UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended September 30, 2021

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

For the transition period from to

Commission File Number: 001-39384

VICARIOUS SURGICAL INC.

(Exact name of registrant as specified in its charter)

Delaware		87-2678169
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

78 Fourth Avenue Waltham, Massachusetts		02451
(Address of principal executive offices)		(Zip Code)

617-868-1700

Registrant’s telephone number, including area code

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class	Trading Symbol	Name of Each Exchange on Which Registered
Class A common stock, $0.0001 par value per share	RBOT	The New York Stock Exchange
Warrants to purchase one share of Class A common stock, each at an exercise price of $11.50 per share	RBOT 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 (§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, 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 ☒

As of November 1, 2021, the registrant had 98,832,452 shares of Class A common stock outstanding and 19,789,860 shares of Class B common stock outstanding.

TABLE OF CONTENTS

	Page
PART I: FINANCIAL INFORMATION
Item 1. Financial Statements (unaudited)	1
Condensed Balance Sheets as of September 30, 2021 and December 31, 2020	1
Condensed Statements of Operations and Comprehensive Loss for the Three and Nine Months ended September 30, 2021 and 2020	2
Condensed Statements of Changes in Stockholders’ Equity for the Three and Nine Months ended September 30, 2021 and 2020	3
Condensed Statements of Cash Flows for the Nine Months ended September 30, 2021 and 2020	4
Notes to the Condensed Financial Statements	5
Item 2. Management´s Discussion and Analysis of Financial Condition and Results of Operations	19
Item 3. Quantitative and Qualitative Disclosures about Market Risk	26
Item 4. Controls and Procedures	26
PART II: OTHER INFORMATION
Item 1. Legal Proceedings	27
Item 1A. Risk Factors	27
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	56
Item 3. Defaults Upon Senior Securities	56
Item 4. Mine Safety Disclosures	56
Item 5. Other Information	56
Item 6. Exhibits	57
SIGNATURES	59

In this Quarterly Report on Form 10-Q, the terms “we,” “us,” “our,” the “Company” and “Vicarious Surgical” mean Vicarious Surgical Inc. (formerly D8 Holdings Corp.) and our subsidiaries. On September 17, 2021 (the “Closing Date”), D8 Holdings Corp., a Delaware corporation that was previously a Cayman Islands exempted company that migrated to and domesticated (“D8” and after the Business Combination described herein, the “Company”), consummated the previously announced business combination (the “Business Combination”) pursuant to the terms of the Agreement and Plan of Merger, dated as of April 15, 2021 (the “Business Combination Agreement”), by and among D8, Snowball Merger Sub, Inc., a Delaware corporation (“Merger Sub”), and Vicarious Surgical Inc., a Delaware corporation (“Legacy Vicarious”). Immediately upon the consummation of the Business Combination and the other transactions contemplated by the Business Combination Agreement (collectively, the “Transactions”, and such completion, the “Closing”), Merger Sub merged with and into Legacy Vicarious, with Legacy Vicarious surviving the Business Combination as a wholly-owned subsidiary of D8 (the “Merger”). In connection with the Transactions, D8 changed its name to “Vicarious Surgical Inc.” and Legacy Vicarious changed its name to “Vicarious Surgical US Inc.”

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that relate to future events, our future operations or financial performance, or our plans, strategies and prospects. These statements are based on the beliefs and assumptions of our management team. Although we believe that our plans, intentions and expectations reflected in or suggested by these forward-looking statements are reasonable, we cannot assure that we will achieve or realize these plans, intentions or expectations. Forward-looking statements are inherently subject to risks, uncertainties and assumptions. Generally, statements that are not historical facts, including statements concerning possible or assumed future actions, business strategies, events or performance, are forward-looking statements. These statements may be preceded by, followed by or include the words “believes,” “estimates,” “expects,” “projects,” “forecasts,” “may,” “will,” “should,” “seeks,” “plans,” “scheduled,” “anticipates” or “intends” or the negative of these terms, or other comparable terminology intended to identify statements about the future, although not all forward-looking statements contain these identifying words. The forward-looking statements are based on projections prepared by, and are the responsibility of, the Company’s management. Forward-looking statements contained in this Quarterly Report on Form 10-Q include, but are not limited to, statements about:

●

the ability to recognize the anticipated benefits of the Business Combination, which may be affected by, among other things, competition and our ability to grow and manage growth profitably and retain our key employees;

●

the ability to maintain the listing of our Class A common stock on the NYSE;

●

the success, cost and timing of our product and service development activities;

●

the commercialization and adoption of our initial products and the success of the Vicarious System and any of our future product and service offerings;

●

the potential attributes and benefits of the Vicarious System and any of our other product and service offerings once commercialized;

●

our ability to obtain and maintain regulatory approval for the Vicarious System and our product and service offerings, and any related restrictions and limitations of any approved product or service offering;

●

our business is subject to a variety of U.S. and foreign laws, which are subject to change and could adversely affect our business;

●

our ability to identify, in-license or acquire additional technology;

●

our ability to maintain our existing license agreements and manufacturing arrangements;

●

our ability to compete with other companies currently marketing or engaged in the development of products and services for ventral hernia repair and additional surgical applications, many of which have greater financial and marketing resources than us;

●

the size and growth potential of the markets for the Vicarious System and any of our future product and service offerings, and the ability of each to serve those markets once commercialized, either alone or in partnership with others;

●

our estimates regarding expenses, future revenue, capital requirements and needs for additional financing;

●

our ability to raise financing in the future;

●

our financial performance;

●

our intellectual property rights and how failure to protect or enforce these rights could harm our business, results of operations and financial condition

●

economic downturns and political and market conditions beyond our control and their potential to adversely affect our business, financial condition and results of operations;

●

the anticipated continued impact of the COVID-19 pandemic on our business; and

●

other factors detailed under the section titled “Risk Factors.”

These forward-looking statements are based on information available as of the date of this report, and current expectations, forecasts and assumptions, and involve a number of judgments, risks and uncertainties. Important factors could cause actual results, performance or achievements to differ materially from those indicated or implied by forward-looking statements such as those described under the caption “Risk Factors” in Item 1A of Part II of this Quarterly Report on Form 10-Q and in other filings that we make with the Securities and Exchange Commission. The risks described under the heading “Risk Factors” are not exhaustive. New risk factors emerge from time to time, and it is not possible to predict all such risk factors, nor can we assess the impact of all such risk factors on our business or the extent to which any factor or combination of factors may cause actual results to differ materially from those contained in any forward-looking statements. Forward-looking statements are not guarantees of performance. You should not put undue reliance on these statements, which speak only as of the date hereof. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the foregoing cautionary statements. We undertake no obligations to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.

VICARIOUS SURGICAL INC.

UNAUDITED CONDENSED BALANCE SHEETS

(in thousands, except share and per share data)

	September 30,			December 31,
	2021			2020
Assets
Current assets:
Cash and cash equivalents	$	185,046		$	16,867
Prepaid expenses and other current assets		6,179			258
Total current assets		191,225			17,125
Restricted cash		622			118
Property and equipment, net		1,517			445
Other long-term assets		—			100
Total assets	$	193,364		$	17,788

Liabilities, Convertible Preferred Stock and Stockholders’ Equity
Current liabilities:
Accounts payable	$	848		$	373
Accrued expenses		1,615			394
Current portion of equipment loans		47			47
Current portion of term loan		600			—
Total current liabilities		3,110			814
Deferred rent		1,467			58
Equipment loans, net of current portion		28			63
Term loan, net of current portion and issuance costs		836			—
Warrant liabilities		178,287			—
Total liabilities		183,728			935

Commitments and Contingencies (Note 8)

Legacy convertible preferred stock (Note 10)		—			—

Stockholders’ equity:
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; no shares issued or outstanding at September 30, 2021 and December 31, 2020		—			—
Class A Common stock, $0.0001 par value; 300,000,000 and 200,000,000 shares authorized at September 30, 2021 and December 31, 2020, respectively; 98,832,452 and 67,640,740 shares issued and outstanding at September 30, 2021 and December 31, 2020, respectively		10			7
Class B Common stock, $0.0001 par value; 22,000,000 and 20,000,000 shares authorized at September 30, 2021 and December 31, 2020, respectively; 19,789,860 and 19,572,257 shares issued and outstanding at September 30, 2021 and December 31, 2020, respectively		2			2
Additional paid-in capital		118,563			48,435
Accumulated deficit		(108,939	)		(31,591	)
Total stockholders’ equity		9,636			16,853

Total liabilities and stockholders’ equity	$	193,364		$	17,788

See accompanying notes to these financial statements.

VICARIOUS SURGICAL INC.

UNAUDITED CONDENSED STATEMENTS OF OPERATIONS

(in thousands except, per share data)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2021			2020			2021			2020
Operating expenses:
Research and development	$	5,189		$	2,504		$	12,804		$	6,831
Sales and marketing		842			362			1,393			776
General and administrative		2,530			475			6,206			1,594
Total operating expenses		8,561			3,341			20,403			9,201
Loss from operations		(8,561	)		(3,341	)		(20,403	)		(9,201	)
Other income (expense):
Change in fair value of warrant liabilities		(56,887	)		—			(56,887	)		—
Interest income		—			1			1			114
Interest expense		(31	)		(1	)		(59	)		(4	)
Loss before income taxes		(65,479	)		(3,341	)		(77,348	)		(9,091	)
Provision for income taxes		—			—			—			—
Net loss and comprehensive loss	$	(65,479	)	$	(3,341	)	$	(77,348	)	$	(9,091	)
Net loss per share of Class A and Class B common stock, basic and diluted	$	(0.71	)	$	(0.04	)	$	(0.87	)	$	(0.12	)

See accompanying notes to these financial statements.

VICARIOUS SURGICAL INC.

UNAUDITED CONDENSED STATEMENTS OF CONVERTIBLE PREFERRED
STOCK, COMMON STOCK AND STOCKHOLDERS’ EQUITY

(In thousands, except share data)

	Three Months Ended September 30, 2021
	Convertible						Class A & B				Additional					Total
	Preferred Stock						Common Stock				Paid-In		Accumulated			Stockholders’
	Shares			Amount			Shares		Amount		Capital		Deficit			Equity
Balance, June 30, 2021		66,550,929		$	46,670			21,315,731	$	2	$	2,508	$	(43,460	)	$	(40,950	)
Retroactive application of recapitalization (Note 1)		(66,550,929	)		(46,670	)		66,550,929		7		46,663		—			46,670
Adjusted balance, beginning of period		—			—			87,866,660		9		49,171		(43,460	)		5,720
Reverse recapitalization, net of transaction costs (Note 1)		—			—			30,579,972		3		69,021		—			69,024
Cashless exercise of warrants		—			—			146,577		—		—		—			—
Exercise of common stock options		—			—			29,103		—		4		—			4
Stock-based compensation		—			—			—		—		367		—			367
Net loss		—			—			—		—		—		(65,479	)		(65,479	)
Balance, September 30, 2021		—		$	—			118,622,312	$	12	$	118,563	$	(108,939	)	$	9,636

	Nine Months Ended September 30, 2021
	Convertible						Class A & B				Additional					Total
	Preferred Stock						Common Stock				Paid-In		Accumulated			Stockholders’
	Shares			Amount			Shares		Amount		Capital		Deficit			Deficit
Balance, January 1, 2021		66,550,929		$	46,670			20,662,068	$	2	$	1,772	$	(31,591	)	$	(29,817	)
Retroactive application of recapitalization (Note 1)		(66,550,929	)		(46,670	)		66,550,929		7		46,663		—			46,670
Adjusted balance, beginning of period		—			—			87,212,997		9		48,435		(31,591	)		16,853
Reverse recapitalization, net of transaction costs (Note 1)		—			—			30,579,972		3		69,021		—			69,024
Cashless exercise of warrants		—			—			146,577		—		—		—			—
Exercise of common stock options		—			—			465,163		—		115		—			115
Stock-based compensation		—			—			—		—		992		—			992
Vesting of restricted stock		—			—			217,603		—		—		—			—
Net loss		—			—			—		—		—		(77,348	)		(77,348	)
Balance, September 30, 2021		—		$	—			118,622,312	$	12	$	118,563	$	(108,939	)	$	9,636

	Three Months Ended September 30, 2020
	Convertible						Class A & B				Additional						Total
	Preferred Stock						Common Stock				Paid-In			Accumulated			Stockholders’
	Shares			Amount			Shares		Amount		Capital			Deficit			Deficit
Balance, June 30, 2020		52,885,027		$	33,150			18,920,979	$	2	$	1,354		$	(24,466	)	$	(23,110	)
Retroactive application of recapitalization (Note 1)		(52,885,027	)		(33,150	)		52,885,027		5		33,142			—			33,150
Adjusted balance, beginning of period		—			—			71,806,006		7		34,496			(24,466	)		10,040
Series A-3 financing, net issuance cost of $95								13,248,632		1		13,104			—			13,105
Exercise of common stock options		—			—			302,752		—		36			—			36
Stock-based compensation		—			—			—		—		176			—			176
Vesting of restricted stock		—			—			652,788		1		(1	)		—			—
Net loss		—			—			—		—		—			(3,341	)		(3,341	)
Balance, September 30, 2020		—		$	—			86,010,178	$	9	$	47,811		$	(27,807	)	$	20,016

	Nine Months Ended September 30, 2020
	Convertible						Class A & B				Additional						Total
	Preferred Stock						Common Stock				Paid-In			Accumulated			Stockholders’
	Shares			Amount			Shares		Amount		Capital			Deficit			Deficit
Balance, January 1, 2020		52,885,027		$	33,150			17,613,962	$	2	$	1,196		$	(18,716	)	$	(17,518	)
Retroactive application of recapitalization (Note 1)		(52,885,027	)		(33,150	)		52,885,027		5		33,142			—			33,150
Adjusted balance, beginning of period		—			—			70,498,989		7		34,338			(18,716	)		15,632
Series A-3 financing, net issuance cost of $95		—			—			13,248,632		1		13,104			—			13,105
Exercise of common stock options		—			—			304,193		—		36			—			36
Stock-based compensation		—			—			—		—		334			—			334
Vesting of restricted stock		—			—			1,958,364		1		(1	)		—			—
Net loss		—			—			—		—		—			(9,091	)		(9,091	)
Balance, September 30, 2020		—		$	—			86,010,178	$	9	$	47,811		$	(27,807	)	$	20,016

See accompanying notes to these financial statements.

VICARIOUS SURGICAL INC.

UNAUDITED CONDENSED STATEMENTS OF CASH FLOWS

(in thousands)

	Nine Months Ended
	2021	2020
Cash flows from operating activities:

SEC Form 10-Q filed by Vicarious Surgical Inc.