0001641172-25-001416 | 10-K | XBRL Viewer

SHARE-BASED COMPENSATION (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands	1 Months Ended								12 Months Ended
	Dec. 31, 2024	Jan. 31, 2024	Oct. 31, 2023	Apr. 30, 2023	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2020	May 31, 2019	Dec. 31, 2024	Dec. 31, 2023	Mar. 31, 2017
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of stock options	3,944,284,000								3,944,284,000	4,657,635
Share based expense									$ 2,433	$ 1,985
Share-Based Payment Arrangement, Option [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Dividend yield rate									0.00%	0.00%
Expected life of options - years									6 years	6 years
Expected stock price volatility									76.00%	76.00%
Risk--free interest rate									3.82%	4.21%
Share based expense									$ 1,132	$ 967
Unrecognized stock-based compensation	$ 2,304								$ 2,304
Weighted average period									2 years 3 months 7 days
Performance Shares [Member] \| Chief Executive Officer and President [Member] \| Minimum [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Service period			1 year
Performance Shares [Member] \| Chief Executive Officer and President [Member] \| Maximum [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Service period			3 years
Performance Shares [Member] \| Chief Executive Officer and President [Member] \| Share-Based Payment Arrangement, Tranche One [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Market capitalization			$ 100,000
Performance Shares [Member] \| Chief Executive Officer and President [Member] \| Share-Based Payment Arrangement, Tranche Two [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Market capitalization			150,000
Performance Shares [Member] \| Chief Executive Officer and President [Member] \| Share-Based Payment Arrangement, Tranche Three [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Market capitalization			$ 200,000
Restricted Stock Units (RSUs) [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Share based expense									$ 1,301	$ 1,018
Restricted stock units, granted		632,911	482,143						881,004	1,289,784
Unrecognized stock-based compensation	$ 1,630								$ 1,630
Weighted average period									3 years 10 days
2017 Stock Incentive Plan [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Share-Based Compensation Arrangement by Share-Based Payment Award, Number of Shares Authorized	16,500,000								16,500,000		2,000,000
Share-Based Compensation Arrangement by Share-Based Payment Award, Number of Additional Shares Authorized	7,500,000				1,500,000	1,500,000	1,900,000	2,100,000
Share-Based Compensation Arrangement by Share-Based Payment Award, Number of Shares Available for Grant	7,585,545								7,585,545
Acceleration cost				$ 112
2017 Stock Incentive Plan [Member] \| Servicebased Options [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of stock options	2,654,118								2,654,118
2017 Stock Incentive Plan [Member] \| Performance Based Options [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of stock options	1,290,166								1,290,166
2017 Stock Incentive Plan [Member] \| Performance Based Options [Member] \| Chief Executive Officer [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Options granted			1,290,166
2017 Stock Incentive Plan [Member] \| Performance Shares [Member] \| Chief Executive Officer and President [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Options granted			1,290,166
Share price			$ 1.40
Expected life of options - years			10 years
Expected stock price volatility			76.00%
Risk--free interest rate			4.65%

Cover - USD ($)	12 Months Ended
Cover - USD ($)	Dec. 31, 2024	Mar. 25, 2025	Jun. 30, 2024
Cover [Abstract]
Document Type	10-K
Amendment Flag	false
Document Annual Report	true
Document Transition Report	false
Document Period End Date	Dec. 31, 2024
Document Fiscal Period Focus	FY
Document Fiscal Year Focus	2024
Current Fiscal Year End Date	--12-31
Entity File Number	001-38750
Entity Registrant Name	Wrap Technologies, Inc.
Entity Central Index Key	0001702924
Entity Tax Identification Number	98-0551945
Entity Incorporation, State or Country Code	DE
Entity Address, Address Line One	3480 Main Hwy
Entity Address, Address Line Two	Suite 202
Entity Address, City or Town	Miami
Entity Address, State or Province	FL
Entity Address, Postal Zip Code	33133
City Area Code	(800)
Local Phone Number	583-2652
Title of 12(b) Security	Common Stock, par value $0.0001 per share
Trading Symbol	WRAP
Security Exchange Name	NASDAQ
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Public Float			$ 69,444,666
Entity Common Stock, Shares Outstanding		50,494,701
Documents Incorporated by Reference [Text Block]	Portions of the registrant’s Proxy Statement for its 2025 Annual Meeting of Stockholders (the “Proxy Statement”), to be filed with the Securities and Exchange Commission within 120 days after the end of the fiscal year ended December 31, 2024, are incorporated herein by reference in Part III of this Annual Report on Form 10-K.
ICFR Auditor Attestation Flag	false
Document Financial Statement Error Correction [Flag]	false
Entity Listing, Par Value Per Share	$ 0.0001
Auditor Firm ID	7000
Auditor Opinion [Text Block]	We have audited the accompanying consolidated balance sheets of Wrap Technologies Inc. (the “Company”) as of December 31, 2024 and 2023, and the related consolidated statements of operations and comprehensive loss, stockholders’ equity, and cash flows for each of the two years in the period ended December 31, 2024, including the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company as of December 31, 2024 and 2023, and the consolidated results of its operations and its consolidated cash flows for each of the two years in the period ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America.
Auditor Name	HTL International, LLC
Auditor Location	Houston, TX

ASSET ACQUISITIONS

12 Months Ended

Dec. 31, 2024

Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract]

ASSET ACQUISITIONS

3. ASSET ACQUISITIONS

Pursuant to the Professional Services and Technology Acquisition Agreement (the “Services Agreement”), dated as of November 22, 2022, and as amended on April 2, 2023, by and among the Company, Lumeto, Inc. (“Lumeto”) and Spatial Industries Group, Inc. (collectively, the “Service Provider”), the Service Provider provides to the Company certain technology, services, and perpetual licenses for use within the Company’s Wrap Reality virtual simulation training platform (the “Technology, Services, and License”), in consideration for a one-time cash payment upon the execution of the Services Agreement of $700.

The Company determined during 2023 that the intangible related to software developed by Lumeto would not have future economic benefit and the value of the intangible was written off as a loss on impairment of $700 as a result.

On August 9, 2023, the Company entered into a Membership Interest Purchase Agreement (the “Intrensic Purchase Agreement”) by and among the Company, certain members of Intrensic, including Kevin Mullins, the Company’s former Chief Executive Officer (collectively, “Sellers”) and Buford Ortale, as the Sellers’ representative. Under the terms of the Intrensic Purchase Agreement, the Company agreed to purchase, and Sellers agreed to sell, 100% of the membership interests (the “Membership Interests”) of Intrensic for the following consideration upon the consummation of the sale of the Membership Interests (the “Intrensic Closing”): (i) $553,588 in cash, subject to adjustment based upon the outstanding indebtedness of Intrensic and Intrensic’s working capital as of the Intrensic Closing; and (ii) 1,250,000 shares of Common Stock of the Company the “Intrensic Acquisition”). The Intrensic Acquisition closed on August 16, 2023, in accordance with the terms of the Intrensic Purchase Agreement. (See Footnote 19).

STOCKHOLDERS’ EQUITY

12 Months Ended

Dec. 31, 2024

Equity [Abstract]

STOCKHOLDERS’ EQUITY

12. STOCKHOLDERS’ EQUITY

The Company’s authorized capital consists of 150,000,000 shares of Common Stock and 5,000,000 shares of preferred stock, par value $0.0001 per share (“Preferred Stock”), of which 10,000 are designated as Series A Preferred Stock.

On July 3, 2023, the Company filed the Certificate of Designations of the Series a Preferred Stock (the “Certificate of Designations”) with the Secretary of State of the State of Delaware, designating 10,000 shares of its Preferred Stock as Series A Convertible Preferred Stock. The terms of the Series A Preferred Stock are as set forth in the form of Certificate of Designations. of the Series A Preferred Stock (the “Certificate of Designations”). The Series A Preferred Stock is convertible into shares of common stock (the “Conversion Shares”) at the election of the holder at any time at an initial conversion price of $1.45 (the “Conversion Price”). The Conversion Price is subject to customary adjustments for stock dividends, stock splits, reclassifications and the like, and subject to price-based adjustment in the event of any issuances of common stock, or securities convertible, exercisable or exchangeable for common stock, at a price below the then-applicable Conversion Price (subject to certain exceptions).

The holders of the Series A Preferred Stock are entitled to dividends of 8% per annum, compounded monthly, which are payable in cash or shares of Common Stock, or a combination thereof, at the Company’s option in accordance with the terms of the Certificate of Designations. Upon the occurrence and during the continuance of a Triggering Event (as defined in the Certificate of Designations), the Series A Preferred Stock will accrue dividends at the rate of 20% per annum. If the Company elects to pay any dividends in shares of Common Stock, the Conversion Price used to calculate the number of shares issuable will equal to the lower of (i) the then applicable Conversion Price and (ii) 85% of the arithmetic average of the three (3) lowest closing prices of the Company’s Common Stock during the twenty (20) consecutive trading day period ending on the trading day immediately preceding the dividend payment date, provided that such price shall not be lower than the lower of (x) $0.2828 (subject to adjustment for stock splits, stock dividends, stock combinations, recapitalizations or other similar events ) and (y) 20% of the “Minimum Price” (as defined in Nasdaq Stock Market Rule 5635) on the date of the Stockholder Approval (subject to adjustment for stock splits, stock dividends, stock combinations, recapitalizations or other similar events) or, in any case, such lower amount as permitted, from time to time, by the Nasdaq Stock Market.

On August 19, 2024, the Company entered into an Amendment Agreement (the “August 2024 Amendment”) with the Required Holders (as defined in the Certificate of Designations). Pursuant to the August 2024 Amendment, the Required Holders agreed that (A) the unpaid and accrued dividends on the Series A Preferred Stock due July 1, 2024 (the “July Delinquent Dividend Amount”), shall be payable, at the option of the Company, in (i) cash and/or (ii) shares of Common Stock, at a price per share of Common Stock equal to the lower of (x) $1.00 and (y) the Dividend Conversion Price (as defined in the Certificate of Designations), using July 1, 2024, as the applicable date of determination in accordance with the Certificate of Designations; (B) the dividends due on October 1, 2024 (the “October Dividend Amount” and, together with the July Delinquent Dividend Amount, the “Delinquent Dividend Amounts”), shall be payable in shares of Common Stock based on a per share price of Common Stock equal to 80% of the arithmetic average of the three (3) lowest closing sale prices of the Common Stock during the month of September 2024; and (C) such Delinquent Dividend Amounts and any Dividend Balance Shares (as defined in the Certificate of Designations), with respect thereto, if applicable, shall be delivered on October 1, 2024. The Company and the Required Holders further agreed pursuant to the August 2024 Amendment to amend (i) the Certificate of Designations, as described below, by filing a Certificate of Amendment to the Certificate of Designations (the “August 2024 Certificate of Amendment”) and (ii) the Series A Purchase Agreement to amend the definition of “Excluded Securities.” The August 2024 Certificate of Amendment amends the Certificate of Designations to, among other things, (A) allow for the payment of dividends in the form of Common Stock to a holder of the Series A Preferred Stock who serves as a director, officer or employee of the Company; provided that such issuance is approved by the Company’s stockholders prior to such issuance, and (B) amend certain conditions required for (i) a mandatory conversion of the Series A Preferred Stock (as described below), and (ii) the Company’s right to redeem, all or a portion, of the Series A Preferred Stock outstanding pursuant to an optional redemption (as described below), in each case, pursuant to the terms of the Certificate of Designations.

Pursuant to the August 2024 Certificate of Amendment, the Company may require holders to convert their shares of Series A Preferred Stock into shares of Common Stock if the closing price of the Company’s Common Stock exceeds $8.00 per share (subject to adjustment for stock splits, stock dividends, stock combinations, recapitalizations or other similar events) for 20 consecutive trading days and the daily dollar trading volume of the Common Stock exceeds $2,000,000 per day during the same period, provided that certain equity conditions described in the Certificate of Designations are satisfied.

Pursuant to the August 2024 Certificate of Amendment, at any time beginning 18 months from the date of the issuance, provided that the Company has filed all reports required to be filed by it pursuant to the Exchange Act on a timely basis for a continuous period of one year and provided further that certain equity conditions described in the Certificate of Designations are satisfied, the Company has the right to redeem in cash all or some of the shares of the Series A Preferred Stock outstanding at such time at a redemption price equal to the product of (x) 125% multiplied by (y) the sum of (A) the stated value of the Series A Preferred Stock plus (B) all declared and unpaid Dividends on such Preferred Stock and any other unpaid amounts then due and payable hereunder with respect to such Series A Preferred Stock, plus (C) the make-whole amount, plus (D) any accrued and unpaid late charges with respect to such stated value and amounts payable pursuant to clause (B) as of such date of determination

On October 14, 2024, the Company entered into an Amendment Agreement with the Required Holders (as defined in the Certificate of Designations), pursuant to which, the Required Holders agreed to amend the Certificate of Designations of the Company’s Series A Preferred Stock, as described below, by filing a Certificate of Amendment to the Certificate of Designations (the “October 2024 Certificate of Amendment”). The October 2024 Certificate of Amendment amends the Certificate of Designations to, among other things, provide that, except as required by applicable law, the holders of the Series A Preferred Stock will be entitled to vote with holders of the Common Stock on an as converted basis, with the number of votes to which each holder of Series A Preferred Stock is entitled to be calculated assuming a conversion price of $1.414 per share, which was the Minimum Price (as defined in Rule 5635 of the Rule of the Nasdaq Stock Market) applicable immediately before the execution and delivery of the Series A Purchase Agreement, subject to certain beneficial ownership limitations as set forth in the Certificate of Designations. The October 2024 Certificate of Amendment further provides that (i) certain holders of the Series A Preferred Stock will not be subject to certain beneficial ownership limitations as described in the Certificate of Designations, and (ii) stockholder approval will not be required in connection with the payment of dividends in the form of Common Stock to a holder of the Series A Preferred Stock who serves as a director, officer or employee of the Company. The October 2024 Certificate of Amendment was filed with the Secretary of State of the State of Delaware, effective as of October 14, 2024.The holders of the Series A Preferred Stock have no voting rights, other than with respect to certain matters affecting the rights of the Series A Preferred Stock.

On November 25, 2024, the Company entered into an Amendment and Agreement with the Series A Investors (the “November 2024 Amendment Agreement”), pursuant to which, (i) the Series A Investors agreed to amend the Certificate of Designations, as described below, by filing a Certificate of Amendment to the Certificate of Designations with the Secretary of State (the “November 2024 Certificate of Amendment”), and (ii) the Series A Investors and the Company agreed that all payment amounts that have accrued and are unpaid as of November 25, 2024, pursuant to the Certificate of Designations and the August 2024 Amendment will be satisfied by delivery of shares of Common Stock on or prior to November 25, 2024, with each Series A Investor entitled to receive the number of shares of Common Stock specified below such Series A Investor’s name on its respective signature page thereto. The November 2024 Certificate of Amendment amends the Certificate of Designations to provide that upon the occurrence of a Triggering Event (as defined in the Certificate of Designations), the Series A Preferred Stock will accrue dividends compounded monthly at the rate of 20% per annum. The Certificate of Amendment became effective with the Secretary of State on December 6, 2024.

$2,036 of the net proceeds less transaction cost of the Series A Purchase Agreement was allocated to the Series A Preferred Stock. For the year ended December 31, 2024, authorized and declared dividends totaling $1,218 of which $60 was paid in cash $1,158 was paid in shares of the Company’s Common Stock. As of December 31, 2024, a total of 1,793 shares of Series A Preferred Stock were converted into approximately 1,468,000 shares of Common Stock. For the year ended December 31, 2023, authorized and declared dividends totaling $392, of which $58 was paid in cash, $232 was paid in shares of the Company’s Common Stock and the balance of $102 was accrued in payables as of December 31, 2023. As of December 31, 2023, 102 shares of Series A Preferred Stock were converted into approximately 77,000 shares of Common Stock.

The Company’s failure to timely file its Annual Report on Form 10-K for the year ended December 31, 2023, its Quarterly Report on Form 10-Q for the quarter ended March 31, 2024 and its Quarterly Report on Form 10-Q for the quarter ended June 30, 2024, each constituted a Triggering Event (the “Filing Triggering Events”) and equity conditions failures pursuant to the terms of the Certificate of Designations. As a result, the dividend rate of the Series A Preferred Stock was automatically increased to 20% per annum beginning on April 16, 2024, or the filing deadline of the Form 10-K for the year ended December 31, 2023, and continued until such date as the Filing Triggering Event was cured on October 15, 2024 with the filing of the Form 10-Q for the quarter ended June 30, 2024.

- Definition

The entire disclosure for equity.

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+ Details

BUSINESS COMBINATION (Tables)

12 Months Ended

Dec. 31, 2024

Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract]

SCHEDULE OF CUSTOMER RELATIONSHIPS

Customer relationships were valued using the multi-period excess earnings method under the income approach.

SCHEDULE OF CUSTOMER RELATIONSHIPS


Cash and cash equivalents	$	3
Accounts receivable		91
Inventory		61

Technology (included in Intangibles)		490
Customer relationships (included in Intangibles)		160
Trademarks and trade names (included in Intangibles)		80
Intangible assets		80
Goodwill		1,631
Total assets	$	2,516

Liabilities		24
Equity		2,492
Total liabilities and equity	$	2,516

WARRANTS

12 Months Ended

Dec. 31, 2024

Warrants

WARRANTS

10. WARRANTS

On June 29, 2023, the Company entered into a Securities Purchase Agreement (the “Series A Purchase Agreement”) with certain directors of the Company and certain accredited and institutional investors (collectively, the “Series A Investors”), pursuant to which it agreed to sell to the Series A Investors in a registered direct offering (the “Series A Offering”) (i) an aggregate of 10,000 shares of the Company’s newly-designated Series A Convertible Preferred Stock, with par value $0.0001 per share and a stated value of $1,000 per share (the “Series A Preferred Stock”), initially convertible into up to 6,896,553 shares of the Company’s Common Stock, at an initial conversion price of $1.45 per share (the “Conversion Price”), and (ii) warrants to acquire up to an aggregate of 6,896,553 shares of Common Stock (the “Series A Warrants”).

Each Series A Warrant has an exercise price of $1.45, became exercisable after the date that was six months from the date of issuance and will expire 5 years following the date of issuance. The exercise price is subject to customary adjustments for stock dividends, stock splits, reclassifications and the like, and subject to price-based adjustment, on a “full ratchet” basis, in the event of any issuances of Common Stock, or securities convertible, exercisable or exchangeable for Common Stock, at a price below the then-applicable exercise price (subject to certain exceptions). The closing of the Offering occurred on July 3, 2023. The aggregate gross proceeds from the Offering were $10,000, of which $7,717 was allocated to the Warrants. The Company expects to use the net proceeds from the Offering for general corporate purposes (see Note 4).

INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2024

Income Tax Disclosure [Abstract]

SCHEDULE OF COMPONENTS OF INCOME TAX EXPENSE (BENEFIT)

The provision/(benefit) for Income Taxes for the years ended December 31, 2024 and 2023, consists of the following:

	2024			2023
	Year Ended December 31,
	2024			2023

Current Tax Expense/(Benefit)	$	-		$	-
Deferred Tax Expense/(Benefit)		(2,712	)	$	(4,333	)
Change in Valuation Allowance		2,712			4,333
Income Tax Provision/(Benefit)	$	-		$	-

SCHEDULE OF EFFECTIVE INCOME TAX RATE RECONCILIATION

The Company’s effective income tax rate is different from the federal statutory tax rate in 2024 predominantly due to the valuation allowance, permanent differences, and state taxes. A reconciliation of the statutory U.S. Federal Tax Rate to the Company’s Effective Tax Rate is as follows:

	2024			2023
	Year Ended December 31,
	2024			2023

U.S. Statutory Federal Income Tax Rate	$	(1,234	)	$	(6,355	)
State Income Taxes, net of Federal Income tax Benefit		(67	)		(421	)
Permanent differences and other		(1,411	)		2,433
Valuation Allowance		2,712			4,333
Income Tax Provision/(Benefit)	$	-		$	-

SCHEDULE OF DEFERRED TAX ASSETS AND LIABILITIES

Deferred income taxes represent the tax effect of transactions that are reported in different periods for financial and tax reporting purposes. The combined temporary differences and carryforwards of each tax paying component of the Company that give rise to a significant portion of the deferred income tax benefits and liabilities are as follows as of December 31, 2024 and 2023:

	2024			2023
	Year Ended December 31,
	2024			2023

Deferred income tax assets:
Net operating loss carryforwards	$	18,832		$	17,002
Sec. 174 capitalization		1,931			1,494
Research and development credits		81			81
Stock Based Compensation		1,708			1,447
Accruals and Other		925			994
Total deferred tax assets (gross)		23,477			21,018
Less valuation allowance		(23,015	)		(20,302	)
Net deferred tax assets		462			716

Deferred income tax liabilities:					-
Depreciation and other		(462	)		(716	)
Net deferred tax liabilities	$	(462	)	$	(716	)
Net deferred income taxes	$	-		$	-

INVENTORIES (Tables)

12 Months Ended

Dec. 31, 2024

Inventory Disclosure [Abstract]

SCHEDULE OF INVENTORY

Inventory is recorded at the lower of cost or net realizable value. The cost of substantially all the Company’s inventory is determined by the weighted average cost method. Inventories consisted of the following:

SCHEDULE OF INVENTORY

	2024			2023
	December 31,
	2024			2023
Finished goods	$	4,387		$	3,521
Raw materials		2,263			2,738
Reserve for Obsolescence		(480	)		(465	)
Inventories – net	$	6,170		$	5,794

ACCOUNTS PAYABLE AND ACCRUED LIABILITIES (Tables)

12 Months Ended

Dec. 31, 2024

Payables and Accruals [Abstract]

SCHEDULE OF ACCRUED LIABILITIES

Accrued liabilities consist of the following:

SCHEDULE OF ACCRUED LIABILITIES

	2024		2023
	December 31,
	2024		2023
Patent and legal costs	$	60	$	21
Accrued compensation		121		325
Warranty costs		83		72
Royalty		81		14
Contract settlement		300		-
Accrued purchases		584		212
Taxes and other		174		48
Total	$	1,403	$	692

SCHEDULE OF PRODUCT WARRANTY LIABILITY

Changes in our estimated product warranty costs were as follows:

SCHEDULE OF PRODUCT WARRANTY LIABILITY

	Year Ended December 31,
	2024			2023
Balance, beginning of period	$	72		$	125
Warranty settlements		(79	)		(169	)
Warranty provision		90			116
Balance, end of period	$	83		$	72

MAJOR CUSTOMERS AND RELATED INFORMATION

12 Months Ended

Dec. 31, 2024

Risks and Uncertainties [Abstract]

MAJOR CUSTOMERS AND RELATED INFORMATION

18. MAJOR CUSTOMERS AND RELATED INFORMATION

Major Customers

For the year ended December 31, 2024, revenues from two distributors accounted for approximately 23% and 14%, respectively, of revenues with no other single customer accounting for more than 10% of total revenues. Accounts receivable from two distributors accounted for approximately 11% and 10%, respectively, of net accounts receivable and contract assets at December 31, 2024.

For the year ended December 31, 2023, revenues from one distributor accounted for approximately 37% of revenues with no other single customer accounting for more than 10% of total revenues. Accounts receivable from one distributor accounted for 67% of net accounts receivable at December 31, 2023.

The following table summarizes revenues by geographic region. Revenues are attributed to countries based on the customer’s delivery location.

SCHEDULE OF DISAGGREGATION OF REVENUE

	2024		2023
	For the Year
	Ended December 31,
	2024		2023
Americas	$	4,423	$	3,773
Europe, Middle East and Africa		76		2,302
Asia Pacific		8		58
Total revenues	$	4,507	$	6,133

See Note 1 – Concentrations of Risks for information on reliance on suppliers.

INTANGIBLE ASSETS AND GOODWILL (Tables)

12 Months Ended

Dec. 31, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

SCHEDULE OF FINITE-LIVED INTANGIBLE ASSETS

Intangible assets consisted of the following:

	2024			2023
	December 31,
	2024			2023
Amortizable intangible assets:
Patents	$	1,013		$	873
Trademarks		264			248
Purchased software and technology		1,752			1,752
Customer Relationship		160			160
Amortizable intangible assets, gross		3,189			3,033
Accumulated amortization		(1,256	)		(806	)
Total amortizable		1,933			2,227
Indefinite life assets (non-amortizable)		421			421
Total intangible assets, net	$	2,354		$	2,648

SCHEDULE OF FINITE-LIVED INTANGIBLE ASSETS, FUTURE AMORTIZATION EXPENSE

At December 31, 2024, annual amortization of intangible assets, based upon the Company’s existing intangible assets and current useful lives, is estimated to be the following:


2025	$	453
2026		366
2027		216
2028		216
2029		184
Thereafter		498
Total estimated amortization expense	$	1,933

SCHEDULE OF GOODWILL

Balance at January 1, 2024	$	1,610
Additional liabilities recorded post-acquisition		21
Impairment charge		(1,631	)
Balance at December 31, 2024	$	-

- Definition

Tabular disclosure of goodwill by reportable segment and in total which includes a rollforward schedule.

+ References

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+ Details

SCHEDULE OF INVENTORY (Details) - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Inventory Disclosure [Abstract]
Finished goods	$ 4,387	$ 3,521
Raw materials	2,263	2,738
Reserve for Obsolescence	(480)	(465)
Inventories – net	$ 6,170	$ 5,794

SCHEDULE OF GOODWILL (Details) - USD ($) $ in Thousands	1 Months Ended	12 Months Ended
SCHEDULE OF GOODWILL (Details) - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2024
Goodwill and Intangible Assets Disclosure [Abstract]
Balance at January 1, 2024		$ 1,610
Additional liabilities recorded post-acquisition		21
Goodwill, Impairment Loss	$ (1,631)	(1,631)
Balance at January 1, 2024

- Definition

Amount, after accumulated impairment loss, of asset representing future economic benefit arising from other asset acquired in business combination or from joint venture formation or both, that is not individually identified and separately recognized.

+ References

Reference 1: http://www.xbrl.org/2003/role/exampleRef
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+ Details

SUBSEQUENT EVENTS

12 Months Ended

Dec. 31, 2024

Subsequent Events [Abstract]

SUBSEQUENT EVENTS

20. SUBSEQUENT EVENTS

On January 3, 2025, the Company entered into a lease that will commence in October 2025, or upon the completion of the premises, whichever happens later, for a manufacturing facility located at Pad 1A of the technology park at the intersection of US 23 and US 58 Alternate in Norton, Virginia. The lease of the 20,000 square foot facility has an initial term of five years with the option to renew for an additional two-years, subject to adjustments based on the Consumer Price Index. Monthly lease payments will be $10,000, calculated at $6 per gross square foot per year. Following two years of occupancy from the start of the lease, we may terminate the lease without penalty by providing sixty-days written notice.

On February 18, 2025, the Company and W1 Global, LLC, a Delaware limited liability company (“Seller”), entered into an Asset Purchase Agreement, dated as of February 18, 2025 (the “W1 Purchase Agreement”), pursuant which, subject to the terms and conditions set forth therein, the Company agreed to acquire substantially all the assets of the Seller, including, among others, all of the Seller’s right, title and interest in and to the Seller’s properties, business, and assets of Seller used in, held for use in or relating to the business of advisory and investigative professional services, as more specifically set forth in the W1 Purchase Agreement (collectively, the “Acquired Assets”), which excludes the Excluded Assets (as defined in the W1 Purchase Agreement), and assume certain Assumed Liabilities (as defined in the W1 Purchase Agreement), upon the terms and subject to the conditions set forth in the W1 Purchase Agreement (the “Acquisition”), for a nominal purchase price equal to $100.00. The closing of the Acquisition occurred on February 18, 2025 (the “Closing”). In connection with Closing, the Company and the Seller entered into certain ancillary agreements, including, (i) a bill of sale for all of the Acquired Assets that are tangible personal property, (ii) an assignment of all of the Acquired Assets that are intangible personal property, (iii) employment agreements for certain employees of the Seller, and (iv) a consulting agreement.

On February 24, 2025, the Company entered into a securities purchase agreement (the “PIPE Purchase Agreement”) with certain accredited investors (collectively, the “PIPE Purchasers”) for the issuance and sale in a private placement (the “Private Placement”) of an aggregate of 3,216,666 shares (the “Common Shares”) of Common Stock and accompanying warrants (“PIPE Warrants”) to purchase up to 3,216,666 shares of Common Stock, with an exercise price of $1.80 per share. The purchase price for one Common Share and accompanying PIPE Warrant was $1.80. The estimated gross proceeds to the Company were $5.8 million, before estimated offering expenses payable by the Company.

COMMITMENTS AND CONTINGENCIES

12 Months Ended

Dec. 31, 2024

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

15. COMMITMENTS AND CONTINGENCIES

Facility Lease

In November 2023, the Company commenced a lease in an office building located at 3480 Main Highway, Coconut Grove, Florida. The lease of 4,487 square feet for an initial term of 94 months, including 5 months of rent abatement in the first two years of the lease. The aggregate monthly payments will restart in 2024 for $40 per month, increasing 3% each year through the lease term, plus other certain costs and charges as specified in the lease agreement.

Our current assembly line, and warehouse facilities are located at 1817 West 4th Street, Tempe, Arizona. The lease of 11,256 square feet commenced in June 2019 and was for an initial lease term through July 2022. In January 2022, we renewed this lease for three years with aggregate monthly payments of $10 commencing August 2022, increasing 4% annually through the term ending July 31, 2025.

Related Party Technology License Agreement

The Company is obligated to pay royalties and development and patent costs pursuant to an exclusive Amended and Restated Intellectual Property License Agreement dated as of September 30, 2016, with Syzygy, a company owned and controlled by stockholder/consultant Mr. Elwood Norris and stockholder/consultant Mr. James Barnes. The agreement provides for royalty payments of 4% of revenue from products employing the licensed ensnarement device technology up to an aggregate of $1,000 in royalties or until September 30, 2026, whichever occurs earlier. The Company recorded $66 and $199 for royalties incurred during the years ended December 31, 2024 and 2023, respectively. The maximum payout was satisfied as of June 30, 2024.

Purchase Commitments

At December 31, 2024, the Company was committed for approximately $585 for future component deliveries that are generally subject to modification or rescheduling in the normal course of business

Indemnifications and Guarantees

Our officers and directors are indemnified as to personal liability as provided by the Delaware law and the Company’s articles and bylaws. The Company may also undertake indemnification obligations in the ordinary course of business related to its operations. The Company is unable to estimate with any reasonable accuracy the liability that may be incurred pursuant to any such indemnification obligations now or in the future. Because of the uncertainty surrounding these circumstances, the Company’s current or future indemnification obligations could range from immaterial to having a material adverse impact on its financial position and its ability to continue in the ordinary course of business. The Company has no liabilities recorded for such indemnities.

Regulatory Agencies

The Company is subject to oversight from regulatory agencies regarding firearms that arises in the ordinary course of its business.

Litigation

The Company is subject to litigation and other claims in the ordinary course of business. The Company records a provision for a liability relating to legal matters when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. These provisions are reviewed and adjusted to include the impacts of negotiations, estimated settlements, legal rulings, advice of legal counsel, and other information and events pertaining to a particular matter. At December 31, 2024, we had no provision for liability under existing litigation.

SCHEDULE OF STOCK OPTION ACTIVITY (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Share-Based Payment Arrangement [Abstract]
Options Common Shares, Outstanding Beginning	4,657,635
Weighted Average Exercise Price Outstanding, Beginning	$ 2.52
Weighted Average Remaining Contractual Term, Outstanding	8 years 3 months 18 days	8 years 9 months
Aggregate Intrinsic Value, Outstanding Beginning	$ 3,979
Options Common Shares, Granted	1,613,000
Weighted Average Exercise Price, Granted	$ 2.17
Options Common Shares, Exercised	(232,081)
Weighted Average Exercise Price, Exercised	$ 2.53
Options Common Shares, Forfeited, cancelled, expired	(2,094,270)
Weighted Average Exercise Price, Forfeited/Cancelled	$ 3.00
Options Common Shares, Outstanding Ending	3,944,284,000	4,657,635
Weighted Average Exercise Price Outstanding, Ending	$ 2.12	$ 2.52
Aggregate intrinsic value, Outstanding Ending	$ 1,486	$ 3,979
Options Common Shares, Exercisable Ending	1,467,081,000
Weighted Average Exercise Price, Exercisable Ending	$ 2.89
Weighted Average Remaining Contractual Term, Exercisable	7 years 11 months 26 days
Aggregate intrinsic value, Exercisable Ending	$ 398

Consolidated Balance Sheets (Parenthetical) - $ / shares	Dec. 31, 2024	Dec. 31, 2023
Preferred stock, shares authorized	5,000,000	5,000,000
Preferred stock, par value	$ 0.0001	$ 0.0001
Common stock, shares authorized	150,000,000	150,000,000
Common stock, par value	$ 0.0001	$ 0.0001
Common stock, shares issued	47,101,631	43,855,503
Common stock, shares outstanding	47,101,631	43,855,503
Convertible Preferred Stock [Member]
Preferred stock, shares authorized	10,000	10,000
Preferred stock, par value	$ 0.0001	$ 0.0001
Preferred stock, shares issued	8,207	9,898
Preferred stock, shares outstanding	8,207	9,898

INVENTORIES

12 Months Ended

Dec. 31, 2024

Inventory Disclosure [Abstract]

INVENTORIES

5. INVENTORIES

SCHEDULE OF INVENTORY

	2024			2023
	December 31,
	2024			2023
Finished goods	$	4,387		$	3,521
Raw materials		2,263			2,738
Reserve for Obsolescence		(480	)		(465	)
Inventories – net	$	6,170		$	5,794

DEFINED CONTRIBUTION PLAN (Details Narrative) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Retirement Benefits [Abstract]
Defined contribution	$ 0	$ 0

RELATED PARTY TRANSACTIONS

12 Months Ended

Dec. 31, 2024

RELATED PARTY TRANSACTIONS

16. RELATED PARTY TRANSACTIONS

Series A Preferred Stock

On June 29, 2023, the Company entered into the Series A Purchase Agreement with certain investors, including Scot Cohen, the Company’s Chief Executive Officer, and V4 Global LLC (“V4”). Mr. Cohen has voting and dispositive control with respect to the securities as is deemed to be the beneficial owner of the securities held by V4. Pursuant to the Series A Purchase Agreement, the Company issued Mr. Cohen and V4 an aggregate of 3,000 shares of Series A Preferred Stock and Series A Warrants to purchase up to an aggregate of 2,068,966 shares of Common Stock for aggregate gross proceeds of $3,000.

Consulting Services

Commencing in October 2017, the Company began reimbursing Mr. Elwood Norris, a former officer, current 5% stockholder and consultant of the Company, $1.5 per month on a month-to-month basis for laboratory facility costs and $7.5 per month on a month-to month basis for invention consulting services, for an aggregate of $17 and $108 for the years ended December 31, 2024 and 2023, respectively. The Company terminated the contract in February 2024.

The Company is obligated to pay royalties and development and patent costs pursuant to an exclusive Amended and Restated Intellectual Property License Agreement dated September 30, 2016, with Syzygy Licensing, LLC (“Syzygy”), a company owned and controlled by a 5% stockholder of the Company, Mr. Elwood Norris, and a former officer of the Company, Mr. James Barnes. The agreement provides for royalty payments of 4% of revenue from products employing the licensed ensnarement device technology up to an aggregate of $1,000 in royalties or until September 30, 2026, whichever occurs earlier. During the years ended December 31, 2024 and 2023, the Company incurred royalties to Syzygy of $66 and $199, respectively.

Intrensic Acquisition

On August 9, 2023, the Company entered into the Intrensic Purchase Agreement with the Sellers, including Kevin Mullins, the Company’s former Chief Executive Officer. Under the terms of the Intrensic Purchase Agreement, the Company agreed to purchase, and Sellers agreed to sell, 100% of the Membership Interests of Intrensic for the following consideration upon the Intrensic Closing: (i) $554 in cash, subject to adjustment based upon the outstanding indebtedness of Intrensic and Intrensic’s working capital as of the Intrensic Closing; and (ii) 1,250,000 shares of Common Stock of the Company. The Intrensic Acquisition closed on August 16, 2023, in accordance with the terms of the Intrensic Purchase Agreement.

See Notes 8, and 15 for additional information on related party transactions and obligations.

- Definition

The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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-SubTopic 20
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+ Details

SCHEDULE OF SHORT TERM INVESTMENTS (Details) - Fair Value, Inputs, Level 1 [Member] - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Impairment Effects on Earnings Per Share [Line Items]
Adjusted cost	$ 2,945	$ 9,293
Unrealized gains
Unrealized losses
Market value	2,945	9,293
Money Market Funds [Member]
Impairment Effects on Earnings Per Share [Line Items]
Adjusted cost	2,945	1,793
Unrealized gains
Unrealized losses
Market value	$ 2,945	1,793
Certificates of Deposit [Member]
Impairment Effects on Earnings Per Share [Line Items]
Adjusted cost		7,500
Unrealized gains
Unrealized losses
Market value		$ 7,500

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Cash Flows From Operating Activities:
Net loss	$ (5,875)	$ (30,220)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	827	823
Impairment of goodwill and intangibles	1,631	700
Share-based compensation	2,433	1,985
Warranty provision	90	116
Change in fair value of warrant liabilities	(9,572)	11,986
Non-cash lease expense	292	177
Provision for doubtful accounts	(156)	180
Write off of accounts receivable	222	413
Inventory obsolescence reserve	15	465
Changes in assets and liabilities:
Accounts receivable	2,446	(696)
Inventories	(391)	(2,224)
Prepaid expenses and other current assets	775	(179)
Accounts payable	(441)	(617)
Operating lease liabilities	(91)	(160)
Customer deposits	(975)	1,002
Accrued liabilities and other	700	(344)
Warranty settlement	(79)	(169)
Deferred revenues	(39)	210
Other non-current assets	63	(151)
Net cash used in operating activities	(8,125)	(16,703)
Cash Flows From Investing Activities:
Purchases of short-term investments		(10,000)
Proceeds from maturities of short-term investments	7,500	16,355
Capital expenditures for property and equipment	(12)	(230)
Investment in patents and trademarks	(156)	(393)
Net cash paid for acquisition of Intrensic	(20)	(554)
Net cash provided by investing activities	7,312	5,178
Cash Flows From Financing Activities:
Proceeds from exercise of stock options	588	208
Proceeds from issuance of warrants and convertible preferred stock		10,000
Dividends settled in cash	(120)	(58)
Net cash provided by financing activities	468	10,150
Net decrease in cash and cash equivalents	(345)	(1,375)
Cash and cash equivalents, beginning of period	3,955	5,330
Cash and cash equivalents, end of period	3,610	3,955
Supplemental Disclosure of Non-Cash Investing and Financing Activities:
Change in unrealized gain on short-term investments		(94)
Right-of-use asset and liability recorded during period		2,109
Issuance of common stock for acquisition		1,938
Net assets acquired from acquisition		2,491
Dividends on convertible preferred stock	(1,098)	(334)
Dividends settled with common stock	$ 1,158	$ 232

PROPERTY AND EQUIPMENT

12 Months Ended

Dec. 31, 2024

Property, Plant and Equipment [Abstract]

PROPERTY AND EQUIPMENT

6. PROPERTY AND EQUIPMENT

Property and equipment consisted of the following:

SCHEDULE OF PROPERTY AND EQUIPMENT

	2024			2023
	December 31,
	2024			2023
Production and lab equipment	$	432		$	542
Tooling		570			562
Computer equipment		229			615
Furniture, fixtures and improvements		120			196
Property and equipment, gross		1,351			1,915
Accumulated depreciation		(1,205	)		(1,406	)
Property and equipment, net	$	146		$	509

Depreciation expense was $377 and $479 for the years ended December 31, 2024 and 2023, respectively.

LEASES (Tables)

12 Months Ended

Dec. 31, 2024

Leases

SCHEDULE OF OPERATING LEASE OBLIGATIONS


Operating lease liability- short term	$	567
Operating lease liability - long term		1,629
Total Operating Lease Liability	$	2,196

SCHEDULE OF OPERATING LEASE, LIABILITY, TO BE PAID, MATURITY

Future lease payments included in the measurement of lease liabilities on the balance sheet at December 31, 2023 for future periods are as follows


2025	$	567
2026		507
2027		522
2028		538
2029		554
Thereafter		717
Total future minimum lease payments		3,405
Less imputed interest		(1,209	)
Total	$	2,196

RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($)			12 Months Ended
	Aug. 16, 2023	Jun. 29, 2023	Dec. 31, 2024	Dec. 31, 2023	Aug. 09, 2023	Sep. 30, 2016
Intrensic LLC [Member]
Related Party Transaction [Line Items]
Business acquisition, percentage of voting interests acquired					100.00%
Payments to acquire businesses, gross	$ 553,588
Business acquisition, equity interest issued or issuable, number of shares	1,250,000
Executive Chairman [Member]
Related Party Transaction [Line Items]
Class of warrant or right, number of securities called by warrants or rights		2,068,966
Proceeds from issuance or sale of equity		$ 3,000,000
Executive Chairman [Member] \| Series A Preferred Stock [Member]
Related Party Transaction [Line Items]
Stock issued during period, shares, new issues		3,000
Mr Elwood Norris [Member]
Related Party Transaction [Line Items]
Reimbursement of expenses to related party, monthly amount			$ 1,500
Consulting fees to related party, monthly amount			7,500
Related party transaction, amounts of transaction			17,000	$ 108,000
Mr Elwood Norris [Member] \| Restated Intellectual Property License Agreement [Member]
Related Party Transaction [Line Items]
Royalty payments, percentage of product revenue						4.00%
Maximum royalties to be paid under agreement						$ 1,000,000
Royalty expense			$ 66,000	$ 199,000

BUSINESS COMBINATION

12 Months Ended

Dec. 31, 2024

Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract]

BUSINESS COMBINATION

19. BUSINESS COMBINATION

On August 8, 2023, the Company entered into the Intrensic Purchase Agreement with the Sellers. The Intrensic Closing occurred on August 16, 2023. Under the terms of the Intrensic Purchase Agreement, the Company agreed to purchase, and Sellers agreed to sell, the Membership Interests for the following consideration at the Intrensic Closing: (i) $554 in cash, subject to adjustment based upon the outstanding indebtedness of Intrensic and Intrensic’s working capital as of the Intrensic Closing; and (ii) 1,250,000 shares of Common Stock of the Company valued at approximately $1,938.

The Company assessed the historical financial information of Intrensic to determine if it would materially impact the Company’s historical financial statements for the purposes of disclosing proforma financial information. The Company determined that in the current or prior reporting periods the acquired business contributed immaterially to the Company’s financial statements. Therefore, a pro forma disclosure of the Company as if the business combination had occurred is not warranted under ASC 805.

The table below sets forth the allocation of the fair value of Intrensic’s net assets acquired and the corresponding line item in the Company’s consolidated balance sheet at the date of acquisition. Intangible assets were valued using established valuation techniques, as follows: Technology and trade names and trademarks were valued using the relief-from-royalty method, whereby the benefit of ownership of the intellectual property is valued as the relief from the royalty expense that would otherwise be incurred.

Customer relationships were valued using the multi-period excess earnings method under the income approach.

SCHEDULE OF CUSTOMER RELATIONSHIPS


Cash and cash equivalents	$	3
Accounts receivable		91
Inventory		61

Technology (included in Intangibles)		490
Customer relationships (included in Intangibles)		160
Trademarks and trade names (included in Intangibles)		80
Intangible assets		80
Goodwill		1,631
Total assets	$	2,516

Liabilities		24
Equity		2,492
Total liabilities and equity	$	2,516

Legal fees incurred in connection with the transaction totaled approximately $38 and have been expensed as incurred.

See Note 7 – Intangible Assets and Goodwill for December 2024 goodwill impairment charge.

SCHEDULE OF PRODUCT WARRANTY LIABILITY (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Payables and Accruals [Abstract]
Balance, beginning of period	$ 72	$ 125
Warranty settlements	(79)	(169)
Warranty provision	90	116
Balance, end of period	$ 83	$ 72

BUSINESS COMBINATION (Details Narrative) - Intrensic LLC [Member]	Aug. 16, 2023 USD ($) shares
Business Acquisition [Line Items]
Payments to acquire businesses, gross	$ 553,588
Business acquisition, equity interest issued, number of shares \| shares	1,250,000
Business combination, consideration transferred value	$ 1,938,000
Legal fees	$ 38,000

COMMITMENTS AND CONTINGENCIES (Details Narrative) $ in Thousands	1 Months Ended	12 Months Ended
	Nov. 30, 2023 USD ($) ft²	Dec. 31, 2024 USD ($)	Dec. 31, 2023 USD ($)	Aug. 31, 2022 USD ($)	Jan. 31, 2022	Jun. 30, 2019 ft²	Sep. 30, 2016 USD ($)
Lessee, Lease, Description [Line Items]
Contractual obligation		$ 585
Related Party Technology License Agreement [Member] \| Syzygy Licensing LLC [Member]
Lessee, Lease, Description [Line Items]
Royalty payments, percentage of product revenue							4.00%
Maximum royalties to be paid under agreement							$ 1,000
Royalty expense		$ 66	$ 199
Office Space In Miami Florida [Member]
Lessee, Lease, Description [Line Items]
Area of real estate property \| ft²	4,487
Lessee, operating lease, term of contract	94 months
Lessee, operating lease, rent abatement term	5 months
Lessee, operating lease, monthly liability, to be paid	$ 40
Lessee, operating lease, yearly rent increase	3.00%
Office SpaceIn Tempe Arizona [Member]
Lessee, Lease, Description [Line Items]
Area of real estate property \| ft²						11,256
Lessee, operating lease, term of contract					3 years
Lessee, operating lease, monthly liability, to be paid				$ 10
Lessee, operating lease, yearly rent increase				4.00%

SCHEDULE OF BLACK SCHOLES OPTION PRICING MODEL OF WARRANT LIABILITIES (Details)	Dec. 31, 2024	Dec. 31, 2023
Measurement Input, Price Volatility [Member]
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Expected life of warrants (years)	88	143
Measurement Input, Risk Free Interest Rate [Member]
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Expected life of warrants (years)	4.25	3.85
Measurement Input, Expected Dividend Rate [Member]
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Expected life of warrants (years)	0	0
Measurement Input, Expected Term [Member]
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Expected life of warrants (years)	3.50	4.50
Measurement Input, Exercise Price [Member]
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Expected life of warrants (years)	1.45	1.45

SCHEDULE OF CONTRACT LIABILITIES (Details) $ in Thousands	12 Months Ended
SCHEDULE OF CONTRACT LIABILITIES (Details) $ in Thousands	Dec. 31, 2024 USD ($)
Disaggregation of Revenue [Line Items]
Current portion	$ 466
Long-term portion	39
Customer Deposits [Member]
Disaggregation of Revenue [Line Items]
Balance at January 1, 2024	1,002
Additions, net	89
Transfer to revenue	(1,064)
Balance at December 31, 2024	27
Current portion	27
Long-term portion
Extended Warranties And Services VR And Training [Member]
Disaggregation of Revenue [Line Items]
Balance at January 1, 2024	544
Additions, net	856
Transfer to revenue	(895)
Balance at December 31, 2024	505
Current portion	466
Long-term portion	$ 39

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References + Details

ASSET ACQUISITIONS (Details Narrative) - USD ($)			1 Months Ended	12 Months Ended
ASSET ACQUISITIONS (Details Narrative) - USD ($)	Aug. 16, 2023	Nov. 22, 2022	Dec. 31, 2023	Dec. 31, 2024	Dec. 31, 2023	Aug. 09, 2023
Business Acquisition [Line Items]
Write off of intangibles			$ 700,000	$ 1,631,000	$ 700,000
Professional Services and Technology Acquisition Agreement [Member]
Business Acquisition [Line Items]
Cash		$ 700,000
Intrensic LLC [Member]
Business Acquisition [Line Items]
Cash	$ 553,588
Business acquisition, percentage of voting interests acquired						100.00%
Common stock shares of intrensic acquisition	1,250,000

DEFINED CONTRIBUTION PLAN

12 Months Ended

Dec. 31, 2024

Retirement Benefits [Abstract]

DEFINED CONTRIBUTION PLAN

14. DEFINED CONTRIBUTION PLAN

The Company has a defined contribution savings plan for all eligible U.S. employees established under the provisions of Section 401(k) of the Internal Revenue Code. This plan was formed on January 1, 2022. Eligible employees may contribute a percentage of their salary subject to certain limitations. The Company’s contributions for the years ended December 31, 2024 and 2023, was $0 and $0, respectively.

SCHEDULE OF STOCK OPTION ACTIVITY, FAIR VALUE OF ASSUMPTIONS (Details) - Share-Based Payment Arrangement, Option [Member] - $ / shares	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Expected stock price volatility	76.00%	76.00%
Risk-free interest rate	3.82%	4.21%
Forfeiture rate	0.00%	0.00%
Expected dividend yield	0.00%	0.00%
Expected life of options - years	6 years	6 years
Weighted-average fair value of options granted	$ 1.44	$ 1.33

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 718
-SubTopic 10
-Name Accounting Standards Codification
-Section 35
-Paragraph 1D
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480483/718-10-35-1D

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 718
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-Name Accounting Standards Codification
-Section 35
-Paragraph 3
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480483/718-10-35-3

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 718
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-Section 50
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
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Reference 11: http://www.xbrl.org/2003/role/disclosureRef
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Reference 12: http://www.xbrl.org/2003/role/disclosureRef
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Reference 13: http://www.xbrl.org/2003/role/disclosureRef
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Reference 14: http://www.xbrl.org/2003/role/disclosureRef
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Reference 18: http://www.xbrl.org/2003/role/disclosureRef
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Reference 19: http://www.xbrl.org/2003/role/disclosureRef
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Reference 24: http://www.xbrl.org/2003/role/disclosureRef
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Reference 25: http://www.xbrl.org/2003/role/disclosureRef
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Reference 26: http://www.xbrl.org/2003/role/disclosureRef
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Reference 27: http://www.xbrl.org/2003/role/disclosureRef
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-Topic 718
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-URI https://asc.fasb.org/1943274/2147480429/718-10-50-2

+ Details

INCOME TAXES

12 Months Ended

Dec. 31, 2024

Income Tax Disclosure [Abstract]

INCOME TAXES

17. INCOME TAXES

Until its reverse recapitalization on March 31, 2017, the Company was treated as a partnership for federal and state income tax purposes and did not incur income taxes. The Company accounts for income taxes under ASC 740. Deferred income tax assets and liabilities are determined based upon differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. Accounting standards require the consideration of a valuation allowance for deferred tax assets if it is “more likely than not” that some component or all of the benefits of deferred tax assets will not be realized.

The provision/(benefit) for Income Taxes for the years ended December 31, 2024 and 2023, consists of the following:

	2024			2023
	Year Ended December 31,
	2024			2023

Current Tax Expense/(Benefit)	$	-		$	-
Deferred Tax Expense/(Benefit)		(2,712	)	$	(4,333	)
Change in Valuation Allowance		2,712			4,333
Income Tax Provision/(Benefit)	$	-		$	-

	2024			2023
	Year Ended December 31,
	2024			2023

U.S. Statutory Federal Income Tax Rate	$	(1,234	)	$	(6,355	)
State Income Taxes, net of Federal Income tax Benefit		(67	)		(421	)
Permanent differences and other		(1,411	)		2,433
Valuation Allowance		2,712			4,333
Income Tax Provision/(Benefit)	$	-		$	-

	2024			2023
	Year Ended December 31,
	2024			2023

Deferred income tax assets:
Net operating loss carryforwards	$	18,832		$	17,002
Sec. 174 capitalization		1,931			1,494
Research and development credits		81			81
Stock Based Compensation		1,708			1,447
Accruals and Other		925			994
Total deferred tax assets (gross)		23,477			21,018
Less valuation allowance		(23,015	)		(20,302	)
Net deferred tax assets		462			716

Deferred income tax liabilities:					-
Depreciation and other		(462	)		(716	)
Net deferred tax liabilities	$	(462	)	$	(716	)
Net deferred income taxes	$	-		$	-

As of December 31, 2024, the Company had available federal net operating loss carryforwards of approximately $703 which begin to expire in 2037, and approximately $82.6 million which will never expire. The Company has available state net operating loss carryforwards of approximately $32.9 million as of December 31, 2024, which begin to expire in 2037. As of December 31, 2024, the Company has federal research and development tax credits of approximately $81.

The Company has provided a valuation allowance against the Company’s deferred tax assets, since, in the opinion of management, based upon the earnings history of the Company, it is not more likely than not that the benefits will be realized. All or a portion of the remaining valuation allowance may be reduced in future years based on an assessment of earnings sufficient to fully utilize these potential tax benefits.

ASC 740 addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. Under ASC 740, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely that not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The Company has no material uncertain tax positions that qualify for either recognition or disclosure in consolidated financial statements.

It is the Company’s policy to recognize interest and/or penalties related to income tax matters in income tax expense. As of December 31, 2024 and 2023, the Company has accrued no interest and no penalties related to uncertain tax positions. The Company does not have any federal, or state and local income tax returns currently under examination.

- Definition

The entire disclosure for income tax.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482685/740-10-50-12

Reference 2: http://www.xbrl.org/2003/role/exampleRef
-Topic 740
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-Name Accounting Standards Codification
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-Paragraph 231
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-URI https://asc.fasb.org/1943274/2147482663/740-10-55-231

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
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Reference 11: http://www.xbrl.org/2003/role/disclosureRef
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Reference 12: http://www.xbrl.org/2003/role/disclosureRef
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Reference 13: http://www.xbrl.org/2003/role/disclosureRef
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Reference 14: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

SCHEDULE OF FINITE-LIVED INTANGIBLE ASSETS (Details) - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Finite-Lived Intangible Assets [Line Items]
Amortizable intangible assets, gross	$ 3,189	$ 3,033
Accumulated amortization	(1,256)	(806)
Total amortizable	1,933	2,227
Indefinite life assets (non-amortizable)	421	421
Total intangible assets, net	2,354	2,648
Patents [Member]
Finite-Lived Intangible Assets [Line Items]
Amortizable intangible assets, gross	1,013	873
Trademarks [Member]
Finite-Lived Intangible Assets [Line Items]
Amortizable intangible assets, gross	264	248
Computer Software, Intangible Asset [Member]
Finite-Lived Intangible Assets [Line Items]
Amortizable intangible assets, gross	1,752	1,752
Customer Relationships [Member]
Finite-Lived Intangible Assets [Line Items]
Amortizable intangible assets, gross	$ 160	$ 160

SCHEDULE OF DEFERRED TAX ASSETS AND LIABILITIES (Details) - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Income Tax Disclosure [Abstract]
Net operating loss carryforwards	$ 18,832	$ 17,002
Sec. 174 capitalization	1,931	1,494
Research and development credits	81	81
Stock Based Compensation	1,708	1,447
Accruals and Other	925	994
Total deferred tax assets (gross)	23,477	21,018
Less valuation allowance	(23,015)	(20,302)
Net deferred tax assets	462	716
Depreciation and other	(462)	(716)
Net deferred tax liabilities	(462)	(716)
Net deferred income taxes

SCHEDULE OF OPERATING LEASE OBLIGATIONS (Details) - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Leases
Operating lease liability- short term	$ 567	$ 616
Operating lease liability - long term	1,629	$ 1,671
Total Operating Lease Liability	$ 2,196

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) $ / shares in Units, $ in Thousands	1 Months Ended		12 Months Ended
	Dec. 31, 2024 USD ($) Integer $ / shares	Dec. 31, 2023 USD ($) $ / shares	Dec. 31, 2024 USD ($) Integer $ / shares shares	Dec. 31, 2023 USD ($) $ / shares shares
Product Information [Line Items]
Common stock, par value \| $ / shares	$ 0.0001	$ 0.0001	$ 0.0001	$ 0.0001
Number of wholly-owned subsidiaries \| Integer	2		2
Short-term investments		$ 7,500		$ 7,500
Antidilutive securities excluded from computation of earnings per share, amount \| shares			4,932,386	5,468,223
Accounts receivable, allowance for credit loss	230	386	$ 230	$ 386
Inventory Valuation Reserves	$ 480	465	$ 480	465
Estimated useful lives	3 years		3 years
Fair vale on goodwill	$ 1,631		$ 1,631
Impairment of intangible assets	1,631		1,631
Impairment of intangible assets excluding goodwill		700	1,631	700
Advertising expense			575	925
Marketing expense			129	225
Cost of revenue			2,042	3,227
Revenue from contract with customer, including assessed tax			3,590	5,337
Standard product warranty accrual	$ 83	$ 72	83	72
Income tax expense (benefit)
Shipping and Handling [Member]
Product Information [Line Items]
Cost of revenue			125	200
Revenue from contract with customer, including assessed tax			$ 73	$ 37
Technology-Based Intangible Assets [Member]
Product Information [Line Items]
Finite-lived intangible asset, useful life	6 years		6 years
Customer Relationships [Member]
Product Information [Line Items]
Finite-lived intangible asset, useful life	7 years		7 years
Trademarks and Trade Names [Member]
Product Information [Line Items]
Finite-lived intangible asset, useful life	8 years		8 years

PROPERTY AND EQUIPMENT (Details Narrative) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Property, Plant and Equipment [Abstract]
Depreciation	$ 377	$ 479

SCHEDULE OF SHARE-BASED COMPENSATION FOR OPTIONS AND RESTRICTED STOCK UNITS (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total share-based expense	$ 2,433	$ 1,985
Selling, General and Administrative Expenses [Member]
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total share-based expense	2,296	1,696
Research and Development Expense [Member]
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total share-based expense	$ 137	$ 289

FINANCIAL INSTRUMENTS

12 Months Ended

Dec. 31, 2024

Investments, All Other Investments [Abstract]

FINANCIAL INSTRUMENTS

4. FINANCIAL INSTRUMENTS

Assets and liabilities recorded at fair value on a recurring basis in the Consolidated Balance Sheets and assets and liabilities measured at fair value on a non-recurring basis or disclosed at fair value, are categorized based upon the level of judgment associated with inputs used to measure their fair values. The accounting guidance for fair value provides a framework for measuring fair value and requires certain disclosures about how fair value is determined. Fair value is defined as the price that would be received upon the sale of an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date. The accounting guidance also establishes a three-level valuation hierarchy that prioritizes the inputs to valuation techniques used to measure fair value based upon whether such inputs are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect market assumptions made by the reporting entity. The three-level hierarchy for the inputs to valuation techniques is briefly summarized as follows:

Level 1—Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date;

Level 2—Inputs are observable, unadjusted quoted prices in active markets for similar assets or liabilities, unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities; and

Level 3—Unobservable inputs that are significant to the measurement of the fair value of the assets or liabilities that are supported by little or no market data.

The Company’s short-term investments consisting of US Treasury bill securities and Certificate of Deposits are classified as Level 1 because they are valued using quoted market prices.

The following table shows the Company’s short-term investments by significant investment category as of December 31, 2024 and 2023.

SCHEDULE OF SHORT TERM INVESTMENTS

	As of December 31, 2024
	Adjusted		Unrealized		Unrealized		Market
	Cost		Gains		Losses		Value
Level 1:
Money Market Funds	$	2,945	$	-	$	-	$	2,945

Total Financial Assets	$	2,945	$	-	$	-	$	2,945

	As of December 31, 2023
	Adjusted		Unrealized		Unrealized		Market
	Cost		Gains		Losses		Value
Level 1:
Money Market Funds	$	1,793	$	-	$	-	$	1,793
Certificate of Deposits		7,500		-		-		7,500
Total Financial Assets	$	9,293	$	-	$	-	$	9,293

Warrant liabilities are measured at fair value on a recurring basis. The subsequent measurement of the warrant liabilities as of December 31, 2024, is classified as Level 3 due to the use of an observable market quote in a non-active market and the management’s assumption of the expected stock price volatility.

The following table presents the fair value in the beginning of the period, the changes in the fair value, and the fair value at the end of the period of warrant liabilities:

SCHEDULE OF FAIR OF WARRANT LIABILITIES

	December 31, 2024			December 31, 2023
Level 3:
Fair value at inception for December 31, 2023 or the beginning of the period for December 31, 2024	$	(19,703	)	$	(7,717	)
Change in fair value of warrant liabilities		9,572			(11,986	)
Fair value at end of year	$	(10,131	)	$	(19,703	)

The Company uses the modified Black-Scholes option pricing model to determine the fair value of warrant liabilities. The following table summarizes the assumptions used computing the fair value of the Company’s warrants:

	As of December 31, 2024			As of December 31, 2023
Expected stock price volatility		88	%		143	%
Risk-free interest rate		4.25	%		3.85	%
Dividends yield		0	%		0	%
Expected life of warrants (years)		3.50			4.50
Exercise price	$	1.45		$	1.45

Our other financial instruments also include accounts receivable, accounts payable, accrued liabilities and business acquisition liabilities. Due to the short-term nature of these instruments, their fair values approximate their carrying values on the balance sheet.

INTANGIBLE ASSETS AND GOODWILL (Details Narrative) - USD ($) $ in Thousands	1 Months Ended		12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023	Dec. 31, 2024	Dec. 31, 2023	Aug. 31, 2023	Aug. 16, 2023
Finite-Lived Intangible Assets [Line Items]
Amortization of Intangible			$ 450	$ 345
Impairment of goodwill and intangibles		$ 700	1,631	700
Initial goodwil		$ 1,610		$ 1,610	$ 1,610
Goodwill			21
Fair value of goodwill	1,631		1,631
Impairment of intangible assets	$ 1,631		$ 1,631
Intrensic LLC [Member]
Finite-Lived Intangible Assets [Line Items]
Initial goodwil						$ 1,631
Intrensic LLC [Member] \| Trademarks [Member]
Finite-Lived Intangible Assets [Line Items]
Acquired finite-lived intangible asset, residual value					80
Intrensic LLC [Member] \| Technology-Based Intangible Assets [Member]
Finite-Lived Intangible Assets [Line Items]
Acquired finite-lived intangible asset, residual value					490
Intrensic LLC [Member] \| Customer Relationships [Member]
Finite-Lived Intangible Assets [Line Items]
Acquired finite-lived intangible asset, residual value					$ 160

MAJOR CUSTOMERS AND RELATED INFORMATION (Details Narrative) - Customer Concentration Risk [Member] - Integer	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Revenue Benchmark [Member] \| Distributors [Member]
Concentration Risk [Line Items]
Number of major customers	2	1
Revenue Benchmark [Member] \| Distributor One [Member]
Concentration Risk [Line Items]
Concentration risk, percentage	23.00%	37.00%
Revenue Benchmark [Member] \| Distributor Two [Member]
Concentration Risk [Line Items]
Concentration risk, percentage	14.00%
Accounts Receivable [Member] \| Distributor One [Member]
Concentration Risk [Line Items]
Concentration risk, percentage	11.00%	67.00%
Accounts Receivable [Member] \| Distributor Two [Member]
Concentration Risk [Line Items]
Concentration risk, percentage	10.00%

Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands	Common Stock [Member]	Preferred Stock [Member] Convertible Preferred Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	AOCI Attributable to Parent [Member]	Total
Balance at Dec. 31, 2022	$ 4		$ 94,333	$ (67,376)	$ 94	$ 27,055
Balance, shares at Dec. 31, 2022	41,175,993
Common shares issued upon exercise of stock options			208			208
Common shares issued upon exercise of stock options, shares	123,056
Share-based compensation expense			2,400			2,400
Dividends on convertible preferred stock			232	(392)		(160)
Dividends on convertible preferred stock, shares	173,654
Convertible preferred stock issued, net of offering costs			2,036			2,036
Convertible preferred stock issued, net of offering costs, shares		10,000
Common shares issued upon convertible preferred stock exercising conversion rights
Common shares issued upon convertible preferred stock exercising conversion rights, shares	76,440	(102)
Common shares issued upon vesting of restricted stock units
Common shares issued upon vesting of restricted stock units, shares	1,056,360
Issuance of common stock for acquisition			1,938			1,938
Issuance of common stock for acquisition, shares	1,250,000
Settlement – US Treasury bills					(94)	(94)
Net loss				(30,220)		(30,220)
Balance at Dec. 31, 2023	$ 4		101,147	(97,988)		3,163
Balance, shares at Dec. 31, 2023	43,855,503	9,898
Common shares issued upon exercise of stock options			588			$ 588
Common shares issued upon exercise of stock options, shares	232,081					232,081
Share-based compensation expense			2,433			$ 2,433
Dividends on convertible preferred stock			1,158	(1,218)		(60)
Dividends on convertible preferred stock, shares	1,125,300
Common shares issued upon convertible preferred stock exercising conversion rights
Common shares issued upon convertible preferred stock exercising conversion rights, shares	1,391,183	(1,691)
Common shares issued upon vesting of restricted stock units	$ 1					1
Common shares issued upon vesting of restricted stock units, shares	497,564
Net loss				(5,875)		(5,875)
Balance at Dec. 31, 2024	$ 5		$ 105,326	$ (105,081)		$ 250
Balance, shares at Dec. 31, 2024	47,101,631	8,207

SCHEDULE OF PROPERTY AND EQUIPMENT (Details) - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 1,351	$ 1,915
Accumulated depreciation	(1,205)	(1,406)
Property and equipment, net	146	509
Production And Lab Equipment [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	432	542
Tooling [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	570	562
Computer Equipment [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	229	615
Furniture and Fixtures [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 120	$ 196

MAJOR CUSTOMERS AND RELATED INFORMATION (Tables)

12 Months Ended

Dec. 31, 2024

Risks and Uncertainties [Abstract]

SCHEDULE OF DISAGGREGATION OF REVENUE

The following table summarizes revenues by geographic region. Revenues are attributed to countries based on the customer’s delivery location.

SCHEDULE OF DISAGGREGATION OF REVENUE

	2024		2023
	For the Year
	Ended December 31,
	2024		2023
Americas	$	4,423	$	3,773
Europe, Middle East and Africa		76		2,302
Asia Pacific		8		58
Total revenues	$	4,507	$	6,133

SCHEDULE OF FINITE-LIVED INTANGIBLE ASSETS, FUTURE AMORTIZATION EXPENSE (Details) - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Goodwill and Intangible Assets Disclosure [Abstract]
2025	$ 453
2026	366
2027	216
2028	216
2029	184
Thereafter	498
Total amortizable	$ 1,933	$ 2,227

LEASES (Details Narrative) - USD ($) $ in Thousands	12 Months Ended
LEASES (Details Narrative) - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Leases
Operating lease, right-of-use asset	$ 292	$ 138
Operating lease, cost	$ 644	177
Operating lease, weighted average remaining lease term	6 years 21 days
Operating lease, weighted average discount rate, percent	14.70%
Variable lease, cost	$ 109	8
Short-term lease, cost	$ 16	$ 92

INCOME TAXES (Details Narrative) - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Effective Income Tax Rate Reconciliation [Line Items]
Deferred tax assets, tax credit carryforwards, research	$ 81	$ 81
Domestic Tax Jurisdiction [Member]
Effective Income Tax Rate Reconciliation [Line Items]
Operating loss carryforward subject to expiration	703
Operating loss carryforward	82,600
State and Local Jurisdiction [Member]
Effective Income Tax Rate Reconciliation [Line Items]
Operating loss carryforward	$ 32,900

SHARE-BASED COMPENSATION (Tables)

12 Months Ended

Dec. 31, 2024

Share-Based Payment Arrangement [Abstract]

SCHEDULE OF STOCK OPTION ACTIVITY

The following table summarizes stock option activity for the year ended December 31, 2024:

SCHEDULE OF STOCK OPTION ACTIVITY

				Weighted Average
	Options on					Remaining		Aggregate
	Common			Exercise		Contractual		Intrinsic
	Shares			Price		Term		Value
Outstanding January 1, 2024		4,657,635		$	2.52		8.75	$	3,979
Granted		1,613,000		$	2.17
Exercised		(232,081	)	$	2.53
Forfeited, cancelled, expired		(2,094,270	)	$	3.00
Outstanding December 31, 2024		3,944,284		$	2.12		8.30	$	1,486
Exercisable December 31, 2024		1,467,081		$	2.89		7.99	$	398

SCHEDULE OF STOCK OPTION ACTIVITY, FAIR VALUE OF ASSUMPTIONS

The Company uses the Black-Scholes option pricing model to determine the fair value of service-based options granted. The following table summarizes the assumptions used to compute the fair value of options granted to employees and non-employees:

	For the Year Ended
	December 31,
	2024			2023
Expected stock price volatility		76	%		76	%
Risk-free interest rate		3.82	%		4.21	%
Forfeiture rate		0	%		0	%
Expected dividend yield		0	%		0	%
Expected life of options – years		6.00			6.00
Weighted-average fair value of options granted	$	1.44		$	1.33

SCHEDULE OF STOCK OPTION OUTSTANDING

The following table summarizes information about stock options outstanding at December 31, 2024:

SCHEDULE OF STOCK OPTION OUTSTANDING

			Weighted
			Average		Weighted				Weighted
			Remaining		Average				Average
Range of	Number		Contractual		Exercise		Number		Exercise
Exercise Prices	Outstanding		Life (Years)		Price		Exercisable		Price
$1.00 – $2.00		2,870,309		9.08	$	1.43		710,257	$	1.39
$2.01 – $3.00		459,000		8.95	$	2.47		291,849	$	2.45
$3.01 – $4.00		150,000		9.08	$	3.88		-	$	-
$4.01 – $5.00		91,475		6.09	$	4.38		91,475	$	4.38
$5.01 – $6.58		373,500		6.02	$	5.71		373,500	$	5.71

SCHEDULE OF RESTRICTED STOCK UNITS ACTIVITY

The Plan provides for the grant of restricted stock units (“RSUs”). RSUs are settled in shares of the Company’s Common Stock as the RSUs become vested. The following table summarizes RSU activity for the years ended December 31, 2024 and 2023:

				Weighted Average		Weighted Average
	Service-Based			Grant Date		Vesting
	RSU’s			Fair Value		Period (Years)
Unvested at January 1, 2023		922,332		$	2.88		2.11
Granted - service based		1,289,784		$	1.41
Vested		(1,056,360	)	$	1.83
Forfeited and cancelled		(345,168	)	$	2.70
Unvested at December 31, 2023		810,588		$	1.73		2.52
Granted - service based		881,004		$	2.60
Vested		(465,763	)	$	2.03
Forfeited and cancelled		(237,727	)	$	2.26
Unvested at December 31, 2024		988,102		$	2.25		3.67

SCHEDULE OF SHARE-BASED COMPENSATION FOR OPTIONS AND RESTRICTED STOCK UNITS

The Company recorded share-based compensation in its statements of operations for the relevant periods for options and RSUs as follows:

	2024		2023
	For the Year Ended
	December 31,
	2024		2023
Selling, general and administrative	$	2,296	$	1,696
Research and development		137		289
Total share-based expense	$	2,433	$	1,985

SCHEDULE OF COMPONENTS OF INCOME TAX EXPENSE (BENEFIT) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Income Tax Disclosure [Abstract]
Current Tax Expense/(Benefit)
Deferred Tax Expense/(Benefit)	(2,712)	(4,333)
Change in Valuation Allowance	2,712	4,333
Income Tax Provision/(Benefit)

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 270
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (i)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482964/270-10-50-1

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 32
-Subparagraph (ee)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-32

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482685/740-10-50-12

Reference 4: http://www.xbrl.org/2003/role/exampleRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 55
-Paragraph 231
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482663/740-10-55-231

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 250
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 9
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147483443/250-10-50-9

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SAB Topic 6.I.7)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479360/740-10-S99-1

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 250
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 8
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147483443/250-10-50-8

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 10
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482685/740-10-50-10

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 22
-Subparagraph (h)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482810/280-10-50-22

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 944
-SubTopic 220
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.7-04(9))
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147477250/944-220-S99-1

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
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Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Name Accounting Standards Codification
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-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480678/235-10-S99-1

+ Details

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Current assets:
Cash and cash equivalents	$ 3,610	$ 3,955
Short-term investments		7,500
Accounts receivable and contract assets, net	513	3,025
Inventories, net	6,170	5,794
Prepaid expense and other current assets	178	953
Total current assets	10,471	21,227
Property and equipment, net	146	509
Operating lease right-of-use assets, net	1,964	2,256
Intangible assets, net	2,354	2,648
Goodwill		1,610
Other assets	186	251
Total assets	15,121	28,501
Current liabilities:
Accounts payable	609	1,110
Accrued liabilities	1,403	692
Customer deposits	27	1,002
Deferred revenues - short term	466	407
Operating lease liabilities - short term	567	616
Warrant liabilities	10,131	19,703
Total current liabilities	13,203	23,530
Long-term liabilities:
Deferred revenues - long term	39	137
Operating lease liabilities- long term	1,629	1,671
Total long-term liabilities	1,668	1,808
Total liabilities	14,871	25,338
Commitments and contingencies
Stockholders’ equity:
Common stock - 150,000,000 authorized; par value $0.0001 per share; 47,101,631 and 43,855,503 shares issued and outstanding at December 31, 2024 and 2023, respectively	5	4
Additional paid-in capital	105,326	101,147
Accumulated deficit	(105,081)	(97,988)
Accumulated other comprehensive income
Total stockholders’ equity	250	3,163
Total liabilities and stockholders’ equity	15,121	28,501
Undesignated [Member]
Stockholders’ equity:
Preferred Stock
Convertible Preferred Stock [Member]
Stockholders’ equity:
Preferred Stock

SCHEDULE OF CUSTOMER RELATIONSHIPS (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Aug. 31, 2023	Aug. 16, 2023
Business Acquisition [Line Items]
Goodwill	$ 1,610	$ 1,610
Intrensic LLC [Member]
Business Acquisition [Line Items]
Cash and cash equivalents			$ 3
Accounts receivable			91
Inventory			61
Goodwill			1,631
Total assets			2,516
Liabilities			24
Equity			2,492
Total liabilities and equity			2,516
Intrensic LLC [Member] \| Technology-Based Intangible Assets [Member]
Business Acquisition [Line Items]
Intangible assets			490
Intrensic LLC [Member] \| Customer Relationships [Member]
Business Acquisition [Line Items]
Intangible assets			160
Intrensic LLC [Member] \| Trademarks and Trade Names [Member]
Business Acquisition [Line Items]
Intangible assets			$ 80

SUBSEQUENT EVENTS (Details Narrative) - Subsequent Event [Member]	Feb. 24, 2025 USD ($) $ / shares shares	Feb. 18, 2025 USD ($)	Jan. 03, 2025 USD ($) ft²
Subsequent Event [Line Items]
Area of land \| ft²			20,000
Lease description			initial term of five years with the option to renew for an additional two-years, subject to adjustments based on the Consumer Price Index
Lease payments			$ 10,000
Lease payments per square foot			$ 6
W1 Purchase Agreement [Member]
Subsequent Event [Line Items]
Nominal purchase price		$ 100.00
Securities Purchase Agreement [Member] \| Common Stock [Member] \| Private Placement [Member]
Subsequent Event [Line Items]
Private placement, number of shares \| shares	3,216,666
Securities Purchase Agreement [Member] \| PIPE Warrants [Member]
Subsequent Event [Line Items]
Warrants to purchase common stock, shares \| shares	3,216,666
Exercise price \| $ / shares	$ 1.80
Proceeds from issuance of warrants	$ 5,800,000

Consolidated Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Revenues:
Product sales	$ 3,590	$ 5,337
Other revenues	917	796
Total revenues	4,507	6,133
Cost of revenues	2,042	3,227
Gross profit	2,465	2,906
Operating expenses:
Selling, general and administrative	15,688	18,361
Research and development	2,344	3,267
Total operating expenses	18,032	21,628
Loss from operations	(15,567)	(18,722)
Other income (expense):
Interest income	156	375
Change in fair value of warranty liabilities	9,572	(11,986)
Other	(36)	113
Total other income (expense), net	9,692	(11,498)
Net loss	(5,875)	(30,220)
Less: convertible preferred stock dividends	(1,218)	(392)
Net loss attributable to common stockholders	$ (7,093)	$ (30,612)
Net loss per basic common share	$ (0.16)	$ (0.72)
Net loss per diluted common share	$ (0.16)	$ (0.72)
Weighted average common shares used to compute net loss per basic common share	45,621,214	42,324,190
Weighted average common shares used to compute net loss per diluted common share	45,621,214	42,324,190
Comprehensive loss:
Net loss	$ (7,093)	$ (30,612)
Comprehensive loss	$ (7,093)	$ (30,612)

REVENUES AND PRODUCT COSTS (Details Narrative) - USD ($)	Dec. 31, 2024	Dec. 31, 2023
Extended Warranties And Services VR And Training [Member]
Disaggregation of Revenue [Line Items]
Contract with customer liability	$ 505,000	$ 544,000
Contract with customer asset	0	0
Extended Warranties And Services VR And Training [Member] \| Bola Wrap [Member]
Disaggregation of Revenue [Line Items]
Contract with customer liability	76,000	139,000
Extended Product Warranties [Member] \| Intrensic [Member]
Disaggregation of Revenue [Line Items]
Contract with customer liability	352,000	216,000
Virtual Reality Training [Member]
Disaggregation of Revenue [Line Items]
Contract with customer liability	73,000	171,000
Training [Member]
Disaggregation of Revenue [Line Items]
Contract with customer liability	$ 4,000	$ 18,000

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References + Details

PROPERTY AND EQUIPMENT (Tables)

12 Months Ended

Dec. 31, 2024

Property, Plant and Equipment [Abstract]

SCHEDULE OF PROPERTY AND EQUIPMENT

Property and equipment consisted of the following:

SCHEDULE OF PROPERTY AND EQUIPMENT

	2024			2023
	December 31,
	2024			2023
Production and lab equipment	$	432		$	542
Tooling		570			562
Computer equipment		229			615
Furniture, fixtures and improvements		120			196
Property and equipment, gross		1,351			1,915
Accumulated depreciation		(1,205	)		(1,406	)
Property and equipment, net	$	146		$	509

REVENUES AND PRODUCT COSTS

12 Months Ended

Dec. 31, 2024

Revenue from Contract with Customer [Abstract]

REVENUES AND PRODUCT COSTS

2. REVENUES AND PRODUCT COSTS

Revenues consist of product sales and other revenues. Product sales include selling of BolaWrap products and accessories. Other revenues includes VR revenues, service, training and shipping revenues.

The table below details the activity in our contract liabilities during the year ended December 31, 2024.

SCHEDULE OF CONTRACT LIABILITIES

	Customer			Deferred
	Deposits			Revenue
Balance at January 1, 2024	$	1,002		$	544
Additions, net		89			856
Transfer to revenue		(1,064	)		(895	)
Balance at December 31, 2024	$	27		$	505
Current portion	$	27		$	466
Long-term portion	$	-		$	39

As of December 31, 2024, the Company’s deferred revenues of $505 consisted of $76 related to BolaWrap extended warranties and services, $352 related to Intrensic extended warranties and services, $73 related to VR and $4 related to training.

As of December 31, 2023, the Company’s deferred revenues of $544 consisted of $139 related to BolaWrap extended warranties and services, $216 related to Intrensic extended warranties and services, $171 related to VR and $18 related to training.

The Company recognizes an asset if there are incremental costs of obtaining a contract with a customer such as commissions. These costs are ascribed to or allocated to the underlying performance obligations in the contract and amortized consistent with the recognition timing of the revenue for any such underlying performance obligations. The Company had no such assets as of December 31, 2024 and 2023. The Company will apply the practical expedient to expense any sales commissions related to performance obligations with an amortization of one year or less when incurred within selling, general and administrative expense.

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 9
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-9

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 10
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-10

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 15
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-URI https://asc.fasb.org/1943274/2147479806/606-10-50-15

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
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-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-12

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
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-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-12

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-12

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-12

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (e)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-12

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (b)(2)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-13

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Name Accounting Standards Codification
-Topic 606
-Publisher FASB
-URI https://asc.fasb.org/606/tableOfContent

+ Details

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

12 Months Ended

Dec. 31, 2024

Accounting Policies [Abstract]

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization and Business Description

Wrap Technologies, Inc., a Delaware corporation (the “Company”“), is a publicly traded company with its common stock, par value $0.0001 per share (“Common Stock”), listed on the Nasdaq Capital Market (“Nasdaq”) under the trading symbol “WRAP”. The Company is a developer and supplier of public safety products and training services for law enforcement and security personnel. The Company’s primary product is the BolaWrap® remote restraint device. The principal markets for the Company’s proprietary products and services are in North and South America, Europe, Middle East and Asia.

Principles of Consolidation

The Company has two wholly owned subsidiaries, Wrap Reality, Inc., an Arizona corporation, formed in December 2020 that sells a virtual reality (“VR”) training system primarily targeting law enforcement agencies and Intrensic, LLC, which the Company acquired in August 2023, which specializes in Body Worn Camera and Digital Evidence Management solutions. The consolidated financial statements include the accounts of these subsidiaries after elimination of intercompany transactions and accounts.

Basis of Presentation and Use of Estimates

The accompanying financial statements have been prepared on the accrual basis of accounting in conformity with accounting principles generally accepted in the United States of America (“US GAAP”). The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions (e.g., share-based compensation valuation, allowance for doubtful accounts, valuation of inventory and intangible assets, warranty reserve, accrued costs, valuation allowance related to deferred tax assets and recognition and measurement of contingencies) that affect the reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities at the date of the financial statements and affect the reported amounts of revenues and expenses during the reporting period. Actual results could materially differ from those estimates.

Concentrations of Risk

Credit Risk – Financial instruments that potentially subject the Company to concentration of credit risk consisted primarily of cash, cash equivalents, US treasury bills and accounts receivable from customers. The Company maintains its cash and cash equivalent deposits at two domestic financial institutions. The Company is exposed to credit risk in the event of default by a financial institution to the extent that cash and cash equivalents are in excess of the amount insured by the Federal Deposit Insurance Corporation. The Company places its cash and cash equivalents with high-credit quality financial institutions and are managed within established guidelines to mitigate risks. To date, the Company has not experienced any losses on its cash and cash equivalents.

Concentrations of Accounts Receivable and Revenue – The Company has a limited number of domestic and international customers. The Company may experience concentrations in both accounts receivable and revenue due to the timing of sales and collections of related payments (see Note 18).

Concentration of Suppliers – The Company assembles its BolaWrap products in-house using components and subassemblies from a limited number of suppliers and contract suppliers. In particular, a single supplier is currently the sole manufacturer of the BolaWrap battery assembly, and another single supplier is the sole manufacturer of the propulsion component for BolaWrap cassettes. Other parts are solely sourced from other suppliers. If supplier shortages or logistic delays occur, or quality problems arise, production schedules could be significantly delayed or costs significantly increased, which could in turn have a material adverse effect on the Company’s financial condition, results of operation and cash flows.

Cash and Cash Equivalents

The Company considers all highly liquid investments purchased with original maturities of three months or less from the purchase date to be cash equivalents. Cash equivalents consist primarily of amounts invested in Money Market Funds and US (“US”) Treasury bills and are stated at fair value.

Short-Term Investments

The Company’s short-term investments consist of certificates of deposits and US Treasury bills with original maturities beyond three months at the date of purchase and one year or less from the balance sheet date. As of December 31, 2023, all of the Company’s short-term investments were classified as available-for-sale and are carried at estimated fair value with any unrealized gains and losses, unrelated to credit loss factors, included in other comprehensive income in our consolidated statements of stockholders’ equity. As of December 31, 2024, the Company had no short-term investments.

Share-Based Compensation

The Company follows the fair value recognition provisions issued by the FASB in ASC Topic 718, Stock Compensation (“ASC 718”) and has adopted Accounting Standards Update (“ASU”) 2018-07 for share-based transactions with non-employees. Share-based compensation expense recognized during 2024 and 2023 includes stock option and restricted stock unit compensation expense. The grant date fair value of stock options is determined using the Black-Scholes option-pricing model. The grant date is the date at which an employer and employee or non-employee reach a mutual understanding of the key terms and conditions of a share-based payment award and approved by the Company’s Board of Directors. The Black-Scholes option-pricing model requires inputs including the market price of the Company’s Common Stock on the date of grant, the term that the stock options are expected to be outstanding, the implied stock volatilities of several publicly traded peers over the expected term of stock options, risk-free interest rate and expected dividend. Each of these inputs is subjective and generally requires significant judgment to determine. The grant date fair value of restricted stock units is based upon the market price of the Company’s Common Stock on the date of the grant. The Company determines the amount of share-based compensation expense based on awards that the Company ultimately expects to vest and account for forfeitures as they occur. The fair value of share-based compensation is amortized to compensation expense over the vesting term.

Loss per Share

Basic loss per share (EPS) is computed by dividing net loss, less any dividends, accretion or decretion, redemption or induced conversion, if any, on the Company’s Series A Convertible Preferred Stock (“Series A Preferred Stock”), by the weighted average number of shares outstanding during the reported period.

In computing diluted EPS, we adjust the numerator used in the basic EPS computation, subject to anti-dilution requirements, to add back the dividends (declared or cumulative undeclared) applicable to the Series A Preferred Stock. Such add-back would also include any adjustments to equity in the period to accrete the Series A Preferred Stock to its redemption price, or recorded upon a redemption or induced conversion, if any. The Company adjusts the denominator used in the basic EPS computation, subject to anti-dilution requirements, to include the dilution from potential shares resulting from the issuance of the Series A Preferred Stock, restricted stock units, and stock options. Stock options and restricted stock units exercisable or issuable for a total of 4,932,386and 5,468,223 shares of Common Stock were outstanding at December 31, 2024 and 2023, respectively. These securities are not included in the computation of diluted net loss per common share for the periods presented as their inclusion would be antidilutive due to losses incurred by the Company.

Accounts Receivable and Allowance for Credit Losses

ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326) requires that financial assets measured at amortized cost be presented at the net amount expected to be collected. The expected credit losses are developed using an estimated loss rate method that considers historical collection experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. The estimated loss rates are applied to accounts receivables with similar risk characteristics such as the length of time the balance has been outstanding and the location of the customer. In certain instances, the Company may identify individual accounts receivable assets that do not share risk characteristics with other accounts receivables, in which case the Company records its expected credit losses on an individual asset basis. If an accounts receivable asset is evaluated on an individual basis, the Company excludes those assets from the portfolios of accounts receivables evaluated on a collective basis.

At December 31, 2024 and 2023, the Company had an allowance for credit losses related to accounts receivable of $230 and $386, respectively. If a major customer’s creditworthiness deteriorates, or actual defaults exceed our historical experience, such estimates could change and impact our future reported financial results.

Inventories

Inventories are valued at the lower of cost or net realizable value. The cost of substantially all the Company’s inventory is determined by the FIFO cost method. Inventory is comprised of raw materials, assemblies and finished products intended for sale to customers. The Company evaluates the need for reserves for excess and obsolete inventories determined primarily based upon estimates of future demand for the Company’s products.

As of December 31, 2024 and 2023, the Company had $480 and $465, respectively, in reserves for obsolescence.

Property, Equipment and Depreciation

Property and equipment are stated at cost. Depreciation on property and equipment is computed over the estimated useful lives of three years using the straight-line method. On any retirement or disposition of property and equipment, the related cost and accumulated depreciation or amortization is removed, and a gain or loss recorded.

Business Combinations

The Company accounts for its business combinations under the provisions of Accounting Standards Codification (“ASC”) Topic 805-10, Business Combinations (“ASC 805-10”), which requires that the purchase method of accounting be used for all business combinations. Assets acquired and liabilities assumed, including non-controlling interests, are recorded at the date of acquisition at their respective fair values. The estimated fair value of net assets acquired, including the allocation of the fair value to identifiable assets and liabilities, was determined using established valuation techniques. ASC 805-10 also specifies criteria that intangible assets acquired in a business combination must meet to be recognized and reported apart from goodwill. Goodwill represents the excess purchase price over the fair value of the tangible net assets and intangible assets acquired in a business combination. Acquisition-related expenses are recognized separately from the business combinations and are expensed as incurred.

The estimated fair value of the acquired intangible assets was determined using a method which reflects the present value of the operating cash flows generated by this asset after taking into account the cost to realize the revenue, and an appropriate discount rate to reflect the time value and risk associated with the invested capital.

Certain adjustments to the assessed fair values of the assets and liabilities made subsequent to the acquisition date, but within the measurement period, which is up to one year, are recorded as adjustments to goodwill. Any adjustments subsequent to the measurement period are recorded in income.

Goodwill

Goodwill represents the difference, if any, between the aggregate consideration paid for an acquisition and the fair values of the underlying net assets and liabilities assumed from an acquired business. Goodwill is not amortized, but instead is tested for impairment. The Company tests goodwill for impairment on an annual basis during the fourth quarter, or more frequently if conditions indicate that such impairment could exist. The Company evaluates qualitative factors to determine if it is more likely than not that the fair value of a reporting unit is less than its carrying value and whether it is necessary to perform goodwill impairment process.

Definite-lived Intangible Assets

Definite-lived intangible assets represent certain trade names, patents, licenses, software, acquired technology and customer relationships. Definite-lived intangible assets are recorded at cost less any accumulated amortization and accumulated impairment losses, if any. Definite-lived intangible assets acquired through the business combination are measured at fair value at the acquisition date. The Company amortizes these acquired definite-lived intangibles assets with a finite life on a straight-line basis, over 6 years for technology; 7 years for customer relationships; and 8 years for trademarks and trade names.

Intangible Assets

Intangible assets consist of (a) capitalized legal fees and filing costs related to obtaining patents and trademarks, (b) tradenames and software, (c) purchased software, and (d) the purchase cost of indefinite-lived website domains. The estimated useful lives of identifiable intangible assets with definite useful lives have been estimated to be between one and twenty years. Purchased website domain costs with an indefinite useful life are not subject to amortization, but are subject to an annual impairment test, by comparing their carrying amount with their corresponding fair value. For any given intangible asset with an indefinite useful life, if its fair value exceeds its carrying amount no impairment loss shall be recognized.

The carrying value of intangibles is periodically reviewed and impairments, if any, are recognized when the future undiscounted cash flows realized from the assets is less than its carrying value.

Impairment of Long-Lived Assets

Long-lived assets and identifiable intangibles held for use are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If the sum of undiscounted expected future cash flows is less than the carrying amount of the asset or if changes in facts and circumstances indicate, an impairment loss is recognized and measured using the asset’s fair value. In December 2024, the Company determined that the assessment of the Intrensic unit’s fair value indicated that its carrying value exceeded its fair value by $1,631 and therefore the Company recorded a $1,631 impairment charge related to the goodwill initially recorded from the acquisition. In December 2023, it was determined that the intangible related to development of proprietary software by Lumeto, Inc. would not have future economic value and was written down; the Company recognized an impairment loss of $700.

Warrants

The Company accounts for warrants as liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 480, Distinguishing Liabilities from Equity (“ASC 480”) and ASC 815, Derivatives and Hedging (“ASC 815”). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own common stock and whether the warrant holders could potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding.

For issued warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded at their initial fair value on the date of issuance, and each balance sheet date thereafter. The Company accounts for the warrants issued in accordance with the guidance contained in ASC 815-40-15-7C, under which the warrants do not meet the criteria for equity treatment and must be recorded as liabilities. Accordingly, the Company classifies the warrants as liabilities at their fair value and adjusts the warrants to fair value at each reporting period. This liability is subject to re-measurement at each balance sheet date until exercised, and any change in fair value is recognized in the Company’s condensed consolidated statement of operations.

Convertible Preferred Stocks

The Company evaluates and accounts for conversion options embedded in its convertible instruments in accordance with ASC 480 and ASC 815 to determine if those instruments or embedded components of those instruments qualify as derivatives and are subject to bifurcation accounting. The Company determines that the economic characteristics and risks of the embedded derivative instrument are clearly and closely related to the economic characteristics and risks of the host contract. The convertible instruments are accounted for as a single hybrid instrument. Additionally, the convertible instruments do not have any redemption features that would preclude permanent equity classification in accordance with the guidance contained in ASC 480-10-S99.

Advertising and Promotion Costs

Advertising costs are charged to expense as incurred and were $575 and $925 for the years ended December 31, 2024 and 2023, respectively. The Company also incurred product promotion costs for demonstration products delivered to prospective customers of $129 and $225 for the years ended December 31, 2024, and 2023, respectively. Advertising and promotion costs are included in selling, general and administrative expenses in the accompanying statements of operations.

Demonstration and Training Costs

The Company maintains a demonstration and training department as a part of its sales and marketing activities and does not charge for product demonstrations or training. Training is not a condition or requirement of sale as most sales are made through distributors to their end customers. The Company conducts local and regional in-person, webinar and on-line demonstrations and use of force and escalation training to support law enforcement agencies with no purchase requirement. Such training, when provided, may occur before or after initial or subsequent purchase or field deployment of the Company’s products. The Company believes that law enforcement trainers and officers that have seen demonstrations or have been trained about its products are more supportive of their departments purchase and deployment of product.

Research and Development Costs

Research and development costs are expensed as incurred.

Contract Manufacturers

The Company employs contract manufacturers for production of certain components and sub-assemblies. The Company may provide parts and components to such parties from time to time but recognizes no revenue or markup on such transactions.

Leases

The Company adopted ASC Topic 842, Leases (“Topic 842”) on January 1, 2019. In accordance with the guidance in Topic 842, the Company recognizes lease liabilities and corresponding right-of-use-assets for all leases with terms of greater than 12 months. Leases with a term of 12 months or less will be accounted for in a manner similar to the guidance for operating leases prior to the adoption of Topic 842. Refer to Note 9, Leases for more information.

Revenue Recognition

The Company adopted ASC Topic 606, Revenue from Contracts with Customers on January 1, 2018. The Company enters into contracts that include various combinations of products, accessories, software and services, each of which are generally distinct and are accounted for as separate performance obligations. Product sales include BolaWrap products and accessories. Other revenue includes VR revenues, service, training and shipping revenues.

The timing of revenue recognition may differ from the timing of invoicing to customers. The Company generally has an unconditional right to consideration when customers are invoiced, and a receivable is recorded. A contract asset is recognized when revenue is recognized prior to invoicing, or a contract liability (deferred revenue) when revenue will be recognized subsequent to invoicing. The Company recognizes an asset if there are incremental costs of obtaining a contract with a customer such as commissions. These costs are ascribed to or allocated to the underlying performance obligations in the contract. The Company may receive consideration, per terms of a contract, from customers prior to transferring goods to the customer. The Company records customer deposits as a contract liability. Additionally, the Company may receive payments, most typically for service and warranty contracts, at the onset of the contract and before the services have been performed. In such instances, a deferred revenue liability is recorded. The Company recognizes these contract liabilities as revenue after all revenue recognition criteria are met.

Estimated costs for the Company’s standard warranty, generally one-year, are charged to cost of products sold when revenue is recorded for the related product. Royalties are also charged to cost of products sold.

Shipping and Handling Costs

Shipping and handling costs are included in cost of revenues. Shipping and handling costs invoiced to customers are included in revenue. Actual shipping and handling costs were $125 and $200 for the years ended December 31, 2024 and 2023, respectively. Actual revenues from shipping and handling were $73 and $37 for the years ended December 31, 2024 and 2023, respectively.

Warranty Reserves

The Company warrants its products and accessories to be free from defects in materials and workmanship for a period of one year from the date of purchase. The warranty is generally limited. The Company currently provides direct warranty service. International market warranties are generally similar to the US market.

The Company establishes a warranty reserve based on anticipated warranty claims at the time product revenues are recognized. Factors affecting warranty reserve levels include the number of units sold, anticipated cost of warranty repairs and anticipated rates of warranty claims. The Company evaluates the adequacy of the provision for warranty costs each reporting period. The warranty reserve was $83 and $72 at December 31, 2024 and 2023. Actual warranty costs could differ from estimates.

Segment Information

ASC Topic 280, “Segment Reporting,” requires use of the “management approach” model for segment reporting. The management approach model is based on the way a company’s management organizes segments within the company for making operating decisions and assessing performance. The Company operates as a single segment and will evaluate additional segment disclosure requirements as it expands its operations.

Income Taxes

No income tax expense was recorded for the periods ended December 31, 2024 and 2023, due to losses incurred. Deferred tax assets and liabilities are determined based on temporary differences between the bases of certain assets and liabilities for income tax and financial reporting purposes.

The Company maintains a valuation allowance with respect to deferred tax assets. The Company establishes a valuation allowance based upon the potential likelihood of realizing the deferred tax asset and taking into consideration the Company’s financial position and results of operations for the current period. Future realization of the deferred tax benefit depends on the existence of sufficient taxable income within the carry-forward period under the Federal tax laws. Changes in circumstances, such as the Company generating taxable income, could cause a change in judgment about the realizability of the related deferred tax asset. Any change in the valuation allowance will be included in income in the year of the change in estimates.

Recently Issued Accounting Guidance

On December 14, 2023, the FASB issued a final standard on improvements to income tax disclosures. The standard requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid. The standard is intended to benefit investors by providing more detailed income tax disclosures that would be useful in making capital allocation decisions. ASU 2023-09, Improvements to Income Tax Disclosures, applies to all entities subject to income taxes. For public business entities (PBEs), the new requirements will be effective for annual periods beginning after December 15, 2024. The guidance will be applied on a prospective basis with the option to apply the standard retrospectively. The Company does not plan to early adopt this standard.

On March 21, 2024, the FASB issued ASU 2024-01 to clarify the scope application of profits interest and similar awards by adding illustrative guidance in ASC 718, Compensation - Stock Compensation. For PBEs, the amendments in this Update are effective for annual periods beginning after December 15, 2024, and interim periods within those annual periods. The Company does not plan to early adopt this standard.

The Company has reviewed recently issued, but not yet effective, accounting pronouncements and does not believe the future adoptions of any such pronouncements will be expected to cause a material impact on its financial condition or the results of operations.

WARRANTS (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands	Jul. 03, 2023	Jun. 29, 2023	Dec. 31, 2024	Oct. 14, 2024	Dec. 31, 2023
Preferred stock, par or stated value per share			$ 0.0001		$ 0.0001
Warrants Issued In Registered Direct Offering [Member]
Class of warrant or right, number of securities		6,896,553
Class of warrant, exercise price		$ 1.45
Warrants and rights outstanding, term		5 years
Registered Direct Offering [Member]
Proceeds from issuance or sale of equity	$ 10,000
Proceeds from issuance of warrants	$ 7,717
Series A Preferred Stock [Member]
Preferred stock, convertible, conversion price	$ 1.45			$ 1.414
Series A Preferred Stock [Member] \| Registered Direct Offering [Member]
Stock issued during period, shares, new issues		10,000
Preferred stock, par or stated value per share		$ 0.0001
Preferred stock, stated value per share		$ 1,000
Preferred stock, convertible, shares issuable		6,896,553
Preferred stock, convertible, conversion price		$ 1.45

LEASES

12 Months Ended

Dec. 31, 2024

Leases

LEASES

9. LEASES

The Company determines if an arrangement is a lease at inception. The guidance in FASB ASC Topic 842, Leases defines a lease as a contract, or part of a contract, that conveys the right to control the use of identified property, plant, or equipment (an identified asset) for a period of time in exchange for consideration. Operating lease right of use (“ROU”) assets and lease liabilities are recognized based on the present value of future minimum lease payments over the lease term at commencement date. The Company’s leases do not provide an implicit rate. Due to a lack of financing history or ability, the Company uses an estimate of low-grade debt rate published by the Federal Reserve Bank as its incremental borrowing rate based on the information available at the commencement date in determining the present value of future payments. The ROU asset includes any lease payments made and excludes lease incentives and initial direct costs incurred.

For leases beginning on or after January 1, 2019, lease components are accounted for separately from non-lease components for all asset classes. On January 21, 2023, the Company’s lease was amended to extend the expiration date to July 31, 2025. Upon execution of the amendment, which was deemed a lease modification, the Company reassessed the lease liability using the discount rate determined at the modification date and recorded an additional ROU asset for the same amount. The Company’s lease contains renewal provisions and escalating rental clauses and generally requires the Company to pay for utilities, insurance, taxes and other operating expenses. The renewal provisions of the existing lease agreement were not included in the determination of the operating lease liabilities and the ROU assets. The Company also reassessed the lease classification and concluded that the lease continues to be an operating lease.

Amortization of ROU operating lease assets was $292 and $138 for the years ended December 31, 2024 and 2023, respectively.

Operating lease expense for capitalized operating leases included in operating activities was $644 and $177 for the years ended December 31, 2024 and 2023, respectively. Operating lease obligations recorded on the balance sheet at December 31, 2024 are:

SCHEDULE OF OPERATING LEASE OBLIGATIONS


Operating lease liability- short term	$	567
Operating lease liability - long term		1,629
Total Operating Lease Liability	$	2,196

Future lease payments included in the measurement of lease liabilities on the balance sheet at December 31, 2023 for future periods are as follows


2025	$	567
2026		507
2027		522
2028		538
2029		554
Thereafter		717
Total future minimum lease payments		3,405
Less imputed interest		(1,209	)
Total	$	2,196

The weighted average remaining lease term is 6.06 years, and the weighted average discount rate is 14.7%.

Certain leases contain provisions for payment of real estate taxes, insurance and maintenance costs by the Company. These expenses are treated as variable lease payments and recognized in the period in which the obligation for those payments was incurred. The Company had $109 and $8 variable lease expenses during the year December 31, 2024 and 2023, respectively.

The Company had $16 and $92 short-term lease expense during the year December 31, 2024, and 2023 respectively. The Company does not have any finance leases.

SCHEDULE OF DISAGGREGATION OF REVENUE (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Total revenues	$ 4,507	$ 6,133
Americas [Member]
Total revenues	4,423	3,773
Europe Middle East and Africa [Member]
Total revenues	76	2,302
Asia Pacific [Member]
Total revenues	$ 8	$ 58

- Definition

Amount of revenue recognized from goods sold, services rendered, insurance premiums, or other activities that constitute an earning process. Includes, but is not limited to, investment and interest income before deduction of interest expense when recognized as a component of revenue, and sales and trading gain (loss).

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+ Details

DEBT

12 Months Ended

Dec. 31, 2024

Debt Disclosure [Abstract]

DEBT

11. DEBT

The Company’s debt at December 31, 2024 and 2023 included operating lease liabilities (see Note 9).

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

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+ Details

Insider Trading Arrangements	3 Months Ended
Insider Trading Arrangements	Dec. 31, 2024
Insider Trading Arrangements [Line Items]
No Insider Trading Flag	true

SCHEDULE OF OPERATING LEASE, LIABILITY, TO BE PAID, MATURITY (Details) $ in Thousands	Dec. 31, 2024 USD ($)
Leases
2025	$ 567
2026	507
2027	522
2028	538
2029	554
Thereafter	717
Total future minimum lease payments	3,405
Less imputed interest	(1,209)
Total	$ 2,196

Pay vs Performance Disclosure - USD ($) $ in Thousands	12 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Pay vs Performance Disclosure [Table]
Net Income (Loss)	$ (5,875)	$ (30,220)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

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+ Details

SCHEDULE OF RESTRICTED STOCK UNITS ACTIVITY (Details) - Restricted Stock Units (RSUs) [Member] - $ / shares	1 Months Ended		12 Months Ended
	Jan. 31, 2024	Oct. 31, 2023	Dec. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Service-Based Restricted Stock Units, Unvested Beginning	810,588		810,588	922,332
Weighted Average Grant Date Fair Value, Unvested Beginning	$ 1.73		$ 1.73	$ 2.88
Weighted Average Vesting Period (Years), Unvested			3 years 8 months 1 day	2 years 6 months 7 days	2 years 1 month 9 days
Number of Restricted Stock Units, Granted - service based	632,911	482,143	881,004	1,289,784
Weighted Average Grant Date Fair Value, Granted - service based			$ 2.60	$ 1.41
Service-Based Restricted Stock Units, Vested			(465,763)	(1,056,360)
Weighted Average Grant Date Fair Value, Vested			$ 2.03	$ 1.83
Service-Based Restricted Stock Units, Forfeited and Cancelled			(237,727)	(345,168)
Weighted Average Grant Date Fair Value, Forfeited and Cancelled			$ 2.26	$ 2.70
Service-Based Restricted Stock Units, Unvested Ending			988,102	810,588	922,332
Weighted Average Grant Date Fair Value, Unvested Ending			$ 2.25	$ 1.73	$ 2.88

FINANCIAL INSTRUMENTS (Tables)

12 Months Ended

Dec. 31, 2024

Investments, All Other Investments [Abstract]

SCHEDULE OF SHORT TERM INVESTMENTS

The following table shows the Company’s short-term investments by significant investment category as of December 31, 2024 and 2023.

SCHEDULE OF SHORT TERM INVESTMENTS

	As of December 31, 2024
	Adjusted		Unrealized		Unrealized		Market
	Cost		Gains		Losses		Value
Level 1:
Money Market Funds	$	2,945	$	-	$	-	$	2,945

Total Financial Assets	$	2,945	$	-	$	-	$	2,945

	As of December 31, 2023
	Adjusted		Unrealized		Unrealized		Market
	Cost		Gains		Losses		Value
Level 1:
Money Market Funds	$	1,793	$	-	$	-	$	1,793
Certificate of Deposits		7,500		-		-		7,500
Total Financial Assets	$	9,293	$	-	$	-	$	9,293

SCHEDULE OF FAIR OF WARRANT LIABILITIES

The following table presents the fair value in the beginning of the period, the changes in the fair value, and the fair value at the end of the period of warrant liabilities:

SCHEDULE OF FAIR OF WARRANT LIABILITIES

	December 31, 2024			December 31, 2023
Level 3:
Fair value at inception for December 31, 2023 or the beginning of the period for December 31, 2024	$	(19,703	)	$	(7,717	)
Change in fair value of warrant liabilities		9,572			(11,986	)
Fair value at end of year	$	(10,131	)	$	(19,703	)

SCHEDULE OF BLACK SCHOLES OPTION PRICING MODEL OF WARRANT LIABILITIES

	As of December 31, 2024			As of December 31, 2023
Expected stock price volatility		88	%		143	%
Risk-free interest rate		4.25	%		3.85	%
Dividends yield		0	%		0	%
Expected life of warrants (years)		3.50			4.50
Exercise price	$	1.45		$	1.45

REVENUES AND PRODUCT COSTS (Tables)

12 Months Ended

Dec. 31, 2024

Revenue from Contract with Customer [Abstract]

SCHEDULE OF CONTRACT LIABILITIES

The table below details the activity in our contract liabilities during the year ended December 31, 2024.

SCHEDULE OF CONTRACT LIABILITIES

	Customer			Deferred
	Deposits			Revenue
Balance at January 1, 2024	$	1,002		$	544
Additions, net		89			856
Transfer to revenue		(1,064	)		(895	)
Balance at December 31, 2024	$	27		$	505
Current portion	$	27		$	466
Long-term portion	$	-		$	39

ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

12 Months Ended

Dec. 31, 2024

Payables and Accruals [Abstract]

ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

8. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

We are obligated to pay royalties pursuant to an exclusive Amended and Restated Intellectual Property License Agreement (the “License Agreement”), dated as of September 30, 2016, with Syzygy Licensing, LLC (“Syzygy”), a private technology invention, consulting and licensing company owned and controlled by Elwood G. Norris, a founder and former officer and current 5% stockholder of the Company, and James A. Barnes, a former officer and stockholder of the Company (see Note 16).

Accrued liabilities include $81 and $14 due to Syzygy pursuant to the License Agreement as of December 31, 2024 and 2023, respectively.

Accrued liabilities consist of the following:

SCHEDULE OF ACCRUED LIABILITIES

	2024		2023
	December 31,
	2024		2023
Patent and legal costs	$	60	$	21
Accrued compensation		121		325
Warranty costs		83		72
Royalty		81		14
Contract settlement		300		-
Accrued purchases		584		212
Taxes and other		174		48
Total	$	1,403	$	692

Changes in our estimated product warranty costs were as follows:

SCHEDULE OF PRODUCT WARRANTY LIABILITY

	Year Ended December 31,
	2024			2023
Balance, beginning of period	$	72		$	125
Warranty settlements		(79	)		(169	)
Warranty provision		90			116
Balance, end of period	$	83		$	72

ACCOUNTS PAYABLE AND ACCRUED LIABILITIES (Details Narrative) - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Syzygy Licensing LLC [Member]
Defined Benefit Plan Disclosure [Line Items]
Accounts payable	$ 81	$ 14

SCHEDULE OF ACCRUED LIABILITIES (Details) - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Payables and Accruals [Abstract]
Patent and legal costs	$ 60	$ 21
Accrued compensation	121	325
Warranty costs	83	72
Royalty	81	14
Contract settlement	300
Accrued purchases	584	212
Taxes and other	174	48
Total	$ 1,403	$ 692

SHARE-BASED COMPENSATION

12 Months Ended

Dec. 31, 2024

Share-Based Payment Arrangement [Abstract]

SHARE-BASED COMPENSATION

13. SHARE-BASED COMPENSATION

On March 31, 2017, the Company adopted, and the stockholders approved, the 2017 Stock Incentive Plan (the “Plan”) authorizing 2,000,000 shares of Common Stock for issuance as awards to employees, directors or consultants. In May 2019, the stockholders authorized an increase in the Plan authorizing an additional 2,100,000 shares of Common Stock, in June 2020 authorized an additional 1,900,000 shares of Common Stock, in June 2021 authorized an additional 1,500,000 shares of Common Stock, in June 2022 authorized an additional 1,500,000 shares of Common Stock, in December 2024 authorized an additional 7,500,000 shares of Common Stock for a total of 16,500,000 shares subject to the Plan. At December 31, 2024, there were 7,585,545 shares of Common Stock remaining available for grant under the Plan.

The Company generally recognizes share-based compensation expense on the grant date and over the period of vesting or period that services will be provided. In April 2023, the Company recognized severance acceleration of $112 of share-based compensation expense resulting from the resignation of the Company’s former Chief Executive Officer and Chief Operating Officer due to a reduction in force that resulted in changes in the composition of the executives of the Company.

Stock Options

The following table summarizes stock option activity for the year ended December 31, 2024:

SCHEDULE OF STOCK OPTION ACTIVITY

				Weighted Average
	Options on					Remaining		Aggregate
	Common			Exercise		Contractual		Intrinsic
	Shares			Price		Term		Value
Outstanding January 1, 2024		4,657,635		$	2.52		8.75	$	3,979
Granted		1,613,000		$	2.17
Exercised		(232,081	)	$	2.53
Forfeited, cancelled, expired		(2,094,270	)	$	3.00
Outstanding December 31, 2024		3,944,284		$	2.12		8.30	$	1,486
Exercisable December 31, 2024		1,467,081		$	2.89		7.99	$	398

At December 31, 2024, there were 2,654,118 service-based stock options outstanding, and 1,290,166 performance-based stock options outstanding, 1,290,166 were granted in October 2023 to the Company’s Chief Executive Officer, the vesting of which is subject to future market capitalization targets.

	For the Year Ended
	December 31,
	2024			2023
Expected stock price volatility		76	%		76	%
Risk-free interest rate		3.82	%		4.21	%
Forfeiture rate		0	%		0	%
Expected dividend yield		0	%		0	%
Expected life of options – years		6.00			6.00
Weighted-average fair value of options granted	$	1.44		$	1.33

Estimated volatility is a measure of the amount by which the Company’s stock price is expected to fluctuate each year during the expected life of awards. The Company’s estimated volatility was based on an average of the historical volatility of peer entities whose stock prices were publicly available. The Company’s calculation of estimated volatility is based on historical stock prices of these peer entities over a period equal to the expected life of the awards. The Company uses the historical volatility of peer entities due to the lack of sufficient historical data of its stock price. The Company records forfeitures as they are incurred.

The risk-free interest rate assumption is based upon observed interest rates on zero coupon U.S. Treasury bonds whose maturity period is appropriate for the term of the options. The dividend yield of zero is based on the fact that the Company has never paid cash dividends and has no present intention to pay cash dividends. The Company calculates the expected life of the options using the Simplified Method for the employee stock options as the Company does not have sufficient historical exercise data.

The Company used the Monte Carlo Simulation Model to value at the grant date the aggregate of 1,290,166 market condition performance options granted in October 2023 to the Company’s Chief Executive Officer. The assumptions used in the Monte Carlo Simulation were stock price on date of grant of $1.40, contract term of 10 years, expected volatility of 76% and risk-free interest rate of 4.65 %. Vesting is based on sustained market capitalization of $100 million, $150 million and $200 million and expected to be exercised at the midpoint of the vesting period resulted in implied service periods ranging from approximately 1 to 3 years.

Stock option expense was $1,132 and $967 for the years ended December 31, 2024 and 2023, respectively.

The following table summarizes information about stock options outstanding at December 31, 2024:

SCHEDULE OF STOCK OPTION OUTSTANDING

			Weighted
			Average		Weighted				Weighted
			Remaining		Average				Average
Range of	Number		Contractual		Exercise		Number		Exercise
Exercise Prices	Outstanding		Life (Years)		Price		Exercisable		Price
$1.00 – $2.00		2,870,309		9.08	$	1.43		710,257	$	1.39
$2.01 – $3.00		459,000		8.95	$	2.47		291,849	$	2.45
$3.01 – $4.00		150,000		9.08	$	3.88		-	$	-
$4.01 – $5.00		91,475		6.09	$	4.38		91,475	$	4.38
$5.01 – $6.58		373,500		6.02	$	5.71		373,500	$	5.71

Restricted Stock Units

				Weighted Average		Weighted Average
	Service-Based			Grant Date		Vesting
	RSU’s			Fair Value		Period (Years)
Unvested at January 1, 2023		922,332		$	2.88		2.11
Granted - service based		1,289,784		$	1.41
Vested		(1,056,360	)	$	1.83
Forfeited and cancelled		(345,168	)	$	2.70
Unvested at December 31, 2023		810,588		$	1.73		2.52
Granted - service based		881,004		$	2.60
Vested		(465,763	)	$	2.03
Forfeited and cancelled		(237,727	)	$	2.26
Unvested at December 31, 2024		988,102		$	2.25		3.67

482,143 of the RSUs granted included in the table above were granted in October 2023 are performance based RSUs, and 632,911 are performance based RSUs that were granted in January 2024, both subject to vesting terms based on future market capitalization.

RSU expense was $1,301 and $1,018 for the years ended December 31, 2024 and 2023, respectively.

Share-Based Compensation Expense

The Company recorded share-based compensation in its statements of operations for the relevant periods for options and RSUs as follows:

	2024		2023
	For the Year Ended
	December 31,
	2024		2023
Selling, general and administrative	$	2,296	$	1,696
Research and development		137		289
Total share-based expense	$	2,433	$	1,985

As of December 31, 2024, total estimated compensation cost of stock options granted and outstanding but not yet vested was $2,304 which is expected to be recognized over the weighted average period of 2.27 years.

As of December 31, 2024, total estimated compensation cost of RSUs granted and outstanding but not yet vested was $1,630 which is expected to be recognized over the weighted average period of 3.03 years.

SCHEDULE OF FAIR OF WARRANT LIABILITIES (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Platform Operator, Crypto Asset [Line Items]
Change in fair value of warrant liabilities	$ (9,572)	$ 11,986
Fair Value, Inputs, Level 3 [Member]
Platform Operator, Crypto Asset [Line Items]
Fair value at inception for December 31, 2023 or the beginning of the period for December 31, 2024	(19,703)	(7,717)
Change in fair value of warrant liabilities	9,572	(11,986)
Fair value at end of year	$ (10,131)	$ (19,703)

SCHEDULE OF EFFECTIVE INCOME TAX RATE RECONCILIATION (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Income Tax Disclosure [Abstract]
U.S. Statutory Federal Income Tax Rate	$ (1,234)	$ (6,355)
State Income Taxes, net of Federal Income tax Benefit	(67)	(421)
Permanent differences and other	(1,411)	2,433
Valuation Allowance	2,712	4,333
Income Tax Provision/(Benefit)

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References

+ Details

Insider Trading Policies and Procedures	12 Months Ended
Insider Trading Policies and Procedures	Dec. 31, 2024
Insider Trading Policies and Procedures [Line Items]
Insider Trading Policies and Procedures Adopted	true

INTANGIBLE ASSETS AND GOODWILL

12 Months Ended

Dec. 31, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

INTANGIBLE ASSETS AND GOODWILL

7. INTANGIBLE ASSETS AND GOODWILL

Intangible Assets

Intangible assets consisted of the following:

	2024			2023
	December 31,
	2024			2023
Amortizable intangible assets:
Patents	$	1,013		$	873
Trademarks		264			248
Purchased software and technology		1,752			1,752
Customer Relationship		160			160
Amortizable intangible assets, gross		3,189			3,033
Accumulated amortization		(1,256	)		(806	)
Total amortizable		1,933			2,227
Indefinite life assets (non-amortizable)		421			421
Total intangible assets, net	$	2,354		$	2,648

Amortization expenses were $450 and $345 for the years ended December 31, 2024 and 2023, respectively.

The Intrensic Acquisition in August 2023 resulted in several intangible assets recognized on the balance sheet including $80 in trademarks, $490 in purchased technology and $160 in customer relationships.

The Company determined in December 2023 that the intangible related to software developed by Lumeto would not have future economic benefit and the value of the intangible was written down, incurring a loss on impairment of $700.

At December 31, 2024, annual amortization of intangible assets, based upon the Company’s existing intangible assets and current useful lives, is estimated to be the following:


2025	$	453
2026		366
2027		216
2028		216
2029		184
Thereafter		498
Total estimated amortization expense	$	1,933

Goodwill

The Company recorded an initial goodwill of $1,610 related to the purchase of Intrensic in August 2023.

During 2024, the Company recorded an increase of $21 to goodwill as result of additional liabilities assumed related to the August 2023 Intrensic Acquisition.

In December 2024, the Company assessed the fair value of its Intrensic unit and determined that its carrying value exceeded its fair value by $1,631 and therefore the Company recorded a $1,631 impairment charge related to the goodwill initially recorded from the 2023 acquisition.

The table below summarizes the changes in the carrying amount of goodwill:

SCHEDULE OF GOODWILL

Balance at January 1, 2024	$	1,610
Additional liabilities recorded post-acquisition		21
Impairment charge		(1,631	)
Balance at December 31, 2024	$	-

STOCKHOLDERS’ EQUITY (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands					12 Months Ended
	Nov. 25, 2024	Aug. 19, 2024	Apr. 16, 2024	Jul. 03, 2023	Dec. 31, 2024	Dec. 31, 2023	Oct. 14, 2024
Class of Stock [Line Items]
Common stock, shares authorized					150,000,000	150,000,000
Preferred stock, shares authorized					5,000,000	5,000,000
Preferred stock, par value					$ 0.0001	$ 0.0001
Conversion description				the Conversion Price used to calculate the number of shares issuable will equal to the lower of (i) the then applicable Conversion Price and (ii) 85% of the arithmetic average of the three (3) lowest closing prices of the Company’s Common Stock during the twenty (20) consecutive trading day period ending on the trading day immediately preceding the dividend payment date, provided that such price shall not be lower than the lower of (x) $0.2828 (subject to adjustment for stock splits, stock dividends, stock combinations, recapitalizations or other similar events ) and (y) 20% of the “Minimum Price” (as defined in Nasdaq Stock Market Rule 5635) on the date of the Stockholder Approval (subject to adjustment for stock splits, stock dividends, stock combinations, recapitalizations or other similar events) or, in any case, such lower amount as permitted, from time to time, by the Nasdaq Stock Market.
Common stock conversion price		$ 1.00
Conversion of Series A Preferred Stock to Common Stock [Member]
Class of Stock [Line Items]
Converted shares of preferred stock						102
Converted shares issued						77,000
Common Stock [Member]
Class of Stock [Line Items]
Converted shares of preferred stock					1,468,000
Series A Preferred Stock [Member]
Class of Stock [Line Items]
Preferred stock, shares authorized				10,000	10,000
Preferred stock conversion price				$ 1.45			$ 1.414
Dividend rate, percentage			20.00%	8.00%
Preferred stock conversion price exceeds		$ 8.00
Preferred stock, consecutive trading amount		$ 2,000,000
Net proceeds					$ 2,036
Dividends declared					1,218	$ 392
Dividends preferred stock cash					60	58
Dividends settled with common stock					$ 1,158	232
Converted shares of preferred stock					1,793
Dividends Payable						$ 102
Series A Preferred Stock [Member] \| Post Triggering Event [Member]
Class of Stock [Line Items]
Dividend rate, percentage	20.00%			20.00%

SCHEDULE OF STOCK OPTION OUTSTANDING (Details) - $ / shares	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items]
Options Outstanding, Number Outstanding	3,944,284,000	4,657,635
Options Outstanding, Weighted Average Remaining Contractual Life (Years)	8 years 3 months 18 days	8 years 9 months
Options Exercisable, Number Exercisable	1,467,081,000
Option Exercisable, Weighted Average Exercise Price	$ 2.89
Exercise Price Range One [Member]
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items]
Lower Range of Exercise Prices	1.00
Upper Range of Exercise Prices	$ 2.00
Options Outstanding, Number Outstanding	2,870,309
Options Outstanding, Weighted Average Remaining Contractual Life (Years)	9 years 29 days
Option Outstanding, Weighted Average Exercise Price	$ 1.43
Options Exercisable, Number Exercisable	710,257
Option Exercisable, Weighted Average Exercise Price	$ 1.39
Exercise Price Range Two [Member]
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items]
Lower Range of Exercise Prices	2.01
Upper Range of Exercise Prices	$ 3.00
Options Outstanding, Number Outstanding	459,000
Options Outstanding, Weighted Average Remaining Contractual Life (Years)	8 years 11 months 12 days
Option Outstanding, Weighted Average Exercise Price	$ 2.47
Options Exercisable, Number Exercisable	291,849
Option Exercisable, Weighted Average Exercise Price	$ 2.45
Exercise Price Range Three [Member]
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items]
Lower Range of Exercise Prices	3.01
Upper Range of Exercise Prices	$ 4.00
Options Outstanding, Number Outstanding	150,000
Options Outstanding, Weighted Average Remaining Contractual Life (Years)	9 years 29 days
Option Outstanding, Weighted Average Exercise Price	$ 3.88
Options Exercisable, Number Exercisable
Option Exercisable, Weighted Average Exercise Price
Exercise Price Range Four [Member]
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items]
Lower Range of Exercise Prices	4.01
Upper Range of Exercise Prices	$ 5.00
Options Outstanding, Number Outstanding	91,475
Options Outstanding, Weighted Average Remaining Contractual Life (Years)	6 years 1 month 2 days
Option Outstanding, Weighted Average Exercise Price	$ 4.38
Options Exercisable, Number Exercisable	91,475
Option Exercisable, Weighted Average Exercise Price	$ 4.38
Exercise Price Range Five [Member]
Share-Based Payment Arrangement, Option, Exercise Price Range [Line Items]
Lower Range of Exercise Prices	5.01
Upper Range of Exercise Prices	$ 6.58
Options Outstanding, Number Outstanding	373,500
Options Outstanding, Weighted Average Remaining Contractual Life (Years)	6 years 7 days
Option Outstanding, Weighted Average Exercise Price	$ 5.71
Options Exercisable, Number Exercisable	373,500
Option Exercisable, Weighted Average Exercise Price	$ 5.71

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	12 Months Ended
	Dec. 31, 2024
Accounting Policies [Abstract]
Organization and Business Description	Organization and Business Description Wrap Technologies, Inc., a Delaware corporation (the “Company”“), is a publicly traded company with its common stock, par value $0.0001 per share (“Common Stock”), listed on the Nasdaq Capital Market (“Nasdaq”) under the trading symbol “WRAP”. The Company is a developer and supplier of public safety products and training services for law enforcement and security personnel. The Company’s primary product is the BolaWrap® remote restraint device. The principal markets for the Company’s proprietary products and services are in North and South America, Europe, Middle East and Asia.
Principles of Consolidation	Principles of Consolidation The Company has two wholly owned subsidiaries, Wrap Reality, Inc., an Arizona corporation, formed in December 2020 that sells a virtual reality (“VR”) training system primarily targeting law enforcement agencies and Intrensic, LLC, which the Company acquired in August 2023, which specializes in Body Worn Camera and Digital Evidence Management solutions. The consolidated financial statements include the accounts of these subsidiaries after elimination of intercompany transactions and accounts.
Basis of Presentation and Use of Estimates	Basis of Presentation and Use of Estimates The accompanying financial statements have been prepared on the accrual basis of accounting in conformity with accounting principles generally accepted in the United States of America (“US GAAP”). The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions (e.g., share-based compensation valuation, allowance for doubtful accounts, valuation of inventory and intangible assets, warranty reserve, accrued costs, valuation allowance related to deferred tax assets and recognition and measurement of contingencies) that affect the reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities at the date of the financial statements and affect the reported amounts of revenues and expenses during the reporting period. Actual results could materially differ from those estimates.
Concentrations of Risk	Concentrations of Risk Credit Risk – Financial instruments that potentially subject the Company to concentration of credit risk consisted primarily of cash, cash equivalents, US treasury bills and accounts receivable from customers. The Company maintains its cash and cash equivalent deposits at two domestic financial institutions. The Company is exposed to credit risk in the event of default by a financial institution to the extent that cash and cash equivalents are in excess of the amount insured by the Federal Deposit Insurance Corporation. The Company places its cash and cash equivalents with high-credit quality financial institutions and are managed within established guidelines to mitigate risks. To date, the Company has not experienced any losses on its cash and cash equivalents. Concentrations of Accounts Receivable and Revenue – The Company has a limited number of domestic and international customers. The Company may experience concentrations in both accounts receivable and revenue due to the timing of sales and collections of related payments (see Note 18). Concentration of Suppliers – The Company assembles its BolaWrap products in-house using components and subassemblies from a limited number of suppliers and contract suppliers. In particular, a single supplier is currently the sole manufacturer of the BolaWrap battery assembly, and another single supplier is the sole manufacturer of the propulsion component for BolaWrap cassettes. Other parts are solely sourced from other suppliers. If supplier shortages or logistic delays occur, or quality problems arise, production schedules could be significantly delayed or costs significantly increased, which could in turn have a material adverse effect on the Company’s financial condition, results of operation and cash flows.
Cash and Cash Equivalents	Cash and Cash Equivalents The Company considers all highly liquid investments purchased with original maturities of three months or less from the purchase date to be cash equivalents. Cash equivalents consist primarily of amounts invested in Money Market Funds and US (“US”) Treasury bills and are stated at fair value.
Short-Term Investments	Short-Term Investments The Company’s short-term investments consist of certificates of deposits and US Treasury bills with original maturities beyond three months at the date of purchase and one year or less from the balance sheet date. As of December 31, 2023, all of the Company’s short-term investments were classified as available-for-sale and are carried at estimated fair value with any unrealized gains and losses, unrelated to credit loss factors, included in other comprehensive income in our consolidated statements of stockholders’ equity. As of December 31, 2024, the Company had no short-term investments.
Share-Based Compensation	Share-Based Compensation The Company follows the fair value recognition provisions issued by the FASB in ASC Topic 718, Stock Compensation (“ASC 718”) and has adopted Accounting Standards Update (“ASU”) 2018-07 for share-based transactions with non-employees. Share-based compensation expense recognized during 2024 and 2023 includes stock option and restricted stock unit compensation expense. The grant date fair value of stock options is determined using the Black-Scholes option-pricing model. The grant date is the date at which an employer and employee or non-employee reach a mutual understanding of the key terms and conditions of a share-based payment award and approved by the Company’s Board of Directors. The Black-Scholes option-pricing model requires inputs including the market price of the Company’s Common Stock on the date of grant, the term that the stock options are expected to be outstanding, the implied stock volatilities of several publicly traded peers over the expected term of stock options, risk-free interest rate and expected dividend. Each of these inputs is subjective and generally requires significant judgment to determine. The grant date fair value of restricted stock units is based upon the market price of the Company’s Common Stock on the date of the grant. The Company determines the amount of share-based compensation expense based on awards that the Company ultimately expects to vest and account for forfeitures as they occur. The fair value of share-based compensation is amortized to compensation expense over the vesting term.
Loss per Share	Loss per Share Basic loss per share (EPS) is computed by dividing net loss, less any dividends, accretion or decretion, redemption or induced conversion, if any, on the Company’s Series A Convertible Preferred Stock (“Series A Preferred Stock”), by the weighted average number of shares outstanding during the reported period. In computing diluted EPS, we adjust the numerator used in the basic EPS computation, subject to anti-dilution requirements, to add back the dividends (declared or cumulative undeclared) applicable to the Series A Preferred Stock. Such add-back would also include any adjustments to equity in the period to accrete the Series A Preferred Stock to its redemption price, or recorded upon a redemption or induced conversion, if any. The Company adjusts the denominator used in the basic EPS computation, subject to anti-dilution requirements, to include the dilution from potential shares resulting from the issuance of the Series A Preferred Stock, restricted stock units, and stock options. Stock options and restricted stock units exercisable or issuable for a total of 4,932,386and 5,468,223 shares of Common Stock were outstanding at December 31, 2024 and 2023, respectively. These securities are not included in the computation of diluted net loss per common share for the periods presented as their inclusion would be antidilutive due to losses incurred by the Company.
Accounts Receivable and Allowance for Credit Losses	Accounts Receivable and Allowance for Credit Losses ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326) requires that financial assets measured at amortized cost be presented at the net amount expected to be collected. The expected credit losses are developed using an estimated loss rate method that considers historical collection experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. The estimated loss rates are applied to accounts receivables with similar risk characteristics such as the length of time the balance has been outstanding and the location of the customer. In certain instances, the Company may identify individual accounts receivable assets that do not share risk characteristics with other accounts receivables, in which case the Company records its expected credit losses on an individual asset basis. If an accounts receivable asset is evaluated on an individual basis, the Company excludes those assets from the portfolios of accounts receivables evaluated on a collective basis. At December 31, 2024 and 2023, the Company had an allowance for credit losses related to accounts receivable of $230 and $386, respectively. If a major customer’s creditworthiness deteriorates, or actual defaults exceed our historical experience, such estimates could change and impact our future reported financial results.
Inventories	Inventories Inventories are valued at the lower of cost or net realizable value. The cost of substantially all the Company’s inventory is determined by the FIFO cost method. Inventory is comprised of raw materials, assemblies and finished products intended for sale to customers. The Company evaluates the need for reserves for excess and obsolete inventories determined primarily based upon estimates of future demand for the Company’s products. As of December 31, 2024 and 2023, the Company had $480 and $465, respectively, in reserves for obsolescence.
Property, Equipment and Depreciation	Property, Equipment and Depreciation Property and equipment are stated at cost. Depreciation on property and equipment is computed over the estimated useful lives of three years using the straight-line method. On any retirement or disposition of property and equipment, the related cost and accumulated depreciation or amortization is removed, and a gain or loss recorded.
Business Combinations	Business Combinations The Company accounts for its business combinations under the provisions of Accounting Standards Codification (“ASC”) Topic 805-10, Business Combinations (“ASC 805-10”), which requires that the purchase method of accounting be used for all business combinations. Assets acquired and liabilities assumed, including non-controlling interests, are recorded at the date of acquisition at their respective fair values. The estimated fair value of net assets acquired, including the allocation of the fair value to identifiable assets and liabilities, was determined using established valuation techniques. ASC 805-10 also specifies criteria that intangible assets acquired in a business combination must meet to be recognized and reported apart from goodwill. Goodwill represents the excess purchase price over the fair value of the tangible net assets and intangible assets acquired in a business combination. Acquisition-related expenses are recognized separately from the business combinations and are expensed as incurred. The estimated fair value of the acquired intangible assets was determined using a method which reflects the present value of the operating cash flows generated by this asset after taking into account the cost to realize the revenue, and an appropriate discount rate to reflect the time value and risk associated with the invested capital. Certain adjustments to the assessed fair values of the assets and liabilities made subsequent to the acquisition date, but within the measurement period, which is up to one year, are recorded as adjustments to goodwill. Any adjustments subsequent to the measurement period are recorded in income.
Goodwill	Goodwill Goodwill represents the difference, if any, between the aggregate consideration paid for an acquisition and the fair values of the underlying net assets and liabilities assumed from an acquired business. Goodwill is not amortized, but instead is tested for impairment. The Company tests goodwill for impairment on an annual basis during the fourth quarter, or more frequently if conditions indicate that such impairment could exist. The Company evaluates qualitative factors to determine if it is more likely than not that the fair value of a reporting unit is less than its carrying value and whether it is necessary to perform goodwill impairment process.
Definite-lived Intangible Assets	Definite-lived Intangible Assets Definite-lived intangible assets represent certain trade names, patents, licenses, software, acquired technology and customer relationships. Definite-lived intangible assets are recorded at cost less any accumulated amortization and accumulated impairment losses, if any. Definite-lived intangible assets acquired through the business combination are measured at fair value at the acquisition date. The Company amortizes these acquired definite-lived intangibles assets with a finite life on a straight-line basis, over 6 years for technology; 7 years for customer relationships; and 8 years for trademarks and trade names.
Intangible Assets	Intangible Assets Intangible assets consist of (a) capitalized legal fees and filing costs related to obtaining patents and trademarks, (b) tradenames and software, (c) purchased software, and (d) the purchase cost of indefinite-lived website domains. The estimated useful lives of identifiable intangible assets with definite useful lives have been estimated to be between one and twenty years. Purchased website domain costs with an indefinite useful life are not subject to amortization, but are subject to an annual impairment test, by comparing their carrying amount with their corresponding fair value. For any given intangible asset with an indefinite useful life, if its fair value exceeds its carrying amount no impairment loss shall be recognized. The carrying value of intangibles is periodically reviewed and impairments, if any, are recognized when the future undiscounted cash flows realized from the assets is less than its carrying value.
Impairment of Long-Lived Assets	Impairment of Long-Lived Assets Long-lived assets and identifiable intangibles held for use are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If the sum of undiscounted expected future cash flows is less than the carrying amount of the asset or if changes in facts and circumstances indicate, an impairment loss is recognized and measured using the asset’s fair value. In December 2024, the Company determined that the assessment of the Intrensic unit’s fair value indicated that its carrying value exceeded its fair value by $1,631 and therefore the Company recorded a $1,631 impairment charge related to the goodwill initially recorded from the acquisition. In December 2023, it was determined that the intangible related to development of proprietary software by Lumeto, Inc. would not have future economic value and was written down; the Company recognized an impairment loss of $700.
Warrants	Warrants The Company accounts for warrants as liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 480, Distinguishing Liabilities from Equity (“ASC 480”) and ASC 815, Derivatives and Hedging (“ASC 815”). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own common stock and whether the warrant holders could potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding. For issued warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded at their initial fair value on the date of issuance, and each balance sheet date thereafter. The Company accounts for the warrants issued in accordance with the guidance contained in ASC 815-40-15-7C, under which the warrants do not meet the criteria for equity treatment and must be recorded as liabilities. Accordingly, the Company classifies the warrants as liabilities at their fair value and adjusts the warrants to fair value at each reporting period. This liability is subject to re-measurement at each balance sheet date until exercised, and any change in fair value is recognized in the Company’s condensed consolidated statement of operations.
Convertible Preferred Stocks	Convertible Preferred Stocks The Company evaluates and accounts for conversion options embedded in its convertible instruments in accordance with ASC 480 and ASC 815 to determine if those instruments or embedded components of those instruments qualify as derivatives and are subject to bifurcation accounting. The Company determines that the economic characteristics and risks of the embedded derivative instrument are clearly and closely related to the economic characteristics and risks of the host contract. The convertible instruments are accounted for as a single hybrid instrument. Additionally, the convertible instruments do not have any redemption features that would preclude permanent equity classification in accordance with the guidance contained in ASC 480-10-S99.
Advertising and Promotion Costs	Advertising and Promotion Costs Advertising costs are charged to expense as incurred and were $575 and $925 for the years ended December 31, 2024 and 2023, respectively. The Company also incurred product promotion costs for demonstration products delivered to prospective customers of $129 and $225 for the years ended December 31, 2024, and 2023, respectively. Advertising and promotion costs are included in selling, general and administrative expenses in the accompanying statements of operations.
Demonstration and Training Costs	Demonstration and Training Costs The Company maintains a demonstration and training department as a part of its sales and marketing activities and does not charge for product demonstrations or training. Training is not a condition or requirement of sale as most sales are made through distributors to their end customers. The Company conducts local and regional in-person, webinar and on-line demonstrations and use of force and escalation training to support law enforcement agencies with no purchase requirement. Such training, when provided, may occur before or after initial or subsequent purchase or field deployment of the Company’s products. The Company believes that law enforcement trainers and officers that have seen demonstrations or have been trained about its products are more supportive of their departments purchase and deployment of product.
Research and Development Costs	Research and Development Costs Research and development costs are expensed as incurred.
Contract Manufacturers	Contract Manufacturers The Company employs contract manufacturers for production of certain components and sub-assemblies. The Company may provide parts and components to such parties from time to time but recognizes no revenue or markup on such transactions.
Leases	Leases The Company adopted ASC Topic 842, Leases (“Topic 842”) on January 1, 2019. In accordance with the guidance in Topic 842, the Company recognizes lease liabilities and corresponding right-of-use-assets for all leases with terms of greater than 12 months. Leases with a term of 12 months or less will be accounted for in a manner similar to the guidance for operating leases prior to the adoption of Topic 842. Refer to Note 9, Leases for more information.
Revenue Recognition	Revenue Recognition The Company adopted ASC Topic 606, Revenue from Contracts with Customers on January 1, 2018. The Company enters into contracts that include various combinations of products, accessories, software and services, each of which are generally distinct and are accounted for as separate performance obligations. Product sales include BolaWrap products and accessories. Other revenue includes VR revenues, service, training and shipping revenues. The timing of revenue recognition may differ from the timing of invoicing to customers. The Company generally has an unconditional right to consideration when customers are invoiced, and a receivable is recorded. A contract asset is recognized when revenue is recognized prior to invoicing, or a contract liability (deferred revenue) when revenue will be recognized subsequent to invoicing. The Company recognizes an asset if there are incremental costs of obtaining a contract with a customer such as commissions. These costs are ascribed to or allocated to the underlying performance obligations in the contract. The Company may receive consideration, per terms of a contract, from customers prior to transferring goods to the customer. The Company records customer deposits as a contract liability. Additionally, the Company may receive payments, most typically for service and warranty contracts, at the onset of the contract and before the services have been performed. In such instances, a deferred revenue liability is recorded. The Company recognizes these contract liabilities as revenue after all revenue recognition criteria are met. Estimated costs for the Company’s standard warranty, generally one-year, are charged to cost of products sold when revenue is recorded for the related product. Royalties are also charged to cost of products sold.
Shipping and Handling Costs	Shipping and Handling Costs Shipping and handling costs are included in cost of revenues. Shipping and handling costs invoiced to customers are included in revenue. Actual shipping and handling costs were $125 and $200 for the years ended December 31, 2024 and 2023, respectively. Actual revenues from shipping and handling were $73 and $37 for the years ended December 31, 2024 and 2023, respectively.
Warranty Reserves	Warranty Reserves The Company warrants its products and accessories to be free from defects in materials and workmanship for a period of one year from the date of purchase. The warranty is generally limited. The Company currently provides direct warranty service. International market warranties are generally similar to the US market. The Company establishes a warranty reserve based on anticipated warranty claims at the time product revenues are recognized. Factors affecting warranty reserve levels include the number of units sold, anticipated cost of warranty repairs and anticipated rates of warranty claims. The Company evaluates the adequacy of the provision for warranty costs each reporting period. The warranty reserve was $83 and $72 at December 31, 2024 and 2023. Actual warranty costs could differ from estimates.
Segment Information	Segment Information ASC Topic 280, “Segment Reporting,” requires use of the “management approach” model for segment reporting. The management approach model is based on the way a company’s management organizes segments within the company for making operating decisions and assessing performance. The Company operates as a single segment and will evaluate additional segment disclosure requirements as it expands its operations.
Income Taxes	Income Taxes No income tax expense was recorded for the periods ended December 31, 2024 and 2023, due to losses incurred. Deferred tax assets and liabilities are determined based on temporary differences between the bases of certain assets and liabilities for income tax and financial reporting purposes. The Company maintains a valuation allowance with respect to deferred tax assets. The Company establishes a valuation allowance based upon the potential likelihood of realizing the deferred tax asset and taking into consideration the Company’s financial position and results of operations for the current period. Future realization of the deferred tax benefit depends on the existence of sufficient taxable income within the carry-forward period under the Federal tax laws. Changes in circumstances, such as the Company generating taxable income, could cause a change in judgment about the realizability of the related deferred tax asset. Any change in the valuation allowance will be included in income in the year of the change in estimates.
Recently Issued Accounting Guidance	Recently Issued Accounting Guidance On December 14, 2023, the FASB issued a final standard on improvements to income tax disclosures. The standard requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid. The standard is intended to benefit investors by providing more detailed income tax disclosures that would be useful in making capital allocation decisions. ASU 2023-09, Improvements to Income Tax Disclosures, applies to all entities subject to income taxes. For public business entities (PBEs), the new requirements will be effective for annual periods beginning after December 15, 2024. The guidance will be applied on a prospective basis with the option to apply the standard retrospectively. The Company does not plan to early adopt this standard. On March 21, 2024, the FASB issued ASU 2024-01 to clarify the scope application of profits interest and similar awards by adding illustrative guidance in ASC 718, Compensation - Stock Compensation. For PBEs, the amendments in this Update are effective for annual periods beginning after December 15, 2024, and interim periods within those annual periods. The Company does not plan to early adopt this standard. The Company has reviewed recently issued, but not yet effective, accounting pronouncements and does not believe the future adoptions of any such pronouncements will be expected to cause a material impact on its financial condition or the results of operations.