What changed in this filing

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Item 1. Financial Statements

2024-05-06 compared with 2023-11-09 · 191 added, 168 removed, 389 unchanged (48% of the section changed)

4 unchanged sentences

(In thousands, except par value)

September 30,

Current Assets:

12 unchanged sentences

Accrued expenses and other current liabilities

Long-term debt due within one year

Debt due within one year

Total current liabilities

20 unchanged sentences

Three Months Ended

Nine Months Ended

September 30,

Cost of sales

7 unchanged sentences

Interest income, net

Other income, net

Other income (expense), net

Total other income, net

16 unchanged sentences

Restricted stock units vested and distributed

Balance, April 1, 2023

Issuance of common stock, net

Exercise of stock options

Stock-based compensation

Restricted stock units vested and distributed

Balance, July 1, 2023

Issuance of common stock, net

Exercise of stock options

Stock-based compensation

Restricted stock units vested and distributed

Balance, September 30, 2023

See accompanying Notes to the Condensed Consolidated Statements.

NETLIST, INC.

AND SUBSIDIARIES

Condensed Consolidated Statements of Stockholders Equity (Unaudited) (Continued)

(In thousands)

Tax withholdings related to net share settlements of equity awards

Balance, March 30, 2024

Stockholders'

Balance, January 1, 2022

Balance, December 31, 2022

Issuance of common stock, net

2 unchanged sentences

Restricted stock units vested and distributed

Tax withholdings related to net share settlements of equity awards

Balance, April 1, 2023

Issuance of common stock, net

Exercise of stock options

Stock-based compensation

Restricted stock units vested and distributed

Tax withholdings related to net share settlements of equity awards

Balance, July 2, 2022

Exercise of stock options

Stock-based compensation

Restricted stock units vested and distributed

Tax withholdings related to net share settlements of equity awards

Balance, October 1, 2022

See accompanying Notes to the Condensed Consolidated Statements.

3 unchanged sentences

(In thousands)

Nine Months Ended

September 30,

Three Months Ended

Cash flows from operating activities:

18 unchanged sentences

Proceeds from issuance of common stock, net

Proceeds from exercise of stock options

Proceeds from exercise of stock options and warrants

Payments for taxes related to net share settlement of equity awards

14 unchanged sentences

and its wholly owned subsidiaries (collectively the “Company,” “Netlist,” “we,” “us,” or “our”) provides high-performance memory solutions to enterprise customers in diverse industries.

Our products in various capacities and form factors and our line of custom and specialty memory products bring leading performance to customers in a variety of industries globally and cloud service providers.

Our products, in various capacities and form factors, including our line of custom and specialty memory products, bring leading performance to customers in a variety of industries globally.

Netlist also licenses its intellectual property.

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GAAP have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”).

These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto as of and for the year ended December 31, 2022, included in the Company’s Annual Report on Form 10-K filed with the SEC on February 28, 2023 (the “2022 Annual Report”).

These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto as of and for the year ended December 30, 2023, included in the Company’s Annual Report on Form 10-K filed with the SEC on February 23, 2024.

In the opinion of management, all adjustments for the fair presentation of the Company’s condensed consolidated financial statements have been made.

1 unchanged sentence

The results of operations for the interim periods are not necessarily indicative of the results to be expected for other periods or the full fiscal year.

The Company has evaluated events occurring subsequent to September 30, 2023 through the filing date of this Quarterly Report on Form 10-Q and concluded that there were no events that required recognition and disclosures other than those discussed elsewhere in the notes hereto.

The Company has evaluated events occurring subsequent to March 30, 2024 through the filing date of this Quarterly Report on Form 10-Q and concluded that there were no events that required recognition and disclosures other than those discussed elsewhere in the notes hereto.

Principles of Consolidation

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Actual results may differ materially from those estimates.

Recently Adopted Accounting Guidance

Currently, there are no Accounting Standards Updates that the Company is required to adopt that are likely to have a material effect on its consolidated financial statements that have not been previously discussed in the Company's 2022 Annual Report.

Recently Issued Accounting Standards

In December 2023, the FASB issued Update 2023-09, “Income Taxes (Topic 740):

Improvements to Income Tax Disclosures.” This update applies to all entities that are subject to Topic 740.

The amendments in this update improve income tax disclosures primarily related to the rate reconciliation and income taxes paid information as well as the effectiveness of certain other income tax disclosures.

The new standard is effective for annual periods beginning after December 15, 2024.

Early adoption is permitted.

This standard should be applied on a prospective basis, but retrospective application is permitted.

The Company is currently evaluating the impact of adopting this new standard.

Note 3—Supplemental Financial Information

Inventories consisted of the following (in thousands):

September 30,

Raw materials

4 unchanged sentences

Three Months Ended

Nine Months Ended

September 30,

Weighted-average basic shares outstanding - basic and diluted

3 unchanged sentences

Three Months Ended

Nine Months Ended

September 30,

Weighted average common share equivalents

2 unchanged sentences

Three Months Ended

Nine Months Ended

September 30,

Resales of third-party products

5 unchanged sentences

Three Months Ended

Nine Months Ended

September 30,

Less than 10% of net sales during the period.

As of September 30, 2023, two customers represented approximately 31 % and 25 % of aggregated gross accounts receivables, respectively.

As of December 31, 2022, one customer represented approximately 69 % of aggregate gross accounts receivables.

As of March 30, 2024, two customers represented approximately 54 % and 19 % of aggregated gross accounts receivables, respectively.

As of December 30, 2023, two customers represented approximately 60 % and 10 %, respectively, of aggregate gross accounts receivables.

The loss of a major customer or a reduction in sales to or difficulties collecting payments from these customers could significantly reduce the Company’s net sales and adversely affect its operating results.

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The Company resells certain component products to end-customers that are not reached in the distribution models of the component manufacturers, including storage customers, appliance customers, system builders and cloud and datacenter customers.

For both the three and nine months ended September 30, 2023, resales of these products represented approximately 82 % of net product sales.

For the three and nine months ended October 1, 2022, resales of these products represented approximately 75 % and 86 % of net product sales, respectively.

Note 4—Standby Letters of Credit

For the three months ended March 30, 2024 and April 1, 2023, resales of these products represented approximately 87 % and 77 % of net product sales, respectively.

Note 4—Credit Agreement and Standby Letters of Credit

2023 SVB Credit Agreement

On November 7, 2023, we entered into a loan and security agreement (the “2023 SVB Credit Agreement”) with Silicon Valley Bank, a division of First-Citizen Bank & Trust Company (“SVB”), which provides for a revolving line of credit up to $ 10.0 million.

The borrowing base is limited to 85 % of eligible accounts receivable, subject to certain adjustments.

Borrowings accrue interest on advance at a per annum rate equal to the greater of 8.50 % and the Prime Rate.

The maturity date is November 7, 2025.

The 2023 SVB Credit Agreement requires letters of credit to be secured by cash, which is classified as restricted cash in the accompanying consolidated balance sheets.

As of March 30, 2024 and December 30, 2023, (i) outstanding letters of credit and restricted cash were $ 12.4 million and $ 12.4 million, respectively, (ii) outstanding borrowings were $ 4.4 million and $ 3.8 million, respectively, and (iii) availability under the revolving line of credit was $ 0 and $ 0 , respectively.

As of March 30, 2024, all obligations under the 2023 SVB Credit Agreement were secured by a first priority security interest in our tangible and intangible assets.

The 2023 SVB Credit Agreement subjects us to certain affirmative and negative covenants, including financial covenants with respect to our liquidity and restrictions on the payment of dividends.

As of March 30, 2024, we were in compliance with our covenants under the 2023 SVB Credit Agreement.

Standby Letters of Credit

On December 1, 2022, Silicon Valley Bank issued on our behalf to a third party an irrevocable letter of credit in the amount of $ 100,000 .

On May 15, 2023 and June 6, 2023, Citibank, N.A.

issued on the Company’s behalf to third parties irrevocable letters of credit in the amount of $ 5.0 million and $ 2.0 million, respectively.

The standby letters of credit are valid for a one-year term.

As of September 30, 2023, the amount of outstanding letters of credit was approximately $ 7.1 million, and no amount has been drawn from the letters of credit.

As of March 30, 2024, the amount of outstanding letters of credit was approximately $ 12.2 million, consisting of an irrevocable letter of credit issued by SVB on our behalf to a third party expiring on December 31, 2024, and two irrevocable letters of credit issued by Citibank, N.A.

on our behalf to third parties expiring on May 15, 2025 and June 6, 2025, respectively.

As of March 30, 2024, no amount has been drawn from the letters of credit.

A standby letter of credit is a guarantee of payment issued by a bank on our behalf that is used as payment of last resort should we fail to fulfill a contractual commitment with a third party.

The Company’s debt consisted of the following (in thousands):

September 30,

Notes payable

2 unchanged sentences

Insurance Policy Finance Agreement

As of December 31, 2022, we had $ 0.4 million in short-term notes payable for the financing of insurance policies.

As of March 30, 2024 and December 30, 2023, we had $ 0.4 million and $0, respectively, in short-term notes payable for the financing of insurance policies.

On January 23, 2024, we entered into a short-term note payable for $ 0.5 million bearing interest at 8.42 % to finance insurance policies.

Principal and interest payments on this note began January 15, 2023 and were made evenly based on a straight line amortization over a 9-month period with the final payment made on September 15, 2023.

As a result, as of September 30, 2023, there was no outstanding balance for the financing of insurance policies.

Principal and interest payments on this note began on February 15, 2024 and are made evenly based on a straight line amortization over an 8-month period.

Note 6—Leases

3 unchanged sentences

Three Months Ended

Nine Months Ended

September 30,

Operating lease cost

1 unchanged sentence

Operating cash flows from operating leases

Operating cash flows from finance leases

Financing cash flows from finance leases

Right-of-use assets obtained in exchange for lease obligations:

Operating leases

Finance leases

Lease modification to increase operating lease assets

For the three and nine months ended September 30, 2023 and October 1, 2022, finance lease costs were immaterial.

For the three months ended March 30, 2024 and April 1, 2023, finance lease costs and cash flows from finance leases were immaterial.

Supplemental condensed consolidated balance sheet information related to leases was as follows (in thousands):

September 30,

Operating Leases

11 unchanged sentences

The following table includes supplemental information:

September 30,

Weighted Average Remaining Lease Term (in years)

4 unchanged sentences

Finance leases

Maturities of lease liabilities as of September 30, 2023, were as follows (in thousands):

Maturities of lease liabilities as of March 30, 2024, were as follows (in thousands):

2024 (remainder of the year)

26 unchanged sentences

2:22-cv-00293-JRG).

On July 26, 2022, Netlist filed patent infringement claims against Google Cloud EMEA Limited, Google Germany GmbH, Redtec Computing GmbH, and Google, seeking damages based on those defendants’ infringement of European Patents EP 2,454,735 (“EP735”) and EP 3,404,660 (“EP660”), which both generally relate to load reduced dual in line memory modules (“LRDIMM”) technologies.

As of the reporting date, Google has submitted its statements of defense.

As of the reporting date, the date for oral hearings before the Dusseldorf Court is currently scheduled for April 11, 2024.

On October 15, 2021, Samsung Electronics Co., Ltd.

(“SEC”) and Samsung Semiconductor Inc.

On July 26, 2022, Netlist filed patent infringement claims against Google Cloud EMEA Limited, Google Germany GmbH, Redtec Computing GmbH, and Google LLC (the “German Google Defendants”), seeking damages based on those defendants’ infringement of European Patents EP 2,454,735 (“EP735”) and EP 3,404,660 (“EP660”), which both generally relate to load reduced dual in line memory modules (“LRDIMM”) technologies.

As of the reporting date, the German Google Defendants have submitted statements of defense.

As of the reporting date, the German Federal patent Court has issued its order finding the EP735 null, and the proceedings before the Dusseldorf Court are currently stayed pending the outcome of the nullity reviews of the asserted EP patents.

On October 15, 2021, Samsung Electronics Co.

(“SECL”) and Samsung Semiconductor Inc.

(“SSI”) initiated a declaratory judgement action against Netlist in the U.S.

3 unchanged sentences

1:21-cv-01453-RGA).

On September 12, 2022, Netlist amended its Counterclaims to include counterclaims against Google, LLC and Alphabet, Inc (together, “Google”).

On November 15, 2022, Google responded to Netlist’s Counterclaims by filing a Motion to Dismiss or alternatively to sever and stay the counterclaims.

As of the reporting date, the Court heard oral arguments for Google’s Motion to Dismiss or alternatively, Sever and Stay and Dismiss Willfulness and Indirect Infringement Allegations.

On October 10, 2023, the DDE Court entered an order granting-in-part and denying-in-part SECL and SSI’s prior motion to stay the matter in light of pending IPRs and a Ninth Circuit appeal, in effect staying claims with respect to the ‘218 and ‘595 patents, while allowing claims under the ‘523 patent to proceed.

On September 12, 2022, Netlist amended its Counterclaims to include counterclaims against Google LLC and Alphabet, Inc (together, “Google Delaware Defendants”).

On November 15, 2022, the Google Delaware Defendants responded to Netlist’s Counterclaims by filing a Motion to Dismiss or alternatively to sever and stay the counterclaims.

As of the reporting date, the Court heard oral arguments for the Google Delaware Defendants’ Motion to Dismiss or alternatively, Sever and Stay and Dismiss Willfulness and Indirect Infringement Allegations.

On October 10, 2023, the DDE Court entered an order granting-in-part and denying-in-part SECL and SSI’s prior motion to stay the matter in light of pending Inter Partes Reviews (“IPRs”) and a Ninth Circuit appeal, in effect staying claims with respect to Netlist’s U.S.

9,858,218 (the “‘218 Patent”) and 10,474,595 (the “‘595 Patent”), while allowing claims under Netlist’s U.S.

10,217,523 (the “‘523 Patent”) to proceed.

On October 20, 2023, the Court held a claim construction hearing involving all parties.

As part of the hearing, the Court also sought feedback from parties as to the issue of whether the matter should be stayed pending review of the Ninth Circuit’s recent unpublished decision on the underlying Central District of California action.

As of the reporting date, the case remains set for Jury Trial to commence on February 3, 2025.

On December 1, 2023, the Court entered an Oral Order staying the matter until the development of any action by any other court pertaining to Samsung’s and Netlist’s rights under the JDLA that may merit lifting the stay.

As of the reporting date, the case remains stayed.

Micron Litigations

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(“Micron”) in the U.S.

District Court for the Western District of Texas, Waco Division (“WDTX”) (Case No.

District Court for the Western District of Texas (“WDTX”), Waco Division (Case No.

6:21-cv00431 & Case No.

3 unchanged sentences

10,489,314 (the “‘314 Patent”), 9,824,035 (the “‘035 Patent”), 10,268,608 (the “‘608 Patent”), and 8,301,833 (the “‘833 Patent”).

The case was assigned to Hon.

Judge Lee Yeakel, and the parties completed briefing on their claim construction arguments.

On May 11, 2022, Judge Yeakel entered a stay of the case pending the resolution of Micron’s requested Inter Partes Review (“IPR”) proceedings against the four patents asserted by Netlist in this case (the ‘833, ‘035, ‘608, and ‘314 Patents).

On May 4, 2023, the case was reassigned to Docket II in the WDTX Austin Division, given Hon.

The consolidated case was assigned to Hon.

Judge Lee Yeakel (new Case No.

1:22-cv-00134, and 1:22-cv-00136), and the parties have completed briefing on their claim construction arguments.

On May 11, 2022, Judge Yeakel entered a stay of the case pending the resolution of Micron’s requested IPR proceedings against the four patents asserted by Netlist in these consolidated cases (the ‘833, ‘035, ‘608, and ‘314 Patents).

On May 4, 2023, the consolidated cases were reassigned to Docket II in the WDTX Austin Division, given Hon.

Judge Yeakel’s retirement.

As of the reporting date, the matter remains and assigned to Docket II pending reassignment to an Article III Judge.

On February 21, 2024, the parties have filed a status report with Austin District Court Judge Robert Pitman.

On April 19, 2024, Netlist filed a motion to transfer the matter to the Eastern District of Texas, Marshall Division.

As of the reporting date, the matter remains assigned to Judicial Docket II of the WDTX, Austin Division Court pending briefing and a decision on Netlist’s motion.

As noted above, Micron filed requests to bring IPR proceedings against Netlist’s ‘314, ‘035, ‘608, and ‘833 Patents.

The PTAB granted Micron’s request for the ‘035, ‘833, and ‘314 Patents, but denied its request for the ‘608 Patent.

The PTAB granted Micron’s request for the ‘035, ‘833, and ‘314 Patents, but denied its request for instituting an IPR trial for the ‘608 Patent.

The PTAB further denied Micron’s request for rehearing on the ‘608 Patent’s institution denial.

2 unchanged sentences

On October 30, 2023, the PTAB determined that all challenged claims of the ‘314 Patent were patentable.

On December 29, 2023, Micron filed a Notice of Appeal for the ‘314 Patent IPR decisions, indicating its intent to challenge the PTAB’s validity findings at the United States Court of Appeals for the Federal Circuit.

As of the reporting date, Micron has not yet submitted its opening appeal brief.

On March 31, 2022, Netlist filed patent infringement claims against Micron in Dusseldorf, Germany (“Micron Dusseldorf Action”), seeking damages based on their infringement of EP735 and EP660.

2 unchanged sentences

Primary briefing in the Micron Dusseldorf Action has concluded, while the German Federal Patent Court entered a preliminary opinion on EP735 and EP660 in a related invalidity proceedings that have been consolidated as of the reporting date.

As of the reporting date, the Micron Dusseldorf Action is scheduled for oral hearings April 11, 2024.

As of the reporting date, the German Federal patent Court has issued its order finding the EP735 null, and the Micron Dusseldorf Action has been stayed pending the outcome of the nullity reviews of the asserted EP patents.

On June 10, 2022, Netlist filed a complaint for patent infringement against Micron in the EDTX, Marshall Division (Case No.

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Magistrate Judge Roy Payne on July 26, 2023, and on October 30, 3023 the Court entered an Order confirming the Claim Construction outcome.

The Jury Trial is scheduled to begin on January 22, 2024.

The Jury Trial was initially scheduled to begin on January 22, 2024, but as of the reporting date, the Court has stayed the matter.

On August 1, 2022, Netlist filed a complaint for patent infringement against Micron in the EDTX (Case No.

3 unchanged sentences

On October 21, 2022, Hon.

Chief Judge Gilstrap ordered that this Micron action and a parallel action by Netlist against defendants Samsung on the same patents (Case No.

Chief Judge Gilstrap

ordered that this Micron action and a parallel action by Netlist against defendants Samsung on the same patents (Case No.

2:22-cv-00293-JRG) be consolidated and set for a joint scheduling conference on November 17, 2022, further instructing that the Samsung action be considered the “LEAD CASE” and that any further filings from either action be submitted in that case for all pretrial matters.

1 unchanged sentence

Chief Judge Gilstrap on September 26, 2023.

As of the reporting date, the Court has not yet entered an Order confirming the Claim Construction outcomes, but the consolidated case has a docket control order listing trial beginning on April 15, 2024.

On November 21, 2023, the Court entered its Claim Construction Order.

The Court held the final pretrial conference for the consolidated case on March 6, 2024.

As of the reporting date, the case is scheduled for a jury trial starting on May 20, 2024.

On November 18, 2022, Micron filed IPR requests contesting the validity of the ‘912, ‘339, and ‘506 Patents, along with motions requesting joinder to the pending Samsung IPRs related to the same patents (see below).

3 unchanged sentences

On October 17, 2023 and October 18, 2023, the PTAB issued final written decisions stating that all challenged claims of the ‘506 and ‘339 Patents were unpatentable, respectively.

Netlist filed Requests for Rehearing of the ‘506 and ‘339 Patent IPRs final written decisions on November 16, 2023 and November 17, 2023, respectively.

On December 20, 2023, the Board denied Netlist’s Request for Rehearing on the ‘506 Patent IPR result.

Netlist filed a Notice of Appeal challenging the Board’s final written decision for the ‘506 Patent, thus instituting an appeal before the Federal Court of Appeals for the Federal Circuit (“CAFC”) of the ‘506 Patent IPR result (CAFC Case No.

24-1521), and as of the reporting date has not filed its Opening Appeal Brief.

On February 9, 2024, the PTAB denied Netlist’s Request for Rehearing on the ‘339 Patent IPR result.

Netlist filed its Notice of Appeal challenging the Board’s final written decision for the ‘339 Patent, thus instituting an appeal before the CAFC of the ‘339 Patent IPR result (CAFC Case No.

24-1707, the “‘339 Appeal”), and as of the reporting date has not filed its Opening Appeal Brief.

On January 31, 2024, an oral hearing was conducted for the Samsung ‘912 Patent IPR proceeding joined by Micron.

On April 17, 2024, the PTAB entered its final written decision for the ‘912 Patent IPR, finding the challenged claim 16 unpatentable.

As of the reporting date, Netlist has not filed a notice of appeal challenging the Board’s final written decision for the ‘912 Patent IPR.

On January 6, 2023, Micron filed IPR requests contesting the validity of the ‘918 and ‘054 Patents, along with motions requesting joinder to the pending Samsung IPRs related to the same patents (see below).

1 unchanged sentence

On September 5, 2023, oral hearings for the ‘918 and ‘054 Patent IPRs were held.

The matters are set for final written decisions, which may issue on or before December 7, 2023.

On December 5, 2023 and December 6, 2023, the PTAB entered final written decisions for the ‘918 and ‘054 Patent IPRs, respectively, finding in both instances that all challenged claims were unpatentable.

On January 5, 2024 and January 6, 2024, Netlist filed requests for USPTO Director Review of the ‘918 and ‘054 Patents final written decisions, respectively.

On March 18, 2024, the USPTO denied Netlist’s request for Director Review of the ‘918 and ‘054 Patent IPRs.

As of the reporting date, Netlist has not filed a notice of appeal challenging the Board’s final written decision for the ‘918 or ‘054 Patent IPRs.

On May 8, 2023, Micron filed IPR requests contesting the validity of the ‘060 and ‘160 Patents, along with motions requesting joinder to the pending Samsung IPRs related to the same patents (see below).

On October 26, 2023, the PTAB instituted the Micron ‘060 and ‘160 Patent IPRs and joined them with the earlier-filed ‘060 and ‘160 IPRs.

On October 26, 2023, the PTAB instituted the Micron ‘060 and ‘160 Patent IPRs and joined them with the earlier-filed ‘060 and ‘160 Patent IPRs.

An oral hearing was held on January 11, 2024, and on April 1, 2024, the PTAB issued its final written decisions finding all challenged claims of the ‘060 and ‘160 Patents unpatentable.

On May 1, 2024, Netlist requested a director review of the final written decisions.

On July 28, 2023, Micron filed two IPR petitions contesting the validity of the ‘215 and ‘417 Patents.

On January 3, 2024, the PTAB granted institution and joinder to Samsung’s earlier-filed IPRs for the same two patents.

The parties completed briefing on the Samsung ‘417 and ‘215 Patent IPRs that Micron had joined and held oral arguments on May 3, 2024.

As of the reporting date, the PTAB has not yet issued its final written decision.

On December 11, 2023, Micron filed a complaint in the District Court for the Fourth Judicial District of the State of Idaho alleging Netlist violated Idaho Code § 48-1703 through its assertion of the ‘833 Patent in the WDTX (the “First Idaho Complaint”).

Netlist removed the matter from State Court to the Federal District Court for the District of

Idaho on January 2, 2024.

On January 18, 2024, the matter was assigned to Judge David C.

Nye for all proceedings, and Micron filed a Motion to remand the case back to Idaho state court.

On February 7, 2024, Netlist moved to dismiss Micron’s First Idaho Complaint or alternatively transfer the case, and on February 8, 2024 responded to Micron’s Motion to Remand.

On February 22, 2024, Micron filed its reply in support of its remand motion.

On February 28, 2024 Micron filed its response to Netlist’s Motion to Dismiss or Transfer the case.

On March 13, 2024, Netlist filed its reply in support of its Motion to Dismiss or Transfer the case.

As of the reporting date, the Court has not yet ruled on these motions.

On December 22, 2023, Netlist filed a Declaratory Judgment action in the Federal District Court for the EDTX, Marshall Division, seeking confirmation from the Court that Netlist has not made a bad-faith assertion of patent infringement against Micron.

On January 19, 2024, Micron filed a Motion to Dismiss.

On February 7, 2024, Netlist amended its complaint, and on March 6, 2024, Micron filed its Answer to Netlist’s First Amended Complaint.

On April 23, 2024, the Court held a scheduling conference, and on April 24, 2024 the Court entered its docket control order setting the matter for a jury trial on July 7, 2025.

On January 10, 2024, Micron filed an IPR petition, again contesting the validity of the ‘608 Patent, along with a motion to join Samsung’s instituted parallel IPR proceeding.

As of the reporting date, the PTAB has not yet entered an order instituting a trial under Micron’s petition or joining Micron’s second ‘608 Patent challenge to Samsung’s co-pending challenge.

On January 16, 2024, Micron filed a second complaint in the District Court for the Fourth Judicial District of the State of Idaho alleging Netlist violated Idaho Code § 48-1703, this time for Netlist’s assertion of the ‘918 and ‘054 Patents in the EDTX.

On February 9, 2024, Netlist removed the matter from State Court to the Federal District Court for the District of Idaho.

The removed case has been assigned to Judge David C.

On February 16, 2024, Netlist filed a Motion to Dismiss or in the Alternative Transfer the case.

Micron filed its opposition to Netlist’s Motion to Transfer on March 8, 2024.

On March 11, 2024, Micron filed a Motion to Remand the case.

As of the reporting date, the Court has not yet ruled on these motions.

Samsung Litigations

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District Court for the Central District of California for Samsung’s breach of the parties’ Joint Development and License Agreement (“JDLA”).

On July 22, 2020,

Netlist amended its complaint to seek a declaratory judgment that it properly terminated the JDLA in light of Samsung’s material breaches.

On July 22, 2020, Netlist amended its complaint to seek a declaratory judgment that it properly terminated the JDLA in light of Samsung’s material breaches.

On October 14, 2021, the Court entered summary judgment in Netlist’s favor and confirmed Netlist properly terminated the JDLA as of July 15, 2020.

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On October 17, 2023, the Ninth Circuit panel issued an unpublished memorandum affirming-in-part and reversing-and-remanding-in-part the District Court’s rulings.

On November 8, 2023, the Ninth Circuit issued a mandate to the California Central District Court.

On November 8, 2023, the Ninth Circuit issued a mandate to the California Central District Court, whereupon the Court issued an Order reopening the case as of November 13, 2023.

After collecting a joint statement of the case from the parties, the Court ordered the parties to rebrief the remaining issues in the summary judgment proceedings based only on the existing record.

On February 5, 2024, the Court held a hearing on the remaining summary judgment issues, and on February 6, 2024, the Court issued an Order denying all of the parties’ various pending motions.

In the same Order, the Court set the matter for a jury trial to begin on March 26, 2024, with a final pretrial conference set for March 18, 2024.

The Court used the conference set for March 18, 2024 to discuss the status of the case, and then on March 22, 2024, reset the final pretrial conference to April 15, 2024 and trial start date to May 14, 2024.

On March 28, 2024, the Court reset the final pretrial conference to May 6, 2024 at 2:00 pm, and kept the trial start date as May 14, 2024.

As of the reporting date, the Court has maintained the May 14, 2024 trial start date.

On October 15, 2021, Samsung initiated a declaratory judgement action against Netlist in the DDE ( Samsung Elecs.

1 unchanged sentence

Netlist, Inc.

1:21-cv-01453-RGA), where it requested in relevant part that the DDE declare that Samsung does not infringe Netlist’s U.S.

9,858,218 (the “‘218 Patent”), 10,217,523 (the “‘523 Patent”), 10,474,595 (the “‘595 Patent”), and the ‘506, ‘339, ‘912 and ‘918 Patents, while later seeking leave to add the ‘054 Patent (issued Jan.

25, 2022) to its action.

1:21-cv-01453-RGA), where it requested in relevant part that the DDE declare that Samsung does not infringe the ‘218, ‘523, ‘595, ‘506, ‘339, ‘912 and ‘918 Patents, while later seeking leave to add the ‘054 Patent (issued January 25, 2022) to its action.

On August 1, 2022, Hon.

Judge Andrews dismissed all of Samsung’s counts related to Netlist’s ‘912, ‘506, ‘339, and ‘918 Patents, and denied Samsung’s request to bring its ‘054 claims in Delaware.

Judge Andrews dismissed all of Samsung’s counts related to Netlist’s ‘912, ‘506, ‘339, and ‘918 Patents, and denied Samsung’s request to bring its ‘054 Patent claims in Delaware.

On September 12, 2022, Netlist amended its Counterclaims to include counterclaims tying Google to the action.

2 unchanged sentences

On October 10, 2023, the Court entered an order granting-in-part and denying-in-part Samsung’s prior motion to stay the matter in light of pending IPRs and a Ninth Circuit appeal, staying claims with respect to the ‘218 and ‘595 Patents, while allowing claims under the ‘523 Patent to proceed.

As of the reporting date, the Court has not entered an Order on Google’s motion, but the Claim Construction hearing was held on October 20, 2023, and the Jury Trial is still scheduled to begin on February 3, 2025.

Samsung has since filed another Motion to Stay given the recent Ninth Circuit decision.

As of the reporting date, the parties are briefing the issues for the Court.

On November 19, 2021, Samsung filed IPR requests contesting the validity of the ‘218, the ‘595, and the ‘523 Patents.

On December 1, 2023, the Court entered an Oral Order staying the matter entirely until the development of any action by any other court pertaining to Samsung’s and Netlist’s rights under the JDLA that may merit lifting the stay.

As of the reporting date, the case remains stayed.

On November 19, 2021, Samsung filed IPR requests contesting the validity of the ‘218, ‘595, and ‘523 Patents.

Netlist filed its initial responses to Samsung’s IPR petitions on February 18, 2022, contesting the institution of any IPR on the grounds propounded.

As of the reporting date, the PTAB issued a final written decision finding all of the claims of the ‘523 Patent valid and patentable, while finding all of the claims of the ‘218 and ‘595 Patents unpatentable.

On May 3, 2023, the PTAB issued a final written decision finding all of the claims of the ‘523 Patent valid and patentable, while on May 8, 2023 and May 9, 2023, it found all of the claims of the ‘218 and ‘595 Patents, respectively, unpatentable.

On July 10, 2023, Samsung filed a Notice of Appeal challenging the Board’s decision upholding the patentability of the ‘523 Patent, thus instituting an appeal before the CAFC of the ‘523 Patent IPR result (CAFC Case No.

As of the reporting date, the parties have completed briefing on the appeal, and the Federal Circuit has not yet set a date for oral arguments.

On December 20, 2021, Netlist filed a complaint for patent infringement against Samsung in the EDTX (Case No.

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the ‘060, ‘160, and ‘054 Patents.

Netlist brought claims under the ‘339, ‘918, ‘054, ‘060, and ‘160 Patents in its Jury Trial, which concluded on April 21, 2023, with the entry of the jury’s verdict into the public record.

The ‘506, ‘339, ‘918, ‘060, ‘160, and ‘054 Patents are hereafter collectively referred to as the “EDTX1 Patents.” Netlist brought claims under the ‘339, ‘918, ‘054, ‘060, and ‘160 Patents in its Jury Trial, which concluded on April 21, 2023, with the entry of the jury’s verdict into the public record.

The jury unanimously found that Samsung willfully infringed Netlist’s ‘339, ‘918, ‘054, ‘060, and ‘160 Patents through the sale of their DDR4 LRDIMMs, DDR5 DIMMs, and HBMs, and that none of the patent claims asserted at trial were invalid.

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As of the reporting date, the parties have filed post-judgment motions, including a motion by Samsung to vacate the final judgment in light of the Ninth Circuit’s recent decision.

The parties are briefing all of the post-judgment motions, and as of the reporting date the Court has not yet entered its final order.

The parties have briefed all of the post-judgment motions, and as of the reporting date the Court has not yet entered its final order.

Additionally, as of the reporting date, all of the EDTX1 Patents are subject to IPR final written decisions.

The outcome of each of the IPR proceedings related to each of the EDTX1 Patents may affect the underlying collectability of the jury award in this matter.

On February 17, 2022, Samsung filed an IPR request contesting the validity of only claim 16 within the ‘912 Patent.

Samsung then filed two additional IPR requests contesting the validity of the ‘506 and ‘339 Patents.

Netlist filed

its Patent Owner’s Preliminary Response for the ‘912 and ‘339 Patent IPRs on July 21, 2022, and for the ‘506 Patent IPR on July 28, 2022.

Netlist filed its Patent Owner’s Preliminary Response for the ‘912 and ‘339 Patent IPRs on July 21, 2022, and for the ‘506 Patent IPR on July 28, 2022.

On January 19, 2023, the PTAB instituted IPR trials on both the ‘912 and ‘339 Patents.

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Vidal entered an Order in the ‘912 Patent proceeding mandating a sua sponte Director review of the Board’s decision granting institution of the ‘912 Patent and staying the underlying proceedings in lieu of a supplemental briefing schedule set by the Director herself.

On February 3, 2023, Director Vidal entered a decision requiring the assigned Board to reevaluate Netlist’s request for discovery on the admitted relationship between Samsung and Google and reassess whether Google is a “Real Party in Interest.” On June 30, 2023, the Board resumed the trial on the Samsung ‘912 Patent IPR, which now also includes Micron’s claims via joinder (see above), and scheduled the ‘912 Patent IPR for further substantive briefing and an oral hearing on January 31, 2024.

On October 17, 2023 and October 18, 2023, the PTAB issued final written decisions stating that all challenged claims of the ‘506 and ‘339 Patents were unpatentable, respectively.

On February 3, 2023, Director Vidal entered a decision

requiring the assigned Board to reevaluate Netlist’s request for discovery on the admitted relationship between Samsung and Google and reassess whether Google is a “Real Party in Interest.” On June 30, 2023, the Board resumed the trial on the Samsung ‘912 Patent IPR, which now also includes Micron’s claims via joinder (see above), and scheduled the ‘912 Patent IPR for further substantive briefing and an oral hearing on January 31, 2024.

On October 17, 2023 and October 18, 2023, the PTAB issued final written decisions stating that all challenged claims of the ‘506 and ‘339, respectively, Patents were unpatentable.

Netlist filed Requests for Rehearing of the ‘506 and ‘339 Patent IPR final written decisions on November 16, 2023 and November 17, 2023, respectively.

On December 20, 2023, the Board denied Netlist’s Request for Rehearing on the ‘506 Patent IPR result.

Netlist filed a Notice of Appeal challenging the Board’s final written decision for the ‘506 Patent, thus instituting an appeal before the CAFC of the ‘506 Patent IPR result (CAFC Case No.

24-1521), and as of the reporting date has not filed its Opening Appeal Brief.

On February 9, 2024, the PTAB denied Netlist’s Request for Rehearing on the ‘339 Patent IPR result.

Netlist filed its Notice of Appeal challenging the Board’s final written decision for the ‘339 Patent, thus instituting an appeal before the CAFC of the ‘339 Patent IPR result (CAFC Case No.

24-1707), and as of the reporting date has not filed its Opening Appeal Brief.

On January 31, 2024, an oral hearing was conducted for the Samsung ‘912 Patent IPR proceeding joined by Micron.

On April 17, 2024, the PTAB entered its final written decision for the ‘912 Patent IPR, finding the challenged claim 16 unpatentable.

As of the reporting date, Netlist has not filed a notice of appeal challenging the Board’s final written decision for the ‘912 Patent IPR.

On May 17, 2022, Samsung filed two IPR petitions contesting the validity of Netlist’s ‘918 and ‘054 Patents.

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Micron has joined these Samsung IPRs on the ‘918 and ‘054 Patents, and oral arguments were heard on September 7, 2023.

As of the reporting date, the Board has not issued a final written decision regarding Samsung’s IPR of either the ‘918 Patent or ‘054 Patent, which Micron has joined.

On June 3, 2022, Netlist filed patent infringement lawsuits against Samsung in Dusseldorf, Germany, seeking damages for Samsung’s infringement of Netlist’s Patents EP735 and EP660.

On January 5, 2024 and January 6, 2024, Netlist filed requests for USPTO Director Review of the ‘918 and ‘054 Patents, respectively, final written decisions.

On March 18, 2024, the USPTO denied Netlist’s request for Director Review of the ‘918 and ‘054 Patent IPRs.

As of the reporting date, Netlist has not filed a notice of appeal challenging the Board’s final written decision for the ‘918 or ‘054 Patent IPRs.

On June 3, 2022, Netlist filed patent infringement lawsuits against Samsung in Dusseldorf, Germany, seeking damages for Samsung’s infringement of Netlist’s patents EP735 and EP660 (“Samsung Dusseldorf Action”).

An Oral Hearing was held in the Dusseldorf Court on September 5, 2023 to determine the question of infringement specifically.

The Court confirmed at the hearing that an Order would issue either staying the matter until a decision was reached on validity by the German Federal Patent Court, or a dismissal of the case if there were no infringement.

On September 25, 2023, the Dusseldorf Court entered a stay of the matter until the German Federal Patent Court renders a decision in the nullity actions currently pending for the EP735 Patent and EP660 Patent.

As of the reporting date, the German Federal Patent Court’s oral hearing on the EP735 Patent is set for March 2024, while the hearing on the EP660 Patent is set for July 2024.

On September 25, 2023, the Dusseldorf Court entered a stay of the matter until the German Federal Patent Court renders a decision in the nullity actions currently pending for EP735 and EP660.

The German Federal Patent Court has issued its order finding the EP735 null, and the Samsung Dusseldorf Action has been stayed pending the outcome of the nullity reviews of the asserted EP patents.

On August 1, 2022, Netlist filed a complaint for patent infringement against Samsung in the EDTX (Case No.

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Chief Judge Gilstrap on September 26, 2023.

As of the reporting date, the Court has not yet entered an Order confirming the Claim Construction outcomes, and the consolidated case still has a docket control order listing trial beginning on April 15, 2024.

On November 21, 2023, the Court entered its Claim Construction Order.

The final pretrial conference was held on March 6, 2024, and as of the reporting date, the Court has not set the jury trial start date.

On August 26, 2022, Samsung filed two IPR petitions contesting the validity of Netlist’s ‘060 and ‘160 Patents.

On January 19, 2023, Netlist filed its Patent Owner Preliminary Responses in those proceedings.

As of the reporting date, the Board instituted trials for both IPRs and set substantive briefing deadlines, including the date for oral argument on both IPRs as January 11, 2024.

An oral hearing was held on January 11, 2024, and on April 1, 2024, the PTAB issued its final written decisions finding all challenged claims of the ‘060 and ‘160 Patents unpatentable.

On May 1, 2024, Netlist requested a director review of the final written decisions.

On January 10, 2023, Samsung filed two IPR petitions contesting the validity of the ‘215 and ‘417 Patents.

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The Board simultaneously set a schedule for briefing deadlines, and the date for oral arguments on May 3, 2024.

On January 3, 3024, the PTAB joined the later-filed and substantially-identical Micron IPRs for the ‘215 and ‘417 Patents to Samsung’s IPRs.

The parties completed briefing on the ‘417 and ‘215 Patent IPRs and held oral arguments on May 3, 2024.

As of the reporting date, the PTAB has not yet issued its final written decisions.

On April 27, 2023, Samsung filed an IPR petition contesting the validity of the ‘608 Patent.

The Board accorded Samsung’s IPR petition a filing date on June 14, 2023.

As of the reporting date, Netlist’s has submitted its preliminary response to the petition.

The PTAB will enter its institution decision on or before December 14, 2023.

On October 9, 2023, Samsung initiated a declaratory judgement action against Netlist in the District of Delaware ( Samsung Elecs.

On December 12, 2023, the PTAB instituted an IPR trial for the ‘608 Patent, despite having previously denied institution from Micron’s earlier-filed IPR petition of the same Patent.

On December 26, 2023, Netlist filed a request for review of the institution decision by the Director of the USPTO.

As of the reporting date, the PTAB and USPTO Director have denied Netlist’s requests.

Netlist filed its Patent Owner’s Response on March 29, 2024.

As of the reporting date, Samsung has not yet filed its reply.

On October 9, 2023, Samsung initiated a second declaratory judgement action against Netlist in the DDE ( Samsung Elecs.

Co., Ltd., et.

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1:23-cv-01122-RGA), where it requested in relevant part that the DDE declare that Samsung does not infringe Netlist’s U.S.

11,386,024 (the “‘024 Patent”) and that Netlist allegedly breached its contractual obligations to JEDEC and thus harmed Samsung as a third-party beneficiary.

11,386,024 (the “‘024 Patent”) and that Netlist allegedly breached its contractual obligations to the Joint Electron Device Engineering Council and thus harmed Samsung as a third-party beneficiary.

Netlist filed a motion to dismiss the action on November 6, 2023.

As of the reporting date, the parties have completed briefing on Netlist’s motion and the Court has yet to enter an order.

Other Contingent Obligations

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The Company’s authorized capital stock includes 10,000,000 shares of serial preferred stock, with a par value of $ 0.001 per share.

No shares of preferred stock were outstanding as of September 30, 2023 or December 31, 2022.

No shares of preferred stock were outstanding as of March 30, 2024 or December 30, 2023.

On April 17, 2017, the Company entered into a rights agreement (as amended from time to time, the “Rights Agreement”) with Computershare Trust Company, N.A., as rights agent.

In connection with the adoption of the Rights Agreement and pursuant to its terms, the Company’s board of directors authorized and declared a dividend of one right (each, a “Right”) for each outstanding share of the Company’s common stock to stockholders of record at the close of business on May 18, 2017 (the “Record Date”), and authorized the issuance of one Right for each share of the Company’s common stock issued by the Company (except as otherwise provided in the Rights Agreement) between the Record Date and the Distribution Date (as defined below).

On April 17, 2024, the Company appointed Equiniti Trust

Company, LLC (“Equiniti”) as rights agent under the Rights Agreement pursuant to that certain Amendment No.

4 to Rights Agreement, dated as of April 17, 2024, by and between the Company and Equiniti (the “Fourth Amendment”).

Each Right entitles the registered holder, subject to the terms of the Rights Agreement, to purchase from the Company, when exercisable and subject to adjustment, one unit consisting of one one -thousandth of a share (a “Unit”) of Series A Preferred Stock of the Company (the “Preferred Stock”), at a purchase price of $ 6.56 per Unit, subject to adjustment.

Subject to the provisions of the Rights Agreement, including certain exceptions specified therein, a distribution date for the Rights (the “Distribution Date”) will occur upon the earlier of (i) 10 business days following a public announcement that a person or group of affiliated or associated persons (an “Acquiring Person”) has acquired or otherwise obtained beneficial ownership of 15 % or more of the then-outstanding shares of the Company’s common stock, and (ii) 10 business days (or such later date as may be determined by the Company’s board of directors) following the commencement of a tender offer or exchange offer that would result in a person or group becoming an Acquiring Person.

The Rights are not exercisable until the Distribution Date and, unless earlier redeemed or exchanged by the Company pursuant to the terms of the Rights Agreement (as amended on April 16, 2018, April 16, 2019 and August 14, 2020) will expire on the close of business on April 17, 2024.

The Rights are not exercisable until the Distribution Date and, unless earlier redeemed or exchanged by the Company pursuant to the terms of the Rights Agreement (as amended on April 16, 2018, April 16, 2019, August 14, 2020, and April 17, 2024) will expire on the close of business on April 17, 2027.

In connection with the adoption of the Rights Agreement, the Company’s board of directors approved a Certificate of Designation of the Series A Preferred Stock (the “Certificate of Designation”) designating 1,000,000 shares of its serial preferred stock as Series A Preferred Stock and setting forth the rights, preferences and limitations of the Preferred Stock.

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In connection with the purchases, we issued to Lincoln Park an aggregate of 44,939 shares of our common stock as additional commitment shares in noncash transactions.

During the nine months ended September 30, 2023, Lincoln Park purchased an aggregate of 7,865,000 shares of our common stock for a net purchase price of $ 23.4 million under the September 2021 Purchase Agreement.

In connection with the purchases, we issued to Lincoln Park an aggregate of 44,939 shares of our common stock as additional commitment shares in noncash transactions.

2023 Offering

On August 14, 2023, the Company entered into a Securities Purchase Agreement (the “2023 Purchase Agreement”) with certain investors, pursuant to which the Company agreed to issue and sell to the investors in a registered offering (the “2023 Offering”) an aggregate of 11,111,112 shares of our common stock and warrants to purchase up to an aggregate of 11,111,112 shares of our common stock at a per share purchase price of $ 2.70 per share.

The 2023 Offering closed on August 17, 2023.

The net proceeds to the Company from the 2023 Offering were approximately $ 28.6 million, after deducting placement agent fees and offering costs paid by the Company.

The warrants are exercisable at any time on or after the issuance date, have a term of five years from the issuance date, and have an exercise price of $ 3.20 per share and contain customary 4.99 %/ 9.99 % blocker provisions.

In addition, pursuant to the 2023 Purchase Agreement, the Company and our director and executive officers entered into lock-up agreements (the “Lock-Up Agreements”), pursuant to which they agreed not to offer for sale,

contract to sell, or sell any shares of the Company’s common stock or any securities convertible into, or exercisable or exchangeable for, shares of the Company’s common stock, for a period of 90 days from the closing of the 2023 Offering, subject to certain customary exceptions.

The 2023 Purchase Agreement also provides that the Company may not effect or enter into any Variable Rate Transactions (as defined in the 2023 Purchase Agreement) until the six month anniversary of the closing date of the 2023 Offering.

Sales of the Company’s common stock pursuant to the September 2021 Purchase Agreement are permitted after 90 days following the closing of the 2023 Offering.

During the three months ended March 30, 2024, Lincoln Park purchased an aggregate of 1,240,000 shares of our common stock for a net purchase price of $ 2.1 million under the September 2021 Purchase Agreement.

connection with the purchases, we issued to Lincoln Park an aggregate of 4,085 shares of our common stock as additional commitment shares in noncash transactions.

Note 9—Stock-Based Awards

As of September 30, 2023, the Company had 131,596 shares of common stock reserved for future issuance under its Amended and Restated 2006 Incentive Plan (“Amended 2006 Plan”).

As of March 30, 2024, the Company had 1,772,423 shares of common stock reserved for future issuance under its Amended and Restated 2006 Incentive Plan (“Amended 2006 Plan”).

Stock options granted under the Amended 2006 Plan generally vest at a rate of at least 25 % per year over four years and expire 10 years from the grant date.

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Stock Options

The following table summarizes the activity related to stock options during the nine months ended September 30, 2023:

The following table summarizes the activity related to stock options during the three months ended March 30, 2024:

(in thousands)

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Expired or forfeited

Outstanding as of September 30, 2023

Outstanding as of March 30, 2024

Restricted Stock Units

The following table summarizes the activity related to RSUs during the nine months ended September 30, 2023:

The following table summarizes the activity related to RSUs during the three months ended March 30, 2024:

(in thousands)

Balance nonvested as of December 30, 2023

Balance nonvested as of September 30, 2023

Balance nonvested as of March 30, 2024

Stock-Based Compensation

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Three Months Ended

Nine Months Ended

September 30,

Cost of sales

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Selling, general and administrative

As of September 30, 2023, the Company had approximately $ 10.5 million, net of estimated forfeitures, of unearned stock-based compensation, which it expects to recognize over a weighted-average period of approximately 2.7 years.

As of March 30, 2024, the Company had approximately $ 8.3 million, net of estimated forfeitures, of unearned stock-based compensation, which it expects to recognize over a weighted-average period of approximately 2.3 years.

Note 10—Warrants

Warrant activity for the nine months ended September 30, 2023 is as follows:

Warrant activity for the three months ended March 30, 2024 is as follows:

(in thousands)

Outstanding as of December 30, 2023

Outstanding as of September 30, 2023

Outstanding as of March 30, 2024

Note 11—Subsequent Events

2023 SVB Credit Agreement

On November 7, 2023, we entered into a loan and security agreement (the “2023 SVB Credit Agreement”) with Silicon Valley Bank, a division of First-Citizen Bank & Trust Company, which provides for a revolving line of credit up to $ 10.0 million.

The borrowing base is limited to 85 % of eligible accounts receivable, subject to certain adjustments.

Borrowings accrue interest on advance at a per annum rate equal to the greater of 8.50 % and the Wall Street Journal prime rate (“Prime Rate”).

The maturity date is November 7, 2025.

The 2023 SVB Credit Agreement requires letters of credit to be secured by cash, which is classified as restricted cash in the accompanying condensed consolidated balance sheets.

As of November 9, 2023, outstanding borrowings were $ 0 , and availability under the revolving line of credit was $ 10.0 million.

The 2023 SVB Credit Agreement subjects the Company to certain affirmative and negative covenants, including financial covenants with respect to the Company’s liquidity and restrictions on the payment of dividends.

As of November 9, 2023, the Company was in compliance with its covenants under the 2023 SVB Credit Agreement.

On April 17, 2024, the Company entered into the Fourth Amendment.

The Fourth Amendment appointed Equiniti as rights agent and amended the definition of “Expiration Date” in the Rights Agreement to extend the term for an additional three year period which extended the final expiration of the Rights issued pursuant to the Rights Agreement from April 17, 2024 to April 17, 2027.

As a result and pursuant to the Fourth Amendment, the Rights will expire and become unexercisable on or before the close of business on April 17, 2027, in accordance with the terms of the Rights Agreement.

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