What changed in this filing

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Item 1. Financial Statements

2024-01-08 compared with 2023-11-13 · 197 added, 109 removed, 444 unchanged (41% of the section changed)

1 unchanged sentence

Consolidated Balance Sheets

and cash equivalents

receivable, net of allowance of doubtful accounts of $ 209,710 and $ 138,331 as of March 31, 2023 and December 31, 2022, respectively

Prepaid expenses and

other current assets

Current assets

Cash and cash equivalents

Restricted cash

Accounts receivable, net of allowance of doubtful accounts of $ 0 and $ 138,331 as of September 30, 2023 and December 31, 2022, respectively

Prepaid expenses and other current assets

Total current assets

lease right-of-use assets, net

AND STOCKHOLDERS’ EQUITY

maturities of bridge loan agreement

maturities of operating lease liabilities

Deferred revenue, current

Equipment, net

Operating lease right-of-use assets, net

Intangible assets, net

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities

lease liabilities, less current maturities

Bank credit line

Accounts payable

Bridge loan agreement

Current maturities of operating lease liabilities

Accrued expenses

Deferred revenue, current

Total current liabilities

Operating lease liabilities, less current maturities

Deferred revenue, noncurrent

and Contingencies (Note 7)

Stockholders’

Stock, authorized:

Total liabilities

Commitments and Contingencies (Note 6)

Stockholders’ equity

Preferred Stock, authorized:

2,000,000 shares at $ 0.01 par value;

0 shares issued and outstanding

Stock, authorized:

Common Stock, authorized:

60,000,000 shares at $ 0.01 par value;

issued and outstanding:

1,887,535 shares at March 31, 2023 and 1,877,970

shares at December 31, 2022 respectively

paid-in capital

1,898,466 shares at September 30, 2023 and 1,877,970 shares at December 31, 2022 respectively

Additional paid-in capital

Accumulated deficit

stockholders’ equity

liabilities and stockholders’ equity

( 91,323,279 )

( 74,834,854 )

Total stockholders’ equity

Total liabilities and stockholders’ equity

accompanying notes to condensed consolidated financial statements.

1 unchanged sentence

Consolidated Statements of Operations

Three Months Ended

Three Months Ended September 30,

Nine Months Ended September 30,

Cost of goods sold

( 2,997,909 )

Operating expenses:

6 unchanged sentences

( 3,952,540 )

( 16,107,331 )

( 10,692,812 )

Other expense:

4 unchanged sentences

( 4,046,273 )

Income tax provision

( 16,463,974 )

( 10,954,614 )

Basic and diluted net loss per share

Weighted average common and common equivalent shares:

Income taxes (benefit)

$ ( 6,820,287 )

$ ( 4,062,580 )

$ ( 16,488,425 )

$ ( 11,027,640 )

Net loss per share:

Basic and diluted

Basic and diluted weighted average common and common equivalent shares

accompanying notes to condensed consolidated financial statements.

1 unchanged sentence

Consolidated Statements of Stockholders’ Equity

the three months ended March 31, 2023

the nine months ended September 30, 2023

Balance at December 31, 2022

6 unchanged sentences

( 78,905,311 )

the three months ended March 31, 2022

( 5,597,681 )

Common stock issued for vested restricted stock units

Stock-based compensation

Balance at June 30, 2023

$ ( 84,502,992 )

( 6,820,287 )

Common stock issued for vested restricted stock units

Stock-based compensation

Balance at September 30, 2023

$ ( 91,323,279 )

the nine months ended September 30, 2022

Balance at December 31, 2021

6 unchanged sentences

$ ( 61,824,110 )

( 4,426,559 )

Stock option exercises, net

Stock-based compensation

Balance at June 30, 2022

$ ( 66,250,669 )

( 4,062,580 )

Common stock issued for vested restricted stock units

Stock-based compensation

Balance at September 30, 2022

$ ( 70,313,249 )

accompanying notes to condensed consolidated financial statements.

1 unchanged sentence

Consolidated Statements of Cash Flows

Three Months Ended March 31,

Nine Months Ended September 30,

Cash flows used in operating activities:

1 unchanged sentence

$ ( 11,027,640 )

Adjustments to reconcile net loss to net cash

used in operating activities:

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

Depreciation and amortization

3 unchanged sentences

Stock based compensation

Provision for accounts receivable allowances

Provision for inventory reserves

Provision (recovery) for accounts receivable allowances

Provision for inventory valuation adjustment

Changes in operating assets and liabilities:

Accounts receivable

( 1,428,785 )

Prepaid expenses and other current assets

2 unchanged sentences

Accrued expenses

( 3,041,742 )

Deferred revenue

7 unchanged sentences

Cash flows from financing activities:

Net proceeds from the bank credit line

Net proceeds from (payment on) the bank credit line

( 3,891,682 )

Repayment of government loan

Proceeds from stock option exercises

Net cash provided by financing activities

Net cash provided by (used in) financing activities

( 3,891,682 )

Net increase (decrease) in cash and cash equivalents

4 unchanged sentences

Cash paid during the period for:

Cash is reported on the condensed consolidated statements of cash flows as follows:

Cash is reported on the consolidated statements of cash flows as follows:

Cash and cash equivalents

37 unchanged sentences

None of the reclassifications impacted the condensed

consolidated statements of operations for the three- month period ended March 31, 2023.

consolidated statements of operations for the three-months and nine months ended September 30, 2023.

April 17, 2023, the Company effected a 25:1 reverse stock split for each share of common stock issued and outstanding.

4 unchanged sentences

Company has incurred significant losses and negative cash flows from operations.

During the three months ended March 31, 2023, the Company

incurred a net loss of $ 4.0 million and had positive cash flows from operating activities of $ 1.3 million.

As of March 31, 2023, the

Company had an accumulated deficit of $ 78.9 million and cash and cash equivalents of $ 0.8 million.

The Company implemented cost reduction

plans to align its cost structure to its sales and increase its liquidity.

The Company will continue to monitor its cost in relation

to its sales and adjust its cost structure accordingly.

The Company’s financial position

and operating results raise substantial doubt about the Company’s ability to continue as a going concern.

The Company believes

it does not have sufficient resources through its cash and cash equivalents, other working capital and borrowings under its SVB line-of-credit

to continue as a going concern through at least one year from the issuance of these financial statements.

During the nine months ended September 30, 2023, the

Company incurred a net loss of $ 16.5 million and had positive cash flows from operating activities of $ 3.7 million.

As of September 30,

2023, the Company had an accumulated deficit of $ 91.3 million and cash and cash equivalents of $ 0.5 million.

The Company implemented

cost reduction plans to align its cost structure to its sales and increase its liquidity.

The Company will continue to monitor its cost

in relation to its sales and adjust its cost structure accordingly.

The Company’s financial position and operating results raise

substantial doubt about the Company’s ability to continue as a going concern.

The Company believes it does not have sufficient

resources through its cash and cash equivalents, other working capital and borrowings under its SVB line-of-credit to continue as a going

concern through at least one year from the issuance of these financial statements.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Company’s significant accounting policies are disclosed in its Annual Report on Form 10-K for the year ended December 31, 2022.

The Company’s significant accounting policies did not change during the three months ended March 31, 2023.

The Company’s significant accounting policies did not change during the nine months ended September 30, 2023.

Issued Accounting Standards

43 unchanged sentences

SCHEDULE OF CONTRACT BALANCES

September 30,

Deferred revenue, current

Deferred revenue, noncurrent

the three months ended March 31, 2023, the change in contract balances was as follows:

the nine months ended September 30, 2023, the change in contract balances was as follows:

SCHEDULE OF CHANGE IN CONTRACT BALANCES

1 unchanged sentence

Revenue recognized

Balance at March 31, 2023

Balance at September 30, 2023

Disaggregation

1 unchanged sentence

SCHEDULE OF DISAGGREGATION OF REVENUE BY DISTRIBUTION CHANNEL

Three Months Ended March 31,

Three Months Ended September 30,

Nine Months Ended September 30,

following table sets forth our revenues by product:

Three Months Ended March 31,

Three Months Ended September 30,

Nine Months Ended September 30,

Cable modems & gateways

5 unchanged sentences

Finished goods

goods includes consigned inventory held by our customers of $ 3.6 million and $ 4.2 million at March 31, 2023 and December 31, 2022, respectively,

and includes $ 0 in-transit inventory at March 31, 2023 and December 31, 2022, respectively.

The Company reviews inventory for obsolete

and slow-moving products each quarter and makes provisions based on its estimate of the probability that the material will not be consumed

or that it will be sold below cost.

The inventory reserves were $ 2.5 million and $ 2.5 million as of March 31, 2023 and December 31, 2022,

goods includes consigned inventory held by our customers of $ 0 million and $ 4.2 million at September 30, 2023 and December 31, 2022,

respectively.

The Company reviews inventory for obsolete and slow-moving products each quarter and makes provisions based on its estimate

of the probability that the material will not be consumed or that it will be sold below cost.

The inventory reserves were $ 1.6 million

and $ 2.5 million as of September 30, 2023 and December 31, 2022, respectively.

expenses consist of the following:

33 unchanged sentences

Amortization of debt issuance costs

was $ 15 thousand and $ 18 thousand for the three months ended March 31, 2023 and 2022, respectively.

of March 31, 2023, the Company had $ 3.8 million outstanding, net of origination costs of $ 15 thousand, under the SVB Loan Agreement,

was $ 8 thousand and $ 18 thousand for the three months ended September 30, 2023 and 2022, respectively.

Amortization of debt issuance

costs was $ 29 thousand and $ 53 thousand for the nine months ended September 30, 2023 and 2022, respectively.

of September 30, 2023, the Company had $ 0.9 million outstanding, net of origination costs of $ 0 thousand, under the SVB Loan Agreement,

and this credit line had availability of $ 0 thousand.

interest rate on the bank credit lines was 9.00 % as of March 31, 2023.

interest rate on the bank credit lines was 9.5 % as of September 30, 2023.

March 10, 2023, Silicon Valley Bank went into receivership with the Federal Deposit Insurance Corporation (FDIC) and is now the Silicon

5 unchanged sentences

The Company has had no business service interruptions or funding issues due to the bank transfer.

October 18, 2023, the Company fully paid the $ 0.9 million outstanding balance and accrued interest, and the SVB Loan Agreement was immediately

SVB Loan Agreement includes a minimum interest expense per month of $ 20 thousand.

26 unchanged sentences

with the Senior Lender is paid in full in cash on an earlier date.

As of March 31, 2023, the accrued interest is $ 33 thousand and is

included in accrued expenses in the condensed consolidated balance sheet.

As of September 30, 2023, the accrued interest is $ 104 thousand and

is included in accrued expenses in the condensed consolidated balance sheet.

Company reimbursed Slingshot Capital $ 20,000 for its reasonable and documented expenses and fees related to the negotiations, documentation,

1 unchanged sentence

Capital is owned by the Company’s Chairperson of the Board and a Board of Director, Jeremy Hitchcock and Elizabeth Hitchcock, respectively.

December 6, 2023, the Company and Slingshot Capital executed a debt conversion agreement, whereby the total outstanding principal

and accrued but interest, which aggregated to $ 1,125,778 ,

was converted to 734,343

common stock of the Company.

Upon the execution of the debt conversion agreement and issuance of the common stock, the Bridge Loan

Agreement and Bridge Term Note were terminated.

2020, the Company participated in the Coronavirus Aid, Relief, and Economic Security Act and received an aggregate $ 1,128,000 in unsecured

2 unchanged sentences

the Company received forgiveness of an aggregate $ 1,068,000 .

The Company repaid $ 30,000 during the three months ended March 31, 2022

and had $ 4,000 of an outstanding balance as of March 31, 2022.

The Company fully repaid the remaining $ 4,000 balance as of April 30,

As of March 31, 2023, the Company had no outstanding balances under the government loans.

The Company repaid $ 34,000 during the nine months ended September 30, 2022.

As of September 30, 2023, the Company had no outstanding balances under the government loans.

Company has entered into agreements to lease its warehouses and distribution centers and certain office space under operating leases.

4 unchanged sentences

SCHEDULE OF COMPONENTS OF LEASE COSTS

Three Months ended March 31,

Three Months Ended September 30,

Nine Months Ended September 30,

Operating lease costs

3 unchanged sentences

SCHEDULE OF WEIGHTED AVERAGE REMAINING LEASE TERM AND DISCOUNT RATE

Period Ended March 31,

Period Ended September 30,

Operating leases:

3 unchanged sentences

SCHEDULE OF SUPPLEMENTAL CASH FLOW INFORMATION RELATED TO OPERATING LEASES

Three Months ended March 31,

Nine Months ended September 30,

Operating cash flow information:

2 unchanged sentences

ROU asset obtained in exchange for lease liability

maturity of the Company’s operating lease liabilities as of March 31, 2023 were as follows:

maturity of the Company’s operating lease liabilities as of September 30, 2023 were as follows:

SCHEDULE OF MATURITY OF OPERATING LEASE LIABILITIES

19 unchanged sentences

2023 (remaining)

expense under the License Agreement was $ 1.7 million and $ 1.6 million for the three months ended March 31, 2023 and 2022, respectively

and is included in selling and marketing expenses on the accompanying condensed consolidated statements of operations.

As of March 31,

2023 and March 31, 2022, the Company had $ 2.7 million and $ 1.6 million, respectively, outstanding in royalty payments and are included

in accounts payable ($ 1.0 million and $ 0 million, respectively) and accrued expenses ($ 1.7 million and $ 1.6 million, respectively) in

the condensed consolidated balance sheets.

expense under the License Agreement was $ 1.7 million and $ 1.7 million for the three months ended September 30, 2023 and 2022, respectively,

and $ 5.1 million and $ 5.0 million for the nine months ended September 30, 2023 and 2022, respectively.

Royalty expense is included in

selling and marketing expenses on the accompanying condensed consolidated statements of operations.

As of September 30, 2023 and September

30, 2022, the Company had $ 6.1 million and $ 1.7 million, respectively, outstanding in royalty payments and are included in accounts payable

($ 6.1 million and $ 0 million, respectively) and accrued expenses ($ 0.0 million and $ 1.7 million, respectively) in the condensed consolidated

balance sheets.

Contingencies

11 unchanged sentences

the estimate of the amount of the loss or range of losses, that the amount is not material, or that an estimate of the loss cannot be

At March 31, 2023, the Company is not currently a party to any legal proceedings that, if determined adversely to the Company,

At September 30, 2023, the Company is not currently a party to any legal proceedings that, if determined adversely to the Company,

in management’s opinion, are currently expected to individually or in the aggregate have a material adverse effect on the Company’s

13 unchanged sentences

few companies account for a substantial portion of the Company’s revenues.

In the three months ended March 31, 2023, two companies,

In the three months ended September 30, 2023, two companies,

including a marketplace facilitator, accounted for 10% or greater individually and 80 % in the aggregate of the Company’s total

At March 31, 2023, two companies with an accounts receivable balance of 10% or greater individually accounted for a combined

At September 30, 2023, two companies with an accounts receivable balance of 10% or greater individually accounted for a combined

87 % of the Company’s accounts receivable.

In the three months ended March 31, 2022, two companies, including a marketplace facilitator,

accounted for 10% or greater individually and 90 % in the aggregate of the Company’s total net sales.

At March 31, 2022, two companies

with an accounts receivable balance of 10% or greater individually accounted for a combined 88 % of the Company’s accounts receivable.

In the three months ended September 30, 2022, two companies, including a marketplace

facilitator, accounted for 10% or greater individually and 87 % in the aggregate of the Company’s total net sales.

30, 2022, three companies with an accounts receivable balance of 10% or greater individually accounted for a combined 91 % of the Company’s

accounts receivable.

Company’s customers generally do not enter into long-term agreements obligating them to purchase products.

19 unchanged sentences

During the three months ended

March 31, 2023 and 2022, the Company had one supplier and two suppliers, respectively, that provided 90 % and 99 %, respectively, of the

Company’s purchased inventory.

the three months ended March 31, 2023, we recorded no income tax benefits for the net operating losses incurred or for the research and

development tax credits generated due to the uncertainty of realizing a benefit from those items.

September 30, 2023 and 2022, the Company had one supplier and two suppliers, respectively, that provided 100 % and 91 %, respectively,

of the Company’s purchased inventory.

the three and nine months ended September 30, 2023, we recorded no income tax benefits for the net operating losses incurred or for the

research and development tax credits generated due to the uncertainty of realizing a benefit from those items.

have evaluated the positive and negative evidence bearing upon the Company’s ability to realize its deferred tax assets, which

3 unchanged sentences

than not that we will not realize the benefits of our deferred tax assets.

As a result, as of March 31, 2023 and December 31, 2022, we

recorded a full valuation allowance against our net deferred tax assets.

of March 31, 2023 and December 31, 2022, the Company had federal net operating loss carry forwards of approximately $ 57.9 million and

$ 60.6 million, respectively, which are available to offset future taxable income.

As a result, as of September 30, 2023 and December 31, 2022,

we recorded a full valuation allowance against our net deferred tax assets.

of September 30, 2023 and December 31, 2022, the Company had federal net operating loss carry forwards of approximately $ 62.0 million

and $ 60.6 million, respectively, which are available to offset future taxable income.

They are due to expire in varying amounts from

2023 to 2041.

Federal net operating losses occurring after December 31, 2017, of approximated $ 27.6 million may be carried forward indefinitely.

As of March 31, 2023 and December 31, 2023, the Company had state net operating loss carry forwards of approximately $ 31.6 million and

$ 29.8 million, respectively, which are available to offset future taxable income.

As of September 30, 2023 and December 31, 2022, the Company had state net operating loss carry forwards of approximately $ 37.3 million

and $ 29.8 million, respectively, which are available to offset future taxable income.

They are due to expire in varying amounts from

1 unchanged sentence

We recorded minimum state income taxes and taxes related to our operations in Mexico.

For the three months ended March

31, 2023 and 2022, income tax expense was $ 6 thousand and $ 6 thousand, respectively.

For the three months ended September

30, 2023 and 2022, income tax benefit was $ 1 thousand and income tax expense was $ 16 thousand, respectively.

RELATED PARTY TRANSACTIONS

4 unchanged sentences

The facility lease agreement provides for 2,656 square feet.

For the three-months period ended March 31, 2023 and 2022, the rent expense

For the three-months period ended September 30, 2023 and 2022, the rent

expense was $ 9 thousand and $ 8 thousand, respectively.

For the nine-months period ended September 30, 2023 and 2022, the rent expense

was $ 27 thousand and $ 24 thousand, respectively.

10 unchanged sentences

Board became the acting principal executive officer of the Company.

See additional information in the Company’s Subsequent Events

December 6, 2023, the Company and Slingshot Capital executed a debt conversion agreement, whereby the total outstanding principal

and accrued but interest, which aggregated to $ 1,125,778 ,

was converted to 734,343

common stock of the Company.

Upon the execution of the debt conversion agreement and issuance of the common stock, the Bridge Loan

Agreement and Bridge Term Note were terminated.

EARNINGS (LOSS) PER SHARE

loss per share for the three months ended March 31, 2023 and 2022, respectively, are as follows:

loss per share for the three months ended September 30, 2023 and 2022, respectively, are as follows:

SCHEDULE OF NET INCOME (LOSS) PER SHARE

Three Months ended March 31,

September 30, 2023

September 30, 2022

September 30, 2023

September 30, 2022

Three Months Ended

Nine Months Ended

September 30, 2023

September 30, 2022

September 30, 2023

September 30, 2022

$ ( 6,820,287 )

$ ( 4,062,580 )

$ ( 16,488,425 )

$ ( 11,027,640 )

Weighted average common shares - basic

1 unchanged sentence

Weighted average common shares - dilutive

Basic and diluted net loss per share

loss per common share for the three months ended March 31, 2023 and 2022 excludes the effects of 49,402 and 9,981 common share equivalents,

respectively, since such inclusion would be anti-dilutive.

The common share equivalents consist of shares of common stock issuable upon

exercise of outstanding stock options.

SUBSEQUENT EVENTS

Basic and diluted

loss per common share for the three and nine months ended September 30, 2023 and 2022 excludes the effects of 2,080 and 1,257,581 common

share equivalents, respectively, since such inclusion would be anti-dilutive.

The common share equivalents consist of shares of common

stock issuable upon exercise of outstanding stock options.

REVERSE STOCK SPLIT

March 30, 2023, the Board of Directors of Minim, Inc.

18 unchanged sentences

awards exercisable into common stock in these consolidated financial statements have been adjusted, on a retroactive basis, to reflect

the reverse stock split in quarter ending March 31, 2023.

the reverse stock split in quarter ending September 30, 2023.

following unaudited pro forma selected financial information reflects the impact of the reverse stock split had the effective date of

13 unchanged sentences

Basic and diluted

SUBSEQUENT EVENTS

letter of intent that may result in the Company being acquired

9 unchanged sentences

will be completed.

Company has evaluated subsequent events from March 31, 2023 through the date of this filing and has determined that there are no such

events, other than those noted above, requiring recognition or disclosure in the financial statements.

of SVB Loan Agreement

October 18, 2023, the Company fully paid the $ 0.9 million outstanding balance and accrued interest on its revolving facility under the

SVB Loan Agreement, which was immediately terminated upon full repayment.

Company has evaluated subsequent events from September 30, 2023 through the date of this filing and has determined that there are no

such events, other than those noted above, requiring recognition or disclosure in the financial statements.

of Bridge Loan Agreement

December 6, 2023, the Company and Slingshot Capital executed a debt conversion agreement, whereby the total outstanding principal and

accrued but interest, which aggregated to $ 1,125,778 , was converted to 734,343 common stock of the Company.

Upon the execution of the

debt conversion agreement and issuance of the common stock, the Bridge Loan Agreement and Bridge Term Note were terminated.

its efforts to manage its liquidity and cash-flow position, the Company negotiated and executed liability release agreements with certain

vendors in Q4 2023.

In aggregate, the executed release agreements resulted in a reduction of outstanding accounts payable obligations

by $ 3.0 million.

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