Vislink Technologies, Inc 10-K for FY2023

Vislink Technologies, Inc. (VISL)

10-K 2024-04-03 For: 2023-12-31

Added on April 06, 2026

About this 10-K

Vislink Technologies, Inc filed this 10-K on April 3, 2024, covering the fiscal year ended December 31, 2023 (FY2023).

Headline figures

Fiscal year ended December 31, 2023, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $27.48M; down 2.3% from $28.13M a year earlier
Net loss: $9.13M; compared with a net loss of $13.54M a year earlier
Diluted EPS: -$3.83; compared with -$5.81 a year earlier

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Delaware		20-5856795
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

Title of each class:		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, par value $0.00001		VISL		The Nasdaq Capital Market

Large accelerated filer ☐	Accelerated filer ☐
Non-accelerated filer ☒	Smaller reporting company ☒
	Emerging growth company ☐

			Page
PART I
	Item 1.	Business	4
	Item 1A.	Risk Factors	12
	Item 1B.	Unresolved Staff Comments	29
	Item 1C.	Cybersecurity	29
	Item 2.	Properties	31
	Item 3.	Legal Proceedings	31
	Item 4.	Mine Safety Disclosures	31
PART II
	Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities	32
	Item 6.	Reserved	32
	Item 7.	Management’s Discussion and Analysis of Financial Conditions and Results of Operations	33
	Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	46
	Item 8.	Financial Statements and Supplementary Data	46
	Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	46
	Item 9A.	Controls and Procedures	47
	Item 9B.	Other Information	47
	Item 9C.	Disclosure Regarding Foreign Jurisdictions that Prevent Inspections	47
PART III
	Item 10.	Directors, Executive Officers, and Corporate Governance	48
	Item 11.	Executive Compensation	48
	Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	48
	Item 13.	Certain Relationships and Related Transactions, and Director Independence	48
	Item 14.	Principal Accountant Fees and Services	48
PART IV
	Item 15.	Exhibits, Financial Statement Schedules	49
SIGNATURES			52
FINANCIAL STATEMENTS			F-1

	●	We have incurred losses in the past and may be unable to achieve or sustain profitability in the future.
	●	We may require additional capital to fund our existing commercial operations, develop, market, and commercialize new products, and expand our operations. If we do not obtain additional financing, our business prospects, financial condition, and results of operations will be adversely affected if required.
	●	Our industry is highly competitive, and we may need to compete more effectively.
	●	Defects or errors in our products and services or products made by our suppliers could harm our brand and relations with our customers and expose us to liability. If we experience product recalls, we may incur significant expenses and experience decreased demand for our products.
	●	We acknowledge material weaknesses in our internal controls and procedures over financial reporting. In the future, we may identify additional material weaknesses that may cause us to fail to meet our reporting obligations, including timeliness, or result in material misstatements of our financial statements.
	●	We rely extensively on information technology systems and could face cybersecurity risks.
	●	We rely on key executive officers, and their knowledge of our business and technical expertise would be difficult to replace.
	●	We purchase some components, subassemblies, and products from a limited number of suppliers. The loss of these suppliers may substantially disrupt our ability to obtain orders and fulfill sales as we design and qualify new components.
	●	Our intellectual property protections may be insufficient to safeguard our technology adequately.
	●	We may be subject to claims of intellectual property infringement or invalidity. Expenses incurred for monitoring, protecting, and defending our intellectual property rights could adversely affect our business.
	●	Enforcement of our intellectual property rights abroad, particularly in China, is limited, and it is often difficult to protect and enforce such rights.
	●	The intellectual property rights of others may prevent us from developing new products or entering new markets.
	●	We may be subject to infringement claims in the future.
	●	If our technology did not work as planned or if we were unsuccessful in developing and selling new products or penetrating new markets, our business and operating results would suffer.
	●	Demand for our defense-related products and products for emergency response services depends on government spending.
	●	Regulation of the telecommunications industry could harm our operating results and prospects.
	●	New regulations or standards or changes in existing laws or standards in the United States or internationally related to our products may result in unanticipated costs or liabilities, which could have a material adverse effect on our business, results of operations, and future sales and could place additional burdens on our business operations.
	●	Our industry is subject to rapid technological change, and to compete successfully, we must make substantial investments in new products, services, and technologies.
	●	At several of our annual stockholder meetings, including our 2019 Annual Meeting of Stockholders, we failed to obtain ratification by our stockholders of specific proposals submitted for approval of our stockholders at prior annual meetings, which could be deemed defective corporate acts.
	●	Our failure to meet Nasdaq’s continued listing requirements could result in our common stock’s delisting, which could negatively impact its market price and liquidity and our ability to access the capital markets.

	●	integrated suites of airborne downlink transmitters, receivers, and antenna systems
	●	data and video connectivity for airborne, marine, and ground assets
	●	UAV video distribution
	●	flexible support for COFDM and bonded cellular/5G Networks
	●	terrestrial point-to-point
	●	tactical mobile command
	●	IP-based, high-end encryption, full-duplex, real-time connectivity at extended operating ranges
	●	high-throughput air/marine/ground-to-anywhere uplink and downlink systems
	●	secure live streaming platforms for use in mobile and fixed assets, and
	●	personal portable products

	●	live video encoding, stream adaptation, decoding, and production solutions,
	●	remote production workflows,
	●	wireless cameras,
	●	AI-driven automated production, and
	●	the ability to contribute video over
		○ bonded cellular (3G and 4G)
		○ satellite,
		○ fiber, and
		○ emerging networks, including 5G and Starlink

	●	live internet video traffic is growing fast: from 2016 to 2021, there was a 15-fold increase in live video internet traffic (71.9% CAGR);
	●	the acceleration towards cloud-based remote production;
	●	the increasing demand for enhanced video content formats such as 4K, 8K, and 360-degree video, and
	●	the proliferation of new video transport capable networks such as 5G and Starlink.

	●	it provides us with a long-standing customer base in U.S federal sectors, global OEMs, and EMEA markets,

	●	combinations to make Vislink the de facto leader in the COFDM/Mesh/5G-Based AVDS,

	●	access to advanced, reliable, and robust video downlink solutions to drive additional software and services recurring revenue via the air to anywhere platform,

	●	the positioning of the Company in the growing drone command and control market,

	●	one-stop solutions for live video communications needs, using proprietary COFDM bonded cellular, 5G, and AI-driven technologies for public safety, air-to-ground video distribution, streamlining operational processes and enhancing efficiency,

	●	a more responsive and globally accessible support network ensuring that customers remain connected with their audiences, teams, and operations, and

	●	new opportunities for our customers to access a more comprehensive array of cutting-edge solutions.

	●	Self-Organizing Networks;
	●	R.F. Modulation;
	●	Compression (protocols, payload, signaling, etc.);
	●	Modulators/Demodulators;
	●	Antennas/Shielding;
	●	Wired and Wireless Networks;
	●	Media Access Control Protocols; and
	●	Interference Mitigation.

	●	the cost of expanding our operations and offerings, including our sales and marketing efforts;
	●	our rate of progress in, and cost of the sales and marketing activities associated with, establishing adoption of our products and maintaining or improving our sales to our current customers;
	●	the cost of research and development activities, including research and development relating to new products and technologies or features for existing products;
	●	the effect of competing technological and market developments;
	●	costs related to international expansion, and
	●	the potential cost and delays resulting from regulatory oversight of our business and products.

	●	expanding our sales and marketing efforts to increase market adoption of our products and address competitive developments;
	●	funding development and marketing efforts of any future products or additional features to then-current products;
	●	acquiring, licensing, or investing in new technologies;
	●	providing for supply and inventory costs associated with plans to accommodate potential increases in demand for our products;
	●	acquiring or investing in complementary businesses or assets, and
	●	financing capital expenditures and general and administrative expenses.

	●	authorizing the Board to issue, without stockholder approval, preferred stock with rights senior to those of our common stock; and
	●	they require advance notification of stockholder nominations and proposals.

	●	pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets;

	●	provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements following generally accepted accounting principles and that our receipts and expenditures are being made only by authorizations of its management and board; and

	●	provide reasonable assurance regarding the prevention or timely detection of unauthorized acquisition, use, or disposition of our assets that could have a material effect on its financial statements.

	●	additional review procedures within our accounting and finance department,
	●	implementation of application controls in our accounting system, and
	●	implementation of suitable accounting controls and processes.

	●	a limited availability of market quotations for our securities;
	●	reduced liquidity for our securities;
	●	a determination that our common stock is a “penny stock,” which will require brokers trading in our common stock to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for our securities;
	●	a limited amount of news and analyst coverage, and
	●	a decreased ability to issue additional securities or obtain additional financing.

	●	failure of the acquired business to achieve expected results, as well as the potential impairment of the acquired assets if operating results decline after acquisition;
	●	diversion of management’s attention;
	●	additional financing, if necessary and available, which could increase leverage and costs, dilute equity, or both;
	●	the potential adverse effect on our financial statements from the increase in goodwill and other intangibles;
	●	difficulties in integrating the operations, systems, technologies, products, and personnel of acquired companies;
	●	initial dependence on unfamiliar supply chains or relatively small supply partners;
	●	the potential loss of key employees, customers, distributors, vendors, and other business partners of the companies we acquire after the acquisition;
	●	the high cost and expenses of identifying, negotiating, and completing acquisitions;
	●	the integration of acquisitions requires significant time and resources, and
	●	risks associated with unanticipated events or liabilities.

	●	evaluation of existing cybersecurity risks;
	●	status of ongoing cybersecurity initiatives and strategies, and
	●	incident reports and learnings from cybersecurity events.

	For the Years Ended
	December 31,
	2023			2022

Revenue, net	$	27,482		$	28,131

Cost of revenue and operating expenses

Cost of components and personnel		13,380			15,204
Inventory valuation adjustments		487			2,930
General and administrative expenses		19,376			18,195
Research and development		3,493			4,058
Impairment of right-of-use assets		83			88
Amortization and depreciation		1,261			1,722
Total cost of revenue and operating expenses		38,080			42,197

Loss from operations		(10,598	)		(14,066	)

Other income (expenses)
Unrealized gains on investments held to maturity		68			—
Realized loss on redemption of investments		(82	)		—
Gain on settlement of debt		—			46
Other income		332			303
Dividend income		375			—
Interest income (expense), net		560			(38	)
Total other income		1,253			311

Net loss before income taxes	$	(9,345	)	$	(13,755	)

	●	Classification: The Company classifies its investments in government bonds as “Held-to-Maturity” (HTM) securities based on management’s intent and ability to hold the securities to maturity. These HTM securities are recognized in the Company’s financial statements at their amortized cost, adjusted for the amortization of premiums and accretion of discounts to maturity.
	●	Measurement: HTM securities are initially recognized at their acquisition cost, including transaction costs. Subsequently, they are measured at amortized cost using the effective interest method. This method considers the amortization of any discount or premium on the acquisition cost until maturity.
	●	Interest Income: Interest income is accrued using the security’s effective yield, reflecting the time value of money.
	●	Amortization of Discount and Premium: The amortization of the discount (or accretion of the premium) is included as part of the interest income recognized in the income statement, reflecting the adjustment to the investment’s yield.
	●	Impairment: The Company periodically assesses HTM investments for impairment if objective evidence indicates an impairment has been incurred. It recognizes any loss when the present value of estimated future cash flows, discounted at the original effective interest rate, is less than the carrying amount.
	●	Derecognition: A Held-to-Maturity investment is removed from the balance sheet when the right to receive cash flows has expired, or the Company has substantially transferred all ownership risks and rewards.

	●	A maximum payout of 20% per quarter of the annual standard targeted bonus opportunity for Q1 and Q2 2024, respectively;
	●	A maximum payout of 30% per quarter of the annual standard targeted bonus opportunity for Q3 and Q4 2024 respectively; and
	●	The potential maximum performance bonus opportunities will be considered in connection with the review of our audited financial results for 2024 by our Board of Directors and our Audit Committee.

	●	may have been qualified by disclosures that were made to the other parties in connection with the negotiation of the agreements, which disclosures are not necessarily reflected in the contracts;
	●	may apply standards of materiality that differ from those of a reasonable investor; and
	●	were made only as specified dates in the agreements and subject to subsequent developments and changed circumstances.

Exhibit Number		Description of Exhibit
3.1(i)		Amended & Restated Certificate of Incorporation, incorporated by reference to the Company’s Registration Statement on Form S-1 No. 333-191867, as filed with the Commission on October 23, 2013.
3.1(i)(a)		Amendment to Certificate of Incorporation, incorporated by reference to the Company’s Current Report on Form 8-K, as filed with Commission on June 13, 2014.
3.1 (i)(b)		Amendment to Certificate of Incorporation, incorporated by reference to the Company’s Current Report on Form 8-K, as filed with Commission on July 20, 2015.
3.1(i)(c)		Amended and Restated Certificate of Designation of Series B Convertible Preferred Stock, incorporated by reference to the Company’s Current Report on Form 8-K, as filed with Commission on February 10, 2016.
3.1(i)(d)		Certificate of Designation of Series C Convertible Preferred Stock, incorporated by reference to the Company’s Current Report on Form 8-K, as filed with Commission on February 26, 2015.
3.1(i)(e)		Certificate of Designation of Series D Convertible Preferred Stock, incorporated by reference to the Company’s Current Report on Form 8-K, as filed with Commission on April 27, 2016.
3.1(i)(f)		Certificate of Designation of Series E Convertible Preferred Stock, incorporated by reference to the Company’s Current Report on Form 8-K, as filed with Commission on December 27, 2016.
3.1(i)(g)		Certificate of Designation of the Series A Preferred Stock of the Company, incorporated by reference to the Company’s Current Report on Form 8-K, as filed with Commission on November 9, 2022.
3.1(i)(h)		Certificate of Elimination for Series C Convertible Preferred Stock, incorporated by reference to the Company’s Current Report on Form 8-K, as filed with Commission on February 10, 2016.
3.1(i)(i)		Certificate of Elimination for Series B Convertible Preferred Stock, incorporated by reference to the Company’s Current Report on Form 8-K, as filed with Commission on December 7, 2016.
3.1(i)(j)		Certificate of Elimination for Series D Preferred Stock of the Company, incorporated by reference to the Company’s Current Report on Form 8-K, as filed with Commission on November 9, 2022.
3.1(i)(k)		Certificate of Elimination for Series E Preferred Stock of the Company, incorporated by reference to the Company’s Current Report on Form 8-K, as filed with Commission on November 9, 2022.
3.1(i)(l)		Certificate of Elimination for Series A Preferred Stock of the Company, incorporated by reference to the Company’s Current Report on Form 8-K, as filed with Commission on March 27, 2023.
3.1(i)(m)		Amendment to Certificate of Incorporation, incorporated by reference to the Company’s Current Report on Form 8-K, as filed with Commission on June 20, 2016.
3.1(i)(n)		Certificate of Amendment to Certificate of Incorporation of the Company, incorporated by reference to the Company’s Current Report on Form 8-K, as filed with Commission on February 26, 2019.
3.1(i)(o)		Certificate of Amendment to the Certificate of Incorporation of the Company, incorporated by reference to the Company’s Current Report on Form 8-K, as filed with Commission on August 5, 2020.
3.1(i)(p)		Certificate of Amendment to the Certificate of Incorporation, incorporated by reference to the Company’s Current Report on Form 8-K, as filed with Commission on April 28, 2023.
3.1(ii)		Third Amended & Restated Bylaws, incorporated by reference to the Company’s Current Report on Form 8-K, as filed with Commission on August 20, 2021.
4.1		Form of Common Stock Certificate of the Registrant, incorporated by reference to the Company’s Amendment to the Registration Statement on Form S-1 No. 333-187094, as filed with the Commission on May 21, 2013.
4.2		Warrant Agreement, including Form of Common Warrant and Form of Pre-Funded Warrant from July 2019 Offering, incorporated by reference to the Company’s Current Report on Form 8-K, as filed with Commission on July 16, 2019.
4.3*		Description of Registrant’s Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934.

Exhibit Number		Description of Exhibit
10.1		2023 Omnibus Equity Incentive Plan, incorporated by reference to the Company’s Registration Statement on Form S-8 No. 333-274366, as filed with Commission on September 6, 2023.
10.2		Employment Agreement by and between the Company and Carleton M. Miller, incorporated by reference to the Company’s Amendment to the Current Report on Form 8-K, as filed with the Commission on January 25, 2020
10.3		Notice of Grant of Stock Option for Time-Vested Options and Stock Option Agreement by and between the Company and Carleton M. Miller, incorporated by reference to the Company’s Amendment to the Current Report on Form 8-K, as filed with Commission on January 25, 2020
10.4		Notice of Grant of Stock Option for Performance-Vested Options and Stock Option Agreement by and between the Company and Carleton M. Miller, incorporated by reference to the Company’s Amendment to the Current Report on Form 8-K, as filed with Commission on January 25, 2020
10.5		Offer Letter by and between the Company and Michael Bond, incorporated by reference to the Company’s Current Report on Form 8-K, as filed with Commission on January 17, 2024.
10.6		Inducement RSU Award Agreement between the Company and Michael Bond, incorporated by reference to the Company’s Current Report on Form 8-K, as filed with Commission on January 17, 2024.
10.7		Form of Indemnification Agreement by and between the Company and its officers and directors, incorporated by reference to the Company’s Annual Report on Form 10-K for the period ended December 31, 2019, as filed with the Commission on April 1, 2020-.
10.8		Non-Employee Director Compensation Policy, incorporated by reference to the Company’s Quarterly Report on Form 10-Q for the period ended September 30, 2020 as filed with the Commission on November 12, 2020.
10.9		Form of Non-Employee Director Restricted Shares Agreement, incorporated by reference to the Company’s Quarterly Report on Form 10-Q for the period ended September 30, 2020 as filed with the Commission on November 12, 2020.
14.1		Code of Ethics, incorporated by reference to the Company’s Annual Report on Form 10-K for the period ended December 31, 2013, as filed with the Commission on March 6, 2014.
21.1*		List of Subsidiaries
23.1*		Consent of Marcum LLP
31.1*		Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2*		Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1*		Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2*		Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
97.1*		Clawback Policy
101.INS		Inline XBRL Instance Document
101.SCH		Inline XBRL Taxonomy Schema
101.CAL		Inline XBRL Taxonomy Calculation Linkbase
101.DEF		Inline XBRL Taxonomy Definition Linkbase
101.LAB		Inline XBRL Taxonomy Label Linkbase
101.PRE		Inline XBRL Taxonomy Presentation Linkbase
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

	VISLINK TECHNOLOGIES, INC.

Date: April 3, 2024	By:	/s/ Carleton M. Miller
		Carleton M. Miller
		Chief Executive Officer (Duly Authorized Officer and Principal Executive Officer)

Date: April 3, 2024	By:	/s/ Michael C. Bond
		Michael C. Bond
		Chief Financial Officer (Duly Authorized Officer and Principal Financial Officer)

Signature	Title	Date

/s/ Carleton M. Miller	Chief Executive Officer	April 3, 2024
Carleton M. Miller	(Principal Executive Officer)

/s/ Michael C. Bond	Chief Financial Officer	April 3, 2024
Michael C. Bond	(Principal Financial and Accounting Officer)

/s/ Susan G. Swenson	Chairman of the Board of Directors	April 3, 2024
Susan G. Swenson

/s/ Jude T. Panetta	Director	April 3, 2024
Jude T. Panetta

/s/ Ralph E. Faison	Director	April 3, 2024
Ralph E. Faison

/s/ Brian K. Krolicki	Director	April 3, 2024
Brian K. Krolicki

		Page
Consolidated Financial Statements
Report of Independent Registered Public Accounting Firm (PCAOB ID Number 688)		F-2
Consolidated Balance Sheets		F-3
Consolidated Statements of Operations and Comprehensive Loss		F-4
Consolidated Statements of Changes in Stockholders’ Equity		F-5
Consolidated Statements of Cash Flows		F-6
Notes to Consolidated Financial Statements		F-8

/s/ Marcum LLP

Marcum LLP

We have served as the Company’s auditor since 2015

New York, NY
April 3, 2024

												Accumulated
	Series A									Additional		Other
	Preferred Stock					Common Stock				Paid In		Comprehensive			Treasury			Accumulated
	Shares			Amount		Shares		Amount		Capital		Income (Loss)			Stock			Deficit			Total

Balance, January 1, 2022,*		—		$	—		2,287,651	$	—	$	343,746	$	(297	)	$	(277	)	$	(286,539	)	$	56,633
Net loss		—			—		—		—		—		—			—			(13,540	)		(13,540	)
Unrealized loss on currency translation adjustment		—			—		—		—		—		(1,040	)		—			—			(1,040	)
Issuance of shares of Series A Preferred Stock as dividends for common stock shareholders		47,419																	(20	)		(20	)
Issuance of common stock in connection with:
Satisfaction of accounts payable vendor balance		—			—		3,870		—		54		—			—			—			54
Satisfaction of withholding tax upon conversion of restricted stock units		—			—		17,889		—		—		—			—			—			—
Satisfaction with the conversion of restricted stock units		—			—		57,952		—		—		—			—			—			—
Stock-based compensation		—			—		—		—		1,565		—			—			—			1,565
Balance, December 31, 2022		47,419		$	—		2,367,362	$	—	$	345,365	$	(1,337	)	$	(277	)	$	(300,099	)	$	43,652
Balance		47,419		$	—		2,367,362	$	—	$	345,365	$	(1,337	)	$	(277	)	$	(300,099	)	$	43,652

Net loss		—			—		—		—		—		—			—			(9,127	)		(9,127	)
Unrealized gain on currency translation adjustment		—			—		—		—		—		310			—			—			310
Elimination of Series A Preferred Stock		(47,419	)		—		—		—		—		—			—			—			—
Issuance of common stock in connection with:
Compensation awards for services previously accrued		—			—		10,000		—		200		—			—			—			200
Satisfaction of withholding tax upon conversion of restricted stock units		—			—		14,193		—		—		—			—			—			—
Satisfaction with the conversion of restricted stock unit awards		—			—		48,368		—		—		—			—			—			—
Stock-based compensation		—			—		—		—		1,942		—			—			—			1,942
Balance, December 31, 2023		—		$	—		2,439,923	$	—	$	347,507	$	(1,027	)	$	(277	)	$	(309,226	)	$	36,977
Balance		—		$	—		2,439,923	$	—	$	347,507	$	(1,027	)	$	(277	)	$	(309,226	)	$	36,977

	2023			2022
	Years Ended December 31,
	2023			2022
Cash flows used in operating activities
Net loss	$	(9,127	)	$	(13,540	)
Adjustments to reconcile net loss to net cash used in operating activities
Gain on settlement of debt		—			(46	)
Unrealized gain on investments in debt securities		68			—
Realized loss on investments in debt securities		(82	)		—
Accretion of bond discount		16			—
Stock-based compensation		1,942			1,565
Stock issuance commitments		—			200
Provision for bad debt		25			21
Recovery of bad debt		(10	)		(517	)
Inventory valuation adjustments		487			2,930
Amortization of right-of-use assets, operating assets		375			201
Impairment of right-of-use assets		83			88
Depreciation and amortization		1,261			1,722
Deferred tax benefits		(218	)		(215	)
Changes in assets and liabilities
Accounts receivable		(2,666	)		3,197
Inventory		(2,185	)		(3,731	)
Prepaid expenses and other current assets		200			1,897
Accounts payable		559			(347	)
Accrued expenses and interest expense		218			(1,780	)
Accrued directors’ compensation		(8	)		—
Operating lease liabilities		(344	)		(506	)
Deferred revenue and customer deposits		(342	)		(558	)
Net cash used in operating activities		(9,748	)		(9,419	)
Cash flows used in investing activities
Cash used for investment in securities held to maturity		(15,473	)		—
Cash used in asset acquisition		(269	)		—
Proceeds for bond redemption		9,740			—
Cash used for property and equipment		(698	)		(466	)
Net cash used in investing activities		(6,700	)		(466	)
Cash flows used in financing activities
Principal payments made on D & O notes payable		(607	)		(765	)
Net cash used in financing activities		(607	)		(765	)
Effect of exchange rate changes on cash		(90	)		46
Net decrease in cash		(17,145	)		(10,604	)
Cash and cash equivalents, beginning of the period		25,627			36,231
Cash and cash equivalents, end of the period	$	8,482		$	25,627

	Years Ended December 31
	2023			2022
Supplemental disclosure of cash payments:
Cash paid during the period for interest	$	12		$	41

Supplemental disclosure of non-cash information:
Notes payable recognized on D & O Insurance policy (Note 15)	$	523		$	750

Issuance of shares of Series A Preferred Stock as dividends for common stock shareholders	$	—		$	20

Common stock issued in connection with:
Board compensation awards previously accrued	$	200		$	200

Settlement of amounts due accounts payable	$	—		$	54

ROU assets and operating lease obligations recognized (Note 16):
Operating lease assets recognized	$	125		$	—
Less: non-cash changes to operating lease assets amortization
amortization		(375	)		(201	)
impairments		(83	)		(43	)
loss on lease impairments		83			(88	)
ROU assets and operating lease obligations recognized	$	(375	)	$	(332	)

Operating lease liabilities recognized	$	125		$	—
Less: non-cash changes to operating lease liabilities accretion		(469	)		(506	)
Operating lease liabilities recognized	$	(344	)	$	(506	)

	Warranty Reserve
December 31, 2021	$	131,000
Warranty reserve expense		98,000
Warranty claims settled and true-up of accrual.		(117,000	)
December 31, 2022	$	112,000
Warranty reserve expense		432,000
Warranty claims settled, and true-up of accrual		(411,000	)
December 31, 2023	$	133,000

	●	Level 1 is observable inputs such as quoted prices in active markets,
	●	Level 2 is defined as inputs other than quoted prices in active markets that are either directly or indirectly observable, and
	●	Level 3 is defined as unobservable inputs in which little or no market data exists, requiring an entity to develop its assumptions.

	●	As of December 31, 2023 – £1.273840 to $1.00; €1.105890 to $1.00
	●	The average exchange rate for the year ended December 31, 2023 – £1.243463 to $1.00; €1.081317 to $1.00
	●	As of December 31, 2022 – £ 1.208970 to $1.00; € 1.069850 to $1.00
	●	The average exchange rate for the year ended December 31, 2022 – £ 1.236579 to $1.00; € 1.052082 to $1.00

	●	On January 23, 2023, the Company purchased a bond for $4,812,500, “HSBC USA INC CP,” with a face value of $5,065,789, a par value of $5,000,000, maturing October 24, 2023, a 5.1948% interest rate, at a discount of $253,289. The bond was redeemed on maturity at a loss of approximately $82,000.

	●	On February 1, 2023, the Company purchased a bond for $5,025,479, “Federal Home Loan Banks,” with a face value of $4,999,750 and accrued interest of $25,729, a par value of $5,000,000, maturing December 22, 2023, at an interest rate of 4.750%. The bond was redeemed at face value on the date of maturity.

	●	On February 28, 2023, the Company purchased a bond for $950,000, “Federal National Mortgage Association,” with a face and par value of $950,000, maturing February 28, 2024, at an interest rate of 5.07%. The value on December 31, 2023, was $949,000.

	●	On October 11, 2023, the Company purchased a bond for $4,711,000, “HSBC USA INC CP,” with a face value of $5,000,000, maturing October 11, 2024, at a 6.262291% interest rate. The value on December 31, 2023, was $4,714,000.