klr-10q_20210930.htm

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 checkmark 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, or a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer”, “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.:

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 November 3, 2021, there were 41,682,771 shares of the Company’s common stock issued and outstanding.

	September 30, 2021			December 31, 2020 (1)
ASSETS
Current assets:
Cash and cash equivalents	$	70,303		$	32,970
Restricted cash		1,738			—
Short-term investments		36,447			4,843
Trade receivables, net		82,749			43,651
Prepaid expenses		3,444			1,447
Deferred costs		330			—
Other current assets		4,408			2,134
Total current assets		199,419			85,045
Property and equipment, net		17,203			6,726
Intangible assets, net		130,085			7,574
Goodwill		110,657			16,657
Deferred tax assets		—			703
Other long-term assets		395			1,797
Total Assets	$	457,759		$	118,502
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Current liabilities:
Accounts payable	$	74,692		$	51,768
Debt for forward share purchase agreements		—			483
Notes payable due to related parties		—			7,500
Lines of credit		5,464			5,273
Current portion of bank and other borrowings		10,455			10,798
Deferred revenue		11,055			3,666
Payroll and payroll related accrued liabilities		5,450			3,292
Other current liabilities		8,879			5,988
Total current liabilities		115,995			88,768
Long-term portion of bank and other borrowings		26,574			31,974
Long-term portion of notes payable		189,647			2,700
Long-term portion of employee benefit obligation		2,158			1,886
Deferred tax liability		2,402			—
Other long-term liabilities		2,004			603
Total Liabilities		338,780			125,931
Commitments and contingencies (Note 15)
Stockholders’ equity (deficit):
Preferred stock, par value of $0.0001 per share; 1,000,000 shares authorized; no shares issued or outstanding		—			—
Common stock, par value of $0.0001 per share; 100,000,000 shares authorized as of September 30, 2021 and December 31, 2020; 44,480,829 shares issued and 41,682,771 shares outstanding as of September 30, 2021 and 33,086,745 shares issued and 30,288,687 shares outstanding as of December 31, 2020		4			3
Additional paid-in capital		246,205			93,628
Treasury stock, at cost; 2,798,058 shares as of September 30, 2021 and December 31, 2020		(30,431	)		(30,431	)
Accumulated other comprehensive loss		(2,292	)		(2,826	)
Accumulated deficit		(94,507	)		(67,803	)
Total stockholders’ equity (deficit)		118,979			(7,429	)
Total liabilities and stockholders’ equity (deficit)	$	457,759		$	118,502

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

	Three Months Ended September 30,						Nine Months Ended September 30,
	2021			2020			2021			2020
Revenue	$	84,025		$	38,268		$	177,731		$	103,100
Cost of revenue		64,414			30,763			141,333			86,511
Gross profit		19,611			7,505			36,398			16,589
Operating expenses:
Research and development		7,163			2,259			14,313			7,415
Sales and marketing		7,272			3,423			14,791			10,155
General and administrative		12,631			6,441			35,597			20,737
Total operating expenses		27,066			12,123			64,701			38,307
Loss from operations		(7,455	)		(4,618	)		(28,303	)		(21,718	)
Other income, net		66			38			158			91
Financial expense, net		(3,542	)		(468	)		(5,169	)		(1,027	)
Foreign currency income (loss)		(162	)		(548	)		2			(795	)
Loss before income tax expense (benefit)		(11,093	)		(5,596	)		(33,312	)		(23,449	)
Income tax expense (benefit)		766			(263	)		(6,608	)		(1,165	)
Net loss	$	(11,859	)	$	(5,333	)	$	(26,704	)	$	(22,284	)
Net loss per common share, basic and diluted	$	(0.29	)	$	(0.19	)	$	(0.75	)	$	(0.97	)
Weighted-average shares used in computing net loss per common share, basic and diluted		41,554,876			28,330,869			35,404,231			22,972,425

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

	Three Months Ended September 30,						Nine Months Ended September 30,
	2021			2020			2021			2020
Net loss	$	(11,859	)	$	(5,333	)	$	(26,704	)	$	(22,284	)
Other comprehensive income (loss):
Foreign currency translation adjustments		16			(619	)		519			(1,812	)
Net change in unrealized gain on marketable securities, net of tax		(4	)		1			15			5
Total other comprehensive income (loss)		12			(618	)		534			(1,807	)
Total comprehensive loss	$	(11,847	)	$	(5,951	)	$	(26,170	)	$	(24,091	)

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

	Three Months Ended September 30, 2021
	Common Stock				Additional Paid-in			Treasury Stock					Accumulated Other Comprehensive			Accumulated			Total Stockholders' Equity
	Shares		Amount		Capital			Shares		Amount			Income (Loss)			Deficit			(Deficit)
Balance as of June 30, 2021		41,307,336	$	4	$	245,452			2,798,058	$	(30,431	)	$	(2,304	)	$	(82,648	)	$	130,073
Stock-based compensation (RSUs)		375,435		—		6,227			—		—			—			—			6,227
Warrants repurchase (1)		—		—		(5,474	)		—		—			—			—			(5,474	)
Net loss									—		—			—			(11,859	)		(11,859	)
Other comprehensive income									—		—			12			—			12
Balance as of September 30, 2021		41,682,771	$	4	$	246,205			2,798,058	$	(30,431	)	$	(2,292	)	$	(94,507	)	$	118,979

	Three Months Ended September 30, 2020
	Common Stock					Additional Paid-in		Treasury Stock					Accumulated Other Comprehensive			Accumulated			Total Stockholders' Equity
	Shares			Amount		Capital		Shares		Amount			Income (Loss)			Deficit			(Deficit)
Balance as of June 30, 2020		27,999,713		$	3	$	74,284		2,258,510	$	(24,218	)	$	(1,115	)	$	(57,944	)	$	(8,990	)
Common stock repurchased in connection with forward share purchase agreements		(539,548	)		—		6,213		539,548		(6,213	)		—			—			—
Stock-based compensation (RSUs)		30,000			—		4,922		—		—			—			—			4,922
Proceeds from issuance of common stock in public offering, net of issuance costs		984,916			—		4,155		—		—			—			—			4,155
Net loss		—			—		—		—		—			—			(5,333	)		(5,333	)
Other comprehensive loss		—			—		—		—		—			(618	)		—			(618	)
Balance as of September 30, 2020		28,475,081		$	3	$	89,574		2,798,058	$	(30,431	)	$	(1,733	)	$	(63,277	)	$	(5,864	)

	Nine Months Ended September 30, 2021
	Common Stock					Additional Paid-in		Treasury Stock					Accumulated Other Comprehensive			Accumulated			Total Stockholders' Equity
	Shares			Amount		Capital		Shares		Amount			Income (Loss)			Deficit			(Deficit)
Balance as of December 31, 2020		30,288,687		$	3	$	93,628		2,798,058	$	(30,431	)	$	(2,826	)	$	(67,803	)	$	(7,429	)
Conversion of Cowen Note		303,171			—		2,295		—		—			—			—			2,295
Forfeiture of 2020 Sponsors' Earnout Shares (3)		(469,343	)		—		1,244		—		—			—			—			1,244
Forward share purchase agreement transactions		—			—		17,528		—		—			—			—

Delaware		82-3027430
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification Number)

Via Marco D’Aviano, 2, Milano MI, Italy		20131
(Address of principal executive offices)		(Zip Code)

Title of each class	Trading Symbols	Name of each exchange on which registered
Common Stock, par value $0.0001 per share	KLR	New York Stock Exchange
Warrants, at an exercise price of $11.50 per share of Common Stock	KLR WS	NYSE American LLC

PART I – FINANCIAL INFORMATION		Page

Item 1.	Condensed Consolidated Financial Statements (unaudited):	1

	Condensed Consolidated Balance Sheets	1

	Condensed Consolidated Statements of Operations	2

	Condensed Consolidated Statements of Comprehensive Loss	3

	Condensed Consolidated Statements of Stockholders’ Equity (Deficit)	4

	Condensed Consolidated Statements of Cash Flows	7

	Notes to Condensed Consolidated Financial Statements	9

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	32

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	45

Item 4.	Controls and Procedures	45

PART II – OTHER INFORMATION

Item 1.	Legal Proceedings	47

Item 1A.	Risk Factors	48

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	50

Item 3.	Defaults Upon Senior Securities	51

Item 4.	Mine Safety Disclosures	51

Item 5.	Other Information	51

Item 6.	Exhibits	52

Signatures		53

Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	Smaller reporting company	☒
		Emerging growth company	☒