##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, DC 20549
 FORM 10-K
  þ
    
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 FOR THE FISCAL YEAR ENDED DECEMBER 31, 2010
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 Commission File Number 001-33169
 Wireless Ronin Technologies, Inc.
 (Exact name of registrant as specified in its charter)
 Minnesota
    
    41-1967918(State or other jurisdiction of
incorporation or organization)
    
    (I.R.S. Employer
Identification No.)
 5929 Baker Road, Suite 475, Minnetonka MN 55345
 (Address of principal executive offices) ( Zip Code)
 (952) 564-3500
 (Registrants telephone number, including area code)
  Common Stock ($0.01 par value)
    
    Nasdaq Capital Market(Title of class)
    
    (Name of each exchange on which registered)
 None
 o þ
 o þ
 þ o
 o
 o o
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer o
    
    Smaller reporting company þ(Do not check if a smaller reporting company)
 o þ
   DOCUMENTS INCORPORATED BY REFERENCE




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TABLE
OF CONTENTS
 PART I
    
    
    1ITEM 1 BUSINESS
    
    
    1ITEM 1A RISK FACTORS
    
    
    15ITEM 1B UNRESOLVED STAFF COMMENTS
    
    
    26ITEM 2 PROPERTIES
    
    
    26ITEM 3 LEGAL PROCEEDINGS
    
    
    26ITEM 4 (Removed and Reserved)
    
    
    26PART II
    
    
    27ITEM 5 MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
    
    
    27ITEM 6 SELECTED FINANCIAL DATA
    
    
    28ITEM 7 MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
    
    
    29ITEM 7A QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
    
    
    43ITEM 8 FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
    
    
    43ITEM 9 CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
    
    
    44ITEM 9A CONTROLS AND PROCEDURES
    
    
    44ITEM 9B OTHER INFORMATION
    
    
    45PART III
    
    
    45ITEM 10 DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
    
    
    45ITEM 11 EXECUTIVE COMPENSATION
    
    
    45ITEM 12 SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
    
    
    45ITEM 13 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
    
    
    45ITEM 14 PRINCIPAL ACCOUNTANT FEES AND SERVICES
    
    
    46PART IV
    
    
    46ITEM 15 EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
    
    
    46SIGNATURES
    
    
    47INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
    
    
    F-1EXHIBIT INDEX
    
    
    E-1
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##### Table of Contents



PART I
 
 ITEM 1 BUSINESS
 Overview
 ® ®
  Business Strategy
  Focus on Vertical Markets.
 Leverage Strategic Relationships.
 Market and Brand Our Products and Services Effectively. ®
 Outsource Operating Functions.
 1




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Create Custom Solutions. ®
 Create Content Solutions.
 Develop New Products.
 Industry Background
 Digital Signage
   Growth of Digital Signage
  
    
    Changes in the advertising landscape. Media expenditures since the 1950s have gone
primarily to television, followed by newspapers, magazines and commercial radio. But
this 50-year trend has now realized its apex, with generational declines in consumption
among Gen X and Gen Y. A February 12, 2007 article in Media Week states that where we
used to have only web-portals and sites, we now have Voice Over Internet Protocal
(VOIP) telephony, digital signage and mobile media. The descending triangle of
traditional media is being displaced by the ascending triangle of Internet-enabled
media, composed of web-based media, e-mail, mobile media and digital-signage media. The
Internet is now blending with out-of-home networked media to form this rapidly
integrated media cluster, which is displacing the descending media triangle of
television, print, and commercial radio.
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
    
    Growing awareness that digital signage is more effective.Research presented at the
2005 Digital Signage Business conference shows that digital signage receives up to 10
times the eye contact of static signage and, depending upon the market, may
significantly increase sales for new products that are digitally advertised. A study by
Arbitron, Inc. found that 29% of the consumers who have seen video in a store say they
bought a product they were not planning on buying after seeing the product featured on
the in-store video display. We believe that our dynamic digital signage solutions
provide a valuable alternative to advertisers currently using static signage.
    
    Decreasing hardware costs associated with digital signage.The high cost of
monitors and media players has been an obstacle of digital signage implementation for a
number of years. The price of digital display panels and media players has been falling
due to increases in component supplies and manufacturing capacity. As a result, we
believe that hardware costs are likely to continue to decrease, which would provide
faster return on investment (ROI), resulting in continued growth in this market.
    
    Compliance and effectiveness issues with traditional point-of-purchase signage.Our
review of the current market indicates that most retailers go through a tedious process
to produce traditional static point-of-purchase and in-store signage. They create
artwork, send such artwork to a printing company, go through a proof and approval
process and then ship the artwork to each store. According to a February 2006 article
in The Retail Bulletin (February 19, 2006), it is estimated that less than 50% of all
static in-store signage programs are completely implemented once they are delivered to
stores. We believe our signage solution can enable prompt and effective implementation
of retailer signage programs, thus significantly improving compliance and
effectiveness. We believe calorie information compliance rules, as seen in New York and
other states, along national legislation and pending rule making requiring certain
restaurants with 20 or more locations to prominently display calorie information,
represent additional opportunity within the digital signage industry.
 The RoninCast®X Solution
 ® iShowroom
 ®
  ®
  3




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Features and benefits of the RoninCast® system include:
 
    
    Centrally Controlled or Various Levels of Network Access. RoninCast®X software
empowers the end-user to distribute content from one central location or pre-assign
various levels of password-protected access. As a result, real-time marketing decisions
can be managed in-house by a single individual or by pre-designated content; ensuring
retailers communication with customers is executed system-wide at the right time and
the right place. Our content management software recognizes the receipt of new content,
displays the content, and reports back to the central location(s) that the media player
is working properly.
    
    Secure Wireless or Wired Delivery. RoninCast®X software can distribute content
within an installation that is wired (Ethernet connection) or wireless. RoninCast®X
software is compatible with current wireless networking technology and does not require
additional capacity within an existing network. RoninCast®X software uses Wireless
Local Area Network (WLAN) or wireless data connections to establish connectivity. By
installing or using an existing onsite WLAN, the RoninCast®X digital signage solution
can be incorporated throughout the venue without any environmental network cabling. We
also offer our cellular communications solution for off-site signage where WLAN is not
in use or practical.
    
    Ease and Speed of Message Delivery. Changing market developments or events can be
quickly incorporated into our system. The end-user may create entire content
distributions on a daily, weekly or monthly basis. Furthermore, the system allows the
end-user to interject quick daily updates to feature new or overstocked items and then
automatically return to the previous content schedule.
    
    Content Playback and Reporting/Data Collection. RoninCast®X software provides users
the ability to retrieve play logs from media players to review what has played for
invoicing and advertising management. In addition, through interactive touch screen
technology, RoninCast®X software can capture user data and information. This
information can provide feedback to both the customer and the marketer. The ability to
track customer interaction and data mine user profiles, in a non-obtrusive manner, can
provide our customers feedback that would otherwise be difficult to gather.
    
    Integrated Applications. RoninCast®X software can integrate digital signage with
other applications and databases including point-of-sale. RoninCast®X software is able
to use a database feed, RSS, Web Service feed to change the content or marketing
message, making it possible for our customers to deliver targeted messages. Data feeds
can be available either internally within a business or externally through the
Internet. For example, our customers can specify variable criteria or conditions which
RoninCast®X software will analyze, delivering marketing content relevant to the
changing environment. This data can come from a myriad of sources, such as
point-of-sale systems in a retail store or a slot-machine manager in a casino.
    
    Scalability/Mobility. The RoninCast®X system provides the ability to easily move
signage or scale-up to incorporate additional digital signage. Displays can be moved
to or from any location under a wireless network. Customers are able to accommodate
adds/moves/changes within their environment without rewiring network connections.
When the customer wants to add additional digital signage, only electrical power needs
to be supplied at the new location.
    
    Compliance/Consistency. RoninCast®X software addresses compliance and consistency
issues associated with print media and alternative forms of visual marketing.
Compliance measures the frequency of having the marketing message synchronized
primarily with product availability and price. Compliance issues cause inconsistencies
in pricing, product image and availability, and store policies. RoninCast®X software
addresses compliance by allowing message updates and flexible control of a single
location or multiple locations network-wide. RoninCast®X software allows our customers
to
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display messages, pricing, images and other information on websites that are identical to
those displayed at retail locations.
    
    Network Control. Each remote media player is uniquely identified and distinguished
from other units as well as between multiple locations. RoninCast®X software gives the
end-user the ability to view the media players status to determine if the player is
functioning properly and whether the correct content is playing. A list of all units on
the system is displayed, allowing the end-user to view single units or clusters of
units. The system also allows the end-user to receive information regarding the health
of the network before issues occur. In addition, display monitors can be turned on or
off remotely.
 Industry Recognition
  
    
    Overall Network powered by our RoninCast® software in the Hospitality category;
and
    
    Innovative and Interactive for ARAMARKs ordering kiosk which allows their
customers to Build Your Own Burger.
  QSR QSR
 Our Markets
   Automotive. RoninCast® for Automotive
 Food Service. QSR (Quick Serve Restaurant), Fast Casual, and Managed Food Services.
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Branded Retail.
 Select Customers
  
    
    Chrysler RNIN Canada has provided goods and services to Chrysler since 2001,
including digital content creation services, e-learning tools and a data-driven touch
screen kiosk program. The initial touch screen kiosk program used throughout
Chryslers dealer network was called the Chrysler Vehicle Information Centre. Since
2009 we have been working with Chrysler on a next generation system called iShowroom.
Chryslers U.S. dealerships can use the proprietary iShowroom product either in a
personal computer only configuration, which is provided by Chrysler to each of its U.S.
dealerships, or through a digital signage kiosk located on the showroom floor, which we
jointly market with Chrysler to its dealers. Additionally, Chrysler launched Branded
Tower Salons in 2010 promoting each of their four brands, Jeep, Ram, Chrysler and
Dodge, through the iShowroom application to its dealership network. The dealerships
are incentivized to adopt the Branded Tower Salons as part of Chryslers Dealer
Standards Program, which determines the amount of quarterly marketing dollars provided
by Chrysler to its dealerships. As of December 31, 2010, we had received purchase
orders for 200 dealers from Chrysler for the Branded Tower Salons. We also continue to
provide additional content development services to Chrysler that feature Chrysler
products as they are displayed on iShowroom digital signage systems. Sales to
Chrysler, including sales to its former advertising agency BBDO Detroit/Windsor,
represented 46.7% and 14.3% of total sales in 2010 and 2009, respectively.
    
    ARAMARK We have provided goods and services to ARAMARK for its operations in the
food service industry since April 2008. ARAMARK provides managed food service to
colleges, universities, healthcare institutions, sports and entertainment venues,
conference centers and other private and public gathering places. While ARAMARK is not
our only customer in the food industry, it is our only customer that provides managed
food service. We have received purchase orders from ARAMARKs Higher Education division
to support menu boards and touch screens on university campuses, including its Burger
Studio and Topio brands. Additionally, ARAMARK has placed orders for our product
services at elementary and secondary schools. Sales to ARAMARK represented 13.9% and
21.7% of our total sales in 2010 and 2009, respectively.
    
    Thomson Reuters We have provided goods and services to Thomson Reuters in
connection with Thomson Reuters InfoPoint digital signage system since June 2007. The
InfoPoint digital signage system is a lifestyle, news, information and pictures-based
digital signage display network designed for the out-of-home market. We continued to
expand the number of InfoPoint digital signage locations pursuant to additional
purchase orders received in 2010. Additionally, we received an order to deploy
InfoPoint at 50 sites for a financial services institution with over 3,000 locations.
During 2010 Thomson Reuters launched a new interactive application, Reuters Insider,
which is also fully supported by our RoninCast® software. As of December 31, 2010, we
provided 24-hour per day hosting and support services to over 350 locations for Thomson
Reuters. Sales to Thomson Reuters represented 11.9% and 15.8% of total sales in 2010
and 2009, respectively.
    
    YUM!/KFC Since December 2007, we have provided goods and services to KFC, an
entity operating in the quick service restaurant QSR industry. We have provided goods
and services in connection with KFCs implementation of digital menu boards in
restaurants in seven metropolitan areas selected by KFC. Those digital menu boards
have been installed in both KFC-owned and franchise restaurant
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locations. We continued to expand our relationship with KFC and its parent, YUM
Restaurants Services Group, Inc. (YUM!), in 2010, which included deploying 10
KFC/TacoBell combo stores. The total number of stores being monitored by our NOC as of
the end of 2010 was over 200 locations across five countries. KFC restaurants in Las
Vegas, Austin, Oklahoma City, Orlando, Jacksonville and Louisville are now 100% digital.
We also deployed a custom content management web-portal for KFC corporate and its
franchisee operators, which allows for the online management of content, day-parting and
monthly scheduling of the digital menu boards. Sales to YUM!/KFC represented 6.6% of
total sales in 2010. Sales to KFC represented 10.1% of total sales in 2009.
 NEC Reseller Agreement
 ® ® ®
 Product Description
 ®
 
 ®
 RoninCast®X Server Software Suite
 ®
 Web-Based Management System (WBMS) ®
 ®
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
    
    Network Manager this allows digital signage operators to manage their
network of screens and organize them in groups to simplify control, updates,
monitoring and reporting. Network groups can follow any business concept
whether it is location based, time zone based, location type or any other
concept. Virtual grouping allows the operators to create as many groups as
needed to target the entire network, a group of screens or down to individual
screens.
    
    Content Scheduler the content scheduler provides a timeline view for each
content zone with flexible view options. Operators can view schedules over a
years length of time or down to seconds. The content scheduler offers system
users a powerful yet simple interface to perform complex scheduling tasks such
as content playback repeats or recurrence (daily, weekly and monthly) over
different types of content. It also allows operators to create and maintain
content playlists and target a specific zone or multiple zones.
    
    Content Management System(CMS)  the CMS is one of the customizable WBMS
components. Using the CMS, operators have the ability to manage their content
such as items and prices on menu boards, specials, promotions and other
updatable content.
    
    Network Monitoring RoninCast®X offers digital signage operators three main
network monitoring functions within the WBMS. Other monitoring and alert
notification functions are available through different means such as email,
reports and NOC functions.
    
    Reporting reporting includes both standard system reports and client
customized reports. Standard system reports provide an overview of system
operations while customized reports are client-specific.
 Distribution Server
 Data Processing Server
 Software Update Server
 Integration Services ® ®
 RoninCast®X Client Software Suite
 ®
 Media Player
 Macromedia Flash
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Catalog Manager
 Data Integration Layer (DIL)
 Device Health, Diagnosis and Repair Modules
 Software and Content Updates Modules
 External Player Services
 Key Components
  User-Friendly Network Control
 ® ®
 Diverse Media and Authoring Choices
 ® ® ®
 Intelligent Content Distribution
 ®
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®
 ®
 Distributed Management
 ® ®
 Enterprise-Level Compatibility
 ® ® ®
 Flexible Network Design
 ® ®
 ®
  Security
 ® ®
 ® ®
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® ®
 ®
 ® ®
 Our Suppliers
  
    
    NEC Display Solutions, Viewsonic and LG for monitors;
 
    
    ASI and Seneca Data for computers;
 
    
    Chief Manufacturing, Inc. and Peerless for fixtures; and
 
    
    Rollouts, PRS, Spencer Technologies and Field Solutions for installation services.
  Ongoing Development
  Services
   Consulting:
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Creative:
 Content Engineering:
 Content Deployment:
 Project Management:
 Fixturing: ®
 Installation:
 Training: ®
 Hosting:
 Maintenance and Support:
 Intellectual Property
 ®
   
    
    WIRELESS RONIN®
    
    RONIN CAST®
    
    RONINCAST and Design®
    
    WR and Design®
    
    RONINCAST® and Design (Color Logo)
    
    WR (Circle Design)®
    
    COMMUNICATING AT LIFE SPEED®
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
    
    RONIN CAST and Design®
    
    RONINCAST® and Design (Color Logo)
    
    WR (Circle Design)®
    
    COMMUNICATING AT LIFE SPEED®
  
    
    RONIN CAST®
    
    RONIN CAST and Design®
    
    RONINCAST® Design (Color Logo)
    
    COMMUNICATING AT LIFESPEED.
  Competition
  Territories
  Regulation
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Employees
  Executive Officers of the Registrant
  Name
    
    Age
    
    Position with CompanyScott W. Koller
    
    
    49
    
    
    President and Chief Executive OfficerDarin P. McAreavey
    
    
    42
    
    
    Senior Vice President and Chief Financial Officer
 Scott W. Koller
 Darin P. McAreavey
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ITEM 1A RISK FACTORS
 The following are certain risk factors that could affect our business, financial condition,
operating results and cash flows. These risk factors should be considered in connection with
evaluating the forward-looking statements contained in this Annual Report on Form 10-K because
these risk factors could cause our actual results to differ materially from those expressed in any
forward-looking statement. The risks we have highlighted below are not the only ones we face. If
any of these events actually occur, our business, financial condition, operating results or cash
flow could be negatively affected. We caution you to keep in mind these risk factors and to
refrain from attributing undue certainty to any forward-looking statements, which speak only as of
the date of this report.
 Risks Related to Our Business
 Our operations and business are subject to the risks of an early stage company with limited
revenue and a history of losses, operating in a developing industry We have incurred losses since
inception, and we have had only limited revenue. We may not ever become or remain profitable.
    Our success depends on our RoninCast software and services achieving and maintaining
widespread acceptance in our targeted markets. If our products contain errors or defects, our
business reputation may be harmed.
 ® ®
 
    
    our ability to demonstrate RoninCast® softwares economic and other benefits;
    
    our customers becoming comfortable with using RoninCast® software; and
    
    the reliability of the RoninCast® software and the hardware comprising our digital signage systems.
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Difficult and volatile conditions in the capital, credit and commodities markets and general
economic uncertainty have prompted companies to cut capital spending worldwide and could continue
to materially adversely affect our business.
  
 
 
 
 
  Because we do not have long-term purchase commitments from our customers, the failure to
obtain anticipated orders or the deferral or cancellation of commitments could have adverse effects
on our business.
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Most of our contracts are terminable by our customers with limited notice and without penalty
payments, and early terminations could have a material effect on our business, operating results
and financial condition.
  We may experience fluctuations in our quarterly operating results.
  Due to our dependence on a limited number of customers, we are subject to a concentration of
credit risk.
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The integration and operation of an acquired business may disrupt our business and create
additional expenses and we may not achieve the anticipated benefits of the acquisition. In the
event we elect to expand our business through acquisitions, we cannot assure that such future
acquisitions, if pursued and consummated, will be advantageous or profitable.
   Our prospective customers often take a long time to evaluate our products, with this lengthy
and variable sales cycle making it difficult to predict our operating results.
  
    
    reduced need to upgrade existing visual marketing systems;
    
    introduction of products by our competitors;
    
    lower prices offered by our competitors; and
    
    changes in budgets and purchasing priorities.
  Adequate funds for our operations may not be available, requiring us to curtail our activities
significantly.
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Difficulty in developing and maintaining relationships with third party manufacturers,
suppliers and service providers could adversely affect our ability to deliver our products and meet
our customers demands.
  Reductions in hardware costs will likely decrease hardware pricing to our customers and would
reduce our per unit revenue.
  Because our sales approach currently includes strategic partners and business alliances, we
expect to face risks not faced by companies with only internal sales forces.
  
    
    we may not be able to adequately train our strategic
partners and those with which we have business alliances to
sell and service our software and services;
    
    they may emphasize competitors products or decline to promote and sell our software and services;
    
    arrangements with our partners and business alliances can be terminated by either party at
any time and do not require any material financial commitment;
    
    channel conflict may arise between other third parties and/or our internal sales staff; and
    
    software to manage content may be given away.
 Hardware companies may include digital signage software with functionality similar to
RoninCast® as an integrated hardware and software solution, which could have a material adverse
effect on our business.
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® ® ® ®
 Our industry is characterized by frequent technological change. If we are unable to adapt our
products and services and develop new products and services to keep up with these rapid changes, we
will not be able to obtain or maintain market share.
  ®
 Our future success depends on key personnel and our ability to attract and retain additional
personnel.
  
    
    Scott W. Koller, our President and Chief Executive Officer; and
    
    Darin P. McAreavey, our Senior Vice President and Chief Financial Officer.
  Our results of operations may depend upon selling our products and services to customers
requiring large-scale rollouts and large-scale monitoring and maintenance, which we have not
previously conducted.
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Our ability to execute our business strategy depends on our ability to protect our
intellectual property, and if any third parties make unauthorized use of our intellectual property,
or if our intellectual property rights are successfully challenged, our competitive position and
business could suffer.
  ®
 Our industry is characterized by frequent intellectual property litigation, and we could face
claims of infringement by others in our industry. Such claims are costly and add uncertainty to our
business strategy.
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
    
    pay substantial damages;
    
    cease the development, use, licensing or sale of infringing products;
    
    discontinue the use of certain technology; or
    
    obtain a license under the intellectual property rights of
the third party claiming infringement, which license may not
be available on reasonable terms or at all.
 Our business may be adversely affected by malicious applications that interfere with, or
exploit security flaws in, our products and services.
  We compete with other companies that have more resources, which puts us at a competitive
disadvantage.
   We may be subject to sales and other taxes, which could have adverse effects on our business.
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We may be subject to U.S. and international tax authorities challenging our transfer price
allocation, which could have adverse effects on our business.
  Our results of operations could be adversely affected by changes in foreign currency exchange
rates, particularly fluctuations in the exchange rate between the U.S. dollar and the Canadian
dollar.
  We are subject to various restrictive covenants under our agreement with Silicon Valley Bank
which may prevent us from taking actions that could be beneficial to our shareholders without
Silicon Valley Banks consent, including mergers, acquisitions and the incurrence of additional
indebtedness.
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We could have liability arising out of our previous sales of unregistered securities.
  Risks Related to Our Securities
 We are subject to financial reporting and other requirements for which our accounting, other
management systems and resources may not be adequately prepared.
    If we fail to comply with the NASDAQ requirements for continued listing, our common stock
could be delisted from NASDAQ, which could hinder our investors ability to trade our common stock
in the secondary market.
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The market price of our stock may be subject to wide fluctuations.
  
    
    price and volume fluctuations in the overall stock market from time to time;
    
    significant volatility in the market price and trading volume of companies in our industry;
    
    actual or anticipated changes in our earnings or
fluctuations in our operating results or in the expectations
of financial market analysts;
    
    investor perceptions of our industry, in general, and our company, in particular;
    
    the operating and stock performance of comparable companies;
    
    general economic conditions and trends;
    
    major catastrophic events;
    
    loss of external funding sources;
    
    sales of large blocks of our stock or sales by insiders; or
    
    departures of key personnel.
 Our articles of incorporation, bylaws and Minnesota law may discourage takeovers and business
combinations that our shareholders might consider to be in their best interests.
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We do not anticipate paying cash dividends on our shares of common stock in the foreseeable
future.
  A substantial number of shares are eligible for future sale by our current investors and the
sale of those shares could adversely affect our stock price.
  
 ITEM 1B UNRESOLVED STAFF COMMENTS
  
 ITEM 2 PROPERTIES
   
 ITEM 3 LEGAL PROCEEDINGS
  
 ITEM 4 (REMOVED AND RESERVED)
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PART II
 
 ITEM 5    MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF
EQUITY SECURITIES
 Market Information
  High
    
    
    Low2010First Quarter
    
    $
    3.83
    
    
    $
    1.93Second Quarter
    
    $
    2.64
    
    
    $
    1.08Third Quarter
    
    $
    1.91
    
    
    $
    1.10Fourth Quarter
    
    $
    1.53
    
    
    $
    1.112009First Quarter
    
    $
    2.32
    
    
    $
    0.80Second Quarter
    
    $
    3.03
    
    
    $
    1.60Third Quarter
    
    $
    4.07
    
    
    $
    2.19Fourth Quarter
    
    $
    3.99
    
    
    $
    2.62
 Shareholders
  Dividend Policy
  Securities Authorized for Issuance Under Equity Compensation Plans
  Stock Performance Graph
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COMPARISON OF CUMULATIVE TOTAL RETURN
 
 Sales of Unregistered Securities During the Fourth Quarter of Fiscal Year 2010
  
 ITEM 6 SELECTED FINANCIAL DATA
  28




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December 31,2010
    
    
    2009
    
    
    2008
    
    
    2007
    
    
    2006Balance Sheet Data:Current assets
    
    $
    10,133
    
    
    $
    13,705
    
    
    $
    16,157
    
    
    $
    34,923
    
    
    $
    16,700Total assets
    
    
    11,242
    
    
    
    15,347
    
    
    
    18,560
    
    
    
    40,369
    
    
    
    17,546Current liabilities
    
    
    2,659
    
    
    
    1,589
    
    
    
    2,387
    
    
    
    4,610
    
    
    
    1,653Non-current liabilities
    
    
    40
    
    
    
    
    
    
    
    
    
    
    
    71
    
    
    
    155Total liabilities
    
    
    2,699
    
    
    
    1,589
    
    
    
    2,387
    
    
    
    4,681
    
    
    
    1,808Shareholders equity
    
    $
    8,543
    
    
    $
    13,758
    
    
    $
    16,173
    
    
    $
    35,688
    
    
    $
    15,738
 For the Years Ended December 31,2010
    
    
    2009
    
    
    2008
    
    
    2007
    
    
    2006Statement of Operations Data:Sales
    
    $
    8,567
    
    
    $
    5,009
    
    
    $
    7,381
    
    
    $
    5,985
    
    
    $
    3,145Cost of sales
    
    
    4,582
    
    
    
    3,586
    
    
    
    6,589
    
    
    
    3,892
    
    
    
    1,545Gross profit
    
    
    3,985
    
    
    
    1,423
    
    
    
    792
    
    
    
    2,093
    
    
    
    1,600Selling, general and administrative and other
    
    
    8,976
    
    
    
    9,509
    
    
    
    19,564
    
    
    
    12,210
    
    
    
    5,043Research and development expenses
    
    
    2,864
    
    
    
    2,167
    
    
    
    2,541
    
    
    
    1,198
    
    
    
    876Total operating expenses
    
    
    11,840
    
    
    
    11,676
    
    
    
    22,105
    
    
    
    13,408
    
    
    
    5,919Operating loss
    
    
    (7,855
    )
    
    
    (10,253
    )
    
    
    (21,313
    )
    
    
    (11,315
    )
    
    
    (4,319
    )Other income (expense)
    
    
    (28
    )
    
    
    70
    
    
    
    621
    
    
    
    1,229
    
    
    
    (10,469
    )Net loss
    
    $
    (7,883
    )
    
    $
    (10,183
    )
    
    $
    (20,692
    )
    
    $
    (10,086
    )
    
    $
    (14,788
    )Basic and diluted loss per common share
    
    $
    (0.44
    )
    
    $
    (0.67
    )
    
    $
    (1.41
    )
    
    $
    (0.82
    )
    
    $
    (9.71
    )Basic and diluted weighted average shares
outstanding
    
    
    17,901
    
    
    
    15,274
    
    
    
    14,664
    
    
    
    12,314
    
    
    
    1,523
 
 ITEM 7 MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
 Forward-Looking Statements
 The following discussion contains various forward-looking statements within the meaning of
Section 21E of the Exchange Act. Although we believe that, in making any such statement, our
expectations are based on reasonable assumptions, any such statement may be influenced by
factors that could cause actual outcomes and results to be materially different from those
projected. When used in the following discussion, the words anticipates, believes,
expects, intends, plans, estimates and similar expressions, as they relate to us or our
management, are intended to identify such forward-looking statements. These forward-looking
statements are subject to numerous risks and uncertainties that could cause actual results to
differ materially from those anticipated. Factors that could cause actual results to differ
materially from those anticipated, certain of which are beyond our control, are set forth in
Item 1A under the caption Risk Factors.
 Our actual results, performance or achievements could differ materially from those
expressed in, or implied by, forward-looking statements. Accordingly, we cannot be certain that
any of the events anticipated by forward-looking statements will occur or, if any of them do
occur, what impact they will have on us. We caution you to keep in mind the cautions and risks
described in this document and to refrain from attributing undue certainty to any
forward-looking statements, which speak only as of the date of the document in which they
appear. We do not undertake to update any forward-looking statement.
 29




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##### Table of Contents



Overview
 ®
      Our Sources of Revenue
  30




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##### Table of Contents



Our Expenses
 ®
 Critical Accounting Policies and Estimates
  Revenue Recognition
  
    
    Software and software license sales
    
    System hardware sales
    
    Professional service revenue
    
    Software design and development services
    
    Implementation services
    
    Maintenance and hosting support contracts
 Revenue
Recognition: Software ( ASC 605-35)
   31




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##### Table of Contents



Software and software license sales
  System hardware sales
  Professional service revenue
  Software design and development services
   32




---



##### Table of Contents



Implementation services
  Maintenance and hosting support contracts
   Basic and Diluted Loss per Common Share
  Deferred Income Taxes
  Accounting for Stock-Based Compensation
  33




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##### Table of Contents



Accounting for Equity Instruments that are Issued to Other Than Employees for
Acquiring, or in Conjunction with Selling, Goods or Services Accounting
Recognition for Certain Transactions Involving Equity Instruments Granted to Other Than Employees
  Results of Operations
  For the Years Ended December 31,(in thousands)2010
    
    
    2009
    
    
    2008Sales
    
    $
    8,567
    
    
    $
    5,009
    
    
    $
    7,381Cost of sales (exclusive of depreciation and
amortization shown separately below)
    
    
    4,582
    
    
    
    3,586
    
    
    
    6,589Gross profit
    
    
    3,985
    
    
    
    1,423
    
    
    
    792Sales and marketing expenses
    
    
    2,329
    
    
    
    2,520
    
    
    
    3,999Research and development expenses
    
    
    2,864
    
    
    
    2,167
    
    
    
    2,541General and administrative expenses
    
    
    5,963
    
    
    
    6,168
    
    
    
    11,258Depreciation and amortization expense
    
    
    684
    
    
    
    771
    
    
    
    1,226Impairment of network equipment held for sale
    
    
    
    
    
    
    
    
    
    
    1,766Impairment of intangible assets
    
    
    
    
    
    
    
    
    
    
    1,265Termination of partnership agreement
    
    
    
    
    
    
    50
    
    
    
    50Total operating expenses
    
    
    11,840
    
    
    
    11,676
    
    
    
    22,105Operating loss
    
    
    (7,855
    )
    
    
    (10,253
    )
    
    
    (21,313
    )Other income (expenses):Interest expense
    
    
    (58
    )
    
    
    (6
    )
    
    
    (22
    )Interest income
    
    
    30
    
    
    
    76
    
    
    
    647Other
    
    
    
    
    
    
    
    
    
    
    (4
    )Total other income
    
    
    (28
    )
    
    
    70
    
    
    
    621Net loss
    
    $
    (7,883
    )
    
    $
    (10,183
    )
    
    $
    (20,692
    )
 34




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##### Table of Contents



For the Years Ended December 31,2010
    
    
    2009
    
    
    2008Sales
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %Cost of sales (exclusive of depreciation and
amortization shown separately below)
    
    
    53.5
    %
    
    
    71.6
    %
    
    
    89.3
    %Gross profit
    
    
    46.5
    %
    
    
    28.4
    %
    
    
    10.7
    %Sales and marketing expenses
    
    
    27.2
    %
    
    
    50.3
    %
    
    
    54.2
    %Research and development expenses
    
    
    33.4
    %
    
    
    43.3
    %
    
    
    34.4
    %General and administrative expenses
    
    
    69.6
    %
    
    
    123.1
    %
    
    
    152.5
    %Depreciation and amortization expense
    
    
    8.0
    %
    
    
    15.4
    %
    
    
    16.6
    %Impairment of network equipment held for sale
    
    
    
    
    
    
    
    
    
    
    23.9
    %Impairment of intangible assets
    
    
    
    
    
    
    
    
    
    
    17.1
    %Termination of partnership agreement
    
    
    
    
    
    
    1.0
    %
    
    
    0.7
    %Total operating expenses
    
    
    138.2
    %
    
    
    233.1
    %
    
    
    299.4
    %Operating loss
    
    
    (91.7
    %)
    
    
    (204.7
    %)
    
    
    (288.7
    %)Other income (expenses):Interest expense
    
    
    (0.7
    %)
    
    
    (0.1
    %)
    
    
    (0.3
    %)Interest income
    
    
    0.4
    %
    
    
    1.5
    %
    
    
    8.8
    %Other
    
    
    
    
    
    
    
    
    
    
    (0.1
    %)Total other income
    
    
    (0.3
    %)
    
    
    1.4
    %
    
    
    8.4
    %Net loss
    
    
    (92.0
    %)
    
    
    (203.3
    %)
    
    
    (280.3
    %)
 2010 compared to 2009
 Sales
   QSR
 35




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##### Table of Contents



Cost of Sales
 ®
 Operating Expenses
 Sales and marketing
 Research and development ®
 36




---



##### Table of Contents



®
 General and administrative
 Depreciation and amortization expense.
 Interest Expense
  2009 compared to 2008
 Sales
 ®
 Cost of Sales
  37




---



##### Table of Contents



Operating Expenses
 Sales and marketing
 Research and development
 General and administrative
   Depreciation and amortization
 Impairment of Network Equipment Held for Sale.
 38




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##### Table of Contents



Impairment of Intangible Assets.
 Termination of Partnership Agreement.
 Interest Expense
  Liquidity and Capital Resources
    39




---



##### Table of Contents



Operating Activities
   Investing Activities
  Financing Activities
   40




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41




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##### Table of Contents



Off Balance Sheet Arrangements
  Contractual Obligations
  Operating and Capital Leases
  Payment Due by PeriodLess Than
    
    
    
    
    
    
    
    
    
    
    More ThanContractual Obligations
    
    Total
    
    
    1 Year
    
    
    1-3 Years
    
    
    3-5 Years
    
    
    5 YearsOperating Lease Obligations
    
    $
    1,548
    
    
    $
    242
    
    
    $
    488
    
    
    $
    414
    
    
    $
    404Capital Lease Obligations
    
    
    90
    
    
    
    46
    
    
    
    44
    
    
    
    
    
    
    
    Total
    
    $
    1,638
    
    
    $
    288
    
    
    $
    532
    
    
    $
    414
    
    
    $
    404
   Recent Accounting Pronouncements
 Accounting for Transfers of Financial
Assets
 Consolidation of Variable Interest
Entities
 42




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Subsequent Events
   
 ITEM 7A QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
    
 ITEM 8 FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
  43




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ITEM 9 CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
  
 ITEM 9A CONTROLS AND PROCEDURES
 Evaluation of Disclosure Controls and Procedures
   Managements Annual Report On Internal Control Over Financial Reporting
  
    
    Pertain to the maintenance of records that in reasonable detail accurately and fairly
reflect the transactions and dispositions of our assets;
    
    Provide reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted accounting
principles, and that our receipts and expenditures are being made only in accordance with
authorizations of our management and directors; and
    
    Provide reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use or disposition of our assets that could have a material effect on the
financial statements.
    44




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##### Table of Contents



Changes in Internal Control Over Financial Reporting
  
 ITEM 9B OTHER INFORMATION
  
 PART III
 
 ITEM 10 DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
    
 ITEM 11 EXECUTIVE COMPENSATION
  
 ITEM
12   SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER
MATTERS
  
 ITEM 13 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
  45




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##### Table of Contents



ITEM 14 PRINCIPAL ACCOUNTANT FEES AND SERVICES
  
 PART IV
 
 ITEM 15 EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
    46




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SIGNATURES
  Wireless Ronin Technologies, Inc.By
    /s/  Scott W. KollerScott W. KollerPresident and Chief Executive Officer
(Principal Executive Officer)  Signature
    
    Title
    
    Date/s/ Scott W. Koller

Scott W. Koller
    
    President and Chief Executive Officer
(Principal Executive Officer)
    
    March 22, 2011/s/ Darin P. McAreavey

Darin P. McAreavey
    
    Senior Vice President and Chief Financial
Officer (Principal Financial Officer and
Principal Accounting Officer)
    
    March 22, 2011/s/ Stephen F. Birke

Stephen F. Birke
    
    Chairman of the Board of Directors
    
    March 22, 2011/s/ Gregory T. Barnum

Gregory T. Barnum
    
    Director
    
    March 22, 2011/s/ Thomas J. Moudry

Thomas J. Moudry
    
    Director
    
    March 22, 2011/s/ Geoffrey J. Obeney

Geoffrey J. Obeney
    
    Director
    
    March 22, 2011/s/ William F. Schnell

William F. Schnell
    
    Director
    
    March 22, 2011/s/ Brett A. Shockley

Brett A. Shockley
    
    Director
    
    March 22, 2011
 47




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##### Table of Contents



INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
 Wireless Ronin Technologies, Inc.
 Report of Independent Registered Public Accounting Firm
    
    
    F-2Consolidated Financial StatementsConsolidated Balance Sheets
    
    
    F-3Consolidated Statements of Operations
    
    
    F-4Consolidated Statements of Shareholders Equity
    
    
    F-5Consolidated Statements of Cash Flows
    
    
    F-6Notes to Consolidated Financial Statements
    
    
    F-7
 F-1




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F-2




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except per share amounts)
 December 31,
    
    
    December 31,2010
    
    
    2009ASSETSCURRENT ASSETSCash and cash
equivalents
    
    $
    7,064
    
    
    $
    12,273Accounts receivable, net of allowance of
$35 and  $51
    
    
    2,522
    
    
    
    1,096Inventories
    
    
    272
    
    
    
    185Prepaid expenses and
other current assets
    
    
    275
    
    
    
    151Total current assets
    
    
    10,133
    
    
    
    13,705Property and equipment, net
    
    
    1,019
    
    
    
    1,242Restricted cash
    
    
    50
    
    
    
    380Other assets
    
    
    40
    
    
    
    20TOTAL ASSETS
    
    $
    11,242
    
    
    $
    15,347LIABILITIES AND SHAREHOLDERS EQUITYCURRENT LIABILITIESCurrent maturities of capital lease
obligations
    
    $
    37
    
    
    $
    Accounts payable
    
    
    1,563
    
    
    
    976Deferred revenue
    
    
    488
    
    
    
    362Accrued liabilities
    
    
    571
    
    
    
    251Total current
liabilities
    
    
    2,659
    
    
    
    1,589Capital lease obligations,
less current maturities
    
    
    40
    
    
    
    TOTAL LIABILITIES
    
    
    2,699
    
    
    
    1,589COMMITMENTS AND
CONTINGENCIESSHAREHOLDERS EQUITYCapital stock, $0.01 par value, 66,667 shares authorized
Preferred stock, 16,667 shares authorized, no shares
issued
and outstanding
    
    
    
    
    
    
    Common stock, 50,000 shares authorized; 19,233 and
17,614 shares
issued and
outstanding
    
    
    192
    
    
    
    176Additional paid-in
capital
    
    
    91,138
    
    
    
    88,371Accumulated deficit
    
    
    (82,278
    )
    
    
    (74,395
    )Accumulated other
comprehensive loss
    
    
    (509
    )
    
    
    (394
    )Total shareholders
equity
    
    
    8,543
    
    
    
    13,758TOTAL LIABILITIES AND SHAREHOLDERS EQUITY
    
    $
    11,242
    
    
    $
    15,347
 See accompanying Notes to Consolidated Financial Statements.
 F-3




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WIRELESS RONIN TECHNOLOGIES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
 For the Years Ended December 31,2010
    
    
    2009
    
    
    2008SalesHardware
    
    $
    3,195
    
    
    $
    1,878
    
    
    $
    2,479Software
    
    
    1,394
    
    
    
    710
    
    
    
    876Services and other
    
    
    3,978
    
    
    
    2,421
    
    
    
    4,026Total sales
    
    
    8,567
    
    
    
    5,009
    
    
    
    7,381Cost of salesHardware
    
    
    2,113
    
    
    
    1,504
    
    
    
    2,193Software
    
    
    109
    
    
    
    21
    
    
    
    247Services and other
    
    
    2,312
    
    
    
    2,018
    
    
    
    4,084Inventory lower of cost or market adjustment
    
    
    48
    
    
    
    43
    
    
    
    65Total cost of sales (exclusive of depreciation and
amortization shown separately below)
    
    
    4,582
    
    
    
    3,586
    
    
    
    6,589Gross profit
    
    
    3,985
    
    
    
    1,423
    
    
    
    792Operating expenses:Sales and marketing expenses
    
    
    2,329
    
    
    
    2,520
    
    
    
    3,999Research and development expenses
    
    
    2,864
    
    
    
    2,167
    
    
    
    2,541General and administrative expenses
    
    
    5,963
    
    
    
    6,168
    
    
    
    11,258Depreciation and amortization expense
    
    
    684
    
    
    
    771
    
    
    
    1,226Impairment of network equipment held for sale
    
    
    
    
    
    
    
    
    
    
    1,766Impairment of intangible assets
    
    
    
    
    
    
    
    
    
    
    1,265Termination of partnership agreement
    
    
    
    
    
    
    50
    
    
    
    50Total operating expenses
    
    
    11,840
    
    
    
    11,676
    
    
    
    22,105Operating loss
    
    
    (7,855
    )
    
    
    (10,253
    )
    
    
    (21,313
    )Other income (expenses):Interest expense
    
    
    (58
    )
    
    
    (6
    )
    
    
    (22
    )Interest income
    
    
    30
    
    
    
    76
    
    
    
    647Other
    
    
    
    
    
    
    
    
    
    
    (4
    )Total other income (expense)
    
    
    (28
    )
    
    
    70
    
    
    
    621Net loss
    
    $
    (7,883
    )
    
    $
    (10,183
    )
    
    $
    (20,692
    )Basic and diluted loss per common share
    
    $
    (0.44
    )
    
    $
    (0.67
    )
    
    $
    (1.41
    )Basic and diluted weighted average shares outstanding
    
    
    17,901
    
    
    
    15,274
    
    
    
    14,664
 See accompanying Notes to Consolidated Financial Statements.
 F-4




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.
CONSOLIDATED STATEMENTS OF SHAREHOLDERS EQUITY
(in thousands, except per share amounts)
 AccumulatedAdditional
    
    
    
    
    
    
    Other
    
    
    TotalCommon Stock
    
    
    Paid-In
    
    
    Accumulated
    
    
    Comprehensive
    
    
    ShareholdersShares
    
    
    Amount
    
    
    Capital
    
    
    Deficit
    
    
    Income (loss)
    
    
    EquityBalances at December 31, 2007
    
    
    14,538
    
    
    $
    145
    
    
    $
    78,742
    
    
    $
    (43,520
    )
    
    $
    321
    
    
    $
    35,688Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (20,692
    )
    
    
    
    
    
    
    (20,692
    )Unrealized loss on investments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1
    )
    
    
    (1
    )Foreign currency translation loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (733
    )
    
    
    (733
    )Total comprehensive loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (21,426
    )Stock-based compensation
    
    
    
    
    
    
    
    
    
    
    1,313
    
    
    
    
    
    
    
    
    
    
    
    1,313Restricted stock issued under equity incentive plan
    
    
    6
    
    
    
    1
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1Exercise of options and warrants
    
    
    163
    
    
    
    1
    
    
    
    371
    
    
    
    
    
    
    
    
    
    
    
    372Common stock issued under associate stock purchase plan
    
    
    143
    
    
    
    1
    
    
    
    224
    
    
    
    
    
    
    
    
    
    
    
    225Balances at December 31, 2008
    
    
    14,850
    
    
    
    148
    
    
    
    80,650
    
    
    
    (64,212
    )
    
    
    (413
    )
    
    
    16,173Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (10,183
    )
    
    
    
    
    
    
    (10,183
    )Foreign currency translation gain
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    19
    
    
    
    19Total comprehensive loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (10,164
    )Stock-based compensation
    
    
    
    
    
    
    
    
    
    
    698
    
    
    
    
    
    
    
    
    
    
    
    698Restricted and common stock issued under equity incentive plan
    
    
    30
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Exercise of options and warrants
    
    
    36
    
    
    
    1
    
    
    
    60
    
    
    
    
    
    
    
    
    
    
    
    61Common stock issued under associate stock purchase plan
    
    
    83
    
    
    
    1
    
    
    
    86
    
    
    
    
    
    
    
    
    
    
    
    87Proceeds from the sale of common stock, less offering costs
    
    
    2,615
    
    
    
    26
    
    
    
    6,877
    
    
    
    
    
    
    
    
    
    
    
    6,903Balances at December 31, 2009
    
    
    17,614
    
    
    
    176
    
    
    
    88,371
    
    
    
    (74,395
    )
    
    
    (394
    )
    
    
    13,758Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (7,883
    )
    
    
    
    
    
    
    (7,883
    )Foreign currency translation loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (115
    )
    
    
    (115
    )Total comprehensive loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (7,998
    )Stock-based compensation
    
    
    
    
    
    
    
    
    
    
    868
    
    
    
    
    
    
    
    
    
    
    
    868Warrants issued for debt issuance costs
    
    
    
    
    
    
    
    
    
    
    66
    
    
    
    
    
    
    
    
    
    
    
    66Restricted and common stock issued under equity incentive plan
    
    
    91
    
    
    
    1
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1Forfeiture of restricted stock awards
    
    
    (11
    )
    
    
    
    
    
    
    (25
    )
    
    
    
    
    
    
    
    
    
    
    (25
    )Exercise of options and warrants
    
    
    86
    
    
    
    1
    
    
    
    233
    
    
    
    
    
    
    
    
    
    
    
    234Common stock issued under associate stock purchase plan
    
    
    28
    
    
    
    
    
    
    
    30
    
    
    
    
    
    
    
    
    
    
    
    30Proceeds from the sale of common stock, less offering costs
    
    
    1,425
    
    
    
    14
    
    
    
    1,595
    
    
    
    
    
    
    
    
    
    
    
    1,609Balances at December 31, 2010
    
    
    19,233
    
    
    $
    192
    
    
    $
    91,138
    
    
    $
    (82,278
    )
    
    $
    (509
    )
    
    $
    8,543
 See accompanying Notes to Consolidated Financial Statements.
 F-5




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands, except per share amounts)
 For the Years Ended December 31,2010
    
    
    2009
    
    
    2008Operating Activities:Net loss
    
    $
    (7,883
    )
    
    $
    (10,183
    )
    
    $
    (20,692
    )Adjustments to reconcile net loss to net cash used in operating activitiesDepreciation and amortization
    
    
    684
    
    
    
    771
    
    
    
    702Amortization of acquisition-related intangibles
    
    
    
    
    
    
    
    
    
    
    524Impairment of intangible assets
    
    
    
    
    
    
    
    
    
    
    1,265Impairment of network equipment held for sale
    
    
    
    
    
    
    
    
    
    
    1,766Loss on disposal of property and equipment
    
    
    13
    
    
    
    53
    
    
    
    73Stock-based compensation expense
    
    
    868
    
    
    
    698
    
    
    
    1,313Amortization of warrants issued for debt issuance costs
    
    
    50
    
    
    
    
    
    
    
    Forfeiture of common stock for payroll taxes
    
    
    (25
    )
    
    
    
    
    
    
    Change in operating assets and liabilities, net of acquisitions:Provision for doubtful receivables
    
    
    9
    
    
    
    (41
    )
    
    
    7Accounts receivable
    
    
    (1,435
    )
    
    
    828
    
    
    
    (173
    )Corporate income taxes
    
    
    
    
    
    
    14
    
    
    
    189Inventories
    
    
    (87
    )
    
    
    275
    
    
    
    182Prepaid expenses and other current assets
    
    
    (112
    )
    
    
    72
    
    
    
    (63
    )Other assets
    
    
    (20
    )
    
    
    18
    
    
    
    1Accounts payable
    
    
    584
    
    
    
    (107
    )
    
    
    (272
    )Deferred revenue
    
    
    127
    
    
    
    180
    
    
    
    (6
    )Accrued liabilities
    
    
    128
    
    
    
    (825
    )
    
    
    274Net cash used in operating activities
    
    
    (7,099
    )
    
    
    (8,247
    )
    
    
    (14,910
    )Investing activitiesPurchases of property and equipment
    
    
    (189
    )
    
    
    (133
    )
    
    
    (1,051
    )Purchases of marketable securities
    
    
    
    
    
    
    (22
    )
    
    
    (28,662
    )Sales of marketable securities
    
    
    
    
    
    
    8,323
    
    
    
    35,018Net cash provided by/(used in) investing activities
    
    
    (189
    )
    
    
    8,168
    
    
    
    5,305Financing activitiesPayments on long-term notes payable and capital leases
    
    
    (11
    )
    
    
    (71
    )
    
    
    (99
    )Restricted cash
    
    
    330
    
    
    
    70
    
    
    
    Proceeds from issuance of common stock and warrants
    
    
    1,609
    
    
    
    6,903
    
    
    
    Proceeds from exercise of warrants and stock options
    
    
    234
    
    
    
    61
    
    
    
    372Proceeds from sale of common stock under associate stock purchase plan
    
    
    30
    
    
    
    87
    
    
    
    225Net cash provided by financing activites
    
    
    2,192
    
    
    
    7,050
    
    
    
    498Effect of Exchange Rate Changes on Cash
    
    
    (113
    )
    
    
    8
    
    
    
    (141
    )Increase (Decrease) in Cash and Cash Equivalents
    
    
    (5,209
    )
    
    
    6,979
    
    
    
    (9,248
    )Cash and Cash Equivalents, beginning of year
    
    
    12,273
    
    
    
    5,294
    
    
    
    14,542Cash and Cash Equivalents, end of year
    
    $
    7,064
    
    
    $
    12,273
    
    
    $
    5,294
 See accompanying Notes to Consolidated Financial Statements.
 F-6




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 (in thousands, except per share amounts)
 NOTE 1: NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 Nature of Business and Operations
 Overview
 ®
   Summary of Significant Accounting Policies
  1. Principles of Consolidation
  2. Foreign Currency
  F-7




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(in thousands, except per share amounts)
 3. Revenue Recognition
  
    
    Software and software license sales
 
    
    System hardware sales
 
    
    Professional service revenue
 
    
    Software design and development services
 
    
    Implementation services
 
    
    Maintenance and hosting support contracts
 Revenue Recognition: Software ( ASC 605-35)
     F-8




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(in thousands, except per share amounts)
 Software and software license sales
  System hardware sales
  Professional service revenue
  Software design and development services
  F-9




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(in thousands, except per share amounts)
    December 31,2010
    
    
    2009Cost incurred on uncompleted contracts
    
    $
    80
    
    
    $
    205Estimated earnings
    
    
    179
    
    
    
    226Revenue recognized
    
    
    259
    
    
    
    431Less: billings to date
    
    
    (182
    )
    
    
    (532
    )$
    77
    
    
    $
    (101
    )
  December 31,2010
    
    
    2009Costs and estimated earnings in excess of billings on uncompleted contracts
    
    $
    109
    
    
    $
    74Billings in excess of costs and estimated earnings on uncompleted contracts
    
    
    (32
    )
    
    
    (175
    )$
    77
    
    
    $
    (101
    )
 Implementation services
  Maintenance and hosting support contracts
   F-10




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(in thousands, except per share amounts)
 4. Cash and Cash Equivalents
  5. Restricted Cash
  6. Accounts Receivable
  7. Inventories
  8. Impairment of Long-Lived Assets
 Accounting for the Impairment or Disposal of Long-Lived Assets
  F-11




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(in thousands, except per share amounts)
 9. Depreciation and Amortization
   Equipment
    
    3   5 yearsDemonstration equipment
    
    3  5 yearsFurniture and fixtures
    
    7 yearsPurchased software
    
    3 yearsLeased equipment
    
    3 yearsLeasehold improvements
    
    Shorter of 5 years or term of lease
  10. Advertising Costs
  11. Comprehensive Loss
  12. Research and Development and Software Development Costs
 Accounting for the
Costs of Computer Software to Be Sold, Leased, or Otherwise Marketed,
 F-12




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(in thousands, except per share amounts)
 13. Basic and Diluted Loss per Common Share
  14. Deferred Income Taxes
  15. Accounting for Stock-Based Compensation
    F-13




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(in thousands, except per share amounts)
 Accounting for Equity Instruments that are Issued to Other Than Employees
for Acquiring, or in Conjunction with Selling, Goods or Services Accounting Recognition for Certain Transactions Involving Equity Instruments Granted to Other Than
Employees
  16. Fair Value of Financial Instruments
 Fair Value Measurements and Disclosures,
 17. Use of Estimates
  18. Deferred Financing Costs
  19. Subsequent Events
  F-14




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(in thousands, except per share amounts)
 Recent Accounting Pronouncements
 Accounting for Transfers of Financial
Assets
 Consolidation of Variable Interest
Entities
  NOTE 2: OTHER FINANCIAL STATEMENT INFORMATION
  ALLOWANCE FOR DOUBTFUL RECEIVABLES
 2010
    
    
    2009Balance at beginning of year
    
    $
    51
    
    
    $
    92Provision for doubtful receivables
    
    
    
    
    
    
    Write-offs
    
    
    (16
    )
    
    
    (41
    )Balance at end of year
    
    $
    35
    
    
    $
    51
 INVENTORIES
 December 31,2010
    
    
    2009Finished goods
    
    $
    188
    
    
    $
    156Work-in-process
    
    
    84
    
    
    
    29Total inventories
    
    $
    272
    
    
    $
    185
 F-15




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(in thousands, except per share amounts)
  PREPAID EXPENSES AND OTHER CURRENT ASSETS
  PROPERTY AND EQUIPMENT
 December 31,2010
    
    
    2009Leased equipment
    
    $
    411
    
    
    $
    321Equipment
    
    
    1,433
    
    
    
    1,330Leasehold improvements
    
    
    363
    
    
    
    155Demonstration equipment
    
    
    155
    
    
    
    151Purchased software
    
    
    691
    
    
    
    651Furniture and fixtures
    
    
    571
    
    
    
    565Total property and equipment
    
    $
    3,624
    
    
    $
    3,173Less: accumulated depreciation and amortization
    
    
    (2,605
    )
    
    
    (1,931
    )Net property and equipment
    
    $
    1,019
    
    
    $
    1,242
 OTHER ASSETS
  ACCRUED LIABILITIES
 December 31,2010
    
    
    2009Compensation
    
    $
    260
    
    
    $
    146Accrued rent
    
    
    252
    
    
    
    71Sales tax and other
    
    
    59
    
    
    
    34Total accrued liabilities
    
    $
    571
    
    
    $
    251
  F-16




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(in thousands, except per share amounts)
 DEFERRED REVENUE
 December 31,2010
    
    
    2009Deferred software maintenance
    
    $
    293
    
    
    $
    75Customer deposits and deferred project revenue
    
    
    195
    
    
    
    287Total deferred revenue
    
    $
    488
    
    
    $
    362
 SUPPLEMENTAL CASH FLOW INFORMATION
 For the Yeas Ended December 31,2010
    
    
    2009
    
    
    2008Supplemental disclosures of cash flow informationCash paid for:Interest
    
    $
    3
    
    
    $
    6
    
    
    $
    22Supplemental disclosures of non-cash investing and financing activitiesWarrants issued for debt issuance costs
    
    
    66
    
    
    
    Non-cash purchase of property and equipment through capital lease obligations
    
    
    89
    
    
    
    Non-cash purchase of property and equipment through leasehold improvement allowance
    
    
    191
    
    
    
    
    
    
    
    Collateral received for note receivable
    
    
    
    
    
    
    
    
    
    
    1,937
 NOTE 3: TERMINATION OF PARTNERSHIP AGREEMENT
  NOTE 4: FAIR VALUE MEASUREMENTS
   F-17




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(in thousands, except per share amounts)
  December 31, 2010Gross
    
    
    Gross
    
    
    Gross
    
    
    EstimatedAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    FairCost
    
    
    Gains
    
    
    (Losses)
    
    
    ValueCommercial paper
    
    $
    6,764
    
    
    $
    
    
    
    $
    
    
    
    $
    6,764Total included in cash and cash equivalents
    
    $
    6,764
    
    
    $
    
    
    
    $
    
    
    
    $
    6,764
 December 31, 2009Gross
    
    
    Gross
    
    
    Gross
    
    
    EstimatedAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    FairCost
    
    
    Gains
    
    
    (Losses)
    
    
    ValueCommercial paper
    
    $
    10,210
    
    
    $
    
    
    
    $
    
    
    
    $
    10,210Total included in cash and cash equivalents
    
    $
    10,210
    
    
    $
    
    
    
    $
    
    
    
    $
    10,210
      F-18




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(in thousands, except per share amounts)
 NOTE 5: CAPITAL LEASE OBLIGATIONS
   December 31,2010
    
    
    2009Cost
    
    $
    89
    
    
    $
    322Less: accumulated amortization
    
    
    (14
    )
    
    
    (322
    )Total
    
    $
    75
    
    
    $
    
   For the Years Ending December 31,
    
    Amount2011
    
    $
    462012
    
    
    44Total payments
    
    
    90Less: portion representing interest
    
    
    (13
    )Principal portion
    
    
    77Less: current portion
    
    
    (37
    )Long-term portion
    
    $
    40
  Years Ending December 31,
    
    Amount2011
    
    
    372012
    
    
    40Total
    
    $
    77
 F-19




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(in thousands, except per share amounts)
 NOTE 6: COMMITMENTS AND CONTINGENCIES
 Operating Leases
    Year Ending December 31,
    
    Lease Obligations2011
    
    $
    2422012
    
    
    2452013
    
    
    2432014
    
    
    2192015
    
    
    195Thereafter
    
    
    404Total future minimum obligations
    
    $
    1,548
 Litigation
  F-20




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(in thousands, except per share amounts)
 Revolving Line-of-Credit
  NOTE 7: SHAREHOLDERS EQUITY
 Registered Direct Offerings
   F-21




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(in thousands, except per share amounts)
 Warrants
   2010
    
    
    2009
    
    
    2008Weighted
    
    
    
    
    
    
    Weighted
    
    
    
    
    
    
    WeightedCommon
    
    
    Average
    
    
    Common
    
    
    Average
    
    
    Common
    
    
    AverageStock
    
    
    Exercise
    
    
    Stock
    
    
    Exercise
    
    
    Stock
    
    
    ExerciseWarrants
    
    
    Price
    
    
    Warrants
    
    
    Price
    
    
    Warrants
    
    
    PriceOutstanding at beginning of year
    
    
    1,357
    
    
    $
    4.55
    
    
    
    1,637
    
    
    $
    5.20
    
    
    
    1,866
    
    
    $
    5.28Granted
    
    
    326
    
    
    
    1.62
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Exercised
    
    
    (63
    )
    
    
    3.20
    
    
    
    
    
    
    
    
    
    
    
    (130
    )
    
    
    3.29Expired
    
    
    (170
    )
    
    
    8.34
    
    
    
    (280
    )
    
    
    8.39
    
    
    
    (99
    )
    
    
    9.04Outstanding at end of year
    
    
    1,450
    
    
    $
    3.50
    
    
    
    1,357
    
    
    $
    4.55
    
    
    
    1,637
    
    
    $
    5.20Non-exercisable
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Outstanding and exercisable at end of year
    
    
    1,450
    
    
    $
    3.50
    
    
    
    1,357
    
    
    $
    4.55
    
    
    
    1,637
    
    
    $
    5.20
     NOTE 8: STOCK-BASED COMPENSATION AND BENEFIT PLANS
 Warrants
  F-22




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(in thousands, except per share amounts)
  2010
    
    
    2009
    
    
    2008Weighted
    
    
    
    
    
    
    Weighted
    
    
    
    
    
    
    WeightedCommon
    
    
    Average
    
    
    Common
    
    
    Average
    
    
    Common
    
    
    AverageStock
    
    
    Exercise
    
    
    Stock
    
    
    Exercise
    
    
    Stock
    
    
    ExerciseWarrants
    
    
    Price
    
    
    Warrants
    
    
    Price
    
    
    Warrants
    
    
    PriceOutstanding at beginning of year
    
    
    229
    
    
    $
    8.09
    
    
    
    322
    
    
    $
    7.00
    
    
    
    363
    
    
    $
    6.21Granted
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Exercised
    
    
    (7
    )
    
    
    2.25
    
    
    
    (15
    )
    
    
    2.25
    
    
    
    (41
    )
    
    
    0.09Expired
    
    
    (122
    )
    
    
    7.66
    
    
    
    (78
    )
    
    
    4.71
    
    
    
    
    
    
    
    Outstanding and exercisable at end of year
    
    
    100
    
    
    $
    9.00
    
    
    
    229
    
    
    $
    8.09
    
    
    
    322
    
    
    $
    7.00
   Stock options
 Amended and Restated 2006 Equity Incentive Plan
  F-23




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(in thousands, except per share amounts)
  2006 Non-Employee Director Stock Option Plan
    WeightedAverageOptions
    
    
    ExerciseOutstanding
    
    
    PriceBalance, December 31, 2007
    
    
    1,314
    
    
    $
    4.65Granted
    
    
    993
    
    
    
    1.70Exercised
    
    
    
    
    
    
    Forfeited or expired
    
    
    (654
    )
    
    
    4.63Balance, December 31, 2008
    
    
    1,653
    
    
    $
    2.89Granted
    
    
    380
    
    
    
    1.66Exercised
    
    
    (21
    )
    
    
    1.26Forfeited or expired
    
    
    (402
    )
    
    
    3.90Balance, December 31, 2009
    
    
    1,610
    
    
    $
    2.36Granted
    
    
    889
    
    
    
    1.84Exercised
    
    
    (16
    )
    
    
    1.15Forfeited or expired
    
    
    (201
    )
    
    
    1.34Balance, December 31, 2010
    
    
    2,282
    
    
    $
    2.26
 F-24




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(in thousands, except per share amounts)
   Stock Options Outstanding
    
    
    Options ExercisableWeighted Average
    
    Weighted
    
    
    Aggregate
    
    
    
    
    
    
    Weighted
    
    
    AggregateRange of Exercise
    
    Number
    
    
    Remaining
    
    Average
    
    
    Intrinsic
    
    
    Options
    
    
    Average
    
    
    IntrinsicPrices Between
    
    Outstanding
    
    
    Contractual Life
    
    Exercise Price
    
    
    Value
    
    
    Exercisable
    
    
    Exercise Price
    
    
    Value$0.67  $1.12
    
    
    430
    
    
    8.1 Years
    
    $
    0.80
    
    
    $
    278
    
    
    
    350
    
    
    $
    0.73
    
    
    $
    250$1.13   $1.51
    
    
    460
    
    
    9.3 Years
    
    
    1.33
    
    
    
    56
    
    
    
    120
    
    
    
    1.37
    
    
    
    10$1.52   $2.33
    
    
    472
    
    
    4.8 Years
    
    
    1.82
    
    
    
    
    
    
    
    312
    
    
    
    1.77
    
    
    
    $2.34   $2.93
    
    
    478
    
    
    7.9 Years
    
    
    2.53
    
    
    
    
    
    
    
    51
    
    
    
    2.81
    
    
    
    $2.94   $7.38
    
    
    442
    
    
    0.9 Years
    
    
    4.83
    
    
    
    
    
    
    
    381
    
    
    
    4.74
    
    
    
    2,282
    
    
    6.2 Years
    
    $
    2.26
    
    
    $
    334
    
    
    
    1,214
    
    
    $
    2.41
    
    
    $
    260
 Restricted Stock and Share Awards
     F-25




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(in thousands, except per share amounts)
   Restricted
    
    
    WeightedStock Awards
    
    
    AverageOutstanding
    
    
    PriceBalance, December 31, 2007
    
    
    6
    
    
    $
    6.25Granted
    
    
    
    
    
    
    Vested
    
    
    (6
    )
    
    
    6.25Forfeited or expired
    
    
    
    
    
    
    Balance, December 31, 2008
    
    
    
    
    
    $
    Granted
    
    
    30
    
    
    
    2.20Vested
    
    
    (5
    )
    
    
    2.20Forfeited or expired
    
    
    
    
    
    
    Balance, December 31, 2009
    
    
    25
    
    
    $
    2.20Granted
    
    
    157
    
    
    
    2.00Vested
    
    
    (14
    )
    
    
    2.20Forfeited or expired
    
    
    (16
    )
    
    
    2.28Balance, December 31, 2010
    
    
    152
    
    
    $
    1.98
 Stock Compensation Expense Information
  2010
    
    
    2009
    
    
    2008Stock-based compensation costs included in:Cost of sales
    
    $
    9
    
    
    $
    6
    
    
    $
    20Sales and marketing expenses
    
    
    117
    
    
    
    331
    
    
    
    202Research and development expenses
    
    
    40
    
    
    
    42
    
    
    
    37General and administrative expenses
    
    
    702
    
    
    
    319
    
    
    
    1,054Total stock-based compensation expenses
    
    $
    868
    
    
    $
    698
    
    
    $
    1,313
 F-26




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(in thousands, except per share amounts)
  Valuation Information for Stock-Based Compensation
  2010
    
    
    2009
    
    
    2008Expected life
    
    
    4.04 to 4.30 Years
    
    
    3.25 Years
    
    3.31 YearsDividend yield
    
    
    0
    %
    
    
    0
    %
    
    
    0
    %Expected volatility
    
    
    91.7 to 94.3
    %
    
    
    98 to 105.6
    %
    
    
    98.5
    %Risk-free interest rate
    
    
    1.3 to 2.4
    %
    
    
    1.3 to 1.6
    %
    
    
    1.9
    %
     F-27




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(in thousands, except per share amounts)
 2007 Associate Stock Purchase Plan
  Employee Benefit Plan
  NOTE 9: SEGMENT INFORMATION AND MAJOR CUSTOMERS
   For the Years Ended December 31,2010
    
    
    2009
    
    
    2008United States
    
    $
    8,093
    
    
    $
    4,379
    
    
    $
    6,271Canada
    
    
    202
    
    
    
    127
    
    
    
    1,110Other countries
    
    
    272
    
    
    
    503
    
    
    
    Total Sales
    
    $
    8,567
    
    
    $
    5,009
    
    
    $
    7,381
  December 31,
    
    
    December 31,2010
    
    
    2009Property and equipment, net:United States
    
    $
    905
    
    
    $
    935Canada
    
    
    114
    
    
    
    307Total
    
    $
    1,019
    
    
    $
    1,242
 F-28




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(in thousands, except per share amounts)
  Years ended December 31,Customer
    
    2010
    
    
    2009
    
    
    2008Chrysler (BBDO Detroit/Windsor) **
    
    
    46.7
    %
    
    
    14.3
    %
    
    
    31.8
    %Aramark
    
    
    13.1
    %
    
    
    21.7
    %
    
    
    *Reuters Ltd.
    
    
    *
    
    
    
    15.8
    %
    
    
    *KFC
    
    
    *
    
    
    
    10.1
    %
    
    
    17.9
    %13.1
    %
    
    
    47.6
    %
    
    
    17.9
    %
 
 *
    
    Sales to these customers were less than 10% of total sales for the period reported.**
    
    Includes sales to BBDO Detroit/Windsor for 2009 and 2008.  Year ended December 31,Customer
    
    2010
    
    
    2009Chrysler
    
    
    48.3
    %
    
    
    41.8
    %
 NOTE 10: INCOME TAXES
   F-29




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(in thousands, except per share amounts)
  Year ended December 31,2010
    
    
    2009Current asset / (liability):Allowance for doubtful accounts
    
    $
    13
    
    
    $
    20Property and equipment
    
    
    (33
    )
    
    
    (192
    )Accrued expenses
    
    
    203
    
    
    
    29Severance
    
    
    
    
    
    
    9Non-qualified stock options
    
    
    475
    
    
    
    410Non-current asset:Net foreign carryforwards
    
    
    2,096
    
    
    
    2,077Net operating loss carryforwards
    
    
    21,603
    
    
    
    19,620Deferred tax asset
    
    
    24,357
    
    
    
    21,973Less: valuation allowance
    
    
    (24,357
    )
    
    
    (21,973
    )Net deferred tax asset
    
    $
    
    
    
    $
    
     F-30




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(in thousands, except per share amounts)
  Year ended December 31,2010
    
    
    2009
    
    
    2008Income tax provision:Deferred:Federal
    
    $
    (1,908
    )
    
    $
    (2,088
    )
    
    $
    (5,179
    )State
    
    
    (148
    )
    
    
    485
    
    
    
    (990
    )Foreign
    
    
    (328
    )
    
    
    (693
    )
    
    
    (1,144
    )Change in valuation allowance
    
    
    2,384
    
    
    
    2,296
    
    
    
    7,313Total income tax expense (benefit)
    
    $
    
    
    
    $
    
    
    
    $
    
   Year ended December 31,2010
    
    
    2009
    
    
    2008Federal statutory rate
    
    
    (34.0)
    %
    
    
    (34.0)
    %
    
    
    (34.0)
    %State taxes
    
    
    (2.0
    )
    
    
    (3.3
    )
    
    
    (4.8
    )Foreign rate differential
    
    
    0.5
    
    
    
    0.9
    
    
    
    (0.6
    )Stock-based compensation
    
    
    1.5
    
    
    
    1.1
    
    
    
    1.0Intangibles expense
    
    
    
    
    
    
    
    
    
    
    3.0Other
    
    
    0.3
    
    
    
    0.1
    
    
    
    0.1Change in estimated tax rate
    
    
    3.5
    
    
    
    12.6
    
    
    
    (0.6
    )Change in valuation allowance
    
    
    30.2
    
    
    
    22.6
    
    
    
    35.9
    %
    
    
    
    %
    
    
    
    %
 F-31




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(in thousands, except per share amounts)
 NOTE 11: SELECTED QUARTERLY FINANCIAL INFORMATION (UNAUDITED)
  Quarter EndedMarch 31
    
    
    June 30
    
    
    September 30
    
    
    December 312010Sales
    
    $
    1,075
    
    
    $
    1,916
    
    
    $
    2,672
    
    
    $
    2,904Gross profit
    
    
    424
    
    
    
    914
    
    
    
    1,324
    
    
    
    1,323Loss from operations
    
    
    (2,761
    )
    
    
    (2,056
    )
    
    
    (1,387
    )
    
    
    (1,651
    )Net loss
    
    $
    (2,753
    )
    
    $
    (2,064
    )
    
    $
    (1,402
    )
    
    $
    (1,664
    )Net loss per share  basic and diluted
    
    $
    (0.16
    )
    
    $
    (0.12
    )
    
    $
    (0.08
    )
    
    $
    (0.09
    )2009Sales
    
    $
    1,433
    
    
    $
    963
    
    
    $
    1,076
    
    
    $
    1,537Gross profit
    
    
    273
    
    
    
    220
    
    
    
    362
    
    
    
    568Loss from operations
    
    
    (2,943
    )
    
    
    (2,669
    )
    
    
    (2,478
    )
    
    
    (2,163
    )Net loss
    
    $
    (2,903
    )
    
    $
    (2,655
    )
    
    $
    (2,471
    )
    
    $
    (2,154
    )Net loss per share  basic and diluted
    
    $
    (0.20
    )
    
    $
    (0.18
    )
    
    $
    (0.17
    )
    
    $
    (0.13
    )
 NOTE 12: IMPAIRMENT OF NETWORK EQUIPMENT HELD FOR SALE
   F-32




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(in thousands, except per share amounts)
     F-33




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(in thousands, except per share amounts)
    NOTE 13: SEVERANCE EXPENSE
    F-34




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(in thousands, except per share amounts)
   For the Years Ended December 31,2010
    
    
    2009
    
    
    2008Cost of sales
    
    $
    
    
    
    $
    85
    
    
    $
    43Sales and marketing
    
    
    
    
    
    
    
    
    
    
    9Research and development
    
    
    
    
    
    
    
    
    
    
    202General and administrative
    
    
    
    
    
    
    362
    
    
    
    779Total
    
    $
    
    
    
    $
    447
    
    
    $
    1,033
 Accrual
    
    
    
    
    
    
    
    
    
    
    AccrualDecember 31,
    
    
    Net
    
    
    
    
    
    
    December 31,2009
    
    
    Additions
    
    
    Payments
    
    
    2010Employee severance expense
    
    $
    37
    
    
    $
    
    
    
    $
    (37
    )
    
    $
    
  NOTE 14: SUBSEQUENT EVENTS
  F-35




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##### Table of Contents



WIRELESS RONIN TECHNOLOGIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(in thousands, except per share amounts)
  F-36




---



##### Table of Contents



EXHIBIT INDEX
 ExhibitNumber
    
    Description3.1
    
    Articles of Incorporation of the Registrant, as amended (incorporated by reference to our
Pre-Effective Amendment No. 1 to our Form SB-2 filed on October 12, 2006 (File No. 333-
136972)).3.2
    
    Bylaws of the Registrant, as amended (incorporated by reference to our Current Report on
Form 8-K filed on January 11, 2011 (File No. 001-33169)).4.1
    
    See exhibits 3.1 and 3.2.4.2
    
    Specimen common stock certificate of the Registrant (incorporated by reference to Pre-
Effective Amendment No. 1 to our Form SB-2 filed on October 12, 2006 (File No. 333-
136972)).4.3
    
    Form of Current Warrant to Purchase Common Stock of the Registrant (incorporated by
reference to our Registration Statement on Form SB-2 filed on August 29, 2006 (File No.
333-136972)).4.4
    
    Form of Previous Warrant to Purchase Common Stock of the Registrant (incorporated by
reference to our Registration Statement on Form SB-2 filed on August 29, 2006 (File No.
333-136972)).4.5
    
    Form of Warrant to Purchase Common Stock pursuant to 2010 Registered Direct Offering.10.1
    
    Wireless Ronin Technologies, Inc. Amended and Restated 2006 Equity Incentive Plan
(incorporated by reference to our Definitive Proxy Statement on Schedule 14A filed on
April 29, 2010 (File No. 001-33169)).10.2
    
    Wireless Ronin Technologies, Inc. 2006 Non-Employee Director Stock Option Plan
(incorporated by reference to our Definitive Proxy Statement on Schedule 14A filed on
December 26, 2006 (File No. 001-33169)).10.3
    
    Wireless Ronin Technologies, Inc. Amended and Restated 2007 Associate Stock
Purchase Plan (incorporated by reference to our Definitive Proxy Statement on Schedule
14A filed on April 29, 2010 (File No. 001-33169)).10.4
    
    Form of Non-Qualified Stock Option Agreement Granted under the Wireless Ronin
Technologies, Inc. Amended and Restated 2006 Equity Incentive Plan (incorporated by
reference to our Registration Statement on Form SB-2 filed on August 29, 2006 (File No.
333-136972)).10.5
    
    Form of Incentive Stock Option Agreement Granted under the Wireless Ronin
Technologies, Inc. Amended and Restated 2006 Equity Incentive Plan (incorporated by
reference to our Annual Report on Form 10-KSB filed on March 28, 2007 (File No. 001-
33169)).10.6
    
    Form of Non-Qualified Stock Option Agreement for Non-Employee Directors under the
Wireless Ronin Technologies, Inc. Amended and Restated 2006 Equity Incentive Plan
(incorporated by reference to our Quarterly Report on Form 10-Q filed on November 10,
2008) (File No. 001-33169)).10.7
    
    Form of Restricted Stock Award Agreement under the Wireless Ronin Technologies, Inc.
Amended and Restated 2006 Equity Incentive Plan (incorporated by reference to our
Quarterly Report on Form 10-Q filed on August 7, 2009 (File No. 001-33169)).
 E-1




---



##### Table of Contents



EXHIBIT INDEX
 ExhibitNumber
    
    Description10.8
    
    Form of Non-Qualified Stock Option Agreement for Stephen F. Birke under the Wireless
Ronin Technologies, Inc. Amended and Restated 2006 Equity Incentive Plan
(incorporated by reference to our Quarterly Report on Form 10-Q filed on November 10,
2008) (File No. 001-33169)).10.9
    
    Form of Non-Qualified Stock Option Agreement Granted under the Wireless Ronin
Technologies, Inc. 2006 Non-Employee Director Stock Option Plan (incorporated by
reference to our Annual Report on Form 10-K filed on March 26, 2009 (File No. 001-
33169)).10.10
    
    Employment Agreement, dated as of March 9, 2009, between the Registrant and Darin P.
McAreavey (incorporated by reference to our Current Report on Form 8-K filed on March
9, 2009 (File No. 001-33169)).10.11
    
    Form of Amendment to Executive Employment Agreements, entered into by the Registrant
and each of our executive officers, dated May 8, 2008 (incorporated by reference to our
Quarterly Report on Form 10-Q filed on August 8, 2008 (File No. 001-33169)).10.12
    
    Form of Amendment to Executive Employment Agreements, entered into by the Registrant
and each of our executive officers, dated December 31, 2008 (incorporated by reference to
our Annual Report on Form 10-K filed March 13, 2009 (File No. 001-33169)).10.13
    
    Separation Agreement and General Release between the Registrant and Brian S.
Anderson, dated June 3, 2009 (incorporated by reference to our Quarterly Report on Form
10-Q filed on August 7, 2009 (File No. 001-33169)).10.14
    
    Separation Agreement dated March 6, 2009, between Robert W. Whent and the Registrant
(incorporated by reference to our Current Report on Form 8-K filed on March 9, 2009 (File
No. 001-33169)).10.15
    
    Amended and Restated Executive Employment Agreement by and between the Registrant
and James C. Granger, dated April 21, 2010 (incorporated by reference to our Current
Report on Form 8-K filed on April 21, 2010 (File No. 001-33169)).10.16
    
    Amended and Restated Executive Employment Agreement by and between the Registrant
and Scott W. Koller, dated December 28, 2010 (incorporated by reference to our Current
Report on Form 8-K filed on December 29, 2010 (File No. 001-33169)).10.17
    
    Amendment No. 1 to the Executive Employment Agreement by and between the
Registrant and Darin P. McAreavey, dated December 28, 2010 (incorporated by reference
to our Current Report on Form 8-K filed on December 29, 2010 (File No. 001-33169)).
 E-2




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##### Table of Contents



EXHIBIT INDEX
 ExhibitNumber
    
    Description10.18
    
    2010 Senior Management Bonus Plan (incorporated by reference to our Current Report on
Form 8-K/A filed January 6, 2010 (File No. 001-33169)).10.19
    
    2011 Senior Management Bonus Plan (incorporated by reference to our Current Report on
Form 8-K filed December 29, 2010 (File No. 001-33169)).10.20
    
    Lease Agreement by and between the Registrant and Utah State Retirement Investment
Fund, dated April 26, 2007 (incorporated by reference to our Current Report on Form 8-K
filed on April 30, 2007 (File No. 001-33169)).10.21
    
    First Amendment to Lease by and between the Registrant and Utah State Retirement
Investment Fund, dated July 14, 2010 (incorporated by reference to our Quarterly Report
on Form 10-Q filed on November 5, 2010 (File No. 001-33169)).10.22
    
    Second Amendment to Lease Agreement by and between the Registrant and Utah State
Retirement Investment Fund, dated August 4, 2010 (incorporated by reference to our
Quarterly Report on Form 10-Q filed on November 5, 2010 (File No. 001-33169)).10.23
    
    Amendment of Lease Agreement by and between Wireless Ronin Technologies (Canada),
Inc. and Dieter Schwarz, dated July 8, 2009 (incorporated by reference to our Quarterly
Report on Form 10-Q filed on August 7, 2009 (File No. 001-33169)).10.24
    
    Loan and Security Agreement by and between the Registrant and Silicon Valley Bank,
dated March 18, 2010 (incorporated by reference to our Current Report on Form 8-K filed
on March 24, 2010 (File No. 001-33169)).10.25
    
    Intellectual Property Security Agreement by and between the Registrant and Silicon
Valley Bank, dated March 18, 2010 (incorporated by reference to our Current Report on
Form 8-K filed on March 24, 2010 (File No. 001-33169)).10.26
    
    Stock Pledge Agreement by and between the Registrant and Silicon Valley Bank, dated
March 18, 2010 (incorporated by reference to our Current Report on Form 8-K filed on
March 24, 2010 (File No. 001-33169)).10.27
    
    Warrant to Purchase Stock issued by the the Registrant to Silicon Valley Bank, dated
March 18, 2010 (incorporated by reference to our Current Report on Form 8-K filed on
March 24, 2010 (File No. 001-33169)).10.28
    
    Placement Agency Agreement between the Registrant, Feltl and Company, Inc. and
Barrington Research Associates, Inc., dated November 4, 2009 (incorporated by reference
to our Current Report on Form 8-K filed on November 5, 2009 (File No. 001-33169)).10.29
    
    Form of Subscription Agreement for First 2009 Registered Direct Offering (incorporated
by reference to our Current Report on Form 8-K filed on November 5, 2009 (File No. 001-
33169)).10.30
    
    Placement Agency Agreement between the Registrant and Feltl and Company, Inc., dated
November 12, 2009 (incorporated by reference to our Current Report on Form 8-K filed on
November 13, 2009 (File No. 001-33169)).10.31
    
    Form of Subscription Agreement for Second 2009 Registered Direct Offering (incorporated
by reference to our Current Report on Form 8-K filed on November 13, 2009 (File No. 001-
33169)).
 E-3




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##### Table of Contents



EXHIBIT INDEX
 ExhibitNumber
    
    Description10.32
    
    Form of Subscription Agreement for 2010 Registered Direct Offering.10.33
    
    Placement Agency Agreement between the Registrant and Northland Capital Markets,
dated October 26, 2010 (incorporated by reference to our Current Report on Form 8-K filed
on November 16, 2010 (File No. 001-33169)).10.34
    
    First Amendment to Placement Agency Agreement between the Registrant and Northland
Capital Markets, dated December 20, 2010.10.35
    
    First Loan Modification Agreement by and between the Registrant and Silicon Valley
Bank, dated January 21, 2011 (incorporated by reference to our Current Report on Form 8-
K filed on January 21, 2011 (File No. 001-33169)).10.36
    
    Amendment No. 1 to Warrant to Purchase Stock issued by the Registrant to SVB
Financial Group dated January 21, 2011 (incorporated by reference to our Current Report
on Form 8-K filed on January 21, 2011 (File No. 001-33169)).21
    
    Subsidiaries of the Registrant.23
    
    Consent of Independent Registered Public Accounting Firm.31.1
    
    Chief Executive Officer Certification pursuant to Exchange Act Rule 13a-14(a).31.2
    
    Chief Financial Officer Certification pursuant to Exchange Act Rule 13a-14(a).32.1
    
    Chief Executive Officer Certification pursuant to 18 U.S.C. Section 1350.32.2
    
    Chief Financial Officer Certification pursuant to 18 U.S.C. Section 1350
 E-4