Mergers and Agreements - The company completed a merger on May 28, 2020, with AYRO Operating, resulting in former AYRO Operating equity holders owning approximately 79% of the outstanding equity of the company [160]. - The company has a Master Procurement Agreement with Club Car, which grants Club Car exclusive rights to sell the company's four-wheeled vehicle in North America, requiring a minimum order of 500 vehicles per year [167]. - The company entered into a Securities Purchase Agreement on June 17, 2020, issuing 2,200,000 shares at $2.50 per share, raising approximately $5.5 million before fees [168]. - On July 6, 2020, the company issued 3,157,895 shares at $4.75 per share, generating gross proceeds of approximately $15.0 million before fees [169]. - The company entered into a Master Manufacturing Services Agreement with Karma Automotive for 12 months, with compensation of $1,160,800 for manufacturing services [171]. - The company has developed a strategic partnership with Autonomic, a division of Ford, to jointly develop cloud-based vehicle applications [165]. Financial Performance - For the three months ended September 30, 2020, total revenue increased by $123,173, or 46.4%, compared to the same period in 2019, primarily due to increased vehicle sales and specialty product sales [189]. - Cost of goods sold increased by $124,642, or 61.7%, for the three months ended September 30, 2020, corresponding with the increase in revenue [190]. - Gross margin percentage was 15.9% for the three months ended September 30, 2020, down from 23.9% for the same period in 2019, primarily due to initial one-time costs in production runs [191]. - Research and development expense increased by $366,465, or 123.1%, for the three months ended September 30, 2020, driven by increased engineering investment [192]. - Sales and marketing expense decreased by $127,395, or 29.5%, for the three months ended September 30, 2020, primarily due to reduced contracting for professional services [193]. - General and administrative expense increased by $70,642, or 5.0%, for the three months ended September 30, 2020, due to increased professional services and corporate expansion [194]. - Net loss attributable to common stockholders for the three months ended September 30, 2020, was $3,113,453, compared to a net loss of $2,141,840 for the same period in 2019 [188]. - Total revenue for the nine months ended September 30, 2020, increased by $75,868, or 10.2%, compared to the same period in 2019, primarily due to increased vehicle sales and specialty product sales [199]. - Cost of goods sold increased by $67,924 for the nine months ended September 30, 2020, corresponding with the revenue increase [200]. - Gross profit percentage decreased to 21.4% for the nine months ended September 30, 2020, down from 22.5% in the same period in 2019, due to initial one-time costs in production runs [201]. - Net loss for the nine months ended September 30, 2020, was $6,006,735, compared to a net loss of $5,214,578 in the same period in 2019 [212]. - Adjusted EBITDA for the nine months ended September 30, 2020, was $(4,296,033), compared to $(3,232,185) for the same period in 2019 [212]. Cash Flow and Financing - As of September 30, 2020, the company had approximately $27,916,838 in cash and working capital of approximately $29,900,000, a significant increase from the previous year [213]. - The company raised approximately $31,349,638 from financing activities for the nine months ended September 30, 2020, compared to $3,513,062 in the same period in 2019 [222]. - AYRO used $6,542,495 in cash from operating activities for the nine months ended September 30, 2020, an increase of 106.5% compared to $3,168,709 in the same period in 2019 [223]. - AYRO generated $500,000 of debt financing from DropCar investors and $600,000 from a private investor during the nine months ended September 30, 2020, with total cash generated from financing activities amounting to $28,790,995 [226]. - AYRO provided cash of $2,467,873 in investing activities for the nine months ended September 30, 2020, compared to cash used of $322,773 in the same period in 2019, marking an increase of 666.5% [225]. - The company generated $2,983,527 from the exercise of warrants during the nine months ended September 30, 2020, with no warrants exercised in 2019 [226]. - AYRO's ability to generate cash from operations in future periods will depend on profitability, accounts receivable collections, inventory turns, and working capital management [224]. Operational Risks and Challenges - The company relies on a single third-party supplier for sub-assemblies in semi-knocked-down for all vehicles, which poses a risk to operations [158]. - The company has a history of losses and expects to incur additional losses in the future, indicating potential challenges in achieving profitability [157]. - The COVID-19 pandemic has adversely impacted the company's ability to procure raw materials and meet customer demand, which is expected to affect sales in 2020 [179]. Accounting and Financial Reporting - AYRO's revenue recognition follows ASC 606, with product revenue recognized upon the sale of electric vehicles as they are shipped to customers [238]. - The company has made certain indemnities related to transactions, but historically has not been obligated to make any payments for these obligations [228]. - AYRO does not have any off-balance sheet financing arrangements or liabilities, ensuring transparency in its financial statements [229]. - The company recorded stock-based compensation of $908,650 in October 2019 related to the termination of a royalty-based agreement [232]. - As of September 30, 2020, AYRO's inventory consists of purchased chassis, cabs, batteries, and component parts, stated at the lower of cost or net realizable value [253]. - The Company has not identified or recorded any impairment losses on long-lived assets for the three and nine months ended September 30, 2020 and 2019 [255]. - As of September 30, 2020, there were no accruals for uncertain tax positions, indicating a stable tax position [256]. - The Company is currently evaluating the impact of adopting ASU 2020-06 on its financial statements, which addresses complexities in accounting for convertible instruments [257]. - The amendments in ASU 2016-13 regarding expected credit losses will be effective for fiscal years beginning after December 15, 2022, and the Company does not expect a material impact from this guidance [258]. - The Company adopted ASU 2018-13 on January 1, 2020, which did not have a material impact on its condensed consolidated financial statements [259]. - The adoption of ASU 2017-11 on January 1, 2020, also did not materially impact the Company's unaudited condensed consolidated financial statements [260].

Financial Performance - For the three months ended June 30, 2020, total revenue decreased by $110,171, or 27.8%, compared to the same period in 2019, primarily due to the COVID-19 pandemic[181]. - Cost of goods sold decreased by $103,105, or 33.4%, for the three months ended June 30, 2020, corresponding with the decrease in revenue[182]. - Gross margin percentage increased to 28.1% for the three months ended June 30, 2020, compared to 22.1% for the same period in 2019, driven by higher-margin sales[183]. - For the six months ended June 30, 2020, total revenue decreased by $47,306, or 9.9%, compared to the same period in 2019, primarily due to the COVID-19 pandemic[190]. - The net loss for the three months ended June 30, 2020, was $1,530,857, compared to a net loss of $1,809,649 for the same period in 2019[180]. - Gross profit percentage increased to 26.3% for the six months ended June 30, 2020, from 21.8% in the same period in 2019, driven by higher-margin sales[192]. Expenses - Research and development expenses decreased by $102,586, or 36.2%, for the three months ended June 30, 2020, compared to the same period in 2019[184]. - Sales and marketing expenses decreased by $59,375, or 19.9%, for the three months ended June 30, 2020, compared to the same period in 2019[185]. - General and administrative expenses decreased by $527,927, or 42.5%, for the three months ended June 30, 2020, compared to the same period in 2019[186]. - Research and development expenses decreased by $147,621, or 30.6%, for the six months ended June 30, 2020, compared to the same period in 2019[193]. - Sales and marketing expenses increased by $57,892, or 11.6%, for the six months ended June 30, 2020, compared to the same period in 2019[194]. - General and administrative expenses decreased by $62,070, or 3.1%, for the six months ended June 30, 2020, compared to the same period in 2019[195]. Cash and Financing - As of June 30, 2020, the company had approximately $7,918,000 in cash and working capital of approximately $7,906,000, a significant increase from a working capital deficit of $(395,000) as of December 31, 2019[204]. - Net cash used in operating activities was $(2,717,923) for the six months ended June 30, 2020, an increase of $57,614 compared to the same period in 2019[214]. - The company generated $7,185,929 from financing activities during the six months ended June 30, 2020, compared to $3,144,310 in the same period in 2019[213]. - AYRO raised approximately $24,800,000 subsequent to June 30, 2020, which management believes will be sufficient to fund operations for at least the next twelve months[211]. Stock and Equity - In July 2020, the company received $2,468,189 net of fees from the exercise of warrants, issuing 2,539,769 shares of common stock[151]. - The company issued 225,590 shares of common stock upon the conversion of 7,833 shares of H-6 preferred stock in July 2020[151]. - On June 17, 2020, the company issued 2,200,000 shares at $2.50 per share, generating gross proceeds of approximately $5.5 million[163]. - On July 6, 2020, the company issued 3,157,895 shares at $4.75 per share, generating gross proceeds of approximately $15.0 million[164]. - On July 21, 2020, the company issued 1,850,000 shares at $5.00 per share, generating gross proceeds of approximately $9.25 million[165]. - The weighted-average common shares outstanding increased to 8,291,351 for the three months ended June 30, 2020, compared to 2,793,592 for the same period in 2019[180]. Strategic Partnerships - The company has a five-year Master Procurement Agreement with Club Car, granting exclusive rights to sell its four-wheeled vehicle in North America, with a minimum order of 500 vehicles per year[162]. - The company has developed a strategic partnership with Autonomic, a division of Ford, to jointly develop cloud-based vehicle applications[160]. - The company plans to continue growing its business through strategic partnerships and leveraging its supply chain for production scalability[159]. Risks and Accounting - The company is subject to various risks, including a history of losses and reliance on a single customer for a significant portion of its revenues[152]. - The Company accounts for income tax using an asset and liability approach, with no accruals for uncertain tax positions as of June 30, 2020[248]. - The Company is currently analyzing the impact of new accounting guidance on credit losses, effective for fiscal years beginning after December 15, 2022, but does not expect a material impact on financial statements[249]. - The Company adopted ASU 2017-11 on January 1, 2020, which eliminated the requirement that a down round feature precludes equity classification[251]. - The adoption of the new standard did not have a material impact on the Company's unaudited condensed consolidated financial statements[251].

Financial Data and Key Metrics Changes - Revenues for Q2 2020 were $286,000, a 28% decrease compared to Q2 2019, primarily due to delays from the COVID-19 pandemic [27] - Gross margin percentage increased from 22% to 28% quarter-over-quarter due to sales of higher margin products [27] - Net loss was approximately $1.5 million on a GAAP basis, an improvement from a net loss of approximately $1.8 million in Q2 2019 [29] - Adjusted EBITDA totaled a negative $683,000 compared to negative $1.1 million in the prior year period [29] - Cash at June 30, 2020, was $7.9 million, a significant increase from $641,000 at December 31, 2019 [30] Business Line Data and Key Metrics Changes - The company has two primary vehicle models: the four-wheeled vehicle known as the 411 and the three-wheeled vehicle known as the 311 [14] - The partnership with Club Car has expanded the sales funnel, with the company currently in about half of the commercial dealers for Club Car [37] - The 311 model is being developed specifically for food delivery, targeting a market where restaurants are looking to reduce costs associated with third-party delivery services [40] Market Data and Key Metrics Changes - The market for low-speed electric vehicles is estimated to be a multi-billion dollar market with significant growth potential over the next decade [13] - The demand for home food and restaurant delivery has increased due to COVID-19, creating new opportunities for the company's vehicles [17] - The restaurant delivery market is expected to grow by nearly 7% annually through 2024, indicating a strong potential for the 311 model [22] Company Strategy and Development Direction - The company aims to leverage strategic partnerships, such as with Club Car, to enhance growth and market penetration [20] - The focus is on B2B sales, targeting fleet operators rather than individual consumers, which allows for larger orders and reduced costs [63] - The company is investing in redesigning the 311 vehicle to enhance its features for food delivery applications [21] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the challenges posed by COVID-19 but remains optimistic about future demand and growth opportunities [11] - The company is confident in its ability to execute growth plans with sufficient capital and a strong backlog of orders [9] - Management emphasizes the importance of adapting to new market norms, particularly in food delivery, as a result of the pandemic [10] Other Important Information - The company completed a business combination with DropCar on May 28, 2020, allowing it to trade on NASDAQ [23] - The company has expanded its factory capacity to handle up to 600 electric vehicles per month, a 200% increase in production capacity [19] Q&A Session Summary Question: What are the obstacles in expanding the dealer base with Club Car? - The company works closely with Club Car to expand the dealer base, which includes 535 locations, with 167 being commercial [35] Question: What captive markets is the company looking at? - The company is exploring opportunities in food services and is developing vehicles for sports stadiums and universities [39] Question: Can you comment on the ASP for the 311 model? - The expected ASP for the 311 is around $10,000, which is competitive compared to similar vehicles [42] Question: What is the impact of tariffs on the company's supply chain? - The company faces challenges with tariffs on components sourced from China, including batteries [46] Question: What is the expected revenue potential in the next few years? - The company believes it can generate revenues in the $50 million to $100 million range with the right market conditions and product lineup [55]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 (Mark One) FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2020 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from __________________ to __________________ Commission File Number: 001-34643 DropCar, Inc. (Exact name of registrant as specified in its charter) Delaware 98-02 ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) [ X ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2019 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number: 001-34643 DROPCAR, INC. (Exact name of registrant as specified in its charter) Delaware (State or other jurisdiction of incorporat ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 (Mark One) FORM 10-Q x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2019 or ¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from __________________ to __________________ Commission File Number: 001-34643 DropCar, Inc. (Exact name of registrant as specified in its charter) Delaware 9 ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 (Mark One) FORM 10-Q x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2019 or ¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from __________________ to __________________ Commission File Number: 001-34643 DropCar, Inc. (Exact name of registrant as specified in its charter) Delaware 98-020 ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 (Mark One) FORM 10-Q x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2019 or ¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from __________________ to __________________ Commission File Number: 001-34643 DropCar, Inc. (Exact name of registrant as specified in its charter) Delaware 98-02 ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) [ X ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2018 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number: 001-34643 98-0204758 (I.R.S. Employer Identification No.) DROPCAR, INC. (Exact name of registrant as specified in its charter) Del ...