On January 6, 2023, following the completion of its previously announced acquisition of CASE Emergency Systems in October 2022, Knightscope, Inc. (the “Company”) announced a cost-reduction plan (the “Plan”) intended to reduce operating costs, improve operating margins, streamline its operations and right-size its combined workforce and continue advancing the Company’s ongoing commitment to profitable growth. The Plan includes a reduction of the Company’s current workforce by approximately 20%.
The Company estimates that it will incur approximately $613,400 in cash and non-cash charges in connection with the Plan, of which approximately $594,600 is expected to be incurred in the first quarter of 2023. These charges relate primarily to severance payments, employee benefits, and share-based compensation. Of the aggregate amount of charges that the Company estimates it will incur in connection with the Plan, the Company expects that approximately $168,500 will be cash expenditures in 2023.
The actions associated with the employee restructuring under the Plan are expected to be substantially complete by the end of the first quarter of 2023, subject to local law and consultation requirements.
The estimates of the charges and expenditures that the Company expects to incur in connection with the Plan, and the timing thereof, are subject to a number of assumptions, including local law requirements in various jurisdictions, and actual amounts may differ materially from estimates.
In addition, the Company may incur other charges or cash expenditures not currently contemplated due to unanticipated events that may occur, including in connection with the implementation of the Plan.
