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Item 1. Business

2025-03-31 compared with 2024-04-01 · 248 added, 245 removed, 10 unchanged (98% of the section changed)

We believe that the future of audio technology is in wireless devices and that WiSA is well positioned to deliver best-in-class immersive wireless sound technology for intelligent devices and next generation home entertainment systems.

Historically we have sold modules which wirelessly transmit and receive audio directly to speakers.

In late 2023, we launched a new wireless technology, WiSA E, that is software-based and works with standard Wi-Fi chips.

Additionally, we plan to license our proprietary software technology, currently embedded in our wireless modules, to other companies who can then embed our technology into other Wi-Fi enabled smart devices.

The segment of the wireless audio market that WiSA focuses on is comprised of scalable multichannel solutions with levels of latency that are low enough to synchronize with video.

The term multichannel refers to the use of multiple audio tracks to reconstruct a sound field using multiple speakers.

As part of the effort to grow the wireless multichannel home audio segment, WiSA Technologies, Inc.

was a founding member of the WiSA Association, an association dedicated to providing industry leadership and consumer choice through interoperability testing between brands.

Products certified and marked with a WiSA Association logo have been tested to inter operate.

This preserves consumer choice by enabling consumers to choose different wireless transmitting products across different brands where audio is decoded with speakers that have the WiSA Association logo displayed.

Our marketing strategy focuses on, what we believe, are two emerging wireless audio market needs:

immersive, multi-channel audio and robust wireless performance.

WiSA sold custom semiconductor chips and wireless modules to premium audio brands in the consumer electronics industry.

We believe that a growing adoption of our technology by leaders in this industry will revolutionize the way people experience media content through their mobile and handheld devices, televisions (“TVs”),soundbars (“SBs”), set-top-boxes/streaming devises and personal computers (“PCs”).

We were formed as a Delaware limited liability company on July 23, 2010 and converted into a Delaware corporation, effective December 31, 2017.

Effective as of March 11, 2022, we changed our name to WiSA Technologies, Inc.

On December 31, 2024, we purchased certain intellectual property assets from EOS Technology Holdings Inc., followed by changing our name to Datavault AI Inc.

on February 13, 2025.

As we expand the business in the future with the assets from this acquisition, we plan to focus on cyber secure privacy protected data management and monetization and acoustic science innovations, as well as continuing to use wireless audio to transmit data and audio for consumer use and will solidify our position as an innovative leader in next-generation data technology.

Our established leadership in wireless HD spatial audio transmission semiconductors, technology modules and proprietary platforms are precision engineered in the United States from our Headquarters in Beaverton, Oregon.

Our inventions transform what our future customers will be able to achieve with data and multi-channel HD wireless audio.

Datavault AI stands at the forefront of innovation, delivering cutting-edge Web 3.0 data management and high-performance computing (HPC) solutions to a global audience.

Datavault AI is a pioneering technology licensing company that owns a portfolio of patented, secure platforms designed to redefine how data is managed, valued, and monetized in the modern era.

Leveraging our proprietary HPC capabilities and advanced software, we aim to empower future customers worldwide with revolutionary data solutions.

Once the acquired intellectual property assets are fully integrated and a revenue stream is established, we expect that the heart of our offerings will be our artificial intelligence (AI)-driven agents—branded as Data Vault®, DataValue®, DataScore®, and Data Vault Bank®.

These tools harness generative AI to deliver enterprise-grade data management solutions, that are differentiated by privacy first, cyber secure utilities tailored for the HPC landscape and the Web 3.0 paradigm.

Valuation, scoring based on a myriad of industry specific parameters as well as the ability to analyze our future customers’ data regarding their ownership, meta indexing, touch-less appraisal, cyber secure, regulatory compliant and reporting analytics are among the resources that the Data Vault platform will be able unlock for our future customers.

One key characteristic of Web 3.0 systems is the decentralized access to blockchain systems and the ability to mint smart contracts and other tools that change what organizations can achieve.

AI adds yield management that will focus on our future customers’ revenue, generated by data objects that our AI Agents - DataValue, DataScore and Data Vault Bank, will work on in parallel to maximize both inventory and yield.

Combination and derivative data, non-competitive, or controversial data is identified, objectified and priced through automation systems and Information Data Exchange unlocks.

Without the need to support storage, compute or other technology commodities, the company will focus on high yield data sets where Datavault AI and its future customers will stand to make value and revenue through actionable intelligence.

Without increasing the cyber or data security vulnerabilities, and without an activation or installing software, the capabilities in our Web 3.0 Data Vault platform will be adjunctive, trained on customizable and ubiquitous data sources from any network and in any format.

Telecom, VOIP, wireless, CCTV, IPTV, video surveillance, computer vision, and traditional databases are all compatible in a meta form.

In Data Vault, these data sets can be perceived, experienced, anchored, and minted into immortality in the form of non-fungible tokens, or sold directly to buyers on our Information Data Exchange.

In addition to compatibility, Datavault AI solutions are fortified with the blockchain characteristic of immutability and integrations with blockchains of any type, which sets our technology apart, and our Information Data Exchange provides for scalable, peer-to-peer transactional capability.

Our technology ensures data ownership immutability, experiential data observability, precise data asset valuation, and secure monetization—which we believe will unlock unprecedented opportunities for businesses in an increasingly data-driven world on which our executive leadership, with our engineering and software development teams, can capitalize.

Datavault AI has two synergistic platforms (Data Science and Acoustic Science) that plan to optimize the revenue generation of the Company.

Our Data Sciences Platform will be anchored by our flagship Data Vault® platform—a patented, cyber-secure asset tokenization platform that sets a new standard for trust and innovation in Web 3.0 data science.

Central to this platform are our industry-first Sumerian® crypto-anchors, which will be able to empower future customers to verify, validate, and monetize both physical and digital assets with confidence.

We believe this groundbreaking technology will enable future customers to seamlessly track and monetize historical, current, and future data tied to any asset, integrating effortlessly with existing systems.

By layering blockchain and AI-driven metadata atop diverse data sources, Data Vault® plans to provide licensees with a framework for indexing, valuing, scoring, and monetizing assets in immersive 2D and 3D experiential environments.

Complementing this, our patented Information Data Exchange® (IDE) will offer a secure, privacy-compliant marketplace where tokenized data and assets can be marketed, bought, and sold directly

between owners and buyers.

This division will enable enterprises to unlock the full potential of their data assets and provide the ability to turn data from a cost center into cash that can enrich their balance sheets.

Products and services of Datavault AI’s Data Sciences Platform, which we anticipate will be significant revenue generators in the future, include Data Vault®—our multi-patented Web 3.0 data perception, visualization, valuation & monetization software platform for high performance computing.

Data Vault will be monetized through licensing and software as a service (SaaS) contracts.

AI driven agents will be used within Data Vault to create new data assets and valuable insights for Datavault AI’s future customers in the data and AI space.

DataScore, DataValue, and Digital Twin Institute are Data Vault outputs that will be able to be monetized through revenue splits with future Datavault AI customers.

Our technology creates connections for our customers to their decentralized blockchains with capacity to connect to any qualified chain and the ability to create proprietary new blockchains for our future licensed customers.

Data Vault integrates data sets, mints digital assets on any blockchain and provides industry first crypto anchors, metadata asset indexing, blockchain tokenization systems management, data ownership monetization with Data Vault Bank automated smart contract production, VerifyU—our academic accreditation system, asset tokenization, name image likeness (NIL) monetization, Information Data Exchange®, encrypted data monetization, tokenized data and assets, each of which are easily tracked and will be easily monetized, all within the IDE, in one cohesive platform.

Data Science Division Overview

Datavault AI, through its flagship product Data Vault®, will deliver a pioneering Web 3.0 data management platform offered as a SaaS solution.

Data Vault® aims to redefine how organizations acquire, value, analyze, refine, and monetize their data assets by changing how it is valued, indexed, understood, experienced and turned into cash when it can be done compliantly and in a privacy, cyber secure and regulatory compliant first platform compliance.

This transformative technology integrates advanced Web 3.0 anchor technologies—including blockchain, AI, machine learning (ML), tracking and tracing systems, voice recognition, and 3D visualization—into a patented architecture that will empower future clients to unlock the full potential of their data.

The technology uses AI agents that will be trained on our future clients’ datasets to maximize the usefulness of data across our culture customers’ enterprises.

Secondarily, the platform’s will look to maximize the yield of data systems to offset their costs.

Unlike traditional data management systems, Data Vault® ensures that organizations retain complete ownership and control over their data, providing a secure and scalable foundation for enterprise innovation in the Web 3.0 and supercomputing era without ever moving, changing, ingesting, storing or altering our future customers’ data in any way.

The patented technology will solve for data privacy and security while also opening up data owners to a Global data marketplace that will give our future customers more capital to deploy in their core businesses and tools that will make their revenue generation advanced, and will keep pace with an entirely new Web 3.0 paradigm in how data is valued, protected and monetized to the benefit of Datavault AI clients.

Industry specific Agents and data objects of all types will result from the use of the platform by our future clients.

Our platform’s Information Data Exchange (IDE) introduces robust transactional capabilities, enabling seamless, secure, and transparent data interactions between data owners and users.

This facilitates a fair and equitable exchange of value, addressing the growing need for trusted data ecosystems as AI and ML technologies proliferate.

With decades of expertise in enterprise solutions and cybersecurity, our team has engineered Data Vault® to serve as a comprehensive data valuation, visualization, and monetization platform.

Its versatility will support a wide range of industries, including Biotech, Fintech, Hospitality, Casinos, Food Safety, Education, and Sports & Entertainment, unlocking scalable Web 3.0 opportunities tailored to each sector’s unique needs.

Addressing the Data Challenges of the Future

In an era defined by rapid technological advancement, the rise of AI presents both unprecedented opportunities and significant risks.

Unreliable or unsecured data undermines the integrity of AI systems, threatening the viability of corporations that depend on these technologies to remain competitive.

Data Vault® leverages blockchain technology to protect, price, and produce measurable value from data assets, ensuring that organizations can trust the data powering their AI-driven initiatives.

By providing observability and management of data rights across diverse sources, our platform mitigates risks related to data misuse, including threats to future customers’ name, image, likeness, and other sensitive data assets.

Data Vault® addresses the challenge head-on.

With compliance, cyber security and immutable audit trails, our technology will provide a unified framework for enterprises to index, value, score, and monetize their data assets through our patented information Data Exchange.

We plan for Datavault AI to become an important and trusted partner for businesses navigating the complexities of the digital Web 3.0 economy.

Acoustic Division Overview

Our Acoustic Division, anchored by our patented Adio® ultrasonic platform, is at the forefront of using wireless audio to transmit data and audio for the consumer’s use while enabling our future customers to monetize their usage and data.

Our technology addresses the needs for enhanced experiences in live events, trade shows, retail environment, consumers home entertainment systems, and on premise digital signage.

Acoustic Science

Our Acoustic Sciences Platform now features a fusion of WiSA’s proven and wireless standard technology and the category creating ADIO inaudible tone, data over sound, and mobile quick response technology.

ADIO technology was acquired with plans to enhance the revenue production and productization of WiSA E technology.

Prior to the acquisition of IP assets from EOS Technology Holdings Inc., we had established a leadership position in audio innovation within high-definition wireless audio transmission technology.

These multi-patented spatial and multichannel HD sound transmission technologies—including intellectual property covering audio timing, synchronization, and multi-channel Interference Cancellation—will integrate with the Adio technology we acquired in the acquisition.

Adio is a set of IP pioneering data-over-sound, sonic anchor, and inaudible tone transmission and receiver technologies.

Together, these capabilities create a powerful synergy, blending the extensive intellectual property portfolio that we recently acquired with WiSA’s legacy audio solutions.

We believe this collaboration will deliver transformative value across multiple markets, including sports and entertainment, education, retail, commercial, government, and scientific sectors.

By combining these exclusive patented technologies, we will not only enhance current and future customer experiences but also plan to redefine how data and sound converge can drive business success.

A Patented Ultrasonic Platform Powering Web 3.0 Innovation

Adio® represents a groundbreaking advancement in data-over-sound technology, leveraging ultrasonic signals to provide fully implemented use cases across industries such as advertising, biotech, fintech, e-commerce, AI, ML, broadcasting, streaming, event venues, food safety, ticketing, farming, logistics, livestock management, and credential validation.

This patented Web 3.0 anchor technology, branded Sumerian® integrates seamlessly with Datavault’s broader data management ecosystem, enabling data tokenization, objectification, and tracking.

When paired with complementary patented technologies—such as P-Chip’s micro transponder technology and BASF’s polymer solutions—Adio® achieves first-mover status in key market verticals, delivering a robust technology stack with significant competitive advantages.

Our extensive patent portfolio underpins Adio®’s market leadership, featuring key issued claims that secure long-term ownership of critical verticals.

This IP spans both sender and receiver functionalities, covering applications in music tones, broadcasting, tracking and logistics, user and data validation, verification, and streaming.

and international patent coverage, this IP establishes a formidable barrier to entry for competitors, protecting both core and ancillary feature sets that drive Adio®’s versatility and scalability.

How Adio Works

Adio® enhances consumer and enterprise experiences by simplifying interactions with data and content.

Consumers will opt in via a single interface command, granting permission for Adio®’s listening utility to detect ultrasonic tones and deliver tailored responses—such as offers, multimedia content, or data visualizations—directly to their smartphones.

Unlike QR codes, which require camera-based interaction, Adio® uses microphones to ingest tones, reducing friction and improving accessibility.

These tones can be programmed for timed releases, encrypted file delivery, or networked data links, triggering responses like URLs, virtual reality experiences, or serialized multimedia content.

When integrated with Web 3.0 blockchain technology, Adio® supports digital rights management, authenticity verification, credentialing, tokenomics, and data validation, creating a secure and innovative ecosystem for both consumers and businesses.

Market Positioning and Use Cases

Adio® delivers an industry-first patented data-over-sound content delivery system that transcends traditional audio applications, unlocking future revenue potential.

In advertising and marketing, it enables brands to engage consumers through inaudible tones embedded in broadcasts or live events.

In food safety and asset tracking, Adio® pairs with marking technologies—such as molecular polymers, micro transponders, Wi-Fi, Bluetooth, radio frequency identification, near-field communication, and social media—to provide end-to-end traceability and authenticity validation.

Transmission channels range from dedicated tone transmitters to streaming platforms, radio, satellite, and social media, ensuring compatibility with existing sound infrastructure.

We believe this seamless integration, coupled with straightforward and cost-effective installation, will give our future customers a technical edge and will foster creativity in delivery.

Strategic Vision and Growth Opportunities

Our Acoustic Platform is committed to driving innovation in the wireless audio market with Adio and WiSA.

As a founding member of the WiSA Association, we promote interoperability and consumer choice through certified, logo-bearing products that ensure seamless performance across brands.

Our WiSA marketing strategy emphasizes two emerging needs:

immersive multichannel audio and robust wireless performance.

Our Adio strategy will enable our future customers to simultaneously transmit data to their customer for advertising, education, and public service announcements.

Jointly licensing Adio and WiSA software to premium audio brands and smart device manufacturers, we aim to revolutionize how consumers experience media content across mobile devices, televisions, soundbars, set-top boxes, and personal computers.

By combining our expertise in wireless audio with our innovative Adio® platform, we will redefine how sound can deliver both entertainment and utility across a variety of use cases.

Historically, our Acoustic Platform focused on developing modules that wirelessly transmit and receive audio directly to speakers.

In late 2023, we introduced WiSA E, a software-based wireless technology leveraging standard Wi-Fi chips, marking a significant evolution in our offerings.

Looking forward, we intend to license our proprietary software—currently embedded in our wireless modules—to third-party manufacturers, enabling them to integrate our technology into a broad range of Wi-Fi-enabled smart devices.

Comprehensive Datavault AI Market Opportunity and Strategic Vision

Datavault AI, through its patented Data Vault® platform, is uniquely positioned at the intersection of Web 3.0, AI, and enterprise data management, offering a first-to-market solution that aligns with the growing demand for decentralized, secure, and value-driven data ecosystems.

Our Data Vault platform’s use cases span operational enhancements—such as improving supply chain transparency in Food Safety, enabling secure patient data monetization in Biotech, or powering real-time analytics in Sports & Entertainment—to broader strategic initiatives that redefine how enterprises engage with their data and digital twins that will change what we can perceive from data today.

By integrating cutting-edge technologies into cohesive solutions and customer centric offerings for future customers, and licensing where our future customers connect to utilities we create which will help achieve our solutions on future customers’ networks, we can provide our future clients with the tools to not only adapt to the Web 3.0 landscape, but to lead within it.

Our solutions will provide for immediate acclamation to a world in Web 3.0 where data has become power itself.

Looking ahead, Datavault AI is committed to expanding the capabilities of Data Vault®, enhancing its utility across additional industries and use cases.

As the volume and complexity of data continue to grow, our focus remains on delivering innovative solutions that will empower our future clients to maintain sovereignty over their data while capitalizing on its economic potential.

Through continuous investment in research and development, strategic partnerships, and customer-centric innovation, we aim to solidify our leadership in the data management space and drive long-term value for our stakeholders by building a new customer base and revenue stream.

Our Business Focus

Our primary business focus is to enable mainstream consumers and audio enthusiasts to experience high quality wireless immersive audio.

We intend to continue selling our proprietary wireless modules to consumer electronics companies while also expanding our focus to implement a lower-cost solution by porting our software onto commercially available internet of things (“IoT”) modules with integrated Wi-Fi technology.

Datavault AI is dedicated to pioneering the future of data and audio technology through our innovative Data Vault® and Adio® platforms, delivering transformative Web 3.0 solutions that empower enterprises and consumers alike.

Our Data Platform will redefine data management by providing a first-to-market SaaS platform that enables organizations to acquire, value, refine, and monetize their data assets with unparalleled security and control.

Simultaneously, our Acoustic Platform will leverage our patented ultrasonic Adio® technology to deliver immersive wireless audio and data-over-sound applications, unlocking new utility across industries ranging from entertainment to food safety.

Together, these platforms position Datavault AI at the forefront of the digital and audio innovation landscape, addressing the growing demand for trusted, scalable, and value-driven ecosystems in the Web 3.0 era.

Our strategic focus is to accelerate growth and expand our market presence through a dual-pronged approach of mergers and acquisitions (M&A) and direct organic sales growth.

We intend to pursue targeted M&A opportunities to acquire complementary technologies, intellectual property, and customer bases that enhance our Data Vault® and Adio® offerings, broaden our industry reach, and strengthen our competitive moat.

Concurrently, we are committed to scaling our direct sales efforts to penetrate key verticals—such as biotech, fintech, hospitality, and advertising—capitalizing on our first-mover advantages and robust patent portfolios.

By integrating acquired assets with our existing platforms and leveraging our sales channels, we aim to rapidly expand our footprint, drive revenue growth, and deliver long-term value to our shareholders through future revenue and customer streams.

Our leadership remains focused on executing a disciplined growth strategy that maximizes enterprise value through organic innovation and strategic consolidation.

Human Capital Resources

As of March 12, 2025, we had 66 domestic employees with 63 of those employees classified as full-time.

In the United States, we had 66 employees, including 36 employees that work in our research and development department, 11 employees in our sales and marketing

department, 2 employees that work in our facilities and IT department and 8 employees that work in our general and administrative department.

In addition, we have one logistics employee in China, one sales employee in Taiwan and one sales employee in Korea.

None of our employees are represented by a labor union with respect to his or her employment.

In certain countries in which we operate, we are subject to, and comply with, local labor law requirements.

We have not experienced any work stoppages, and we consider our relations with our employees to be good.

Raw Materials

Our WiSA E code is exclusively on Realtek for 5ghz and Espressif for 2.4 ghz.

Our HT chips are sole sourced but we have plenty of inventory.

Speakers are sole sourced from Hansong but there are numerous other ODMs that could build speakers.

Historically, the company strategically partners with its vendors for specific products.

In each category, they are the primary source for parts.

Each has excess capacity to meet any surge in volume.

Each can be replaced with another vendor should a supply problem develop.

In 2025 and beyond, with the Data Vault IP acquisition and WiSA E software, we expect our revenue to shift to more software and less hardware.

No materials supplier makes up more than 10% of our purchases.

Reliance Upon One or a Few Customers

For the year ended December 31, 2024, Richsound Research Ltd.

accounted for 29%, Sagemcom Broadband SAS 19%, Amazon 18% and Edom Technologies Co, Ltd.

10% of our net revenue.

For the year ending December 31, 2023, Amazon accounted for 25%, Edom Technologies Co, Ltd.

19%, Focus Camera 14% and Guo Guang Electric Co 13% of our net revenue.

It has been our experience that a large percentage of our sales have been attributable to a relatively small number of customers in any particular period.

Industry Background

The primary growth segments for in-home entertainment have been “Bluetooth” stereo accessories which include single speakers, headsets, and more recently, “multi-room” stereo speakers that use your home’s Wi-Fi network to stream audio throughout house.

Another market that continues to grow is the sound bar market.

Sound bars are typically sold with wireless subwoofers and may also be sold with wireless rear speakers.

Datavault AI operates within the burgeoning Web 3.0 ecosystem, a next-generation internet framework defined by decentralization, blockchain technology, and user-centric data control.

Web 3.0 represents a seismic shift from the centralized, platform-dominated Web 2.0 model toward a decentralized digital landscape where individuals and enterprises wield greater autonomy over their data, identity, and transactions.

According to Market Research Future, the global Web 3.0 blockchain market was valued at $2.2 billion in 2021 and is projected to reach $38.6 billion by 2030, growing at a compound annual growth rate (CAGR) of 43.6% from 2024 to 2030.

This expansion is fueled by rising demand for data privacy, the proliferation of digital assets like cryptocurrencies and non-fungible tokens (NFTs), and advancements in internet infrastructure, such as 5G and 6G deployment.

The Web 3.0 market intersects two pivotal trends shaping Datavault AI’s strategic focus.

First, the integration of AI and ML into enterprise operations is driving demand for secure, decentralized data ecosystems.

Grand View Research estimates the broader Web 3.0 market, encompassing blockchain and AI-driven applications, at $2.25 billion in 2023, with a projected CAGR of 49.3% through 2030, reflecting the urgency for platforms like Data Vault® to address data valuation and monetization needs in sectors such as biotech, fintech, and hospitality.

Second, the audio technology sector is evolving toward wireless, multifunctional solutions, with Straits Research forecasting the Web 3.0 blockchain market—spanning innovative applications like Adio®’s data-over-sound technology—to grow from $3.34 billion in 2023 to $93.46 billion by 2032 at a CAGR of 44.8%.

This convergence of data and audio innovation within Web 3.0 creates a fertile landscape for Datavault AI’s offerings.

While established technology giants and blockchain startups vie for dominance, we believe the market remains ripe for pioneers who While established technology giants and blockchain startups vie for dominance, we believe the market remains ripe for pioneers who can deliver scalable, practical solutions.

Datavault AI plans to capitalize on this through its patented Data Vault® platform, which will empower enterprises to maintain data sovereignty amid growing cybersecurity threats, and its Adio® technology, which will leverage ultrasonic signals and blockchain to unlock novel use cases in advertising, supply chain tracking, and beyond.

As consumer and regulatory emphasis on data ownership intensifies—evidenced by the rapid adoption of decentralized finance (DeFi) and NFTs, with NFT funding surging to $4.8 billion in 2021 per CB Insights—we believe Datavault AI is poised to deliver shareholder value by bridging these industry trends with actionable, Web 3.0-enabled solutions for our future customers.

References for market size and growth projections:

- Web 3.0 blockchain market:

$2.2 billion (2021) to $38.6 billion (2030), CAGR 43.6% (Market Research Future).

- Broader Web 3.0 market:

$2.25 billion (2023), CAGR 49.3% through 2030 (Grand View Research).

- Web 3.0 blockchain market:

$3.34 billion (2023) to $93.46 billion (2032), CAGR 44.8% (Straits Research).

- NFT funding:

$4.8 billion in 2021 (CB Insights).

Our Technology

Our fundamental technology addresses some of the main issues that we perceive hinder the growth of immersive audio in the home:

complexity of setup, cost, interoperability between smart devices and the speakers, and robust wireless performance.

We believe that consumers want to experience theater-quality immersive sound from the comfort of their homes.

However, traditional immersive audio systems, commonly referred to as home theater surround sound systems, are wired and often require expensive audio-visual (“AV”) receivers to decode the audio stream, leaving the consumer with the burden of concealing the wires.

Hiring a professional to hide the wires into the walls or floor is invasive, complicated, costly, and time consuming.

Our first-generation wireless technology addresses these problems by transmitting wireless audio to each speaker at Blu-ray quality (uncompressed 24 bit audio up to 96 kHz sample rates) and emphasizing ease of setup.

Our next generation technology, WiSA E, is software IP designed for (i) easy implementation for the manufacturing brand to design with, (ii) broad flexibility to accommodate various price points and business models, and (iii) maintaining high quality wireless performance for the consumer.

Having successfully developed wireless audio solutions for the high-end of the immersive audio market, WiSA is continuing its development of proprietary software (WiSA E) targeted at bringing its best-of-class immersive audio technology to entry/mid-level audio systems.

Noting the growth of the sound bar market, WiSA plans a low-cost, entry-level wireless audio solution designed to meet the needs of the consumer looking for a sound bar-based, value-driven immersive audio system.

To address this market segment, WiSA is currently developing certain proprietary software for which patent applications have been submitted that will enable sound bars as well as smart devices that have Wi-Fi and video media to deliver immersive audio.

First development kits for WiSA E began to ship during late Q3 2023 (pursuant to confidentiality agreements).

Our goal is to commercialize a software based -solution, which other brands can integrate into their devices, that will (i) reduce integration costs for mass market use, (ii) utilize Wi-Fi for wireless connectivity, making it easy to integrate into today’s high volume, low cost systems on a chip (“SOC”) and modules, (iii) provide a low power consumption option to allow for use in battery-powered devices, and (iv) provide compatibility with popular consumer electronic operating systems.

The combined patented data and acoustic technologies breakdown by platform follows;

Data Sciences Platform

Patented Technology Stack

Acoustic Data Perception

WiSA® - Wireless HD Transmission Technology

Data Ownership

Data Vault® - Data Experience AI Agent

Data Visualization

Data Vault Bank® - Smart Contract AI Agent

Data Valuation

DataValue® - Data Valuation AI Agent

DataScore® - Data Scoring AI Agent

Data Anchoring

Sumerian® - Crypto Anchors

Data Monetization

Information Data Exchange® - Buy & Sell Data

Acoustic Sciences Platform

Patented Technology Stack

Adio® - Inaudible Tones Technology

WiSA Spatial, HD Transmission

WiSA Association

Our wholly-owned subsidiary, WiSA, LLC, operates the WiSA Association, which is an association of brands, manufacturers, and influencers within the consumer electronics industry, with the purpose of promoting a standardized method of interoperability between wireless audio components using WiSA’s technology.

The WiSA Association creates, maintains and manages specifications for wireless interoperability that are available to all WiSA Association members.

For products with a WiSA Association certification, the WiSA Association also creates, maintains, and manages testing criteria and specifications for all products to be listed, marketed and sold.

WiSA-certification is an industry-wide “stamp of approval” certifying that a product is interoperable with other products in the WiSA ecosystem and has passed several high-performance tests ensuring interoperability and wireless performance standards are met.

As the sole owner of WiSA, LLC, we certify all WiSA Association products.

WiSA, LLC is also the IP licensing organization for WiSA E interoperable transmission from smart devices to audio devices.

In Q4, 2023, WiSA, LLC announced a licensing program for display devices (TVs and projectors).

In the first 90 days three manufacturers have signed licenses.

Currently, WiSA-certified products are required to use WiSA modules in order to meet the standards set by the WiSA Association.

As a result, WiSA Association members purchase modules from us in order to build their products to meet such standards.

Among WiSA-certified products, consumers will be able to outfit their home entertainment system with WiSA-certified speakers and components from any participating vendor with the assurance that the devices will interoperate and provide high quality wireless HD surround sound.

The WiSA Association manages logo usage and trademark guidelines, investigates alternative markets, connects brands to manufacturing resources, and, we believe, provides industry leadership in solving the challenges facing the home theater and commercial markets in the integration of wireless audio technology.

WiSA has designed wireless modules that provide high performance wireless audio for our customers to integrate into their products, such as a speakers, TVs, soundbars, set-top-boxes, and HDMI dongles.

These modules can be designed using our custom semiconductors with our IP built in, as well as a Wi-Fi radio for communications or with our WiSA E software loaded onto a third party IoT Wi-Fi chip.

By designing and selling these modules, we believe that we can reduce our customers’ design expense, accelerate their time-to-market cycle, and reduce the cost of each module.

The consumer’s smart devises must have interoperable WiSA modules compatible with the WiSA transmit technology.

Speakers, with the matching “RX” model, receive the wireless audio signal and processes it for audio play out.

The WiSA Opportunity

We believe that the following attributes:

cost, mobility, video support, ease of installation and quality create a market opportunity for WiSA’s technologies to be adopted by the consumer electronics industry as described further below.

We believe that the simplicity and cost structure of both our original technology and our embedded software solution will make our prices competitive for a wider range of applications in their respective markets, allowing consumer electronics companies to integrate our technology, while also delivering high quality audio.

Video Support

Wireless audio capable of supporting video has become a priority for consumers across a variety of high-volume multimedia platforms, including TV’s, smartphones, game consoles and set-top boxes.

Video applications require audio and video to be perfectly synchronized in order to avoid lip-sync and speaker audio phase distortion issues.

WiSA’s technology prioritizes wireless robustness, latency and speaker synchronization to create an entertaining experience.

Ease of Installation

We believe that the home entertainment market has moved toward simplicity in recent years.

The costly and inconvenient home theaters of the past have left consumers with a desire for audio systems that provide a simplified installation process.

We believe that as the TVs adopt broad use of Dolby Atmos and Dolby Atmos Music, which delivers the immersive audio decoding, new audio systems, including the predominant sound bar system, will need to provide a higher level of performance, especially in the surround-sound market.

WiSA’s technology greatly simplifies the installation process of true surround-sound systems.

This allows consumers to install an immersive audio system with the same amount of effort as a sound bar, but enjoy a far superior experience.

We believe that an overwhelming majority of the content entering consumers’ homes through digital TV and streaming services is provided in a multi-channel format, which is why WiSA’s goal is to facilitate enjoyment of true surround sound for both the everyday consumer and audio enthusiast.

In addition to easy installation, WiSA’s technology provides consumers with a multitude of options, allowing customization of the immersive audio experience individualized to each consumer, without being forced to stick with one brand of speaker.

For example, our hope is that a consumer might start with a WiSA enabled sound bar for their TV and then add a WiSA enabled subwoofer.

That same system can be easily upgraded to a variety of surround sound systems by simply adding more speakers.

Our technology will allow consumers to upgrade an audio system or just one component of the system without the need to replace the entire system.

Consumers can keep the original transmitter, sound bar, and subwoofer and integrate them seamlessly into a new system.

Being able to outfit a home entertainment system with WiSA-enabled speakers and components gives consumers the ability to express their individual preference and needs and provides the assurance that the devices will interoperate, delivering what we believe is the highest standard in HD wireless surround sound.

Dissatisfaction with Bluetooth Performance and Quality

We believe that consumers want better performance and quality from their Bluetooth audio devices.

For example, they may want headsets that stay connected over longer distances or products that offer better audio fidelity.

By offering a solution that addresses these needs at a comparable price point to Bluetooth, we believe that we can build consumer demand for our technology.

Enjoyment of improved audio on existing content

We believe that the growth in the number of video devices streaming multi-channel audio content, coupled with new 3D immersive sound experiences from Dolby’s Atmos and DTS’ DTS:X formats, will help propel the demand for wireless speakers well into the future.

Enjoyment of wireless audio without interference from other wireless signals

Having other devices nearby that also use the 5 GHz band should not affect the performance of a WiSA-enabled audio system, as WiSA’s technology can seamlessly switch to another frequency within the 5 GHz band.

The 5 GHz U-NII spectrum utilized by WiSA technology has up to 24 channels available that are constantly monitored for interference using the Dynamic Frequency Selection sub-band between 5.2 and 5.8 GHz.

When interference is detected, the next channel, having been monitored for over one minute and confirmed for accessibility, is ready to be accessed and WiSA-enabled devices switch seamlessly to that channel, without the user ever noticing or the audio experience being affected.

What Distinguishes WiSA from its Competitors

Both the proprietary technology and the adoption of the technology by leaders in consumer electronics are differentiating factors for WiSA.

Our management believes that WiSA is one of the only companies with the technical capabilities of transmitting high resolution, low latency, and speaker synchronization of wireless audio capable of supporting up to eight channels.

Premium consumer brands, like Bang & Olufsen, Harman International, a division of Samsung, and LG Electronics have begun to adopt our technology as a valued feature in performance products.

Category Defining Wireless Audio

Our first generation wireless audio technology delivers industry leading eight channels of uncompressed audio directly to the speakers in 24 bit and up to 96 kHz sample rates.

This means that a consumer can experience audio exactly as it was mastered in the studio.

WiSA’s technology supports surround sound systems up to 7.1 or 5.1.2 for Dolby Atmos® configurations.

Alternative technologies such as, Bluetooth and Wi-Fi standards were not designed to transmit fixed low latency audio that is synchronized to video.

However, Bluetooth and Wi-Fi standards can work well for audio-only wireless transmission, when video is not a part of the listening experience.

In audio-only applications, latency is less critical and audio data can be buffered in memory to ensure proper speaker synchronization even when data retransmissions are needed in today’s congested wireless environments.

In video applications, retransmissions add to latency.

Standard Bluetooth and Wi-Fi standards have long variable latency that can exceed acceptable audio to video synchronization and make quality multichannel audio experience unachievable.

A few custom silicon-based solutions exist today that improve on Bluetooth and Wi-Fi standards based performance, but compared to WiSA, such products have longer latencies, lower performing speaker synchronization, and are limited to 2-4 audio channels and often only support 16 bit CD quality audio.

WiSA’s technology roadmap includes proprietary software that will enable standard Wi-Fi protocol to support multi-channel audio for video applications, while permitting WiSA to leverage Wi-Fi’s lower chip and module cost structure.

WiSA’s first generation technology was designed for the mid to high end home theater market and offers a unique feature set that is expected to be included in new product designs for years.

WiSA’s new Wi-Fi strategy enables the Company to compete in the entry-level home theater market at Bluetooth price points, while delivering superior multi-channel performance for higher volume applications.

The Company’s recently announced Discovery module is the first product that integrates WiSA’s new software which enables a transceiver module to keep up to four independent wireless audio channels synchronized in a room size up to 10 meters square.

The Discovery modules is ideally suited for entry level home entertainment systems, including sound bars, TVs, subwoofers and Dolby Atmos® applications.

WiSA Customers

WiSA currently sells wireless modules containing custom semiconductor chips to a growing list of consumer electronics customers, including major brands such as Bang & Olufsen, KEF, LG, Harman International, a division of Samsung, Savant, Skyworth and System Audio.

We believe that the use of our products by well-known consumer electronics brands will provide an opportunity to create wireless audio products that are simple to install and perform at high levels.

Brands such as Bang & Olufsen and Harman have chosen WiSA technology to drive their wireless home audio/theater product assortments.

We believe that their leadership has brought credibility to the technology and paved the way at retail for other brands to follow.

Our goal is to establish and maintain a leadership position as the ubiquitous standard for hi-fidelity wireless, multichannel audio.

To obtain and enhance our position as the leading standard in the audio space, we intend to:

● improve recognition of our WiSA Certification brand and the WiSA standard brand;

● provide excellent products and services to our customers and members;

● make sure our technology is accessible to many consumers by having our technology in consumer electronics devices that sell at a variety of price points;

● expand market awareness of wireless multi-channel hi-fidelity audio experience availability;

● reduce hardware costs;

● enhance and protect our IP portfolio;

● invest in highly qualified personnel;

● build innovative products alongside the world’s leading consumer electronics companies.

We currently sell our modules in relatively small quantities.

As we introduce WiSA E technology to customers, with its lower price points and great flexibility for designs, we expect that orders for our modules will increase.

With larger orders, we believe that we can take advantage of economies of scale and improve gross margins on our modules.

Interoperability

Interoperability is a key aspect of wireless technology.

We believe that this is especially true with audio technology, where unique designs, price points, audio quality and capabilities as well as consumer brand loyalties are significant factors for the end consumer.

Creating home theater and audio components that all work with an interoperable standard creates a high level of confidence in retailers and consumers in the functionality of the entire entertainment system.

Interoperability also increases the opportunity for specialized brands to create new and innovative products knowing they can focus on their specific part of the market and rely on others to create the necessary cohort components.

Proprietary Software

A significant amount of our time and resources are being allocated towards launching a software licensing part of our business under the WiSA E brand.

Customers will receive a license for our TX software, so that any of their devices with a suitable Wi-Fi radio can transmit audio compliant with our standard without having to purchase and integrate our TX module.

We believe that this software will be well positioned for use by major consumer electronics companies in many devices including TVs, handsets, gaming consoles, and computers.

Patent applications have been submitted for key technology innovations in this software.

Research and Development

As of February 9, 2024, our research and development department consisted of 30 dedicated employees.

WiSA’s engineering team has a wide range of expertise, capable of developing all levels of product design, from Application Specific Integrated Circuits (“ASIC”) to modules to finished products.

WiSA research and development has and will continue developing trade secrets for Digital Signal Processing (“DSP”), RF design and testing of WiSA technologies.

WiSA has developed multiple ASICs and certified modules for integration into multiple wireless audio designs by ODMs which are currently shipping to consumers.

The ASIC hardware solution uses a high-performance proprietary network protocol for transmission of multi-channel audio.

WiSA is also currently shipping and developing modules that are Wi-Fi compatible.

The Software (“SW”) solution enables multi-channel audio capabilities on off the shelf IoT modules running RTOS and future Linux/Android based multimedia systems.

The software solution uses a Wi-Fi network for transmission of multi-channel audio.

WiSA released to production a low cost 2.4GHz IoT module supporting (5) audio channels and in the process of porting our software to a 5GHz IoT module in 2024.

We have engaged an Indian design center to focus on Android integration of the core SW for embedded TV applications.

Manufacturing, Logistics and Fulfillment

Our modules are designed and developed in Oregon at our facility, and our manufacturing is outsourced to contract manufacturers located in China.

Our manufacturing facilities have been ISO 9001 and ISO 14001 certified.

We purchase components and fabricated parts from multiple suppliers;

however, we rely on sole source suppliers for certain components used to manufacture our modules.

Several key strategic parts are purchased from suppliers by us and then consigned to our manufacturers, while the vast majority of parts are procured directly by our contract manufacturers.

Our operations team manages the pricing and supply of the key components of our modules and seeks to achieve competitive pricing on the largest value-add components, while leveraging our contract manufacturers’ volume purchases for best pricing on common parts.

We have strong relationships with our manufacturers, helping us meet our supply and support requirements.

Our manufacturing partners procure components and assemble our devices in accordance with our purchase orders.

Demand forecasts and manufacturing purchase orders are based upon customer orders, historical trends, and analysis from our sales and product management functions.

We believe that our manufacturing capabilities are essential to maintaining and improving product quality and performance, and that using outsourced manufacturing enables greater scale and flexibility than establishing our own manufacturing facilities.

While some modules are delivered from our production facility in Oregon, we have a third-party warehouse and fulfillment center in Hong Kong that delivers the majority our modules.

Sales Channels and Customers

WiSA sells modules and integrated circuits (“ICs”) directly to OEM brands worldwide which in turn, sell their system level products to end customers through a vast channel of retailers and dealer networks.

Internationally known brands such as Bang & Olufsen, Harman International, a division of Samsung, LG, System Audio, KEF, and many others are among our current customers, with products aimed at the wireless home theater market.

Most of these brands sell through retailers store fronts and online e-tail.

Marketing and Advertising

Effective and consistent marketing and advertising is critical as we grow our wireless audio solutions.

We have worked with multiple PR agencies on establishing effective messaging to face all segments within our category including press, brands, reviewers, retailers and consumers.

Our focuses are ease of set-up, high quality performance, expandability and the benefits of a true multi-channel surround sound audio solutions.

The semiconductor industry is intensely competitive and has been characterized by price erosion and rapid technological change.

We compete with major domestic and international semiconductor companies, many of which have greater market recognition and greater financial, technical, marketing, distribution and other resources than we have with which to pursue engineering, manufacturing, marketing and distribution of their products.

Competitive products include products that:

(a) are resistant to interference, low latency, long-range, and able to stream uncompressed audio;

(b) target applications in the PC accessory audio, iPod accessory audio, home theater, and consumer & enterprise voice markets;

(c) enable smart TVs, computers and mobile devices to connect to their multiple peripherals wirelessly, and simultaneously from a single host, with the ability to mix-and-match peripherals;

and (d) utilize Bluetooth technology as a means of transmission.

We believe that our technology competes favorably with our competitors for a variety of reasons, including, among others:

● Our technology transmits audio packets with fixed latency in a manner well-suited for multi-channel audio networks and video applications.

● Our technology contains WiFi compatible software which provides the following future key benefits:

o WiFi is not inherently proficient for transporting low latency audio.

WiSA has spent the last 5 years developing a protocol that can leverage off the shelf high volume low cost 2.4GHz and 5GHz IoT chips and modules and scale to higher audio channel counts.

As chip technology performance improves so will our performance.

o WiFi compatibility allows us to operate more efficiently in congested environments while delivering the performance the market demands.

o A software solution will allow WiSA Technologies to pivot into new markets quicker than those making custom proprietary chip solutions.

There are many other factors that impact our ability to be competitive and may impact our success against both larger and emerging competitors.

Intellectual Property

We have key IP assets, including patents and trade secrets developed based on our technical expertise.

As of March 27, 2024, we had 13 issued and 10 pending U.S.

patents covering our technology.

Our currently issued patents expire at various times from September 25, 2027 through March 1, 2040.

IP is an important aspect of our business, and our practice is to seek protection for our IP as appropriate.

A multi-channel audio for surround sound system has technical requirements not required by simple stereo only systems.

Multi-channel systems require each audio channel to be precisely played in time to create a sound field that correlates to video being viewed by a consumer.

WiSA has developed hardware and software core technologies that manage system network latency and speaker phase.

WiSA’s patents are based on protecting our low latency network algorithms and multi receiver synchronization.

We pursue a general practice of filing patent applications for our technologies in the U.S.

and occasionally in foreign countries where our customers manufacture, distribute, or sell licensed products.

We actively pursue new applications to expand our patent portfolio to address new technological innovations.

We have multiple patents covering aspects and improvements for many of our technologies.

Our trademarks cover our various products, technologies, improvements, and features, as well as the services that we provide.

These trademarks are an integral part of our technology licensing program, and licensees typically elect to place our trademarks on their products to inform consumers that their products incorporate our technology and meet our quality specifications.

We protect our IP rights both domestically and internationally.

From time to time, we may experience problems with OEMs of consumer entertainment products in emerging economies.

In the event it becomes necessary, we will take all necessary steps to enforce our IP rights.

Moreover, we have relatively no issued patents outside the U.S.

Growing our licensing revenue in developing countries may depend in part on our ability to obtain and maintain patent rights in these countries, which is uncertain.

Further, because of the limitations of the legal systems in many countries, the effectiveness of patents obtained or that may in the future be obtained, if any, is uncertain.

As of March 27, 2024, we had a total 46 employees working in the United States and internationally, 40 of which work full time.

In the United States, we had 43 employees, including 30 employees that work in our research and development department, 8 employees in our sales and marketing department, 1 employee that works in our manufacturing/logistics/fulfillment department and 5 employees that work in our general and administrative department.

Additionally, we have one logistics employee in China, one sales employee in Taiwan and one sales employee in Korea.

None of our employees are currently covered by a collective bargaining agreement, and we have experienced no work stoppages.

We consider our relationship with our employees to be good.

Recent Developments

2024 Bridge Note and Warrant

On January 22, 2024, the Company entered into securities purchase agreements (the “2024 Bridge Purchase Agreements”), with the holders of Series B Preferred Stock purchase warrants issued in October 2023 (the “Series B Preferred Warrants”), pursuant to which the Company agreed to issue to such holders promissory notes in the aggregate principal amount of $1,000,000 (the “2024 Bridge Promissory Notes”) and common stock purchase warrants (the “2024 Bridge Warrants”) to purchase up to an aggregate of 10,000,000 shares.

The closing of the 2024 Bridge Private Placement occurred on January 23, 2024.

Between January 26, 2024 and February 2, 2024, the 2024 Bridge Promissory Notes were paid back in full.

The 2024 Bridge Warrants contain 4.99/9.99% beneficial ownership limitations and are not exercisable until after the date that stockholder approval is obtained to approve each of (i) the issuance of the 2024 Bridge Warrant Shares issuable upon the exercise of the 2024 Bridge Warrants, as may be required by the applicable rules and regulations of The Nasdaq Stock Market LLC (“Nasdaq”) and (ii) if necessary, a proposal to amend the our certificate of incorporation (the “Certificate of Incorporation”) to increase the authorized share capital of the Company to an amount sufficient to cover the 2024 Bridge Warrant Shares or to effectuate a reverse stock split whereby the authorized share capital is not split and is sufficient to cover the 2024 Bridge Warrant Shares (and such reverse split is effectuated) (“Bridge Warrant Stockholder Approval”), and will expire on the fifth (5th) anniversary of the date on which Bridge Warrant Stockholder Approval is received and deemed effective under Delaware law.

The exercise price of the 2024 Bridge Warrants is subject to downward adjustment, upon any subsequent transaction at a price lower than the exercise price then in effect and standard adjustments in the event of certain events, such as stock splits, combinations, dividends, distributions, reclassifications, mergers or other corporate changes.

Conversion of Series B Preferred Stock

Between January 1, 2024 and March 27, 2024, holders of the Company’s Series B Convertible Preferred Stock, par value $0.0001 per share (the “Series B Preferred Stock”) converted 5,000 shares of Series B Preferred Stock into 1,205,690 shares of common stock, par value $0.0001, of the Company (“Common Stock”).

February 2024 Unit Offering

On February 13, 2024, the Company completed a public offering (the “February 2024 Unit Offering”) of an aggregate of 23,734,000 units (the “February Units”) and 130,106,000 pre-funded units (the “February Pre-Funded Units”) for a purchase price of $0.065 per February Unit and $0.0649 per February Pre-Funded Unit, resulting in aggregate gross proceeds of approximately $10 million.

Each February Unit consists of (i) one share of Common Stock, and (ii) one warrant (the “February Warrants”) to purchase one share of Common Stock (the “February Warrant Shares”), at an exercise price of $0.065 per share.

Each February Pre-Funded Unit consists of (i) one pre-funded warrant (the “February Pre-Funded Warrants”) to purchase one share of Common Stock, and (ii) one February Warrant.

The February Warrants are not exercisable until after the date that stockholder approval is obtained to approve each of (i) the issuance of the February Warrant Shares, as may be required by the Nasdaq Requirement, and (ii) if necessary, a proposal to amend the Certificate of Incorporation to increase the authorized share capital of the Company to an amount sufficient to cover the February Warrant Shares or to effectuate a reverse stock split whereby the authorized share capital is not split and is sufficient to cover the February Warrant Shares (and such reverse split is effectuated) (“Stockholder Approval for February 2024 Unit Offering”), and will expire on the fifth (5th) anniversary of the date on which Stockholder Approval for February 2024 Unit Offering is received and deemed effective under Delaware law.

The February Pre-Funded Warrants are immediately exercisable for one share of Common Stock at an exercise price of $0.0001 per share, and will remain exercisable until exercised in full.

The exercise price of the February Warrant and number of shares of Common Stock issuable upon exercise thereof will adjust in the event of certain stock dividends and distributions, stock splits, stock combinations, reclassifications or similar events.

Upon a Dilutive Issuance (as defined in the February Warrant), the exercise price will downward adjust subject to a floor price equal to $0.0401.

In addition, on the sixth (6th) trading day following the date on which the next reverse stock split is effected by the Company of its outstanding Common Stock following the date of issuance of the February Warrants, the exercise price per February Warrant shall be adjusted to equal the lower of (a) the exercise price then in effect (after taking into account and adjusting for the reverse stock split) and (b) the lowest VWAP (as defined in the February Warrants) of the Common Stock in the five (5) trading days immediately prior to such date.

In connection with the February 2024 Unit Offering, on February 12, 2024, the Company entered into a securities purchase agreement (the “February Purchase Agreement”) with certain investors, pursuant to which the Company agreed, subject to certain exemptions, not to offer for sale, issue, sell, contract to sell, pledge or otherwise dispose of any of its shares of Common Stock or securities convertible into Common Stock until the date of the Stockholder Approval for February 2024 Unit Offering, unless the Company is required to complete a financing prior to the date of the Stockholder Approval for February 2024 Unit Offering, in order to satisfy Nasdaq’s continued listing requirements.

Also in connection with the February 2024 Unit Offering, on February 12, 2024, the Company entered into a placement agency agreement (the “February Placement Agency Agreement”) with Maxim, pursuant to which Maxim agreed to act as placement agent on a “best efforts” basis in connection with the February 2024 Unit Offering.

The Company paid Maxim an aggregate fee equal to 7.0% of the gross proceeds raised in the February 2024 Unit Offering and reimbursed Maxim $75,000 for expenses in connection therewith.

As of the date of this Annual Report, all 130,106,000 pre-funded warrants issued in the February 2024 Unit Offering have been exercised.

Series B Repurchase and Cancellation Transaction

On February 5, 2024, the Company entered into side letter agreements (the “February 2024 Side Letters”) with the holders of Series B Preferred Warrants, whereby such holders agreed to, among others, (i) allow the Company to repurchase all 62,657 outstanding shares of Series B Preferred Stock then held by them at $100 per share with a portion of the proceeds received from the February 2024 Unit Offering, and (ii) cancel all outstanding Series B Preferred Warrants to purchase up to 81,315 shares of Series B Preferred Stock, then held by them, immediately prior to the closing of the February 2024 Unit Offering (collectively, the “Series B Repurchase and Cancellation Transaction”).

The Company used approximately $6.3 million of the proceeds from the February 2024 Unit Offering to repurchase 62,657 shares of the Company’s Series B Preferred Stock, at $100 per share.

February 14 Nasdaq Letter

On February 14, 2024, the Company received a notice (the “February 14 Letter”) from the Listing Qualifications Staff (the “Staff”) of Nasdaq 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 has requested a hearing before the Panel to appeal the February 14 Letter and to address all outstanding matters, including compliance with the Nasdaq Listing Rule 5550(a)(2), the Low Priced Stocks Rule and the Nasdaq requirement for listed companies to maintain a minimum of $2,500,000 in stockholders’ equity for continued listing (the “Stockholders’ Equity Requirement”), which hearing was held on March 28, 2024;

however, as of the date of this Report, the Panel has not yet rendered a decision.

While the appeal process is pending, the suspension of trading of the Common Stock, will be stayed and the Common Stock will continue to trade on the Nasdaq Capital Market until the hearing process concludes and the Panel issues a written decision.

There are no assurances that a favorable decision will be obtained from the Panel.

March 2024 Special Meeting

At a special meeting of our stockholders held on March 15, 2024, our stockholders approved (a) a proposal to amend the Certificate of Incorporation to authorize the Company’s board of the directors (the “Board”) to increase the Company’s share capital stock from 220,000,000 shares to 320,000,000 shares, of which 300,000,000 shares shall be Common Stock (the “Charter Amendment to Increase Authorized Shares”), (b) a proposal to amend the Certificate of Incorporation to authorize the Board to effect a reverse stock split of all outstanding shares of Common Stock, by a ratio in the range of one-for-five to one-for-one hundred and fifty, to be determined in the Board’s sole discretion, (c) the issuance of 20% or more of the Company’s outstanding shares of Common Stock upon exercise of the common stock purchase warrants issued to certain holders of the Company’s Series B Convertible Preferred Stock purchase warrants issued on October 17, 2023, for purposes of Nasdaq Rule 5635(d), (d) the issuance of 20% or more of the Company’s outstanding shares of Common Stock upon exercise of the common stock purchase warrants, dated January 23, 2024, issued to the holders of such warrants by the Company pursuant to certain securities purchase agreements, dated as of January 22, 2024, by and between the Company and each such holder, for the purposes of Nasdaq Rule 5635(d), and (e) the amendment to the Company’s 2018 Long-Term Stock Incentive Plan (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.

March 2024 Warrant Amendment

On March 26, 2024, the Company entered into a warrant amendment agreement (the “Warrant Amendment Agreement”) with holders of (i) certain common stock purchase warrants, issued by the Company to such holders in connection with certain inducement agreements, dated as of December 5, 2023, by and between the Company and each such holder (the “December 2023 Warrants”), as amended by that certain warrant amendment agreement, dated as of February 5, 2024, (ii) certain common stock purchase warrants, dated January 23, 2024 (the “January 2024 Warrants”), and (iii) certain common stock purchase warrants, dated February 13, 2024 (the “February 2024 Warrants”, and together with the December 2023 Warrants and the January 2024 Warrants, the “Original Warrants”), whereby the holders agreed to (i) amend the exercisability provision in the December 2023 Warrants and January 2024 Warrants so such warrants shall not be exercisable until one or more certificates of amendment to the Certificate of Incorporation are filed with the Secretary of State of the State of Delaware to effectuate an increase in authorized shares of capital stock of the Company and a reverse stock split of the Company’s outstanding shares of Common Stock;

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 Company’s next reverse stock split of its shares of Common Stock, pursuant to each of Section 2(c) in the December 2023 Warrants and the January 2024 Warrants and Section 3(f) of the February 2024 Warrants, as applicable, for purposes of compliance with Nasdaq.

March 2024 Charter Amendment

On March 25, 2024, we filed an amendment to our Certificate of Incorporation to increase our authorized shares of capital stock from 220,000,000 shares to 320,000,000 shares, of which 300,000,000 shares are designated as Common Stock.

March 2024 Offering

On March 27, 2024, we entered into a securities purchase agreement with certain purchasers, pursuant to which we issued and sold to such purchasers (a) in a registered direct offering, (i) 62,675,000 shares of Common Stock and (ii) pre-funded warrants to purchase up to 14,001,478 shares of Common Stock, at an exercise price of $0.0001 per share and (b) in a concurrent private placement, common stock purchase warrants exercisable for an aggregate of up to 76,676,478 shares of Common Stock, at an exercise price of $0.04 per share, for aggregate gross proceeds of approximately $2.3 million (such offerings, the “March Offering”).

The March Offering closed on March 27, 2024.

Nathaniel Bradley Inducement

We granted Mr.

Bradley, effective January 2, 2025, an inducement award agreement (the “Inducement Award Agreement”), pursuant to which Mr.

Bradley was granted 1,200,000 units of our restricted stock (the “Units”) as an inducement material to Mr.

Bradley’s entering into employment with us.

The Units were approved by the Board and granted outside of our 2020 Stock Incentive Plan and 2018 Long-Term Stock Incentive Plan in accordance with Nasdaq Listing Rule 5635(c)(4).

The Inducement Award Agreement contemplates half of the Units vesting in equal 3-month installments over a 36-month period beginning March 20, 2025, and the other half of the Units vesting upon our aggregate revenue equaling or exceeding $40 million over any trailing 12 calendar month period ending on or prior to the date that is 5 years from the grant date.

February 26, 2025 RSA Grant to Employees, Directors and Officers

On February 26, 2025, we granted 6.1 million RSA awards from the 2018 Long-Term Stock Incentive Plan to our employees, directors and officers with a grant date fair value of $1.04 per share.

The award includes 2.2 million performance-based grants to certain executives which will vest upon the achievement of revenue milestones with the remaining awards containing service-based vesting requirements and are earned in equal increments over the subsequent twelve quarters.

Share Exchange Agreement

On March 16, 2025, we entered into a share exchange agreement (the “Share Exchange Agreement”) with NYIAX, Inc., a Delaware corporation (“NYIAX”), for the exchange of 900,000 NYIAX shares of common stock, par value $0.0001 per share (the “Shares”) for aggregate consideration of up to 5,000,000 shares of our common stock, par value $0.0001 per share (collectively, the “Exchange”).

NYIAX operates a NASDAQ-integrated trading platform that enables trading of long-term media contracts.

Using patented blockchain-powered technology, the platform brings financial market standards to advertising transactions, improving transparency and automation.

The Share Exchange Agreement provides that as consideration for the Shares transferred by NYIAX to us, we will issue to NYIAX (i) 3,000,000 newly issued, fully paid and nonassessable shares of our common stock (the “Closing Shares”), and (ii) 2,000,000 newly issued, fully paid and nonassessable shares of our common stock (the “Additional Shares”).

The Closing Shares shall be issued in four equal quarterly tranches starting from the closing.

The Additional Shares shall be issued only upon completion of a complete advertising cycle for a third party clientele, and upon the parties’ mutual written agreement that the Adio Platform has been integrated into the NYIAX Platform upon completion of the advertising cycle.

The Additional Shares shall be issued within thirty (30) days from the completion of the integration.

The Share Exchange Agreement includes customary representations and warranties and various customary covenants and closing conditions that are subject to certain limitations, including, without limitation, certain agreements.

Intellectual Property Cross-License Agreement

In connection with the Exchange, on March 16, 2025, we, entered into a white label, co-marketing and intellectual property cross-license agreement (the “License Agreement”) with NYIAX, where we received a non-exclusive license under certain of NYIAX’s jointly owned patent rights and know-how, and a non-exclusive license to white label NYIAX’s proprietary software-as-a-service advertising brokerage platform, all within the field of data, information and asset monetization and exchange.

In exchange, we granted to NYIAX a non-exclusive license under certain of our wholly owned patent rights, know-how and trademarks, including with respect to our Adio Platform, in the field of advertising buying, selling and brokerage.

As consideration for the’ services provided by NYIAX pursuant to the License Agreement and the rights to access and use the NYIAX Platform granted to us, we will issue to NYIAX 2,530,000 newly issued, fully paid and nonassessable shares (such shares, the “Consideration Shares”) of our common stock

As consideration for the rights granted to NYIAX under the License Agreement, NYIAX shall pay to us a license fee in the form of a convertible promissory note in the aggregate amount $2,500,000 (the “NYIAX Convertible Note”).

The NYIAX Convertible Note is due on the first anniversary of the closing.

NYIAX agreed to pay interest to us on the aggregate unconverted and then outstanding principal amount of the NYIAX Convertible Note at the rate of four percent (4%) per annum, accruing from the closing.

The NYIAX Convertible Note may be prepaid in full at NYIAX’s election.

The NYIAX Convertible Note will automatically convert at the earlier of (i) the maturity date, and (ii) the first underwritten public offering of NYIAX pursuant to an effective registration statement under the Securities Act, covering the offer and sale by NYIAX of its equity securities, as a result of or following which NYIAX shall be a reporting issuer under the Securities Exchange Act of 1934, as amended, and NYIAX Common Stock is listed on the trading market, at a conversion price of $2.00 per share.

The License Agreement includes customary representations and warranties and various customary covenants and closing conditions that are subject to certain limitations, including, without limitation, certain agreements.

Software Development Agreement

In connection with the Exchange, on March 16, 2025, we entered into a software development agreement (the “Software Development Agreement”) with NYIAX, pursuant to which NYIAX has engaged us to develop certain software and provide certain additional professional services as the parties will agree under one or more statements of work.

The Software Development Agreement includes customary representations and warranties and various customary covenants and closing conditions that are subject to certain limitations, including, without limitation, certain agreements.

Registered Direct Transaction

On February 13, 2025, we closed an offering (the “February 2025 Offering”) pursuant to the securities purchase agreement (the “February 2025 Purchase Agreement”) with the investors (the “February 2025 Investors”), In the February 2025 Offering, we issued and sold to the February 2025 Investors in a registered direct offering, (a) an aggregate of 4,757,126 shares of our common stock, par value $0.0001 per share, and (b) common stock purchase warrants (the “February 2025 Warrants”, and together with the shares, the “February 2025 Securities”) exercisable for an aggregate of up to 4,757,126 shares of common stock, at an exercise price of $1.14 per share (the “February 2025 Warrant Shares”) at a combined offering price of $1.14 per share, for aggregate gross proceeds of approximately $5.4 million.

The February 2025 Warrants will be immediately exercisable upon issuance and will expire on the fifth anniversary of the issuance date of the February 2025 Warrants.

Once issued, the February 2025 Warrants may be exercised, in certain circumstances, on a cashless basis pursuant to the formula contained in the February 2025 Warrants.

Under the February 2025 Purchase Agreement, we agreed, subject to certain exceptions, (i) not to offer for sale, issue, sell contract to sell, pledge or otherwise dispose of any of our shares of common stock or securities convertible into common stock until 30 days after the closing date of the February 2025 Offering, and (ii) not to issue certain securities if the issuance would constitute a variable rate transaction for a period of 4 months from the closing date of the February 2025 Offering, in each case unless we are required to complete a financing prior to the applicable date in order to satisfy Nasdaq’s continued listing requirements.

The February 2025 Securities to be issued in the registered direct offering and the February 2025 Warrant Shares issuable upon exercise of the February 2025 Warrants are being offered pursuant to our shelf registration statement on Form S-3 (File 333-267211) (the “Shelf Registration Statement”), initially filed by us with the Securities and Exchange Commission (the “SEC”) under the Securities Act of 1933, as amended (the “Securities Act”), on September 1, 2022 and declared effective on September 13, 2022.

Placement Agency Agreement

In connection with the February 2025 Offering, on February 13, 2025, we entered into a placement agency agreement (the “Placement Agency Agreement”) with Maxim Group LLC (the “Placement Agent”), pursuant to which the Placement Agent agreed to act as placement agent on a “reasonable best efforts” basis in connection with the February 2025 Offering.

Pursuant to the Placement Agency Agreement, we agreed to pay the Placement Agent an aggregate fee equal to 7.0% of the gross proceeds raised in the February 2025 Offering and reimburse the Placement Agent an amount up to $75,000 for expenses in connection with the February 2025 Offering.

We also agreed to issue the Placement Agent (or its designees) a private warrant (the “Placement Agent Warrant”) to purchase up to 5.0% of the aggregate number of February 2025 Securities sold in the offering, or warrants to purchase up to 475,713 shares of common stock (such shares, the “Placement Agent Warrant Shares”), at an exercise price equal to 125.0% of the offering price per share of common stock, or $1.425 per share.

The Placement Agent Warrants will be exercisable 6 months after the commencement of sales in the February 2025 Offering and will expire on the five year anniversary of the initial exercise date.

EOS Technology Holdings Inc.

Asset Purchase

On December 31, 2024 (the “DV Closing Date”), we completed the previously announced asset purchase of information technology assets, certain patents and trademarks (collectively, the “Acquired Assets”) from EOS Technology Holdings Inc.

(“EOS Holdings”).

At the DV Closing, pursuant to an asset purchase agreement, by and between us and EOS Holdings, dated as of September 4, 2024, and as amended by that certain amendment to the asset purchase agreement, dated as of November 14, 2024, and as further amended from time to time (the “DV Asset Purchase Agreement”), we acquired the Acquired Assets for an aggregate purchase price consisting of (i) $10,000,000 paid in the form of a promissory note issued by us to EOS Holdings (the “DV Convertible Note”), and (ii) 40,000,000 shares (the “Closing Stock Consideration”) of validly issued, fully paid and nonassessable shares of our restricted common stock, par value $0.0001 per share, issued by us to EOS Holdings and its designees.

Executive Leadership

On December 31, 2024, Brett Moyer, formerly Chief Executive Officer of the Company, assumed the role of Chief Financial Officer in connection with the DV Closing.

On December 31, 2024, we and Mr.

Moyer entered into a new employment agreement, dated as of December 31, 2024 (the “Moyer Employment Amendment”).

In his capacity as our Chief Financial Officer, pursuant to the Moyer Employer Agreement, Mr.

Moyer will receive an initial base salary of $420,000 per year, with an opportunity to receive an annual bonus, made available to our senior management from time to time by the Board.

Pursuant to the Moyer Employment Agreement, we will pay to Mr.

Moyer a stay bonus of $400,000, payable in quarterly instalments during 2025.

On December 31, 2024, pursuant to the Asset Purchase Agreement, the Board appointed Nathaniel Bradley as our new principal executive officer and a member of the Board, effective upon the Closing.

On December 31, 2024, we and Mr.

Bradley entered into an employment agreement, dated as of December 31, 2024 (the “Bradley Employment Amendment”).

In his capacity as our Chief Executive Officer, pursuant to the Bradley Employment Agreement, Mr.

Bradley will receive an initial base salary of $450,000 per year, with an opportunity to receive an annual bonus, made available to our senior management from time to time by the Board.

On February 13, 2025, we filed a Certificate of Amendment to its Certificate of Incorporation with the Secretary of State of the State of Delaware to change its name to “Datavault AI Inc.”

Our Corporate Information

We were formed as a limited liability company in Delaware on July 23, 2010.

W e converted to a Delaware corporation, effective December 31, 2017.

Effective as of March 11, 2022, the Company changed its name to “WiSA Technologies, Inc.” The address of our corporate headquarters is 15268 NW Greenbrier Pkwy, Beaverton, OR 97006.

Our website address is www.wisatechnologies.com.

We converted to a Delaware corporation, effective December 31, 2017.

Effective March 11, 2022, we changed our name to “WiSA Technologies, Inc.” On December 31, 2024, we completed the purchase of certain information technology assets, patents and trademarks from EOS Technology Holdings Inc.

Effective as of February 13, 2025, we changed our name to “Datavault AI Inc.” The address of our corporate headquarters is 15268 NW Greenbrier Pkwy, Beaverton, OR 97006.

Our website address is https://ir.datavaultsite.com.

The information contained in or accessible through our website is not part of this prospectus and is intended for informational purposes only.

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What changed 10-K

Item 1. Business