FORM 10-K
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Delaware
(State or Other Jurisdiction of
Incorporation or Organization)
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45-4320930
(I.R.S. Employer
Identification No.)
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Title of each class
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Name of each exchange on which registered
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Common Stock, $0.001 par value
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The NASDAQ Stock Market LLC
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Large accelerated filer
o
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Accelerated filer
o
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Non-accelerated filer
o
(Do not check if smaller reporting company)
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Smaller reporting company
x
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Page
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Item 1B
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•
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the status of filter designs under development;
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the prospects for licensing filter designs upon completion of development;
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plans for other filter designs not currently in development;
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potential customers for our designs;
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the timing and amount of future royalty streams;
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our plans regarding the use of proceeds from our IPO and the expected duration of our capital resources;
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our plans regarding future financings;
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our hiring plans;
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the impact of our designs on the mobile device market;
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our business strategy;
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our intentions, expectations and beliefs regarding anticipated growth, market penetration and trends in our business;
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the timing and success of our plan of commercialization;
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our dependence on growth in our customers’ businesses;
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the effects of market conditions on our stock price and operating results;
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our ability to maintain our competitive technological advantages against competitors in our industry and the related costs associated with defending intellectual property infringement and other claims;
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our ability to timely and effectively adapt our existing technology and have our technology solutions gain market acceptance;
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our ability to introduce new offerings and bring them to market in a timely manner;
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our ability to maintain, protect and enhance our intellectual property;
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our expectations concerning our relationships with our customers and other third parties and our customers’ relationships with their manufacturers;
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the attraction and retention of qualified employees and key personnel;
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future acquisitions of or investments in complementary companies or technologies; and
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our ability to comply with evolving legal standards and regulations, particularly concerning requirements for being a public company and United States export regulations.
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Band, channel or frequency band
—a designated range of radio wave frequencies used to communicate with a mobile device.
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Bulk acoustic wave (BAW)
—an acoustic wave traveling through a material exhibiting elasticity.
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Duplexer
—a bi-directional device that connects the antenna to the transmitter and receiver of a wireless device and simultaneously filters both the transmit signal and receive signal.
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Carrier Aggregation (CA)
—the aggregation, or adding together, of multiple 20MHz carriers to meet the LTE-Advanced specification requirements, allowing for increased transmission bandwidth delivery of higher data rates, improved capacity and more efficient use of a carriers fragmented spectrum.
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Filter
—a series of interconnected resonators designed to pass (or select) a desired radio frequency signal and block unwanted signals.
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Reconfigurable filter (previously referred to as Tunable)
—a single filter that is capable of being tuned or reconfigured between two or more predetermined bands.
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Resonator
—a device that naturally oscillates (or resonates) at specific frequencies. The oscillations in a resonator can be either electromagnetic or mechanical (including acoustic). Resonators are the building blocks for filters.
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RF front-end
—the circuitry in a mobile device responsible for the analog signal processing which is located between the antenna and the digital baseband.
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Surface acoustic wave (SAW)
—an acoustic wave traveling along the surface of a material exhibiting elasticity, with an amplitude that typically decays exponentially with depth into the substrate.
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Temperature-Compensated SAW (TC-SAW)
—a SAW device which has additional material changes to reduce its variation with changes in temperature.
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our royalty fees and the cost of our designed filters relative to other competing designs and technologies;
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perception by RF front-end manufacturers and mobile device manufacturers;
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press and blog coverage, social media coverage, and other publicity and public relations factors which are not within our control; and
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regulatory developments related to manufacturing, marketing and selling our designs.
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market acceptance of their mobile wireless devices that contain our designs;
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the impact of slowdowns or declines in sales of mobile wireless devices in general;
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their ability to design products with features that meet the evolving tastes and preferences of consumers;
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fluctuations in foreign currency;
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relationships with wireless carriers in particular markets;
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the implementation of, or changes to, mobile wireless device certification standards and programs;
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technological advancements in the functionality and capabilities of mobile wireless devices;
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the imposition of restrictions, tariffs, duties, or regulations by foreign governments on mobile wireless device manufacturers;
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failure to comply with governmental restrictions or regulations;
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cost and availability of components for their products; and
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inventory levels in the sales channels into which mobile wireless device manufacturers sell their products.
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build a reputation for a superior solution and create trust and long-term relationships with our potential customers;
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distinguish ourselves from competitors in our industry;
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develop and offer a competitive technology that meet our potential customers’ needs as they change;
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respond to evolving industry standards and government regulations that impact our business;
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expand our business internationally; and
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attract, hire, integrate and retain qualified and motivated employees.
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expropriation;
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changes in a specific country
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s or region
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s political or economic conditions;
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changes in tax laws, trade protection measures and import or export licensing requirements;
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difficulties in protecting our intellectual property;
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difficulties in managing staffing and exposure to different employment practices and labor laws;
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changes in foreign currency exchange rates;
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restrictions on transfers of funds and other assets of our subsidiaries between jurisdictions;
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changes in freight and interest rates;
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disruption in air transportation between the United States and overseas facilities;
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loss or modification of exemptions for taxes and tariffs; and
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compliance with U.S. laws and regulations related to international operations, including export control and economic sanctions laws and regulations and the Foreign Corrupt Practices Act.
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the progress, completion or failure of efforts to design our first commercial duplexer;
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a customer decision regarding incorporation of our first duplexer design into a commercial product;
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the loss of any customer relationship;
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the addition of a new customer relationship;
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mergers and acquisitions involving us, our customers or our competitors;
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price and volume fluctuations in the overall stock market from time to time;
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significant volatility in the market price and trading volume of technology companies in general;
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fluctuations in the trading volume of our shares or the size of our public float;
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actual or anticipated changes or fluctuations in our results of operations;
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whether our results of operations meet the expectations of securities analysts or investors;
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actual or anticipated changes in the expectations of investors or securities analysts;
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litigation involving us, our industry, or both;
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regulatory developments in the United States, foreign countries, or both;
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general economic conditions and trends;
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major catastrophic events;
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lockup releases, sales of large blocks of our common stock;
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departures of key employees; or
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an adverse impact on the company from any of the other risks cited herein.
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the ability of our board of directors to issue shares of preferred stock and to determine the price and other terms of those shares, including preferences and voting rights, without stockholder approval, which could be used to significantly dilute the ownership of a hostile acquirer;
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the exclusive right of our board of directors to elect a director to fill a vacancy created by the expansion of our board of directors or the resignation, death or removal of a director, which prevents stockholders from being able to fill vacancies on our board of directors;
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a prohibition on stockholder action by written consent, which forces stockholder action to be taken at an annual or special meeting of our stockholders;
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the requirement that a special meeting of stockholders may be called only by the chairman of our board of directors, the chief executive officer, the president (in the absence of a chief executive officer) or a majority vote of our board of directors, which could delay the ability of our stockholders to force consideration of a proposal or to take action, including the removal of directors;
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the requirement for the affirmative vote of holders of at least 66-2/3% of the voting power of all of the then-outstanding shares of the voting stock, voting together as a single class, to amend the provisions of our amended and restated certificate of incorporation relating to the management of our business or our amended and restated bylaws, which may inhibit the ability of an acquirer to effect such amendments to facilitate an unsolicited takeover attempt;
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the ability of our board of directors, by majority vote, to amend our amended and restated bylaws, which may allow our board of directors to take additional actions to prevent an unsolicited takeover and inhibit the ability of an acquirer to amend our amended and restated bylaws to facilitate an unsolicited takeover attempt; and
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advance notice procedures with which stockholders must comply to nominate candidates to our board of directors or to propose matters to be acted upon at a stockholders’ meeting, which may discourage or deter a potential acquirer from conducting a solicitation of proxies to elect the acquirer’s own slate of directors or otherwise attempting to obtain control of us.
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High
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Low
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Fiscal 2014
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Second Quarter (from May 29, 2014)
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$
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11.54
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$
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7.25
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Third Quarter
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$
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8.24
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$
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6.02
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Fourth Quarter
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$
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12.00
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$
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4.93
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Fiscal 2015
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First Quarter
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$
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19.86
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$
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7.05
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Second Quarter
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$
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7.52
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$
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2.84
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Third Quarter
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$
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5.75
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$
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1.93
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Fourth Quarter
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$
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4.84
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$
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2.51
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Payments Due by Period
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Contractual Obligations
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Total
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Less Than
1 Year
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1-3 Years
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3-5 Years
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More Than
5 Years
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Operating lease commitments
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$
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295,000
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$
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205,000
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$
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90,000
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None
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None
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Page
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December 31, 2014
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December 31, 2015
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ASSETS
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CURRENT ASSETS
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Cash and cash equivalents
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$
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5,803,000
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$
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2,501,000
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Prepaid expenses and other current assets
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105,000
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138,000
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Investment held-to-maturity
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8,000,000
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3,006,000
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TOTAL CURRENT ASSETS
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13,908,000
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5,645,000
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PROPERTY AND EQUIPMENT
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Fixed assets
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1,249,000
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1,664,000
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Less: Accumulated depreciation and amortization
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(208,000
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)
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(672,000
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)
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PROPERTY AND EQUIPMENT, NET
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1,041,000
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992,000
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NONCURRENT ASSETS
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Patents and domain names, net
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500,000
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815,000
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Restricted Cash
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—
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100,000
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Other assets
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15,000
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15,000
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TOTAL NONCURRENT ASSETS
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515,000
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930,000
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TOTAL ASSETS
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$
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15,464,000
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$
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7,567,000
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LIABILITIES AND STOCKHOLDERS’ EQUITY
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CURRENT LIABILITIES
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Accounts payable
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$
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223,000
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$
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518,000
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Accrued expenses
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146,000
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60,000
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Accrued salaries and payroll related expenses
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315,000
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467,000
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Deferred rent, current portion
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36,000
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34,000
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TOTAL CURRENT LIABILITIES
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720,000
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1,079,000
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LONG-TERM LIABILITIES
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Deferred rent
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54,000
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20,000
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TOTAL LIABILITIES
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774,000
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1,099,000
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Commitments and contingencies (Note 9)
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STOCKHOLDERS’ EQUITY
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Common stock, $0.001 par value, 47,000,000 authorized and 6,931,984 outstanding as of December 31, 2014, and 7,241,949 outstanding as of December 31, 2015
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7,000
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7,000
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Preferred stock, $0.001 par value, 3,000,000 authorized and none outstanding as of December 31, 2014 and 2015
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—
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—
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Additional paid-in capital
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35,880,000
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37,373,000
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Accumulated deficit
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(21,197,000
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)
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(30,912,000
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)
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TOTAL STOCKHOLDERS’ EQUITY
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14,690,000
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6,468,000
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TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
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$
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15,464,000
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$
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7,567,000
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Year Ended December 31, 2014
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Year Ended December 31, 2015
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REVENUES
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$
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—
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$
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—
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OPERATING EXPENSES
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Research and development expenses
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2,534,000
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3,554,000
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General and administrative expenses
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2,258,000
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4,085,000
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Stock compensation expense
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1,087,000
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1,611,000
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Depreciation and amortization
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220,000
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491,000
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TOTAL OPERATING EXPENSES
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6,099,000
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9,741,000
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OPERATING LOSS
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(6,099,000
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)
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(9,741,000
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)
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OTHER INCOME (EXPENSE)
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Interest and investment income
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29,000
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27,000
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Interest expense
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(2,808,000
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)
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—
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Fair value adjustments to warrant and derivative liabilities
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(2,016,000
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)
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—
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Other income
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1,164,000
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—
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TOTAL OTHER INCOME (EXPENSE)
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(3,631,000
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)
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27,000
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LOSS BEFORE INCOME TAXES
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(9,730,000
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)
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(9,714,000
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)
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Provision for income taxes
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(1,000
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)
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(1,000
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)
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NET LOSS
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$
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(9,731,000
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)
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$
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(9,715,000
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)
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NET LOSS PER SHARE - BASIC AND DILUTED
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$
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(2.16
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)
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$
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(1.36
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)
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Weighted average shares outstanding — basic and diluted
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4,510,242
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7,160,567
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Common Stock
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Additional
Paid-in
Capital
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Accumulated
Deficit
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Total
Stockholders’
Equity (Deficit)
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Shares
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Amount
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Balance, January 1, 2014
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999,999
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$
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1,000
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$
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1,000
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$
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(11,466,000
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)
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$
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(11,464,000
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)
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Sale of common stock in our initial public offering
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3,105,000
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3,000
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18,627,000
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—
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18,630,000
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Offering costs of our initial public offering
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—
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—
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(2,388,000
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)
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—
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(2,388,000
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)
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Reclassification of warrant liabilities
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—
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—
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3,658,000
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—
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3,658,000
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Conversion of convertible notes
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2,787,667
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3,000
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9,397,000
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—
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9,400,000
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Write-off of derivative liability upon conversion of notes payable
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—
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—
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5,526,000
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—
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5,526,000
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|
||||
Vesting of restricted stock units
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39,318
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—
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—
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|
—
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|
|
—
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Sale of warrants
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—
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—
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1,000
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—
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1,000
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||||
Stock-based compensation
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—
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|
|
—
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|
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1,087,000
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|
|
—
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|
1,087,000
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|
||||
Tax withholding on net exercise of stock-based awards
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|
—
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|
|
—
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|
|
(29,000
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)
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|
—
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|
|
(29,000
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)
|
||||
Net loss
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|
—
|
|
|
—
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|
|
—
|
|
|
(9,731,000
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)
|
|
(9,731,000
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)
|
||||
Balance, December 31, 2014
|
|
6,931,984
|
|
|
7,000
|
|
|
35,880,000
|
|
|
(21,197,000
|
)
|
|
14,690,000
|
|
||||
Issuance of common stock for compensation
|
|
68,781
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|
|
—
|
|
|
—
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|
|
—
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|
|
—
|
|
||||
Stock issued to consultants for services
|
|
33,000
|
|
|
—
|
|
|
156,000
|
|
|
—
|
|
|
156,000
|
|
||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
1,382,000
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|
|
—
|
|
|
1,382,000
|
|
||||
Exercise of warrants, cashless
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208,184
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—
|
|
|
—
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|
|
—
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|
|
—
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|
||||
Tax withholding on net issuance of common stock for compensation
|
|
—
|
|
|
—
|
|
|
(45,000
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)
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|
—
|
|
|
(45,000
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)
|
||||
Net Loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(9,715,000
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)
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|
(9,715,000
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)
|
||||
Balance, December 31, 2015
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|
7,241,949
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|
|
$
|
7,000
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|
|
$
|
37,373,000
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|
|
$
|
(30,912,000
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)
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$
|
6,468,000
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|
|
|
Year Ended December 31, 2014
|
|
Year Ended December 31, 2015
|
||||
CASH FLOWS FROM OPERATING ACTIVITIES
|
|
|
|
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|
|||
Net Loss
|
|
$
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(9,731,000
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)
|
|
$
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(9,715,000
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)
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Adjustments to reconcile net loss to net cash used in operating activities:
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|
|
|
|
|
|||
Depreciation and amortization
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220,000
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|
|
491,000
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|
||
Amortization of deferred finance costs
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2,404,000
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|
|
—
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|
||
Stock-based compensation
|
|
1,087,000
|
|
|
1,611,000
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|
||
Non-cash investment income
|
|
(20,000
|
)
|
|
(18,000
|
)
|
||
Gain on extinguishment of derivative liability
|
|
(1,164,000
|
)
|
|
—
|
|
||
Fair value adjustments to warrant and derivative liabilities
|
|
2,016,000
|
|
|
—
|
|
||
Changes in assets and liabilities:
|
|
|
|
|
||||
Prepaids and other current assets
|
|
78,000
|
|
|
(32,000
|
)
|
||
Other assets
|
|
(3,000
|
)
|
|
—
|
|
||
Accounts payable
|
|
131,000
|
|
|
295,000
|
|
||
Accrued expenses
|
|
(18,000
|
)
|
|
(86,000
|
)
|
||
Accrued compensation
|
|
301,000
|
|
|
79,000
|
|
||
Deferred rent
|
|
86,000
|
|
|
(36,000
|
)
|
||
Net cash used in operating activities
|
|
(4,613,000
|
)
|
|
(7,411,000
|
)
|
||
CASH FLOWS FROM INVESTING ACTIVITIES
|
|
|
|
|
|
|||
Capital expenditures
|
|
(1,017,000
|
)
|
|
(415,000
|
)
|
||
Expenditures for patents and domain names
|
|
(140,000
|
)
|
|
(342,000
|
)
|
||
Purchase of restricted cash investment
|
|
—
|
|
|
(100,000
|
)
|
||
Redemption of investments held-to-maturity
|
|
—
|
|
|
15,000,000
|
|
||
Purchase of investments held-to-maturity
|
|
(7,980,000
|
)
|
|
(9,989,000
|
)
|
||
Net cash provided by (used in) investing activities
|
|
(9,137,000
|
)
|
|
4,154,000
|
|
||
CASH FLOWS FROM FINANCING ACTIVITIES
|
|
|
|
|
|
|||
Proceeds from sale of common stock from the IPO
|
|
18,630,000
|
|
|
—
|
|
||
IPO costs
|
|
(2,388,000
|
)
|
|
—
|
|
||
Proceeds from issuance of warrants
|
|
1,000
|
|
|
—
|
|
||
Payment of withholding tax on net exercise of stock-based awards
|
|
(29,000
|
)
|
|
(45,000
|
)
|
||
Net cash provided by (used in) financing activities
|
|
16,214,000
|
|
|
(45,000
|
)
|
||
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
|
|
2,464,000
|
|
|
(3,302,000
|
)
|
||
CASH AND CASH EQUIVALENTS — Beginning of year
|
|
3,339,000
|
|
|
5,803,000
|
|
||
CASH AND CASH EQUIVALENTS — End of year
|
|
$
|
5,803,000
|
|
|
$
|
2,501,000
|
|
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
|
|
|
|
|
|
|||
Interest
|
|
$
|
414,000
|
|
|
$
|
—
|
|
Taxes
|
|
$
|
1,000
|
|
|
$
|
1,000
|
|
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES
|
|
|
|
|
|
|||
Conversion of senior note
|
|
$
|
7,000,000
|
|
|
$
|
—
|
|
Conversion of subordinated note
|
|
$
|
2,400,000
|
|
|
$
|
—
|
|
Extinguishment of derivative liability
|
|
$
|
5,526,000
|
|
|
$
|
—
|
|
Reclassification of warrant liabilities to additional paid-in capital
|
|
$
|
3,658,000
|
|
|
$
|
—
|
|
|
Year Ended December 31, 2014
|
|
Year Ended December 31, 2015
|
||
Common stock warrants
|
1,039,484
|
|
|
804,463
|
|
Common stock options
|
491,200
|
|
|
565,050
|
|
Total shares excluded from net loss per share attributable to common stockholders
|
1,530,684
|
|
|
1,369,513
|
|
|
Total
|
||
Balance at December 31, 2013
|
$
|
380,000
|
|
Amortization
|
(20,000
|
)
|
|
Legal fees for pending patents
|
140,000
|
|
|
Balance at December 31, 2014
|
500,000
|
|
|
Amortization
|
(27,000
|
)
|
|
Legal fees for pending patents
|
342,000
|
|
|
Balance at December 31, 2015
|
$
|
815,000
|
|
Years ending December 31,
|
|
||
2016
|
$
|
29,000
|
|
2017
|
29,000
|
|
|
2018
|
29,000
|
|
|
2019
|
29,000
|
|
|
2020
|
29,000
|
|
|
2021 and thereafter
|
207,000
|
|
|
Total amortization expense
|
$
|
352,000
|
|
|
2014
|
|
2015
|
||||
Cost:
|
|
|
|
|
|||
Computers, peripheral and scientific equipment
|
$
|
145,000
|
|
|
$
|
360,000
|
|
Software
|
464,000
|
|
|
644,000
|
|
||
Leasehold Improvements
|
283,000
|
|
|
476,000
|
|
||
Office furniture and equipment
|
175,000
|
|
|
184,000
|
|
||
Construction-in-process
|
182,000
|
|
|
—
|
|
||
|
1,249,000
|
|
|
1,664,000
|
|
||
Less accumulated depreciation and amortization
|
(208,000
|
)
|
|
(672,000
|
)
|
||
Property and equipment, net
|
$
|
1,041,000
|
|
|
$
|
992,000
|
|
|
Issued and
Outstanding
Warrants as of
January 1, 2014
|
|
Warrants
Issued
|
|
Warrants
Exercised/
Expired
|
|
Issued and
Outstanding
Warrants as of
December 31, 2014
|
||||
Bridge Warrants
|
249,999
|
|
|
—
|
|
|
—
|
|
|
249,999
|
|
Consulting Warrant
|
222,222
|
|
|
—
|
|
|
—
|
|
|
222,222
|
|
Financing Warrant (1)
|
208,763
|
|
|
—
|
|
|
—
|
|
|
208,763
|
|
Underwriting Warrant
|
—
|
|
|
310,500
|
|
|
—
|
|
|
310,500
|
|
IR consulting warrants
|
—
|
|
|
48,000
|
|
|
—
|
|
|
48,000
|
|
|
680,984
|
|
|
358,500
|
|
|
—
|
|
|
1,039,484
|
|
(1)
|
The number of shares of common stock underlying the Financing Warrant was determined using an exercise price of
$3.35
per share, assuming the IPO price of our common stock in a Qualified IPO would be at least
$5.59
per share. Upon completion of the IPO with a price of
$6.00
per share, the number of shares was considered unchanged and final.
|
|
Issued and
Outstanding Warrants as of January 1, 2015 |
|
Warrants
Issued |
|
Warrants
Exercised/ Expired |
|
Issued and
Outstanding Warrants as of December 31, 2015 |
||||
Bridge Warrants
|
249,999
|
|
|
—
|
|
|
—
|
|
|
249,999
|
|
Consulting Warrant
|
222,222
|
|
|
—
|
|
|
(104,444
|
)
|
(2)
|
117,778
|
|
Financing Warrant (1)
|
208,763
|
|
|
—
|
|
|
(130,577
|
)
|
(2)
|
78,186
|
|
Underwriting Warrant
|
310,500
|
|
|
—
|
|
|
—
|
|
|
310,500
|
|
IR consulting warrants
|
48,000
|
|
|
—
|
|
|
—
|
|
|
48,000
|
|
|
1,039,484
|
|
|
—
|
|
|
(235,021
|
)
|
|
804,463
|
|
(2)
|
During the year ended December 31, 2015, there were
235,021
common stock warrants that were exercised through a cashless exercise which netted
208,184
shares being issued.
|
|
Option Grants Awarded During the Year Ended December 31, 2014
|
|
Option Grants Awarded During the Year Ended December 31, 2015
|
Dividend Yield
|
0%
|
|
0%
|
Expected Volatility
|
56.6% - 82.2%
|
|
60.0%
|
Risk-free interest rate
|
1.52% - 2.56%
|
|
1.44% - 1.86%
|
Expected Term
|
4 to 7 years
|
|
7 years
|
|
Number of
Options
|
|
Weighted
Average
Exercise
Price
|
|
Weighted
Average
Grant Date
Fair Value
|
|
Weighted
Average
Remaining
Life In
Years
|
||||||
Outstanding, January 1, 2014
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
—
|
|
Granted
|
491,200
|
|
|
6.29
|
|
|
4.14
|
|
|
9.42
|
|
||
Exercised
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Canceled/Forfeited
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Outstanding, December 31, 2014
|
491,200
|
|
|
$
|
6.29
|
|
|
$
|
4.14
|
|
|
9.42
|
|
Exercisable, January 1, 2014
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
—
|
|
Vested
|
142,895
|
|
|
6.02
|
|
|
4.01
|
|
|
9.41
|
|
||
Exercised
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Canceled/Forfeited
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Exercisable, December 31, 2014
|
142,895
|
|
|
$
|
6.02
|
|
|
$
|
4.01
|
|
|
9.41
|
|
|
Number of
Options
|
|
Weighted
Average
Exercise
Price
|
|
Weighted
Average
Grant Date
Fair Value
|
|
Weighted
Average
Remaining
Life In
Years
|
|||||
Outstanding, January 1, 2015
|
491,200
|
|
|
$
|
6.29
|
|
|
$
|
4.14
|
|
|
9.42
|
Granted
|
77,500
|
|
|
8.36
|
|
|
4.95
|
|
|
9.27
|
||
Exercised
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
||
Canceled/Forfeited
|
(3,650
|
)
|
|
7.28
|
|
|
4.51
|
|
|
—
|
||
Outstanding, December 31, 2015
|
565,050
|
|
|
$
|
6.57
|
|
|
$
|
4.25
|
|
|
7.84
|
Exercisable, January 1, 2015
|
142,895
|
|
|
$
|
6.02
|
|
|
$
|
4.01
|
|
|
9.41
|
Vested
|
160,720
|
|
|
6.47
|
|
|
4.21
|
|
|
6.70
|
||
Exercised
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
||
Canceled/Forfeited
|
(1,200
|
)
|
|
8.06
|
|
|
5.19
|
|
|
—
|
||
Exercisable, December 31, 2015
|
302,415
|
|
|
$
|
6.25
|
|
|
$
|
4.11
|
|
|
7.07
|
Options Outstanding
|
|
Options Exercisable
|
||||||
Exercise
Price
|
|
Outstanding
Number of
Options
|
|
Weighted
Average
Remaining
Life In
Years
|
|
Exercisable
Number
of Options
|
||
$3.83 - $6.00
|
|
390,250
|
|
|
6.77
|
|
257,744
|
|
$6.49 – $6.97
|
|
47,500
|
|
|
8.70
|
|
14,693
|
|
$7.20 – $8.06
|
|
97,300
|
|
|
8.82
|
|
24,350
|
|
$11.44 - $12.98
|
|
30,000
|
|
|
9.15
|
|
5,628
|
|
|
|
565,050
|
|
|
7.07
|
|
302,415
|
|
|
Number of
Restricted Share
Units
|
|
Weighted-Average
Grant-Date Fair
Value
|
|||
Outstanding at January 1, 2014
|
—
|
|
|
$
|
—
|
|
Granted
|
174,500
|
|
|
6.00
|
|
|
Vested
|
(43,233
|
)
|
|
6.00
|
|
|
Canceled
|
—
|
|
|
—
|
|
|
Outstanding at December 31, 2014
|
131,267
|
|
|
$
|
6.00
|
|
|
Number of
Restricted Share
Units
|
|
Weighted-Average
Grant-Date Fair
Value
|
|||
Outstanding at January 1, 2015
|
131,267
|
|
|
$
|
6.00
|
|
Granted
|
343,930
|
|
|
6.35
|
|
|
Vested
|
(73,122
|
)
|
|
6.07
|
|
|
Canceled
|
(26,446
|
)
|
|
(8.06
|
)
|
|
Outstanding at December 31, 2015
|
375,629
|
|
|
$
|
6.16
|
|
|
Year Ended
December 31, 2014 |
Year Ended
December 31, 2015 |
||||
Research and development
|
|
|
|
|
||
Employees
|
$
|
320,000
|
|
$
|
609,000
|
|
Non-employees
|
72,000
|
|
33,000
|
|
||
General and administrative
|
|
|
|
|||
Employees and directors
|
414,000
|
|
664,000
|
|
||
Non-employees
|
224,000
|
|
54,000
|
|
||
|
$
|
1,030,000
|
|
$
|
1,360,000
|
|
Years ending December 31,
|
|
||
2016
|
$
|
205,000
|
|
2017
|
90,000
|
|
|
Total minimum rent payments
|
$
|
295,000
|
|
|
IPO Date
|
Assumptions:
|
|
Risk-free interest rate
|
1.25% - 2.31%
|
Expected dividend yield
|
0%
|
Expected volatility
|
64.0% - 69.6%
|
Expected term (in years)
|
3.58 – 5.95
|
|
Warrant
Liabilities(1)
|
|
Senior
Convertible
Note Derivative
Liability(2)
|
||||
Balance at January 1, 2014
|
$
|
3,276,084
|
|
|
$
|
5,056,502
|
|
Issuance of warrant and derivative liabilities
|
—
|
|
|
—
|
|
||
Change in fair value
|
382,327
|
|
|
1,633,272
|
|
||
Write-off due to conversion and IPO
|
(3,658,411
|
)
|
|
(6,689,774
|
)
|
||
Balance at December 31, 2014
|
$
|
—
|
|
|
$
|
—
|
|
(1)
|
The change in the fair value of the warrants was recorded as a reduction to other income in the consolidated statement of operations of
$382,000
for the year ended
December 31, 2014
. Due to the expiration of the redemption and put option features included in the Bridge Warrants, Consulting Warrant and Financing Warrant as of the IPO Date, these warrant liabilities were recorded as an increase of
$3.7 million
to additional paid-in capital in the consolidated balance sheet as of
December 31, 2014
.
|
(2)
|
The extinguishment of the senior convertible note derivative liability was recorded as an increase of
$5.5 million
to additional paid-in capital and a gain of
$1.6 million
to other income in the consolidated statement of operations for the year ended
December 31, 2014
.
|
|
Year Ended December 31, 2014
|
|
Year Ended December 31, 2015
|
||||
U.S. federal
|
|
|
|
|
|||
Current
|
$
|
—
|
|
|
$
|
—
|
|
Deferred
|
—
|
|
|
—
|
|
||
Total U.S. federal
|
—
|
|
|
—
|
|
||
U.S. state and local
|
|
|
|
|
|||
Current
|
1,000
|
|
|
1,000
|
|
||
Deferred
|
—
|
|
|
—
|
|
||
Total U.S. state and local
|
1,000
|
|
|
1,000
|
|
||
Total income taxes
|
$
|
1,000
|
|
|
$
|
1,000
|
|
|
Year ended December 31, 2014
|
|
Year ended December 31, 2015
|
||||
Expected income tax expense
|
$
|
(3,308,000
|
)
|
|
$
|
(3,291,000
|
)
|
State income tax (benefit), net of federal benefit and federal valuation allowance
|
1,000
|
|
|
1,000
|
|
||
Valuation Allowance (net of state)
|
2,868,000
|
|
|
3,426,000
|
|
||
Permanent Differences:
|
|
|
|
|
|||
Stock Options
|
—
|
|
|
131,000
|
|
||
Change in Fair Market Value — Financing Warrant Expenses
|
130,000
|
|
|
—
|
|
||
Other
|
147,000
|
|
|
10,000
|
|
||
Interest Expenses — Disqualified Debt
|
514,000
|
|
|
—
|
|
||
Research & Development Credit
|
(169,000
|
)
|
|
(174,000
|
)
|
||
Adjustment to Deferred Taxes
|
(182,000
|
)
|
|
(102,000
|
)
|
||
Total provision for income taxes
|
$
|
1,000
|
|
|
$
|
1,000
|
|
|
|
Year ended December 31, 2014
|
|
Year ended December 31, 2015
|
||||
Deferred tax assets—current:
|
|
|
|
|
|
|||
Accrued Expenses
|
|
$
|
3,000
|
|
|
$
|
—
|
|
Accrued Payroll
|
|
6,000
|
|
|
—
|
|
||
Deferred Rent
|
|
36,000
|
|
|
—
|
|
||
Total current assets
|
|
45,000
|
|
|
—
|
|
||
Deferred tax assets—long term:
|
|
|
|
|
|
|||
Accrued Payroll
|
|
—
|
|
|
95,000
|
|
||
Intangibles
|
|
779,000
|
|
|
763,000
|
|
||
Organization Cost
|
|
17,000
|
|
|
—
|
|
||
Start-up Expenditures
|
|
1,691,000
|
|
|
—
|
|
||
Research & Development Credit
|
|
492,000
|
|
|
804,000
|
|
||
Net Operating loss
|
|
1,374,000
|
|
|
6,592,000
|
|
||
Stock Compensation
|
|
140,000
|
|
|
379,000
|
|
||
New Jobs Credit
|
|
7,000
|
|
|
7,000
|
|
||
Total long-term assets
|
|
4,500,000
|
|
|
8,640,000
|
|
||
Total deferred tax assets
|
|
4,545,000
|
|
|
8,640,000
|
|
||
Less: Valuation Allowance
|
|
(4,520,000
|
)
|
|
(8,639,000
|
)
|
||
Deferred tax liabilities—current:
|
|
—
|
|
|
—
|
|
||
Total current liabilities
|
|
—
|
|
|
—
|
|
||
Deferred tax liabilities—long term:
|
|
|
|
|
|
|||
Fixed Assets
|
|
(25,000
|
)
|
|
(1,000
|
)
|
||
Total long-term liabilities
|
|
(25,000
|
)
|
|
(1,000
|
)
|
||
Total deferred tax liabilities
|
|
(25,000
|
)
|
|
(1,000
|
)
|
||
Net deferred tax assets
|
|
$
|
—
|
|
|
$
|
—
|
|
1.
|
Consolidated Financial Statements
|
2.
|
Financial Statement Schedules
|
3.
|
Exhibits
|
Dated:
|
March 24, 2016
|
Resonant Inc.
|
|
|
|
|
|
|
|
By:
|
/s/ JOHN PHILPOTT
|
|
|
|
JOHN PHILPOTT
|
|
|
|
Chief Financial Officer
|
|
|
|
(Principal Financial and Accounting Officer)
|
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
/s/ Terry Lingren
|
|
Chief Executive Officer and Director
|
|
March 24, 2016
|
Terry Lingren
|
|
(Principal Executive Officer)
|
|
|
|
|
|
|
|
/s/ Robert Hammond
|
|
Chief Technology Officer and Director
|
|
March 24, 2016
|
Robert Hammond
|
|
|
|
|
|
|
|
|
|
/s/ George B. Holmes
|
|
President, Chief Commercial Officer and Director
|
|
March 24, 2016
|
George B. Holmes
|
|
|
|
|
|
|
|
|
|
/s/ John E. Major
|
|
Chairman of the Board of Directors
|
|
March 24, 2016
|
John E. Major
|
|
|
|
|
|
|
|
|
|
/s/ Janet K. Cooper
|
|
Director
|
|
March 24, 2016
|
Janet K. Cooper
|
|
|
|
|
|
|
|
|
|
/s/ Michael J. Fox
|
|
Director
|
|
March 24, 2016
|
Michael J. Fox
|
|
|
|
|
|
|
|
|
|
/s/ Thomas Joseph
|
|
Director
|
|
March 24, 2016
|
Thomas Joseph
|
|
|
|
|
|
|
|
|
|
/s/ Richard Kornfeld
|
|
Director
|
|
March 24, 2016
|
Richard Kornfeld
|
|
|
|
|
Exhibit
Number
|
|
|
|
Incorporated by Reference
|
|
Filed
Herewith
|
||||||
|
Exhibit Description
|
|
Form
|
|
File Number
|
|
Exhibit
|
|
Filing Date
|
|
||
3.1
|
|
Amended and Restated Certificate of Incorporation of the Registrant
|
|
8-K
|
|
001-36467
|
|
3.1
|
|
6/5/2014
|
|
|
3.2
|
|
Amended and Restated Bylaws of the Registrant
|
|
8-K
|
|
001-36467
|
|
3.2
|
|
6/5/2014
|
|
|
4.1
|
|
Form of the Registrant’s common stock certificate
|
|
S-1/A
|
|
333-193552
|
|
4.1
|
|
4/11/2014
|
|
|
4.2
|
|
Form of Underwriter’s Warrant
|
|
S-1/A
|
|
333-193552
|
|
4.2
|
|
5/16/2014
|
|
|
10.1*
|
|
Form of Indemnification Agreement between the Registrant and each of its directors and officers
|
|
S-1
|
|
333-193552
|
|
10.1
|
|
1/24/2014
|
|
|
10.2
|
|
Registrant’s amended and restated 2014 Omnibus Incentive Plan, including form agreements
|
|
S-1/A
|
|
333-193552
|
|
10.2
|
|
4/11/2014
|
|
|
10.3*
|
|
Offer Letter between the Registrant and Terry Lingren, dated June 17, 2013
|
|
S-1
|
|
333-193552
|
|
10.3
|
|
1/24/2014
|
|
|
10.4*
|
|
Offer Letter between the Registrant and Robert Hammond, dated June 17, 2013
|
|
S-1
|
|
333-193552
|
|
10.4
|
|
1/24/2014
|
|
|
10.5*
|
|
Offer Letter between the Registrant and Neal Fenzi, dated June 17, 2013
|
|
S-1
|
|
333-193552
|
|
10.5
|
|
1/24/2014
|
|
|
10.6*
|
|
Outside Director Compensation Policy
|
|
|
|
|
|
|
|
|
|
X
|
10.7
|
|
Amendment to Securities Purchase Agreement, dated September 14, 2013, by and among the Registrant and the Required Holders party thereto
|
|
S-1
|
|
333-193552
|
|
10.15
|
|
1/24/2014
|
|
|
10.8
|
|
Registration Rights Agreement for Investors, dated June 17, 2013, by and among the Registrant and the persons listed on Schedule A thereto
|
|
S-1
|
|
333-193552
|
|
10.23
|
|
1/24/2014
|
|
|
10.9
|
|
Registration Rights Agreement for Warrants, dated June 17, 2013, by and among the Registrant and MDB Capital Group LLC
|
|
S-1
|
|
333-193552
|
|
10.24
|
|
1/24/2014
|
|
|
10.10
|
|
Amended and Restated Warrant to Purchase Common Stock, dated November 15, 2013, issued by the Registrant in favor of MDB Capital Group LLC for 222,222 shares of common stock
|
|
S-1
|
|
333-193552
|
|
10.25
|
|
1/24/2014
|
|
|
10.11
|
|
Amended and Restated Warrant to Purchase Common Stock, dated November 15, 2013, issued by the Registrant in favor of MDB Capital Group LLC for a to-be-determined number of shares of common stock
|
|
S-1
|
|
333-193552
|
|
10.26
|
|
1/24/2014
|
|
|
10.12
|
|
Warrant to Purchase Common Stock (No. A-1), dated June 17, 2013, issued by the Registrant in favor of Terry Lingren for 41,666 shares of common stock
|
|
S-1
|
|
333-193552
|
|
10.27
|
|
1/24/2014
|
|
|
10.13
|
|
Warrant to Purchase Common Stock (No. A-2), dated June 17, 2013, issued by the Registrant in favor of Robert Hammond for 41,666 shares of common stock
|
|
S-1
|
|
333-193552
|
|
10.28
|
|
1/24/2014
|
|
|
Exhibit
Number
|
|
|
|
Incorporated by Reference
|
|
Filed
Herewith
|
||||||
|
Exhibit Description
|
|
Form
|
|
File Number
|
|
Exhibit
|
|
Filing Date
|
|
||
10.14
|
|
Warrant to Purchase Common Stock (No. A-3), dated June 17, 2013, issued by the Registrant in favor of Neal Fenzi for 41,666 shares of common stock
|
|
S-1
|
|
333-193552
|
|
10.29
|
|
1/24/2014
|
|
|
10.15
|
|
Warrant to Purchase Common Stock (No. A-4), dated June 17, 2013, issued by the Registrant in favor of Terry Lingren for 41,667 shares of common stock
|
|
S-1
|
|
333-193552
|
|
10.30
|
|
1/24/2014
|
|
|
10.16
|
|
Warrant to Purchase Common Stock (No. A-5), dated June 17, 2013, issued by the Registrant in favor of Robert Hammond for 41,667 shares of common stock
|
|
S-1
|
|
333-193552
|
|
10.31
|
|
1/24/2014
|
|
|
10.17
|
|
Warrant to Purchase Common Stock (No. A-6), dated June 17, 2013, issued by the Registrant in favor of Neal Fenzi for 41,667 shares of common stock
|
|
S-1
|
|
333-193552
|
|
10.32
|
|
1/24/2014
|
|
|
10.18.1
|
|
Multi-Tenant Industrial Lease, dated August 9, 2013, between the Registrant and Nassau Land Company, L.P.
|
|
S-1
|
|
333-193552
|
|
10.33
|
|
1/24/2014
|
|
|
10.18.2
|
|
First Amendment to Lease, dated March 20, 2014, between Registrant and Nassau Land Company, L.P.
|
|
10-K
|
|
001-36467
|
|
10.33.2
|
|
3/27/2015
|
|
|
10.18.3
|
|
Second Amendment to Lease, dated September 15, 2014, between Registrant and Nassau Land Company, L.P.
|
|
10-K
|
|
001-36467
|
|
10.33.3
|
|
3/27/2015
|
|
|
10.19.1
|
|
Standard Multi-Tenant Office Lease—Gross, dated November 14, 2013, between the Registrant and SeaBreeze I Venture—TIC.
|
|
S-1
|
|
333-193552
|
|
10.34
|
|
1/24/2014
|
|
|
10.19.2
|
|
First Amendment to Lease, dated May 5, 2015, between the Registrant and SeaBreeze I Venture—TIC.
|
|
10-Q
|
|
001-36467
|
|
10.10
|
|
8/13/2015
|
|
|
10.20*
|
|
Offer Letter between the Registrant and John Philpott, dated March 10, 2014
|
|
S-1/A
|
|
333-193552
|
|
10.37
|
|
3/24/2014
|
|
|
10.21
|
|
Warrant Agreement issued to MZ Group
|
|
10-Q
|
|
001-36467
|
|
10.30
|
|
8/8/2014
|
|
|
10.22
|
|
Warrant Agreement issued to Investor Relations Consultant
|
|
10-K
|
|
001-36467
|
|
10.40
|
|
3/27/2015
|
|
|
10.23*
|
|
Form of Severance/Change-in-Control Agreement
|
|
10-K
|
|
001-36467
|
|
10.41
|
|
3/27/2015
|
|
|
10.24*
|
|
Offer Letter between the Registrant and Mike Eddy, dated August 16, 2014
|
|
10-K
|
|
001-36467
|
|
10.42
|
|
3/27/2015
|
|
|
10.25*
|
|
Offer letter between the Registrant and George B. Holmes, dated February 9, 2016
|
|
8-K
|
|
001-36467
|
|
10.1
|
|
2/29/2016
|
|
|
10.26*
|
|
Restricted Stock Unit Agreement, with a grant date of February 29,2016 between the Registrant and George B. Holmes
|
|
8-K
|
|
001-36467
|
|
10.2
|
|
2/29/2016
|
|
|
21.1
|
|
List of Subsidiaries
|
|
S-1
|
|
333-193552
|
|
21.1
|
|
1/24/2014
|
|
|
23.1
|
|
Consent of Squar Milner LLP (formerly Squar, Milner, Peterson, Miranda & Williamson, LLP)
|
|
|
|
|
|
|
|
|
|
X
|
23.2
|
|
Consent of Crowe Horwath LLP
|
|
|
|
|
|
|
|
|
|
X
|
24.1
|
|
Power of Attorney (included on signature page)
|
|
|
|
|
|
|
|
|
|
X
|
Exhibit
Number
|
|
|
|
Incorporated by Reference
|
|
Filed
Herewith
|
||||||
|
Exhibit Description
|
|
Form
|
|
File Number
|
|
Exhibit
|
|
Filing Date
|
|
||
31.1
|
|
Certification of Principal Executive Officer Pursuant to Securities Exchange Act Rules 13a-14(a) and 15d-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
|
|
|
|
|
|
|
|
|
X
|
31.2
|
|
Certification of Principal Financial Officer Pursuant to Securities Exchange Act Rules 13a-14(a) and 15d-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
|
|
|
|
|
|
|
|
|
X
|
32.1#
|
|
Certification of Principal Executive Officer and Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
|
|
|
|
|
|
|
|
X
|
101.INS
|
|
XBRL Instance Document
|
|
|
|
|
|
|
|
|
|
X
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
|
|
|
|
|
|
|
|
|
X
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
|
|
|
|
|
|
|
X
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
|
|
|
|
|
|
|
|
X
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
|
|
|
|
|
|
|
|
|
X
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
|
|
|
|
|
|
|
X
|
|
*
|
Each a management contract or compensatory plan or arrangement required to be filed as an exhibit to this annual report on Form 10-K.
|
#
|
The information in this exhibit is furnished and deemed not filed with the Securities and Exchange Commission for purposes of section 18 of the Exchange Act of 1934, as amended, and is not to be incorporated by reference into any filing of Resonant Inc. under the Securities Act of 1933, as amended, or the Exchange Act of 1934, as amended, whether made before or after the date hereof, regardless of any general incorporation language in such filing.
|
I.
|
ANNUAL RETAINERS
|
II.
|
PAYMENT
|
III.
|
REVISIONS
|
IV.
|
EQUITY COMPENSATION
|
(a)
|
Initial Award
. Each person upon first becoming an Outside Director will be granted a Restricted Stock Unit Award of 24,000 Restricted Stock Units (the “
Initial RSU Award
”) on the date of the first Board or Compensation Committee meeting occurring on or after
|
(b)
|
Annual Award
. Each Outside Director will be automatically granted a Restricted Stock Unit Award with a Value of $50,000 (the “
Annual RSU Award
”), provided that the number of Shares covered by the Annual RSU Award shall be rounded down to the nearest whole Share, on the date of each annual meeting of stockholders (each, an “
Annual Meeting
”), if, as of such Annual Meeting date, he or she will have served on the Board as a Director for at least the preceding six (6) months; provided that any Outside Director who is not continuing as a Director following the applicable Annual Meeting will not receive an Annual RSU Award with respect to such Annual Meeting. One-half of the shares underlying the Annual RSU Award will vest on the earlier of (i) the day prior to the first annual meeting of stockholders following the grant or (ii) one year from grant, and one-half of the shares underlying the Annual RSU Award will vest on the earlier of (i) the day prior to the second annual meeting of stockholders following the grant or (ii) two years from grant, subject to continued service as a director through the applicable vesting date.
|
(c)
|
Chairman or Lead Independent Director Awards
. An Outside Director who serves as Chairman of the Board or, if the Chairman of the Board is not an Outside Director, Lead Independent Director, will receive the following additional Awards:
|
(i)
|
Initial Award
. The Outside Director upon first becoming Chairman of the Board or Lead Independent Director will be granted a Restricted Stock Unit Award with a Value equal to $25,000, pro rated based on the number of days remaining from the date on which such Outside Director first becomes Chairman or Lead Independent Director until the first anniversary of the Company’s last Annual Meeting (the “
Initial Chairman Award
”), provided that the number of Shares covered by the Initial Chairman Award shall be rounded down to the nearest whole Share, on the date of the first Board or Compensation Committee meeting occurring on or after the date on which such Outside Director first becomes Chairman or Lead Independent Director; provided, however, that an Outside Director who is Chairman of the Board and becomes Lead Independent Director, or is Lead Independent Director and becomes Chairman of the Board, will not receive an Initial Chairman Award as a result of such change in status. One-half of the shares underlying the Initial Chairman Award will vest on the earlier of (i) the day prior to the first annual meeting of stockholders following the grant or (ii) one year from grant, and one-half of the shares underlying the Initial Chairman Award will vest on the earlier of (i) the day prior to the second annual meeting of stockholders following the grant or (ii) two years from grant, subject to continued service as Chairman of the Board and/or Lead Independent Director through the applicable vesting date.
|
(ii)
|
Annual Award
. The Outside Director who serves as Chairman of the Board or, if the Chairman of the Board is not an Outside Director, Lead Independent Director, will be automatically granted a Restricted Stock Unit Award with a Value of $25,000 (the “
Annual Chairman Award
”), provided that the number of Shares covered by the Annual Chairman Award shall be rounded down to the nearest whole Share, on the date of each Annual Meeting, if, as of such Annual Meeting date, he or she will have served on the Board as a Director for at least the preceding six (6) months; provided that any Outside Director who is not continuing as a Director following the applicable Annual Meeting will not receive an Annual Chairman Award with respect to such Annual Meeting. One-half of the shares underlying the Annual Chairman Award will vest on the earlier of (i) the day prior to the first annual meeting of stockholders following the grant or (ii) one year from grant, and one-half of the shares underlying the Annual Chairman Award will vest on the earlier of (i) the day prior to the second annual meeting of stockholders following the grant or (ii) two years from grant, subject to continued service as Chairman of the Board and/or Lead Independent Director through the applicable vesting date.
|
(d)
|
Value
. For purposes of this Policy, “
Value
” means, with respect to any Annual RSU Award, Initial Chairman Award or Annual Chairman Award, the fair market value of the shares subject to the applicable award on the date of grant, as computed in accordance with our Plan.
|
(e)
|
No Discretion
. No person will have any discretion to select which Outside Directors will be granted an Initial RSU Award, Annual RSU Award, Initial Chairman Award or Annual Chairman Award under this Policy or to determine the number of Shares to be covered by such Initial RSU Award, Annual RSU Award, Initial Chairman Award or Annual Chairman Award, as applicable (except as provided in subsection (f) below and pursuant to the Amendment and Termination provisions of this Policy).
|
(f)
|
Revisions
. The Board in its discretion may change and otherwise revise the terms of Initial RSU Awards, Annual RSU Awards, Initial Chairman Awards and/or Annual Chairman Awards granted under this Policy, including, without limitation, the number of Shares subject thereto, to provide for Initial RSU Awards, Annual RSU Awards, Initial Chairman Awards and/or Annual Chairman Awards of the same or different type (e.g., Options, Restricted Stock Units, or other types of Awards) granted on or after the date the Board determines to make any such change or revision.
|
VI.
|
AMENDMENT AND TERMINATION
|
VII.
|
EFFECTIVE DATE
|
I.
|
ANNUAL RETAINERS
|
II.
|
PAYMENT
|
III.
|
REVISIONS
|
IV.
|
EQUITY COMPENSATION
|
(a)
|
Initial Award
. Each person upon first becoming an Outside Director will be granted a Restricted Stock Unit Award of 24,000 Restricted Stock Units (the “
Initial RSU Award
”) on the date of the first Board or Compensation Committee meeting occurring on or after the date on which such person first becomes an Outside Director, whether through election by the stockholders of the Company or appointment by the Board to fill a vacancy; provided, however, that a Director who is an Employee (an “
Inside Director
”) who ceases to be an Inside Director, but who remains a Director, will not receive an Initial RSU Award. The shares underlying the Initial RSU Award will vest as to one-half of the shares subject to such award on each of the first and second anniversary of the commencement of the individual’s service as an Outside Director, subject to continued service as a director through the applicable vesting date.
|
(b)
|
Annual Award
. Each Outside Director will be automatically granted a Restricted Stock Unit Award with a Value of $50,000 (the “
Annual RSU Award
”), provided that the number of Shares covered by the Annual RSU Award shall be rounded down to the nearest whole Share, on the date of each annual meeting of stockholders (each, an “
Annual Meeting
”), if, as of such Annual Meeting date, he or she will have served on the Board as a Director for at least the preceding six (6) months; provided that any Outside Director who is not continuing as a Director following the applicable Annual Meeting will not receive an Annual RSU Award with respect to such Annual Meeting. One-half of the shares underlying the Annual RSU Award will vest on the earlier of (i) the day prior to the first annual meeting of stockholders following the grant or (ii) one year from grant, and one-half of the shares underlying the Annual RSU Award will vest on the earlier of (i) the day prior to the second annual meeting of stockholders following the grant or (ii) two years from grant, subject to continued service as a director through the applicable vesting date.
|
(c)
|
Chairman or Lead Independent Director Awards
. An Outside Director who serves as Chairman of the Board or, if the Chairman of the Board is not an Outside Director, Lead Independent Director, will receive the following additional Awards:
|
(i)
|
Initial Award
. The Outside Director upon first becoming Chairman of the Board or Lead Independent Director will be granted a Restricted Stock Unit Award with a Value equal to $25,000, pro rated based on the number of days remaining from the date on which such Outside Director first becomes Chairman or Lead Independent Director until the first anniversary of the Company’s last Annual Meeting (the “
Initial Chairman Award
”), provided that the number of Shares covered by the Initial Chairman Award shall be rounded down to the nearest whole Share, on the date of the first Board or Compensation Committee meeting occurring on or after the date on which such Outside Director first becomes Chairman or Lead Independent Director; provided, however, that an Outside Director who is Chairman of the Board and becomes Lead Independent Director, or is Lead Independent Director and becomes Chairman of the Board, will not receive an Initial Chairman Award as a result of such change in status. One-half of the shares underlying the Initial Chairman Award will vest on the earlier of (i) the day prior to the first annual meeting of stockholders following the grant or (ii) one year from grant, and one-half of the shares underlying the Initial Chairman Award will vest on the earlier of (i) the day prior to the second annual meeting of stockholders following the grant or (ii) two years from grant, subject to continued service as
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(ii)
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Annual Award
. The Outside Director who serves as Chairman of the Board or, if the Chairman of the Board is not an Outside Director, Lead Independent Director, will be automatically granted a Restricted Stock Unit Award with a Value of $25,000 (the “
Annual Chairman Award
”), provided that the number of Shares covered by the Annual Chairman Award shall be rounded down to the nearest whole Share, on the date of each Annual Meeting, if, as of such Annual Meeting date, he or she will have served on the Board as a Director for at least the preceding six (6) months; provided that any Outside Director who is not continuing as a Director following the applicable Annual Meeting will not receive an Annual Chairman Award with respect to such Annual Meeting. One-half of the shares underlying the Annual Chairman Award will vest on the earlier of (i) the day prior to the first annual meeting of stockholders following the grant or (ii) one year from grant, and one-half of the shares underlying the Annual Chairman Award will vest on the earlier of (i) the day prior to the second annual meeting of stockholders following the grant or (ii) two years from grant, subject to continued service as Chairman of the Board and/or Lead Independent Director through the applicable vesting date.
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(d)
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Value
. For purposes of this Policy, “
Value
” means, with respect to any Annual RSU Award, Initial Chairman Award or Annual Chairman Award, the fair market value of the shares subject to the applicable award on the date of grant, as computed in accordance with our Plan.
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(e)
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No Discretion
. No person will have any discretion to select which Outside Directors will be granted an Initial RSU Award, Annual RSU Award, Initial Chairman Award or Annual Chairman Award under this Policy or to determine the number of Shares to be covered by such Initial RSU Award, Annual RSU Award, Initial Chairman Award or Annual Chairman Award, as applicable (except as provided in subsection (f) below and pursuant to the Amendment and Termination provisions of this Policy).
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(f)
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Revisions
. The Board in its discretion may change and otherwise revise the terms of Initial RSU Awards, Annual RSU Awards, Initial Chairman Awards and/or Annual Chairman Awards granted under this Policy, including, without limitation, the number of Shares subject thereto, to provide for Initial RSU Awards, Annual RSU Awards, Initial Chairman Awards and/or Annual Chairman Awards of the same or different type (e.g., Options, Restricted Stock Units, or other types of Awards) granted on or after the date the Board determines to make any such change or revision.
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VI.
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AMENDMENT AND TERMINATION
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VII.
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EFFECTIVE DATE
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Date: March 24, 2016
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/s/ Terry Lingren
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Terry Lingren
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Chief Executive Officer
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(Principal Executive Officer)
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Date: March 24, 2016
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/s/ John Philpott
|
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John Philpott
|
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Chief Financial Officer
|
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(Principal Financial and Accounting Officer)
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Date: March 24, 2016
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/s/ Terry Lingren
|
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Terry Lingren
|
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Chief Executive Officer
|
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(Principal Executive Officer)
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|
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/s/ John M. Philpott
|
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John M. Philpott
|
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Chief Financial Officer
|
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(Principal Financial and Accounting Officer)
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