Form 10-Q - Quarterly report [Sections 13 or 15(d)]

Share Name	Share Symbol	Market	Type
BK Technologies Corporation	AMEX:BKTI	AMEX	Common Stock

	Price Change	% Change	Share Price	High Price	Low Price	Open Price	Shares Traded	Last Trade
	-0.44	-3.21%	13.26	13.97	13.22	13.63	46,685	01:00:00

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2023

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _________ to _________

Commission File Number: 001-32644

BK Technologies Corporation

(Exact name of registrant as specified in its charter)

Nevada		83-4064262
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

7100 Technology Drive

West Melbourne, Florida 32904

(Address of principal executive offices and Zip Code)

Registrant’s telephone number, including area code: (321) 984-1414

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class		Trading Symbol(s)		Name of Each Exchange on Which Registered
Common Stock, par value $0.60 per share		BKTI		NYSE American

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

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	☒	Smaller reporting company	☒
		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 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

There were 3,455,499 shares of common stock, $0.60 par value, of the registrant outstanding as of November 6, 2023.

TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION		1

Item 1.	FINANCIAL STATEMENTS	1

Item 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	15

Item 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.	24

Item 4.	CONTROLS AND PROCEDURES	25

PART II - OTHER INFORMATION		26

Item 1A.	RISK FACTORS	26

Item 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	26

Item 6.	EXHIBITS	27

SIGNATURES		28

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PART I - FINANCIAL INFORMATION

Item 1. FINANCIAL STATEMENTS

BK TECHNOLOGIES CORPORATION

Condensed Consolidated Balance Sheets

(In thousands, except share data)

	September 30, 2023			December 31, 2022
	(Unaudited)
ASSETS

Current assets:
Cash and cash equivalents	$	4,066		$	1,918
Trade accounts receivable, net		9,110			10,616
Inventories, net		21,573			22,105
Prepaid expenses and other current assets		1,963			1,578
Total current assets		36,712			36,217

Property, plant and equipment, net		5,501			4,884
Right-of-use (ROU) assets		1,669			1,991
Investments		650			1,481
Deferred tax assets, net		4,116			4,116
Other assets		420			143
Total assets	$	49,068		$	48,832

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:
Accounts payable	$	11,763		$	12,898
Accrued compensation and related taxes		1,555			1,143
Accrued warranty expense		736			591
Accrued other expenses and other current liabilities		642			700
Short-term lease liabilities		514			485
Credit facility		6,459			5,854
Notes payable-current portion		94			277
Deferred revenue		1,110			1,022
Total current liabilities		22,873			22,970

Notes payable, net of current portion		—			329
Long-term lease liabilities		1,396			1,785
Deferred revenue		6,185			3,613
Total liabilities		30,454			28,697
Commitments and contingencies
Stockholders’ equity:
Preferred stock; $1.00 par value; 1,000,000 authorized shares; none issued or outstanding		—			—
Common stock; $0.60 par value; 10,000,000 authorized shares; 3,722,970 and 3,686,939 issued and 3,432,890 and 3,396,859 outstanding shares as of September 30, 2023, and December 31, 2022, respectively		2,234			2,212
Additional paid-in capital		46,281			45,304
Accumulated deficit		(24,499	)		(21,979	)
Treasury stock, at cost, 290,080 shares as of September 30, 2023, and December 31, 2022, respectively		(5,402	)		(5,402	)
Total stockholders’ equity		18,614			20,135
Total liabilities and stockholders’ equity	$	49,068		$	48,832

See Accompanying Notes to Condensed Consolidated Financial Statements.

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BK TECHNOLOGIES CORPORATION

Condensed Consolidated Statements of Operations

(In thousands, except share and per share data) (Unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2023			2022			2023			2022
Sales, net	$	20,069		$	11,917		$	57,786		$	30,612
Expenses
Cost of products		13,663			9,676			41,282			25,175
Selling, general and administrative expenses		5,812			4,632			17,681			14,952
Total operating expenses		19,475			14,308			58,963			40,127

Operating income (loss)		594			(2,391	)		(1,177	)		(9,515	)

Other (expense) income:
Net interest expense		(131	)		(30	)		(429	)		(70	)
Gain (Loss) on investments		(342	)		76			(831	)		(1,021	)
Other expense		(31	)		(57	)		(83	)		(66	)
Total other expense, net		(504	)		(11	)		(1,343	)		(1,157	)

Income (loss) before income taxes		90			(2,402	)		(2,520	)		(10,672	)

Provision for income tax		—			—			—			—

Net income (loss)	$	90		$	(2,402	)	$	(2,520	)	$	(10,672	)

Net income (loss) per share-basic	$	0.03		$	(0.71	)	$	(0.74	)	$	(3.16	)
Net income (loss) per share-diluted	$	0.03		$	(0.71	)	$	(0.74	)	$	(3.16	)
Weighted average shares outstanding-basic		3,411,813			3,390,097			3,404,395			3,377,911
Weighted average shares outstanding-diluted		3,445,022			3,390,097			3,404,395			3,377,911

See Accompanying Notes to Condensed Consolidated Financial Statements.

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BK TECHNOLOGIES CORPORATION

Condensed Consolidated Statements of Cash Flows

(In thousands) (Unaudited)

	Nine Months Ended September 30,
	2023			2022
Operating activities
Net loss	$	(2,520	)	$	(10,672	)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Inventories allowances		(61	)		48
Amortization of deferred finance and other assets		113			—
Depreciation and amortization		1,218			1,061
Share-based compensation expense-stock options		163			205
Share-based compensation expense-restricted stock units		773			367
Loss on investments		831			1,021
Changes in operating assets and liabilities:
Trade accounts receivable		1,506			2,850
Inventories		593			(9,402	)
Prepaid expenses and other current assets		(385	)		(77	)
Other assets		(277	)		(46	)
ROU assets and lease liabilities		(38	)		(27	)
Accounts payable		(1,135	)		7,374
Accrued compensation and related taxes		412			362
Accrued warranty expense		145			54
Deferred revenue		2,660			190
Accrued other expenses and other current liabilities		(58	)		(166	)
Net cash provided by (used in) operating activities		3,940			(6,858	)

Investing activities
Purchases of property, plant, and equipment		(1,835	)		(959	)
Net cash used in investing activities		(1,835	)		(959	)

Financing activities
Proceeds from common stock issuance		63			—
Cash dividends paid		—			(1,519	)
Proceeds from the credit facility and notes payable		58,896			2,988
Repayment of the credit facility and notes payable		(58,916	)		(198	)
Net cash provided by financing activities		43			1,271

Net change in cash and cash equivalents		2,148			(6,546	)
Cash and cash equivalents, beginning of period		1,918			10,580
Cash and cash equivalents, end of period	$	4,066		$	4,034

Supplemental disclosure
Cash paid for interest	$	487		$	93
Non-cash financing activity
Common stock issued under restricted stock units	$	556		$	364

See Accompanying Notes to Condensed Consolidated Financial Statements.

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BK TECHNOLOGIES CORPORATION

Notes to Condensed Consolidated Financial Statements

Three and Nine Months Ended September 30, 2023, and 2022

Unaudited

(In thousands, except share and per share data and percentages or as otherwise noted)

1. Condensed Consolidated Financial Statements

Basis of Presentation

The condensed consolidated balance sheet as of September 30, 2023, the condensed consolidated statements of operations for the three and nine months ended September 30, 2023, and 2022, and the condensed consolidated statements of cash flows for the three and nine months ended September 30, 2023, and 2022, have been prepared by BK Technologies Corporation (the “Company,” “we,” “us,” “our”), and are unaudited. The condensed consolidated balance sheet as of December 31, 2022, has been derived from the Company’s audited consolidated financial statements at that date.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022, as filed with the Securities and Exchange Commission (“SEC”) on March 16, 2023. The results of operations for the three and nine months ended September 30, 2023, and 2022, are not necessarily indicative of the operating results for a full year.

Principles of Consolidation

The accounts of the Company and its subsidiaries have been included in the accompanying condensed consolidated financial statements. All significant intercompany balances and transactions have been eliminated in consolidation.

The Company consolidates entities in which it has a controlling financial interest. The Company determines whether it has a controlling financial interest in an entity by first evaluating whether the entity is a variable interest entity (“VIE”) or a voting interest entity.

VIEs are entities in which (i) the total equity investment at risk is not sufficient to enable the entity to finance its activities independently, or (ii) the at-risk equity holders do not have the normal characteristics of a controlling financial interest. A controlling financial interest in a VIE is present when an enterprise has one or more variable interests that have both (i) the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance, and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. The enterprise with a controlling financial interest is the primary beneficiary and consolidates the VIE.

Voting interest entities lack one or more of the characteristics of a VIE. The usual condition for a controlling financial interest is ownership of a majority voting interest for a corporation or a majority of kick-out or participating rights for a limited partnership.

When the Company does not have a controlling financial interest in an entity but exerts significant influence over the entity’s operating and financial policies (generally defined as owning a voting or economic interest of between 20% to 50%), the Company’s investment is accounted for under the equity method of accounting. If the Company does not have a controlling financial interest in, or exert significant influence over, an entity, the Company accounts for its investment at fair value, if the fair value option was elected or at cost.

Through September 30, 2022, the Company was the sole limited partner in FGI 1347 Holdings, LP (“1347 LP”), a consolidated VIE. The Company ceased to be the limited partner of 1347 LP as of September 30, 2022.

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Fair Value of Financial Instruments

The Company’s financial instruments consist of cash and cash equivalents, trade accounts receivable, investments, accounts payable, accrued expenses, notes payable, credit facilities, and other liabilities. As of September 30, 2023, and December 31, 2022, the carrying amount of cash and cash equivalents, trade accounts receivable, accounts payable, accrued expenses, notes payable, credit facilities, and other liabilities approximated their respective fair value due to the short-term nature and maturity of these instruments.

Prior to September 14, 2022, the Company held an investment in the common stock of FG Financial Group, Inc. (Nasdaq: FGF) (“FGF”), which investment was held by the Company in 1347 LP. The Company used observable market data assumptions (Level 1 inputs, as defined in accounting guidance) that it believes market participants would use in pricing its investment in FGF.

Effective September 14, 2022, the Company has an investment in Series B common membership interests of FG Financial Holdings, LLC (“FG Holdings LLC”). As further discussed in Note 6, the Company records the investment according to guidance provided by ASC 820 “Fair Value Measurement”, as the Company does not have a controlling financial interest in, nor exerts significant influence over the activities of FG Holdings LLC. The investment in Series B common membership interests of FG Holdings LLC is reported using net asset value (“NAV”) of interests held by the Company at period-end. The NAV is calculated using the observable fair value of the underlying stock of FGF held by FG Holdings LLC, plus uninvested cash, less liabilities, further adjusted through allocations based on distribution preferences, as defined in operating agreement of FG Holdings LLC. The NAV is used as a practical expedient and has not been classified within the fair value hierarchy.

Liquidity

The Company incurred operating losses during 2023 and 2022 and reported negative cash flows from operations during 2022. The Company’s operating results have been negatively impacted by the worldwide shortages of materials, in particular semiconductors and integrated circuits, extended lead times, and increased costs and inventory levels for certain components.

On November 22, 2022, the Company’s subsidiaries, BK Technologies, Inc. and RELM Communications, Inc. (the “Subsidiaries”), entered into an Invoice Purchase and Security Agreement (“IPSA”) with Alterna Capital Solutions, LLC (“Alterna”), providing for a one-year line of credit with total maximum funding up to $15 million (the “Line of Credit”). The Company used funds obtained from the Line of Credit to replace the JPMC Credit Agreement (defined below) (see Note 11).

Management believes that cash and cash equivalents currently available, combined with anticipated cash to be generated from operations, and borrowing ability are sufficient to meet the Company’s working capital requirements in the foreseeable future. The Company generally relies on cash from operations, commercial debt, and equity offerings to the extent available, to satisfy its liquidity needs and to meet its payment obligations. The Company may engage in public or private offerings of equity or debt securities to maintain or increase its liquidity and capital resources. However, financial and economic conditions, including those resulting from the current inflationary environment and current geopolitical tension, could impact our ability to raise capital or debt financing, if needed, on acceptable terms or at all.

Reverse Stock Split

On March 23, 2023, the board of directors (the “Board”) of the Company approved a one (1)-for-five (5) reverse stock split (the “Reverse Stock Split”) of the Company’s issued and outstanding shares of common stock, par value $0.60 per share (the “Common Stock”), and on April 4, 2023, the Company filed with the Secretary of State of the State of Nevada a Certificate of Change to its Articles of Incorporation to effect the Reverse Stock Split.

The Company executed the Reverse Stock Split, which became effective at 5:00 p.m. Eastern Time on April 21, 2023. Shares of Common Stock underlying outstanding stock options and restricted stock units were proportionately reduced, and the respective exercise prices were proportionately increased in accordance with the terms of the agreements governing such securities. Accordingly, all shares and per share amounts for all periods presented in the accompanying condensed consolidated financial statements and notes thereto have been retroactively adjusted, where applicable, to reflect the Reverse Stock Split.

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Recent Accounting Pronouncements

The Company does not discuss recent pronouncements that are not anticipated to have a material impact on or are unrelated to its financial condition, results of operations, cash flows or disclosures.

2. Significant Events and Transactions

On January 31, 2023, the Company entered into a sales agreement (the “Sales Agreement”) with ThinkEquity LLC (the “Sales Agent”), relating to the sale of shares of our Common Stock. In accordance with the terms of the Sales Agreement, we may offer and sell shares of our Common Stock from time to time up to an aggregate offering price of $15,000,000 through or to the Sales Agent, acting as sales agent or principal. After adjusting for the Reverse Stock Split, the number of shares issuable under the terms of the Sales Agreement is 845,070 shares of our Common Stock. The Company intends to use the net proceeds from the offering primarily for general corporate purposes, which may include working capital, capital expenditures, operational purposes, strategic investments and potential acquisitions in complementary businesses.

3. Allowance for Doubtful Accounts

The allowance for doubtful accounts on trade receivables was approximately $50 on gross trade receivables of $9,160 and $10,666 as of September 30, 2023, and December 31, 2022, respectively. This allowance is used to state trade receivables at a net realizable value or the amount that the Company estimates will be collected of the Company’s gross trade receivables.

4. Inventories, Net

Inventories, which are presented net of allowance for slow moving, excess, and obsolete inventory, consisted of the following:

	September 30, 2023		December 31, 2022
Finished goods	$	4,271	$	2,965
Work in process		7,042		7,313
Raw materials		10,260		11,827
	$	21,573	$	22,105

Allowances for slow-moving, excess, or obsolete inventory are used to state the Company’s inventories at the lower of cost or net realizable value. The allowances were approximately $1,186 as of September 30, 2023, compared with approximately $1,247 as of December 31, 2022.

5. Income Taxes

The Company has recorded no tax expense or benefit for the three and nine months ended September 30, 2023 and 2022.

The Company’s income tax provision is based on management’s estimate of the effective tax rate for the full year. The tax provision (benefit) in any period will be affected by, among other things, permanent, as well as temporary, differences in the deductibility of certain items, changes in the valuation allowance related to net deferred tax assets, in addition to changes in tax legislation. As a result, the Company may experience significant fluctuations in the effective book tax rate (that is, tax expense divided by pre-tax book income) from period to period.

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As of September 30, 2023, the Company’s net deferred tax assets totaled approximately $4,116 and were primarily derived from research and development tax credits, deferred revenue, and net operating loss carryforwards.

In order to fully utilize the net deferred tax assets, the Company will need to generate sufficient taxable income in future years. The Company analyzed all positive and negative evidence to determine if, based on the weight of available evidence, it is more likely than not to realize the benefit of the net deferred tax assets. The recognition of the net deferred tax assets and related tax benefits is based upon the Company’s conclusions regarding, among other considerations, estimates of future earnings based on information currently available and current and anticipated customers, contracts, and product introductions, as well as historical operating results and certain tax planning strategies.

Based on the analysis of all available evidence, both positive and negative, the Company has concluded that it does not have the ability to generate sufficient taxable income in the necessary period to utilize the entire benefit for the deferred tax assets. Accordingly, the Company established a valuation allowance of $4,212 and $3,356 as of September 30, 2023, and December 31, 2022, respectively. The Company cannot presently estimate what, if any, changes to the valuation of its deferred tax assets may be deemed appropriate in the future. If the Company incurs future losses, it may be necessary to record additional valuation allowance related to the deferred tax assets recognized as of September 30, 2023.

6. Investments

Through September 30, 2022, the Company was the sole limited partner of 1347 LP. Affiliates of Fundamental Global GP, LLC, (“FG”), a significant stockholder of the Company, served as the general partner and investment manager of 1347 LP. 1347 LP was established for the purpose of investing in securities, and its sole asset was shares of common stock of FGF. These shares were purchased in March and May 2018 for approximately $3,741.

On September 14, 2022, FG contributed all of the shares of common stock of FGF held by 1347 LP to Holdings LLC, with an approximate value of $945, based on the published price of FGF stock at the time of contribution, in exchange for Series B common membership interests of FG Holdings LLC, with an equivalent value.

The investment in the Series B common membership interests of FG Holdings LLC is measured using the NAV practical expedient in accordance with ASC 820 Fair Value Measurement and has not been classified within the fair value hierarchy. FG Holdings LLC invests in the common and preferred stock of FGF. FG Holdings LLC’s structure provides for Series A preferred interests, which accrue a return of eight percent per annum and receive 20% of positive profits with respect to the total return in the capital provided by the holders of Series A preferred membership interests. The Series B common membership interests receive cumulative distributions equal to the aggregate capital contributions by the Series B common membership interest equal to the total return on capital provided by the Series B common membership interests. Series B common membership interests also receive an additional return equal to 1.5 times the Series A of positive profits described above. There is no defined redemption frequency, and the Company cannot redeem or transfer its investment without the prior written consent of FG Holdings LLC' managers, who are FG affiliates. Distributions may be made to members at such times and amounts as determined by the managers, and shall be based on the most recent NAV. The Company does not have any unfunded commitments related to this investment.

As of September 30, 2023, the members and affiliates of FG Holdings LLC beneficially owned in the aggregate 5,666,111 shares of FGF’s common stock, representing approximately 55% of FGF’s outstanding shares. Additionally, FG and its affiliates constitute the largest stockholder of the Company. Mr. Kyle Cerminara, Chairman of the Board, is Chief Executive Officer, Co-Founder and Partner of FG and serves as chairman of the board of directors of FG Group Holdings Inc., the entity that is a manager and majority Series B member in FG Holdings LLC. Mr. Cerminara also serves as chairman of the board of directors of FGF.

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7. Stockholders’ Equity

Effective on April 21, 2023, the Company filed a Certificate of Change to the Articles of Incorporation to effect the Reverse Stock Split (see Note 1). All share and per share information in this Quarterly Report on Form 10-Q have been retroactively adjusted to reflect the Reverse Stock Split. As of November 6, 2023, there were 3,745,579 shares of common stock issued and 3,455,499 outstanding, and no shares of preferred stock outstanding.

The changes in condensed consolidated stockholders’ equity for the three and nine months ended September 30, 2023, and 2022, are as follows:

	Common Stock Shares		Common Stock Amount		Additional Paid-In Capital			Accumulated Deficit			Treasury Stock			Total
Balance as of December 31, 2022		3,686,939	$	2,212	$	45,304		$	(21,979	)	$	(5,402	)	$	20,135
Common stock issued		858		1		14			—			—			15
Common stock issued under restricted stock units		1,920		1		(1	)		—			—			—
Share-based compensation expense-stock options		—		—		58			—			—			58
Share-based compensation expense-restricted stock units		—		—		69			—			—			69
Net loss		—		—		—			(1,270	)		—			(1,270	)
Balance as of March 31, 2023		3,689,717		2,214		45,444			(23,249	)		(5,402	)		19,007

Common stock issued		2,661		2		33			—			—			35
Common stock issued under restricted stock units		1,920		1		(1	)		—			—			—
Share-based compensation expense-stock options		—		—		61			—			—			61
Share-based compensation expense-restricted stock units		—		—		63			—			—			63
Net loss		—		—		—			(1,340	)		—			(1,340	)
Balance as of June 30, 2023		3,694,298		2,217		45,600			(24,589	)		(5,402	)		17,826
Common stock issued		1,254		1		12			—			—			13
Common stock issued under restricted stock units		27,418		16		(16	)		—			—			—
Share-based compensation expense-stock options		—		—		44			—			—			44
Share-based compensation expense-restricted stock units		—		—		641			—			—			641
Net income		—		—		—			90			—			90
Balance as of September 30, 2023		3,722,970	$	2,234	$	46,281		$	(24,499	)	$	(5,402	)	$	18,614

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	Common Stock Shares		Common Stock Amount		Additional Paid-In Capital			Accumulated Deficit			Treasury Stock			Total
Balance as of December 31, 2021		3,659,800	$	2,196	$	44,645		$	(8,821	)	$	(5,402	)	$	32,618
Common stock issued under restricted stock units		3,200		2		(2	)		—			—			—
Share-based compensation expense-stock options		—		—		85			—			—			85
Share-based compensation expense-restricted stock units		—		—		70			—			—			70
Net loss		—		—		—			(3,936	)		—			(3,936	)
Balance as of March 31, 2022		3,663,000		2,198		44,798			(12,757	)		(5,402	)		28,837
Common stock issued under restricted stock units		10,773		6		(6	)		—			—			—
Share-based compensation expense-stock options		—		—		51			—			—			51
Share-based compensation expense-restricted stock units		—		—		171			—			—			171
Common stock dividends ($0.03 per share)		—		—		—			(1,014	)		—			(1,015	)
Net loss		—		—		—			(4,334	)		—			(4,334	)
Balance as of June 30, 2022		3,673,773		2,204		45,014			(18,105	)		(5,402	)		23,711
Common stock issued under restricted stock units		13,166		8		(8	)		—			—			—
Share-based compensation expense-stock options		—		—		69			—			—			69
Share-based compensation expense-restricted stock units		—		—		126			—			—			126
Common stock dividends ($0.03 per share)		—		—		—			(511	)		—			(511	)
Net loss		—		—		—			(2,402	)		—			(2,402	)
Balance as of September 30, 2022		3,686,939	$	2,212	$	45,201		$	(21,018	)	$	(5,402	)	$	20,993

8. Income (Loss) Per Share

The following table sets forth the computation of basic and diluted income (loss) per share:

	Three Months Ended September 30,					Nine Months Ended September 30,
	2023		2022			2023			2022
Numerator:
Net income (loss) for basic and diluted earnings per share	$	90	$	(2,402	)	$	(2,520	)	$	(10,672	)
Denominator for basic income (loss) per share weighted average shares		3,411,813		3,390,097			3,404,395			3,377,911
Effect of dilutive securities:
Options and restricted stock units		33,209		—			—			—
Denominator for diluted loss per share weighted average shares		3,445,022		3,390,097			3,404,395			3,377,911
Basic income (loss) per share	$	0.03	$	(0.71	)	$	(0.74	)	$	(3.16	)
Diluted income (loss) per share	$	0.03	$	(0.71	)	$	(0.74	)	$	(3.16	)

Approximately 168,600 and 224,600 stock options and 28,569 and 29,381 restricted stock units for the three and nine months ended September 30, 2023, respectively, and 220,300 stock options and 41,129 restricted stock units for the three and nine months ended September 30, 2022, were excluded from the calculation because they were anti-dilutive.

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9. Non-Cash Share-Based Employee Compensation

Stock Options

The Company has an employee and non-employee director share-based incentive compensation plans. Related to these programs, the Company recorded non-cash share-based employee compensation expense of $44 and $163 for the three and nine months ended September 30, 2023, respectively, compared with $69 and $205, for the same periods last year. The Company considers its non-cash share-based employee compensation expenses as a component of cost of products and selling, general and administrative expenses. There was no non-cash share-based employee compensation expense capitalized as part of capital expenditures or inventory for the periods presented.

The Company uses the Black-Scholes-Merton option valuation model to calculate the fair value of stock option grants under this plan. The non-cash share-based employee compensation expense recorded in the three and nine months ended September 30, 2023, was calculated using certain assumptions. Such assumptions are described more comprehensively in Note 10 (Share-Based Employee Compensation) of the Notes to the Company’s consolidated financial statements included in its Annual Report on Form 10-K for the fiscal year ended December 31, 2022.

A summary of activity under the Company’s stock option plans during the nine months ended September 30, 2023, is presented below:

	Stock Options		Wgt. Avg. Exercise Price ($) Per Share		Wgt. Avg. Remaining Contractual Life (Years)		Wgt. Avg. Grant Date Fair Value ($) Per Share		Aggregate Intrinsic Value ($)
As of January 1, 2023
Outstanding		200,300		15.48		7.87		5.64		460,925
Vested		86,846		17.83		6.73		6.57		101,090
Nonvested		113,454		13.68		8.74		4.93		359,835

Period activity
Issued		28,600		11.51		—		6.57		—
Exercised		—		—		—		—		—
Forfeited		2,300		13.58		—		4.97		—
Expired		2,000		11.15		—		7.02		—

As of September 30, 2023
Outstanding		224,600		15.03		7.49		5.75		60,410
Vested		135,913		16.27		6.87		5.89		19,789
Nonvested		88,687		13.13		8.45		5.54		40,621

Restricted Stock Units

The Company recorded non-cash restricted stock unit compensation expense of $641 and $773 for the three and nine months ended September 30, 2023, compared with $126 and $367 for the same periods last year.

A summary of non-vested restricted stock under the Company’s non-employee director share-based incentive compensation plan is as follows:

	Number of Shares		Weighted Average Grant Date Price per Share
Unvested as of January 1, 2023		41,129	$	13.20
Granted		45,412		12.37
Vested and issued		25,497		13.18
Vested-to be issued		31,663		11.87
Cancelled/forfeited		-		-
Unvested as of September 30, 2023		29,381	$	13.37

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10. Commitments and Contingencies

Legal Matters

From time to time, the Company may be involved in various claims and legal actions arising in the ordinary course of its business. On a quarterly basis, the Company assesses its liabilities and contingencies in connection with outstanding legal proceedings utilizing the latest information available. Where it is probable that the Company will incur a loss and the amount of the loss can be reasonably estimated, it records a liability in its consolidated financial statements. These legal accruals may be increased or decreased to reflect any relevant developments on a quarterly basis. Where a loss is not probable or the amount of the loss is not estimable, the Company does not accrue legal reserves, consistent with applicable accounting guidance. There were no pending material claims or legal matters as of September 30, 2023.

Purchase Commitments

As of September 30, 2023, the Company had purchase commitments for inventory totaling approximately $13,134.

Significant Customers

Sales to United States government agencies represented approximately $12,142 (60.5%) and $29,571 (51.2%) of the Company’s net total sales for the three and nine months ended September 30, 2023, respectively, compared with approximately $4,196 (35.2%) and $11,161 (36.4%), for the same periods last year. Accounts receivable from agencies of the United States government were $4,280 as of September 30, 2023, compared with approximately $1,545 at the same date last year.

11. Debt

Credit Facilities

On November 22, 2022, the Subsidiaries entered into the IPSA with Alterna. On November 28, 2022, the Subsidiaries and Alterna entered into a rider to the IPSA, to modify the IPSA to, among other things, provide a credit facility for up to 75% of net orderly liquidation value of inventory, not to exceed 100% of the eligible accounts receivable balance. The IPSA, which provides for a one-year Line of Credit with a maximum capacity of up to $15 million, is scheduled to be renewed in November 2023, unless canceled by either party, as provided in the agreement. The Line of Credit bears an interest rate of Prime plus 1.85%. The effective borrowing rate under the IPSA was 10.35% as of September 30, 2023. Interest and related servicing fees for the three months and nine months ended September 30, 2023, were approximately $153 and $476, respectively. Under the arrangement, the Company may transfer eligible short-term trade receivables to the conduit, with full recourse, on a daily basis in exchange for cash. Generally, at the transfer date, the Company may receive cash equal to approximately 85% of the value of the transferred receivables. The Company accounts for the transfers of receivables as a secured borrowing due to the Company’s continuing involvement with the accounts receivable.

The Company used approximately $4.5 million of IPSA funding to repay the outstanding balance of the credit facility with JP Morgan Chase Bank, N.A. (“JPMC”), which subsequently expired on January 31, 2023.

During the three and nine months ended September 30, 2023, the Company transferred receivables having an aggregate face value of $17.5 and $52.5 million, respectively, to the conduit and received proceeds of $18.2 and $58.9 million, respectively, which also include draws on available inventory funding. There were no losses incurred on these transfers during the three and nine months ended September 30, 2023.

As of September 30, 2023, the outstanding borrowings under the IPSA were approximately $6.5 million and the outstanding principal amount of receivables transferred under the IPSA amounted to $7.0 million.

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Notes Payable

On April 6, 2021, BK Technologies, Inc., a wholly owned subsidiary of the Company, and JPMC, as a lender, entered into a Master Loan Agreement in the amount of $743 to finance various items of manufacturing equipment (the “JPMC Credit Agreement”). The Company used funds obtained from the Line of Credit to replace the JPMC Credit Agreement. This note payable was paid in full on June 27, 2023.

On September 25, 2019, BK Technologies, Inc., a wholly owned subsidiary of the Company, and U.S. Bank Equipment Finance, a division of U.S. Bank National Association, as a lender, entered into a Master Loan Agreement in the amount of $425 to finance various items of manufacturing equipment. The loan is collateralized by the equipment purchased using the proceeds. The Master Loan Agreement is payable in 60 equal monthly principal and interest payments of approximately $8 beginning on October 25, 2019, matures on September 25, 2024, and bears a fixed interest rate of 5.11%.

The following table summarizes the notes payable principal repayments subsequent to September 30, 2023:

	September 30, 2023
Remaining three months of 2023	$	23
2024		71
Thereafter		—
Total payments	$	94

12. Leases

The Company accounts for its leasing arrangements in accordance with Topic 842, “Leases”. The Company leases manufacturing and office facilities and equipment under operating leases and determines if an arrangement is a lease at inception. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent its obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term.

As most of its leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. The Company has lease agreements with lease and non-lease components, which are accounted for separately.

The Company leases approximately 54,000 square feet (not in thousands) of industrial space in West Melbourne, Florida, under a non-cancellable operating lease. The lease has the expiration date of September 30, 2027. Annual rental, maintenance and tax expenses for the facility are approximately $491.

In February 2020, the Company entered into a lease for 6,857 square feet (not in thousands) of office space at Sawgrass Technology Park, 1619 NW 136th Avenue in Sunrise, Florida, for a period of 64 months commencing July 1, 2020. Annual rental, maintenance and tax expenses for the facility will be approximately $196 for the first year, increasing by approximately 3% for each subsequent 12-month period.

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Lease costs consisted of the following:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		, 2022
Operating lease cost	$	135	$	136	$	407	$	408
Short-term lease cost		—		—		—		—
Variable lease cost		33		33		99		99
Total lease cost	$	168	$	169	$	506	$	507

Supplemental cash flow information related to leases was as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows (fixed payments)	$	149	$	147	$	445	$	435
Operating cash flows (liability reduction)	$	123	$	114	$	360	$	331

ROU assets obtained in exchange for lease obligations:
Operating leases	$	—	$	—	$	—	$	—

Other information related to operating leases was as follows:

September 30,

2023

Weighted average remaining lease term (in years)

3.50

Weighted average discount rate

5.50

Maturity of lease liabilities as of September 30, 2023, were as follows:

	September 30, 2023
Remaining three months of 2023	$	150
2024		608
2025		618
2026		479
2027		242
Thereafter		—
Total payments		2,097
Less: imputed interest		(187	)
Total present value of lease liability	$	1,910

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13. Subsequent Events

On October 12, 2023, the Company’s President, Timothy A. Vitou, retired. In connection with Mr. Vitou’s retirement, the Company and Mr. Vitou entered into a Separation Agreement and General Release (“Separation Agreement”). Pursuant to the Separation Agreement, the Company will pay to Mr. Vitou $283,250, which amounts to twelve months of compensation at Mr. Vitou’s current normal base pay rate, less taxes, social security and other required withholdings, to be paid in bi-weekly increments in accordance with the Company’s regular payroll practices. Pursuant to the Separation Agreement, Mr. Vitou granted a general release to the Company from any and all claims (known or unknown), rights, or demands that Mr. Vitou has or may have against the Company and other released parties described in the Separation Agreement.

On October 13, 2023, the Company granted 1,920 restricted stock units to Joshua Horowitz, third party, for strategic advisory service compensation. These restricted stock units were fully vested and settled on the date of grant.

On November 6, 2023, the Company entered into a Master Service Agreement (the “EW MSA”) with East West Manufacturing, LLC, a Georgia limited liability company (“EW”), for the manufacturing production of certain land mobile radio (“LMR”) products and accessories. In connection with the EW MSA, the Company and EW also entered into a Transition Services Agreement to govern the transition of manufacturing production to EW. Also in connection with the EW MSA, the Company and EW entered into a Stock Purchase Agreement, pursuant to which EW purchased 77,520 shares of Common Stock with a value equal to $1,000,000. The number of shares of stock was determined based upon a price per share of $12.90, which is equal to the average of the closing price of the Common Stock on the NYSE American exchange for the 30 most recent trading days prior to November 6, 2023, rounded up to the nearest whole number of shares. Additionally, EW purchased a warrant (“Warrant”), with a five-year term to purchase up to 135,300 shares of Common Stock at an exercise price per share of $15.00.

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Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

SPECIAL NOTE CONCERNING

FORWARD-LOOKING STATEMENTS

We believe that it is important to communicate our future expectations to our security holders and to the public. This report, including any information incorporated by reference in this report, therefore, contains statements about future events and expectations which are “forward-looking statements” within the meaning of Sections 27A of the Securities Act of 1933, as amended, and 21E of the Exchange Act, including the statements about our plans, objectives, expectations and prospects under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” You can expect to identify these statements by forward-looking words such as “may,” “might,” “could,” “would,” “should,” “will,” “anticipate,” “believe,” “plan,” “estimate,” “project,” “expect,” “intend,” “seek,” “are encouraged” and other similar expressions. Any statement contained in this report that is not a statement of historical fact may be deemed to be a forward-looking statement. We also may make forward-looking statements in other documents that are filed or furnished with the SEC. In addition, we may make forward-looking statements orally or in writing to investors, analysts, members of the media, or others. Forward-looking statements include, but are not limited to, the following: changes or advances in technology; the success of our SaaS and Radio business lines and the products offered thereunder; successful introduction of new products and technologies, including our ability to successfully develop and sell our anticipated SaaS products, and our new multiband radio product and other related products in the planned new BKR Series product line; competition in the LMR industry; general economic and business conditions, including federal, state and local government budget deficits and spending limitations and any impact from a prolonged shutdown of the U.S. Government; the availability, terms and deployment of capital; reliance on contract manufacturers and suppliers; risks associated with fixed-price contacts; heavy reliance on sales to agencies of the U.S. Government and our ability to comply with the requirements of contracts, laws and regulations related to such sales; allocations by government agencies among multiple approved suppliers under existing agreements; our ability to comply with U.S. tax laws and utilize deferred tax assets; our ability to attract and retain executive officers, skilled workers and key personnel; our ability to manage our growth; our ability to identify potential candidates for, and consummate, acquisition, disposition or investment transactions, and risks incumbent to being a noncontrolling interest stockholder in a corporation; impact of our capital allocation strategy; risks related to maintaining our brand and reputation; impact of government regulation; rising health care costs; our business with manufacturers located in other countries, including changes in the U.S. Government and foreign governments’ trade and tariff policies; our inventory and debt levels; protection of our intellectual property rights; fluctuation in our operating results and stock price; acts of war or terrorism, natural disasters and other catastrophic events; any infringement claims; data security breaches, cyber-attacks and other factors impacting our technology systems; availability of adequate insurance coverage; maintenance of our NYSE American listing; risks related to being a holding company; and the effect on our stock price and ability to raise equity capital of future sales of shares of our common stock.

Although we believe that the plans, objectives, expectations and prospects reflected in or suggested by our forward-looking statements are reasonable, those statements involve risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements, and we can give no assurance that our plans, objectives, expectations and prospects will be achieved. Any forward-looking statement made by us or on our behalf speaks only as of the date that it was made. We do not undertake to update any forward-looking statement to reflect the impact of events, circumstances, or results that arise after the date that the statement was made, except as required by applicable securities laws. You, however, should consult further disclosures (including disclosures of a forward-looking nature) that we may make in any subsequent Annual Report on Form 10-K, Quarterly Report on Form 10-Q, or Current Report on Form 8-K.

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Important factors that might cause our actual results to differ materially from the results contemplated by the forward-looking statements are contained in the “Risk Factors” section of, and elsewhere in, our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, and in our subsequent filings with the SEC, and include, among others, the following:

	·	changes or advances in technology;

	·	the success of our LMR product line;

	·	successful introduction of new products and technologies, including our ability to successfully develop and sell our new multiband product and other related products in the planned new BKR Series product line and our SaaS solution;

	·	competition in the LMR industry;

	·	general economic and business conditions, including federal, state and local government budget deficits and spending limitations, any impact from a prolonged shutdown of the U.S. Government, and the ongoing effects of inflation, rising interest rates, bank failures, supply-chain constraints, ongoing geopolitical conflicts and related sanctions;

	·	the availability, terms and deployment of capital;

	·	reliance on contract manufacturers and suppliers;

	·	risks associated with fixed-price contracts;

	·	heavy reliance on sales to agencies of the U.S. Government and our ability to comply with the requirements of contracts, laws and regulations related to such sales;

	·	allocations by government agencies among multiple approved suppliers under existing agreements;

	·	our ability to comply with U.S. tax laws and utilize deferred tax assets;

	·	our ability to attract and retain executive officers, skilled workers and key personnel;

	·	our ability to manage our growth;

	·	our ability to identify potential candidates and consummate acquisition, disposition or investment transactions, and risks incumbent to being a noncontrolling interest stockholder in a corporation;

	·	the impact of general business conditions, including those resulting from inflation, rising interest rates, bank failures, ongoing geopolitical conflicts and related sanctions, on the companies in which we hold investments;

	·	impact of our capital allocation strategy;

	·	risks related to maintaining our brand and reputation;

	·	impact of government regulation;

	·	rising health care costs;

	·	our business with manufacturers located in other countries, including changes in the U.S. Government and foreign governments’ trade and tariff policies, as well as any further impact resulting from inflation, rising interest rates, bank failures, ongoing geopolitical conflicts and related sanctions;

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	·	our inventory and debt levels;

	·	protection of our intellectual property rights;

	·	fluctuation in our operating results and stock price;

	·	acts of war or terrorism, natural disasters, public health crises, and other catastrophic events;

	·	any infringement claims;

	·	data security breaches, cyber-attacks and other factors impacting our technology systems;

	·	availability of adequate insurance coverage;

	·	maintenance of our NYSE American listing;

	·	risks related to being a holding company; and

	·	the effect on our stock price and ability to raise equity capital through future sales of shares of our common stock.

Some of these factors and risks have been, and may further be, exacerbated by general economic conditions, including the ongoing military conflict in Ukraine, such as inflationary pressures and disruptions in the global supply chain. We assume no obligation to publicly update or revise any forward-looking statements made in this report, whether as a result of new information, future events, changes in assumptions or otherwise, after the date of this report. Readers are cautioned not to place undue reliance on these forward-looking statements.

Reported dollar amounts in the management’s discussion and analysis (“MD&A”) section of this report are disclosed in millions or as whole dollar amounts.

The following discussion and analysis should be read in conjunction with our condensed consolidated financial statements and notes thereto appearing elsewhere in this report and the MD&A, consolidated financial statements and notes thereto appearing in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on March 16, 2023.

Executive Summary

BK Technologies Corporation (NYSE American: BKTI) (together with its wholly owned subsidiaries, “BK,” the “Company,” “we” or “us”) is a holding company that, through BK Technologies, Inc., its operating subsidiary, provides public safety grade communications products and services which make first responders safer and more efficient. All operating activities described herein are undertaken by our operating subsidiary.

In business for over 70 years, BK operates two business units through its operating subsidiary, BK Technologies, Inc.: Radio and SaaS.

The Radio business unit designs, manufactures and markets American-made wireless communications products consisting of two-way LMRs. Two-way LMRs can be radios that are hand-held (portable) or installed in vehicles (mobile).

Generally, BK Technologies-branded products serve the government markets, including but not limited to, emergency response, public safety, homeland security and military customers of federal, state and municipal government agencies, as well as various industrial and commercial enterprises. We believe that our products and solutions provide superior value by offering a high specification, ruggedized, durable, reliable, feature rich, Project 25-compliant radio at a lower cost relative to comparable offerings.

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The SaaS business unit focuses on delivering innovative, public safety smartphone applications that operate ubiquitously over public cellular networks. Our BKRplay branded smartphone application will offer multiple services that make first responders safer and more efficient. When tethered to our radios, the combined solution will offer a unique capability which increases the sales reach of our radios.

We were incorporated under the laws of the State of Nevada on October 24, 1997. We are the corporation resulting from the reincorporation merger of our predecessor, Adage, Inc., a Pennsylvania corporation, which reincorporated from Pennsylvania to Nevada effective as of January 30, 1998. Effective on June 4, 2018, we changed our corporate name from “RELM Wireless Corporation” to “BK Technologies, Inc.”

Our principal executive offices are located at 7100 Technology Drive, West Melbourne, Florida 32904 and our telephone number is (321) 984-1414.

Customer demand and orders for our products were strong during 2022. Supply chain constraints limited our ability to manufacture the quantities needed to ship and fulfill all the orders during 2022. Consequently, approximately 13,000 radio units were carried in backlog as of December 31, 2022, and we fulfilled approximately 83% of these radio units during the first nine months of 2023.

Our backlog of unshipped customer orders was approximately $21.8 million and $27.0 million as of September 30, 2023, and December 31, 2022, respectively. Changes in the backlog are attributed primarily to the timing of orders and their fulfillment.

For the three months ended September 30, 2023, sales grew approximately 68.4% to approximately $20.1 million, compared with $11.9 million for the prior year period. The growth was attributed primarily to the BKR 5000 and BKR 9000 products and the fulfillment of the 2022 backlog described above. Gross profit margins as a percentage of sales for the three months ended September 30, 2023, were 31.9%, compared with 18.8% for the prior comparative quarter, generally reflecting higher production volumes and improvement in material, component and freight costs. Selling, general and administrative (“SG&A”) expenses for the three months ended September 30, 2023, totaled approximately $5.8 million (29.0% of sales), compared with $4.6 million (38.9% of sales) in the same period of last year. We recognized operating income for the three months ended September 30, 2023, of approximately $0.6 million, compared with an operating loss of approximately $2.4 million for the same period for the prior year.

For the three months ended September 30, 2023, we recognized other expenses, net totaling approximately $0.5 million, primarily attributed to net unrealized losses from our investment in Holdings LLC. and interest expense on our Line of Credit. This compares with other expenses, net totaling $11,000 for the same period last year, which included an unrealized gain on the investment in FG Holdings LLC that was offset by interest and other expenses.

For the three months ended September 30, 2023, the pretax income totaled approximately $90,000, compared with pretax loss of approximately $2.4 million for same period of the prior year. For the nine months ended September 30, 2023, the pretax loss totaled approximately $2.5 million, compared with pretax loss of approximately $10.7 million for same period of the prior year.

We recognized no tax expense for the three and nine-month periods ended September 30, 2023, and for the same periods of the prior year.

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The net income for the three months ended September 30, 2023, totaled approximately $90,000 ($0.03 per basic and diluted share), compared with a net loss of approximately $2.4million ($0.71 per basic and diluted share) for the same period last year. The primary factors for the improvement for the three months ended September 30, 2023, compared to the same period last year, were higher production volumes and lower raw material and freight costs related to electronic component shortages from supply chain disruptions. The net loss for the nine months ended September 30, 2023, totaled approximately $2.5 million ($0.74 per basic and diluted share), compared with net loss of approximately $10.7 million ($3.16 per basic and diluted share) for the nine-month period last year. The primary factors for the improvement for the nine months ended September 30, 2023, compared to the same period last year were higher production volumes and lower raw material and freight costs.

As of September 30, 2023, working capital totaled approximately $13.8 million, of which $13.2 million was comprised of cash, cash equivalents and trade receivables. This compares with working capital totaling approximately $13.2 million at 2022 year-end, which included $12.5 million of cash, cash equivalents and trade receivables.

Available Information

Our Internet website address is www.bktechnologies.com. We make available on our Internet website, free of charge, our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, proxy statements and amendments to these reports as soon as practicable after we file such material with, or furnish it to, the SEC). In addition, our Code of Business Conduct and Ethics, Code of Ethics for the CEO and Senior Financial Officers, Audit Committee Charter, Compensation Committee Charter, Nominating and Governance Committee Charter and other corporate governance policies are available on our website, under “Investor Relations.” The information contained on our website is not incorporated by reference in this report. A copy of any of these materials may be obtained, free of charge, upon request from our investor relations department by submitting a written request to bktechnologies@imsinvestorrelations.com or calling (203) 972-9200. Additional information regarding our investor relations department can be found on our website. All reports that the Company files with or furnishes to the SEC are also available free of charge via the SEC’s website at http://www.sec.gov.

Third Quarter and Nine Months Summary

We may experience fluctuations in our quarterly results, in part, due to governmental customer spending patterns that are influenced by government fiscal year-end budgets and appropriations. We may also experience fluctuations in our quarterly results, in part, due to our sales to federal and state agencies that participate in wildland fire-suppression efforts, which may be greater during the summer season when forest fire activity is heightened. In some years, these factors may cause an increase in sales for the second and third quarters, compared with the first and fourth quarters of the same fiscal year. Such increases in sales may cause quarterly variances in our cash flow from operations and overall financial condition.

We received record customer orders of approximately $70 million in 2022. Customer demand and orders for our products continued to be strong during the three months ended September 30, 2023. Worldwide shortages of materials, particularly semiconductors and integrated circuits, resulting in part from the impact of COVID-19, have resulted in limited supplies, extended lead times, and increased our costs and inventory levels for certain components used in our products in the year ended December 31, 2022 . While, generally, we have been able to procure the material necessary to manufacture our products and fulfill customer orders, we have experienced some delays and longer delivery times within our supply chain in the year ended December 31, 2022. The impact on our operations of such shortages, or additional shortages that may surface, is uncertain, but could potentially impact our future sales, manufacturing operations and financial results. Continued progression of these circumstances could result in a decline in customer orders, as our customers could shift purchases to lower-priced or other perceived value offerings or reduce their purchases and inventories due to decreased budgets, reduced access to credit or various other factors, and impair our ability to manufacture our products, which could have a material adverse impact on our results of operations and cash flow. These supply chain constraints and material shortages limited our ability to manufacture the quantities needed to ship and fulfill all of the orders that we received in 2022. Consequently, we had approximately 13,000 radio units that were carried in backlog as of December 31, 2022, and we fulfilled approximately 83% of these radio units during the nine months ended September 30, 2023.

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Overall, our revenues for the three months ended September 30, 2023, increased compared with the same period of last year. For the third quarter 2023, sales increased 68.4% to approximately $20.1 million, compared with approximately $11.9 million of sales for the third quarter last year. Sales for the nine months ended September 30, 2023, increased 88.8% compared to the same nine-month period last year. Gross profit margin as a percentage of sales for the third quarter of 2023 was approximately 31.9%, compared with 18.8% for the same period of last year, generally reflecting improvements in increased production volumes and improvements in supply chain material costs and freight compared to the third quarter last year. Gross profit margin as a percentage of sales for the nine months ended September 30, 2023, was approximately 28.6%, compared with 17.8% for the same period of last year, generally reflecting improvements in supply chain material and freight costs and increased production volumes. Selling, general and administrative (“SG&A”) expenses for the third quarter of 2023 totaled approximately $5.8 million, which was 25.5% higher than the SG&A expenses of approximately $4.6 million for the third quarter last year, while SG&A expenses for the nine-month period ended September 30, 2023, increased 18.3% compared to the same period last year. The increase in SG&A expenses is attributed primarily to sales and engineering costs related to the BKR 9000 product introduction. These factors yielded operating income of approximately $0.6 million for the three-month period ended September 30, 2023, compared with an operating loss of approximately $2.4 million for the same quarter last year, which improved primarily due to higher production volumes and reduced supply chain material challenges compared to the same period last year.

For the third quarter of 2023, we recognized a net unrealized loss totaling approximately $0.3 million on our investment in FG Holdings LLC. This compares with net realized and unrealized gains of approximately $0.1 million, for the third quarter of last year. For the nine months ended September 30, 2023, we recognized a net unrealized loss totaling approximately $0.8 million on our investment in FG Holdings LLC. compared with a recognized net realized and unrealized losses of approximately $1.0 million, for last year’s nine-month period.

Net income for the three months ended September 30, 2023, was approximately $90,000 ($0.03 per basic and diluted share), compared with a net loss of approximately $2.4 million ($0.71 per basic and diluted share) for the same quarter last year. For the nine months ended September 30, 2023, our net loss totaled approximately $2.5 million ($0.74 per basic and diluted share), compared with a net loss of approximately $10.7 million ($3.16 per basic and diluted share) for the same period last year.

As of September 30, 2023, working capital totaled approximately $13.8 million, of which approximately $13.2 million was comprised of cash, cash equivalents and trade receivables. As of December 31, 2022, working capital totaled approximately $13.2 million, of which approximately $12.5 million was comprised of cash, cash equivalents and trade receivables.

Results of Operations

As an aid to understanding our operating results for the periods covered by this report, the following table shows selected items from our condensed consolidated statements of operations expressed as a percentage of sales:

	Percentage of Sales Three Months Ended						Percentage of Sales Nine Months Ended
	Sept 30, 2023			Sept 30, 2022			Sept 30, 2023			Sept 30, 2022
Sales		100.0	%		100.0	%		100.0	%		100.0	%
Cost of products		(68.1	)		(81.2	)		(71.4	)		(82.2	)
Gross margin		31.9			18.8			28.6			17.8
Selling, general and administrative expenses		(29.0	)		(38.9	)		(30.6	)		(48.8	)
Other expense, net		(2.5	)		(0.1	)		(2.3	)		(3.8	)
Income (loss) before income taxes		0.4			(20.2	)		(4.3	)		(34.9	)
Income tax (expense) benefit		--			--			--			--
Net income (loss)		0.4	%		(20.2	)%		(4.3	)%		(34.9	)%

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Net Sales

For the third quarter ended September 30, 2023, net sales increased 68.4% to approximately $20.1 million, compared with approximately $11.9 million for the same quarter last year. Sales for the nine months ended September 30, 2023, totaled approximately $57.8 million, compared with approximately $30.6 million for the nine-month period last year.

Customer demand and orders for our products continued to be strong, reflecting the acceptance by the marketplace for our BKR 5000 product. We were able to fulfill approximately 83% of the radio units in backlog as of December 31, 2022, during the first nine months of this year. The supply chain issues experienced in 2022 have diminished significantly, but the precise impact on sales and shipments for the remainder of 2023 cannot be quantified, hence we anticipate maintaining an elevated level of inventory.

Sales for the third quarter ended September 30, 2023, were attributed primarily to federal wildland fire related agencies and certain state and local public safety opportunities. From a product perspective, the primary contributor to orders and shipments during the third quarter was our BKR 5000 portable radio and related accessories. The BKR Series is envisioned as a comprehensive line of new products, which includes new models such as the BKR 9000, which achieved FCC P25 compliance testing and its first sales in the second quarter of 2023. The timing of developing additional BKR Series products and bringing them to market could be impacted by various factors, including potential impacts on our supply chain as a result of various electronic component suppliers. We believe that the BKR Series products should increase our addressable market by expanding the number of federal and other public safety customers that may purchase our products. However, the timing and size of orders from agencies at all levels can be unpredictable and subject to budgets, priorities, and other factors. Accordingly, we cannot assure that sales will occur under particular contracts, or that our sales prospects will otherwise be realized.

While the potential impacts of material shortages, lead-times, the current inflationary environment and ongoing geopolitical conflict and related sanctions in coming months and quarters remain uncertain, such effects have the potential to adversely impact our customers and our supply chain. Such negative effects on our customers and suppliers could adversely affect our future sales, gross profit margins, operations, and financial results.

Cost of Products and Gross Profit Margin

Gross profit margins as a percentage of sales for the third quarter ended September 30, 2023, were approximately 31.9% compared with 18.8% for the same quarter last year. For the nine-month period ended September 30, 2023, gross profit margins were approximately 28.6%, compared with 17.8% for the same period last year.

Our cost of products and gross profit margins are primarily derived from material, labor and overhead costs, product mix, manufacturing volumes and pricing. Gross profit margins for the quarter and nine months ended September 30, 2023, increased compared with the same periods last year, primarily due to improvement in production volumes related to supply shortages, material costs, including electronic components, and to a lesser degree, easing of escalated freight costs.

During the year ended December 31, 2022, worldwide shortages of materials, including semiconductors and integrated circuits resulted in limited supplies, which in turn, extended lead times and resulted in higher costs for certain components used in our products. Accordingly, we experienced delivery delays and increased costs within our supply chain. While the progression and duration of these shortages is not known with certainty, we monitored a number of critical components for product cost improvement and have experienced improvement to pre-pandemic levels. We utilize a combination of internal manufacturing capabilities and contract manufacturing relationships for production efficiencies and to manage material and labor costs. We believe that our current manufacturing capabilities and contract relationships or comparable alternatives will continue to be available to us. However, we may encounter new product cost and competitive pricing pressures in the future and the extent of their impact on gross margins, if any, is uncertain.

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Selling, General and Administrative Expenses

SG&A expenses consist of marketing, sales, commissions, engineering, product development, management information systems, accounting, headquarters, and non-cash share-based employee compensation expenses.

SG&A expenses for the third quarter ended September 30, 2023, totaled approximately $5.8 million (29.0% of sales), compared with approximately $4.6 million (38.9% of sales) for the same quarter last year. For the nine months ended September 30, 2023, SG&A expenses increased by $2.7 million, or 18.3%, to approximately $17.7 million (30.6% of sales), compared with approximately $15.0 million (48.8% of sales), for the nine-month period last year.

Engineering and product development expenses for the third quarter of 2023 totaled approximately $2.5 million (12.5% of sales), compared with approximately $2.1 million (17.9% of sales) for the same quarter of last year. For the nine months ended September 30, 2023, engineering and product development expenses totaled approximately $7.5 million (13.0% of sales), compared with approximately $6.7 million (22.0% of sales) for the nine-month period last year. The increase in engineering expenses is attributed primarily to ongoing product design and development activities, particularly for the new BKR 9000 series radio introduced during the second quarter 2023. Most of these activities are being performed by our internal engineering team and are their primary focus, combined with sustaining engineering support of our existing products. The precise date for developing and introducing new products is uncertain and can be impacted by, among other things, supply chain shortages and certain component lead times in coming months and quarters.

Marketing and selling expenses for the third quarter of 2023 totaled approximately $1.5 million (7.5% of sales), compared with approximately $1.1 million (8.9% of sales) for the third quarter last year. For the nine months ended September 30, 2023, marketing and selling expenses increased approximately $1.4 million, or 46.0%, to approximately $4.6 million (7.9% of sales), compared with approximately $3.1 million (10.2% of sales) for the same period last year. The increases for the quarter and nine-month period ended September 30, 2023, primarily reflect increases in staffing, travel and go-to-market activities in support of anticipated sales growth from new products and customers.

Other general and administrative expenses for the third quarter 2023 totaled approximately $1.8 million (9.0% of sales), compared with approximately $1.4 million (12.1% of sales) for the same quarter last year. For the nine months ended September 30, 2023, general and administrative expenses totaled approximately $5.6 million (9.7% of sales), compared with approximately $5.1 million (16.6% of sales) for the nine-month period last year. The increase in general and administrative expenses for the quarter and nine months ended September 30, 2023, is attributed primarily to corporate and headquarters staffing in support of strategic initiatives.

Operating Income (Loss)

The operating income for the third quarter ended September 30, 2023, totaled approximately $0.6 million (2.9% of sales), compared with an operating loss of approximately $2.4 million (20.1% of sales) for last year’s third quarter. For the nine months ended September 30, 2023, our operating loss totaled approximately $1.2 million (2.0% of sales), compared with approximately $9.5 million (31.1% of sales) for the nine-month period last year. The operating loss for the quarter and nine months ended September 30, 2022, is somewhat attributed to lower than historical gross profit margins related to operating costs and increased product introduction and strategic initiative costs.

Other (Expense) Income

We recorded net interest expense of approximately $131,000 for the third quarter ended September 30, 2023, compared with approximately $30,000 for the third quarter of last year. For the nine months ended September 30, 2023, net interest expense totaled approximately $429,000, compared with net interest expense of approximately $70,000 for the nine-month period last year. Net interest expense was primarily the result of our Line of Credit and equipment financing.

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For the third quarter ended September 30, 2023, we recognized an unrealized loss of approximately $0.3 million on our investment in FG Holdings LLC, compared with a realized and unrealized gain of approximately $0.1 million on our investment in FGF made through 1347 LP for the third quarter last year. For the nine months ended September 30, 2023, we recognized an unrealized loss of approximately $0.8 million on our investment compared with a realized and unrealized loss of approximately $1.0 million for the same period last year.

Income Taxes

We recorded no tax expense or benefit for the quarter and nine months ended September 30, 2023, compared with no income tax provision for the third quarter and nine-month period last year.

Our income tax provision is based on management’s estimate of the effective tax rate for the full year. The tax provision (benefit) in any period will be affected by, among other things, permanent, as well as temporary, differences in the deductibility of certain items, in addition to changes in tax legislation. As a result, we may experience significant fluctuations in the effective book tax rate (that is, tax expense divided by pre-tax book income) from period to period.

As of September 30, 2023, our net deferred tax assets totaled approximately $4.1 million, and were primarily derived from research and development tax credits, operating loss carryforwards and deferred revenue.

In order to fully utilize the net deferred tax assets, we will need to generate sufficient taxable income in future years. We analyze all positive and negative evidence to determine if, based on the weight of available evidence, we are more likely than not to realize the benefit of the net deferred tax assets. The recognition of the net deferred tax assets and related tax benefits is based upon our conclusions regarding, among other considerations, estimates of future earnings based on information currently available and current and anticipated customers, contracts, and product introductions, as well as historical operating results and certain tax planning strategies.

Based on our analysis of all available evidence, both positive and negative, we have concluded that we do not have the ability to generate sufficient taxable income in the necessary period to utilize the entire benefit for the deferred tax assets. Accordingly, we established a valuation allowance of $4.2 million and $3.4 million as of September 30, 2023, and December 31, 2022, respectively. We cannot presently estimate what, if any, changes to the valuation of our deferred tax assets may be deemed appropriate in the future. If we incur future losses, it may be necessary to record additional valuation allowance related to the deferred tax assets recognized as of September 30, 2023.

Liquidity and Capital Resources

For the nine months ended September 30, 2023, net cash provided by operating activities totaled approximately $3.9 million, compared with cash used by operating activities of approximately $6.9 million for the same period last year. Cash provided by operating activities for the nine months ended September 30, 2023, was primarily related to a reduction in accounts receivable and inventories, and an increase in deferred revenues, which was partially offset by decrease in accounts payable. Cash used in operating activities for the nine months ended September 30, 2022, was primarily related to a net loss and increased inventory, which were partially offset by increased accounts payable, a decrease in accounts receivable and a realized and unrealized losses in marketable securities.

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For the first nine months of 2023, we had a net loss of approximately $2.5 million, compared with a net loss of approximately $10.7 million for the same period last year. Accounts receivable decreased approximately $1.5 million during the nine months ended September 30, 2023, compared with a decrease of approximately $2.9 million for the same period last year. Accounts payable for the nine months ended September 30, 2023, decreased approximately $1.1 million, compared with an increase of approximately $7.4 million for the first nine months last year, primarily due to delays and shortages within our supply chain for the same period of 2022. Gross inventories decreased during the nine months ended September 30, 2023, by approximately $0.6 million compared with an increase of approximately $9.4 million for the same period last year. The increases for both inventories and accounts payable during the first nine months of 2022 were attributed primarily to material and component availability combined with extended supplier lead times. Deferred revenues increased during the nine months ended September 30, 2023, by approximately $2.7 million compared with an increase of approximately $0.2 million for the same period last year. Prepaid expenses increased during the first nine months of 2023 by approximately $0.4 million compared with an increase of $0.1 million for the same period last year. Depreciation and amortization totaled approximately $1.2 million for the nine months ended September 30, 2023, compared with approximately $1.1 million for the same period last year. Depreciation and amortization are primarily related to manufacturing and engineering equipment. The unrealized loss on investments for the nine months ended September 30, 2023, totaled approximately $0.8 million, compared with a realized and unrealized losses of approximately $1.0 million for the same period last year. For additional information pertaining to our investments, refer to Note 1 (Condensed Consolidated Financial Statements) and Note 6 (Investments) to the condensed consolidated financial statements included in this report.

Cash used in investing activities for the nine months ended September 30, 2023, totaled approximately $1.8 million, compared with approximately $1.0 million for the same period last year. The cash used for both periods was attributed primarily to the purchase of engineering and manufacturing related equipment.

For the nine months ended September 30, 2023, cash of approximately $43,000 was provided by financing activities, compared with cash provided by financing activities of approximately $1.3 million for the same period last year. During the first nine months of 2023, we received cash of approximately $58.9 million from debt, net of repayments totaling approximately $58.9 million, while for the same period last year, we received proceeds of approximately $3.0 million from our revolving credit facility with Alterna and notes payable partially offset by loan and revolving credit facility repayments of approximately $0.2 million and paid quarterly dividends of approximately $1.5 million.

Our cash and cash equivalents balance on September 30, 2023, was approximately $4.1 million. We believe these funds, combined with anticipated cash generated from operations and borrowing availability under the IPSA, are sufficient to meet our working capital requirements for the foreseeable future. We may, depending on a variety of factors, including market conditions for capital raises, the trading price of our common stock and opportunities for uses of any proceeds, engage in public or private offerings of equity or debt securities to increase our capital resources. However, financial and economic conditions, which could be impacted by the current inflationary environment and current geopolitical tension, could limit our access to credit and impair our ability to raise capital, if needed, on acceptable terms or at all.

Critical Accounting Policies

In response to the SEC’s financial reporting release, FR-60, Cautionary Advice Regarding Disclosure About Critical Accounting Policies, we have selected for disclosure our revenue recognition process and our accounting processes involving significant judgments, estimates and assumptions. These processes affect our reported revenues and current assets and are, therefore, critical in assessing our financial and operating status. We regularly evaluate these processes in preparing our financial statements. The processes for revenue recognition, allowance for collection of trade receivables, allowance for excess or obsolete inventory and income taxes involve certain assumptions and estimates that we believe to be reasonable under present facts and circumstances. These estimates and assumptions, if incorrect, could adversely impact our operations and financial position.

There were no changes to our critical accounting policies during the three months ended September 30, 2023.

Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

As a “smaller reporting company” as defined by Item 229.10(f)(1) of Regulation S-K, the Company is not required to include the disclosure under this Item.

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Item 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures (as defined in Rules 13a-15(c) and 15d-15(e) under the Exchange Act) that are designed to ensure that information required to be disclosed in our reports under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer (who serves as our principal executive officer) and Chief Financial Officer (who serves as our principal financial and accounting officer), as appropriate, to allow timely decisions regarding required disclosure.

We carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer (principal executive officer) and Chief Financial Officer (principal financial officer), of the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act), as of the end of the period covered by this Quarterly Report. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of the end of the period covered by this Quarterly Report to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities Exchange Commission’s rules and forms, and that such information is accumulated and communicated to our management, including each of such officers as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Control over Financial Reporting

During the three months ended September 30, 2023, there were no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II - OTHER INFORMATION

Item 1A. RISK FACTORS

As of the date of this filing, except as set forth herein, there have been no material changes to the Risk Factors included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on March 16, 2023. The Risk Factors set forth in the 2022 Form 10-K should be read carefully in connection with evaluating our business and in connection with the forward-looking statements contained in this Quarterly Report on Form 10-Q. Any of the risks described in the 2022 Form 10-K, could materially adversely affect our business, financial condition or future results and the actual outcome of matters as to which forward-looking statements are made. These are not the only risks we face. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition and/or operating results.

Item 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Share Repurchase Program

On December 21, 2021, the Company announced that the Board has authorized a share repurchase program which permits the Company to purchase up to an aggregate of $5 million of its common shares. The program does not have an expiration date. Any repurchases would be funded using cash on hand and cash from operations. The actual timing, manner and number of shares repurchased under the program will be determined by management and the Board at their discretion, and will depend on several factors, including the market price of the Company’s common shares, general market and economic conditions, alternative investment opportunities, and other business considerations in accordance with applicable securities laws and exchange rules. The authorization of the share repurchase program does not require BK Technologies to acquire any particular number of shares and repurchases may be suspended or terminated at any time at the Company’s discretion. The following table provides information about purchases made by us of our common stock for each month included in the third quarter of 2023:

ISSUER PURCHASES OF EQUITY SECURITIES
Period	Total Number of Shares Purchased		Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs		Approximate Dollar Value of Shares that May Still be Purchased Under the Plans or Programs


July 1–31, 2023		—		—		—	$	5,000,000
August 1–31, 2023		—		—		—	$	5,000,000
September 1–30, 2023		—		—		—	$	5,000,000

Quarter Ended September 30, 2023		—	$	—		—	$	5,000,000

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Item 6. EXHIBITS

Exhibits required to be filed by Item 601 of Regulation S-K are listed in the Exhibit Index below.

Exhibit Index

Exhibit Number		Description

Exhibit 31.1		Certification of Principal Executive Officer Pursuant to Item 601(b)(31) of Regulation S-K, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
Exhibit 31.2		Certification of Principal Financial Officer Pursuant to Item 601(b)(31) of Regulation S-K, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
Exhibit 32.1		Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished pursuant to Item 601(b)(32) of Regulation S‑K)
Exhibit 32.2		Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished pursuant to Item 601(b)(32) of Regulation S‑K)
Exhibit 101.INS		XBRL Instance Document
Exhibit 101.SCH		XBRL Taxonomy Extension Schema Document
Exhibit 101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document
Exhibit 101.LAB		XBRL Taxonomy Extension Label Linkbase Document
Exhibit 101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document
Exhibit 101.DEF		XBRL Taxonomy Definition Linkbase Document
Exhibit 104		Cover Page Interactive Data File (embedded within the Inline XBRL document) (filed herewith)

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	BK TECHNOLOGIES CORPORATION
	(The “Registrant”)

Date: November 9, 2023	By:	/s/ John M. Suzuki
		John M. Suzuki Chief Executive Officer (Principal executive officer and duly authorized officer)

Date: November 9, 2023	By:	/s/ Scott A. Malmanger
		Scott A. Malmanger Chief Financial Officer (Principal financial and accounting officer and duly authorized officer)

nullnullnullnull

Cover - shares	9 Months Ended
Cover - shares	Sep. 30, 2023	Nov. 06, 2023
Cover [Abstract]
Entity Registrant Name	BK Technologies Corporation
Entity Central Index Key	0000002186
Document Type	10-Q
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Small Business	true
Entity Shell Company	false
Entity Emerging Growth Company	false
Entity Current Reporting Status	Yes
Document Period End Date	Sep. 30, 2023
Entity Filer Category	Non-accelerated Filer
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2023
Entity Common Stock Shares Outstanding		3,455,499
Entity File Number	001-32644
Entity Incorporation State Country Code	NV
Entity Tax Identification Number	83-4064262
Entity Address Address Line 1	7100 Technology Drive
Entity Address City Or Town	West Melbourne
Entity Address State Or Province	FL
Entity Address Postal Zip Code	32904
City Area Code	321
Local Phone Number	984-1414
Security 12b Title	Common Stock, par value $0.60 per share
Trading Symbol	BKTI
Security Exchange Name	NYSE
Document Quarterly Report	true
Document Transition Report	false
Entity Interactive Data Current	Yes

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Current assets:
Cash and cash equivalents	$ 4,066	$ 1,918
Trade accounts receivable, net	9,110	10,616
Inventories, net	21,573	22,105
Prepaid expenses and other current assets	1,963	1,578
Total current assets	36,712	36,217
Property, plant and equipment, net	5,501	4,884
Right-of-use (ROU) assets	1,669	1,991
Investments	650	1,481
Deferred tax assets, net	4,116	4,116
Other assets	420	143
Total assets	49,068	48,832
Current liabilities:
Accounts payable	11,763	12,898
Accrued compensation and related taxes	1,555	1,143
Accrued warranty expense	736	591
Accrued other expenses and other current liabilities	642	700
Short-term lease liabilities	514	485
Credit facility	6,459	5,854
Notes payable-current portion	94	277
Deferred revenue	1,110	1,022
Total current liabilities	22,873	22,970
Notes payable, net of current portion	0	329
Long-term lease liabilities	1,396	1,785
Deferred revenue	6,185	3,613
Total liabilities	30,454	28,697
Stockholders' equity:
Preferred stock; $1.00 par value; 1,000,000 authorized shares; none issued or outstanding	0	0
Common stock; $0.60 par value; 10,000,000 authorized shares; 3,722,970 and 3,686,939 issued and 3,432,890 and 3,396,859 outstanding shares as of September 30, 2023, and December 31, 2022, respectively	2,234	2,212
Additional paid-in capital	46,281	45,304
Accumulated deficit	(24,499)	(21,979)
Treasury stock, at cost, 290,080 shares as of September 30, 2023, and December 31, 2022, respectively	(5,402)	(5,402)
Total stockholders' equity	18,614	20,135
Total liabilities and stockholders' equity	$ 49,068	$ 48,832

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Sep. 30, 2023	Dec. 31, 2022
Condensed Consolidated Balance Sheets
Preferred Stock, Par Value	$ 1.00	$ 1.00
Preferred Stock, Shares Authorized	1,000,000	1,000,000
Preferred Stock, Shares Issued	0	0
Preferred Stock, Shares Outstanding	0	0
Common Stock, Par Value	$ 0.60	$ 0.60
Common Stock, Shares Authorized	10,000,000	10,000,000
Common Stock, Shares Issued	3,722,970	3,686,939
Common Stock, Shares Outstanding	3,432,890	3,396,859
Treasury Stock	290,080	290,080

Condensed Consolidated Statements Of Operations (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Condensed Consolidated Statements Of Operations (Unaudited)
Sales, net	$ 20,069	$ 11,917	$ 57,786	$ 30,612
Expenses
Cost of products	13,663	9,676	41,282	25,175
Selling, general and administrative expenses	5,812	4,632	17,681	14,952
Total operating expenses	19,475	14,308	58,963	40,127
Operating income (loss)	594	(2,391)	(1,177)	(9,515)
Other (expense) income:
Net interest expense	(131)	(30)	(429)	(70)
Gain (Loss) on investments	(342)	76	(831)	(1,021)
Other expense	(31)	(57)	(83)	(66)
Total other expense, net	(504)	(11)	(1,343)	(1,157)
Income (loss) before income taxes	90	(2,402)	(2,520)	(10,672)
Provision for income tax	0	0	0	0
Net income (loss)	$ 90	$ (2,402)	$ (2,520)	$ (10,672)
Net income (loss) per share-basic	$ 0.03	$ (0.71)	$ (0.74)	$ (3.16)
Net income (loss) per share-diluted	$ 0.03	$ (0.71)	$ (0.74)	$ (3.16)
Weighted average shares outstanding-basic	3,411,813	3,390,097	3,404,395	3,377,911
Weighted average shares outstanding-diluted	3,445,022	3,390,097	3,404,395	3,377,911

Condensed Consolidated Statements Of Cash Flows (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022
Operating activities
Net loss	$ (2,520)	$ (10,672)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Inventories allowances	(61)	48
Amortization of deferred finance and other assets	113	0
Depreciation and amortization	1,218	1,061
Share-based compensation expense-stock options	163	205
Share-based compensation expense-restricted stock units	773	367
Loss on investments	831	1,021
Changes in operating assets and liabilities:
Trade accounts receivable	1,506	2,850
Inventories	593	(9,402)
Prepaid expenses and other current assets	(385)	(77)
Other assets	(277)	(46)
ROU assets and lease liabilities	(38)	(27)
Accounts payable	(1,135)	7,374
Accrued compensation and related taxes	412	362
Accrued warranty expense	145	54
Deferred revenue	2,660	190
Accrued other expenses and other current liabilities	(58)	(166)
Net cash provided by (used in) operating activities	3,940	(6,858)
Investing activities
Purchases of property, plant, and equipment	(1,835)	(959)
Net cash used in investing activities	(1,835)	(959)
Financing activities
Proceeds from common stock issuance	63	0
Cash dividends paid	0	(1,519)
Proceeds from the credit facility and notes payable	58,896	2,988
Repayment of the credit facility and notes payable	(58,916)	(198)
Net cash provided by financing activities	43	1,271
Net change in cash and cash equivalents	2,148	(6,546)
Cash and cash equivalents, beginning of period	1,918	10,580
Cash and cash equivalents, end of period	4,066	4,034
Supplemental disclosure
Cash paid for interest	487	93
Non-cash financing activity
Common stock issued under restricted stock units	$ 556	$ 364

Condensed Consolidated Financial Statements

9 Months Ended

Sep. 30, 2023

Condensed Consolidated Financial Statements

Condensed Consolidated Financial Statements

1. Condensed Consolidated Financial Statements

Basis of Presentation

Principles of Consolidation

Fair Value of Financial Instruments

Liquidity

Reverse Stock Split

Recent Accounting Pronouncements

The Company does not discuss recent pronouncements that are not anticipated to have a material impact on or are unrelated to its financial condition, results of operations, cash flows or disclosures.

Significant Events and Transactions

9 Months Ended

Sep. 30, 2023

Significant Events and Transactions

Significant Events And Transactions

2. Significant Events and Transactions

Allowance for Doubtful Accounts

9 Months Ended

Sep. 30, 2023

Allowance for Doubtful Accounts

Allowance For Doubtful Accounts

3. Allowance for Doubtful Accounts

Inventories Net

9 Months Ended

Sep. 30, 2023

Inventories Net

Inventories, Net

4. Inventories, Net

Inventories, which are presented net of allowance for slow moving, excess, and obsolete inventory, consisted of the following:

	September 30, 2023		December 31, 2022
Finished goods	$	4,271	$	2,965
Work in process		7,042		7,313
Raw materials		10,260		11,827
	$	21,573	$	22,105

Income Taxes

9 Months Ended

Sep. 30, 2023

Income Taxes

Income Taxes

5. Income Taxes

The Company has recorded no tax expense or benefit for the three and nine months ended September 30, 2023 and 2022.

Investments

9 Months Ended

Sep. 30, 2023

Investments

Investments

6. Investments

Stockholders Equity

9 Months Ended

Sep. 30, 2023

Stockholders Equity

Stockholders' Equity

7. Stockholders’ Equity

The changes in condensed consolidated stockholders’ equity for the three and nine months ended September 30, 2023, and 2022, are as follows:

	Common Stock Shares		Common Stock Amount		Additional Paid-In Capital			Accumulated Deficit			Treasury Stock			Total
Balance as of December 31, 2022		3,686,939	$	2,212	$	45,304		$	(21,979	)	$	(5,402	)	$	20,135
Common stock issued		858		1		14			—			—			15
Common stock issued under restricted stock units		1,920		1		(1	)		—			—			—
Share-based compensation expense-stock options		—		—		58			—			—			58
Share-based compensation expense-restricted stock units		—		—		69			—			—			69
Net loss		—		—		—			(1,270	)		—			(1,270	)
Balance as of March 31, 2023		3,689,717		2,214		45,444			(23,249	)		(5,402	)		19,007

Common stock issued		2,661		2		33			—			—			35
Common stock issued under restricted stock units		1,920		1		(1	)		—			—			—
Share-based compensation expense-stock options		—		—		61			—			—			61
Share-based compensation expense-restricted stock units		—		—		63			—			—			63
Net loss		—		—		—			(1,340	)		—			(1,340	)
Balance as of June 30, 2023		3,694,298		2,217		45,600			(24,589	)		(5,402	)		17,826
Common stock issued		1,254		1		12			—			—			13
Common stock issued under restricted stock units		27,418		16		(16	)		—			—			—
Share-based compensation expense-stock options		—		—		44			—			—			44
Share-based compensation expense-restricted stock units		—		—		641			—			—			641
Net income		—		—		—			90			—			90
Balance as of September 30, 2023		3,722,970	$	2,234	$	46,281		$	(24,499	)	$	(5,402	)	$	18,614

	Common Stock Shares		Common Stock Amount		Additional Paid-In Capital			Accumulated Deficit			Treasury Stock			Total
Balance as of December 31, 2021		3,659,800	$	2,196	$	44,645		$	(8,821	)	$	(5,402	)	$	32,618
Common stock issued under restricted stock units		3,200		2		(2	)		—			—			—
Share-based compensation expense-stock options		—		—		85			—			—			85
Share-based compensation expense-restricted stock units		—		—		70			—			—			70
Net loss		—		—		—			(3,936	)		—			(3,936	)
Balance as of March 31, 2022		3,663,000		2,198		44,798			(12,757	)		(5,402	)		28,837
Common stock issued under restricted stock units		10,773		6		(6	)		—			—			—
Share-based compensation expense-stock options		—		—		51			—			—			51
Share-based compensation expense-restricted stock units		—		—		171			—			—			171
Common stock dividends ($0.03 per share)		—		—		—			(1,014	)		—			(1,015	)
Net loss		—		—		—			(4,334	)		—			(4,334	)
Balance as of June 30, 2022		3,673,773		2,204		45,014			(18,105	)		(5,402	)		23,711
Common stock issued under restricted stock units		13,166		8		(8	)		—			—			—
Share-based compensation expense-stock options		—		—		69			—			—			69
Share-based compensation expense-restricted stock units		—		—		126			—			—			126
Common stock dividends ($0.03 per share)		—		—		—			(511	)		—			(511	)
Net loss		—		—		—			(2,402	)		—			(2,402	)
Balance as of September 30, 2022		3,686,939	$	2,212	$	45,201		$	(21,018	)	$	(5,402	)	$	20,993

Income (Loss) Per Share

9 Months Ended

Sep. 30, 2023

Income (Loss) Per Share

Income (Loss) Per Share

8. Income (Loss) Per Share

The following table sets forth the computation of basic and diluted income (loss) per share:

	Three Months Ended September 30,					Nine Months Ended September 30,
	2023		2022			2023			2022
Numerator:
Net income (loss) for basic and diluted earnings per share	$	90	$	(2,402	)	$	(2,520	)	$	(10,672	)
Denominator for basic income (loss) per share weighted average shares		3,411,813		3,390,097			3,404,395			3,377,911
Effect of dilutive securities:
Options and restricted stock units		33,209		—			—			—
Denominator for diluted loss per share weighted average shares		3,445,022		3,390,097			3,404,395			3,377,911
Basic income (loss) per share	$	0.03	$	(0.71	)	$	(0.74	)	$	(3.16	)
Diluted income (loss) per share	$	0.03	$	(0.71	)	$	(0.74	)	$	(3.16	)

Non-Cash Share-Based Employee Compensation

9 Months Ended

Sep. 30, 2023

Non-Cash Share-Based Employee Compensation

Non-Cash Share-Based Employee Compensation

9. Non-Cash Share-Based Employee Compensation

Stock Options

A summary of activity under the Company’s stock option plans during the nine months ended September 30, 2023, is presented below:

	Stock Options		Wgt. Avg. Exercise Price ($) Per Share		Wgt. Avg. Remaining Contractual Life (Years)		Wgt. Avg. Grant Date Fair Value ($) Per Share		Aggregate Intrinsic Value ($)
As of January 1, 2023
Outstanding		200,300		15.48		7.87		5.64		460,925
Vested		86,846		17.83		6.73		6.57		101,090
Nonvested		113,454		13.68		8.74		4.93		359,835

Period activity
Issued		28,600		11.51		—		6.57		—
Exercised		—		—		—		—		—
Forfeited		2,300		13.58		—		4.97		—
Expired		2,000		11.15		—		7.02		—

As of September 30, 2023
Outstanding		224,600		15.03		7.49		5.75		60,410
Vested		135,913		16.27		6.87		5.89		19,789
Nonvested		88,687		13.13		8.45		5.54		40,621

Restricted Stock Units

A summary of non-vested restricted stock under the Company’s non-employee director share-based incentive compensation plan is as follows:

	Number of Shares		Weighted Average Grant Date Price per Share
Unvested as of January 1, 2023		41,129	$	13.20
Granted		45,412		12.37
Vested and issued		25,497		13.18
Vested-to be issued		31,663		11.87
Cancelled/forfeited		-		-
Unvested as of September 30, 2023		29,381	$	13.37

Commitments and Contingencies

9 Months Ended

Sep. 30, 2023

Commitments and contingencies

Commitments And Contingencies

10. Commitments and Contingencies

Legal Matters

Purchase Commitments

As of September 30, 2023, the Company had purchase commitments for inventory totaling approximately $13,134.

Significant Customers

Debt

9 Months Ended

Sep. 30, 2023

Debt

Debt

11. Debt

Credit Facilities

Notes Payable

The following table summarizes the notes payable principal repayments subsequent to September 30, 2023:

	September 30, 2023
Remaining three months of 2023	$	23
2024		71
Thereafter		—
Total payments	$	94

Leases

9 Months Ended

Sep. 30, 2023

Leases

Leases

12. Leases

Lease costs consisted of the following:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		, 2022
Operating lease cost	$	135	$	136	$	407	$	408
Short-term lease cost		—		—		—		—
Variable lease cost		33		33		99		99
Total lease cost	$	168	$	169	$	506	$	507

Supplemental cash flow information related to leases was as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows (fixed payments)	$	149	$	147	$	445	$	435
Operating cash flows (liability reduction)	$	123	$	114	$	360	$	331

ROU assets obtained in exchange for lease obligations:
Operating leases	$	—	$	—	$	—	$	—

Other information related to operating leases was as follows:

September 30,

2023

Weighted average remaining lease term (in years)

3.50

Weighted average discount rate

5.50

Maturity of lease liabilities as of September 30, 2023, were as follows:

	September 30, 2023
Remaining three months of 2023	$	150
2024		608
2025		618
2026		479
2027		242
Thereafter		—
Total payments		2,097
Less: imputed interest		(187	)
Total present value of lease liability	$	1,910

Subsequent Events

9 Months Ended

Sep. 30, 2023

Subsequent Events

Subsequent Events

13. Subsequent Events

Condensed Consolidated Financial Statements (Policies)	9 Months Ended
Condensed Consolidated Financial Statements (Policies)	Sep. 30, 2023
Condensed Consolidated Financial Statements
Basis Of Presentation	The condensed consolidated balance sheet as of September 30, 2023, the condensed consolidated statements of operations for the three and nine months ended September 30, 2023, and 2022, and the condensed consolidated statements of cash flows for the three and nine months ended September 30, 2023, and 2022, have been prepared by BK Technologies Corporation (the “Company,” “we,” “us,” “our”), and are unaudited. The condensed consolidated balance sheet as of December 31, 2022, has been derived from the Company’s audited consolidated financial statements at that date. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022, as filed with the Securities and Exchange Commission (“SEC”) on March 16, 2023. The results of operations for the three and nine months ended September 30, 2023, and 2022, are not necessarily indicative of the operating results for a full year.
Principles of Consolidation	The accounts of the Company and its subsidiaries have been included in the accompanying condensed consolidated financial statements. All significant intercompany balances and transactions have been eliminated in consolidation. The Company consolidates entities in which it has a controlling financial interest. The Company determines whether it has a controlling financial interest in an entity by first evaluating whether the entity is a variable interest entity (“VIE”) or a voting interest entity. VIEs are entities in which (i) the total equity investment at risk is not sufficient to enable the entity to finance its activities independently, or (ii) the at-risk equity holders do not have the normal characteristics of a controlling financial interest. A controlling financial interest in a VIE is present when an enterprise has one or more variable interests that have both (i) the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance, and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. The enterprise with a controlling financial interest is the primary beneficiary and consolidates the VIE. Voting interest entities lack one or more of the characteristics of a VIE. The usual condition for a controlling financial interest is ownership of a majority voting interest for a corporation or a majority of kick-out or participating rights for a limited partnership. When the Company does not have a controlling financial interest in an entity but exerts significant influence over the entity’s operating and financial policies (generally defined as owning a voting or economic interest of between 20% to 50%), the Company’s investment is accounted for under the equity method of accounting. If the Company does not have a controlling financial interest in, or exert significant influence over, an entity, the Company accounts for its investment at fair value, if the fair value option was elected or at cost. Through September 30, 2022, the Company was the sole limited partner in FGI 1347 Holdings, LP (“1347 LP”), a consolidated VIE. The Company ceased to be the limited partner of 1347 LP as of September 30, 2022.
Fair Value Of Financial Instruments	The Company’s financial instruments consist of cash and cash equivalents, trade accounts receivable, investments, accounts payable, accrued expenses, notes payable, credit facilities, and other liabilities. As of September 30, 2023, and December 31, 2022, the carrying amount of cash and cash equivalents, trade accounts receivable, accounts payable, accrued expenses, notes payable, credit facilities, and other liabilities approximated their respective fair value due to the short-term nature and maturity of these instruments. Prior to September 14, 2022, the Company held an investment in the common stock of FG Financial Group, Inc. (Nasdaq: FGF) (“FGF”), which investment was held by the Company in 1347 LP. The Company used observable market data assumptions (Level 1 inputs, as defined in accounting guidance) that it believes market participants would use in pricing its investment in FGF. Effective September 14, 2022, the Company has an investment in Series B common membership interests of FG Financial Holdings, LLC (“FG Holdings LLC”). As further discussed in Note 6, the Company records the investment according to guidance provided by ASC 820 “Fair Value Measurement”, as the Company does not have a controlling financial interest in, nor exerts significant influence over the activities of FG Holdings LLC. The investment in Series B common membership interests of FG Holdings LLC is reported using net asset value (“NAV”) of interests held by the Company at period-end. The NAV is calculated using the observable fair value of the underlying stock of FGF held by FG Holdings LLC, plus uninvested cash, less liabilities, further adjusted through allocations based on distribution preferences, as defined in operating agreement of FG Holdings LLC. The NAV is used as a practical expedient and has not been classified within the fair value hierarchy.
Liquidity	The Company incurred operating losses during 2023 and 2022 and reported negative cash flows from operations during 2022. The Company’s operating results have been negatively impacted by the worldwide shortages of materials, in particular semiconductors and integrated circuits, extended lead times, and increased costs and inventory levels for certain components. On November 22, 2022, the Company’s subsidiaries, BK Technologies, Inc. and RELM Communications, Inc. (the “Subsidiaries”), entered into an Invoice Purchase and Security Agreement (“IPSA”) with Alterna Capital Solutions, LLC (“Alterna”), providing for a one-year line of credit with total maximum funding up to $15 million (the “Line of Credit”). The Company used funds obtained from the Line of Credit to replace the JPMC Credit Agreement (defined below) (see Note 11). Management believes that cash and cash equivalents currently available, combined with anticipated cash to be generated from operations, and borrowing ability are sufficient to meet the Company’s working capital requirements in the foreseeable future. The Company generally relies on cash from operations, commercial debt, and equity offerings to the extent available, to satisfy its liquidity needs and to meet its payment obligations. The Company may engage in public or private offerings of equity or debt securities to maintain or increase its liquidity and capital resources. However, financial and economic conditions, including those resulting from the current inflationary environment and current geopolitical tension, could impact our ability to raise capital or debt financing, if needed, on acceptable terms or at all.
Reverse Stock Split	On March 23, 2023, the board of directors (the “Board”) of the Company approved a one (1)-for-five (5) reverse stock split (the “Reverse Stock Split”) of the Company’s issued and outstanding shares of common stock, par value $0.60 per share (the “Common Stock”), and on April 4, 2023, the Company filed with the Secretary of State of the State of Nevada a Certificate of Change to its Articles of Incorporation to effect the Reverse Stock Split. The Company executed the Reverse Stock Split, which became effective at 5:00 p.m. Eastern Time on April 21, 2023. Shares of Common Stock underlying outstanding stock options and restricted stock units were proportionately reduced, and the respective exercise prices were proportionately increased in accordance with the terms of the agreements governing such securities. Accordingly, all shares and per share amounts for all periods presented in the accompanying condensed consolidated financial statements and notes thereto have been retroactively adjusted, where applicable, to reflect the Reverse Stock Split.
Recent Accounting Pronouncements	The Company does not discuss recent pronouncements that are not anticipated to have a material impact on or are unrelated to its financial condition, results of operations, cash flows or disclosures.

Inventories Net (Tables)

9 Months Ended

Sep. 30, 2023

Inventories Net

Components of inventory

	September 30, 2023		December 31, 2022
Finished goods	$	4,271	$	2,965
Work in process		7,042		7,313
Raw materials		10,260		11,827
	$	21,573	$	22,105

Stockholders Equity (Tables)

9 Months Ended

Sep. 30, 2023

Stockholders Equity

Changes in consolidated stockholders' equity

	Common Stock Shares		Common Stock Amount		Additional Paid-In Capital			Accumulated Deficit			Treasury Stock			Total
Balance as of December 31, 2022		3,686,939	$	2,212	$	45,304		$	(21,979	)	$	(5,402	)	$	20,135
Common stock issued		858		1		14			—			—			15
Common stock issued under restricted stock units		1,920		1		(1	)		—			—			—
Share-based compensation expense-stock options		—		—		58			—			—			58
Share-based compensation expense-restricted stock units		—		—		69			—			—			69
Net loss		—		—		—			(1,270	)		—			(1,270	)
Balance as of March 31, 2023		3,689,717		2,214		45,444			(23,249	)		(5,402	)		19,007

Common stock issued		2,661		2		33			—			—			35
Common stock issued under restricted stock units		1,920		1		(1	)		—			—			—
Share-based compensation expense-stock options		—		—		61			—			—			61
Share-based compensation expense-restricted stock units		—		—		63			—			—			63
Net loss		—		—		—			(1,340	)		—			(1,340	)
Balance as of June 30, 2023		3,694,298		2,217		45,600			(24,589	)		(5,402	)		17,826
Common stock issued		1,254		1		12			—			—			13
Common stock issued under restricted stock units		27,418		16		(16	)		—			—			—
Share-based compensation expense-stock options		—		—		44			—			—			44
Share-based compensation expense-restricted stock units		—		—		641			—			—			641
Net income		—		—		—			90			—			90
Balance as of September 30, 2023		3,722,970	$	2,234	$	46,281		$	(24,499	)	$	(5,402	)	$	18,614

	Common Stock Shares		Common Stock Amount		Additional Paid-In Capital			Accumulated Deficit			Treasury Stock			Total
Balance as of December 31, 2021		3,659,800	$	2,196	$	44,645		$	(8,821	)	$	(5,402	)	$	32,618
Common stock issued under restricted stock units		3,200		2		(2	)		—			—			—
Share-based compensation expense-stock options		—		—		85			—			—			85
Share-based compensation expense-restricted stock units		—		—		70			—			—			70
Net loss		—		—		—			(3,936	)		—			(3,936	)
Balance as of March 31, 2022		3,663,000		2,198		44,798			(12,757	)		(5,402	)		28,837
Common stock issued under restricted stock units		10,773		6		(6	)		—			—			—
Share-based compensation expense-stock options		—		—		51			—			—			51
Share-based compensation expense-restricted stock units		—		—		171			—			—			171
Common stock dividends ($0.03 per share)		—		—		—			(1,014	)		—			(1,015	)
Net loss		—		—		—			(4,334	)		—			(4,334	)
Balance as of June 30, 2022		3,673,773		2,204		45,014			(18,105	)		(5,402	)		23,711
Common stock issued under restricted stock units		13,166		8		(8	)		—			—			—
Share-based compensation expense-stock options		—		—		69			—			—			69
Share-based compensation expense-restricted stock units		—		—		126			—			—			126
Common stock dividends ($0.03 per share)		—		—		—			(511	)		—			(511	)
Net loss		—		—		—			(2,402	)		—			(2,402	)
Balance as of September 30, 2022		3,686,939	$	2,212	$	45,201		$	(21,018	)	$	(5,402	)	$	20,993

Income (Loss) Per Share (Tables)

9 Months Ended

Sep. 30, 2023

Income (Loss) Per Share

Computation Of Basic And Diluted Loss Per Share

	Three Months Ended September 30,					Nine Months Ended September 30,
	2023		2022			2023			2022
Numerator:
Net income (loss) for basic and diluted earnings per share	$	90	$	(2,402	)	$	(2,520	)	$	(10,672	)
Denominator for basic income (loss) per share weighted average shares		3,411,813		3,390,097			3,404,395			3,377,911
Effect of dilutive securities:
Options and restricted stock units		33,209		—			—			—
Denominator for diluted loss per share weighted average shares		3,445,022		3,390,097			3,404,395			3,377,911
Basic income (loss) per share	$	0.03	$	(0.71	)	$	(0.74	)	$	(3.16	)
Diluted income (loss) per share	$	0.03	$	(0.71	)	$	(0.74	)	$	(3.16	)

Non-Cash Share-Based Employee Compensation (Tables)

9 Months Ended

Sep. 30, 2023

Non-Cash Share-Based Employee Compensation

Summary of stock option activity

	Stock Options		Wgt. Avg. Exercise Price ($) Per Share		Wgt. Avg. Remaining Contractual Life (Years)		Wgt. Avg. Grant Date Fair Value ($) Per Share		Aggregate Intrinsic Value ($)
As of January 1, 2023
Outstanding		200,300		15.48		7.87		5.64		460,925
Vested		86,846		17.83		6.73		6.57		101,090
Nonvested		113,454		13.68		8.74		4.93		359,835

Period activity
Issued		28,600		11.51		—		6.57		—
Exercised		—		—		—		—		—
Forfeited		2,300		13.58		—		4.97		—
Expired		2,000		11.15		—		7.02		—

As of September 30, 2023
Outstanding		224,600		15.03		7.49		5.75		60,410
Vested		135,913		16.27		6.87		5.89		19,789
Nonvested		88,687		13.13		8.45		5.54		40,621

Summary of non-vested restricted stock

	Number of Shares		Weighted Average Grant Date Price per Share
Unvested as of January 1, 2023		41,129	$	13.20
Granted		45,412		12.37
Vested and issued		25,497		13.18
Vested-to be issued		31,663		11.87
Cancelled/forfeited		-		-
Unvested as of September 30, 2023		29,381	$	13.37

Debt (Tables)

9 Months Ended

Sep. 30, 2023

Debt

Schedule of current balances of note payable

	September 30, 2023
Remaining three months of 2023	$	23
2024		71
Thereafter		—
Total payments	$	94

Leases (Tables)

9 Months Ended

Sep. 30, 2023

Leases

Lease cost

	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		, 2022
Operating lease cost	$	135	$	136	$	407	$	408
Short-term lease cost		—		—		—		—
Variable lease cost		33		33		99		99
Total lease cost	$	168	$	169	$	506	$	507

Supplemental cash flow information related to leases

	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows (fixed payments)	$	149	$	147	$	445	$	435
Operating cash flows (liability reduction)	$	123	$	114	$	360	$	331

ROU assets obtained in exchange for lease obligations:
Operating leases	$	—	$	—	$	—	$	—

Other information related to operating leases

September 30,

2023

Weighted average remaining lease term (in years)

3.50

Weighted average discount rate

5.50

Schedule of maturity of lease liabilities

	September 30, 2023
Remaining three months of 2023	$	150
2024		608
2025		618
2026		479
2027		242
Thereafter		—
Total payments		2,097
Less: imputed interest		(187	)
Total present value of lease liability	$	1,910

Condensed Consolidated Financial Statements (Details Narrative) - USD ($) $ / shares in Units, $ in Millions	9 Months Ended
	Sep. 30, 2023	Dec. 31, 2022
Reverse stock split	one (1)-for-five (5)
Line of Credit	$ 15
Common stock, par value	$ 0.60	$ 0.60
Minimum [Member] \| F G Financial Group [Member]
Voting Interest	20.00%
Maximum [Member] \| F G Financial Group [Member]
Voting Interest	50.00%

Significant Events and Transactions (Details Narrative) - Minimum [Member] - F G Financial Group [Member]	9 Months Ended
	Sep. 30, 2023 USD ($) shares
Common stock, shares sold \| shares	845,070
Offering price \| $	$ 15,000,000

Allowance for Doubtful Accounts (Details Narrative) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Allowance for Doubtful Accounts
Allowance for doubtful accounts on trade receivables	$ 50
Accounts receivable, Gross	$ 9,160	$ 10,666

Inventories Net (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Inventories Net
Finished Goods	$ 4,271	$ 2,965
Work In Process	7,042	7,313
Raw Materials	10,260	11,827
Total Inventory	$ 21,573	$ 22,105

Inventories Net (Details Narrative) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Inventories Net
Inventories, net of allowance for slow moving, excess	$ 1,186	$ 1,247

Income Taxes (Details Narrative) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
Income Taxes (Details Narrative) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Income Taxes
Net Deferred Tax Assets	$ 4,116	$ 4,116
Valuation Allowance	$ 4,212	$ 3,356

Investments (Details Narrative) - USD ($) $ in Thousands	9 Months Ended
Investments (Details Narrative) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Common stock shares authorized	10,000,000	10,000,000
F G Financial Group [Member]
Holding percentage	20.00%
Common stock shares authorized	5,666,111
Ownership percentage of outstanding shares	55.00%
Share Purchased	$ 3,741
Fair Value Investment	$ 945

Stockholders Equity (Details) - USD ($)	3 Months Ended						9 Months Ended
Stockholders Equity (Details) - USD ($)	Sep. 30, 2023	Jun. 30, 2023	Mar. 31, 2023	Sep. 30, 2022	Jun. 30, 2022	Mar. 31, 2022	Sep. 30, 2023	Sep. 30, 2022
Beginning balance, Amount			$ 20,135,000				$ 20,135,000
Net Income (loss)	$ 90,000			$ (2,402,000)			(2,520,000)	$ (10,672,000)
Share-based Compensation Expense-restricted Stock Units							773,000	$ 367,000
Ending balance, Amount	$ 18,614,000						$ 18,614,000
Common Stocks [Member]
Beginning balance, Shares	3,694,298	3,689,717	3,686,939	3,673,773	3,663,000	3,659,800	3,686,939	3,659,800
Beginning balance, Amount	$ 2,217,000	$ 2,214,000	$ 2,212,000	$ 2,204,000	$ 2,198,000	$ 2,196,000	$ 2,212,000	$ 2,196,000
Net Income (loss)	$ 0	$ 0	$ 0	$ 0	$ 0	$ 0
Common stock issued, shares	1,254	2,661	858
Common stock issued, amount	$ 1,000	$ 2,000	$ 1,000
Common Stock Issued Under Restricted Stock Units, shares	27,418	1,920	1,920	13,166	10,773	3,200
Common Stock Issued Under Restricted Stock Units, Amount	$ 16,000	$ 1,000	$ 1,000	$ 8,000	$ 6,000	$ 2,000
Share-based Compensation Expense-stock Options	0	0	0	0	0	0
Share-based Compensation Expense-restricted Stock Units	$ 0	$ 0	$ 0	0	0	$ 0
Common stock dividends ($0.03 per share)				$ 0	$ 0
Ending Balance, shares	3,722,970	3,694,298	3,689,717	3,686,939	3,673,773	3,663,000	3,722,970	3,686,939
Ending balance, Amount	$ 2,234,000	$ 2,217,000	$ 2,214,000	$ 2,212,000	$ 2,204,000	$ 2,198,000	$ 2,234,000	$ 2,212,000
Additional Paids-In Capital [Member]
Beginning balance, Amount	45,600,000	45,444,000	45,304,000	45,014,000	44,798,000	44,645,000	45,304,000	44,645,000
Net Income (loss)	0	0	0	0	0	0
Common stock issued, amount	12,000	33,000	14,000
Common Stock Issued Under Restricted Stock Units, Amount	(7,000)	(1,000)	(1,000)	(8,000)	(6,000)	(2,000)
Share-based Compensation Expense-stock Options	44,000	61,000	58,000	69,000	51,000	85,000
Share-based Compensation Expense-restricted Stock Units	641,000	63,000	69,000	126,000	171,000	70,000
Common stock dividends ($0.03 per share)				0	0
Ending balance, Amount	46,281,000	45,600,000	45,444,000	45,201,000	45,014,000	44,798,000	46,281,000	45,201,000
Retained Earning (Accumulated Deficit) [Member]
Beginning balance, Amount	(24,589,000)	(23,249,000)	(21,979,000)	(18,105,000)	(12,757,000)	(8,821,000)	(21,979,000)	(8,821,000)
Net Income (loss)	90,000	(1,340,000)	(1,270,000)	(2,402,000)	(4,334,000)	(3,936,000)
Common stock issued, amount	0	0	0
Common Stock Issued Under Restricted Stock Units, Amount	0	0	0	0	0	0
Share-based Compensation Expense-stock Options	0	0	0	0	0	0
Share-based Compensation Expense-restricted Stock Units	0	0	0	0	0	0
Common stock dividends ($0.03 per share)				(511,000)	(1,014,000)
Ending balance, Amount	(24,499,000)	(24,589,000)	(23,249,000)	(21,018,000)	(18,105,000)	(12,757,000)	(24,499,000)	(21,018,000)
Treasury Stocks [Member]
Beginning balance, Amount	(5,402,000)	(5,402,000)	(5,402,000)	(5,402,000)	(5,402,000)	(5,402,000)	(5,402,000)	(5,402,000)
Net Income (loss)	0	0	0	0	0	0
Common stock issued, amount	0	0	0
Common Stock Issued Under Restricted Stock Units, Amount	0	0	0	0	0	0
Share-based Compensation Expense-stock Options	0	0	0	0	0	0
Share-based Compensation Expense-restricted Stock Units	0	0	0	0	0	0
Common stock dividends ($0.03 per share)				0	0
Ending balance, Amount	(5,402,000)	(5,402,000)	(5,402,000)	(5,402,000)	(5,402,000)	(5,402,000)	(5,402,000)	(5,402,000)
Total [Member]
Beginning balance, Amount	17,826,000	19,007,000	20,135,000	23,711,000	28,837,000	32,618,000	20,135,000	32,618,000
Net Income (loss)	90,000	(1,340,000)	(1,270,000)	(2,402,000)	(4,334,000)	(3,936,000)
Common stock issued, amount	13,000	35,000	15,000
Common Stock Issued Under Restricted Stock Units, Amount	0	0	0	0	0	0
Share-based Compensation Expense-stock Options	44,000	61,000	58,000	69,000	51,000	85,000
Share-based Compensation Expense-restricted Stock Units	641,000	63,000	69,000	126,000	171,000	70,000
Common stock dividends ($0.03 per share)				(511,000)	(1,015,000)
Ending balance, Amount	$ 18,614,000	$ 17,826,000	$ 19,007,000	$ 20,993,000	$ 23,711,000	$ 28,837,000	$ 18,614,000	$ 20,993,000

Stockholders Equity (Details Narrative) - shares	Sep. 30, 2023	Dec. 31, 2022
Preferred Stock, Shares Outstanding	0	0
Common Stock, Shares Issued	3,722,970	3,686,939
Common Stock, Shares Outstanding	3,432,890	3,396,859
Common Stocks [Member]
Preferred Stock, Shares Outstanding	0
Common Stock, Shares Issued	3,745,579
Common Stock, Shares Outstanding	3,455,499

Income (Loss) Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Numerator:
Net loss for basic and diluted earnings per share	$ 90	$ (2,402)	$ (2,520)	$ (10,672)
Denominator:
Denominator For Basic Loss Per Share Weighted Average Shares	3,411,813	3,390,097	3,404,395	3,377,911
Effect Of Dilutive Securities:
Options and restricted stock units	33,209	0	0	0
Denominator For Diluted Loss Per Share Weighted Average Shares	3,445,022	3,390,097	3,404,395	3,377,911
Basic income (loss) per share	$ 0.03	$ (0.71)	$ (0.74)	$ (3.16)
Diluted income (loss) per share	$ 0.03	$ (0.71)	$ (0.74)	$ (3.16)

Income (Loss) Per Share (Details Narrative) - shares	3 Months Ended		9 Months Ended
Income (Loss) Per Share (Details Narrative) - shares	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Restricted Stock Units [Member]
Antidilutive Securities	28,569	41,129	29,381	41,129
Stock Options [Member]
Antidilutive Securities	168,600	220,300	224,600	220,300

Non-Cash Share-Based Employee Compensation (Details)	9 Months Ended
Non-Cash Share-Based Employee Compensation (Details)	Sep. 30, 2023 USD ($) $ / shares shares
Non-Cash Share-Based Employee Compensation
Outstanding, Beginning Balance \| shares	200,300
Vested, Beginning Balance \| shares	86,846
Nonvested, Beginning Balance \| shares	113,454
Issued \| shares	28,600
Exercised \| shares	0
Forfeited \| shares	2,300
Expired \| shares	2,000
Outstanding, Ending Balance \| shares	224,600
Vested, Ending Balance \| shares	135,913
Nonvested, Ending Balance \| shares	88,687
Wgt. Avg. Exercise Price Per Share, Outstanding, Beginning Balance	$ 15.48
Wgt. Avg. Exercise Price Per Share, Vested, Beginning Balance	17.83
Wgt. Avg. Exercise Price Per Share, Nonvested, Beginning Balance	13.68
Wgt. Avg. Exercise Price Per Share, Issued	11.51
Wgt. Avg. Exercise Price Per Share, Exercised	0
Wgt. Avg. Exercise Price Per Share, Forfeited	13.58
Wgt. Avg. Exercise Price Per Share, Expired	11.15
Wgt.avg. Exercise Price Per Share, outstanding, ending Balance	15.03
Wgt. Avg. Exercise Price Per Share, Vested, Ending Balance	16.27
Wgt. Avg. Exercise Price Per Share, Nonvested, Ending Balance	$ 13.13
Wgt. Avg. Remaining Contractual Life (Years), Outstanding, Beginning balance	7 years 10 months 13 days
Wgt. Avg. Remaining Contractual Life (Years), Vested, Beginning balance	6 years 8 months 23 days
Wgt. Avg. Remaining Contractual Life (Years), Nonvested, Beginning balance	8 years 8 months 26 days
Wgt. Avg. Remaining Contractual Life (Years), Outstanding, Ending balance	7 years 5 months 26 days
Wgt. Avg. Remaining Contractual Life (Years), Vested, Ending balance	6 years 10 months 13 days
Wgt. Avg. Remaining Contractual Life (Years), Nonvested, Ending balance	8 years 5 months 12 days
Wgt. Avg. Grant Date Fair Value Per Share, Outstanding, Beginning Balance	$ 5.64
Wgt. Avg. Grant Date Fair Value Per Share, Vested, Beginning Balance	6.57
Wgt. Avg. Grant Date Fair Value Per Share, Nonvested, Beginning Balance	4.93
Wgt. Avg. Grant Date Fair Value Per Share, Issued	6.57
Wgt. Avg. Grant Date Fair Value Per Share, Exercised	0
Wgt. Avg. Grant Date Fair Value Per Share, Forfeited	4.97
Wgt. Avg. Grant Date Fair Value Per Share, Expired	7.02
Wgt. Avg. Grant Date Fair Value Per Share, Outstanding, Ending Balance	5.75
Wgt. Avg. Grant Date Fair Value Per Share, Vested, Ending Balance	5.89
Wgt. Avg. Grant Date Fair Value Per Share, Nonvested, Ending Balance	$ 5.54
Aggregate Intrinsic Value, Outstanding, Beginning Balance \| $	$ 460,925,000
Aggregate Intrinsic Value, Vested, Beginning Balance \| $	101,090,000
Aggregate Intrinsic Value, Nonvested, Beginning Balance \| $	359,835
Aggregate Intrinsic Value, Issued \| $	0
Aggregate Intrinsic Value, Exercised \| $	0
Aggregate Intrinsic Value, Forfeited \| $	0
Aggregate Intrinsic Value, Expired \| $	0
Aggregate Intrinsic Value, Outstanding, Ending Balance \| $	60,410,000
Aggregate Intrinsic Value, Vested, Ending Balance \| $	19,789,000
Aggregate Intrinsic Value, Nonvested, Ending Balance \| $	$ 40,621

Non-Cash Share-Based Employee Compensation (Details1)	9 Months Ended
Non-Cash Share-Based Employee Compensation (Details1)	Sep. 30, 2023 $ / shares shares
Non-Cash Share-Based Employee Compensation
Number of shares Unvested begaining \| shares	41,129
Number of shares granted \| shares	45,412
Number of shares Vested and issued \| shares	(25,497)
Number of shares Vested-to be issued \| shares	31,663
Number of shares Cancelled/forfeited \| shares	2,300
Number of shares Unvested ending balance \| shares	29,381
Weighted Average price per shares Unvested begaining balance \| $ / shares	$ 13.20
Weighted Average price per shares Granted \| $ / shares	12.37
Weighted Average price per shares Vested and issued \| $ / shares	13.18
Weighted Average price per shares Vested-to be issued \| $ / shares	11.87
Weighted Average price per shares Cancelled/forfeited \| $ / shares	0
Weighted Average price per shares Unvested ending balance \| $ / shares	$ 13.37

Non-Cash Share-Based Employee Compensation (Details Narrative) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Employee and Non-Employee Director [Member]
Share Based Compensation Expense	$ 44	$ 69	$ 163	$ 205
Restricted Stock Units [Member]
Share Based Compensation Expense	$ 641	$ 126	$ 773	$ 367

Commitments and Contingencies (Details Narrative) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Purchase Commitments	$ 13,134		$ 13,134
Accounts Receivable From Us Government	4,280	$ 1,545	4,280	$ 1,545
Sales	20,069	11,917	57,786	30,612
United States Government Agencies [Member]
Sales	$ 12,142	$ 4,196	$ 29,571	$ 11,161
Sales Percentage	60.50%	35.20%	51.20%	36.40%

Debt (Details) $ in Thousands	Sep. 30, 2023 USD ($)
Debt
Remaining three months of 2023	$ 23
2024	71
Thereafter	0
Total Payments	$ 94

Debt (Details Narrative) $ in Thousands	1 Months Ended		3 Months Ended	9 Months Ended
Debt (Details Narrative) $ in Thousands	Nov. 22, 2022 USD ($)	Sep. 25, 2019 USD ($)	Sep. 30, 2023 USD ($)	Sep. 30, 2023 USD ($)	Apr. 06, 2021 USD ($) integer
Description of transferred receivables				the Company transferred receivables having an aggregate face value of $17.5 and $52.5 million, respectively, to the conduit and received proceeds of $18.2 and $58.9 million, respectively, which also include draws on available inventory funding. There were no losses incurred on these transfers during the three and nine months ended September 30, 2023
Interest and related servicing fees			$ 153	$ 476
Transferred receivables				85.00%
Credit Agreement [Member]
Outstanding borrowings credit facility			$ 6,500	$ 6,500
Outstanding principal amount of receivables				$ 7,000
Master loan agreement installments \| integer					60
Principal and interest payments		$ 8
Principal and interest payments, beginning date		October 25, 2019
Principal and interest payments, maturity date		September 25, 2024
Principal and interest payments, interest rate percentage		5.11%
Master loan agreement amount		$ 425			$ 743
Invoice Purchase And Security Agreement
Principal and interest payments, interest rate percentage	1.85%
Line of credit maximum funding amount	$ 15,000
Effective borrowing rate			10.35%	10.35%
Description of IPSA	the IPSA, to modify the IPSA to, among other things, provide a credit facility for up to 75% of net orderly liquidation value of inventory, not to exceed 100% of the eligible accounts receivable balance
JP Morgan Chase Bank [Member]
Outstanding balance of the credit facility				$ 4,500
Subsequently expired				January 31, 2023

Leases (Details) - USD ($)	3 Months Ended		9 Months Ended
Leases (Details) - USD ($)	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Leases
Operating lease cost	$ 135,000	$ 136,000	$ 407,000	$ 408,000
Short-term lease cost	0	0	0	0
Variable lease cost	33,000	33,000	99,000	99,000
Total lease cost	$ 168,000	$ 169,000	$ 506,000	$ 507,000

Leases (Details 1) - USD ($)	3 Months Ended		9 Months Ended
Leases (Details 1) - USD ($)	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows (fixed payments)	$ 149,000	$ 147,000	$ 445,000	$ 435,000
Operating cash flows (liability reduction)	123,000	114,000	360,000	331,000
ROU assets obtained in exchange for lease obligations:
Operating leases	$ 0	$ 0	$ 0	$ 0

Leases (Details 2)	9 Months Ended
Leases (Details 2)	Sep. 30, 2023
Leases
Weighted Average Remaining Lease Term (in Years)	3 years 6 months
Weighted Average Discount Rate	5.50%

Leases (Details 3)	Sep. 30, 2023 USD ($)
Leases
Remaining nine months of 2023	$ 150,000
2024	608,000
2025	618,000
2026	479,000
2027	242,000
Thereafter	0
Total payments	2,097,000
Less: imputed interest	187,000
Total present value of lease liability	$ 1,910,000

Leases (Details Narrative) $ in Thousands	1 Months Ended	9 Months Ended
Leases (Details Narrative) $ in Thousands	Feb. 28, 2021	Sep. 30, 2023 USD ($) ft²	Feb. 28, 2020 ft²
Area Of Lease Land \| ft²		54,000	6,857
Lease Expiration Date		September 30, 2027
Annual Rental, Maintenance And Tax Expenses On Lease		$ 491
Lease Term	64 years
Sawgrass Technology Park [Member]
Annual Rental, Maintenance And Tax Expenses On Lease		$ 196
Annual rental, maintenance and tax expenses increased percentage annually		3.00%

Subsequent Events (Details Narrative) - Subsequent Event [Member] - USD ($)	Nov. 06, 2023	Oct. 13, 2023	Oct. 12, 2023
Description about payment of retired company president			Pursuant to the Separation Agreement, the Company will pay to Mr. Vitou $283,250, which amounts to twelve months of compensation at Mr. Vitou’s current normal base pay rate, less taxes, social security and other required withholdings, to be paid in bi-weekly increments in accordance with the Company’s regular payroll practices
Purchase of warrant	135,300
Payments for warrants	$ 1,000,000
Warrants price per share	$ 15.00
Common stock issued, value	$ 1,000,000
Common stock issued , per share	$ 12.90
Common stock issued, shares	77,520
Joshua Horowitz [Member]
Restricted stock units granted		1,920

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BKTI BK Technologies Corporation