Company: GCTS
Filing Date: 2025-03-25
Form Type: 10-K
Source: 0000950170-25-044438
Chunk: 190

Company: GCT Semiconductor Holding, Inc.
Filing Date: 2025-03-25
Form: 10-K
Item: Item 1B
Chunk 190
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 and variable share forward. These freestanding instruments are precluded from equity classification since the Purchase Agreement requires shareholder approval for the issuance of shares in excess of the applicable ownership limitation caps, which is not an input in a fixed-for-fixed option or forward on equity shares. As of April 2024, the Company determined that the fair value of the put option was nominal due to the short settlement period of one day or less, and the Company recognized a liability of $0.6 million related to the freestanding common stock forward contract. The fair value of the common stock forward liability represents the probability-adjusted present value of the discount to be granted to B. Riley with respect to the sales of its common stock under the Purchase Agreement compared to the VWAP of the company’s common stock for the applicable pricing period. In connection with the Purchase Agreement, the Company issued 56,818 shares of its common stock (“Commitment Shares”), which included a make-whole provision requiring the Company to reimburse B. Riley in cash if the fair value of these shares is less than $0.25 million. The Company recognized this amount as a liability which remained outstanding as of December 31, 2024 since the Commitment Shares remained unsold by B. Riley. During the year ended December 31, 2024, the Company sold an aggregate of 2,364,053 shares of common stock for $9.5 million, of which $1.0 million was withheld by B. Riley against the outstanding amounts payable, and $8.5 million was received by the Company in cash. Issuance of Common Stock to UnderwriterIn April 2024, the Company authorized the issuance of 110,000 shares of its common stock to an underwriter previously involved in activities leading to the Business Combination, contingent on the Registration Statement’s effectiveness. The Company determined that its obligation to issue the underwriter shares met the criteria for equity classifications, and the underlying shares of common stock were issued in June 2024. Based on the timing of approval, the Company recognized $0.7 million in charges to equity and included this amount in general and administrative expenses for the year ended December 31, 2024.Private PlacementIn September 2024, the Company executed a securities purchase agreement with Anapass, Inc, and issued 741,603 shares of common stock (“Anapass Shares”) and 148,320 equity-classified common stock warrants (“Anapass Warrants”) in exchange for $2.2 million