Symptoms

Client tools installed on local machine.
Error when add smartforms client event in K2 studio.

"An exception occurred. Exception: Authentication With Server Failed: Unknown error (0x0000413)"
 

Diagnoses

Local machine is not joined to the same domain as K2, so K2 Studio on machine is trying to access K2 environment using the machine's current credential.
 

Resolution

Please note, due to security concerns, K2 is designed to allow machines within the same domain to deploy solutions.