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WiSA Technologies, Inc. (NASDAQ:WISA), a semiconductor and related devices manufacturer, has announced an extension to the warrant exercise period and the appointment of a new Vice President of Finance and future Chief Accounting Officer, according to a recent 8-K filing with the U.S. Securities and Exchange Commission.
On Monday, the company disclosed an amendment to its previous inducement agreement with certain warrant holders, extending the deadline for exercising common stock purchase warrants from September 30, 2024, to October 31, 2024. These warrants were part of an exchange agreement dated September 10, 2024. The extension is designed to induce warrant holders to exercise their options, with the incentive of receiving additional warrants exercisable for up to 65% of the shares issued upon the initial warrant exercise.
In the same filing, WiSA Technologies also announced the appointment of Mr. Stanley Mbugua as Vice President of Finance, effective immediately. Mr. Mbugua is set to succeed Mr. Gary Williams as the Chief Accounting Officer on November 30, 2024, following Mr. Williams' resignation. Mr. Mbugua's previous experience includes roles as Chief Accounting Officer at Presto Automation, Inc., Skillz, Inc., and Rimini Street (NASDAQ:RMNI) Inc.
As part of his employment agreement, Mr. Mbugua will receive an annual base salary of $320,000, eligibility for bonus programs, and a potential one-time bonus related to the company's 2025 annual filing. Additionally, he has been granted 70,000 restricted shares of WiSA's common stock, which will vest over three years, with accelerated vesting in the event of a change of control at the company.
In other recent news, WiSA Technologies announced significant changes in its executive team and board, along with key developments in its financial and product strategies. The company reported that Gary Williams, the Vice President of Finance and Chief Accounting Officer, will leave the company later this year. His departure is not due to any disagreements, and a smooth transition plan is in place. Concurrently, Kimberly Briskey has been appointed to the Board of Directors, following the resignation of Lisa Cummins (NYSE:CMI).
In financial developments, WiSA Technologies has entered into agreements resulting in the issuance of new common stock purchase warrants and the amendment of existing warrants. The company also issued new shares of common stock and additional warrants, exercisable for shares of common stock. WiSA Technologies has committed to filing a registration statement for the resale of these new shares and plans to hold a stockholder meeting to seek approval for the issuance of shares related to these warrants.
On the product front, WiSA Technologies announced the launch of WiSA E, a new technology for wireless immersive audio transmission. The company has already secured five licenses for WiSA E, with revenue from these licenses expected later this year. WiSA Technologies has also regained compliance with Nasdaq's equity listing rule, following a decision by the Nasdaq Hearing Panel.
InvestingPro Insights
WiSA Technologies' recent corporate actions, including the warrant exercise extension and new executive appointment, come at a critical time for the company. According to InvestingPro data, WiSA's market capitalization stands at a modest $9.5 million, reflecting its current challenges. The company's revenue for the last twelve months as of Q2 2024 was $1.79 million, with a concerning revenue growth decline of -34.87% over the same period.
InvestingPro Tips highlight that WiSA is "quickly burning through cash" and "suffers from weak gross profit margins." These insights align with the company's efforts to incentivize warrant exercises, potentially to improve its cash position. The appointment of a new Vice President of Finance and future Chief Accounting Officer may be seen as a strategic move to address these financial challenges.
Despite these concerns, it's worth noting that WiSA "holds more cash than debt on its balance sheet" and "liquid assets exceed short term obligations," which could provide some financial flexibility as the company navigates its current situation.
For investors seeking a more comprehensive analysis, InvestingPro offers 15 additional tips for WiSA Technologies, providing a deeper understanding of the company's financial health and market position.
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