x | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 86-3078783 | |||||
(State incorporation) | (I.R.S. Employer Identification No.) | |||||
3 Ravinia Drive, Suite 500, Atlanta, GA | 30346 | |||||
( | (Zip code) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | |||||||||||||
Common stock, $0.0001 par value per share | KORE | ||||||||||||||
Large accelerated filer | o | Accelerated filer | ||||||||||||||
Non-accelerated filer | x | Smaller reporting company | ||||||||||||||
Emerging growth company |
Page | ||||||||||||
Glossary | ||||||||||||
ITEM 2. | PROPERTIES | |||||||||||
December 31, | ||||||||||||
2021 | 2020 | 2019 | ||||||||||
Revenue | $ | 248,217 | $ | 213,760 | $ | 169,152 | ||||||
Net loss | (24,453 | ) | (35,201 | ) | (23,443 | ) | ||||||
Adjusted EBITDA | 59,754 | 57,819 | 50,885 |
Line of Business | Product / Service | Product / service description | Primary pricing method | |||||||||||||||||
IoT Connectivity 73% and 66% of revenue for the years ended 2023 and 2022, respectively | IoT Connectivity as a Service (CaaS) | •IoT Connectivity services offered through our IoT platform ‘KORE One’™ •Our connectivity solutions allow devices to seamlessly and securely connect anywhere in the world across any network connected to the Internet, which we call our multiple devices, multiple locations, multiple carriers CaaS multi-value proposition | Per subscriber per month for lifetime of device (7-10 years and growing) Multi-year contracts with automatic renewals | |||||||||||||||||
IoT Connectivity Enablement as a Service (CEaaS) Not currently provided in the United States | • IoT Connectivity Management Platform as a Service (or individual KORE One engine) • Cellular Core Network as a Service (Cloud Native Evolved Packet Core “EPC”) | |||||||||||||||||||
IoT Solutions 27% and 34% of revenue for the years ended 2023 and 2022, respectively | IoT Device Management Services | • Outsourced platform-enabled services (e.g., logistics, configuration, device management) •Sourcing of third-party devices globally, device design and selection services | Upfront fee per device or per device per month | |||||||||||||||||
IoT Security Location Based Services (LBS) | •KORE’s SecurityPro® SaaS platform • KORE’s PositionLogic® SaaS platform and LBS APIs | Per subscriber per month |
revenue, respectively | Multi-year contracts with automatic renewals | |||||
Enablement as a Service (CEaaS) | ||||||
Management Services | ||||||
Based Services (LBS) | ||||||
Period | Total Number of Shares Purchased (1) | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Programs | Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program | ||||||||||||||||||||||
October 1, 2023 - October 31, 2023 | — | $ | — | — | $ | — | ||||||||||||||||||||
November 1, 2023 - November 30, 2023 | — | $ | — | — | $ | — | ||||||||||||||||||||
December 1, 2023 - December 31, 2023 | 5,001,255 | $ | 0.57 | — | $ | — |
For the Year Ended | Year-over-Year Increase / (Decrease) | ||||||||||||||||||||||
($ in thousands) | December 31, 2023 | December 31, 2022 | $ | % | |||||||||||||||||||
Services | $ | 212,645 | $ | 188,985 | $ | 23,660 | 13 | % | |||||||||||||||
Products | 63,965 | 79,462 | (15,497) | (20) | % | ||||||||||||||||||
Total Revenue | $ | 276,610 | $ | 268,447 | $ | 8,163 | 3 | % |
For the Year Ended | Year-over-Year Increase / (Decrease) | ||||||||||||||||||||||
($ in thousands) | December 31, 2023 | December 31, 2022 | $ | % | |||||||||||||||||||
IoT Connectivity | $ | 202,393 | $ | 175,942 | $ | 26,451 | 15 | % | |||||||||||||||
IoT Solutions | 74,217 | 92,505 | (18,288) | (20) | % | ||||||||||||||||||
Total Revenue | $ | 276,610 | $ | 268,447 | $ | 8,163 | 3 | % |
For the Year Ended | Year-over-Year Increase / (Decrease) | ||||||||||||||||||||||
($ in thousands) | December 31, 2023 | December 31, 2022 | $ | % | |||||||||||||||||||
Cost of services | $ | 82,547 | $ | 67,268 | $ | 15,279 | 23 | % | |||||||||||||||
Cost of products | 46,016 | 61,886 | (15,870) | (26) | % | ||||||||||||||||||
Total cost of revenue | $ | 128,563 | $ | 129,154 | $ | (591) | — | % |
For the Year Ended | |||||||||||
December 31, 2023 | December 31, 2022 | ||||||||||
Cost of services | 61.2 | % | 64.4 | % | |||||||
Cost of products | 28.1 | % | 22.1 | % | |||||||
Overall blended rate | 53.5 | % | 51.9 | % |
For the Year Ended | Year-over-Year Increase / (Decrease) | ||||||||||||||||||||||
($ in thousands) | December 31, 2023 | December 31, 2022 | $ | % | |||||||||||||||||||
Cost of IoT Connectivity | $ | 77,263 | $ | 63,051 | $ | 14,212 | 23 | % | |||||||||||||||
Cost of IoT Solutions | 51,300 | 66,103 | (14,803) | (22) | % | ||||||||||||||||||
Total cost of revenue | $ | 128,563 | $ | 129,154 | $ | (591) | — | % |
For the Year Ended | |||||||||||
December 31, 2023 | December 31, 2022 | ||||||||||
Cost of IoT Connectivity | 61.8 | % | 64.2 | % | |||||||
Cost of IoT Solutions | 30.9 | % | 28.5 | % | |||||||
Overall blended rate | 53.5 | % | 51.9 | % |
For the Year Ended | Year-over-Year Increase / (Decrease) | ||||||||||||||||||||||
($ in thousands) | December 31, 2023 | December 31, 2022 | $ | % | |||||||||||||||||||
Selling, general, and administrative expenses | $ | 129,816 | $ | 109,492 | $ | 20,324 | 19 | % |
For the Year Ended | Year-over-Year Increase / (Decrease) | ||||||||||||||||||||||
($ in thousands) | December 31, 2023 | December 31, 2022 | $ | % | |||||||||||||||||||
Selling, general, and administrative expenses incurred with affiliate | $ | 372 | $ | 2,600 | $ | (2,228) | (86) | % |
For the Year Ended December 31, | |||||||||||
(in thousands) | 2023 | 2022 | |||||||||
Net loss | $ | (167,042) | $ | (106,200) | |||||||
Income tax benefit | (4,158) | (10,417) | |||||||||
Interest expense, net | 42,680 | 31,371 | |||||||||
Depreciation and amortization | 58,363 | 54,499 | |||||||||
EBITDA | $ | (70,157) | $ | (30,747) | |||||||
Goodwill impairment loss | 78,257 | 58,074 | |||||||||
Loss on debt extinguishment | 2,584 | — | |||||||||
Change in fair value of warrant liability | 6,436 | (254) | |||||||||
Transformation expenses | 6,624 | 8,302 | |||||||||
Acquisition costs | 1,776 | 1,400 | |||||||||
Integration-related restructuring costs | 16,532 | 14,814 | |||||||||
Stock-based compensation | 11,251 | 10,296 | |||||||||
Foreign currency (gain) loss | (182) | 4 | |||||||||
Other (1) | 2,429 | 946 | |||||||||
Adjusted EBITDA | $ | 55,550 | $ | 62,835 |
December 31, 2023 | December 31, 2022 | |||||||||||||
Total Number of Connections at Period End | 18.5 | million | 15.0 | million | ||||||||||
Average Connections Count for the Period | 17.3 | million | 15.2 | million |
Years Ended December 31, | Change 2021 | |||||||||||||||
2021 | 2020 | $ | % | |||||||||||||
Services | $ | 187,962 | $ | 172,845 | $ | 15,117 | 9 | % | ||||||||
Products | 60,255 | 40,915 | 19,340 | 47 | % | |||||||||||
Total Revenue | $ | 248,217 | $ | 213,760 | $ | 34,457 | 16 | % | ||||||||
Years Ended December 31, | Change 2021 | |||||||||||||||
2021 | 2020 | $ | % | |||||||||||||
IoT Connectivity | $ | 168,804 | $ | 158,748 | $ | 10,056 | 6 | % | ||||||||
IoT Solutions | 79,413 | 55,012 | 24,401 | 44 | % | |||||||||||
Total Revenue | $ | 248,217 | $ | 213,760 | $ | 34,457 | 16 | % | ||||||||
December 31, | ||||||||
2021 | 2020 | |||||||
Period End Connections | 14.6 million | 11.8 million | ||||||
Average Connections Count for the Period | 13.4 million | 10.7 million |
Years Ended December 31, | Change 2021 | |||||||||||||||
2021 | 2020 | $ | % | |||||||||||||
Cost of services | $ | 69,867 | $ | 64,520 | $ | 5,347 | 8 | % | ||||||||
Cost of products | 52,357 | 33,410 | 18,947 | 57 | % | |||||||||||
Total cost of revenue | $ | 122,224 | $ | 97,930 | $ | 24,294 | 25 | % | ||||||||
Years Ended | ||||||||
December 31, | ||||||||
Gross margin rate | 2021 | 2020 | ||||||
Cost of services | 62.8 | % | 62.7 | % | ||||
Cost of products | 13.1 | % | 18.3 | % | ||||
Total gross margins | 50.8 | % | 54.2 | % |
Years Ended | ||||||||||||||||
December 31, | Change 2021 | |||||||||||||||
Cost of revenue | 2021 | 2020 | $ | % | ||||||||||||
Cost of IoT Connectivity | $ | 66,567 | $ | 63,706 | $ | 2,861 | 4 | % | ||||||||
Cost of IoT Solutions | 55,657 | 34,224 | 21,433 | 63 | % | |||||||||||
Total cost of revenue | $ | 122,224 | $ | 97,930 | $ | 24,294 | 25 | % | ||||||||
Years Ended | ||||||||
Gross margin rate | 2021 | 2020 | ||||||
IoT Connectivity | 60.6 | % | 59.9 | % | ||||
IoT Solutions | 29.9 | % | 37.8 | % | ||||
Total gross margins | 50.8 | % | 54.2 | % |
Years Ended | ||||||||||||||||
December 31, | Change 2021 | |||||||||||||||
2021 | 2020 | $ | % | |||||||||||||
Selling, general, and administrative | $ | 91,733 | $ | 72,883 | $ | 18,850 | 26 | % |
Years Ended | ||||||||||||||||
December 31, | Change 2021 | |||||||||||||||
2021 | 2020 | $ | % | |||||||||||||
Depreciation and amortization | $ | 50,414 | $ | 52,488 | $ | (2,074 | ) | (4 | )% |
Years Ended | ||||||||||||||||
December 31, | Change 2021 | |||||||||||||||
2021 | 2020 | $ | % | |||||||||||||
Interest expense, including amortization of deferred financing costs, net | $ | 23,260 | $ | 23,493 | $ | (233 | ) | (1 | )% | |||||||
Change in fair value of warrant liability | (5,267 | ) | 7,485 | (12,752 | ) | (170 | )% | |||||||||
Total Other (Income) Expense | $ | 17,993 | $ | 30,978 | $ | (12,985 | ) | (42 | )% | |||||||
December 31, | Change 2021 | |||||||||||||||
2021 | 2020 | $ | % | |||||||||||||
Income tax benefit | $ | (9,694 | ) | $ | (5,318 | ) | $ | (4,376 | ) | 82 | % |
For the Year Ended December 31, | |||||||||||
(in thousands) | 2023 | 2022 | |||||||||
Net loss | $ | (167,042) | $ | (106,200) | |||||||
Income tax benefit | (4,158) | (10,417) | |||||||||
Interest expense, net | 42,680 | 31,371 | |||||||||
Depreciation and amortization | 58,363 | 54,499 | |||||||||
EBITDA | $ | (70,157) | $ | (30,747) | |||||||
Goodwill impairment loss | 78,257 | 58,074 | |||||||||
Loss on debt extinguishment | 2,584 | — | |||||||||
Change in fair value of warrant liability | 6,436 | (254) | |||||||||
Transformation expenses | 6,624 | 8,302 | |||||||||
Acquisition costs | 1,776 | 1,400 | |||||||||
Integration-related restructuring costs | 16,532 | 14,814 | |||||||||
Stock-based compensation | 11,251 | 10,296 | |||||||||
Foreign currency (gain) loss | (182) | 4 | |||||||||
Other (1) | 2,429 | 946 | |||||||||
Adjusted EBITDA | $ | 55,550 | $ | 62,835 |
December 31, 2023 | December 31, 2022 | |||||||||||||
Total Number of Connections at Period End | 18.5 | million | 15.0 | million | ||||||||||
Average Connections Count for the Period | 17.3 | million | 15.2 | million |
For the Years Ended December 31, | ||||||||
2021 | 2020 | |||||||
Net loss | $ | (24,453 | ) | $ | (35,201 | ) | ||
Income tax expense (benefit) | (9,694 | ) | (5,318 | ) | ||||
Interest expense | 23,260 | 23,493 | ||||||
Depreciation and amortization | 50,414 | 52,488 | ||||||
EBITDA | 39,527 | 35,462 | ||||||
Change in Fair value of warrant liabilities (non-cash) | (5,267 | ) | 7,485 | |||||
Transformation expenses | 8,937 | 7,354 | ||||||
Acquisition and integration-related restructuring costs | 11,287 | 5,709 | ||||||
Stock-based compensation (non-cash) | 4,564 | 1,161 | ||||||
Other income tax liability reversal (non-cash) | — | 80 | ||||||
Foreign currency loss (non-cash) | 344 | 233 | ||||||
Other | 478 | 335 | ||||||
Adjusted EBITDA | $ | 59,870 | $ | 57,819 | ||||
For the Year Ended December 31, | |||||||||||
(in thousands) | 2023 | 2022 | |||||||||
Net loss | $ | (167,042) | $ | (106,200) | |||||||
Income tax benefit | (4,158) | (10,417) | |||||||||
Interest expense, net | 42,680 | 31,371 | |||||||||
Depreciation and amortization | 58,363 | 54,499 | |||||||||
EBITDA | $ | (70,157) | $ | (30,747) | |||||||
Goodwill impairment loss | 78,257 | 58,074 | |||||||||
Loss on debt extinguishment | 2,584 | — | |||||||||
Change in fair value of warrant liability | 6,436 | (254) | |||||||||
Transformation expenses | 6,624 | 8,302 | |||||||||
Acquisition costs | 1,776 | 1,400 | |||||||||
Integration-related restructuring costs | 16,532 | 14,814 | |||||||||
Stock-based compensation | 11,251 | 10,296 | |||||||||
Foreign currency (gain) loss | (182) | 4 | |||||||||
Other (1) | 2,429 | 946 | |||||||||
Adjusted EBITDA | $ | 55,550 | $ | 62,835 |
December 31, 2023 | December 31, 2022 | |||||||||||||
Total Number of Connections at Period End | 18.5 | million | 15.0 | million | ||||||||||
Average Connections Count for the Period | 17.3 | million | 15.2 | million |
December 31, | |||||||||||
(in thousands) | 2023 | 2022 | |||||||||
Term Loan - Whitehorse | $ | 185,000 | N/A | ||||||||
Term Loan – UBS | N/A | 302,654 | |||||||||
Backstop Notes | 120,000 | 120,000 | |||||||||
Other borrowings | 561 | 2,754 | |||||||||
Total | $ | 305,561 | $ | 425,408 | |||||||
Less: current portion of long-term debt | (2,411) | (5,345) | |||||||||
Less: debt issuance costs, net of accumulated amortization of $0.8 million and $8.5 million, respectively | (2,911) | (6,153) | |||||||||
Less: original issue discount | (4,130) | N/A | |||||||||
Total Long-term debt and other borrowings, net | $ | 296,109 | $ | 413,910 |
($ in thousands) | Shares | Carrying amount | |||||||||
Preferred stock, beginning of year | — | — | |||||||||
Preferred stock issued November 15, 2023 | 150,000 | $ | 150,000 | ||||||||
Preferred stock issued December 13, 2023 | 2,857 | 2,857 | |||||||||
Preferred stock issuance costs (1) | N/A | (6,087) | |||||||||
Allocation of proceeds to preferred stock (2) | N/A | (5,327) | |||||||||
Preferred stock, end of year | 152,857 | $ | 141,443 |
For the Year Ended December 31, | |||||||||||
(in thousands) | 2023 | 2022 | |||||||||
Net cash (used in) provided by operating activities | $ | (6,419) | $ | 16,356 | |||||||
Net cash used in investing activities | $ | (20,230) | $ | (62,547) | |||||||
Net cash provided by (used in) financing activities | $ | 18,906 | $ | (4,694) |
December 31, | December 31, | |||||||
2021 | 2020 | |||||||
Assets | ||||||||
Current assets | ||||||||
Cash and cash equivalents | $ | 85,976 | $ | 10,321 | ||||
Accounts receivable, net of allowances for credits and doubtful accounts of $1,800 and $2,804, at December 31, 2021, and 2020, respectively | 51,304 | 40,661 | ||||||
Inventories, net | 15,470 | 5,842 | ||||||
Income taxes receivable | 954 | 0 | ||||||
Prepaid expenses and other receivables | 7,448 | 5,429 | ||||||
Total current assets | 161,152 | 62,253 | ||||||
Non-current assets | ||||||||
Restricted cash | 367 | 372 | ||||||
Property and equipment, net | 12,240 | 13,709 | ||||||
Intangibles assets, net | 203,474 | 240,203 | ||||||
Goodwill | 381,962 | 382,749 | ||||||
Deferred tax assets | 0 | 122 | ||||||
Other long-term assets | 407 | 611 | ||||||
Total assets | $ | 759,602 | $ | 700,019 | ||||
Liabilities, temporary equity and stockholders’ equity | ||||||||
Current liabilities | ||||||||
Accounts payable | $ | 16,004 | $ | 22,978 | ||||
Accrued liabilities | 21,311 | 17,209 | ||||||
Income taxes payable | 467 | 244 | ||||||
Current portion of capital lease obligations | 191 | 856 | ||||||
Deferred revenue | 6,889 | 7,772 | ||||||
Current portion of long-term debt and other borrowings, net | 3,326 | 3,161 | ||||||
Total current liabilities | 48,188 | 52,220 | ||||||
Non-current liabilities | ||||||||
Deferred tax liabilities | 36,722 | 42,840 | ||||||
Due to related parties | 0 | 1,615 | ||||||
Warrant liability | 286 | 15,944 | ||||||
Capital lease obligations | 264 | 508 | ||||||
Long-term debt and other borrowings, net | 399,115 | 298,404 | ||||||
Other long-term liabilities | 2,884 | 4,377 | ||||||
Total liabilities | $ | 487,459 | $ | 415,908 | ||||
Commitments and contingencies (note 1 1 ) |
December 31, | |||||||||||
2023 | 2022 | ||||||||||
ASSETS | |||||||||||
Current assets: | |||||||||||
Cash | $ | 27,137 | $ | 34,645 | |||||||
Accounts receivable, net | 52,413 | 44,538 | |||||||||
Inventories, net | 8,215 | 10,051 | |||||||||
Prepaid expenses and other current assets | 14,222 | 13,986 | |||||||||
Total current assets | 101,987 | 103,220 | |||||||||
Noncurrent assets: | |||||||||||
Restricted cash | 300 | 362 | |||||||||
Property and equipment, net | 10,956 | 11,899 | |||||||||
Intangible assets, net | 167,587 | 192,504 | |||||||||
Goodwill | 294,974 | 369,706 | |||||||||
Operating lease right-of-use assets | 9,367 | 10,019 | |||||||||
Other non-current assets | 1,813 | 971 | |||||||||
Total assets | $ | 586,984 | $ | 688,681 | |||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||
Current liabilities: | |||||||||||
Accounts payable | $ | 23,983 | $ | 17,835 | |||||||
Accrued liabilities | 23,421 | 16,000 | |||||||||
Accrued interest due to affiliate | 2,530 | — | |||||||||
Current portion of operating lease liabilities | 1,446 | 1,811 | |||||||||
Deferred revenue | 9,044 | 7,817 | |||||||||
Current portion of long-term debt and other borrowings, net | 2,411 | 5,345 | |||||||||
Warrant liabilities to affiliates | 11,664 | 33 | |||||||||
Total current liabilities | 74,499 | 48,841 | |||||||||
Noncurrent liabilities: | |||||||||||
Operating lease liabilities | 9,446 | 9,275 | |||||||||
Long-term debt and other borrowings, net | 296,109 | 413,910 | |||||||||
Deferred income tax liabilities, net | 13,795 | 25,193 | |||||||||
Mandatorily redeemable preferred stock due to affiliate, net | 141,594 | — | |||||||||
Other liabilities | 14,568 | 10,790 | |||||||||
Total liabilities | 550,011 | 508,009 | |||||||||
Commitments and Contingencies | |||||||||||
Stockholders’ equity: | |||||||||||
Common stock, voting; par value $0.0001 per share; 315,000,000 shares authorized; 87,382,647 shares issued and 82,382,647 outstanding as of December 31, 2023, and 76,292,241 shares issued and outstanding as of December 31, 2022 | 8 | 8 | |||||||||
Additional paid in capital | 461,069 | 435,292 | |||||||||
Accumulated other comprehensive loss | (6,070) | (6,390) | |||||||||
Accumulated deficit | (415,280) | (248,238) | |||||||||
Treasury stock, at cost, 5,000,000 shares | (2,754) | — | |||||||||
Total stockholders’ equity | 36,973 | 180,672 | |||||||||
Total liabilities and stockholders’ equity | $ | 586,984 | $ | 688,681 |
For the Year Ended December 31, | ||||||||||||||
2023 | 2022 | |||||||||||||
Revenues | ||||||||||||||
Services | $ | 212,645 | $ | 188,985 | ||||||||||
Products | 63,965 | 79,462 | ||||||||||||
Total revenue | 276,610 | 268,447 | ||||||||||||
Cost of revenue | ||||||||||||||
Services | 82,547 | 67,268 | ||||||||||||
Products | 46,016 | 61,886 | ||||||||||||
Total cost of revenue (exclusive of depreciation and amortization shown separately below) | 128,563 | 129,154 | ||||||||||||
Operating expenses | ||||||||||||||
Selling, general, and administrative expenses | 129,816 | 109,492 | ||||||||||||
Selling, general, and administrative expenses incurred with affiliate | 372 | 2,600 | ||||||||||||
Depreciation and amortization | 58,363 | 54,499 | ||||||||||||
Goodwill impairment | 78,257 | 58,074 | ||||||||||||
Total operating expenses | 266,808 | 224,665 | ||||||||||||
Operating loss | (118,761) | (85,372) | ||||||||||||
Other expense (income) | ||||||||||||||
Interest expense, including amortization of deferred financing costs | 40,625 | 31,835 | ||||||||||||
Interest expense incurred with affiliate, including amortization of deferred financing costs | 2,607 | — | ||||||||||||
Interest income | (552) | (464) | ||||||||||||
Change in fair value of warrant liabilities to affiliates | 6,436 | (254) | ||||||||||||
Loss on extinguishment of debt | 2,584 | — | ||||||||||||
Other expense, net | 739 | 128 | ||||||||||||
Loss before income taxes | (171,200) | (116,617) | ||||||||||||
Income tax benefit | (4,158) | (10,417) | ||||||||||||
Net loss | $ | (167,042) | $ | (106,200) | ||||||||||
Loss per share: | ||||||||||||||
Basic and diluted | $ | (1.99) | $ | (1.40) | ||||||||||
Weighted average shares outstanding: | ||||||||||||||
Basic and diluted | 83,808,227 | 75,710,904 | ||||||||||||
Comprehensive loss | ||||||||||||||
Net loss | $ | (167,042) | $ | (106,200) | ||||||||||
Other comprehensive loss: | ||||||||||||||
Foreign currency translation adjustment | 320 | (2,927) | ||||||||||||
Comprehensive loss | $ | (166,722) | $ | (109,127) |
December 31, | December 31, | |||||||
2021 | 2020 | |||||||
Temporary equity | ||||||||
Series A Preferred Stock; par value $1,000 per share; NaN authorized, issued and outstanding at December 31, 2021; 7,765,229 shares authorized, and 7,756,158 shares issued and outstanding at December 31, 2020 | $ | — | $ | 77,562 | ||||
Series A-1 Preferred Stock; par value $1,000 per share; NaN authorized, issued and outstanding at December 31, 2021; 10,480,538 shares authorized, 7,862,107 shares issued and outstanding at December 31, 2020 | — | 78,621 | ||||||
Series B Preferred Stock; par value $1,000 per share; NaN authorized, issued and outstanding at December 31, 2021; 9,090,975 shares authorized, 9,090,975 shares issued and outstanding at December 31, 2020 | — | 90,910 | ||||||
Series C Convertible Preferred Stock; par value $1,000 per share; NaN authorized, issued and outstanding at December 31, 2021; 6,872,894 shares authorized, 2,566,186 shares issued and outstanding at December 31, | — | 16,802 | ||||||
Total temporary equity | $ | — | $ | 263,895 | ||||
Stockholders’ equity | ||||||||
Common stock, voting; par value $0.0001 per share; 315,000,000 shares authorized, 72,027,743 shares issued and outstanding at December 31, 2021; 55,659,643 shares authorized, 30,281,520 shares issued and outstanding at December 31, 2020 | $ | 7 | $ | 3 | ||||
Additional paid-in capital | 413,646 | 135,616 | ||||||
Accumulated other comprehensive loss | (3,331 | ) | (1,677 | ) | ||||
Accumulated deficit | (138,179 | ) | (113,726 | ) | ||||
Total stockholders’ equity | 272,143 | 20,216 | ||||||
Total liabilities, temporary equity and stockholders’ equity | $ | 759,602 | $ | 700,019 | ||||
For the Year Ended December 31, | |||||||||||
2023 | 2022 | ||||||||||
Par value of common stock | |||||||||||
Balance, beginning of year | $ | 8 | $ | 7 | |||||||
Common stock issued pursuant to acquisition | — | 1 | |||||||||
Balance, end of year | 8 | 8 | |||||||||
Additional paid-in capital | |||||||||||
Balance, beginning of year | 435,292 | 401,702 | |||||||||
Common stock issued pursuant to acquisition | 14,700 | 23,294 | |||||||||
Stock-based compensation expense | 11,251 | 10,296 | |||||||||
Stock awards cancelled for employee tax withholdings | (405) | — | |||||||||
Private offering and merger financing refund | 231 | — | |||||||||
Balance, end of year | 461,069 | 435,292 | |||||||||
Accumulated other comprehensive loss | |||||||||||
Balance, beginning of year | (6,390) | (3,463) | |||||||||
Foreign currency translation adjustment | 320 | (2,927) | |||||||||
Balance, end of year | (6,070) | (6,390) | |||||||||
Accumulated deficit | |||||||||||
Balance, beginning of year | (248,238) | (142,038) | |||||||||
Net loss | (167,042) | (106,200) | |||||||||
Balance, end of year | (415,280) | (248,238) | |||||||||
Treasury stock, at cost | |||||||||||
Balance, beginning of year | — | — | |||||||||
Purchase of treasury stock | (2,754) | — | |||||||||
Balance, end of year | (2,754) | — | |||||||||
Total Stockholders’ Equity | $ | 36,973 | $ | 180,672 |
For the years ended | December 31, | December 31, | December 31, | |||||||||
2021 | 2020 | 2019 | ||||||||||
Revenue | ||||||||||||
Services | $ | 187,962 | $ | 172,845 | $ | 159,425 | ||||||
Products | 60,255 | 40,915 | 9,727 | |||||||||
Total revenue | 248,217 | 213,760 | 169,152 | |||||||||
Cost of revenue | ||||||||||||
Cost of services | 69,867 | 64,520 | 57,621 | |||||||||
Cost of products | 52,357 | 33,410 | 6,044 | |||||||||
Total cost of revenue (exclusive of depreciation and amortization shown separately below) | 122,224 | 97,930 | 63,665 | |||||||||
Operating expenses | ||||||||||||
Selling, general and administrative | 91,733 | 72,883 | 65,298 | |||||||||
Depreciation and amortization | 50,414 | 52,488 | 48,131 | |||||||||
Intangible asset impairment loss | 0 | 0 | 3,892 | |||||||||
Total operating expenses | 142,147 | 125,371 | 117,321 | |||||||||
Operating loss | (16,154 | ) | (9,541 | ) | (11,834 | ) | ||||||
Interest expense, including amortization of deferred financing costs, net | 23,260 | 23,493 | 24,785 | |||||||||
Change in fair value of warrant liability | (5,267 | ) | 7,485 | (235 | ) | |||||||
Loss before income taxes | (34,147 | ) | (40,519 | ) | (36,384 | ) | ||||||
Income tax expense (benefit) | ||||||||||||
Current | 177 | 1,051 | (1,450 | ) | ||||||||
Deferred | (9,871 | ) | (6,369 | ) | (11,491 | ) | ||||||
Total income tax benefit | (9,694 | ) | (5,318 | ) | (12,941 | ) | ||||||
Net loss attributable to the Company | $ | (24,453 | ) | $ | (35,201 | ) | $ | (23,443 | ) | |||
Loss per share: | ||||||||||||
Basic | $ | (1.03 | ) | $ | (1.96 | ) | $ | (1.45 | ) | |||
Diluted | $ | (1.03 | ) | $ | (1.96 | ) | $ | (1.45 | ) | |||
Weighted average shares outstanding (in Number): | ||||||||||||
Basic | 41,933,050 | 31,650,173 | 31,169,435 | |||||||||
Diluted | 41,933,050 | 31,650,173 | 31,169,435 |
For the years ended | December 31, 2021 | December 31, 2020 | December 31, 2019 | |||||||||
Net loss | $ | (24,453 | ) | $ | (35,201 | ) | $ | (23,443 | ) | |||
Other comprehensive income (loss): | ||||||||||||
Foreign currency translation adjustment | (1,654 | ) | 2,116 | 517 | ||||||||
Comprehensive loss | $ | (26,107 | ) | $ | (33,085 | ) | $ | (22,926 | ) | |||
Series A Preferred Stock | Series A-1 Preferred Stock | Series B Preferred Stock | Series C Convertible Preferred Stock | Total Temporary Equity | Common Stock | Additional paid-in capital | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit | Total Stockholders’ Equity | |||||||||||||||||||||||||||||||||||||||||||||||||||
Temporary Equity | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Amount | Shares | Amount | Amount | Amount | Amount | Amount | ||||||||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2018 (as previously reported) | 42,750 | $ | 60,270 | 60,013 | $ | 61,444 | 57,000 | $ | 76,832 | 16,802 | $ | 16,802 | $ | 215,348 | 213,756 | $ | 2 | $ | 174,601 | $ | (4,310 | ) | $ | (55,082 | ) | $ | 115,211 | |||||||||||||||||||||||||||||||||
Conversion of Stock | 5,984,277 | — | 6,084,419 | — | 7,626,175 | — | 2,549,384 | — | — | 29,530,231 | 1 | (1 | ) | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2018, effect of reverse recapitalization | 6,027,027 | $ | 60,270 | 6,144,432 | $ | 61,444 | 7,683,175 | $ | 76,832 | 2,566,186 | $ | 16,802 | $ | 215,348 | 29,743,987 | $ | 3 | $ | 174,600 | $ | (4,310 | ) | $ | (55,082 | ) | $ | 115,211 | |||||||||||||||||||||||||||||||||
Issuance of stock | — | — | — | — | — | — | — | — | — | 573,016 | — | 7,000 | — | — | 7,000 | |||||||||||||||||||||||||||||||||||||||||||||
Repurchase and cancellation of stock | — | — | — | — | — | — | — | — | — | (7,653 | ) | — | (80 | ) | — | — | (80 | ) | ||||||||||||||||||||||||||||||||||||||||||
Accrued dividends payable | 808,976 | 8,090 | 805,092 | 8,051 | 550,599 | 5,506 | — | — | 21,647 | — | — | (21,647 | ) | — | — | (21,647 | ) | |||||||||||||||||||||||||||||||||||||||||||
Foreign currency translation adjustment | — | — | — | — | — | — | — | — | — | — | — | — | 517 | — | 517 | |||||||||||||||||||||||||||||||||||||||||||||
Share-based compensation | — | — | — | — | — | — | — | — | — | — | — | 1,682 | — | — | 1,682 | |||||||||||||||||||||||||||||||||||||||||||||
Net loss | — | — | — | — | — | — | — | — | — | — | — | — | — | (23,443 | ) | (23,443 | ) | |||||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2019 | 6,836,003 | $ | 68,360 | 6,949,524 | $ | 69,495 | 8,233,774 | $ | 82,338 | 2,566,186 | $ | 16,802 | $ | 236,995 | 30,309,350 | $ | 3 | $ | 161,555 | $ | (3,793 | ) | $ | (78,525 | ) | $ | 79,240 | |||||||||||||||||||||||||||||||||
Repurchase and cancellation of stock | — | — | — | — | — | — | — | — | — | (27,830 | ) | — | (200 | ) | — | — | (200 | ) | ||||||||||||||||||||||||||||||||||||||||||
Accrued dividends payable | 920,155 | 9,202 | 912,583 | 9,126 | 857,201 | 8,572 | — | — | 26,900 | — | — | (26,900 | ) | — | — | (26,900 | ) | |||||||||||||||||||||||||||||||||||||||||||
Foreign currency translation adjustment | — | — | — | — | — | — | — | — | — | — | — | — | 2,116 | — | 2,116 | |||||||||||||||||||||||||||||||||||||||||||||
Share-based compensation | — | — | — | — | — | — | — | — | — | — | — | 1,161 | — | — | 1,161 | |||||||||||||||||||||||||||||||||||||||||||||
Net loss | — | — | — | — | — | — | — | — | — | — | — | — | — | (35,201 | ) | (35,201 | ) | |||||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2020 | 7,756,158 | $ | 77,562 | 7,862,107 | $ | 78,621 | 9,090,975 | $ | 90,910 | 2,566,186 | $ | 16,802 | $ | 263,895 | 30,281,520 | $ | 3 | $ | 135,616 | $ | (1,677 | ) | $ | (113,726 | ) | $ | 20,216 | |||||||||||||||||||||||||||||||||
Derecognition of shares | — | — | — | — | — | — | (45,818 | ) | (300 | ) | (300 | ) | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
Accrued dividends payable | 765,609 | 7,656 | 824,076 | 8,241 | 692,543 | 6,925 | — | — | 22,822 | — | — | (22,822 | ) | — | — | (22,822 | ) | |||||||||||||||||||||||||||||||||||||||||||
Foreign currency translation adjustment | — | — | — | — | — | — | — | — | — | — | — | — | (1,654 | ) | — | (1,654 | ) | |||||||||||||||||||||||||||||||||||||||||||
Share-based compensation | — | — | — | — | — | — | — | — | — | 200,426 | — | (1,856 | ) | — | — | (1,856 | ) | |||||||||||||||||||||||||||||||||||||||||||
Distributions to and conversions of preferred stock | (8,521,767 | ) | (85,218 | ) | (8,686,183 | ) | (86,862 | ) | (9,783,518 | ) | (97,835 | ) | (2,520,368 | ) | (16,502 | ) | (286,417 | ) | 7,120,368 | 1 | 56,502 | — | — | 56,503 | ||||||||||||||||||||||||||||||||||||
CTAC shares recapitalized, net of equity issuance costs of $15,943 | — | — | — | — | — | — | — | — | — | 10,373,491 | 1 | 6,428 | — | — | 6,460 | |||||||||||||||||||||||||||||||||||||||||||||
Conversion of KORE warrants | — | — | — | — | — | — | — | — | — | 1,365,612 | — | 10,663 | — | — | 10,663 | |||||||||||||||||||||||||||||||||||||||||||||
Private offering and merger financing, net of equity issuance costs of $8,123 | — | — | — | — | — | — | — | — | — | 22,686,326 | 2 | 216,875 | — | — | 217,126 | |||||||||||||||||||||||||||||||||||||||||||||
Equity portion of convertible debt, net of deferred financing costs of $ 384 , net of sponsor shares of $683, net of deferred tax liability of $3,999 | — | — | — | — | — | — | — | — | — | — | — | 12,240 | — | — | 11,960 | |||||||||||||||||||||||||||||||||||||||||||||
Net loss | — | — | — | — | — | — | — | — | — | — | — | — | — | (24,453 | ) | (24,453 | ) | |||||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2021 | 0 | $ | 0 | 0 | $ | 0 | 0 | $ | 0 | 0 | $ | 0 | $ | 0 | 72,027,743 | $ | 7 | $ | 413,646 | $ | (3,331 | ) | $ | (138,179 | ) | $ | 272,143 | |||||||||||||||||||||||||||||||||
For the Year Ended | |||||||||||
2023 | 2022 | ||||||||||
Operating activities: | |||||||||||
Net loss | $ | (167,042) | $ | (106,200) | |||||||
Adjustments to reconcile net loss to net cash (used in) provided by operating activities | |||||||||||
Depreciation and amortization | 58,363 | 54,499 | |||||||||
Amortization of deferred financing costs | 2,204 | 2,427 | |||||||||
Loss on extinguishment of debt | 2,584 | — | |||||||||
Goodwill impairment | 78,257 | 58,074 | |||||||||
Stock-based compensation expense | 11,251 | 10,296 | |||||||||
Deferred income taxes | (11,412) | (16,189) | |||||||||
Change in fair value of warrant liabilities to affiliates | 6,436 | (254) | |||||||||
Amortization of operating lease right-of-use assets | 2,331 | 2,218 | |||||||||
Other | 100 | 429 | |||||||||
Changes in operating assets and liabilities, net of acquisitions: | |||||||||||
Accounts receivable | (7,707) | 8,962 | |||||||||
Inventories | 1,973 | 6,542 | |||||||||
Prepaid expenses and other assets | (87) | (1,992) | |||||||||
Accounts payable and accrued liabilities | 12,968 | (1,968) | |||||||||
Accrued interest due to affiliate | 2,530 | — | |||||||||
Deferred revenue | 1,175 | 980 | |||||||||
Operating lease liabilities | (1,847) | (1,468) | |||||||||
Other assets and liabilities | 1,504 | — | |||||||||
Net cash (used in) provided by operating activities | $ | (6,419) | $ | 16,356 | |||||||
Investing activities: | |||||||||||
Purchases of property and equipment | (4,433) | (3,307) | |||||||||
Additions to intangible assets | (15,797) | (13,238) | |||||||||
Acquisitions of business combinations, net of cash acquired | — | (46,002) | |||||||||
Net cash used in investing activities | $ | (20,230) | $ | (62,547) | |||||||
Financing activities: | |||||||||||
Proceeds from issuance of debt | 185,000 | — | |||||||||
Payment of original issue discount | (4,200) | — | |||||||||
Payment of deferred financing costs | (6,853) | (356) | |||||||||
Repayment of debt | (304,847) | (4,188) | |||||||||
Proceeds from mandatorily redeemable preferred stock due to affiliate | 152,857 | — | |||||||||
Purchase of treasury stock | (2,754) | — | |||||||||
Principal payments under finance lease obligations | (123) | (150) | |||||||||
Private offering and merger financing refund | 231 | — | |||||||||
Payment of employee tax withholdings through cancelled shares of stock | (405) | — | |||||||||
Net cash provided by (used in) financing activities | $ | 18,906 | $ | (4,694) | |||||||
Effect of exchange rate changes on cash | $ | 173 | $ | (451) | |||||||
Net decrease in cash and restricted cash | $ | (7,570) | $ | (51,336) | |||||||
Cash and restricted cash, beginning of year | $ | 35,007 | $ | 86,343 | |||||||
Cash and restricted cash, end of year | $ | 27,437 | $ | 35,007 | |||||||
Supplemental cash flow information: | |||||||||||
Cash paid for interest | $ | 35,330 | $ | 29,199 | |||||||
Cash paid for income taxes (net of refunds) | $ | 5,718 | $ | 2,119 | |||||||
Non-cash investing and financing activities: | |||||||||||
Fair value of KORE common stock issued pursuant to acquisition | $ | 14,700 | $ | 23,295 | |||||||
Issuance of penny warrants | $ | 5,195 | $ | — | |||||||
Operating lease right-of-use assets obtained in exchange for new operating lease liabilities | $ | 1,636 | $ | 3,409 | |||||||
ASU 2020-06 Adoption | $ | — | $ | 15,163 | |||||||
Operating lease right-of-use assets obtained in exchange for new operating lease liabilities upon the adoption of ASC 842 | $ | — | $ | 9,604 | |||||||
Premium finance agreement | $ | — | $ | 3,621 | |||||||
For the years ended | December 31, 2021 | December 31, 2020 | December 31, 2019 | |||||||||
Cash flows from operating activities | ||||||||||||
Net loss | $ | (24,453 | ) | $ | (35,201 | ) | $ | (23,443 | ) | |||
Adjustments to reconcile net loss to net cash (used in) provided by operating activities | ||||||||||||
Depreciation and amortization | 50,414 | 52,488 | 48,131 | |||||||||
Intangible asset impairment loss | — | — | 3,892 | |||||||||
Amortization of deferred financing costs | 2,097 | 2,313 | 2,063 | |||||||||
Amortization of discount on Backstop Notes | 424 | — | — | |||||||||
Deferred income taxes | (9,871 | ) | (6,178 | ) | (11,419 | ) | ||||||
Non-cash foreign currency loss | 344 | 233 | 1,440 | |||||||||
Share-based compensation | 4,564 | 1,161 | 1,682 | |||||||||
Provision for doubtful accounts | 322 | 640 | 905 | |||||||||
Change in fair value of warrant liability | (5,267 | ) | 7,485 | (235 | ) | |||||||
Settlement gain on carrier commitment liability | — | — | (2,269 | ) | ||||||||
Change in operating assets and liabilities, net of operating assets and liabilities acquired: | ||||||||||||
Accounts receivable | (11,884 | ) | (6,072 | ) | 860 | |||||||
Inventories | (9,875 | ) | (3,027 | ) | (566 | ) | ||||||
Prepaid expenses and other receivables | (1,700 | ) | (2,020 | ) | 169 | |||||||
Accounts payable and accrued liabilities | (8,371 | ) | 13,100 | (2,458 | ) | |||||||
Deferred revenue | (805 | ) | 1,583 | (44 | ) | |||||||
Income taxes payable | (697 | ) | (34 | ) | (1,158 | ) | ||||||
Change in minimum carrier commitment liability | — | — | (3,297 | ) | ||||||||
Cash (used in) provided by operating activities | $ | (14,758 | ) | $ | 26,471 | $ | 14,253 | |||||
Cash flows used in investing activities | ||||||||||||
Additions to intangible assets | (9,247 | ) | (10,135 | ) | (10,491 | ) | ||||||
Additions to property and equipment | (4,172 | ) | (1,834 | ) | (2,391 | ) | ||||||
Acquisition of Integron LLC, net of cash acquired | — | 366 | (37,488 | ) | ||||||||
Net cash used in investing activities | $ | (13,419 | ) | $ | (11,603 | ) | $ | (50,370 | ) | |||
Cash flows from financing activities | ||||||||||||
Proceeds from revolving credit facility | 25,000 | — | 8,135 | |||||||||
Repayment on revolving credit facility | (25,000 | ) | (8,300 | ) | — | |||||||
Repayment of term loan | (3,161 | ) | (3,526 | ) | (2,888 | ) | ||||||
Repayment of other borrowings - notes payable | (173 | ) | — | — | ||||||||
Proceeds from term loan | — | — | 35,000 | |||||||||
Proceeds from convertible debt | 104,167 | 0 | 0 | |||||||||
Proceeds from equity portion of convertible debt, net of issuance costs | 15,697 | — | — | |||||||||
Payment of deferred financing costs | (1,579 | ) | — | (2,089 | ) | |||||||
Repayment of related party note | (1,538 | ) | — | — | ||||||||
Repurchase of common stock | — | (200 | ) | (80 | ) | |||||||
Proceeds from CTAC and PIPE financing, net of issuance costs | 223,688 | — | — | |||||||||
Settlements of preferred shares | (229,915 | ) | — | — | ||||||||
Payment of capital lease obligations | (828 | ) | (692 | ) | (1,080 | ) | ||||||
Payment of stock option share employee withholding taxes | (2,305 | ) | — | — | ||||||||
Cash provided by/(used in) financing activities | $ | 104,053 | $ | (12,718 | ) | $ | 36,998 | |||||
Effect of Exchange Rate Change on Cash and Cash Equivalents | (226 | ) | (149 | ) | (162 | ) | ||||||
Change in Cash and Cash Equivalents and Restricted Cash | 75,650 | 2,001 | 719 | |||||||||
Cash and Cash Equivalents and Restricted Cash, beginning of period | 10,693 | 8,692 | 7,973 | |||||||||
Cash and Cash Equivalents and Restricted Cash, end of period | $ | 86,343 | $ | 10,693 | $ | 8,692 |
For the years ended | 2021 | 2020 | 2019 | |||||||||
Non-cash investing and financing activities: | ||||||||||||
Equity issued for acquisition of Integron LLC | $ | — | $ | — | $ | 7,000 | ||||||
Equity financing fees accrued | 3,602 | — | — | |||||||||
Capital leases | 0 | 622 | 1,120 | |||||||||
Common shares issued to preferred shareholders | 56,502 | — | — | |||||||||
Equity financing fees settled in common shares | 1,863 | — | — | |||||||||
Common shares issued to warrant holders | 10,663 | — | — | |||||||||
Common shares issued to option holders pursuant to the Cancellation Agreements | 1,072 | — | — | |||||||||
Sponsor shares distributed to lender under Backstop Agreement | 683 | — | — | |||||||||
Supplemental cash flow information: | ||||||||||||
Interest paid | $ | 19,874 | $ | 21,544 | $ | 23,977 | ||||||
Taxes paid (net of refunds) | 957 | 379 | 417 |
Previous Filings | After Correction | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
(unaudited) | (unaudited) | (unaudited) | (unaudited) | |||||||||||||
Three months Ended September 30, | ||||||||||||||||
Net loss attributable to common shareholders | $ | (8,331 | ) | $ | (12,787 | ) | $ | (8,331 | ) | $ | (12,787 | ) | ||||
Loss per share: | ||||||||||||||||
Basic | $ | (0.27 | ) | $ | (0.42 | ) | $ | (0.26 | ) | $ | (0.40 | ) | ||||
Diluted | $ | (0.27 | ) | $ | (0.42 | ) | $ | (0.26 | ) | $ | (0.40 | ) | ||||
Weighted-average shares outstanding: | ||||||||||||||||
Basic | 30,732,921 | 30,281,520 | 32,098,715 | 31,647,131 | ||||||||||||
Diluted | 30,732,921 | 30,281,520 | 32,098,715 | 31,647,131 |
Previous Filings | After Correction | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
(unaudited) | (unaudited) | (unaudited) | (unaudited) | |||||||||||||
Nine months Ended September 30, | ||||||||||||||||
Net loss attributable to common shareholders | $ | (31,222 | ) | $ | (39,966 | ) | $ | (31,222 | ) | $ | (39,966 | ) | ||||
Net loss per share | ||||||||||||||||
Basic | $ | (1.03 | ) | $ | (1.32 | ) | $ | (0.98 | ) | $ | (1.26 | ) | ||||
Diluted | $ | (1.03 | ) | $ | (1.32 | ) | $ | (0.98 | ) | $ | (1.26 | ) | ||||
Weighted-average shares outstanding: | ||||||||||||||||
Basic | 30,433,641 | 30,285,684 | 31,799,313 | 31,651,295 | ||||||||||||
Diluted | 30,433,641 | 30,285,684 | 31,799,313 | 31,651,295 |
For the Year Ended December 31, | |||||||||||
(in thousands) | 2023 | 2022 | |||||||||
Services: | |||||||||||
IoT Connectivity (1) | $ | 200,066 | $ | 173,526 | |||||||
IoT Solutions | 12,579 | 15,459 | |||||||||
$ | 212,645 | $ | 188,985 | ||||||||
Products: | |||||||||||
Hardware (2)(3) | $ | 63,965 | $ | 79,462 | |||||||
Total | $ | 276,610 | $ | 268,447 |
For the Year Ended December 31, | |||||||||||
(in thousands) | 2023 | 2022 | |||||||||
United States | $ | 223,172 | $ | 211,599 | |||||||
Other countries | 53,438 | 56,848 | |||||||||
Total | $ | 276,610 | $ | 268,447 |
(in thousands) | December 31, 2023 | ||||
Beginning balance | $ | — | |||
Revenue recognized during the period but not billed (2) | 2,173 | ||||
Amounts reclassified to accounts receivable | — | ||||
Ending balance | $ | 2,173 |
December 31, | |||||||||||
(in thousands) | 2023 | 2022 | |||||||||
Beginning balance | $ | 7,817 | $ | 6,889 | |||||||
Amounts billed but not recognized as revenue | 9,041 | 7,814 | |||||||||
Revenue recognized from balances held at the beginning of the period | (7,817) | (6,889) | |||||||||
Foreign exchange | 3 | 3 | |||||||||
Ending balance | $ | 9,044 | $ | 7,817 |
Year ended December 31, | ||||||||||||
(in ‘000) | 2021 | 2020 | 2019 | |||||||||
Connectivity* | $ | 164,392 | $ | 152,996 | $ | 147,927 | ||||||
Hardware Sales | 54,898 | 29,601 | 8,767 | |||||||||
Hardware Sales - bill-and-hold | 5,357 | 11,314 | 960 | |||||||||
Deployment services, professional services, and other | 23,570 | 19,849 | 11,498 | |||||||||
Total | $ | 248,217 | $ | 213,760 | $ | 169,152 |
(in thousands) | Fair Value | ||||
Fair value of KORE common stock issued to sellers (10,000,000 shares) | $ | 14,700 | |||
Total consideration | $ | 14,700 | |||
Assets acquired: | |||||
Intangible assets | $ | 11,500 | |||
Inventories | 326 | ||||
Property and equipment | 36 | ||||
Total Assets acquired | $ | 11,862 | |||
Liabilities assumed: | |||||
Accrued liabilities | $ | 405 | |||
Total liabilities assumed | $ | 405 | |||
Net identifiable assets acquired | 11,457 | ||||
Goodwill (excess of consideration transferred over net identifiable assets acquired) | $ | 3,243 |
Shares | Percentage | |||||||
Pre-combination KORE shareholders | 38,767,500 | 54.0 | % | |||||
Public stockholders | 10,356,593 | 14.4 | % | |||||
Private offering and merger financing | 22,686,326 | 31.6 | % | |||||
Total | 71,810,419 | 100.0 | % | |||||
(in ‘000) | Amount | |||
Cash paid to sellers | $ | 37,500 | ||
Common stock issued to sellers | 7,000 | |||
Total consideration | $ | 44,500 | ||
Cash | 12 | |||
Accounts receivable | 7,776 | |||
Inventories | 489 | |||
Prepaid expenses and other receivables | 341 | |||
Property and equipment | 458 | |||
Identifiable intangible assets | 32,000 | |||
Deferred tax liabilities | (1,285 | ) | ||
Accounts payable and accrued liabilities | (1,818 | ) | ||
Net identifiable assets acquired | 37,973 | |||
Goodwill (excess of consideration transferred over net identifiable assets acquired) | $ | 6,527 | ||
(in thousands) | Fair Value | ||||
Cash, (net of closing cash of $1,995) and working capital adjustments | $ | 46,002 | |||
Fair value of KORE Common Stock issued to sellers (4,212,246 shares) | 23,295 | ||||
Total consideration | $ | 69,297 | |||
Assets acquired: | |||||
Intangible assets | $ | 28,664 | |||
Accounts receivable | 3,303 | ||||
Inventories | 1,323 | ||||
Prepaid expenses and other receivables | 976 | ||||
Property and equipment | 201 | ||||
Total assets acquired | $ | 34,467 | |||
Liabilities assumed: | |||||
Deferred tax liabilities | $ | 7,391 | |||
Accounts payable and accrued liabilities | 2,638 | ||||
Total liabilities assumed | $ | 10,029 | |||
Net identifiable assets acquired | 24,438 | ||||
Goodwill (excess of consideration transferred over net identifiable assets acquired) | $ | 44,859 |
December 31, | |||||||||||
(in thousands) | 2023 | 2022 | |||||||||
Accounts receivable | $ | 52,843 | $ | 45,097 | |||||||
Less: allowance for credit losses | (430) | (559) | |||||||||
Accounts receivable, net | $ | 52,413 | $ | 44,538 |
December 31, | |||||||||||
(in thousands) | 2023 | 2022 | |||||||||
Computer hardware | $ | 16,381 | $ | 17,684 | |||||||
Computer software | 8,764 | 9,547 | |||||||||
Networking equipment | 7,775 | 7,715 | |||||||||
Leasehold improvements | 3,451 | 3,017 | |||||||||
Furniture and fixtures | 1,930 | 2,550 | |||||||||
Property and equipment | $ | 38,301 | $ | 40,513 | |||||||
Less: accumulated depreciation and amortization | (27,345) | (28,614) | |||||||||
Property and equipment, net | $ | 10,956 | $ | 11,899 |
December 31, | ||||||||||||||
(in thousands) | Classification on Consolidated Balance Sheets | 2023 | 2022 | |||||||||||
Noncurrent assets: | ||||||||||||||
Operating lease right-of-use assets | Operating lease right-of-use assets | $ | 9,367 | $ | 10,019 | |||||||||
Finance lease right-of-use assets | Property and equipment, net | 127 | 250 | |||||||||||
Total | $ | 9,494 | $ | 10,269 | ||||||||||
Current liabilities: | ||||||||||||||
Operating lease liabilities | Current portion of operating lease liabilities | $ | 1,446 | $ | 1,811 | |||||||||
Finance lease liabilities | Accrued liabilities | 106 | 115 | |||||||||||
Noncurrent liabilities: | ||||||||||||||
Operating lease liabilities | Noncurrent portion of operating lease liabilities | 9,446 | 9,275 | |||||||||||
Finance lease liabilities | Other noncurrent liabilities | 21 | 135 | |||||||||||
Total | $ | 11,019 | $ | 11,336 |
For the Year Ended December 31, | ||||||||||||||
(in thousands) | Classification on Statement of Operations | 2023 | 2022 | |||||||||||
Operating lease cost | Selling, general, and administrative expenses | $ | 4,120 | $ | 3,531 | |||||||||
Finance lease cost: | ||||||||||||||
Amortization of leased assets | Depreciation and amortization | $ | 241 | $ | 350 | |||||||||
Interest on lease liabilities | Interest expense | 9 | 17 | |||||||||||
Total finance lease cost | $ | 250 | $ | 367 |
December 31, | ||||||||||||||
2023 | 2022 | |||||||||||||
Weighted average remaining lease term: | ||||||||||||||
Operating leases | 7.1 years | 7.7 years | ||||||||||||
Finance leases | 1.1 years | 2.1 years | ||||||||||||
Weighted average discount rate: | ||||||||||||||
Operating leases | 8.0 | % | 7.6 | % | ||||||||||
Finance leases | 5.6 | % | 5.5 | % |
(in thousands) | Operating Leases | Finance Leases | ||||||||||||
2024 | $ | 2,229 | $ | 109 | ||||||||||
2025 | 2,079 | 25 | ||||||||||||
2026 | 1,809 | — | ||||||||||||
2027 | 1,832 | — | ||||||||||||
2028 | 1,672 | — | ||||||||||||
Thereafter | 4,859 | — | ||||||||||||
Total minimum lease payments | $ | 14,480 | $ | 134 | ||||||||||
Interest | (3,588) | (7) | ||||||||||||
Total | $ | 10,892 | $ | 127 |
(in thousands) | December 31, 2023 | ||||
Selling profit | $ | 2,640 | |||
Interest income (2) | $ | 40 |
(in thousands) | December 31, 2023 | ||||
2024 | $ | 989 | |||
2025 | 988 | ||||
2026 | 787 | ||||
Total future minimum receipts | $ | 2,764 | |||
Less: unearned interest income | (285) | ||||
Net investment in sales-type lease | $ | 2,479 |
(in ‘000) | December 31, 2021 | December 31, 2020 | ||||||
Computer hardware | $ | 15,747 | $ | 13,634 | ||||
Computer software | 9,023 | 8,211 | ||||||
Furniture and fixtures | 2,242 | 2,284 | ||||||
Networking equipment | 8,089 | 8,151 | ||||||
Leasehold improvements | 2,793 | 2,803 | ||||||
Total property and equipment | 37,894 | 35,083 | ||||||
Less: accumulated depreciation | (25,654 | ) | (21,374 | ) | ||||
Property and equipment (net) | $ | 12,240 | $ | 13,709 | ||||
(in thousands) | Total | ||||
Goodwill, gross | $ | 384,202 | |||
Accumulated currency translation | (787) | ||||
Balance as of January 1, 2022, net | $ | 383,415 | |||
Acquisitions during the year | 44,859 | ||||
Impairment losses | (58,074) | ||||
Currency translation | (494) | ||||
(13,709) | |||||
Goodwill, gross | $ | 429,061 | |||
Accumulated impairment losses | (58,074) | ||||
Accumulated currency translation | (1,281) | ||||
Balance as of December 31, 2022, net | $ | 369,706 | |||
Acquisitions during the year | 3,243 | ||||
Impairment losses | (78,257) | ||||
Currency translation | 282 | ||||
(74,732) | |||||
Goodwill, gross | $ | 432,304 | |||
Accumulated impairment losses | (136,331) | ||||
Accumulated currency translation | (999) | ||||
Balance as of December 31, 2023, net | $ | 294,974 |
(in thousands) | Gross Carrying Value | Accumulated Amortization | Net Carrying Value | ||||||||||||||
Customer relationships | $ | 334,543 | $ | (227,456) | $ | 107,087 | |||||||||||
Internally developed computer software | 82,950 | (47,166) | 35,784 | ||||||||||||||
Carrier contracts | 70,210 | (54,561) | 15,649 | ||||||||||||||
Technology | 50,366 | (45,978) | 4,388 | ||||||||||||||
Trademarks | 17,449 | (12,918) | 4,531 | ||||||||||||||
Non-compete agreement | 5,604 | (5,456) | 148 | ||||||||||||||
Balance as of December 31, 2023 | $ | 561,122 | $ | (393,535) | $ | 167,587 |
(in thousands) | Gross Carrying Value | Accumulated Amortization | Net Carrying Value | ||||||||||||||
Customer relationships | $ | 327,317 | $ | (197,483) | $ | 129,834 | |||||||||||
Internally developed computer software | 66,459 | (36,579) | 29,880 | ||||||||||||||
Carrier contracts | 70,210 | (47,483) | 22,727 | ||||||||||||||
Technology | 46,978 | (42,348) | 4,630 | ||||||||||||||
Trademarks | 16,214 | (11,060) | 5,154 | ||||||||||||||
Non-compete agreement | 5,604 | (5,325) | 279 | ||||||||||||||
Balance as of December 31, 2022 | $ | 532,782 | $ | (340,278) | $ | 192,504 |
(in ‘000) | Amount | |||
December 31, 2019 | $ | 382,247 | ||
Measurement period adjustment — Integron | (366 | ) | ||
Currency translation | 868 | |||
December 31, 2020 | $ | 382,749 | ||
Currency translation | (787 | ) | ||
December 31, 2021 | $ | 381,962 | ||
(in ‘000) | Carrying Gross Amount | Accumulated Amortization | Net Carrying Value | |||||||||
Customer relationships | $ | 306,732 | $ | (168,679 | ) | $ | 138,053 | |||||
Technology | 45,983 | (37,529 | ) | 8,454 | ||||||||
Carrier contracts | 65,700 | (40,488 | ) | 25,212 | ||||||||
Trademarks | 15,733 | (9,221 | ) | 6,512 | ||||||||
Internally developed computer software | 59,906 | (34,663 | ) | 25,243 | ||||||||
Total as of December 31, 2021 | $ | 494,054 | $ | (290,580 | ) | $ | 203,474 | |||||
(in ‘000) | Carrying Gross Amount | Accumulated Amortization | Net Carrying Value | |||||||||
Customer relationships | $ | 307,356 | $ | (143,230 | ) | $ | 164,126 | |||||
Technology | 46,229 | (33,394 | ) | 12,835 | ||||||||
Carrier contracts | 65,700 | (33,918 | ) | 31,782 | ||||||||
Trademarks | 15,828 | (7,608 | ) | 8,220 | ||||||||
Internally developed computer software | 45,148 | (21,908 | ) | 23,240 | ||||||||
Total as of December 31, 2020 | $ | 480,261 | $ | (240,058 | ) | $ | 240,203 | |||||
(in thousands) | Estimated Amortization Expense | ||||
2024 | $ | 51,305 | |||
2025 | 47,269 | ||||
2026 | 33,273 | ||||
2027 | 13,053 | ||||
2028 | 10,156 | ||||
Thereafter | 12,531 | ||||
Total | $ | 167,587 |
Amount | ||||
2022 | $ | 46,788 | ||
2023 | 43,223 | |||
2024 | 39,132 | |||
2025 | 36,359 | |||
2026 | 22,350 | |||
Thereafter | 15,622 | |||
Total | $ | 203,474 | ||
(in ‘000) | December 31, 2021 | December 31, 2020 | ||||||
Accrued payroll and related | $ | 13,103 | $ | 10,657 | ||||
Accrued cost of revenue | 1,641 | 2,142 | ||||||
Accrued other expenses | 5,198 | 3,845 | ||||||
Sales and other taxes payable | 1,369 | 565 | ||||||
Total accrued liabilities | $ | 21,311 | $ | 17,209 | ||||
(in ‘000) | December 31, 2021 | December 31, 2020 | ||||||
Term Loan – UBS | $ | 305,807 | $ | 308,959 | ||||
Term Loan – BNP Paribas | 0 | 9 | ||||||
Notes under the Backstop Agreement | 120,000 | — | ||||||
Other Borrowings | 173 | — | ||||||
Total | 425,980 | 308,968 | ||||||
Less — current portion | 3,326 | 3,161 | ||||||
Less — equity component, net of accumulated amortization | 15,517 | 0 | ||||||
Less—debt issuance cost, net of accumulated amortization of $6.1 million and $3.7 million, respectively | 8,022 | 7,403 | ||||||
Total notes and debentures | 399,115 | 298,404 | ||||||
Other Borrowings—Notes payable | 0 | 0 | ||||||
Total Long-term debt and other borrowings | $ | 399,115 | $ | 298,404 | ||||
December 31, | |||||||||||
(in thousands) | 2023 | 2022 | |||||||||
Term Loan - Whitehorse | $ | 185,000 | N/A | ||||||||
Term Loan – UBS | N/A | 302,654 | |||||||||
Backstop Notes | 120,000 | 120,000 | |||||||||
Other borrowings | 561 | 2,754 | |||||||||
Total | $ | 305,561 | $ | 425,408 | |||||||
Less: current portion of long-term debt | (2,411) | (5,345) | |||||||||
Less: debt issuance costs, net of accumulated amortization of $0.8 million and $8.5 million, respectively | (2,911) | (6,153) | |||||||||
Less: original issue discount | (4,130) | N/A | |||||||||
Total Long-term debt and other borrowings, net | $ | 296,109 | $ | 413,910 |
(in ‘000) | Amount | |||
2022 | $ | 3,326 | ||
2023 | 3,153 | |||
2024 | 299,501 | |||
2025 | 0 | |||
2026 | 0 | |||
Thereafter | 120,000 | |||
Total | $ | 425,980 | ||
(in thousands) | Principal Repayment | ||||
2024 | $ | 1,850 | |||
2025 | 1,850 | ||||
2026 | 1,850 | ||||
2027 | 1,850 | ||||
2028 | 297,600 | ||||
Total | $ | 305,000 |
(in thousands) | December 31, | |||||||||||||||||||
Financial Instruments Disclosed at Fair Value Level 2 | Measurement | 2023 | 2022 | |||||||||||||||||
Senior Secured Term Loan | Amortized cost | $ | 180,042 | N/A | ||||||||||||||||
Fair value | $ | 174,812 | N/A | |||||||||||||||||
Senior Secured UBS Term Loan | Amortized cost | N/A | $ | 298,956 | ||||||||||||||||
Fair value | N/A | $ | 283,612 | |||||||||||||||||
Mandatorily Redeemable Preferred Stock Due to Affiliate | Amortized cost | $ | 141,594 | N/A | ||||||||||||||||
Fair value | $ | 141,398 | N/A |
(in thousands) | December 31, | |||||||||||||||||||
Financial Instrument Disclosed at Fair Value Level 3 | Measurement | 2023 | 2022 | |||||||||||||||||
Backstop Notes (Level 3) | Amortized cost | $ | 117,916 | $ | 117,545 | |||||||||||||||
Fair value | $ | 91,204 | $ | 92,900 |
($ in thousands, except as otherwise noted) | December 31, | ||||||||||||||||
Significant Inputs for Level 3 Fair Value Disclosure | Input | 2023 | 2022 | ||||||||||||||
Backstop Notes | Principal amount | $120,000 | $120,000 | ||||||||||||||
Term to maturity date | 4.75 years | 5.75 years | |||||||||||||||
Stock price | $0.98 | $1.26 | |||||||||||||||
Credit spreads | 895 bps | 759 bps | |||||||||||||||
Selected equity volatility | 98.7 | % | 85.6 | % |
Number of awards outstanding (in thousands) | Weighted- average grant date fair value (per share) | |||||||||||||
Unvested RSUs as of December 31, 2021 | — | $ | — | |||||||||||
Granted | 5,789 | 6.24 | ||||||||||||
Vested | (52) | 6.88 | ||||||||||||
Forfeited and canceled | (222) | 6.97 | ||||||||||||
Unvested RSUs as of December 31, 2022 | 5,515 | $ | 6.06 | |||||||||||
Granted | 7,513 | 1.55 | ||||||||||||
Vested | (1,285) | 5.59 | ||||||||||||
Forfeited and canceled | (1,466) | 3.12 | ||||||||||||
Unvested RSUs as of December 31, 2023 | 10,277 | $ | 3.12 |
For the Year Ended December 31, | ||||||||||||||
2023 | 2022 | |||||||||||||
Expected volatility | 85 | % | 57.1% - 75.2% | |||||||||||
Risk-free interest rate | 4.7 | % | 1.4% - 2.1% | |||||||||||
Expected term | 2.63 years | 5-80 years |
For the Year Ended December 31, | ||||||||||||||
(in thousands) | 2023 | 2022 | ||||||||||||
Total stock compensation expense | $ | 11,251 | $ | 10,296 | ||||||||||
Income tax benefit | $ | 755 | $ | 1,346 | ||||||||||
Unrecognized compensation cost | $ | 18,411 | $ | 24,272 | ||||||||||
Weighted-average remaining service period | 1.52 years | 2.55 years |
For the Year Ended December 31, | |||||||||||
(in thousands) | 2023 | 2022 | |||||||||
United States | $ | (140,821) | $ | (92,021) | |||||||
Foreign | (30,379) | (24,596) | |||||||||
Total loss before income taxes | $ | (171,200) | $ | (116,617) |
For the Years Ended December 31, | ||||||||||||
2021 | 2020 | 2019 | ||||||||||
(in thousands) | ||||||||||||
United States | $ | (13,326 | ) | $ | (25,283 | ) | $ | (27,728 | ) | |||
Foreign | (20,821 | ) | (15,236 | ) | (8,656 | ) | ||||||
Total loss before income taxes | $ | (34,147 | ) | $ | (40,519 | ) | $ | (36,384 | ) | |||
For the Years Ended December 31, | ||||||||||||
2021 | 2020 | 2019 | ||||||||||
Current: | (in thousands) | |||||||||||
Federal | $ | — | $ | 0 | $ | (1,136 | ) | |||||
State | 420 | 546 | (44 | ) | ||||||||
Foreign | (243 | ) | 505 | (270 | ) | |||||||
Total current provision (benefit) | 177 | 1,051 | (1,450 | ) | ||||||||
Deferred: | ||||||||||||
Federal | (6,213 | ) | (7,120 | ) | (8,626 | ) | ||||||
State | (784 | ) | 2,285 | (2,117 | ) | |||||||
Foreign | (2,874 | ) | (1,534 | ) | (748 | ) | ||||||
Total deferred benefit | (9,871 | ) | (6,369 | ) | (11,491 | ) | ||||||
Total benefit | $ | (9,694 | ) | $ | (5,318 | ) | $ | (12,941 | ) | |||
For the Year Ended December 31, | |||||||||||
(in thousands) | 2023 | 2022 | |||||||||
Current: | |||||||||||
Federal | $ | 5,788 | $ | 4,309 | |||||||
State | 743 | 905 | |||||||||
Foreign | 723 | 558 | |||||||||
Total current provision | $ | 7,254 | $ | 5,772 | |||||||
Deferred: | |||||||||||
Federal | (8,580) | (9,336) | |||||||||
State | (946) | (4,455) | |||||||||
Foreign | (1,886) | (2,398) | |||||||||
Total deferred benefit | (11,412) | (16,189) | |||||||||
Total income tax benefit | $ | (4,158) | $ | (10,417) |
For the Year Ended December 31, | |||||||||||||||||||||||
(in thousands) | 2023 | 2022 | |||||||||||||||||||||
Benefit for income taxes at 21% rate | $ | (35,952) | 21.0 | % | $ | (24,490) | 21.0 | % | |||||||||||||||
State taxes, net of federal benefit | (2,123) | 1.2 | % | (1,358) | 1.2 | % | |||||||||||||||||
Change in valuation allowance | 16,889 | (9.9) | % | 10,628 | (9.1) | % | |||||||||||||||||
Rate change | (44) | 0.0 | % | (1,687) | 1.4 | % | |||||||||||||||||
Credits | (544) | 0.3 | % | (604) | 0.5 | % | |||||||||||||||||
Permanent differences and other | 1,440 | (0.7) | % | (2,712) | 2.2 | % | |||||||||||||||||
Revaluation of warrants | 1,352 | (0.8) | % | (53) | 0.0 | % | |||||||||||||||||
Uncertain tax positions | 1,580 | (0.9) | % | 591 | (0.5) | % | |||||||||||||||||
Foreign withholding tax | 148 | (0.1) | % | 134 | (0.1) | % | |||||||||||||||||
Foreign rate differential | (1,725) | 1.0 | % | (2,120) | 1.8 | % | |||||||||||||||||
Executive compensation expense | 634 | (0.4) | % | 872 | (0.7) | % | |||||||||||||||||
Transaction related expense | — | 0.0 | % | 210 | (0.2) | % | |||||||||||||||||
Global intangible low taxed income | 314 | (0.2) | % | 283 | (0.2) | % | |||||||||||||||||
Foreign derived intangible income | — | 0.0 | % | (311) | 0.3 | % | |||||||||||||||||
Goodwill impairment | 13,873 | (8.1) | % | 10,200 | (8.7) | % | |||||||||||||||||
Benefit for income taxes | $ | (4,158) | 2.4 | % | $ | (10,417) | 8.9 | % |
For the Years Ended December 31, | ||||||||||||||||||||||||
2021 | 2020 | 2019 | ||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||
Benefit for income taxes at 21% rate | $ | (7,171 | ) | 21.0 | % | $ | (8,509 | ) | 21.0 | % | $ | (7,641 | ) | 21.0 | % | |||||||||
State taxes, net of federal benefit | (1,227 | ) | 3.5 | % | (947 | ) | 2.3 | % | (2,161 | ) | 6.0 | % | ||||||||||||
Change in valuation allowance | 975 | -2.9 | % | 1,016 | -2.5 | % | 0 | 0.0 | % | |||||||||||||||
Rate change | 775 | -2.3 | % | 2,856 | -7.0 | % | 0 | 0.0 | % | |||||||||||||||
Credits | (602 | ) | 1.8 | % | (811 | ) | 2.0 | % | (541 | ) | 1.5 | % | ||||||||||||
Permanent differences and other | 47 | -0.1 | % | 307 | -0.8 | % | (41 | ) | 0.1 | % | ||||||||||||||
Revaluation of warrants | (1,106 | ) | 3.2 | % | 1,572 | -3.9 | % | (49 | ) | 0.1 | % | |||||||||||||
Uncertain tax positions | 9 | 0.0 | % | 226 | -0.6 | % | (984 | ) | 2.7 | % | ||||||||||||||
Foreign withholding tax | 116 | -0.3 | % | 420 | -1.0 | % | 0 | 0.0 | % | |||||||||||||||
Foreign rate differential | (1,573 | ) | 4.6 | % | (1,448 | ) | 3.6 | % | (1,524 | ) | 4.2 | % | ||||||||||||
Executive compensation expense | 1,517 | -4.4 | % | 0 | 0.0 | % | 0 | 0.0 | % | |||||||||||||||
Transaction related expense | (1,454 | ) | 4.3 | % | 0 | 0.0 | % | 0 | 0.0 | % | ||||||||||||||
Benefit for income taxes | $ | (9,694 | ) | 28.4 | % | $ | (5,318 | ) | 13.1 | % | $ | (12,941 | ) | 35.6 | % | |||||||||
As of December 31, | ||||||||
2021 | 2020 | |||||||
(in thousands) | ||||||||
Deferred tax assets: | ||||||||
Net operating loss carry-forward | $ | 11,081 | $ | 10,604 | ||||
Credit carry-forward | 2,802 | 2,468 | ||||||
Interest expense limitation carry-forward | 10,997 | 7,811 | ||||||
Non-deductible reserves | 374 | 520 | ||||||
Accruals and other temporary differences | 1,046 | 1,047 | ||||||
Stock compensation | 0 | 698 | ||||||
Property and equipment | 1,018 | 1,089 | ||||||
Gross deferred tax assets | 27,318 | 24,237 | ||||||
Less Valuation allowance | (7,731 | ) | (7,164 | ) | ||||
Total deferred tax assets (after valuation allowance) | 19,587 | 17,073 | ||||||
Deferred tax liabilities: | ||||||||
Property and equipment | (4,151 | ) | (4,089 | ) | ||||
Intangible assets | (40,754 | ) | (49,461 | ) | ||||
Goodwill | (7,432 | ) | (6,241 | ) | ||||
Debt discount | (3,972 | ) | — | |||||
Total deferred tax liabilities | (56,309 | ) | (59,791 | ) | ||||
Net deferred tax liabilities | $ | (36,722 | ) | $ | (42,718 | ) | ||
December 31, | |||||||||||
(in thousands) | 2023 | 2022 | |||||||||
Deferred tax assets: | |||||||||||
Net operating loss carry-forward | $ | 17,221 | $ | 13,617 | |||||||
Credit carryforward | 1,325 | 1,386 | |||||||||
Interest expense limitation carryforward | 21,978 | 15,844 | |||||||||
Non-deductible reserves | 1,571 | 339 | |||||||||
Accruals and other temporary differences | 2,622 | 2,835 | |||||||||
Stock compensation | 1,665 | 1,164 | |||||||||
Capitalized R&D Costs | 2,301 | — | |||||||||
Lease liability | 2,745 | 2,780 | |||||||||
Property and equipment | 1,849 | 1,007 | |||||||||
Gross deferred tax assets | $ | 53,277 | $ | 38,972 | |||||||
Less: valuation allowance | (33,454) | (16,177) | |||||||||
Total deferred tax assets (after valuation allowance) | $ | 19,823 | $ | 22,795 | |||||||
Deferred tax liabilities: | |||||||||||
Property and equipment | (1,442) | (1,738) | |||||||||
Intangible assets | (22,193) | (33,117) | |||||||||
Goodwill | (3,569) | (5,914) | |||||||||
Change in accounting method | (719) | (1,378) | |||||||||
Right-of-use asset | (2,357) | (2,514) | |||||||||
Research and development costs | (3,338) | (3,327) | |||||||||
Total deferred tax liabilities | $ | (33,618) | $ | (47,988) | |||||||
Net deferred tax liabilities | $ | (13,795) | $ | (25,193) |
(in thousands) | December 31, 2023 | December 31, 2022 | |||||||||
Unrecognized tax benefits as of the beginning of the year | $ | 8,574 | $ | 8,132 | |||||||
Additions for tax positions of current year | 192 | 442 | |||||||||
Unrecognized tax benefits as of the end of the year | $ | 8,766 | $ | 8,574 |
For the Year s Ended December 31, | ||||||||
2021 | 2020 | |||||||
(in thousands) | ||||||||
Unrecognized tax benefits at the beginning of the year | $ | 3,867 | $ | 3,658 | ||||
Additions for tax positions of current year | — | — | ||||||
Additions for tax positions of prior years | 0 | 209 | ||||||
Reductions for tax positions of prior years | — | — | ||||||
Expirations statutes of limitation | — | — | ||||||
Unrecognized tax benefits at the end of the year | $ | 3,867 | $ | 3,867 |
For the Year Ended December 31, | |||||||||||
($ in thousands, except share and per share amounts) | 2023 | 2022 | |||||||||
Numerator: | |||||||||||
Net loss | $ | (167,042) | $ | (106,200) | |||||||
Denominator: | |||||||||||
Weighted average shares outstanding - basic | 83,808,227 | 75,710,904 | |||||||||
Effect of dilutive equity awards (1) | — | — | |||||||||
Weighted average shares outstanding - diluted | 83,808,227 | 75,710,904 | |||||||||
Net loss per share: | |||||||||||
Basic | $ | (1.99) | $ | (1.40) | |||||||
Diluted | $ | (1.99) | $ | (1.40) |
For the Year Ended December 31, | |||||||||||
2023 | 2022 | ||||||||||
Grants of RSUs with service only (i.e., time-vesting) conditions | 6,193,746 | 3,552,416 | |||||||||
Common stock issuable under the Backstop Notes | 9,600,031 | 9,600,031 | |||||||||
Private placement warrants | 272,779 | 272,779 |
December 31, | |||||||||||
2023 | 2022 | ||||||||||
Common stock issued, beginning of year | 76,292,241 | 72,027,743 | |||||||||
Common stock issued pursuant to acquisition | 10,000,000 | 4,212,246 | |||||||||
Vesting of restricted stock units | (1,284,939) | 52,252 | |||||||||
Stock awards cancelled for employee tax withholdings | (190,882) | — | |||||||||
Common stock issued, end of year | 84,816,420 | 76,292,241 | |||||||||
Treasury stock, at cost, beginning of year | — | — | |||||||||
Purchase of treasury stock | (5,000,000) | — | |||||||||
Treasury stock, at cost, end of year | (5,000,000) | — | |||||||||
Common stock outstanding, end of the year | 79,816,420 | 76,292,241 |
($ in thousands) | Shares | Carrying amount | |||||||||
Preferred stock, beginning of year | — | — | |||||||||
Preferred stock issued November 15, 2023 | 150,000 | $ | 150,000 | ||||||||
Preferred stock issued December 13, 2023 | 2,857 | 2,857 | |||||||||
Preferred stock issuance costs (1) | N/A | (6,087) | |||||||||
Allocation of proceeds to preferred stock (2) | N/A | (5,327) | |||||||||
Preferred stock, end of year | 152,857 | $ | 141,443 |
Derivatives Not Designated as Hedging Instruments | Number of Warrants (Notional Amount) | Warrant Liability | Exercise Price Per Share | |||||||||||||||||
($ in thousands, except for per share amounts) | ||||||||||||||||||||
Penny warrants issued to Searchlight | 12,024,711 | $ | 11,664 | $ | 0.01 |
Derivatives Not Designated as Hedging Instruments | Net Realized Gains (Losses) on Derivative Instruments | Net Change in Unrealized Gain (Loss) on Derivative Instruments (2) | ||||||||||||
(in thousands) | ||||||||||||||
Penny warrants issued to Searchlight | $ | — | $ | (6,469) |
December 31, | |||||||||||
(in thousands) | 2023 | 2022 | |||||||||
Prepaid expenses | $ | 7,411 | $ | 8,362 | |||||||
Other current assets | 2,635 | 523 | |||||||||
Deposits | 2,061 | 2,864 | |||||||||
Income taxes receivable | 1,499 | 502 | |||||||||
Indirect sales taxes receivable | 616 | 1,735 | |||||||||
Total prepaid expenses and other current assets | $ | 14,222 | $ | 13,986 |
December 31, | |||||||||||
(in thousands) | 2023 | 2022 | |||||||||
Accrued other expenses | $ | 8,350 | $ | 3,970 | |||||||
Accrued cost of revenue | 4,728 | 4,091 | |||||||||
Accrued payroll and related | 4,623 | 4,804 | |||||||||
Sales and other taxes payable | 4,999 | 2,813 | |||||||||
Income taxes payable | 615 | 207 | |||||||||
Finance lease obligation | 106 | 115 | |||||||||
Total accrued liabilities | $ | 23,421 | $ | 16,000 |
(in ‘000) | Amount | |||
2022 | $ | 2,924 | ||
2023 | 1,904 | |||
2024 | 1,495 | |||
2025 | 1,170 | |||
2026 | 958 | |||
Thereafter | 3,412 | |||
Total | $ | 11,863 | ||
(in ‘000) | Amount | |||
2022 | $ | 207 | ||
2023 | 143 | |||
2024 | 119 | |||
2025 | 26 | |||
2026 | 0 | |||
Total minimum lease payments | $ | 495 | ||
Interest expense | (40 | ) | ||
Total | $ | 455 | ||
(in ‘000) | Amount | |||
2022 | $ | 21,144 | ||
2023 | 9,446 | |||
2024 | 1,245 | |||
2025 | 1,245 | |||
2026 | 0 | |||
Thereafter | 0 | |||
Total | $ | 33,080 | ||
($ in thousands) | |||||
2024 | $ | 30,745 | |||
2025 | 10,688 | ||||
2026 | 5,423 | ||||
2027 | 4,773 | ||||
2028 | 5,000 | ||||
Thereafter | 2,273 | ||||
Total | $ | 58,902 |
(in ‘000) | December 31, 2021 | December 31, 2020 | ||||||
Prepaid deposits | $ | 1,030 | $ | 1,734 | ||||
Prepaid expenses | 6,418 | 3,695 | ||||||
Other receivables | 0 | 0 | ||||||
Total Prepaid expenses and other receivables | $ | 7,448 | $ | 5,429 | ||||
Amount (in ‘000) | Series A | Series A-1 | Series B | |||||||||
Accumulated and unpaid, December 31, 2019 | $ | 25,610 | $ | 8,794 | $ | 25,338 | ||||||
Accumulated | 9,202 | 9,814 | 8,572 | |||||||||
Distributed | 0 | 0 | 0 | |||||||||
Accumulated and unpaid, December 31, 2020 | $ | 34,812 | $ | 18,608 | $ | 33,910 | ||||||
Accumulated | 7,656 | 8,241 | 6,925 | |||||||||
Distributed | (42,468 | ) | (26,849 | ) | (40,835 | ) | ||||||
Accumulated and unpaid, December 31, 2021 | $ | 0 | $ | 0 | $ | 0 | ||||||
Number of Options | Weighted Average Grant Date Fair Value per Option (Amount) | Weighted Average Exercise Price (Amount) | Weighted Average Remaining Contractual Term (Years) | |||||||||||||
Balance, December 31, 2018 | 414,434 | $ | 15.80 | $ | 141.53 | 9.3 | ||||||||||
Granted | 52,083 | 15.91 | 141.53 | |||||||||||||
Exercised | — | — | — | |||||||||||||
Forfeited | (67,366 | ) | 15.80 | 141.53 | ||||||||||||
Expired | — | — | — | |||||||||||||
Balance, December 31, 2019 | 399,151 | $ | 15.82 | 141.53 | 8.4 | |||||||||||
Granted | 64,064 | 13.50 | 141.53 | |||||||||||||
Exercised | — | — | — | |||||||||||||
Forfeited | (30,715 | ) | 15.80 | 141.53 | ||||||||||||
Expired | — | — | — | |||||||||||||
Balance, December 31, 2020 | 432,500 | $ | 15.45 | $ | 141.53 | 7.7 | ||||||||||
Granted | — | — | — | |||||||||||||
Exercised | — | — | — | |||||||||||||
Forfeited | — | — | — | |||||||||||||
Expired | — | — | — | |||||||||||||
Cancelled | (432,500 | ) | (15.45 | ) | (141.53 | ) | (7.7 | ) | ||||||||
Balance, December 31, 2021 | 0 | $ | 0 | $ | 0 | — | ||||||||||
(in ‘000) | December 31, 2021 | December 31, 2020 | ||||||
Total Stock Compensation Expense | $ | 4,564 | $ | 1,161 | ||||
Unrecognized Compensation Cost | 0 | 3,416 | ||||||
Remaining recognition period (in years) | — | 2.7 |
December 31, 2021 | December 31, 2020 | |||||||
Range of Exercise Prices | 0 | $ | 80.87 -$202.18 | |||||
Number | 0 | 153,898 | ||||||
Weighted Average Remaining Contractual Term (in years) | — | 7.3 | ||||||
Weighted Average Exercise Price | $ | 0 | $ | 141.53 |
(in ‘000) | December 31, 2021 | December 31, 2020 | December 31, 2019 | |||||||||
Numerator: | ||||||||||||
Net loss attributable to the Company | $ | (24,453 | ) $ | (35,201 | ) $ | (23,443 | ) | |||||
Less cumulative earnings to preferred | (22,822 | ) | (26,900 | ) | (21,647 | ) | ||||||
Add premium on preferred conversion to common shares | 4,074 | — | — | |||||||||
Net income (loss) attributable to common stockholders | (43,201 | ) | (62,101 | ) | (45,090 | ) | ||||||
Denominator: | ||||||||||||
Weighted average common shares and warrants outstanding | ||||||||||||
Basic (in number) | 41,933,050 | 31,650,173 | 31,169,435 | |||||||||
Diluted (in number) | 41,933,050 | 31,650,173 | 31,169,435 | |||||||||
Net loss per unit attributable to common stockholder | ||||||||||||
Basic | $ | (1.03 | ) | $ | (1.96 | ) | $ | (1.45 | ) | |||
Diluted | $ | (1.03 | ) | $ | (1.96 | ) | $ | (1.45 | ) |
For the years ended (number of shares) | December 31, 2021 | December 31, 2020 | December 31, 2019 | |||||||||
Series C Convertible Preferred Stock | 2,566,186 | 2,566,186 | 2,566,186 | |||||||||
Stock Options | 432,500 | 432,500 | 399,151 | |||||||||
Common stock issued under the Backstop Agreement | 9,600,031 | — | — |
(in ‘000) | December 31, 2021 | December 31, 2020 | ||||||
Interfusion B.V. | 0 | 985 | ||||||
T-Fone B.V. | 0 | 630 |
December 31, | |||||||||||||||||
($ in thousands) | 2023 | 2022 | |||||||||||||||
Goodwill: | |||||||||||||||||
United States | $ | 173,916 | 59 | % | $ | 248,928 | 67 | % | |||||||||
Switzerland | 112,203 | 38 | % | 112,203 | 30 | % | |||||||||||
All other countries | 8,855 | 3 | % | 8,575 | 2 | % | |||||||||||
Total goodwill | $ | 294,974 | 100 | % | $ | 369,706 | 100 | % | |||||||||
Intangible assets, net: | |||||||||||||||||
United States | $ | 118,833 | 71 | % | $ | 136,572 | 71 | % | |||||||||
Switzerland | 25,277 | 15 | % | 36,417 | 19 | % | |||||||||||
All other countries (1) | 23,477 | 14 | % | 19,515 | 10 | % | |||||||||||
Total intangible assets, net | $ | 167,587 | 100 | % | $ | 192,504 | 100 | % | |||||||||
Property and equipment, net: | |||||||||||||||||
United States | $ | 7,070 | 65 | % | $ | 7,060 | 59 | % | |||||||||
Netherlands | 2,387 | 22 | % | 2,559 | 22 | % | |||||||||||
All other countries (1) | 1,499 | 14 | % | 2,280 | 19 | % | |||||||||||
Total property and equipment, net | $ | 10,956 | 100 | % | $ | 11,899 | 100 | % | |||||||||
Operating lease right-of-use assets: | |||||||||||||||||
United States | $ | 7,612 | 81 | % | $ | 8,729 | 87 | % | |||||||||
All other countries (1) | 1,755 | 19 | % | 1,290 | 13 | % | |||||||||||
Total operating lease right-of-use assets | $ | 9,367 | 100 | % | $ | 10,019 | 100 | % |
(in thousands) | ||||
Cash, including closing cash and working capital adjustments | $ | 47,336 | ||
Fair value of KORE common stock issued to sellers (4,212,246 shares) | 23,294 | |||
Total consideration | $ | 70,630 | ||
Assets acquired: | ||||
Cash | 1,996 | |||
Accounts receivable | 3,115 | |||
Inventories | 1,323 | |||
Prepaid expenses and other receivables | 821 | |||
Property and equipment | 201 | |||
Intangible assets | 30,060 | |||
Total Assets acquired | 37,516 | |||
Liabilities assumed: | ||||
Deferred tax liabilities | 7,611 | |||
Accounts payable and accrued liabilities | 2,607 | |||
Liabilities assumed | 10,218 | |||
Net identifiable assets acquired | 27,298 | |||
Goodwill (excess of consideration transferred over net identifiable assets acquired) | $ | 43,332 | ||
December 31, 2021 | December 31, 2020 | |||||||
Assets | ||||||||
Non-current assets | ||||||||
Investment in subsidiaries | $ | 261,012 | $ | 300,055 | ||||
Total non-current assets | 261,012 | 300,055 | ||||||
Total assets | $ | 261,012 | $ | 300,055 | ||||
Liabilities, temporary equity and stockholders’ equity | ||||||||
Long-term liabilities | ||||||||
Warrant liability | $ | 286 | $ | 15,944 | ||||
Total liabilities | 286 | 15,944 | ||||||
Temporary equity | ||||||||
Series A Preferred Stock; par value $1,000 per share; NaN authorized, issued and outstanding at December 31, 2021; 7,765,229 shares authorized, and 7,756,158 shares issued and outstanding at December 31, 2020 | 0 | 77,562 | ||||||
Series A-1 Preferred Stock; par value $1,000 per share; NaN authorized, issued and outstanding at December 31, 2021; 10,480,538 shares authorized, 7,862,107 shares issued and outstanding at December 31, 2020 | 0 | 78,621 | ||||||
Series B Preferred Stock; par value $1,000 per share; NaN authorized, issued and outstanding at December 31, 2021; 9,090,975 shares authorized, 9,090,975 shares issued and outstanding at December 31, 2020 | 0 | 90,910 | ||||||
Series C Convertible Preferred Stock; par value $1,000 per share; NaN authorized, issued and outstanding at December 31, 2021; 6,872,894 shares authorized, 2,566,186 shares issued and outstanding at December 31, 2020 | 0 | 16,802 | ||||||
Total temporary equity | 0 | 263,895 | ||||||
Stockholders’ equity | ||||||||
Common stock, voting; par value $0.0001 per share; 315,000,000 shares authorized, 72,027,743 shares issued and outstanding at December 31, 2021; 55,659,643 shares authorized, 30,281,520 shares issued and outstanding at December 31, 2020 | 7 | 3 | ||||||
Additional paid-in capital | 401,688 | 135,616 | ||||||
Accumulated other comprehensive loss | (3,331 | ) | (1,677 | ) | ||||
Accumulated deficit | (137,638 | ) | (113,726 | ) | ||||
Total stockholders’ equity | 260,726 | 20,216 | ||||||
Total liabilities, temporary equity and stockholders’ equity | $ | 261,012 | $ | 300,055 | ||||
For the years ended | December 31, 2021 | December 31, 2020 | December 31, 2019 | |||||||||
Equity in net loss of unconsolidated subsidiaries | $ | (29,177 | ) | $ | (27,716 | ) | $ | (23,678 | ) | |||
Change in fair value of warrant liability | (5,267 | ) | 7,485 | (235 | ) | |||||||
Loss before income taxes | (23,910 | ) | (35,201 | ) | (23,443 | ) | ||||||
Net loss | $ | (23,910 | ) | $ | (35,201 | ) | $ | (23,443 | ) | |||
Other comprehensive loss: | ||||||||||||
Foreign currency translation adjustment | (1,654 | ) | 2,116 | 517 | ||||||||
Comprehensive loss | $ | (25,564 | ) | $ | (33,085 | ) | $ | (22,926 | ) | |||
For the years ended | December 31, 2021 | December 31, 2020 | December 31, 2019 | |||||||||
Cash flows from operating activities | ||||||||||||
Net loss | $ | (23,910 | ) | $ | (35,201 | ) | $ | (23,443 | ) | |||
Adjustments to reconcile net loss to net cash provided by operating activities | — | — | ||||||||||
Equity in net loss of unconsolidated subsidiaries | 29,177 | 27,716 | 23,678 | |||||||||
Change in fair value of warrant liability | (5,267 | ) | 7,485 | (235 | ) | |||||||
Cash provided by operating activities | $ | 0 | $ | 0 | $ | 0 | ||||||
Cash flows from investing activities | ||||||||||||
Distribution from subsidiary | 5,947 | 200 | 80 | |||||||||
Cash provided by investing activities | $ | 5,947 | $ | 200 | $ | 80 | ||||||
Cash flows from financing activities | ||||||||||||
Repurchase of common stock | 0 | (200 | ) | (80 | ) | |||||||
Issuance of common stock, net of transaction costs | 223,968 | — | — | |||||||||
Settlement of preferred stock | (229,915 | ) | — | — | ||||||||
Cash used in financing activities | $ | (5,947 | ) | $ | (200 | ) | $ | (80 | ) | |||
Effect of exchange rate change on cash and cash equivalents | 0 | 0 | 0 | |||||||||
Change in cash and cash equivalents and restricted cash | 0 | 0 | 0 | |||||||||
Cash and cash equivalents and restricted cash, beginning of | 0 | 0 | 0 | |||||||||
Cash and cash equivalents and restricted cash, end of year | $ | 0 | $ | 0 | $ | 0 | ||||||
Non-cash investing and financing activities: | ||||||||||||
Equity issued for acquisition of Integron, LLC | $ | 0 | $ | 0 | $ | 7,000 | ||||||
Share-based payment awards issued to employees of subsidiaries | $ | 1,839 | $ | 1,161 | $ | 1,682 | ||||||
Exhibit Number | Description | |||||||
2.1 | ||||||||
2.2 | ||||||||
2.3 | ||||||||
3.1 | ||||||||
3.2 | ||||||||
3.3 | ||||||||
3.4 | ||||||||
4.1 | ||||||||
4.2 | ||||||||
4.3 | ||||||||
* | ||||||||
4.5 | * | |||||||
4.6 | ||||||||
4.7 | ||||||||
* | ||||||||
10.1 | ||||||||
10.2 |
Exhibit Number | Description | |||||||
10.23 | Business Combination Agreement, by and among Kore Group Holdings, Inc., BMP Simon Holdings, LLC, BMP Merger Sub I, Inc., BMP Merger Sub II, Inc., Business Mobility Partners Inc., Simon IOT LLC, and each of Jared Deith, Steven Daneshgar, David Isler, Stuart Lowenstein and Aaron Slonim, dated February 16, 2022 (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on February 23, 2022). | |||||||
10.24 | ||||||||
10.25 | ||||||||
10.26 | † | |||||||
10.27 | † | |||||||
10.28 | † | |||||||
10.29 | † | |||||||
10.30 | † | |||||||
14.1 | * | |||||||
21.1 | * | |||||||
23.1 | ||||||||
* | ||||||||
31.1 | ||||||||
* | ||||||||
31.2 | ||||||||
* | ||||||||
32.1 | ||||||||
** | ||||||||
32.2 | ||||||||
** | ||||||||
97.1 | *† | |||||||
101.Def | Definition Linkbase Document | |||||||
101.Pre | Presentation Linkbase Document | |||||||
101.Lab | Labels Linkbase Document | |||||||
101.Cal | Calculation Linkbase Document | |||||||
101.Sch | Schema Document | |||||||
101.Ins | Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document | |||||||
104 | Cover Page Interactive Date File (formatted in Inline XBRL and contained in Exhibit 101) |
KORE GROUP HOLDINGS, INC. | |||||||||
By: | /s/ Romil Bahl | ||||||||
Romil Bahl | |||||||||
President, Chief Executive Officer and Director |
Signature | Title | Date | |||||||||||||
/s/ Romil Bahl | President, Chief Executive Officer and Director | ||||||||||||||
Romil Bahl | (Principal Executive Officer) | ||||||||||||||
/s/ Paul Holtz | EVP, Chief Financial Officer and Treasurer | ||||||||||||||
Paul Holtz | (Principal Financial Officer and Principal Accounting Officer) | ||||||||||||||
/s/ Cheemin Bo-Linn | Director | April 15, 2024 | |||||||||||||
Cheemin Bo-Linn | |||||||||||||||
/s/ Timothy Donahue | Director | ||||||||||||||
Timothy Donahue | |||||||||||||||
/s/ H. Paulett Eberhart | Director | ||||||||||||||
H. Paulett Eberhart | |||||||||||||||
/s/ Andrew Frey | Director | April 15, 2024 | |||||||||||||
Andrew Frey | |||||||||||||||
/s/ David Fuller | Director | April 15, 2024 | |||||||||||||
David Fuller | |||||||||||||||
/s/ James Geisler | Director | ||||||||||||||
James Geisler | |||||||||||||||
/s/ Jay M. Grossman | Director | April 15, 2024 | |||||||||||||
Jay M. Grossman | |||||||||||||||
/s/ Robert P. MacInnis | Director | ||||||||||||||
Robert P. MacInnis | |||||||||||||||
/s/ Michael K. Palmer | Director | ||||||||||||||
Michael K. Palmer | |||||||||||||||