P0Y11666296196171071036217000000000000001600983--12-312022Q2falsefalse01313119700593692926085487NASDAQNon-accelerated Filer0001600983kscp:WarrantsToPurchaseSeriesSClassPreferredStockMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2022-06-300001600983kscp:WarrantsToPurchaseSeriesM3ClassPreferredStockMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2022-06-300001600983kscp:WarrantsToPurchaseSeriesSClassPreferredStockMemberus-gaap:FairValueMeasurementsRecurringMember2022-06-300001600983kscp:WarrantsToPurchaseSeriesM3ClassPreferredStockMemberus-gaap:FairValueMeasurementsRecurringMember2022-06-300001600983kscp:WarrantsToPurchaseSeriesSClassPreferredStockMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2021-12-310001600983kscp:WarrantsToPurchaseSeriesM3ClassPreferredStockMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2021-12-310001600983kscp:WarrantsToPurchaseSeriesBClassBPreferredStockMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2021-12-310001600983kscp:WarrantsToPurchaseSeriesSClassPreferredStockMemberus-gaap:FairValueMeasurementsRecurringMember2021-12-310001600983kscp:WarrantsToPurchaseSeriesM3ClassPreferredStockMemberus-gaap:FairValueMeasurementsRecurringMember2021-12-310001600983kscp:WarrantsToPurchaseSeriesBClassBPreferredStockMemberus-gaap:FairValueMeasurementsRecurringMember2021-12-310001600983kscp:SeriesM1PreferredStockMemberus-gaap:PreferredStockMember2021-06-300001600983kscp:SeriesM1PreferredStockMemberus-gaap:PreferredStockMember2021-03-310001600983us-gaap:RetainedEarningsMember2022-04-012022-06-300001600983us-gaap:CommonClassAMember2022-04-042022-04-040001600983us-gaap:CommonClassAMemberkscp:StockPurchaseAgreementMember2022-01-012022-06-300001600983us-gaap:RetainedEarningsMember2022-06-300001600983us-gaap:AdditionalPaidInCapitalMember2022-06-300001600983us-gaap:RetainedEarningsMember2022-03-310001600983us-gaap:AdditionalPaidInCapitalMember2022-03-3100016009832022-03-310001600983us-gaap:RetainedEarningsMember2021-12-310001600983us-gaap:AdditionalPaidInCapitalMember2021-12-310001600983us-gaap:RetainedEarningsMember2021-06-300001600983us-gaap:AdditionalPaidInCapitalMember2021-06-300001600983us-gaap:RetainedEarningsMember2021-03-310001600983us-gaap:AdditionalPaidInCapitalMember2021-03-3100016009832021-03-310001600983us-gaap:RetainedEarningsMember2020-12-310001600983us-gaap:AdditionalPaidInCapitalMember2020-12-310001600983us-gaap:CommonClassBMemberus-gaap:CommonStockMember2022-06-300001600983us-gaap:CommonClassAMemberus-gaap:CommonStockMember2022-06-300001600983us-gaap:CommonClassBMemberus-gaap:CommonStockMember2022-03-310001600983us-gaap:CommonClassAMemberus-gaap:CommonStockMember2022-03-310001600983us-gaap:CommonClassBMemberus-gaap:CommonStockMember2021-12-310001600983us-gaap:CommonClassAMemberus-gaap:CommonStockMember2021-12-310001600983us-gaap:CommonClassBMemberus-gaap:CommonStockMember2021-06-300001600983us-gaap:CommonClassBMemberus-gaap:CommonStockMember2021-03-310001600983us-gaap:CommonClassBMemberus-gaap:CommonStockMember2020-12-3100016009832021-01-012021-12-310001600983kscp:EquityIncentivePlan2022Memberus-gaap:CommonClassAMember2022-06-230001600983kscp:EquityIncentivePlan2016Member2016-12-310001600983kscp:EquityIncentivePlan2022Member2022-06-230001600983kscp:EquityIncentivePlan2014Member2014-04-300001600983srt:MaximumMemberus-gaap:EmployeeStockOptionMember2021-01-012021-06-300001600983us-gaap:EmployeeStockOptionMember2022-04-012022-06-300001600983srt:MinimumMemberus-gaap:EmployeeStockOptionMember2022-01-012022-06-300001600983us-gaap:EmployeeStockOptionMember2021-01-012021-06-300001600983kscp:EquityIncentivePlan2016Member2022-01-012022-06-300001600983us-gaap:TransferredOverTimeMember2022-04-012022-06-300001600983us-gaap:TransferredAtPointInTimeMember2022-04-012022-06-300001600983us-gaap:TransferredOverTimeMember2022-01-012022-06-300001600983us-gaap:TransferredAtPointInTimeMember2022-01-012022-06-300001600983us-gaap:TransferredOverTimeMember2021-04-012021-06-300001600983us-gaap:TransferredAtPointInTimeMember2021-04-012021-06-300001600983us-gaap:TransferredOverTimeMember2021-01-012021-06-300001600983us-gaap:TransferredAtPointInTimeMember2021-01-012021-06-3000016009832022-01-262022-01-260001600983kscp:UponReceiptOfUsd50000000TotalAggregateGrossCashProceedsMemberus-gaap:CommonClassAMemberkscp:StockPurchaseAgreementMember2022-04-042022-04-040001600983kscp:UponReceiptOfUsd25000000TotalAggregateGrossCashProceedsMemberus-gaap:CommonClassAMemberkscp:StockPurchaseAgreementMember2022-04-042022-04-040001600983us-gaap:CommonClassAMemberkscp:RegulationOffering2021Member2022-01-262022-01-260001600983us-gaap:RetainedEarningsMember2022-01-012022-06-300001600983kscp:KonicaMinoltaInc.Member2022-06-300001600983kscp:KonicaMinoltaInc.Member2021-12-310001600983us-gaap:ConvertibleNotesPayableMember2019-04-300001600983us-gaap:ConvertibleNotesPayableMember2021-07-010001600983us-gaap:ConvertibleNotesPayableMember2021-06-290001600983us-gaap:ConvertibleNotesPayableMember2020-12-310001600983us-gaap:ConvertibleNotesPayableMember2020-06-300001600983us-gaap:ConvertibleNotesPayableMemberkscp:SeriesSPreferredStockMember2019-04-302019-04-300001600983us-gaap:ConvertibleNotesPayableMember2019-04-302019-04-300001600983kscp:KonicaMinoltaInc.Member2022-04-012022-06-300001600983kscp:KonicaMinoltaInc.Member2022-01-012022-06-300001600983kscp:KonicaMinoltaInc.Member2021-04-012021-06-300001600983kscp:KonicaMinoltaInc.Member2021-01-012021-06-300001600983us-gaap:SeriesBPreferredStockMember2022-06-300001600983us-gaap:SeriesAPreferredStockMember2022-06-300001600983kscp:SeriesMPreferredStockMember2022-06-300001600983kscp:SeriesM2PreferredStockMember2022-06-300001600983us-gaap:ConvertibleNotesPayableMemberkscp:SeriesM4PreferredStockMember2019-09-100001600983us-gaap:ConvertibleNotesPayableMember2022-06-300001600983us-gaap:CommonClassBMember2022-06-300001600983us-gaap:CommonClassAMember2022-06-300001600983us-gaap:CommonClassBMember2021-12-310001600983us-gaap:CommonClassAMember2021-12-310001600983kscp:EquityIncentivePlan2016Member2022-06-300001600983kscp:TermLoanAgreementMemberus-gaap:CommonClassBMember2022-06-300001600983kscp:SeriesSPreferredStockMember2022-06-300001600983kscp:ClassOfWarrantsExpirationDateJuly312024Memberkscp:SeriesSPreferredStockMember2022-06-300001600983kscp:ClassOfWarrantsExpirationDateDecember312024Memberkscp:SeriesSPreferredStockMember2022-06-300001600983kscp:ClassOfWarrantsExpirationDateDecember312024Memberkscp:SeriesM3PreferredStockMember2022-06-300001600983us-gaap:ConvertibleNotesPayableMember2021-12-310001600983us-gaap:ConvertibleNotesPayableMemberkscp:SeriesSPreferredStockMember2021-11-180001600983us-gaap:ConvertibleNotesPayableMember2021-11-180001600983kscp:ProductionsLlcMemberkscp:SeriesSPreferredStockMember2019-07-230001600983us-gaap:ConvertibleNotesPayableMemberkscp:SeriesSPreferredStockMember2019-04-300001600983us-gaap:ConvertibleNotesPayableMemberkscp:SeriesM3PreferredStockMember2018-12-310001600983us-gaap:ConvertibleNotesPayableMemberkscp:SeriesM3PreferredStockMember2017-12-3100016009832020-12-310001600983us-gaap:MoneyMarketFundsMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2022-06-300001600983us-gaap:MoneyMarketFundsMemberus-gaap:FairValueMeasurementsRecurringMember2022-06-300001600983us-gaap:MoneyMarketFundsMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2021-12-310001600983us-gaap:MoneyMarketFundsMemberus-gaap:FairValueMeasurementsRecurringMember2021-12-310001600983us-gaap:EmployeeStockOptionMember2022-04-012022-06-300001600983kscp:WarrantsToPurchaseSeriesSClassPreferredStockMember2022-04-012022-06-300001600983kscp:WarrantsToPurchaseSeriesM3ClassPreferredStockMember2022-04-012022-06-300001600983us-gaap:SeriesBPreferredStockMember2022-01-012022-06-300001600983us-gaap:SeriesAPreferredStockMember2022-01-012022-06-300001600983us-gaap:EmployeeStockOptionMember2022-01-012022-06-300001600983kscp:WarrantsToPurchaseSeriesSClassPreferredStockMember2022-01-012022-06-300001600983kscp:WarrantsToPurchaseSeriesM3ClassPreferredStockMember2022-01-012022-06-300001600983kscp:SeriesSPreferredStockMember2022-01-012022-06-300001600983kscp:SeriesMPreferredStockMember2022-01-012022-06-300001600983kscp:SeriesM2PreferredStockMember2022-01-012022-06-300001600983us-gaap:SeriesBPreferredStockMember2021-04-012021-06-300001600983us-gaap:SeriesAPreferredStockMember2021-04-012021-06-300001600983us-gaap:EmployeeStockOptionMember2021-04-012021-06-300001600983us-gaap:ConvertibleDebtSecuritiesMember2021-04-012021-06-300001600983kscp:WarrantsToPurchaseSeriesSClassPreferredStockMember2021-04-012021-06-300001600983kscp:WarrantsToPurchaseSeriesM3ClassPreferredStockMember2021-04-012021-06-300001600983kscp:WarrantsToPurchaseSeriesM1ClassPreferredStockMember2021-04-012021-06-300001600983kscp:WarrantsToPurchaseSeriesBClassBPreferredStockMember2021-04-012021-06-300001600983kscp:WarrantsToPurchaseCommonStockMember2021-04-012021-06-300001600983kscp:SeriesSPreferredStockMember2021-04-012021-06-300001600983kscp:SeriesMPreferredStockMember2021-04-012021-06-300001600983kscp:SeriesM4PreferredStockMember2021-04-012021-06-300001600983kscp:SeriesM3PreferredStockMember2021-04-012021-06-300001600983kscp:SeriesM2PreferredStockMember2021-04-012021-06-300001600983us-gaap:SeriesBPreferredStockMember2021-01-012021-06-300001600983us-gaap:SeriesAPreferredStockMember2021-01-012021-06-300001600983us-gaap:EmployeeStockOptionMember2021-01-012021-06-300001600983us-gaap:ConvertibleDebtSecuritiesMember2021-01-012021-06-300001600983kscp:WarrantsToPurchaseSeriesSClassPreferredStockMember2021-01-012021-06-300001600983kscp:WarrantsToPurchaseSeriesM3ClassPreferredStockMember2021-01-012021-06-300001600983kscp:WarrantsToPurchaseSeriesM1ClassPreferredStockMember2021-01-012021-06-300001600983kscp:WarrantsToPurchaseSeriesBClassBPreferredStockMember2021-01-012021-06-300001600983kscp:WarrantsToPurchaseCommonStockMember2021-01-012021-06-300001600983kscp:SeriesSPreferredStockMember2021-01-012021-06-300001600983kscp:SeriesMPreferredStockMember2021-01-012021-06-300001600983kscp:SeriesM4PreferredStockMember2021-01-012021-06-300001600983kscp:SeriesM3PreferredStockMember2021-01-012021-06-300001600983kscp:SeriesM2PreferredStockMember2021-01-012021-06-300001600983us-gaap:ConvertibleNotesPayableMember2022-01-012022-06-300001600983us-gaap:SellingAndMarketingExpenseMember2022-04-012022-06-300001600983us-gaap:ResearchAndDevelopmentExpenseMember2022-04-012022-06-300001600983us-gaap:GeneralAndAdministrativeExpenseMember2022-04-012022-06-300001600983us-gaap:CostOfSalesMember2022-04-012022-06-300001600983us-gaap:GeneralAndAdministrativeExpenseMember2022-01-012022-06-300001600983us-gaap:SellingAndMarketingExpenseMember2021-04-012021-06-300001600983us-gaap:ResearchAndDevelopmentExpenseMember2021-04-012021-06-300001600983us-gaap:GeneralAndAdministrativeExpenseMember2021-04-012021-06-300001600983us-gaap:CostOfSalesMember2021-04-012021-06-300001600983us-gaap:GeneralAndAdministrativeExpenseMember2021-01-012021-06-300001600983us-gaap:CommonClassAMemberkscp:StockPurchaseAgreementMember2022-04-042022-04-040001600983us-gaap:CommonClassAMemberkscp:StockPurchaseAgreementMember2022-04-0400016009832022-04-042022-04-040001600983kscp:SeriesSPreferredStockMemberus-gaap:PreferredStockMember2021-04-012021-06-300001600983kscp:SeriesSPreferredStockMemberus-gaap:PreferredStockMember2021-01-012021-06-300001600983us-gaap:CommonClassBMemberus-gaap:CommonStockMember2022-04-012022-06-300001600983us-gaap:SeriesBPreferredStockMemberus-gaap:PreferredStockMember2022-04-012022-06-300001600983us-gaap:SeriesAPreferredStockMemberus-gaap:PreferredStockMember2022-04-012022-06-300001600983us-gaap:CommonClassAMemberus-gaap:CommonStockMember2022-04-012022-06-300001600983kscp:SeriesSPreferredStockMemberus-gaap:PreferredStockMember2022-04-012022-06-300001600983kscp:SeriesMPreferredStockMemberus-gaap:PreferredStockMember2022-04-012022-06-300001600983kscp:SeriesM2PreferredStockMemberus-gaap:PreferredStockMember2022-04-012022-06-300001600983us-gaap:AdditionalPaidInCapitalMember2022-04-012022-06-300001600983us-gaap:SeriesBPreferredStockMemberus-gaap:PreferredStockMember2022-01-012022-06-300001600983us-gaap:SeriesAPreferredStockMemberus-gaap:PreferredStockMember2022-01-012022-06-300001600983us-gaap:CommonClassBMemberus-gaap:CommonStockMember2022-01-012022-06-300001600983kscp:SeriesSPreferredStockMemberus-gaap:PreferredStockMember2022-01-012022-06-300001600983kscp:SeriesMPreferredStockMemberus-gaap:PreferredStockMember2022-01-012022-06-300001600983kscp:SeriesM3PreferredStockMemberus-gaap:PreferredStockMember2022-01-012022-06-300001600983kscp:SeriesM2PreferredStockMemberus-gaap:PreferredStockMember2022-01-012022-06-300001600983kscp:SeriesM1PreferredStockMemberus-gaap:PreferredStockMember2022-01-012022-06-300001600983kscp:SeriesM4PreferredStockMemberus-gaap:PreferredStockMember2021-04-012021-06-300001600983us-gaap:RetainedEarningsMember2021-04-012021-06-300001600983kscp:SeriesM4PreferredStockMemberus-gaap:PreferredStockMember2021-01-012021-06-300001600983us-gaap:RetainedEarningsMember2021-01-012021-06-300001600983us-gaap:SeriesBPreferredStockMemberus-gaap:PreferredStockMember2022-06-300001600983us-gaap:SeriesAPreferredStockMemberus-gaap:PreferredStockMember2022-06-300001600983kscp:SeriesSPreferredStockMemberus-gaap:PreferredStockMember2022-06-300001600983kscp:SeriesMPreferredStockMemberus-gaap:PreferredStockMember2022-06-300001600983kscp:SeriesM2PreferredStockMemberus-gaap:PreferredStockMember2022-06-300001600983us-gaap:SeriesBPreferredStockMemberus-gaap:PreferredStockMember2022-03-310001600983us-gaap:SeriesAPreferredStockMemberus-gaap:PreferredStockMember2022-03-310001600983kscp:SeriesSPreferredStockMemberus-gaap:PreferredStockMember2022-03-310001600983kscp:SeriesMPreferredStockMemberus-gaap:PreferredStockMember2022-03-310001600983kscp:SeriesM2PreferredStockMemberus-gaap:PreferredStockMember2022-03-310001600983us-gaap:SeriesBPreferredStockMemberus-gaap:PreferredStockMember2021-12-310001600983us-gaap:SeriesAPreferredStockMemberus-gaap:PreferredStockMember2021-12-310001600983kscp:SeriesSPreferredStockMemberus-gaap:PreferredStockMember2021-12-310001600983kscp:SeriesMPreferredStockMemberus-gaap:PreferredStockMember2021-12-310001600983kscp:SeriesM3PreferredStockMemberus-gaap:PreferredStockMember2021-12-310001600983kscp:SeriesM2PreferredStockMemberus-gaap:PreferredStockMember2021-12-310001600983kscp:SeriesM1PreferredStockMemberus-gaap:PreferredStockMember2021-12-310001600983us-gaap:SeriesBPreferredStockMemberus-gaap:PreferredStockMember2021-06-300001600983us-gaap:SeriesAPreferredStockMemberus-gaap:PreferredStockMember2021-06-300001600983kscp:SeriesSPreferredStockMemberus-gaap:PreferredStockMember2021-06-300001600983kscp:SeriesMPreferredStockMemberus-gaap:PreferredStockMember2021-06-300001600983kscp:SeriesM4PreferredStockMemberus-gaap:PreferredStockMember2021-06-300001600983kscp:SeriesM3PreferredStockMemberus-gaap:PreferredStockMember2021-06-300001600983kscp:SeriesM2PreferredStockMemberus-gaap:PreferredStockMember2021-06-300001600983us-gaap:SeriesBPreferredStockMemberus-gaap:PreferredStockMember2021-03-310001600983us-gaap:SeriesAPreferredStockMemberus-gaap:PreferredStockMember2021-03-310001600983kscp:SeriesSPreferredStockMemberus-gaap:PreferredStockMember2021-03-310001600983kscp:SeriesMPreferredStockMemberus-gaap:PreferredStockMember2021-03-310001600983kscp:SeriesM4PreferredStockMemberus-gaap:PreferredStockMember2021-03-310001600983kscp:SeriesM3PreferredStockMemberus-gaap:PreferredStockMember2021-03-310001600983kscp:SeriesM2PreferredStockMemberus-gaap:PreferredStockMember2021-03-310001600983us-gaap:SeriesBPreferredStockMemberus-gaap:PreferredStockMember2020-12-310001600983us-gaap:SeriesAPreferredStockMemberus-gaap:PreferredStockMember2020-12-310001600983kscp:SeriesSPreferredStockMemberus-gaap:PreferredStockMember2020-12-310001600983kscp:SeriesMPreferredStockMemberus-gaap:PreferredStockMember2020-12-310001600983kscp:SeriesM4PreferredStockMemberus-gaap:PreferredStockMember2020-12-310001600983kscp:SeriesM3PreferredStockMemberus-gaap:PreferredStockMember2020-12-310001600983kscp:SeriesM2PreferredStockMemberus-gaap:PreferredStockMember2020-12-310001600983us-gaap:CommonClassAMemberus-gaap:CommonStockMember2022-01-012022-06-300001600983us-gaap:ConvertibleNotesPayableMember2021-01-012021-12-310001600983us-gaap:FairValueInputsLevel3Memberus-gaap:WarrantMember2022-06-300001600983us-gaap:FairValueInputsLevel3Memberus-gaap:WarrantMember2021-12-310001600983us-gaap:FairValueInputsLevel3Memberus-gaap:WarrantMember2021-06-300001600983us-gaap:FairValueInputsLevel3Memberus-gaap:WarrantMember2020-12-310001600983us-gaap:ConvertibleNotesPayableMemberkscp:SeriesSPreferredStockMember2021-12-310001600983kscp:Mr.liMemberus-gaap:ConvertibleNotesPayableMember2022-01-012022-06-300001600983us-gaap:ConvertibleNotesPayableMember2022-01-012022-01-010001600983us-gaap:ConvertibleNotesPayableMember2021-11-182021-11-1800016009832022-04-012022-06-300001600983kscp:RegistrationRightsAgreementMember2022-04-040001600983kscp:TermLoanAgreementMember2018-05-012018-05-310001600983us-gaap:CommonClassAMemberkscp:StockPurchaseAgreementMember2022-04-012022-06-300001600983kscp:TermOfStockOptionsIfPriceOf110OfFairMarketValueMemberkscp:EquityIncentivePlan2016Member2022-01-012022-06-300001600983kscp:TermOfStockOptionsIfPriceOf100OfFairMarketValueMemberkscp:EquityIncentivePlan2016Member2022-01-012022-06-300001600983kscp:TermLoanAgreementMember2018-05-310001600983us-gaap:CommonClassAMemberkscp:RegulationOffering2021Member2021-10-152021-10-150001600983us-gaap:FairValueInputsLevel3Memberus-gaap:WarrantMember2022-01-012022-06-300001600983us-gaap:FairValueInputsLevel3Memberus-gaap:WarrantMember2021-01-012021-06-3000016009832021-06-300001600983us-gaap:ConvertibleNotesPayableMemberkscp:SeriesM3PreferredStockMember2019-09-100001600983srt:MinimumMember2022-01-012022-06-300001600983srt:MaximumMember2022-01-012022-06-300001600983srt:MinimumMember2021-01-012021-06-300001600983srt:MaximumMember2021-01-012021-06-300001600983us-gaap:SellingAndMarketingExpenseMember2022-01-012022-06-300001600983us-gaap:ResearchAndDevelopmentExpenseMember2022-01-012022-06-300001600983us-gaap:CostOfSalesMember2022-01-012022-06-300001600983us-gaap:SellingAndMarketingExpenseMember2021-01-012021-06-300001600983us-gaap:ResearchAndDevelopmentExpenseMember2021-01-012021-06-300001600983us-gaap:CostOfSalesMember2021-01-012021-06-3000016009832022-06-3000016009832021-12-310001600983us-gaap:AdditionalPaidInCapitalMember2021-04-012021-06-3000016009832021-04-012021-06-300001600983us-gaap:AdditionalPaidInCapitalMember2021-01-012021-06-3000016009832021-01-012021-06-300001600983us-gaap:AdditionalPaidInCapitalMember2022-01-012022-06-300001600983kscp:UponReceiptOfUsd50000000TotalAggregateGrossCashProceedsMemberus-gaap:CommonClassAMemberkscp:StockPurchaseAgreementMember2022-04-040001600983kscp:UponReceiptOfUsd25000000TotalAggregateGrossCashProceedsMemberus-gaap:CommonClassAMemberkscp:StockPurchaseAgreementMember2022-04-0400016009832022-08-1000016009832022-01-012022-06-30xbrli:sharesiso4217:USDxbrli:purekscp:paymentiso4217:USDxbrli:shares

Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

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

EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2022

or

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: 001-41248

Knightscope, Inc.

(Exact name of registrant as specified in its charter)

Delaware

46-2482575

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification Number)

1070 Terra Bella Avenue

Mountain View, CA 94043

(Address of Principal Executive Offices)

(650) 924-1025

(Registrant’s telephone number, including area code)

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

Title of Each Class

    

Trading symbol

    

Name of Exchange on which registered

Class A Common Stock, par value $0.001 per share

KSCP

Nasdaq Global Market

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  

As of August 10, 2022, there were 26,407,919 shares of the registrant’s Class A common stock outstanding.

Table of Contents

TABLE OF CONTENTS

Page

Part I

Financial Information

5

Item 1.

Financial Statements

5

Condensed Balance Sheets as of June 30, 2022 (Unaudited) and December 31, 2021

5

Condensed Statements of Operations for the three and six months ended June 30, 2022 and 2021 (Unaudited)

6

Condensed Statements of Stockholders’ Deficit for the three and six months ended June 30, 2022 and 2021 (Unaudited)

7-8

Condensed Statements of Cash Flows for the six months ended June 30, 2022 and 2021 (Unaudited)

9

Notes to Condensed Financial Statements (Unaudited)

10

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

24

Item 3.

Quantitative and Qualitative Disclosures about Market Risk

32

Item 4.

Controls and Procedures

32

Part II

Other Information

34

Item 1.

Legal Proceedings

34

Item 1A.

Risk Factors

34

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

34

Item 3.

Defaults Upon Senior Securities

34

Item 4.

Mine Safety Disclosures

34

Item 5.

Other Information

34

Item 6.

Exhibits

35

Signatures

36

2

Table of Contents

Cautionary Note on Forward-Looking Statements

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements contained in this Quarterly Report on Form 10-Q other than statements of historical fact, including but not limited to, statements regarding our future operating results and financial position, including projections of our future financial performance, our business strategy and plans, market growth, our objectives for future operations, industry trends, anticipated trends in our business and other characterizations of future events or circumstances are forward-looking statements. Words such as “believe,” “may,” “will,” “estimate,” “potential,” “continue,” “anticipate,” “intend,” “expect,” “could,” “would,” “project,” “plan,” “target,” and similar expressions are intended to identify forward-looking statements.

Forward-looking statements contained in this Quarterly Report on Form 10-Q include, but are not limited to, statements about:

The success of our products and product candidates will require significant capital resources and years of development efforts;
Our limited number of deployments and the risk of limited market acceptance of our products;
Our ability to protect our intellectual property and to develop, maintain and enhance a strong brand;
Our limited operating history by which performance can be gauged;
Our ability to operate and collect digital information on behalf of our clients, which is dependent on the privacy laws of jurisdictions in which our Autonomous Security Robots (“ASR”) operate, as well as the corporate policies of our clients, which may limit our ability to fully deploy our technologies in various markets;
Our ability to raise capital and the availability of future financing; and
Unpredictable events, such as the COVID-19 pandemic and resulting supply chain constraints, and associated business disruptions could seriously harm our future revenues and financial condition, delay our operations, increase our costs and expenses, and impact our ability to raise capital.

We have based these forward-looking statements on our current expectations and projections about future events and trends that we believe may affect our financial condition, results of operations, business strategy, short-term and long-term business operations and objectives, and financial needs. These forward- looking statements are subject to a number of risks, uncertainties, and assumptions and other factors that could cause actual results to differ materially from those stated, including those described in “Risk Factors” in Part I, Item 1A of our most recent Annual Report on Form 10-K, in Part II, Item 1A of this Quarterly Report on Form 10-Q, as such factors may be updated in our filings with the Securities and Exchange Commission, (“the SEC”). Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. In light of these risks, uncertainties, and assumptions, the future events and trends discussed in this Quarterly Report on Form 10-Q may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements. In particular, disruptions and delays with certain vendors in our supply chain, as a result of the COVID-19 pandemic, may adversely impact component manufacturers’ ability to meet our client demand timely. Additionally, the prioritization of shipments of certain products, as a result of the pandemic, could cause delays in our ability to deploy our ASRs. Such disruptions could result in a delay in our ability to recognize revenue on sales. The physical security industry in general and our financial position and operating results, in particular, have been material, are changing rapidly, and cannot be predicted.

3

Table of Contents

You should not rely upon forward-looking statements as predictions of future events. The events and circumstances reflected in the forward-looking statements may not be achieved or occur. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, performance, or achievements. Our forward-looking statements speak only as of the date of this Quarterly Report on Form 10-Q, and we undertake no obligation to update any of these forward-looking statements for any reason after the date of this Quarterly Report on Form 10-Q or to conform these statements to actual results or revised expectations, except as required by applicable law.

In this Quarterly Report on Form 10-Q, the words “we,” “us,” “our,” and “Knightscope” refer to Knightscope, Inc., unless the context requires otherwise.

4

Table of Contents

PART I —FINANCIAL INFORMATION

Item 1. Financial Statements

KNIGHTSCOPE, INC.

Condensed Balance Sheets

(In thousands, except share and per share data)

    

June 30, 

    

December 31, 

2022

2021

ASSETS

(Unaudited)

(1)

Current assets:

  

  

Cash and cash equivalents

$

15,639

$

10,749

Restricted cash

 

 

100

Accounts receivable (net of allowance for doubtful accounts $147 as of June 30, 2022 and $250 as of December 31, 2021)

 

1,637

 

1,189

Prepaid expenses and other current assets

 

1,255

 

1,299

Total current assets

 

18,531

 

13,337

Autonomous Security Robots, net

 

3,959

 

2,971

Property, equipment and software, net

 

172

 

117

Operating lease right-of-use-assets

 

777

 

1,077

Other assets

 

78

 

78

Total assets

$

23,517

$

17,580

LIABILITIES, PREFERRED STOCK AND STOCKHOLDERS’ DEFICIT

 

  

 

  

Current liabilities:

 

  

 

  

Accounts payable

$

1,237

$

1,514

Accrued expenses

 

585

 

1,191

Deferred revenue

 

1,544

 

889

Debt obligations

 

 

7,109

Operating lease liabilities

 

696

 

648

Other current liabilities

 

1,237

 

893

Total current liabilities

 

5,299

 

12,244

Preferred stock warrant liabilities

 

14,549

30,566

Operating lease liabilities

 

125

485

Total liabilities

 

19,973

43,295

Commitments and contingencies (Note 8)

 

  

 

  

Preferred stock, $0.001 par value; 43,405,324 shares authorized as of June 30, 2022 and December 31, 2021; 11,666,296 and 19,617,107 shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively; aggregate liquidation preference of $38,671 as of June 30, 2022

 

36,620

 

57,218

Stockholders’ deficit:

 

  

 

  

Class A common stock, $0.001 par, 114,000,000 shares authorized as of June 30, 2022 and December 31, 2021; 26,085,487 and 5,936,929 shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively

 

26

6

Class B common stock, $0.001 par, 30,000,000 shares authorized as of June 30, 2022 and December 31, 2021, 10,362,170 and 13,131,197 shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively

 

10

13

Additional paid-in capital

 

89,314

30,745

Accumulated deficit

 

(122,426)

(113,697)

Total stockholders’ deficit

 

(33,076)

(82,933)

Total liabilities, preferred stock and stockholders’ deficit

$

23,517

$

17,580

(1)

The condensed balance sheet as of December 31, 2021 was derived from the audited balance sheet as of that date.

The accompanying notes are an integral part of these condensed consolidated financial statements.

5

Table of Contents

KNIGHTSCOPE, INC.

Condensed Statements of Operations

(In thousands, except share and per share data)

(Unaudited)

Three Months Ended June 30, 

Six months ended June 30, 

    

2022

    

2021

    

2022

    

2021

Revenue, net

$

1,042

912

$

1,985

1,778

Cost of revenue, net

1,732

1,335

 

3,225

 

2,518

Gross loss

(690)

(423)

 

(1,240)

 

(740)

Operating expenses:

 

  

 

  

Research and development

2,075

1,528

 

3,913

 

2,655

Sales and marketing

1,509

3,562

 

4,998

 

6,631

General and administrative

2,960

1,120

 

5,286

 

1,665

Total operating expenses

6,544

6,210

 

14,197

 

10,951

Loss from operations

(7,234)

(6,633)

 

(15,437)

 

(11,691)

Other income (expense):

 

  

 

  

Change in fair value of warrant liabilities

8,125

(10,737)

15,647

(10,737)

Interest income (expense), net

1

(594)

(8,910)

(1,133)

Other income (expense), net

(24)

801

(29)

821

Total other income (expense)

8,102

(10,530)

6,708

(11,049)

Net income (loss) before income tax expense

868

(17,163)

(8,729)

(22,740)

Income tax (expense)

Net income (loss)

868

(17,163)

(8,729)

(22,740)

Preferred stock dividends

(184)

(359)

Net income (loss) attributable to common stockholders

$

868

(17,347)

$

(8,729)

(23,099)

Basic net income (loss) per common share

$

0.02

(1.70)

$

(0.26)

(2.27)

Diluted net income (loss) per common share

$

0.02

(1.70)

$

(0.26)

(2.27)

Weighted average shares used to compute basic net income (loss) per share

35,730,648

10,189,000

33,727,858

10,189,000

Weighted average shares used to compute diluted net income
(loss) per share

49,675,996

10,189,000

33,727,858

10,189,000

The accompanying notes are an integral part of these condensed consolidated financial statements.

6

Table of Contents

KNIGHTSCOPE, INC.

Condensed Statements of Stockholders’ Deficit

(In thousands, except share and per share data)

(Unaudited)

Series m

Series m2

    

Series m3

    

Series m4

    

Series S

    

Series A

    

Series B

    

Class B

    

Preferred

Preferred

Preferred 

Preferred 

Preferred

Preferred 

Preferred

common

Additional

Total

    

stock

stock

stock

stock

stock

stock

stock

stock

 Paid-in-

Accumulative

 Stockholders’

    

Shares

    

Amount

    

Shares

    

Amount

    

Shares

    

Amount

    

Shares

    

Amount

    

Shares

    

Amount

    

Shares

    

Amount

    

Shares

    

Amount

    

Shares

    

Amount

    

capital

    

Deficit

    

Deficit

Balance as of March 31, 2021

 

5,339,215

$

13,866

1,660,756

$

4,982

 

16,757

$

46

 

1,432,786

$

6,001

 

4,445,352

$

33,558

 

8,936,015

$

3,865

 

4,653,583

$

9,442

 

10,189,000

$

10

 

$

3,282

$

(74,998)

$

(71,706)

Stock based compensation

 

  

 

227

 

227

Warrants expired

14

14

Issuance of Series s Preferred stock, net of issuance costs

1,121,819

9,964

 

 

Series m‑4 accrued dividend

184

 

  

 

 

(184)

(184)

Net income (loss)

 

  

 

 

(17,163)

(17,163)

Balance as of June 30, 2021

5,339,215

$

13,866

1,660,756

$

4,982

16,757

$

46

 

1,432,786

$

6,185

 

5,567,171

$

43,522

 

8,936,015

$

3,865

 

4,653,583

$

9,442

 

10,189,000

$

10

 

$

3,523

$

(92,345)

$

(88,812)

Series m

Series m2

    

Series m3

    

Series m4

    

Series S

    

Series A

    

Series B

    

Class B

    

    

Preferred

Preferred

Preferred 

Preferred 

Preferred

Preferred 

Preferred

common

Additional

Total

    

stock

stock

stock

stock

stock

stock

stock

stock

 Paid-in-

Accumulative

 Stockholders’

    

Shares

    

Amount

    

Shares

    

Amount

    

Shares

    

Amount

    

Shares

    

Amount

    

Shares

    

Amount

    

Shares

    

Amount

    

Shares

    

Amount

    

Shares

    

Amount

    

capital

    

Deficit

    

Deficit

Balance as of December 31, 2020

 

5,339,215

$

13,866

1,660,756

$

4,982

 

16,757

$

46

 

1,432,786

$

5,826

 

3,731,248

$

27,135

 

8,936,015

$

3,865

 

4,653,583

$

9,442

 

10,189,000

$

10

 

$

3,051

$

(69,246)

 

$

(66,185)

Stock based compensation

  

 

  

 

458

 

  

 

458

Warrants expired

 

14

 

  

 

14

Issuance of Series s Preferred stock, net of issuance costs

1,835,923

16,387

  

 

  

 

 

  

 

  

 

Series m‑4 accrued dividend

359

  

 

  

 

 

  

(359)

 

(359)

Net income (loss)

  

 

  

 

 

  

(22,740)

 

(22,740)

Balance as of June 30, 2021

5,339,215

$

13,866

1,660,756

$

4,982

16,757

$

46

 

1,432,786

$

6,185

 

5,567,171

$

43,522

 

8,936,015

$

3,865

 

4,653,583

$

9,442

 

10,189,000

$

10

 

$

3,523

$

(92,345)

 

$

(88,812)

7

Table of Contents

Series m

Series m1

Series m2

Series m3

Series S

Series A

Series B

Class A

Class B

Preferred

Preferred

Preferred

Preferred 

Preferred

Preferred

Preferred 

common

common

Additional

Total

stock

stock

stock

stock

stock

stock

stock

stock

stock

 Paid-in-

Accumulative

 Stockholders’

  

Shares

  

Amount

  

Shares

  

Amount

  

Shares

  

Amount

  

Shares

  

Amount

  

Shares

  

Amount

  

Shares

  

Amount

  

Shares

  

Amount

  

Shares

  

Amount

  

Shares

  

Amount

  

capital

  

Deficit

  

Deficit

March 31, 2022

 

2,037,910

$

5,292

$

 

826,666

$

2,480

 

$

 

2,855,743

$

23,118

 

4,308,812

$

1,864

 

3,557,371

$

7,217

 

23,877,817

$

24

 

10,378,251

$

10

 

$

84,586

$

(123,294)

$

(38,674)