30,110Q300017779460.1P1Y--12-31P3M10P1YP1YfalseP1Y0001777946srt:MaximumMemberirnt:StockIncentivePlanMemberus-gaap:CommonClassAMember2021-10-310001777946srt:ScenarioPreviouslyReportedMemberus-gaap:SeriesAPreferredStockMember2020-01-310001777946irnt:PublicWarrantsMember2021-02-012021-10-310001777946irnt:LglFoundersSharesMember2021-02-012021-10-310001777946srt:RevisionOfPriorPeriodReclassificationAdjustmentMemberus-gaap:CommonClassAMember2020-01-310001777946irnt:SubscriptionNotesReceivableMember2021-07-310001777946irnt:SubscriptionNotesReceivableMember2020-01-3100017779462021-02-012021-10-3100017779462022-02-012021-10-310001777946irnt:CaresActMemberirnt:PaybackProtectionProgramLoanMember2021-02-012021-10-310001777946us-gaap:CommonClassAMember2020-02-012020-10-310001777946irnt:PrivateWarrantsMemberus-gaap:CommonClassAMember2021-10-3100017779462024-02-012021-10-3100017779462020-01-310001777946us-gaap:AdditionalPaidInCapitalMember2020-08-012020-10-310001777946us-gaap:AccumulatedOtherComprehensiveIncomeMembersrt:ScenarioPreviouslyReportedMember2020-01-310001777946irnt:SubscriptionNotesReceivableMember2020-02-012020-10-310001777946irnt:PrivateWarrantsMemberus-gaap:CommonClassAMember2021-08-012021-10-310001777946us-gaap:NonUsMember2020-02-012020-10-310001777946irnt:EarnoutSharesMember2021-08-012021-10-310001777946us-gaap:FairValueMeasurementsRecurringMember2021-10-310001777946us-gaap:AdditionalPaidInCapitalMembersrt:ScenarioPreviouslyReportedMember2020-01-310001777946irnt:PublicWarrantsExercisedMember2021-10-310001777946irnt:ThreeCustomersMemberus-gaap:CustomerConcentrationRiskMemberus-gaap:AccountsReceivableMember2021-01-312021-01-310001777946irnt:CaresActMemberirnt:PaybackProtectionProgramLoanMember2021-10-310001777946us-gaap:AdditionalPaidInCapitalMembersrt:RevisionOfPriorPeriodReclassificationAdjustmentMember2020-01-3100017779462021-08-152021-08-150001777946srt:RevisionOfPriorPeriodReclassificationAdjustmentMemberus-gaap:SeriesBPreferredStockMember2020-01-310001777946us-gaap:SalesRevenueNetMemberirnt:CustomerCMemberus-gaap:CustomerConcentrationRiskMember2020-02-012020-10-310001777946irnt:PrivateWarrantsMemberus-gaap:CommonClassAMember2021-02-012021-10-3100017779462020-07-310001777946irnt:PublicWarrantsMember2020-02-012020-10-3100017779462023-02-012021-10-310001777946us-gaap:FairValueMeasurementsRecurringMember2021-01-310001777946us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-10-310001777946us-gaap:RestrictedStockUnitsRSUMember2021-02-012021-10-310001777946us-gaap:AdditionalPaidInCapitalMember2020-10-310001777946irnt:StockIncentivePlanMember2021-02-012021-10-310001777946irnt:SubscriptionNotesReceivableMember2021-01-310001777946irnt:PublicWarrantsMember2021-08-260001777946irnt:CaresActMemberirnt:OtherCurrentAndLongTermLiabilitiesMemberirnt:ImpactOfPppLoanUnderCaresActMember2021-10-310001777946us-gaap:CommonClassAMember2020-07-310001777946us-gaap:CommonClassAMember2021-07-310001777946us-gaap:RetainedEarningsMember2021-08-012021-10-310001777946irnt:CaresActMemberirnt:PaybackProtectionProgramLoanMember2021-01-310001777946us-gaap:AdditionalPaidInCapitalMember2021-02-012021-10-310001777946us-gaap:CommonStockMember2021-02-012021-10-310001777946irnt:PrivateWarrantsExercisedMember2021-10-310001777946srt:ScenarioPreviouslyReportedMemberus-gaap:CommonClassAMember2020-01-310001777946irnt:ProfessionalServicesRevenueMember2021-08-012021-10-310001777946us-gaap:RetainedEarningsMember2020-07-310001777946irnt:PublicWarrantsMember2021-02-012021-10-310001777946srt:ScenarioForecastMember2022-08-012022-10-310001777946us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-02-012020-10-3100017779462020-02-012020-10-310001777946irnt:PublicWarrantsMember2021-08-012021-10-310001777946us-gaap:EmployeeStockOptionMember2020-02-012020-10-310001777946us-gaap:CommonClassAMember2021-08-012021-10-310001777946srt:ScenarioPreviouslyReportedMember2020-01-310001777946us-gaap:RestrictedStockUnitsRSUMember2020-02-012020-10-310001777946us-gaap:OtherNoncurrentAssetsMember2021-10-310001777946us-gaap:AdditionalPaidInCapitalMember2020-01-310001777946irnt:CustomerBMemberus-gaap:SalesRevenueNetMemberus-gaap:CustomerConcentrationRiskMember2020-08-012020-10-310001777946irnt:PipeSharesMember2021-08-260001777946us-gaap:ConvertiblePreferredStockMember2020-02-012020-10-310001777946us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-02-012021-10-310001777946irnt:SubscriptionNotesReceivableMembersrt:ScenarioPreviouslyReportedMember2020-01-310001777946irnt:PrivateWarrantsMember2021-02-012021-10-3100017779462021-07-310001777946us-gaap:RetainedEarningsMember2021-07-310001777946srt:RevisionOfPriorPeriodReclassificationAdjustmentMemberus-gaap:SeriesAPreferredStockMember2020-01-3100017779462020-08-012020-10-310001777946irnt:SubscriptionRevenueMember2021-08-012021-10-310001777946country:US2021-02-012021-10-3100017779462021-12-150001777946irnt:PrivateWarrantsMember2021-08-012021-10-310001777946us-gaap:RetainedEarningsMember2020-02-012020-10-310001777946srt:ScenarioPreviouslyReportedMemberus-gaap:SeriesBPreferredStockMember2020-01-3100017779462021-08-2600017779462018-12-290001777946us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2021-10-310001777946us-gaap:CommonClassAMember2020-01-310001777946us-gaap:AdditionalPaidInCapitalMember2021-01-310001777946us-gaap:PrivatePlacementMember2021-08-012021-10-310001777946irnt:SoftwareSubscriptionAndSupportRevenueMember2021-08-012021-10-310001777946irnt:ProfessionalServicesRevenueMember2021-02-012021-10-310001777946us-gaap:AdditionalPaidInCapitalMember2021-08-012021-10-310001777946irnt:PrivateWarrantsMember2020-10-310001777946irnt:SubscriptionNotesReceivableMember2020-08-012020-10-310001777946country:US2020-02-012020-10-310001777946irnt:PrivateWarrantsMember2021-02-012021-10-3100017779462021-01-310001777946us-gaap:AdditionalPaidInCapitalMemberirnt:PublicWarrantsMember2021-02-012021-10-310001777946country:US2021-08-012021-10-310001777946us-gaap:OtherCurrentAssetsMember2021-10-310001777946srt:RevisionOfPriorPeriodReclassificationAdjustmentMemberus-gaap:CommonClassBMember2020-01-310001777946us-gaap:RetainedEarningsMember2020-08-012020-10-310001777946us-gaap:CommonClassAMember2021-10-3100017779462018-12-292018-12-290001777946us-gaap:SubsequentEventMemberirnt:TwoThousandTwentyOneEquityIncentivePlanMember2021-11-230001777946irnt:CaresActMemberirnt:PaybackProtectionProgramLoanMember2021-10-310001777946us-gaap:AdditionalPaidInCapitalMember2020-02-012020-10-310001777946us-gaap:CommonClassAMember2021-01-310001777946us-gaap:EmployeeStockOptionMember2021-02-012021-10-310001777946irnt:SubscriptionRevenueMember2021-02-012021-10-310001777946us-gaap:NonUsMember2021-02-012021-10-310001777946irnt:TwoThousandFourteenEquityIncentivePlanMember2021-08-262021-08-260001777946irnt:ProductSubscriptionAndSupportRevenueMember2020-08-012020-10-310001777946irnt:SubscriptionNotesReceivableMember2020-07-310001777946irnt:PublicWarrantsMemberus-gaap:CommonClassAMember2021-02-012021-10-310001777946irnt:SoftwareSubscriptionAndSupportRevenueMember2021-02-012021-10-310001777946irnt:StockIncentivePlanMemberus-gaap:CommonClassAMember2021-10-310001777946irnt:PipeSharesMember2021-08-152021-08-1500017779462020-07-012020-10-310001777946us-gaap:AdditionalPaidInCapitalMemberirnt:PrivateWarrantsMember2021-08-012021-10-310001777946us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2021-10-310001777946us-gaap:SalesRevenueNetMemberus-gaap:CustomerConcentrationRiskMemberirnt:CustomerAMember2021-08-012021-10-310001777946us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-10-310001777946us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-01-310001777946irnt:SubscriptionNotesReceivableMember2021-08-012021-10-310001777946irnt:SoftwareSubscriptionAndSupportRevenueMember2020-08-012020-10-310001777946us-gaap:SalesRevenueNetMembersrt:MinimumMemberus-gaap:CustomerConcentrationRiskMember2021-02-012021-10-310001777946irnt:ProductSubscriptionAndSupportRevenueMember2020-02-012020-10-3100017779462021-08-262021-08-260001777946irnt:PublicWarrantsMember2021-10-3100017779462021-01-312021-01-310001777946us-gaap:SalesRevenueNetMemberirnt:TotalCustomerMemberus-gaap:CustomerConcentrationRiskMember2020-02-012020-10-310001777946country:US2020-08-012020-10-310001777946us-gaap:NonUsMember2020-08-012020-10-310001777946us-gaap:CommonClassAMember2020-08-012020-10-3100017779462020-01-312020-01-310001777946irnt:PublicWarrantsMember2020-10-310001777946us-gaap:RetainedEarningsMembersrt:ScenarioPreviouslyReportedMember2020-01-310001777946irnt:SharesRepurchaseRelatedToLoanPayOffMember2021-10-310001777946irnt:PrivateWarrantsMember2021-08-260001777946srt:ScenarioPreviouslyReportedMemberus-gaap:CommonClassBMember2020-01-310001777946us-gaap:SalesRevenueNetMemberus-gaap:CustomerConcentrationRiskMemberirnt:CustomerAMember2021-02-012021-10-310001777946irnt:RedemptionOfLglClassAMember2021-10-310001777946irnt:LGLSystemsAcquisitionCorpMemberus-gaap:CommonClassAMember2021-10-310001777946us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-01-310001777946us-gaap:SalesRevenueNetMemberirnt:OneCustomerMemberus-gaap:CustomerConcentrationRiskMember2020-02-012020-10-310001777946irnt:SubscriptionRevenueMember2020-08-012020-10-310001777946irnt:LglClassACommonStocksMember2021-10-310001777946us-gaap:RetainedEarningsMember2021-01-3100017779462021-08-012021-10-310001777946us-gaap:CommonClassAMember2020-10-310001777946irnt:SoftwareSubscriptionAndSupportRevenueFromRelatedPartiesMember2021-10-310001777946irnt:LGLSystemsAcquisitionCorpMember2021-10-310001777946irnt:TwoCustomersMember2021-02-012021-10-310001777946irnt:BusinessCombinationAgreementMemberirnt:IronNetCybersecurityIncMember2021-08-262021-08-260001777946us-gaap:RetainedEarningsMember2020-10-310001777946irnt:PaymentsOnSubscriptionNotesReceivableMember2021-10-310001777946srt:RevisionOfPriorPeriodReclassificationAdjustmentMember2020-01-310001777946irnt:SharePriceEqualsOrExceedsDollarsThirteenMemberirnt:BusinessCombinationAgreementMemberirnt:IronNetCybersecurityIncMember2021-08-260001777946irnt:PrivateWarrantsMember2020-02-012020-10-310001777946us-gaap:AdditionalPaidInCapitalMemberirnt:PrivateWarrantsMember2021-02-012021-10-310001777946irnt:EarnoutSharesMember2021-09-102021-09-100001777946irnt:CustomerBMemberus-gaap:SalesRevenueNetMemberus-gaap:CustomerConcentrationRiskMember2021-08-012021-10-310001777946irnt:CaresActMemberirnt:PaybackProtectionProgramLoanMember2020-04-212020-04-210001777946irnt:IssuanceOfCommonStockMember2021-10-310001777946irnt:PublicWarrantsMember2021-02-012021-10-310001777946irnt:LglFoundersSharesMember2021-10-310001777946us-gaap:AdditionalPaidInCapitalMemberirnt:PublicWarrantsMember2021-08-012021-10-310001777946irnt:ProductSubscriptionAndSupportRevenueMember2021-02-012021-10-310001777946irnt:PublicWarrantsMember2021-10-310001777946us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-07-310001777946irnt:ThreeCustomersMemberus-gaap:CustomerConcentrationRiskMemberus-gaap:AccountsReceivableMember2021-02-012021-10-310001777946us-gaap:SalesRevenueNetMemberirnt:TotalCustomerMemberus-gaap:CustomerConcentrationRiskMember2020-08-012020-10-310001777946irnt:CaresActMemberirnt:PaybackProtectionProgramLoanMember2020-10-310001777946irnt:PipeSharesMember2021-08-262021-08-260001777946irnt:IronnetClassACommonStocksMember2021-10-310001777946us-gaap:RetainedEarningsMember2021-02-012021-10-310001777946irnt:CaresActMemberirnt:DueOnDecemberThirtyOneTwoThousandTwentyTwoMemberirnt:ImpactOfPppLoanUnderCaresActMember2022-12-310001777946irnt:SubscriptionNotesReceivableMember2021-02-012021-10-3100017779462021-07-012021-10-310001777946us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-07-310001777946us-gaap:SalesRevenueNetMemberirnt:TotalCustomerMemberus-gaap:CustomerConcentrationRiskMember2021-02-012021-10-310001777946us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-08-012021-10-310001777946us-gaap:SalesRevenueNetMemberus-gaap:CustomerConcentrationRiskMemberirnt:TwoCustomersMember2021-02-012021-10-310001777946us-gaap:AdditionalPaidInCapitalMember2021-10-310001777946irnt:PublicWarrantsMember2021-10-012021-10-310001777946us-gaap:WarrantMember2021-02-012021-10-310001777946us-gaap:SalesRevenueNetMembersrt:MaximumMemberus-gaap:CustomerConcentrationRiskMember2021-02-012021-10-310001777946us-gaap:NonUsMember2021-08-012021-10-310001777946irnt:SubscriptionRevenueMember2020-02-012020-10-310001777946irnt:PublicWarrantsMemberus-gaap:CommonClassAMember2021-08-012021-10-310001777946irnt:CaresActMemberirnt:PaybackProtectionProgramLoanMember2021-04-2100017779462021-06-210001777946us-gaap:CommonClassAMember2021-02-012021-10-310001777946us-gaap:SalesRevenueNetMemberirnt:TotalCustomerMemberus-gaap:CustomerConcentrationRiskMember2021-08-012021-10-310001777946irnt:EarnoutSharesMember2021-10-310001777946irnt:CustomerBMemberus-gaap:SalesRevenueNetMemberus-gaap:CustomerConcentrationRiskMember2021-02-012021-10-310001777946us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2021-01-310001777946irnt:OneCustomerMember2020-02-012020-10-310001777946irnt:PipeSharesMember2021-10-310001777946irnt:PrivateWarrantsMember2021-10-310001777946us-gaap:RetainedEarningsMember2021-10-3100017779462026-02-012021-10-310001777946irnt:SoftwareSubscriptionAndSupportRevenueMember2020-02-012020-10-310001777946irnt:PipeSharesMember2021-08-150001777946irnt:CaresActMemberirnt:ImpactOfPppLoanUnderCaresActMemberirnt:DueOnDecemberThirtyOneTwoThousandTwentyOneMember2021-12-310001777946irnt:PrivateWarrantsMember2021-02-012021-10-310001777946irnt:ProfessionalServicesRevenueMember2020-08-012020-10-310001777946irnt:SubscriptionNotesReceivableMember2020-10-310001777946irnt:ProductSubscriptionAndSupportRevenueMember2021-08-012021-10-310001777946srt:MaximumMemberirnt:SoftwareSubscriptionAndSupportRevenueFromRelatedPartiesMember2021-10-310001777946us-gaap:AdditionalPaidInCapitalMember2020-07-3100017779462020-10-310001777946us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-08-012020-10-310001777946irnt:PrivateWarrantsMember2021-10-310001777946irnt:ProfessionalServicesRevenueMember2020-02-012020-10-3100017779462021-10-310001777946irnt:CaresActMemberirnt:PaybackProtectionProgramLoanMember2020-04-210001777946srt:MinimumMemberirnt:SoftwareSubscriptionAndSupportRevenueFromRelatedPartiesMember2021-10-3100017779462025-02-012021-10-310001777946us-gaap:AdditionalPaidInCapitalMember2021-07-31xbrli:purexbrli:sharesirnt:Segmentirnt:Voteiso4217:USDxbrli:sharesiso4217:USD

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended October 31, 2021

or

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number 001-38183

 

IronNet, Inc.

(Exact name of registrant as specified in its charter)

 

 

Delaware

001-39125

83-4599446

(State or other jurisdiction

of incorporation)

(Commission

File Number)

(IRS Employer

Identification No.)

 

 

 

7900 Tysons One Place, Suite 400

 

 

McLean, VA

 

22102

(Address of principal executive offices)

 

(Zip Code)

 

Registrant’s telephone number, including area code: (443) 300-6761

(Former Name or Former Address, if Changed Since Last Report)

 

 

Title of each class

 

Trading

Symbol(s)

 

Name of each exchange

on which registered

Common Stock, par value $0.0001 per share

 

IRNT

 

The New York Stock Exchange

Warrants to purchase common stock

 

IRNT.WS

 

The New York Stock Exchange

 

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

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

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

 

Accelerated filer

 

Non-accelerated Filer

Smaller reporting company

 

Emerging growth company

 

 

 

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

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

There were 88,718,630 shares of Common Stock, par value $0.0001 per share, outstanding as of December 15, 2021.

 

 


 

IronNet, Inc.

Table of Contents

FORM 10‑Q

October 31, 2021

 

 

 

Page

PART I — FINANCIAL INFORMATION

 

2

Item 1. Financial Statements

 

2

Unaudited Condensed Consolidated Balance Sheets

 

2

Unaudited Condensed Consolidated Statements of Operations

 

3

Unaudited Condensed Consolidated Statements of Comprehensive Loss

 

4

Unaudited Condensed Consolidated Statements of Changes in Stockholders’ Equity

 

5

Unaudited Condensed Consolidated Statements of Cash Flows

 

7

Notes to Unaudited Condensed Consolidated Financial Statements

 

8

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

 

17

Item 3. Quantitative and Qualitative Disclosures About Market Risk

 

26

Item 4. Controls and Procedures

 

27

PART II — OTHER INFORMATION

 

28

Item 1. Legal Proceedings

 

28

Item 1A. Risk Factors

 

28

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

 

28

Item 3. Defaults upon Senior Securities

 

28

Item 4. Mine Safety Disclosures

 

28

Item 5. Other Information

 

28

Item 6. Exhibits

 

29

SIGNATURES

 

30

 

1


 

PART I — FINANCIAL INFORMATION

Item 1. Financial Statements

IronNet, Inc.

Condensed Consolidated Balance Sheets

($ in thousands, except share and per share data)

(unaudited)

 

 

 

October 31,

 

 

January 31,

 

 

 

2021

 

 

2021

 

Assets

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

Cash and cash equivalents

 

$

73,891

 

 

$

31,543

 

Accounts receivable

 

 

2,246

 

 

 

1,643

 

Unbilled receivable

 

 

3,885

 

 

 

1,425

 

Related party receivables and loan receivables

 

 

3,521

 

 

 

3,599

 

Account and loan receivables

 

 

9,652

 

 

 

6,667

 

Inventory

 

 

2,672

 

 

 

2,180

 

Deferred costs

 

 

2,416

 

 

 

2,068

 

Prepaid warranty

 

 

814

 

 

 

1,037

 

Prepaid expenses and other current assets

 

 

4,254

 

 

 

2,172

 

Total current assets

 

$

93,699

 

 

$

45,667

 

Deferred costs

 

 

1,320

 

 

 

2,056

 

Property and equipment, net

 

 

5,596

 

 

 

2,792

 

Prepaid warranty

 

 

897

 

 

 

878

 

Deposits and other assets

 

 

490

 

 

 

298

 

Total assets

 

$

102,002

 

 

$

51,691

 

Liabilities and stockholders’ equity

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

Accounts payable

 

$

4,380

 

 

$

1,922

 

Accrued expenses

 

 

6,196

 

 

 

2,591

 

Deferred revenue

 

 

12,929

 

 

 

12,481

 

Deferred rent

 

 

154

 

 

 

134

 

Short-term PPP loan

 

 

 

 

 

3,487

 

Income tax payable

 

 

135

 

 

 

88

 

Other current liabilities

 

 

689

 

 

 

689

 

Total current liabilities

 

 

24,483

 

 

 

21,392

 

Deferred rent

 

 

808

 

 

 

928

 

Deferred revenue

 

 

17,181

 

 

 

21,563

 

   Warrants

 

 

43

 

 

 

 

Long-term PPP loan

 

 

 

 

 

2,093

 

   Other long-term liabilities payable

 

 

689

 

 

 

689

 

Total liabilities

 

$

43,204

 

 

$

46,665

 

 

 

 

 

 

 

 

Commitments and contingencies (Note 7)

 

 

 

 

 

 

Stockholders’ equity

 

 

 

 

 

 

Preferred stock, $0.0001 par value; 100,000,000 shares authorized; none issued or outstanding

 

 

 

 

 

 

Class A common stock; $0.0001 par value; 500,000,000 shares authorized; 88,718,630 and 65,353,098  shares issued and outstanding at October 31, 2021 and January 31, 2021, respectively

 

 

9

 

 

 

7

 

Additional paid-in capital

 

 

459,349

 

 

 

180,853

 

Accumulated other comprehensive (loss) income

 

 

268

 

 

 

40

 

Accumulated deficit

 

 

(400,828

)

 

 

(175,039

)

Subscription notes receivable

 

 

 

 

 

(835

)

Total stockholders’ equity

 

 

58,798

 

 

 

5,026

 

 Total liabilities and stockholders' equity

 

$

102,002

 

 

$

51,691

 

 

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

2


 

IronNet, Inc.

Condensed Consolidated Statements of Operations

($ in thousands, except per share data)

(unaudited)

 

 

 

Three Months Ended October 31,

 

 

Nine Months Ended October 31,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

Product, subscription and support revenue

 

$

6,132

 

 

$

5,958

 

 

$

18,038

 

 

$

18,047

 

Professional services revenue

 

 

781

 

 

 

1,055

 

 

 

1,327

 

 

 

3,779

 

Total revenue

 

 

6,913

 

 

 

7,013

 

 

 

19,365

 

 

 

21,826

 

Cost of product, subscription and support revenue

 

 

2,082

 

 

 

1,252

 

 

 

5,505

 

 

 

3,534

 

Cost of professional services revenue

 

 

286

 

 

 

817

 

 

 

617

 

 

 

1,596

 

Total cost of revenue

 

 

2,368

 

 

 

2,069

 

 

 

6,122

 

 

 

5,130

 

Gross profit

 

 

4,545

 

 

 

4,944

 

 

 

13,243

 

 

 

16,696

 

Operating expenses

 

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

 

28,144

 

 

 

5,687

 

 

 

42,606

 

 

 

19,965

 

Sales and marketing

 

 

57,196

 

 

 

7,155

 

 

 

72,046

 

 

 

23,265

 

General and administrative

 

 

100,267

 

 

 

4,715

 

 

 

111,952

 

 

 

16,690

 

Total operating expenses

 

 

185,607

 

 

 

17,557

 

 

 

226,604

 

 

 

59,920

 

Operating loss

 

 

(181,062

)

 

 

(12,613

)

 

 

(213,361

)

 

 

(43,224

)

Other (expense) income, net

 

 

(724

)

 

 

178

 

 

 

(1,070

)

 

 

125

 

Change in fair value of warrants liabilities

 

 

(11,302

)

 

 -

 

 

 

(11,302

)

 

 

-

 

Loss before income taxes

 

 

(193,088

)

 

 

(12,435

)

 

 

(225,733

)

 

 

(43,099

)

Benefit (provision) for income taxes

 

 

(34

)

 

 

(19

)

 

 

(56

)

 

 

(58

)

Net loss

 

$

(193,122

)

 

$

(12,454

)

 

$

(225,789

)

 

$

(43,157

)

Basic and diluted net loss per common share

 

 

(2.22

)

 

 

(0.19

)

 

 

(3.05

)

 

 

(0.67

)

Weighted average shares outstanding, basic and diluted

 

 

87,178,432

 

 

 

65,067,942

 

 

 

74,001,217

 

 

 

64,064,424

 

 

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

3


 

IronNet, Inc.

Condensed Consolidated Statements of Comprehensive Loss

($ in thousands) (unaudited)

 

 

 

Three Months Ended October 31,

 

 

Nine Months Ended October 31,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

Net loss

 

$

(193,122

)

 

$

(12,454

)

 

$

(225,789

)

 

$

(43,157

)

Change in net unrealized gains (losses) on available for sale investments,
 net of tax

 

 

 

 

 

(397

)

 

 

 

 

 

(398

)

Foreign currency translations adjustment, net of tax

 

 

303

 

 

 

(54

)

 

 

228

 

 

 

(4

)

     Comprehensive loss

 

$

(192,819

)

 

$

(12,905

)

 

$

(225,561

)

 

$

(43,559

)

 

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

4


 

IronNet, Inc.

Condensed Consolidated Statements of Changes in Stockholders’ Equity

For the Nine Months Ended October 31, 2021 and 2020

($ in thousands, number of preferred stock and common stock in thousands)

(unaudited)

 

 

Series A Preferred Stock

 

Series B Preferred Stock

 

Class A Common Stock

 

Class B Common Stock

 

 

Additional Paid- In Capital

 

 

Accumulated Deficit

 

 

Accumulated Other Comprehensive Deficit

 

 

Subscription Notes Receivables

 

 

Total Stockholders' Equity

 

 

 

Shares

 

 

Amount

 

 

Shares

 

 

Amount

 

 

Shares

 

 

Amount

 

 

 

Shares

 

 

Amount

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at January 31, 2021

 

 

-

 

$

 

-

 

 

 

-

 

$

 

-

 

 

 

66,934

 

$

 

7

 

 

 

 

-

 

$

 

-

 

$

 

180,853

 

$

 

(175,039

)

$

 

40

 

$

 

(835

)

$

 

5,026

 

Issuance of common stock

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

598

 

 

 

-

 

 

 

 

-

 

 

 

-

 

 

 

305

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

305

 

Merger recapitalization (Note 2)

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

4,555

 

 

 

1

 

 

 

 

-

 

 

 

-

 

 

 

(12,027

)

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(12,026

)

PIPE Shares

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

12,500

 

 

 

1

 

 

 

 

-

 

 

 

-

 

 

 

109,857

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

109,858

 

Issuance of common stock related to Public Warrants

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

29

 

 

 

-

 

 

 

 

-

 

 

 

-

 

 

 

330

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

330

 

Issuance of common stock related to Private Warrants

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

3,188

 

 

 

-

 

 

 

 

-

 

 

 

-

 

 

 

21,492

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

21,492

 

Issuance of earnout

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,078

 

 

 

-

 

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Interest earned on subscription notes receivable

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

 

-

 

 

 

-

 

 

 

8

 

 

 

-

 

 

 

-

 

 

 

(8

)

 

 

-

 

Settlement of related party loan receivable for common shares

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(108

)

 

 

-

 

 

 

 

-

 

 

 

-

 

 

 

(1,075

)

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(1,075

)

Payment of note receivable and settlement of note receivables for common shares

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(55

)

 

 

-

 

 

 

 

-

 

 

 

-

 

 

 

(550

)

 

 

-

 

 

 

-

 

 

 

843

 

 

 

293

 

Stock-based compensation

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

 

-

 

 

 

-

 

 

 

160,156

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

160,156

 

Net loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(225,789

)

 

 

-

 

 

 

-

 

 

 

(225,789

)

Foreign currency translation adjustment,
 net of tax of $
0

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

228

 

 

 

-

 

 

 

228

 

Balance at October 31, 2021

 

 

-

 

$

 

-

 

 

 

-

 

$

 

-

 

 

 

88,719

 

$

 

9

 

 

 

 

-

 

$

 

-

 

$

 

459,349

 

$

 

(400,828

)

$

 

268

 

$

 

-

 

$

 

58,798

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at January 31, 2020, as previously reported

 

 

794

 

$

 

32,500

 

 

 

1,217

 

$

 

88,711

 

 

 

36,138

 

$

 

4

 

 

 

 

17,607

 

$

 

2

 

$

 

2,041

 

$

 

(119,666

)

$

 

394

 

$

 

(900

)

$

 

(118,125

)

Retroactive application of recapitalization (1)

 

 

(794

)

 

 

(32,500

)

 

 

(1,217

)

 

 

(88,711

)

 

 

23,984

 

 

 

2

 

 

 

 

(17,607

)

 

 

(2

)

 

 

121,194

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

121,194

 

Adjusted Balance at January 31, 2020

 

 

-

 

$

 

-

 

 

 

-

 

$

 

-

 

 

 

60,122

 

$

 

6

 

 

 

 

-

 

$

 

-

 

$

 

123,235

 

$

 

(119,666

)

$

 

394

 

$

 

(900

)

$

 

3,069

 

Issuance of common stock

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

5,231

 

 

 

1

 

 

 

 

-

 

 

 

-

 

 

 

44,079

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

44,080

 

Interest earned on subscription notes receivable

 

 

-