S-1/A 1 forms-1a.htm

As filed with the Securities and Exchange Commission on July 28, 2021.

Registration No. 333-257656

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Amendment No. 2 to

FORM S-1

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

MINIM, INC.
(Exact name of registrant as specified in its charter)

Delaware

3661

04-2621506

(State or other jurisdiction

of incorporation or organization)

(Primary Standard Industrial

Classification Code Number)

(I.R.S. Employer

Identification Number)

848 Elm Street

Manchester, New Hampshire, 03101

(833) 966-4646

(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)

Sean Doherty

Chief Financial Officer

Minim, Inc.

848 Elm Street

Manchester, New Hampshire, 03101

(833) 966-4646

(Name, address, including zip code, and telephone number, including area code, of agent for service)

Copies to:

Richard F. Langan, Jr., Esq.

Nixon Peabody LLP

55 West 46th Street

New York, NY 10036-4120

(212) 940-3000

Sara L. Terheggen, Esq.

The NBD Group, Inc.

350 N. Glendale Avenue, Ste B522

Glendale, California 91206

(310) 890-0110

As soon as practicable after the effective date of this registration statement.

(Approximate date of commencement of proposed sale to the public)

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box: [ ]

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ]

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ]

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer [ ]		Accelerated filer [ ]
Non-accelerated filer [X]		Smaller reporting company [X]
		Emerging growth company [ ]

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. [ ]

CALCULATION OF REGISTRATION FEE

Title of Each Class of Securities to be Registered

Proposed Maximum Aggregate Offering Price(1)(2)

Amount of Registration Fee(3)(4)

Common Stock, par value $0.01 per share

28,750,000

3,137

(1)	Includes shares of Common Stock issuable upon the exercise of the underwriters’ option to purchase additional shares. See “Underwriting.”
(2)	Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(a) of the Securities Act of 1933, as amended.
(3)	Calculated pursuant to Rule 457(o) based on an estimate of the proposed maximum aggregate offering price.
(4)	The Registrant previously paid $3,137 of the total registration fee in connection with a prior filing of this Registration Statement.

The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities nor does it seek an offer to buy these securities in any state or other jurisdiction in which the offer or sale is not permitted.

PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION, DATED JULY 28, 2021

Minim, Inc.

8,417,508 Shares of Common Stock

We are offering 8,417,508 shares of our common stock, par value $0.01 per share (the “Common Stock”).

Our Common Stock is listed on The Nasdaq Capital Market under the symbol “MINM”. We have assumed the shares of Common Stock are offered at $2.97 per share, which was the closing price of our Common Stock as reported on The Nasdaq Capital Market on July 27, 2021. The final public offering price will be determined through negotiation between us and the underwriters in the offering and will take into account the recent market price of our common stock, the general condition of the securities market at the time of the offering, the history of, and the prospects for, the industry in which we compete, and our past and present operations and our prospects for future revenues. The assumed public offering price used throughout this prospectus may not be indicative of the actual offering price.

Certain of our officers, directors and employees, including Gray Chynoweth, our Chief Executive Officer, and certain of their respective affiliates, have indicated an interest in participating in this offering at the public offering price. We anticipate that such persons will purchase in the aggregate approximately 203,704 shares of Common Stock offered hereby. However, because indications of interest are not binding agreements or commitments to purchase, the underwriters could determine to sell fewer shares to them than they indicated an interest in purchasing or sell no shares to them, and they could determine to purchase fewer shares than they indicated an interest in purchasing or purchase no shares in this offering.

We are a “smaller reporting company,” as defined in the Securities Exchange Act of 1934, as amended, and may avail ourselves of reduced disclosure requirements applicable to smaller reporting companies, which could make our Common Stock less attractive to investors and adversely affect the market price of our Common Stock. This prospectus complies with the requirements that apply to an issuer that is a smaller reporting company.

Investing in our Common Stock involves risk. See “Risk Factors” beginning on page 17.

	Per Share	Total
Public offering price	$	$
Underwriting discounts and commissions(1)	$	$
Proceeds, before expenses, to us	$	$

(1)	We refer you to the section titled “Underwriting” beginning on page 59 for additional information regarding underwriting compensation.

We have granted to the underwriters an option to purchase up to 1,262,626 additional shares of Common Stock, exercisable at any time until 30 days after the date of this prospectus.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

The underwriters expect to deliver the shares of Common Stock against payment on , 2021.

B. Riley Securities

The date of this prospectus is , 2021.

Table of Contents

		Page

PROSPECTUS SUMMARY		1
SELECTED CONSOLIDATED FINANCIAL DATA		11
UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION		14
RISK FACTORS		17
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS		28
USE OF PROCEEDS		29
DIVIDEND POLICY		30
CAPITALIZATION		31
BUSINESS		32
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS		42
MANAGEMENT		49
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT		53
CERTAIN U.S. FEDERAL INCOME TAX CONSIDERATIONS		55
UNDERWRITING		59
LEGAL MATTERS		66
EXPERTS		66
INCORPORATION OF INFORMATION BY REFERENCE		66
WHERE YOU CAN FIND MORE INFORMATION		67

You should rely only on the information contained in this prospectus or any information incorporated by reference herein or in any free writing prospectuses or amendments thereto that we may provide to you in connection with this offering. Neither we nor any of the underwriters have authorized anyone to provide you with information different from, or in addition to, that contained in this prospectus or incorporated by reference herein or in any such free writing prospectus. If anyone provides you with different or inconsistent information, you should not rely on it. We can provide no assurance as to the reliability of any other information that others may give to you. The information in this prospectus or incorporated by reference in this prospectus is accurate only as of the date on the front cover of this prospectus, and the information in any free writing prospectus that we may provide you in connection with this offering is accurate only as of the date of such free writing prospectus. Our business, financial condition, results of operations and prospects may have changed since those dates. Neither we nor any of the underwriters are making an offer to sell or seeking offers to buy these securities in any jurisdiction where or to any person to whom the offer or sale is not permitted.

PROSPECTUS SUMMARY

The following summary provides an overview of certain information about Minim, Inc., formerly known as Zoom Telephonics, Inc., which we refer to, together with its consolidated subsidiaries, in this prospectus as the “Company” or “Minim,” which is the name under which we do business, and this offering and may not contain all the information that is important to you. This summary is qualified in its entirety by, and should be read together with, the information contained in other parts of this prospectus or incorporated by reference into this prospectus. You should carefully review this entire prospectus, including “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and our consolidated financial statements and the related notes incorporated by reference into this prospectus. Some of the statements in this prospectus constitute forward-looking statements. See “Cautionary Note Regarding Forward-Looking Statements.”

Business Overview

Our Company

Minim is on a mission to make everyone’s connected home safe and easy to use for life and work.

We have developed intelligent networking products and a WiFi as a Service platform that powers applications for businesses, service providers, and home users. Our products deliver experiences so simple, they’re automated. So secure, they’re trusted. So helpful, they’re loved.

Internet is more than a utility to homes around the world. It’s a gateway to culture, society, work, education, entertainment, connection, medicine, information, and more. Reliable and secure access is no longer a nice to have, but a necessity that links us to the people we love and the things we need. Never was this more apparent than during the COVID-19 pandemic.

Since residential WiFi entered the scene in the late 1990s, the wireless protocol (802.11) has evolved over ten generations. Key advancements such as more radio capabilities and wider use of the airwave spectrum led to better area coverage and faster speeds. In 1997, you would be lucky to get 2 megabits per second of data throughput. Today, the 802.11ax (“WiFi 6”) standard offers a theoretical 9.6 gigabits per second.

These advancements have enabled the smart home we know today. And we’re at an inflection point for the smart home of tomorrow: The US government and a handful of countries have opened the 6 GHz spectrum for WiFi use, which has the potential with WiFi 6E to unlock incredible Ultra-Wide Broadband (“UWB”) applications. We expect increasing demand in network equipment upgrades over the next five years.

Yet, for all its advancements, the home router is currently the number one target in a residential cyberattack. The standard router interface hasn’t changed much since the late 1990s. And “I’m having WiFi problems” is all too familiar a phrase in the home. It makes sense: today’s routers are simple, single-purpose devices that rarely receive firmware updates and have underdeveloped management applications.

We believe the router must instead go the way of the mobile phone, offering frequent security updates, helpful apps, extensive personalization options, and a delightful interface. That is what Minim delivers— not just the router or just an app, but an intelligent router managed with an integrated smart operating system that leverages cloud computing and AI to analyze and optimize the smart home, combined with intuitive applications to engage with it.

As a result of the Company’s strategic acquisition by merger of the software company Zoom Connectivity, Inc., formerly known as Minim Inc. (“Zoom Connectivity”), which closed on December 4, 2020, we have become a software-driven smart home product company with a global license to the Motorola brand for home networking and security. Along with the vertical integration of great hardware and innovative software, the merger brought together multi-pronged go-to-market strategies and hardware and software talent under one umbrella.

Our products can now be found in leading retailers across the US and in over 100 Internet Service Providers (“ISPs”) broadband offerings. In the first quarter of 2021, our Motorola modem and modem/router devices led the category in US Amazon sales. Our software is integrated with third-party hardware and two of our Motorola products to date. For the past three quarters, the Company has posted record revenue growth and margin expansion.

Looking ahead, we see margin expansion and growth opportunities in subscription software, new geographical markets, new channels, and new product categories, such as connected security cameras and thermostats.

The global smart home market is expected to reach $313.95 billion by 2026 at a 25.3% compound annual growth rate (“CAGR”), according to Mordor Intelligence. Looking ahead, we are aligned on a powerful imperative: to make the world’s smartest connectivity products accessible to everyone for personal and business use.

Our Solution

Minim delivers intelligent networking products with our comprehensive WiFi as a Service platform that are comprised of the following product components:

	●	*The Minim® Mobile App* gives consumers total control over their connected home with intuitive settings to monitor secure, and optimize their home network from anywhere. This app addresses many home user needs, from helping parents monitor online activities, to ensuring remote worker productivity, to empowering gamers and streamers to reach faster performance, and much more.

	●	*The Minim® Care Portal* offers a single pane of glass view, with privacy settings, to ISPs and other businesses to efficiently and remotely support and secure home broadband users.

	●	*The Minim® Cloud* is an AI-driven platform that powers our interfaces with the home router. The platform has been architected to operate across multiple private and public clouds. This design allows us to effectively manage costs associated with hosting our cloud application; to segregate subscriber data to achieve compliance with local regulations; and to offer managed ‘on premise’ deployments for large ISP customers.

	●	*The Minim® Middleware Agent*, “Unum”, has been open sourced to enable third-party hardware makers to integrate with Minim’s cloud platform. Now integrated with leading open-source router operating systems, “Unum” was designed with a minimal footprint— requiring an estimated 1/10^th of resources versus a leading competitor— and has been integrated with top router brands, primarily for our ISP customer base to date. Unum also been deployed in the cloud to achieve agentless integrations with hardware that exposes sufficient functionality via API.

	●	*The Minim® API suite* enables third parties to build our cloud-managed WiFi functionality and reporting into their own interfaces and systems.

	●	*Motorola®, Zoom®, and third-party hardware.* Minim creates innovative connectivity hardware under the Motorola brand and our long-held ZOOM trademark, offering a growing portfolio of products to meet the unique needs of every home. Our exclusive global Motorola brand licenses have expanded in geographic and product category scope through the years. We actively collaborate with the Motorola Strategic Brand Partnerships team to guide quality and innovative product design, manufacturing, and marketing practices. Our current hardware product portfolio includes:

	○	Modems and Modem/Routers (“Gateways”) allow our customers to convert cable service into Internet connectivity for Ethernet-only connection (modems) or Ethernet and wireless connections (modem/routers). Gateways manufactured by Minim meet various technical specifications for capability and performance (e.g., DOCSIS 3.0, DOCSIS 3.1, WiFi 5, WiFi 6). Where appropriate, Gateways are certified by Cable Labs® and cable service providers, allowing the devices to be used on and marketed for ISP networks (e.g., Comcast Xfinity, Charter Spectrum, Cox).

	○	WiFi & mesh systems enable our customers to create wireless networks to connect all their smart home devices. WiFi devices and mesh systems built by Minim satisfy technical specifications for capability and performance (e.g., WiFi 5, WiFi 6).

	○	Multimedia-over-coax-alliance (“MoCA”) devices allow our customers to create faster, reliable connections using their home’s coax cable wiring. In addition to increasing wired device speeds, customers can use Minim’s MoCA network adapters to enhance WiFi bandwidth and capacity.

	○	Third Party Hardware - We sell WiFi systems that are manufactured by third parties (e.g., MkroTik®). We do this when our customers want to purchase our software but for feature, functionality, price or availability reasons would prefer to purchase hardware we do not manufacture.

Our Customers

Key Customer Benefits

Minim serves both consumers and businesses with its WiFi as a Service platform:

●

Consumers – Home broadband users can find our networking products and mobile app under the Motorola brand on leading electronics retailers and e-commerce platforms in the US and under the ZOOM® trademark, and from our own e-commerce platform which is coming soon. With Motorola connectivity, our customers benefit from:

	○	Savings on rental fees from their ISPs;
	○	Improved connected device performance;
	○	Fast internet speeds;
	○	Free support from our team of U.S.-based technicians; and
	○	Reliability with 2-year product warranties.

	●	*ISPs* – Over 100 ISP customers to date have selected Minim to enhance their broadband services with our mobile app and improve customer support via the Minim Care Portal. ISP customers benefit from increased revenue through service plan upgrades and better subscriber retention, as well as decreased operational expenses through truck roll avoidance and reduced support calls.

	●	*Hybrid & Small Businesses* – Minim is an alternative to traditional enterprise security solutions, granting the business customer extensive cost savings, fast deployment times, and easy maintenance.

	●	*Original Equipment Manufacturers (“OEMs”)* – OEMs can freely and independently integrate the Minim agent in their networking devices. OEM customers benefit from increased competitiveness of their product offering and a recurring revenue stream with our software services. Our system integrator and OEM customers sell our products under their brand or incorporate our products as a component of their systems.

Our Business Model

The foundation of our business model is to deliver a better-connected home experience to home users and the organizations that support them.

Today, we primarily derive revenue from the sale of our intelligent networking products to home users. These products leverage the benefits of the scale we have achieved with our long-standing hardware business and the continuous interaction’s cycles and higher gross margins come with our WiFi as a Service platform.

Key to our success in this business line is the ability to leverage the global power of the Motorola®, the marketing, manufacturing, quality assurance and security support we receive from Motorola as a brand licensee and the natural relationships we benefit from as one of Motorola’s growing, global stable of brand licensees.

Over time, we believe that material revenue sources will also come to include the sale of the WiFi as a Service platform as an independent product and the sale of additional smart home products that leverage our intelligent networking products and WiFi as a Service platform to deliver a more usable and secure home.

Our Industry

The market for advanced connectivity products is massive, expanding, and dynamic. There are several trends and factors that are driving market growth:

	●	Over one billion homes are now connected to the Internet. The next billion homes are connecting by the tens of millions every year.
	●	Smart homes continue to amass connected devices, making network management and security more complex and more valuable.
	●	Covid-19 accelerated the home network’s essentiality as a gateway to online education, work, entertainment, telemedicine, and social connection.
	●	High-profile network security events have heightened the public’s cybersecurity awareness and attention; residential network vulnerabilities are now seen as risk to personal information, business operations, and public infrastructure.
	●	Emerging government bodies are designing regulations to preserve their constituents’ security and privacy across their Internet-connected devices and applications.
	●	Consumers have expanding access and choice in broadband services as a result of emerging technologies (e.g., 5G) that enable new market entrants: Wireless Internet Service Providers, Satellite Internet Service Providers, and Peer-to-Peer networks.
	●	Consumers are shortening their network upgrade cycles as higher performance products and service plans come available, driven by new spectrum accessibility opportunities (e.g., 6 Ghz) and advancing Internet technology standards (e.g., WiFi 6, WiFi 6E, 5G, DOCSIS 3.1, DOCSIS 4.0).
	●	Proliferation of AI technology is leading to software that can more effectively optimize network performance, device management, security assurance, and self-help tools.

Our Opportunity

It’s an exciting time to be a part of the smart home ecosystem, particularly in WiFi. In 2020, the FCC opened the 6 GHz band to WiFi and other unlicensed users. This extensive 1,200 MHz of spectrum allocation unlocks a bright wireless future: faster data transfer, wider channels, and stronger signal.

Realizing the promise of wireless technology innovation UWB offers, the US is now in the company of open 6 GHz spectrum markets, including Argentina, Brazil, Canada, Mexico, Peru, the United Kingdom (partial), Saudi Arabia, and South Korea— and growing.

According to ABI Research, UWB is expected to become the de facto radio technology by 2025, with more than 1.6 billion WiFi chipsets delivered. At the same time, the global smart home market is expected to reach $313.95 billion by 2026 at a 25.3% CAGR, according to Mordor Intelligence.

While hardware development is plowing ahead, we believe residential networking software has not advanced with modern edge and cloud computing technologies, creating a great opportunity.

Our Unique Approach

We believe we have 5 key differentiating aspects to our business strategy to sustain long-term growth:

	1.	*Experience-led.* Minim is not hardware focused as are most competitors, where the Software as a Service business model and associated investments face great friction. Rather, we believe that exceptional customer value can only be delivered by combining the power of user centric software experiences with a robust choice of hardware options.

	2.	*Ecosystem approach.* Like Android to phones, our software is easy to integrate and can bring all kinds of hardware to life. Our router middleware has an estimated 10 times less the footprint and hardware performance requirements as a leading competitor’s. This enables us to enter emerging markets where product price points are lower, effectively expanding our Total Addressable Market and allowing us to deliver on our accessibility vision.

	3.	*Customer-focused.* We maintain direct relationships with consumers, retailers, ISPs, and businesses for product feedback that informs our hardware and software roadmap.

	4.	*Open to partner*. Minim’s core business model delivers value to ISPs and retailers, unlike competitors who challenge them; this enables us to form more durable partnerships and strategic alliances.

	5.	*Sustainable.* Minim’s core business model does not tie services— such as broadband services, browser services, search services, and advertising services— to our products. Such binding can create privacy and antitrust concerns amongst incumbent and new market entrants.

Our Growth Strategy

We are pursuing our market opportunity with a multi-pronged growth strategy:

Growth Through Product Innovation

	●	*Increase software user acquisition through intelligent hardware distribution.* In retail, we can secure a higher Average Sales Price for intelligent networking products that include a 3-year subscription license to our mobile app and automated security. These superior-value offerings bundle high-margin, deferred subscription revenue with a lower-margin hardware sale. In business sales channels, we can sell our cloud software independently of hardware, allowing the customer to integrate Minim with their preferred platform.

	●	*Broaden hardware product portfolio.* Increased Motorola and Zoom® intelligent networking hardware sales in existing and new product categories represent an opportunity for revenue growth and wider software distribution. We retain the global, exclusive licenses to the Motorola brand for connected home networking, energy management, and security. To date, we have only made use of the home networking license and see great opportunities in connected security cameras and thermostats. In this category, we see opportunities to widen our product portfolio and increase sales to meet the demand for cutting-edge performance products as well as value-driven products for emerging global markets.

	●	*Increase our Average Revenue per User (“ARPU”).* Minim’s intelligent networking hardware products represent an opportunity for ARPU growth through upsells and cross-sells. When an end user downloads our mobile app, we can maintain a direct, persistent relationship to establish brand loyalty for in-app feature upgrades and future product purchases. When a business or ISP uses Minim’s Care Portal, we can offer feature suite and service plan upgrades. Our software innovation is guided by our intent to increase customer engagement and retention, signs of sustainable value delivery.

Growth Through Market Expansion

●

Expand Internationally. Expansion beyond the US market represents a large opportunity for revenue growth as North America constitutes less than 10 percent of the world’s Internet users. Here, we have several positive indicators, including: a high degree of Motorola brand recognition worldwide; public and private initiatives to increase broadband access to homes; earlier smart home adoption curve outside the US; and early WiFi as a Service adoption by ISPs in global markets. Having already served ISPs in Africa, Canada, and the UK, we see near-term opportunities in India, Europe, Latin America, Canada, and Africa.

Growth Through Sales and Marketing

	●	*Increase sales in direct-to-consumer channels.* Acquiring and nurturing retailer relationships for further product placement opportunities represent a key opportunity for growth. Retailers choose to work with Minim for our pricing integrity, extended product warranties, quality customer support, positive product reviews, powerful Motorola brand, distribution and sales partnerships, and effective marketing practices.

	●	*Increase sales conversions with a growing omnichannel marketing engine.* We see expanding investments in marketing and brand awareness as a significant growth driver. This year, we have strategically invested in the marketing team talent responsible for achieving the #1 position in Amazon.com for modem products in Q1 2021, lending to our highest revenue-quarter yet. Within our Amazon strategy, we sell directly to consumers using the Seller Central model, affording us higher pricing control and margins than our competitors using Buyer Central. We believe there is great opportunity to expand our own e-commerce strategy on minim.com and MotoManage.com; on e-tail platforms; and on Amazon worldwide alongside strategic merchandising in stores.

	●	*Increase sales in business-to-business channels.* Globally, we sell to challenger and incumbent ISPs and businesses directly and via channel partners. We target increased sales directly through inbound marketing and sales development within several ecosystems, including: the Wireless ISP Association (“WISPA”), the Fiber Broadband Association (“FBA”), and the Microsoft Airband Initiative. We target increased sales indirectly through our relationships with channel partners Irdeto, the global leader in digital platform security for ISPs, and Telarus, the largest privately held technology products master agent in the US.

Our Culture and Values

Team diversity makes us stronger, bringing together varied perspectives to solve problems and empathize with our customers. But we cannot build this vibrancy without vigilant inclusivity. With this principle, we have formed the following cultural values:

	1.	*RESPECT*. Respect is the bedrock on which diverse perspectives and great suggestions come together.
	2.	*Circle of Transparency.* With important information, we can make better decisions, together.
	3.	*Connected Community.* A community where everyone feels respected, equal, safe, valued, connected.
	4.	*Empowered Accountability.* We fearlessly take initiatives in pursuit of our goals and beyond.
	5.	*Big Open Minds.* We exercise mental agility and encouragement like muscles so big ideas can take off.
	6.	*Mindful Collaboration.* Team distribution is our superpower, and we regard work-life harmony.
	7.	*Go for it!* We’ll take experimentation over slideware any day of the week.

We see our culture as a continuous effort, a living document. We have strides to make in team diversity, employee education, and global recruitment strategies. We have actions to take in supporting remote-work first approach, investing in bringing teams together at critical creative moments. We are actively working on these initiatives, and our work is never done to ensure Minim is a place of work where passionate and diverse talent feel at home.

Our Market and Operational Concentrations

Customer Concentration

At March 31, 2021, three companies with an accounts receivable balance of 10% or greater individually accounted for a combined 87% of the Company’s accounts receivable. At December 31, 2020, three companies with an accounts receivable balance of 10% or greater individually accounted for a combined 85% of the Company’s accounts receivable. At December 31, 2019, three companies with an accounts receivable balance of 10% or greater individually accounted for a combined 84% of the Company’s accounts receivable.

Market Concentration

Today, the US market accounts for the vast majority of the Company’s revenues. In the first quarter of 2021, sales outside North America were only 1.3% of our net sales. For the fiscal year ending December 31, 2020, sales outside North America were only 1.8% of our net sales. For the fiscal year ending December 31, 2019, sales outside North America were only 2.3% of our net sales.

Product, Manufacturer and Chipset Concentration

The majority of our sales were for Gateways containing Broadcom chipsets that were manufactured by T&W in Vietnam. The Company continues to look for ways to diversify its product offerings, the chipsets that our products are made with and the manufacturers that produce them on our behalf.

Regulatory Environment Concentration

The majority of our sales were for products that were compliant with regulations and requirements relevant only to the US market. The regulatory and certification requirements and purchasing behaviors for Gateways differs materially between different global markets. The Company continues to work toward bringing its products into compliance with the regulations and requirements necessary to sell them in different global markets (e.g, India, European Union, Mexico).

Intellectual Property Rights

We hold an exclusive license to use the Motorola® brand trademarks in a wide range of consumer products including cable modems, gateways, routers, WiFi range extenders, home powerline network adapters, access points, MoCA adapters, and cellular sensors. The exclusive license allows the Company to sell through authorized channels worldwide, including Direct to Consumer Channels and Service Provider Channels, through December 31, 2025.

Our middleware agent is maintained under an Apache-2.0 open-source license.

Recent Developments

Our consolidated financial statements for the three months ended June 30, 2021 are not yet available. We expect our consolidated revenue for the three months ended June 30, 2021 to be approximately $14.75 million, compared to $10.3 million for the three months ended June 30, 2020, reflecting an approximately 43% increase in consolidated revenue from the three months ended June 30, 2020. Gross margins for the second quarter of 2021 are also expected to have increased by approximately 45% compared to 21% for the three months ended June 30, 2020. In addition, the Company expects a steady consolidated net loss for the three-month period ended June 30, 2021 of approximately $1.5 million, which we consider to be reasonably consistent with the second quarter of last year’s net loss of $1.5 million and believe this is attributable to consistent operational efficiency from a larger expense base. Deferred revenue in the second quarter of 2021 increased to $1.0 million compared to $0.3 million in the first quarter of 2021, which is the first period the Company received deferred revenues. The growth in revenues is primarily due to the Company’s focus on and introduction of new intelligent hardware products.

This preliminary financial information for the three months ended June 30, 2021 is based upon our estimates and subject to completion of our financial closing procedures. Moreover, these data have been prepared solely on the basis of currently available information by, and are the responsibility of, management. Our independent registered public accounting firm, RSM US LLP, has not audited or reviewed, and does not express an opinion with respect to, these data. This preliminary financial information is not a comprehensive statement of our financial results for this period, and our actual results may differ materially from these estimates due to the completion of our financial closing procedures, final adjustments, completion of the review of our financial statements and other developments that may arise between now and the time the review of our financial statements is completed. Our actual results for the three and six months ended June 30, 2021 will not be available until after this offering is completed. There can be no assurance that these estimates will be realized, and estimates are subject to risks and uncertainties, many of which are not within our control.

The Company’s Common Stock commenced trading on The Nasdaq Capital Market on July 7, 2021 under ticker symbol “MINM”.

A proposal on the amendment to our Amended and Restated Certificate of Incorporation was considered but not approved by the stockholders of the Company at its 2021 Annual Meeting of Stockholders held on June 2, 2021. The voting results of this proposal reflected a tabulation report that treated the proposal as “routine”; however, the Company’s proxy materials for the 2021 Annual Meeting of Stockholders described the proposal as “non-routine.” When tabulated as a non-routine matter, this proposal was not approved by the Company’s stockholders. Certain shares of Common Stock beneficially owned by executive officers and directors of the Company who had been stockholders of Zoom Connectivity, inadvertently were not voted at the meeting. If those votes had been cast at the meeting and were voted for the proposal, the proposal would have been approved by the requisite vote of the Company’s stockholders. On June 30, 2021, the Company filed with the Secretary of State of the State of Delaware a Certificate of Correction to void the previously filed amendment to the Company’s Certificate of Incorporation. The Company held a special meeting of stockholders on July 22, 2021 and received the requisite stockholder approval of the amendment. On July 23, 2021, the Company filed with the Delaware Secretary of State an amendment to the Company’s Amended and Restated Certificate of Incorporation to increase the number of authorized shares of capital stock to 62,000,000 shares, consisting of 60,000,000 shares of Common Stock and 2,000,000 shares of preferred stock, $0.001 par value per share (the “Preferred Stock”).

Corporate Information

We are incorporated in Delaware under the name Minim, Inc., formerly known as Zoom Telephonics, Inc., while maintaining the ZOOM trademark for products.  The Company was originally incorporated in New York in 1977 and changed its state of incorporation to Delaware in 1993. Our principal executive offices are located at 848 Elm Street, Manchester, NH 03101, and our telephone number is (833) 966-4646. Our main website is https://www.minim.com, and our Investor Relations website is located on https://ir.minim.com. Information contained on our website does not constitute part of this prospectus.

Market and Industry Data

Unless otherwise indicated, information contained in this prospectus concerning our industry, competitive position and the markets in which we operate is based on information from independent industry and research organizations, other third-party sources and management estimates. Management estimates are derived from publicly available information released by independent industry analysts and other third-party sources, as well as data from our internal research, and are based on assumptions we made upon reviewing such data, and our experience in, and knowledge of, such industry and markets, which we believe to be reasonable. In addition, projections, assumptions and estimates of the future performance of the industry in which we operate and our future performance are necessarily subject to uncertainty and risk due to a variety of factors, including those described in “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements.” These and other factors could cause results to differ materially from those expressed in the estimates made by the independent parties and by us.

SUMMARY OF THE OFFERING

Common Stock Offered		8,417,508 shares (or 9,680,134 shares if the underwriters exercise their option to purchase additional shares in full)

Common Stock Outstanding After the Offering		44,048,747 shares (or 45,311,373 shares if the underwriters exercise their option to purchase additional shares in full)

Use of Proceeds		We estimate that the net proceeds to us from this offering will be approximately $23,271,176, or approximately $26,758,675 if the underwriters exercise their option to purchase additional shares in full, assuming a public offering price of $2.97 per share (which was the closing price of our Common Stock as reported on The Nasdaq Capital Market on July 27, 2021), after deducting underwriting discounts and commissions. Each $1 increase (decrease) in the public offering price per share would increase (decrease) our net proceeds, after deducting estimated underwriting discounts and commissions, by approximately $7.8 million (assuming no exercise of the underwriters’ option to purchase additional shares).

		We intend to use the net proceeds from this offering for general corporate and working capital purposes, which may include inventory optimization, development and marketing of new product offerings and expansion into global markets. We may also use a portion of the net proceeds to pay down the revolving facility pursuant to the SVB Loan Agreement. See “Use of Proceeds.”

Underwriters’ Option		We have granted the underwriters a 30-day option to purchase a maximum of 1,262,626 additional shares of our Common Stock from us at the public offering price, less the underwriting discounts and commissions.

Voting Rights		Each share of Common Stock will entitle its holder to one vote on all matters to be voted on by stockholders. See “Description of Our Capital Stock.”

Dividend Policy		We do not expect to pay any dividends on our Common Stock in the foreseeable future. See “Dividend Policy.”

Risk Factors		Investing in our Common Stock involves substantial risk. You should read the “Risk Factors” section of this prospectus beginning on page 17 for a discussion of factors you should consider carefully before deciding to invest in our Common Stock.

Lock-Up		We and each of our officers, directors and certain affiliates have agreed, subject to certain exceptions, including, without limitation, not to sell, offer, agree to sell, contract to sell, hypothecate, pledge, grant any option to purchase, make any short sale of, or otherwise dispose of or hedge, directly or indirectly, any shares of our capital stock or any securities convertible into or exercisable or exchangeable for shares of capital stock, for a period of 90 days in the case of our executive officers, certain of our directors and certain affiliates and 120 days in the case of our Chairman and Director and his affiliated entities after the date of this prospectus, without the prior written consent of B. Riley Securities, Inc. See “Underwriting” for additional information.

Insider Participation		Certain of our officers, directors and employees, including Gray Chynoweth, our Chief Executive Officer, and certain of their respective affiliates, have indicated an interest in participating in this offering at the public offering price. We anticipate that such persons will purchase in the aggregate approximately 203,704 shares of Common Stock offered hereby. However, because indications of interest are not binding agreements or commitments to purchase, the underwriters could determine to sell fewer shares to them than they indicated an interest in purchasing or sell no shares to them, and they could determine to purchase fewer shares than they indicated an interest in purchasing or purchase no shares in this offering.

The Nasdaq Capital Market Symbol		MINM

Unless we indicate otherwise or the context otherwise requires, all information in this prospectus:

	●	gives effect to the consummation of this offering;

	●	assumes the shares of Common Stock are offered at $2.97 per share, which was the closing price of our Common Stock as reported on The Nasdaq Capital Market on July 27, 2021; and

	●	assumes no exercise by the underwriters of their option to purchase additional shares.

SELECTED CONSOLIDATED FINANCIAL DATA

The following tables present our selected consolidated financial data. The selected consolidated statements of operations data for the two years ended December 31, 2019 and 2020, and the selected consolidated balance sheets data as of December 31, 2019 and 2020 are derived from our audited consolidated financial statements that are incorporated by reference into this prospectus. The selected consolidated statements of operations data for the three months ended March 2021 and 2020 and the selected consolidated balance sheet data as of March 31, 2021 are derived from our unaudited interim condensed consolidated financial statements that are incorporated by reference into this prospectus. The unaudited interim condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements and, in the opinion of management, reflect all adjustments of a normal recurring nature that are necessary for the fair statement of our unaudited interim condensed consolidated financial statements.

The results of operations for the periods presented below are not necessarily indicative of the results that may be expected for any future period. You should read the historical financial data below in conjunction with the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the financial statements and related notes incorporated by reference into this prospectus.

MINIM, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

	Year Ended December 31,						Three Month Ended March 31,
	(Audited)						(Unaudited)
	2019			2020			2020			2021
Consolidated Statement of Operations Data
Net Sales	$	37,614,456		$	47,988,549		$	11,955,603		$	15,017,574
Cost of goods sold		26,708,653			34,382,314			8,860,385			9,913,784
Gross profit		10,905,803			13,606,235			3,095,218			5,103,790
Selling and marketing expenses		9,222,737			9,154,685			2,354,243			3,173,950
General and administrative expenses		2,666,876			5,443,529			827,939			1,077,368
Research and development expenses		2,237,416			3,828,223			652,752			1,388,170
Total operating expenses		14,127,029			18,426,437			3,834,934			5,639,488
Operating loss		(3,221,226	)		(4,820,202	)		(739,716	)		(535,698	)
Interest income		13,975			1,081			0			0
Interest expense		(48,404	)		(48,552	)		(5,398	)		(28,322	)
Other income (expense)		4,720			(21,356	)		(449	)		20,000
Gain on forgiveness of debt		-			1,057,330			-			-
Total other income (expense), net		(29,709	)		988,503			(5,847	)		(8,322	)
Loss before income taxes		(3,250,935	)		(3,831,699	)		(745,563	)		(544,020	)
Income taxes		24,865			26,716			6,316			1,500
Net loss	$	(3,275,800	)	$	(3,858,415	)	$	(751,879	)	$	(545,520	)
Basic and diluted net loss per share	$	(0.18	)	$	(0.15	)	$	(0.04	)	$	(0.02	)
Basic and Diluted:		18,051,070			25,300,976			21,080,179			35,254,243

MINIM, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

	Year Ended December 31, (Audited)
	2019		2020		March 31, (Unaudited) 2021		As Adjusted March 31, (Unaudited) 2021 (1)
Current Assets:
Cash and cash equivalents	$	1,216,893	$	771,757	$	397,713	$	23,668,889
Equipment, net		303,099		455,066		646,265		646,265
Other assets		349,335		942,404		974,021		974,021
Total assets	$	13,902,707	$	29,610,969	$	30,338,702	$	53,609,878
Liabilities and Stockholders’ Equity
Current Liabilities
Bank credit line	$	-	$	2,442,246	$	6,918,783	$	6,918,783
Accounts payable		5,024,529		11,744,834		10,049,107		10,049,107
Total current liabilities		7,793,716		21,783,019		22,146,203		22,146,203
Stockholders’ Equity
Common stock: Authorized: 40,000,000 shares at $0.01 par value; issued and outstanding: 35,362,854 shares at March 31, 2021; 35,074,922 shares and 20,929,928 shares at December 31, 2020 and 2019, respectively(2)		209,299		350,749		353,628		419,073
Total stockholders’ equity		6,108,991		7,790,470		8,028,815		31,299,991
Total liabilities and stockholders’ equity	$	13,902,707	$	29,610,969	$	30,338,702	$	53,609,878

	(1)	As adjusted to give pro forma effect to the use of the net proceeds, as described under “Use of Proceeds,” to us from this offering of $23,271,176 million from the sale of 8,417,508 shares of Common Stock, assuming a public offering price of $2.97 per share (which was the closing price of our Common Stock as reported on The Nasdaq Capital Market on July 27, 2021). Each $1.00 increase (decrease) in the assumed offering price of $2.97 per share, would increase (decrease) the pro forma as adjusted amount of cash and cash equivalents, total assets and total stockholders’ equity by $7.8 million, assuming that the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us.

	(2)	On July 23, 2021, our number of authorized shares of Common Stock was increased to 60,000,000 shares. Our shares of Common Stock outstanding as adjusted to give pro forma effect to the offering would be 44,048,747 (assuming no exercise by the underwriters of their option to purchase additional shares).

UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

On December 4, 2020, the Company completed its acquisition by merger of Zoom Connectivity, Inc., formerly known as Minim Inc. (the “Target”), pursuant to that certain Agreement and Plan of Merger (the “Merger Agreement”), dated as of November 12, 2020.

The accompanying unaudited pro forma condensed combined financial information is based on, and should be read in conjunction with, the historical financial statements and accounting records of the Target after giving effect to the Merger Agreement through the related pro forma adjustments. Further details about the Merger Agreement, along with key assumptions and estimates underlying the unaudited pro forma adjustments are described in the Notes to Unaudited Pro Forma Condensed Combined Financial Information set forth below.

The accompanying unaudited pro forma condensed combined statements of operations for year ended December 31, 2020, combined the historical consolidated statements of operations of the Company and the Target, giving effect to the Merger Agreement as if the merger had occurred on January 1, 2020, the first day of the Company’s calendar year ended December 31, 2020.

The accompanying pro forma adjustments are based on preliminary estimates that have been made solely for the purpose of providing unaudited pro forma condensed combined financial information prepared in accordance with the rules and regulations of the SEC. The unaudited pro forma condensed combined financial information does not purport to represent the actual results of operations that the Company and the Target would have achieved had the companies been combined during the periods presented herein.

The Company has prepared the following unaudited pro forma condensed combined financial information pursuant to the requirements of Article 11 of Regulation S-X, as amended by SEC Final Rule Release No. 33-10786, Amendments to Financial Disclosures About Acquired and Disposed Businesses. The unaudited pro forma condensed combined financial information is presented to illustrate the transaction accounting adjustments related to the merger. The unaudited pro forma condensed combined financial information is not intended to project the future results of operations that the combined company may achieve after the merger and does not reflect any adjustments for post-closing integration costs, or any potential cost savings or revenue enhancement synergies that may be realized as a result of the merger. Although the Company expects that some overall cost savings and revenue enhancement synergies will result from the merger, there can be no assurance that these expectations will be realized.

UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS

	For the twelve months ended December 31, 2020
	Minim, Inc.			Zoom Connectivity, Inc.			Pro Forma Adjustments				Pro Forma Combined
Total revenue	$	47,902,283		$	888,071			(364,015	)	(a)	$	48,426,339
Cost of sales		34,403,111			390,265			(164,477	)	(a)		34,628,899
Gross profit		13,499,172			497,806			(199,538	)			13,797,440
Selling and marketing expenses		8,949,870			919,635			-				9,869,505
General and administrative expenses		4,952,026			1,588,246			-				6,540,272
Research and development expenses		3,510,484			1,548,276			(135,000	)	(b)		4,923,760
Total operating expenses		17,412,380			4,056,157			(135,000	)			21,333,537
Operating loss		(3,913,208	)		(3,558,351	)		(64,538	)			(7,536,097	)
Interest income		1,077			825			-				1,902
Interest expense		(46,326	)		(11,610	)		-				(57,936	)
Other income (expense)		(21,326	)		-			-				(21,326	)
Gain on forgiveness of debt		512,800			544,500			-				1,057,300
Total other income (expense), net		446,225			533,715			-				979,940
Loss before income taxes		(3,466,983	)		(3,024,636	)		(64,538	)			(6,556,157	)
Income taxes		26,716			-			-				26,716
Net loss	$	(3,493,699	)	$	(3,024,636	)		(64,538	)		$	(6,582,873	)
Basic and diluted net loss per share	$	(0.15	)		-			-			$	(0.20	)
Weighted average common and common equivalent shares (Basic and Diluted)		22,848,602			-			10,784,534		(c)		33,633,136

	(a)	Represents the elimination of sales and cost of sales related to sales and services between Minim, Inc. and Zoom Connectivity, Inc. that are derived from the Statement of Work, License, Collaborative Agreement, Software/Service Availability Agreement and Software/Service Support Level Agreement between Minim, Inc. and Zoom Connectivity, Inc., dated July 25, 2019, as amended.
	(b)	Represents the elimination of engineering costs derived from the Statement of Work, License, Collaborative Agreement, Software/Service Availability Agreement and Software/Service Support Level Agreement between Minim, Inc. and Zoom Connectivity, Inc., dated July 25, 2019, as amended.
	(c)	The Company issued an aggregate of 10,784,534 shares of Common Stock to the shareholders of Zoom Connectivity, Inc., formerly known as Minim, Inc. The shares are considered outstanding as of January 1, 2020 giving effect to the Merger Agreement as if the merger had occurred on January 1, 2020, the first day of the Company’s calendar year ended December 31, 2020.

Notes to Unaudited Pro Forma Condensed Combined Financial Information

1. Description of Transaction

On November 12, 2020, the Company entered into the Merger Agreement pursuant to which the Company and the Target would merge and combine their businesses (the “Merger”). The Company’s Chairman and, principally through investment vehicles, controlling stockholder, is Chairman and a controlling stockholder of the Target.

Under the terms of the Merger Agreement by and among the Company, Elm Acquisition Sub, Inc., the Company’s wholly-owned subsidiary (“Merger Sub”), the Target and the Representative (as defined therein), Merger Sub merged with and into the Target, with the Target being the surviving entity and, following the closing of the Merger transaction, the Target became a wholly-owned subsidiary of the Company. Pursuant to the Merger Agreement, the Company exchanged 0.80106 newly-issued shares of the Company’s Common Stock for each issued and outstanding share of the Target’s common stock and preferred stock. In addition, the Company issued to each holder of the Target’s options and restricted stock, new Company options and restricted stock that are substantially equivalent and on the same terms as the respective holder’s options and restricted stock. Additionally, holders of certain outstanding convertible notes of the Target were exchanged for shares of Common Stock in accordance with the terms of the Merger Agreement. The transaction implied a valuation to the Target of approximately $30 million before taking into account transaction expenses and the exchange of the Target’s convertible notes.

Upon the closing of the Merger on December 4, 2020, the Target had 13,462,846 shares of common shares and equivalent preferred stock outstanding. These shares were exchanged for the 10,784,534 shares of the Common Stock. In addition, the holders of the Target’s stock options and restricted stock received 1,675,416 of the Company’s stock options in exchange for their 2,091,499 options outstanding.

2. Basis of Pro Forma Presentation

The pro forma presentation includes “Annual” statements of operations that give effect to the Merger as if this event had occurred on January 1, 2020, the first day of the Company’s calendar year ended December 31, 2020. The Annual unaudited pro forma condensed combined statement of operations includes the historical results for the Company and the Target for the calendar year ended December 31, 2020. The historical balance sheets and statements of operations of the Company and the Target as of March 31, 2021 and for the three months ended March 31, 2021, respectively, are not subject to pro forma presentation and are reported in the historical unaudited consolidated financial statements in the Quarterly Report on Form 10-Q for the quarter ended March 31, 2021 filed with the SEC on May 17, 2021.

RISK FACTORS

Investing in our Common Stock involves a high degree of risk. Before making an investment decision with respect to our Common Stock, you should carefully consider the following risks and all of the other information contained or incorporated by reference in the prospectus. If any of the following risks were to occur, our business, financial condition, results of operations, cash flows or prospects could be materially and adversely affected. In that event, the trading price of our Common Stock could decline, and you could lose all or part of your investment in our Common Stock. Some statements in this prospectus, including such statements in the following risk factors, constitute forward-looking statements. See “Cautionary Note Regarding Forward-Looking Statements.”

Risks Related to Our Business

The outbreak of the novel coronavirus (COVID-19) has had and will likely continue to adversely affect our business.

The novel strain of the coronavirus (COVID-19) has spread as a global pandemic throughout the world and has resulted in authorities imposing, and businesses and individuals implementing, numerous unprecedented measures to try to contain the virus. These efforts include travel bans and restrictions, quarantines, shelter-in-place/stay-at home and social distancing orders, and shutdowns. These measures have impacted and may further impact our workforce and operations, the operations of our customers, and those of our vendors, suppliers and manufacturing partners. The extent to which the COVID-19 pandemic will continue to affect our business, results of operations and financial condition is difficult to predict and depends on numerous evolving factors, including the duration and scope of the pandemic and its impact on overall global uncertainty; government, social, business, and other actions and have been and will be taken in response to the pandemic; and the effect of the pandemic on short- and long-term general economic conditions.

While our manufacturing partners and component suppliers mostly have been able to continue to operate to date in compliance with applicable regulations and current limitations, future restrictions on their operations could impact our ability to meet customer demand and could have a material adverse effect on our financial condition and results of operations, particularly if prolonged. Similarly, current and future restrictions or disruptions of transportation, such as reduced availability of air and ground transport, port closures or congestion, and increased border controls or closures, can also impact our ability to meet demand and could materially adversely affect us. We have already observed a significant increase in the cost of air freight as a result of the pandemic, which negatively affects our profitability as we seek to transport an increased number of products from manufacturing locations in Asia to North America and international markets as quickly as possible. We have also experienced an increase in costs for ocean freight and shortages in freight capacity, which can negatively impact our ability to ship volume predictably and on a lower cost basis. In addition, rapidly shifting consumer demand during the pandemic can lead to unexpected adverse impact on our results of operations. Although we have seen a significant increase in demand for our cable modems and gateway products due to consumers responding to work-from-home and shelter-in-place measures, we do not know how long this increase may last. In particular, as vaccines become widely available and consumers return to work or school and the impact of the COVID-19 pandemic lessens, this increase in demand may begin to subside. If this demand subsides at a rapid pace, our net sales, profitability and other financial results could be adversely affected. This increase in demand has also put strain on our manufacturing partners, suppliers and logistics partners to produce and deliver a sufficient number of products to meet this demand. In particular, the limited and delayed availability of certain key components for our products, such as specialized chipsets, significantly constrains our ability to meet the increased consumer demand and over the course of the past year, we have seen lead times for some of these key components increase dramatically from as low as 12 weeks to up to 50 weeks. This in turn puts pressure on our ability to accurately forecast and increases the likelihood that the accuracy of such forecasts will be lower, which could materially adversely affect our financial results. If we were to experience weakened demand in products, our net sales, profitability and other financial results would be materially adversely impacted.

The pandemic has significantly increased economic and demand uncertainty and also has led to increased disruption and volatility in capital markets and credit markets. The current severe economic slowdown resulting from the pandemic has already started to lead to a global recession. There is a significant degree of uncertainty and lack of visibility as to the extent and duration of any such slowdown or recession. Risks related to a slowdown or recession include the risk that demand for our products will be significantly harmed over time if consumers choose to delay product upgrades or various projects in order to conserve funds. Given the significant economic uncertainty and volatility created by the pandemic, it is difficult to predict the nature and extent of impacts on demand for our products. These expectations are subject to change without warning.

The spread of COVID-19 has caused us to modify our business practices, including employee travel, employee work locations, cancellation of physical participation in meetings, events and conferences, and social distancing measures. We may take further actions as may be required by government authorities or that we determine are in the best interests of our employees, customers, partners, vendors, and suppliers. Work-from-home and other measures introduce additional operational risks, including cybersecurity risks and have affected the way we conduct our product development, testing, customer support, and other activities, which could have an adverse effect on our operations. Furthermore, we rely on third-party laboratories to test and certify our products. If these service providers close or reduce staffing, it could delay our product development efforts. There is no certainty that such measures will be sufficient to mitigate the risks posed by the virus, and illness and workforce disruptions could lead to unavailability of key personnel and harm our ability to perform critical functions. In addition, work-from-home and related business practice modifications present challenges to maintaining our corporate culture, including employee engagement and productivity, both during the immediate pandemic crisis and as we make additional adjustments in the eventual transition from it.

The degree to which COVID-19 impacts our results will depend on future developments, which are highly uncertain and cannot be predicted, including how quickly and to what extent normal economic and operating conditions can resume. We are similarly unable to predict the degree to which the pandemic impacts our customers, suppliers, vendors, and other partners, and their financial conditions, but a material effect on these parties could also adversely affect us. The impact of COVID-19 can also exacerbate other risks discussed below, which could in turn have a material adverse effect on us. Developments related to COVID-19 have been rapidly changing, and additional impacts and risks may arise that we are not aware of or able to appropriately respond to currently. Should the COVID-19 situation or global economic slowdown not improve or worsen, or if our attempts to mitigate its impact on our operations and costs are not successful, our business, results of operations, financial condition and prospects may be adversely affected.

Our license agreements with Motorola have risks, including risks associated with our ability to successfully generate Motorola sales that are large enough to make our Motorola business profitable after we pay the minimum annual royalty payments required by the license agreements. Our failure to successfully increase Motorola sales could have a material effect on our liquidity and financial results.

A substantial amount of our net sales are generated by sales of products sold under our agreements to exclusively license the Motorola brand trademark for use with such products, which expires December 31, 2025. In connection with this opportunity, we have an aggressive plan to continue to introduce new Motorola brand products. Our product development plan has and will continue to increase our costs and may result in cost overruns and delays. If our sales of Motorola brand products do not meet our forecasts, this may result in excess inventory and a shortage of cash. In addition, each of the license agreements includes significant minimum quarterly royalty payments due by Minim. If we are unable to sell a sufficient number of Motorola brand products to offset these minimum royalty payments, our net income and cash position will be reduced, and we may continue to experience losses. There are provisions in both license agreements that could cause expiration at an earlier date. If our license agreements with Motorola were to be terminated for any reason, our net sales would be materially adversely affected.

We may require additional funding, which may be difficult to obtain on favorable terms, if at all.

Over the next 12 months we may require additional funding if, for instance, we buy inventory and develop products in anticipation of significant Motorola sales, if our sales are lower than forecast, or if we continue to experience losses. On March 12, 2021, we entered into a new loan and security agreement with Silicon Valley Bank (“SVB Loan Agreement”), which provides for a revolving facility up to a principal amount of $12.0 million. The availability of borrowings under the SVB Loan Agreement is subject to certain conditions and requirements. It is not certain whether all or part of this line of credit will be available to us in the future; and other sources of financing may not be available to us on a timely basis if at all, or on terms acceptable to us. If we fail to obtain acceptable additional financing when needed, we may not have sufficient resources to fund our normal operations; and this could have a material adverse effect on our business.

Our management has concluded that our disclosure controls and procedures and internal controls over financial reporting are ineffective due to the existence of a material weakness in our internal control over financial reporting. If we are unable to establish and maintain effective disclosure controls and internal control over financial reporting, our ability to produce accurate financial statements on a timely basis could be impaired, and the market price of our securities may be negatively affected.

A material weakness (as defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended (“Exchange Act”)), is a deficiency, or combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of a company’s annual or interim financial statements will not be prevented or detected on a timely basis. We carried out an evaluation, under the supervision and with the participation of management, of the effectiveness of the design and operation of our disclosure controls and procedures and internal control over financial reporting as of December 31, 2020. Based upon this evaluation, management has identified a deficiency related to the operation of a process level control to address the completeness and accuracy of unrecorded inventory and related liabilities at December 31, 2020.

Specifically, the Company identified inventory in-transit was not recorded upon the title transfer of the inventory to the Company, resulting in an understatement of inventory and related current liabilities. This error was corrected and impacted the consolidated balance sheet, other than stockholders’ equity, resulting in equal increases in the Company’s inventory and current liabilities, only for the year end December 31, 2020, and did not impact the consolidated statements of operations.

We may be unsuccessful in integrating the operations of the business we have acquired or expect to acquire in the future.

From time to time, we may acquire businesses, assets, or securities of companies that we believe will provide a strategic fit with our business. We integrate acquired businesses with our existing operations; our overall internal control over financial reporting processes; and our financial, operations, and information systems. If the financial performance of our business, as supplemented by the assets and businesses acquired, does not meet our expectations, it may make it more difficult for us to service our debt obligations and our results of operations may fail to meet market expectations. We may not effectively assimilate the business or product offerings of acquired companies into our business or within the anticipated costs or timeframes, retain key customers and suppliers or key employees of acquired businesses, or successfully implement our business plan for the combined business. In addition, our final determinations and appraisals of the estimated fair value of assets acquired and liabilities assumed in our acquisitions may vary materially from earlier estimates and we may fail to realize fully anticipated cost savings, growth opportunities or other potential synergies. We cannot assure that the fair value of acquired businesses or investments will remain constant.

Our business strategy includes significant growth plans, and our financial condition and results of operations could be negatively affected if we fail to grow or fail to manage our growth effectively.

We intend to pursue an organic growth strategy for our business; however, we regularly evaluate potential acquisitions and expansion opportunities. If appropriate opportunities present themselves, we expect to engage in selected acquisitions and other business growth initiatives or undertakings. There can be no assurance that we will successfully identify appropriate opportunities, that we will be able to negotiate or finance such activities or that such activities, if undertaken, will be successful. There are risks associated with our growth strategy. To the extent that we grow through acquisitions, we cannot ensure that we will be able to adequately or profitably manage this growth. Our existing operations, personnel, systems and internal control may not be adequate to support our growth and expansion and may require us to make additional unanticipated investments in our infrastructure.

Acquiring other companies or other assets, as well as other expansion activities, involves various risks including the risks of incorrectly assessing the value of acquired assets, encountering greater than expected costs of integrating, the risk of loss of customers and/or employees of the acquired business, executing cost savings measures, not achieving revenue enhancements and otherwise not realizing the transaction’s anticipated benefits. Our ability to address these matters successfully cannot be assured. In addition, our strategic efforts may divert resources or management’s attention from ongoing business operations, may require investment in integration and in development and enhancement of additional operational and reporting processes and controls.

Our growth initiatives may also require us to recruit and retain experienced personnel to assist in such initiatives. Accordingly, the failure to identify and retain such personnel would place significant limitations on our ability to successfully execute our growth strategy.

If we do not successfully execute our acquisition growth plan, it could adversely affect our business, financial condition, results of operations, reputation and growth prospects. In addition, if we were to conclude that the value of an acquired business had decreased and that the related goodwill had been impaired, that conclusion would result in an impairment of goodwill charge, which would adversely affect our results of operations. While we believe we will have the executive management resources and internal systems in place to successfully manage our future growth, there can be no assurance growth opportunities will be available or that we will successfully manage our growth.

Our reliance on a small number of customers for a large portion of our revenues could materially harm our business and prospects.

Relatively few companies account for a substantial portion of the Company’s revenues. In 2020, two companies accounted for 10% or greater individually, and 76% in the aggregate of the Company’s total net sales. At December 31, 2020, three companies with an accounts receivable balance of 10% or greater individually accounted for a combined 85% of the Company’s accounts receivable. In 2019, two companies accounted for 10% or greater individually, and 84% in the aggregate of the Company’s total net sales. At December 31, 2019, three companies with an accounts receivable balance of 10% or greater individually accounted for a combined 84% of the Company’s accounts receivable.

Our customers generally do not enter into long-term agreements obligating them to purchase our products. Because of our significant customer concentration, our net sales and operating income could fluctuate significantly due to changes in political or economic conditions or the loss of, reduction of business with, or less favorable terms for any of our significant customers. The loss of one or more of our largest customers, the failure of such customers to pay amounts due to us, or a material reduction in the amount of purchases made by such customers could have a material adverse effect on our business, financial position, results of operations and cash flows.

The market for Internet access products and services has many competing technologies, and the demand for certain of our products and services is declining.

If we are unable to grow demand for our broadband and dial-up modems or other products, we may be unable to sustain or grow our business. The market for high-speed communications products and services has a number of competing technologies. For instance, Internet access can be achieved by using a standard telephone line with an appropriate modem and dial-up or DSL service; using a cable TV line with a cable modem and cable modem service; or using a mobile broadband modem and mobile broadband service. We currently sell products that include all these technologies. The introduction of new products by competitors, market acceptance of competing products based on new or alternative technologies, or the emergence of new industry standards have in the past rendered and could continue to render our products less competitive or even obsolete.

Our reliance on sole suppliers or limited sources of supply could materially harm our business.

We obtain certain key parts, components, and equipment from sole or limited sources of supply. In 2020, the Company had two suppliers that provided 99% of the Company’s purchased inventory. In 2019, the Company had one supplier that provided 96% of the Company’s purchased inventory. Also, as examples, the vast majority of our broadband modems use Broadcom chipsets and the vast majority of our dial-up modems use Conexant chipsets. The loss of the products or services of any of our significant suppliers or a material change in their business or their relationship with us could harm our business and operating results. While many companies that use computer chips in their business experienced during 2020 supply chain issues in sourcing chips due to a chip shortage, we did not yet experience issues during 2020 resulting from material delays or unavailability of chips. There can be no assurance, however, that we will not experience such issues in the future. We have experienced delays in receiving shipments of essential integrated circuits during other past periods, and we may experience such delays in the future. Moreover, we cannot assure you that a chipset supplier will, in the future, sell chipsets to us in quantities sufficient to meet our needs or that we will purchase the specified dollar amount of products necessary to receive concessions and incentives from a chipset supplier. An interruption in a chipset supplier’s ability to deliver chipsets, a failure of our suppliers to produce chipset enhancements or new chipsets on a timely basis and at competitive prices, a material increase in the price of the chipsets, our failure to purchase a specified dollar amount of products or any other adverse change in our relationship with modem component suppliers could have a material adverse effect on our results of operations. In the past we have experienced long lead-times and significant delays in receiving shipments of modem chipsets from our sole source suppliers. We may experience similar delays in the future. In addition, some products may have other components that are available from only one source. If we are unable to obtain a sufficient supply of components from our current sources, we would experience difficulties in obtaining alternative sources or in altering product designs to use alternative components. Resulting delays or reductions in product shipments could damage relationships with our customers, and our customers could decide to purchase products from our competitors. Inability to meet our customers’ demand or a decision by one or more of our customers to purchase products from our competitors could harm our operating results.

We believe that our future success will depend in large part on our ability to more successfully penetrate the broadband modem markets, which have been challenging markets, with significant barriers to entry.

We believe that our future success depends in large part on our ability to penetrate the broadband modem markets including cable and mobile broadband. These markets have significant barriers to entry. Although some cable, and mobile broadband modems are sold at retail, the high-volume purchasers of these modems are concentrated in a relatively few large cable, telephone and mobile broadband service providers which offer broadband modem services to their customers. These customers, particularly cable and mobile broadband services providers, also have extensive and varied certification processes for modems to be approved for use on their network. Obtaining these certifications is expensive and time consuming, and the certification processes continue to evolve. Successfully penetrating the broadband modem market therefore presents a number of challenges including: the current limited retail market for broadband modems; the relatively small number of cable, telecommunications and Internet service provider customers that make up the bulk of the market for broadband modems in certain countries, including the United States; the significant bargaining power of these large volume purchasers; the time consuming, expensive, uncertain and varied certification process of the various cable service providers; the savings, if any, offered to customers who use their own modem instead of one supplied by the service provider; and the strong relationships with cable service providers enjoyed by incumbent cable equipment providers like Arris.

If we fail to meet changing customer requirements and emerging industry standards, there would be an adverse impact on our ability to sell our products and services.

The market for Internet access products and services is characterized by aggressive pricing practices, continually changing customer demand patterns, rapid technological advances, emerging industry standards and short product life cycles. Some of our product and service developments and enhancements have taken longer than planned and have delayed the availability of our products and services, which adversely affected our sales and profitability in the past. Any significant delays in the future may adversely impact our ability to sell our products and services, and our results of operations and financial condition may be adversely affected. Our future success will depend in large part upon our ability to: identify and respond to emerging technological trends and industry standards in the market; develop and maintain competitive products that meet changing customer demands; enhance our products by adding innovative features that differentiate our products from those of our competitors; bring products to market on a timely basis; introduce products that have competitive prices; manage our product transitions, inventory levels and manufacturing processes efficiently; respond effectively to new technological changes or new product announcements by others; meet changing industry standards; distribute our products quickly in response to customer demand; and compete successfully in the markets for our new products. These factors could also have an adverse effective on our operating results.

Our product cycles tend to be short and we may incur significant non-recoverable expenses or devote significant resources to sales that do not occur when anticipated. Therefore, the resources we devote to product development, sales and marketing may not generate material net sales for us. In addition, short product cycles have resulted in and may in the future result in excess and obsolete inventory, which has had and may in the future have an adverse effect on our results of operations. In an effort to develop innovative products and technology, we have incurred and may in the future incur substantial development, sales, marketing, and inventory costs. If we are unable to recover these costs, our financial condition and results could be adversely affected. In addition, if we sell our products at reduced prices in anticipation of cost reductions and we still have higher cost products in inventory, our business would be harmed, and our results of operations and financial condition would be adversely affected.

Our operations are subject to a number of risks that could harm our business.

Currently, our business is significantly dependent on our operations outside the US, particularly the production of substantially all of our products. For the fiscal year ending December 31, 2020, sales outside North America were only 1.8% of our net sales. However, almost all of our manufacturing operations are now located outside of the United States. The inherent risks of international operations could harm our business, results of operation, and liquidity. For instance, our operations in Mexico are subject to the challenges and risks associated with international operations, including those related to integration of operations across different cultures and languages, and economic, legal, political and regulatory risks. In addition, fluctuations in the currency exchange rates have had, and may continue to have, an adverse effect on our financial results. The types of risks faced in connection with international operations include, among others: regulatory and communications requirements and policy changes; currency exchange rate fluctuation, including changes in value of the VND, RMB and Mexican peso relative to the US dollar; cultural differences; reduced control over staff and other difficulties in staffing and managing foreign operations; reduced protection for intellectual property rights in some countries; political and economic changes and disruptions; governmental currency controls; shipping costs; strikes and work slowdowns at ports or other locations in the supply path; and import, export, and tariff regulations. Almost all of our products are built in Vietnam, mainland China or Taiwan, so these products are subject to numerous risks including currency risk and economic, legal, political and regulatory risks. Additionally, the US government has instituted or proposed other changes in trade policies that include the negotiation or termination of trade agreements economic sanctions on individuals, corporations or countries, and other government regulations affecting trade between the United States and other countries where we conduct our business. It may be time-consuming and expensive for us to alter our business operations in order to adapt to or comply with any such changes. If the United States were to withdraw from or materially modify international trade agreements to which it is a party, or if tariffs were imposed or raised on the products sourced from outside the United States that we buy, our costs for such products could increase significantly, which in turn could have a material adverse effect on our business, financial condition and results of operations.

If we fail to effectively manage our inventory levels, there could be a material and adverse effect on our liquidity and our business.

Due to rapid technological change and changing markets, we are required to manage our inventory levels carefully to both meet customer expectations regarding delivery times and to limit our excess inventory exposure. In the event we fail to effectively manage our inventory, our liquidity may be adversely affected and we may face increased risk of inventory obsolescence, a decline in market value of the inventory, or losses from theft, fire, or other casualty.

We may be unable to produce sufficient quantities of our products because we depend on third-party manufacturers. If these third-party manufacturers fail to produce quality products in a timely manner, our ability to fulfill our customer orders would be adversely impacted.

We use contract manufacturers and original design manufacturers for electronics manufacturing of most of our products. We use these third-party manufacturers to help ensure low costs, rapid market entry and reliability. Any manufacturing disruption could impair our ability to fulfill orders, and a failure to fulfill orders would adversely affect our sales. Although we currently use four electronics manufacturers for the bulk of our purchases, in some cases a given product is only provided by one of these companies. The loss of the services of any of our significant third-party manufacturers or a material adverse change in the business of or our relationships with any of these manufacturers could harm our business. Since third parties manufacture our products and we expect this to continue in the future, our success will depend, in part, on the ability of third parties to manufacture our products cost effectively and in sufficient quantities to meet our customer demand.

We are subject to the following risks because of our reliance on third-party manufacturers: reduced management and control of component purchases; reduced control over delivery schedules, quality assurance, manufacturing yields, and labor practices; lack of adequate capacity during periods of excess demand; limited warranties on products supplied to us; potential increases in prices; interruption of supplies from assemblers as a result of a fire, natural calamity, global health pandemic, strike or other significant event; and misappropriation of our intellectual property.

Our cable modem sales may be significantly reduced due to long lead-times.

During 2020, approximately 93% of net sales were cable and other broadband modems, of which 64% were WiFi-enabled devices. These products have experienced long lead-times due to certain component production lead-times of up to 20 weeks and due to manufacturer-related delays, and these long lead times may significantly reduce our potential sales.

We face significant competition, which could result in decreased demand for our products or services.

We may be unable to compete successfully. A number of companies have developed, or are expected to develop, products that compete or will compete with our products. Furthermore, many of our current and potential competitors have significantly greater resources than we do. Intense competition, rapid technological change and evolving industry standards could result in less favorable selling terms to our customers, decrease demand for our products or make our products obsolete. Our operating results and our ability to compete could be adversely affected if we are unable to: successfully and accurately anticipate customer demand; manage our product transitions, inventory levels and manufacturing processes efficiently; distribute or introduce our products quickly in response to customer demand and technological advances; differentiate our products from those of our competitors; or otherwise compete successfully in the markets for our products.

Our future success will depend on the continued services of our key product development personnel.

The loss of any of our key product development personnel, the inability to attract or retain qualified personnel in the future, or delays in hiring skilled personnel could harm our business. Competition for skilled personnel is significant. We may be unable to attract and retain all the personnel necessary for the development of our business. In addition, the loss of any member of the senior management team, a key engineer or salesperson, or other key contributors, could harm our relations with our customers, our ability to respond to technological change, and our business.

Risks Related to International Operations

Fluctuations in the foreign currency exchange rates in relation to the US dollar could have a material adverse effect on our operating results.

Changes in currency exchange rates that increase the relative value of the US dollar may make it more difficult for us to compete with foreign manufacturers on price, may reduce our foreign currency denominated sales when expressed in dollars, or may otherwise have a material adverse effect on our sales and operating results. A significant increase in our foreign currency denominated sales would increase our risk associated with foreign currency fluctuations. A weakness in the US dollar relative to the Mexican peso and various Asian currencies, especially the Vietnamese dong (“VND”) and the Chinese renminbi (“RMB”), could increase our product costs. Fluctuations in the currency exchange rates have, and may continue to, adversely affect our operating results.

Capacity constraints in our Mexican operations could reduce our sales and revenues and hurt customer relationships.

We rely on our Mexican operations to finish and ship most of the products we sell. Since moving our operations to our Mexican facility we have experienced and may continue to experience constraints on our capacity as we address challenges related to operating our new facility, such as hiring and training workers, creating the facility’s infrastructure, developing new supplier relationships, complying with customs and border regulations, and resolving shipping and logistical issues. Our net sales may be reduced, and our customer relationships may be impaired if we continue to experience constraints on our capacity. We are working to minimize capacity constraints in a cost-effective manner, but there can be no assurance that we will be able to adequately minimize capacity constraints.

Our reliance on a business processing outsourcing partner to conduct our operations in Mexico could materially harm our business and prospects.

In connection with our North American manufacturing operations in Mexico, we rely on a business processing outsourcing partner to hire, subject to our oversight, the team for our Mexican operations, provide the selected facility described above, and coordinate many of the ongoing logistics relating to our operations in Mexico. Our outsourcing partner’s related functions include acquiring the necessary Mexican permits, providing the appropriate Mexican operating entity, assisting in customs clearances, and providing other general assistance and administrative services in connection with the ongoing operation of the Mexican facility. Our outsourcing partner’s performance of these obligations efficiently and effectively is critical to the success of our operations in Mexico. Failure of our outsourcing partner to perform its obligations efficiently and effectively could result in delays, unanticipated costs or interruptions in production, delays in deliveries to our customers or other harm to our business, results of operation, and liquidity. Moreover, if our outsourcing arrangement is not successful, we cannot assure our ability to find an alternative production facility or outsourcing partner to assist in our operations in Mexico or our ability to operate successfully in Mexico without outsourcing or similar assistance.

Tariffs significantly harm our cash flow and profitability, and they may continue to do that in the future.

Since September 24, 2018, almost all of our products produced in China have been subject to a tariff on our cost of goods at the time of entry into the United States. The tariff started at 10% and increased to 25% in June 2019. These tariffs have a significant impact on our cost of inventory and profitability. These tariffs may not be reduced and may even be increased. Although we have actively worked on finding production capability outside China, it is not possible to predict the impact of tariffs in the future, which could have a material adverse impact on our net income and cash position and we may continue to experience losses.

Risks Related to Our Products, Technology and Intellectual Property

We may be subject to product returns resulting from defects or from overstocking of our products. Product returns could result in the failure to attain market acceptance of our products, which would harm our business.

If our products contain undetected defects, errors, or failures, we could face delays in the development of our products, numerous product returns, and other losses to us or to our customers or end users. Any of these occurrences could also result in the loss of or delay in market acceptance of our products, either of which would reduce our sales and harm our business. We are also exposed to the risk of product returns from our customers as a result of contractual stock rotation privileges and our practice of assisting some of our customers in balancing their inventories. Overstocking has led in the past and may lead in the future to higher than normal customer returns.

Security breaches and data loss may expose us to liability, harm our reputation and adversely affect our business.

As part of our business operations, we collect, store, process, use and disclose sensitive data relating to our business, including in connection with the provision of our cloud services and in our information systems and data centers (including third-party data centers). We also engage third-party providers to assist in the development of our products and for services that may include the collection, handling, processing and storage of personal data on our behalf. In addition, we host our customers’ subscriber data in third-party data centers in the course of providing our products and cloud-based platform solutions and services to our customers. While we and our third-party providers apply multiple layers of security to control access to data and use encryption and authentication technologies to secure data from unauthorized access, use, alteration and disclosure, these security measures may be compromised. Malicious hackers may attempt to gain access to our network or data centers; steal proprietary information related to our business, products, employees and customers; or interrupt our systems and services or those of our customers or others. In particular, there has been a spike in cybersecurity attacks during the COVID-19 pandemic and work-from-home environment.

Some of our software products contain “open source” software under terms of open source licenses, which include, but are not limited to, General Public License Version 2 and MIT Licenses.

The use of open source software has risks related to open source license compliance and software quality control. The Company mitigates these risks by employing processes such as open source license review prior to technology selection and upgrade version testing prior to deployment. However, it must be noted that the risks described above cannot be eliminated.

We may experience costs and senior management distractions due to patent-related matters.

Many of our products incorporate patented technology. We attempt to license appropriate patents either directly or through our integrated circuit suppliers. However, we are subject to costs and senior management distractions due to patent-related litigation.

Patent litigation matters are complex and time consuming and expose us to potentially material obligations. It is impossible to assess the potential cost and senior management distraction associated with patent litigation matters that are currently outstanding or may occur in the future.

We may have difficulty protecting our intellectual property.

Our ability to compete is heavily affected by our ability to protect our intellectual property. We rely primarily on trade secret laws, confidentiality procedures, patents, copyrights, trademarks, and licensing arrangements to protect our intellectual property. The steps we take to protect our technology may be inadequate. Existing trade secret, trademark and copyright laws offer only limited protection. Our patents could be invalidated or circumvented. We have more intellectual property assets in some countries than we do in others. In addition, the laws of some foreign countries in which our products are or may be developed, manufactured or sold may not protect our products or intellectual property rights to the same extent as do the laws of the United States. This may make the possibility of piracy of our technology and products more likely. Litigation, which could consume financial and management resources, may be necessary to enforce the Company’s patents or other intellectual property rights.

In February 2021, Zoom Video Communications, Inc. filed a petition with the US Patent and Trademark Office seeking cancellation of the Company’s ZOOM® trademark. The Company believes it has meritorious defenses to the petition and intends vigorously to oppose the cancellation petition. We cannot ensure that the steps that we have taken to protect our intellectual property will be adequate to prevent misappropriation of our technology.

We could infringe the intellectual property rights of others.

Particular aspects of our technology could be found to infringe on the intellectual property rights or patents of others. Other companies may hold or obtain patents on inventions or may otherwise claim proprietary rights to technology necessary to our business. We cannot predict the extent to which we may be required to seek licenses. We cannot assure you that the terms of any licenses we may be required to seek will be reasonable. We are often indemnified by our suppliers relative to certain intellectual property rights. However, these indemnifications do not cover all possible suits, and there can be no assurance that a relevant indemnification will be honored by the indemnifying party or that the indemnifying party has the financial resources to meet its indemnification obligation.

From time to time, the Company may become involved in various lawsuits and legal proceedings, including intellectual property infringement claims. Due to the existence of a large number of intellectual property rights in the fields in which the Company operates and the rapid rate of issuance of new intellectual property rights, it is difficult to completely judge in advance whether a product or any of its components may infringe upon the intellectual property rights of others. Whether or not intellectual property infringement claims against the Company have merit, significant financial and management resources may be required to defend the Company from such claims.

Financial, Regulatory and Tax Compliance Risks

We could be subject to additional sales tax or other tax liabilities.

States have varying policies regarding when a company has a taxable presence in the state. There are many factors to consider when determining if state nexus exists, including inventory consignment to ordering and fulfillment, physical presence, economic presence, and personnel. We have policies and procedures in place to collect and pay sales tax for Amazon sales in states where we believe we have nexus and are required to charge sales tax. However, it is possible that we could be negatively impacted by a change in state laws and policies, court decisions, Federal law, or our decisions about where sales tax is owed. In addition, we may incur income tax liability in some states where we have nexus.

We may be exposed to risks related to litigation and administrative proceedings that could materially and adversely affect our business, results of operations and financial condition.

Our business may expose us to litigation and administrative proceedings relating to corporate matters, labor, regulatory, tax proceedings, governmental investigations, contractual disputes, shareholder disputes and criminal prosecution, among other matters, that could materially and adversely affect our business, results of operations, and financial condition. In the context of these proceedings, we may not only be required to pay fines or monetary damages but also be subject to sanctions or injunctions affecting our ability to continue our operations. While we may contest these matters vigorously and make insurance claims when appropriate, litigation and other proceedings are inherently costly and unpredictable, making it difficult to accurately estimate the outcome of actual or potential litigation or proceedings. Although we will establish provisions in accordance with the requirements of generally accepted accounting principles, the amounts that we reserve could vary significantly from any amounts we actually pay due to the inherent uncertainties in the estimation process. In addition, litigation and administrative proceedings can involve significant management time and attention and be expensive, regardless of outcome. During the course of any litigation and administrative proceedings, there may be announcements of the results of hearings and motions and other interim developments.

On February 16, 2021, the Company received a letter from a law firm representing a purported stockholder of the Company requesting the opportunity to review certain books and records of the Company to investigate the possibility of breaches of fiduciary duty by current and former members of the Board of Directors and the Company’s controlling stockholder in connection with his and his affiliates’ acquisition of majority control of the Company without compensating the Company’s minority stockholders and the acquisition by merger of Zoom Connectivity in which he held a substantial equity stake. The parties have been in negotiations with the counsel for the purported stockholder to resolve this matter. The Company believes that the resolution of this matter is likely to include the imposition of certain corporate governance restrictions, which would expand on current practices of the Company over a longer period of time than the standstill agreement currently in effect with the Company’s controlling stockholder, on the Company and the controlling stockholder and his affiliates and the payment of legal expenses. The matter is under negotiation and is subject to change based upon the negotiations and any other factors that may arise. There can be no assurance that this matter will be resolved on satisfactory terms.

On June 29, 2021, the Company received a letter from a law firm representing a purported stockholder of the Company making a litigation demand on behalf of the Company and its stockholders to address certain alleged misconduct by the Company’s Board of Directors in connection with the implementation of an amendment to the Company’s Amended and Restated Certificate of Incorporation without having received proper stockholder approval thereof as required under Delaware corporation law. The letter demanded that the Board of Directors take immediate action to: deem the amendment ineffective and make appropriate disclosure of that fact and seek a valid stockholder approval of the amendment; and adopt and implement adequate internal controls and systems at the Company designed to prohibit and prevent a recurrence of the circumstances. The letter requested a response or contact with the law firm on or before July 16, 2021. On June 30, 2021, the Company filed with the Delaware Secretary of State a Certificate of Correction to void the previously filed amendment to the Company’s Amended and Restated Certificate of Incorporation. The Company filed an amendment to a Current Report on Form 8-K to disclose these matters. The Company held a special meeting of stockholders on July 22, 2021 and received the requisite stockholder approval of the amendment. On July 23, 2021, the Company filed with the Delaware Secretary of State an amendment to the Company’s Amended and Restated Certificate of Incorporation to increase the number of authorized shares of capital stock to 62,000,000 shares, consisting of 60,000,000 shares of Common Stock and 2,000,000 shares of Preferred Stock. The Company filed a Current Report on Form 8-K to disclose these matters. It is also expected that the Nominating and Governance Committee of the Board of Directors will review the Company’s internal controls and systems and the circumstances described in the demand letter to determine if any additional actions are necessary to prevent the recurrence of the circumstances relating to the foregoing events. The Company anticipates that the law firm that sent the demand letter will seek recovery of attorneys’ fees relating to this matter. The ultimate amount of any such recovery could be material but is not presently ascertainable. The Company intends vigorously to defend against any such claim for recovery of legal fees. There can be no assurance that this matter will be resolved on satisfactory terms.

See “Business—Legal Matters.”

Environmental regulations may increase our manufacturing costs and harm our business.

In the past, environmental regulations have increased our manufacturing costs and caused us to modify products. New state, US, or other regulations may in the future impact our product costs or restrict our ability to ship certain products into certain regions.

Changes in current or future laws or governmental regulations and industry standards that negatively impact our products, services and technologies could harm our business.

The jurisdiction of the Federal Communications Commission (“FCC”), extends to the entire US communications industry including our customers and their products and services that incorporate our products. Our products are also required to meet the regulatory requirements of other countries throughout the world where our products and services are sold. Obtaining government certifications is time-consuming and costly. In the past, we have encountered delays in the introduction of our products, such as our cable modems, as a result of the need to obtain government certifications. We may face further delays if we are unable to comply with governmental regulations. Delays caused by the time it takes to comply with regulatory requirements may result in cancellations or postponements of product orders or purchases by our customers, which would harm our business.

In addition to reliability and quality standards, the market acceptance of certain products and services is dependent upon the adoption of industry standards so that products from multiple manufacturers are able to communicate with each other. Standards are continuously being modified and replaced. As standards evolve, we may be required to modify our existing products or develop and support new versions of our products. The failure of our products to comply, or delays in compliance, with various existing and evolving industry standards could delay or interrupt volume production of our products, which could harm our business.

Our ability to use our net operating losses (“NOLs”) may be negatively affected if there is an “ownership change” as defined under Section 382 of the Internal Revenue Code.

At December 31, 2020, we had approximately $61.8 million in federal NOLs. These deferred tax assets are currently fully reserved. Under Internal Revenue Code Section 382 rules, if a change of ownership is triggered, our ability to use our NOLs can be negatively affected if there is an “ownership change” as defined under Internal Revenue Code Section 382. An ownership change at any time is determined by considering each stockholder with 5% or more ownership, summing the highest percentage change for each of those stockholders over the prior three years, and determining that the sum exceeds 50%. The Company believes that a change of ownership limiting the use of our NOLs occurred during 2020. The Company is in the process of determining the impact of any such limitation. Since ownership changes are measured over three-year periods, it is possible that additional changes of ownership may occur in the future.

Risks Related to Our Common Stock and this Offering

The market price of our Common Stock may be volatile and trading volume may be low.

The market price of our Common Stock could fluctuate significantly for many reasons, including, without limitation: as a result of the risk factors listed herein; actual or anticipated fluctuations in our operating results; regulatory changes that could impact our business; and general economic and industry conditions. Shares of our Common Stock are listed on The Nasdaq Capital Market. The lack of an active market may impair the ability of holders of our Common Stock to sell their shares of Common Stock at the time they wish to sell them or at a price that they consider reasonable. The lack of an active market may also reduce the fair market value of the shares of our Common Stock.

We do not expect to pay any dividends in the foreseeable future.

We do not expect to declare dividends in the foreseeable future. We currently intend to retain cash to support our operations and to finance the growth and development of our business. There can be no assurance that we will have, at any time, sufficient surplus under Delaware law to be able to pay any dividends. In addition, pursuant to the SVB Loan Agreement, we cannot pay any dividends without Silicon Valley Bank’s prior written consent. If we do not pay dividends, the price of our Common Stock must appreciate for you to receive a gain on your investment in the Company.

Our Chairman and his family own a significant percentage of our shares, which will limit your ability to influence corporate matters.

Our Chairman, and his family owned approximately 50.0% percent of our outstanding shares of Common Stock as of July 1, 2021. Accordingly, he could have a significant influence over the outcome of any corporate transaction or other matter submitted to our stockholders for approval, including the election of directors, mergers, consolidations and the sale of all or substantially all of our assets and also could prevent or cause a change in control. The interests of the Chairman and his family may differ from the interests of our other stockholders. Third parties may be discouraged from making a tender offer or bid to acquire us because of this concentration of ownership.

An investment in the shares is speculative and there can be no assurance of any return on any such investment.

An investment in the shares is speculative and there can be no assurance that investors will obtain any return on their investment. Investors will be subject to substantial risks involved in an investment in the Company, including the risk of losing their entire investment.

Common Stock eligible for future sale may adversely affect the market.

From time to time, certain of the Company’s shareholders may be eligible to sell all or some of their shares of Common Stock by means of ordinary brokerage transactions in the open market pursuant to Rule 144, promulgated under the Securities Act, subject to certain limitations, or pursuant to a shelf registration statement for the resale of their shares. Any substantial sale of the Company’s Common Stock pursuant to Rule 144 or pursuant to any resale prospectus (including sales by investors of shares purchased pursuant to this prospectus) may have a material adverse effect on the market price of the Common Stock.

If we sell shares of our Common Stock in future financings, stockholders may experience immediate dilution and, as a result, our stock price may decline.

We may from time to time issue additional shares of Common Stock at a discount from the current market price of our Common Stock. As a result, our stockholders would experience immediate dilution upon the purchase of any shares of our Common Stock sold at such discount. In addition, as opportunities present themselves, we may enter into financing or similar arrangements in the future, including the issuance of debt securities, Preferred Stock or Common Stock. If we issue Common Stock or securities convertible or exercisable into Common Stock, our common stockholders would experience additional dilution and, as a result, our stock price may decline.

We will have broad discretion in how we use the net proceeds of this offering. We may not use these proceeds effectively, which could affect our results of operations and cause our stock price to decline.

SEC Form S-1/A filed by Minim Inc. (Amendment)