether is the manager of Meriwether Accelerators LLC.

Meriwether which is also majority-owned by Mr.

Howitt, owns a 25 % general partner interest in Meriwether Group Capital Hero Fund LP (“Meriwether Hero Fund”).

Howitt, owns a 25 % general partner interest in Meriwether Hero Fund.

On September 8, 2023, the Company entered into a Loan and Security Agreement with Meriwether Hero Fund.

2 unchanged sentences

See Note 4 Short-Term Loan for additional information.

As of March 31, 2024 and December 31, 2023, Mr.

As of June 30, 2024 and December 31, 2023, Mr.

Howitt owned less than 1.0 % of the outstanding shares of the Company’s common stock.

WISA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2024 and 2023

Segment Information

2 unchanged sentences

Net revenue from customers is designated based on the geographic region to which the product is delivered.

Net revenue by geographic region for the three months ended March 31, 2024 and 2023 was as follows:

Net revenue by geographic region for the three and six months ended June 30, 2024 and 2023 was as follows:

For the Three Months Ended

For the Six Months Ended

(in thousands)

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Substantially all of our long-lived assets are located in the United States.

Subsequent Events

April 2024 Reverse Stock Split

On April 4, 2024, the Board approved the April 2024 Reverse Stock Split and authorized the filing of the Certificate of Amendment to effect such reverse stock split, which was effected on April 12, 2024.

Share Combination Event Adjustment for Certain Warrants

In connection with the April 2024 Reverse Stock Split and pursuant to the share combination event adjustment provisions of certain of the Company’s outstanding warrants, on April 22, 2024, (a) the aggregate number of shares of common stock underlying such warrants increased from an aggregate of up to 1,536,775 to an aggregate of up to 7,139,468 , and (b) the exercise price of such warrants was downward adjusted to $ 1.8302 per share.

Such shares will become exercisable upon receipt of stockholder approval for the issuance of such shares.

Nasdaq Decision and Partial Compliance Letter

On April 5, 2024, the Panel issued the April 2024 Decision granting the Company’s request for continued listing on the Nasdaq Capital Market, subject to the Company regaining compliance with certain requirements.

On April 29, 2024, the Company received the April 29 Letter from Nasdaq notifying the Company that it has regained compliance with the Minimum Bid Price Requirement, as required by the April 2024 Decision.

See Note 1 under the heading “Nasdaq Compliance.”

Initial April 2024 Registered Direct Offering and Concurrent Private Placement

On April 17, 2024, the Company entered into a securities purchase agreement with certain accredited investors, pursuant to which the Company agreed to issue and sell to such investors (i) in a registered direct offering, 225,834 shares of common stock at $ 3.321 per share, and (ii) in a concurrent private placement, common stock purchase warrants (the “Initial April 2024 Warrants”) exercisable for an aggregate of up to 225,834 shares of common stock, at an initial exercise price of $ 3.196 per share (the “Initial April 2024 Registered Direct Offering and Concurrent Private Placement”).

The Initial April 2024 Warrants contain 4.99 / 9.99 % beneficial ownership limitations, are exercisable upon issuance and expire on the fifth anniversary of the issuance date of such warrants.

Issuance of shares of common stock upon “alternative cashless exercise” pursuant to the terms of such warrants is subject to stockholder approval.

WISA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2024 and 2023

Subsequent Event, continued

On or about April 19, 2024, the investors in the Initial 2024 Registered Direct Offering and Concurrent Private Placement each entered into a warrant amendment agreement with the Company whereby such investors agreed to amend the “alternative cashless exercise” provision in Section 2(c) of the Initial April 2024 Warrants such that issuance of shares of common stock upon exercise of such “alternative cashless exercise” is subject to stockholder approval.

Second April 2024 Registered Direct Offering and Concurrent Private Placement

On April 19, 2024, the Company entered into a securities purchase agreement with certain accredited investors, pursuant to which the Company agreed to issue and sell to such investors (i) in a registered direct offering, 361,904 shares of common stock at $ 5.25 per share, and (ii) in a concurrent private placement, common stock purchase warrants (the “Second April 2024 Warrants”) exercisable for an aggregate of up to 542,856 shares of common stock, at an initial exercise price of $ 5.06 per share (the “Second April 2024 Registered Direct Offering and Concurrent Private Placement”).

The Second April 2024 Warrants contain 4.99 / 9.99 % beneficial ownership limitations, are exercisable upon issuance and expire on the fifth anniversary of the issuance date of such warrants.

Issuance of shares of common stock upon “alternative cashless exercise” pursuant to the terms of such warrants is subject to stockholder approval.

Third April 2024 Registered Direct Offering and Concurrent Private Placement

On April 26, 2024, the Company entered into a securities purchase agreement with certain accredited investors, pursuant to which the Company agreed to issue and sell to such investors (i) in a registered direct offering, 418,845 shares of common stock at $ 5.73 per share, and (ii) in a concurrent private placement, common stock purchase warrants (the “Third April 2024 Warrants”) exercisable for an aggregate of up to 418,845 shares of common stock, at an initial exercise price of $ 5.60 per share (the “Third April 2024 Registered Direct Offering and Concurrent Private Placement”).

The Third April 2024 Warrants contain 4.99 / 9.99 % beneficial ownership limitations, are exercisable upon issuance and expire on the fifth anniversary of the issuance date of such warrants.

Issuance of shares of common stock upon “alternative cashless exercise” pursuant to the terms of such warrants is subject to stockholder approval.

WISA TECHNOLOGIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three Months Ended March 31, 2024 and 2023

Subsequent Event, continued

Initial May 2024 Registered Direct Offering and Concurrent Private Placement

On May 13, 2024, the Company entered into a securities purchase agreement with certain accredited investors, pursuant to which the Company agreed to issue and sell to such investors (i) in a registered direct offering, 785,000 shares of common stock at $ 3.31 per share, and (ii) in a concurrent private placement, common stock purchase warrants (the “Initial May 2024 Warrants”) exercisable for an aggregate of up to 785,000 shares of common stock, at an initial exercise price of $ 3.18 per share (the “Initial May 2024 Registered Direct Offering and Concurrent Private Placement”).

The Initial May 2024 Warrants contain 4.99 / 9.99 % beneficial ownership limitations, are exercisable upon issuance and expire on the fifth anniversary of the issuance date of such warrants.

Issuance of shares of common stock upon “alternative cashless exercise” pursuant to the terms of such warrants is subject to stockholder approval.

Second May 2024 Registered Direct Offering and Concurrent Private Placement

On May 15, 2024, the Company entered into a securities purchase agreement with certain accredited investors, pursuant to which the Company agreed to issue and sell to such investors (i) in a registered direct offering, 675,000 shares of common stock at $ 3.61 per share, and (ii) in a concurrent private placement, common stock purchase warrants (the “Second May 2024 Warrants”) exercisable for an aggregate of up to 675,000 shares of common stock, at an initial exercise price of $ 3.48 per share (the “Second May 2024 Registered Direct Offering and Concurrent Private Placement”).

The Second May 2024 Warrants contain 4.99 / 9.99 % beneficial ownership limitations, are exercisable upon issuance and expire on the fifth anniversary of the issuance date of such warrants.

Issuance of shares of common stock upon “alternative cashless exercise” pursuant to the terms of such warrants is subject to stockholder approval.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements