Subsequent Events

12 Months Ended

Mar. 31, 2023

Subsequent Events [Abstract]

Subsequent Events

Subsequent Events

Warrant Repricing and Issuance

On April 3, 2023, the Company entered into warrant exercise inducement offer letters (“Inducement Letters”) with certain holders of outstanding warrants to purchase shares of the Company’s common stock (such holders, the “Exercising Holders,” and such warrants, the “Existing Warrants”), pursuant to which the Exercising Holders agreed to exercise, for cash, Existing Warrants to purchase, in the aggregate, 1,815,848 shares of the Company’s common stock (the “Existing Warrant Shares”), in exchange for the Company’s agreement to (i) lower the exercise price of the Existing Warrants to $4.00 per share and (ii) issue new warrants (the “Inducement Warrants”) to the Exercising Holders to purchase, in the aggregate, up to 2,269,810 shares of the Company’s common stock.

The Inducement Warrants have an exercise price of $5.00 per share, provide for a cashless exercise feature, and are exercisable until April 3, 2026. Certain Exercising Holders have contractually agreed to restrict their ability to exercise the Inducement Warrants issued to them if the holder (together with such holder’s affiliates, and any persons acting as a group together with such holder or any of such holder’s affiliates) would beneficially own a number of shares in excess of 9.99% of the shares of the Company’s common stock then outstanding. At the holder’s option, upon notice to the Company, the holder may increase or decrease this beneficial ownership limitation not to exceed 19.99% of the shares of common stock then outstanding, with any such increase becoming effective upon 61 days’ prior notice to the Company.

Private Placement of Common Stock and Warrants

On April 3, 2023, the Company entered into securities purchase agreements (each, a “Purchase Agreement”) with two accredited investors that are affiliated with each other (the “Purchasers”) pursuant to which the Company agreed to sell to the Purchasers in a private placement (the “Private Placement”) for an aggregate purchase price of $2.0 million (i) an aggregate of 500,000 shares (the “Shares”) of the Company’s common stock at a purchase price of $4.00 per share and (ii) warrants to purchase an aggregate of 250,001 shares of the Company’s common stock (the “Warrants”). The Warrants have an exercise price of $5.00 per share, provide for a cashless exercise feature, and are exercisable until April 3, 2026.

On April 3, 2023, the Company entered into a registration rights agreement (the “Registration Rights Agreement”) with the Purchasers, pursuant to which the Company agreed to register the Shares and the shares of Common Stock issuable upon exercise of the Warrants (collectively, the “Registrable Securities”) for resale. Under the terms of the Registration Rights Agreement, the Company is obligated, subject to certain exceptions, to (i) no later than 30 days after the closing of the Private Placement, file a registration statement with the Securities and Exchange Commission (the “SEC”) covering the resale or other disposition of the Registrable Securities, (ii) use its commercially reasonable efforts to cause such registration statement to become effective no later than 60 days after such registration statement is first filed with the SEC, and (iii) use its commercially reasonable efforts to keep such

registration statement effective for up to three years after the date on which such registration statement is declared effective by the SEC. The registration statement was filed and declared effective within the time period required by the Registration Rights Agreement.

The Company received total aggregate gross proceeds of approximately $9.3 million (before deducting legal costs of $0.4 million) from the exercise of the Existing Warrants by the Exercising Holders and from the Purchasers in the private placement.

Revolving Loan Repayment

On April 4, 2023, the Company paid to Nexperia the revolving loan of $12.2 million, consisting of an outstanding principal amount of $12.0 million plus accrued but unpaid interest of $0.2 million. See Note 11 - Debt.

Performer Agreement

On May 17, 2023, the Company entered into a Performer Agreement (the “Agreement”) with the National Security Technology Accelerator (“NSTXL”), pursuant to which the Company has agreed to develop and manufacture advanced GaN epiwafer materials in accordance with statements of work, and in support of an agreement between NSTXL and the U.S. Government. Under the Agreement, the Company may receive up to $15.2 million in funding from NSTXL, payable in installments based on achievement of project milestones. The Agreement is incrementally funded with $7.5 million in funding committed as of the execution date of the Agreement, subject to the completion of project milestones. The Agreement has an initial expiration date of December 9, 2024, which may be extended in the event the U.S. Government exercises its option to provide future funding commitments to the Company that may total up to $7.7 million.

Rights Offering

On June 16, 2023, the Company issued a press release announcing that the independent Financing Committee of the Company’s board of directors has approved a subscription rights offering intended to raise up to $15 million (the “Rights Offering”) and has fixed the close of business (5:00 p.m. Eastern Daylight Time) on June 26, 2023 as the record date for the Rights Offering. The Rights Offering will be made through the distribution to all holders of record of the Company’s common stock as of the record date of non-transferable subscription rights to purchase a fraction of a share of the Company’s common stock, at a ratio to be determined, for every one right held at a subscription price to be determined prior to the commencement of the rights offering.