Warrants |
3 Months Ended |
|---|---|
Mar. 31, 2026 | |
| Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
| Warrants | Warrants
Public Warrants – As of March 31, 2026 there were 11,779,167 Public Warrants outstanding. For every 2,592 Public Warrants, the holder is entitled to purchase one share of Common Stock at a price of $11.50, subject to adjustment. However, no Public Warrants will be exercisable for cash unless we have an effective and current registration statement covering the shares of Common Stock issuable upon exercise of the Public Warrants and a current prospectus relating to such shares of Common Stock. The Public Warrants expire on September 9, 2027, or earlier upon redemption or liquidation. Our Public Warrants are listed on Nasdaq under the symbol “KITTW”.
We may redeem the outstanding Public Warrants, in whole and not in part, at a price of $0.01 per warrant:
•at any time after the Public Warrants become exercisable,
•upon not less than 30 days’ prior written notice of redemption to each warrant holder,
•if, and only if, the reported last sale price of the shares of Common Stock equals or exceeds $42,768 per share (subject to adjustment for splits, dividends, recapitalizations and other similar events), for any 20 trading days within a 30-day trading period ending on the third business day prior to the notice of redemption to warrant holders, and
•if, and only if, there is a current registration statement in effect with respect to the shares of Common Stock underlying such warrants at the time of redemption and for the entire 30-day trading period referred to above and continuing each day thereafter until the date of redemption.
If we call the Public Warrants for redemption as described above, we have the option to require all holders that wish to exercise warrants to do so on a “cashless basis.”
The exercise price and number of shares of Common Stock issuable on exercise of the Public Warrants may be adjusted in certain circumstances including in the event of a share dividend, extraordinary dividend or our recapitalization, reorganization, merger or consolidation.
The Public Warrants, which are accounted for as liabilities in our condensed consolidated balance sheets, were valued as of March 31, 2026 and December 31, 2025 at $1,769 and $1,612, respectively, based on their publicly-traded price. For the three months ended March 31, 2026 and 2025, the Company reported a gain and loss in value of the Public Warrants of $157 and $11,263, respectively. The change in fair value of the Public Warrants was reported within other (income) expense in our condensed consolidated statements of operations.
Private Warrants – We assumed 4,020,833 Private Warrants, which are not publicly traded, on September 9, 2022. These remained outstanding as of March 31, 2026. For every 2,592 Private Warrants, the holder is entitled to purchase one share of Common Stock at an exercise price of $11.50 and is identical in all material respects to the Public Warrants except that the Private Warrants are exercisable for cash (even if a registration statement covering the shares of Common Stock issuable upon exercise of such warrants is not effective) or on a cashless basis, at the holder’s option, and will not be redeemable by us, in each case so long as they are still held by the initial purchasers or their affiliates. The Private Warrants purchased by CleanTech Investments, LLC are not exercisable after 5 years as long as Chardan Capital Markets, LLC or any of its related persons beneficially own these Private Warrants.
The Private Warrants, which are accounted for as liabilities in our condensed consolidated balance sheets, were valued as of March 31, 2026 and December 31, 2025 at $647 and $589, respectively. The fair value of the Private Warrants was estimated using a Black-Scholes option pricing model using the following assumptions: stock price of $4.00, no assumed dividends, a risk-free rate of 3.73%, implied volatility of 275.0%, and a remaining term of 1.44 years. The gain and loss in fair value of the Private Warrants during the three months ended March 31, 2026 and 2025 of $58 and $4,977, respectively, and was reported with other (income) expense in our consolidated statements of operations.
SPA Warrants – On September 9, 2022 and pursuant to the Securities Purchase Agreement, we issued an aggregate 1,127 Original SPA Warrants to the SPA Parties. Upon issuance, each whole Original SPA Warrant was exercisable over its 10-
year term for one share of Common Stock at a price of $51,840 per share, subject to certain adjustments including full ratchet anti-dilution price protections.
On June 22, 2023, we entered into the Letter Agreements with the SPA Parties (the “Letter Agreements”), pursuant to which the SPA Parties (also being the holders of the Original SPA Warrants) agreed to amend the exercise price of the Original SPA Warrants, which, since issuance, had been exercisable to purchase an aggregate 1,127 shares of Common Stock in exchange for the Company’s agreement to (i) lower the exercise price of the Original SPA Warrants to a weighted average of $8,502 per share, with multiple tranches priced between $5,288 and $12,027 per share, and (ii) upon the SPA Parties’ exercise of the Amended SPA Warrants, issue New SPA Warrants to the SPA Parties to purchase, in the aggregate, up to 1,127 shares of Common Stock.
During any period when we shall have failed to maintain an effective registration statement covering the shares of Common Stock issuable upon exercise of the Amended SPA Warrants, the registered holder may exercise its Amended SPA Warrants on a cashless basis pursuant to an available exemption from registration under the Securities Act.
The New SPA Warrants will be (and, with respect to those already issued, are) substantially in the form of the Amended SPA Warrants as described above except that the New SPA Warrants (i) have an exercise price of $51,840 per share (including, for purposes of clarification, full-ratchet anti-dilution on the exercise price and number of underlying shares issuable based on the aggregate exercise price using $51,840 as the base exercise price), (ii) are immediately exercisable upon issuance, and (iii) are exercisable until September 9, 2032.
Unless context otherwise requires, the term “SPA Warrants” means (i) before the entry into the Letter Agreements, the Original SPA Warrants, and (ii) upon and following the entry into the Letter Agreements, (a) the Amended SPA Warrants, and (b) the New SPA Warrants. The SPA Warrants, which are accounted for as liabilities in our consolidated balance sheets, were valued as of March 31, 2026 and 2025 at $5,846 and $9,080, respectively, and were estimated using a Black-Scholes valuation model using the following assumptions: stock price $4.00, implied volatility of 151.4%, and remaining term of 6.5 years. The change in the value of the SPA Warrants during the three months ended March 31, 2026 and 2025 was a loss and gain of $3,235 and $67,128, respectively, and was reported with other (income) expense in our consolidated statements of operations.
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