EFOI - Energy Focus Announces $1.3 Million Investment and Changes to Board of Directors
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Energy Focus, Inc.(NASDAQ:EFOI), a leader in sustainable, energy-efficient lighting andcontrols systems for the commercial, military, and maritime markets,today announces that on June 29, 2023 the company entered into apurchase agreement for the issuance and sale of 746,875 shares of theCompany’s common stock in a private placement priced at fair marketvalue under the rules of The Nasdaq Stock Market (“Nasdaq”).
Theprivate placement closed on June 29, 2023, and was facilitated bycertain purchasers associated with Sander Electronics following thepreviously announced strategic investment in early 2023.
“JayHuang, Chairman of the Energy Focus Board of Directors and Presidentof Sander Electronics, has been an essential leader for setting EnergyFocus up for future success,” said Lesley Matt, Chief ExecutiveOfficer of Energy Focus. “His faith and commitment to bringinginnovative energy solutions products to expand our product footprintis essential in developing the road map toward future success. Thisadditional investment will help us to realize those plans.”
Following the Private Placement, the Company appointed Kin-FuChen, Dr. Shou-Jang Lee, Jason Tien-Chia Tsai, and Dr. Chao-Jen Huangto the Board of Directors. The new directors bring with them a widerange of expertise in different areas of finance, economics, andbusiness. Four previous directors voluntarily resigned from the Board. These directors fill vacancies created by four resignations from theBoard on June 28, 2023.
“I am excited to tap into the new boardmember’s wide range of knowledge in global trade, financial markets,government affairs and innovation in new energy developments,” saidMatt. “I believe their strong backgrounds will bring new perspectiveto better align with future growth and the expansion of EnergyFocus’ product portfolio to include new innovations in energysolutions products.”
Gross proceeds to the Company in respect ofthe Private Placement is approximately $1.3 million, before offeringexpenses payable by the Company. Energy Focus intends to use theproceeds from this transaction for general corporate purposes.
Theoffer and sale of the foregoing securities are being made in atransaction not involving a public offering and have not beenregistered under the Securities Act of 1933 (the “SecuritiesAct”), or applicable state securities laws. Accordingly, thesecurities may not be reoffered or resold in the United States exceptpursuant to an effective registration statement or an applicableexemption from the registration requirements of the Securities Act andsuch applicable state securities laws.
Energy Focus is an industry-leading innovatorof sustainable light-emitting diode (“LED”) lighting and lightingcontrol technologies and solutions. As the creator of the firstflicker-free LED lamps, Energy Focus develops high quality LEDlighting products and controls that provide extensive energy andmaintenance savings, as well as aesthetics, safety, health andsustainability benefits over conventional lighting. In 2023, EFOIannounced plans to add high efficiency GaN (gallium nitride) powersupply products to its product portfolio. Energy Focus isheadquartered in Solon, Ohio. For more information, visit our websiteat www.energyfocus.com.
Forward-LookingStatements:
Forward-looking statements in this release aremade pursuant to the safe harbor provisions of the Private SecuritiesLitigation Reform Act of 1995. These statements can generally beidentified by the use of forward-looking terminology, including theterms “believes,” “estimates,” “anticipates,”“expects,” “feels,” “seeks,” “forecasts,”“projects,” “intends,” “plans,” “may,” “will,”“should,” “could” or “would” or, in each case, theirnegative or other variations or comparable terminology. Theseforward-looking statements include all matters that are not historicalfacts and include statements regarding our intentions, beliefs orcurrent expectations concerning, among other things, our results ofoperations, financial condition, liquidity, prospects, growth,strategies, capital expenditures, and the industry in which weoperate. By their nature, forward-looking statements involve risks anduncertainties because they relate to events and depend oncircumstances that may or may not occur in the future. Although webase these forward-looking statements on assumptions that we believeare reasonable when made in light of the information currentlyavailable to us, we caution you that forward-looking statements arenot guarantees of future performance and that our actual results ofoperations, financial condition and liquidity, and industrydevelopments may differ materially from statements made in orsuggested by the forward-looking statements contained in this release.We believe that important factors that could cause our actual resultsto differ materially from forward-looking statements include, but arenot limited to: (i) our need for and ability to obtain additionalfinancing in the near term, on acceptable terms or at all, to continueour operations; (ii) our ability to regain and maintain compliancewith the continued listing standards of The Nasdaq Stock Market (iii)our ability to refinance or extend maturing debt on acceptable termsor at all; (iv) our ability to continue as a going concern for areasonable period of time; (v) our ability to realize synergies withour strategic investor; (vi) instability in the U.S. and globaleconomies and business interruptions experienced by us, our customersand our suppliers, particularly in light of supply chain constraintsand other long-term impacts of the coronavirus pandemic; (vii) thecompetitiveness and market acceptance of our LED lighting and controltechnologies and products; (viii) our ability to compete effectivelyagainst companies with lower prices or cost structures, greaterresources, or more rapid development capabilities, and new competitorsin our target markets; (ix) our ability to extend our productportfolio into new applications and end markets; (x) our ability toincrease demand in our targeted markets and to manage sales cyclesthat are difficult to predict and may span several quarters; (xi) thetiming of large customer orders, significant expenses and fluctuationsbetween demand and capacity as we manage inventory and invest ingrowth opportunities; (xii) our ability to successfully scale ournetwork of sales representatives, agents, distributors and otherchannel partners to compete with the sales reach of larger,established competitors; (xiii) our ability to implement plans toincrease sales and control expenses; (xiv) our reliance on a limitednumber of customers for a significant portion of our revenue, and ourability to maintain or grow such sales levels; (xv) our ability to addnew customers to reduce customer concentration; (xviii) our ability toattract and retain a new chief financial officer; (xvii) our abilityto manage the size of our workforce while continuing to attract,develop and retain qualified personnel, and to do so in a timelymanner; (xviii) our ability to diversify our reliance on a limitednumber of third-party suppliers and development partners, our abilityto manage third-party product development and obtain criticalcomponents and finished products on acceptable terms and of acceptablequality despite ongoing global supply chain challenges, and the impactof our fluctuating demand on the stability of such suppliers; (xix)our ability to timely, efficiently and cost-effectively transportproducts from our third-party suppliers by ocean marine and otherlogistics channels despite global supply chain and logisticsdisruptions; (xx) the impact of any type of legal inquiry, claim ordispute; (xxi) the macro-economic conditions, including risinginterest rates and recessionary trends, in the United States and inother markets in which we operate or secure products, which couldaffect our ability to obtain raw materials, component parts, freight,energy, labor, and sourced finished goods in a timely andcost-effective manner; (xxii) our dependence on military maritimecustomers and on the levels and timing of government funding availableto such customers, as well as the funding resources of our othercustomers in the public sector and commercial markets; (xxix) businessinterruptions resulting from geopolitical actions such as war andterrorism, natural disasters, including earthquakes, typhoons, floodsand fires, or from health epidemics, or pandemics or other contagiousoutbreaks; (xxx) our ability to respond to new lighting and controltechnologies and market trends; (xxxi) our ability to fulfill ourwarranty obligations with safe and reliable products; (xxxii) anydelays we may encounter in making new products available or fulfillingcustomer specifications; (xxxiii) any flaws or defects in our productsor in the manner in which they are used or installed; (xxix) ourability to protect our intellectual property rights and otherconfidential information, and manage infringement claims by others;(xxx) our compliance with government contracting laws and regulations,through both direct and indirect sale channels, as well as other laws,such as those relating to the environment and health and safety;(xxxi) risks inherent in international markets, such as economic andpolitical uncertainty, changing regulatory and tax requirements andcurrency fluctuations, including tariffs and other potential barriersto international trade; and (xxix) our ability to maintain effectiveinternal controls and otherwise comply with our obligations as apublic company. For additional factors that could cause our actualresults to differ materially from the forward-looking statements,please refer to our most recent annual report on Form 10-K andquarterly reports on Form 10-Q filed with the Securities and ExchangeCommission.
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