Acquisitions and Strategic Growth - The acquisition of COMSovereign Corp. was completed on November 27, 2019, for approximately $75 million, expected to drive profitable growth in new markets and benefit from key industry trends like 5G infrastructures and IoT [30]. - The proposed acquisition of Virtual Network Communications Inc. (VNC) is contingent upon raising at least $3 million in gross proceeds from equity or debt securities [32]. - DragonWave, acquired in April 2019, is the second largest provider of licensed point-to-point microwave backhaul radios in North America, with installations in over 330,000 locations across more than 100 countries [33]. - The acquisition of Sovereign Plastics in March 2020 aims to reduce production cycles for components from months to days, enhancing operational efficiency [40]. - The company has expanded its service offerings and geographic reach through a series of acquisitions over the past two years, targeting various elements of the North American telecom infrastructure [33]. - The company is pursuing strategic acquisitions to enhance earnings and expand geographic reach, contributing to accelerated revenue growth [66]. Market Trends and Connectivity - The mobile industry contributed $4 trillion to the global GDP last year, accounting for almost 5% of the total GDP, with a 10% increase in mobile broadband connectivity potentially leading to a 2% GDP increase in both developed and underdeveloped regions [53]. - As of Q4 2019, 33 operators across 18 countries had launched commercial 5G mobile services, with 77 operators planning to launch 5G services soon, indicating a growing investment in 5G infrastructure [43]. - Less than 10% of the global population (approximately 750 million) lacks access to mobile broadband, down from approximately 24% five years ago, highlighting improvements in connectivity [49]. - The transition to 5G is expected to enhance mobile broadband, support billions of IoT connections, and provide low latency for critical applications [55]. Product Development and Innovation - The introduction of In-Band Full-Duplex technology is expected to double data throughput on existing antennae, with commercial rollout anticipated in early 2021 [70]. - The Harmony Enhanced radios can deliver over 2 billion bits per second (Gbps) in a single radio, with scalability to 4 Gbps via MIMO in a single channel [69]. - The InduraPower subsidiary's lithium-ion batteries offer a lifespan approximately five times longer than conventional lead-acid batteries, with a 70% reduction in weight [73]. - The WASP tethered aerostat system provides tactical aerial monitoring capabilities, designed for military and national security applications [75]. Operational Efficiency and Cost Management - The company aims to reduce manufacturing costs by up to 45% for certain products through the acquisition of Sovereign Plastics, enhancing overall profitability [67]. - The manufacturing of microwave radios is outsourced to Benchmark Electronics, allowing for reduced costs and quick adjustments to customer demand [83]. - The company maintains a contract manufacturing relationship to enhance operational efficiency and scale-up capacity [85]. Research and Development - The company focuses its research and development efforts on product areas with potential for significant sales within a one-to-three-year period [92]. - As of December 31, 2019, the company had 72 patents granted and six patent applications pending in the United States and foreign jurisdictions [95]. Employee Relations and Workforce - The company employed 80 full-time employees, with 24 in research and development, 26 in operations, and 30 in executive and administrative roles as of December 31, 2019 [103]. - The company has never experienced a work stoppage and considers employee relations to be good, with no employees represented by labor organizations [103]. Competitive Landscape and Market Challenges - The telecommunications and mobile broadband markets are highly competitive, with principal competitors including Ericsson, Nokia, and Huawei [89]. - The company does not anticipate difficulties in obtaining raw materials necessary for production, although some components for Drone Aviation products are custom-made and sourced from limited suppliers [87][88]. - The company’s products and services are subject to export controls and economic sanctions, which may affect its ability to operate internationally [98]. - The company has a program to identify technology for patent protection and relies on various legal protections for its intellectual property rights [93]. - The company’s business may be affected by global trade and tariff policies, which can increase production costs and impact pricing [97]. Sales and Market Penetration - The company plans to enhance sales growth by expanding its direct sales force in North America and leveraging over 700 existing customers to increase market penetration [60].

Financial Performance - Revenues for the nine months ended September 30, 2019, increased by $3,124,996, or 314%, to $4,120,834 compared to $995,838 for the same period in 2018[119] - Gross profit for the nine months ended September 30, 2019, was $2,351,228, an increase of $1,893,007, or 413%, from $458,221 in the same period in 2018, with gross profit margins of 57% and 46% respectively[121] - Net loss decreased by $3,469,192, or 88%, to $475,064 for the nine months ended September 30, 2019, from a net loss of $3,944,256 for the same period in 2018[125] - The company recognized $4.1 million in gross revenue through September 30, 2019, and expects to recognize substantially all remaining revenue by the end of 2019, representing a 144% increase over the approximately $2.7 million gross revenue reported for the entire twelve months of 2018[104] Expenses and Cash Flow - General and administrative expenses decreased by $1,425,764, or 34%, to $2,732,430 for the nine months ended September 30, 2019, from $4,158,194 for the same period in 2018[122] - The company had $1,624,758 in cash as of September 30, 2019, compared to $2,282,365 at December 31, 2018, a decrease of $657,607[126] - Net cash used in operating activities was $2,461,331 for the nine months ended September 30, 2019, a decrease of 7% from $2,291,315 in the same period of 2018[137] - The company invested $104,026 in investing activities during the nine months ended September 30, 2019, compared to $54,721 net cash provided in the same period of 2018[138] - Net cash provided by financing activities was $1,907,750 for the nine months ended September 30, 2019, compared to $1,800,000 in the same period of 2018[139] Assets and Liabilities - Total current assets increased to $4,470,135 with total current liabilities of $2,595,287, resulting in working capital of $1,874,848 at September 30, 2019, compared to $212,879 at December 31, 2018[127] - As of September 30, 2019, the company reported cash of $1,624,758 and working capital of $1,874,848, with a net loss of $475,064 for the nine months ended[128] - The company has $2,000,000 drawn against the CNB Line of Credit, with accrued interest of $8,097 recorded as of September 30, 2019[132] - The company is dependent on significant shareholders to provide or loan funds to meet working capital needs, as there are currently no agreements for additional financing[131] - As of September 30, 2019, the company had an accumulated deficit of $38,947,154[134] Business Development - The company announced a $3.8 million WASP award and a $1.1 million award for WASP Lite systems, contributing to over $6.6 million in new business in the first nine months of 2019[104] - The company plans to continue considering strategic transactions, including acquisitions and joint ventures, to expand its business[108] - The company delivered upgraded real-time video distribution technology for U.S. Army WASP aerostats and received a patent allowance for converting battery-powered drones into ground-powered tethered drones[106] - The company expects a substantial increase in revenues for the remainder of 2019, supported by a $3.7 million order for aerostats announced in December 2018 and additional orders totaling $2.8 million in 2019[128] - The company raised over $4 million through stock sales in December 2018, providing ample working capital for WASP system production[128]

? DRONE AVIATION CORP DRONE AVIATION HOLDING CORP. (OTCQB: DRNE) Investor Presentation September 2019 TAMING ALTITUDE™ FORWARD-LOOKING STATEMENT Certain information and statements in this presentation constitute forward-looking statements. Words such as forecast, project, intend, expect, should, would, could, may, will, anticipates, believes, plans and other similar expressions and all statements which are not historical facts are considered forward-looking statements or information. These statements are ba ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Nevada 46-5538504 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.) Title of each class Trading Symbol(s) Name of each exchange on which registered None N/A N/A FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended June 30, 2019 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended 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: 333-150332 DRONE AVIATION HOLDING CORP. (Exact name of registrant as specified in its charter) | --- | --- | |- ...

< PRONE DRONE AVIATION HOLDING CORP. (OTCQB: DRNE) Investor Presentation April 2019 TAMING ALTITUDE™ FORWARD-LOOKING STATEMENT Certain information and statements in this presentation constitute forward-looking statements. Words such as forecast, project, intend, expect, should, would, could, may, will, anticipates, believes, plans and other similar expressions and all statements which are not historical facts are considered forward-looking statements or information. These statements are based on DRNE's curr ...

Part I [Business](index=5&type=section&id=Item%201.%20Business) Drone Aviation Holding Corp. develops and sells tethered aerial platforms, primarily WASP systems, for national defense and security ISR and communications - The company's primary business is designing and selling tethered aerial platforms, including the WASP aerostat and other tethered drones, for military and security ISR and communications applications[18](index=18&type=chunk) - The core product focus is the Winch Aerostat Small Platform (WASP), a mobile, tactical aerostat system capable of carrying payloads up to **90 pounds** to an altitude of up to **1,500 feet**[19](index=19&type=chunk)[21](index=21&type=chunk) - The company's primary customers are U.S. Government entities, including the Department of Defense (DoD) and Department of Homeland Security (DHS), with significant future revenue expected from these sources[21](index=21&type=chunk)[47](index=47&type=chunk)[57](index=57&type=chunk) - In December 2018, the company was awarded a subcontract valued at **$3.8 million** for six WASP aerostat systems for U.S. southern border deployment by Customs and Border Protection (CBP)[58](index=58&type=chunk) - The company holds a key patent (No. 9,446,858) for its electric tethered aerial platform (ETAP) technologies, a core competitive differentiator[35](index=35&type=chunk)[43](index=43&type=chunk) Research & Development Expenses | Year | Amount Spent ($) | | :--- | :--- | | 2018 | $107,015 | | 2017 | $351,768 | [Risk Factors](index=11&type=section&id=Item%201A.%20Risk%20Factors) The company faces substantial risks from reliance on government contracts, intense competition, funding needs, supply chain vulnerabilities, and limited stock liquidity as a penny stock - The company is heavily dependent on U.S. Government contracts, which are subject to congressional appropriations and shifting political priorities, posing a risk to revenue stability[65](index=65&type=chunk)[66](index=66&type=chunk) - The company competes with large, well-funded defense contractors such as TCOM, Raytheon, and Lockheed Martin, possessing significantly greater financial, technical, and marketing resources[36](index=36&type=chunk)[69](index=69&type=chunk)[70](index=70&type=chunk) - The company has significant debt, including a **$2 million** revolving line of credit maturing in August 2019, and may require additional funding to continue operations, which could lead to shareholder dilution[93](index=93&type=chunk)[97](index=97&type=chunk) - The company's common stock is quoted on the OTCQB market and is subject to SEC 'penny stock' rules, creating limited liquidity and potentially cumbersome transactions for investors[106](index=106&type=chunk)[110](index=110&type=chunk)[111](index=111&type=chunk) - There is a risk of supply chain disruption as the company relies on a limited number of suppliers for critical components and raw materials, such as helium gas for its aerostats[87](index=87&type=chunk) [Unresolved Staff Comments](index=21&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reports no unresolved staff comments from the SEC - There are no unresolved staff comments[117](index=117&type=chunk) [Properties](index=21&type=section&id=Item%202.%20Properties) The company's principal executive office and manufacturing space is a 5,533 square foot leased facility in Jacksonville, Florida, with an additional 2,390 square foot lease in Holly Hill, Florida, for aerostat manufacturing - The main office and manufacturing facility is a **5,533 sq. ft.** leased space in Jacksonville, FL under a 60-month lease that commenced in 2015[118](index=118&type=chunk) - A new 36-month operating lease for **2,390 sq. ft.** in Holly Hill, FL was signed on March 1, 2019, to expand aerostat manufacturing[118](index=118&type=chunk) [Legal Proceedings](index=21&type=section&id=Item%203.%20Legal%20Proceedings) The company is involved in a lawsuit with Banco Popular North America regarding a delinquent loan to a third party, denying liability and deeming the probability of loss possible but unestimable - The company is involved in a lawsuit with Banco Popular North America regarding a delinquent loan made to Aerial Products Corporation, denying liability and defending the case[119](index=119&type=chunk) - Management has evaluated the probability of loss as possible but is unable to estimate the range of potential loss[119](index=119&type=chunk) [Mine Safety Disclosures](index=21&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[122](index=122&type=chunk) Part II [Market for Common Equity and Related Matters](index=22&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's common stock trades on OTCQB, has never paid dividends, and recently converted **$5.1 million** in debt to equity while selling **$2 million** in stock - The company's common stock trades on the OTCQB under the symbol 'DRNE'[126](index=126&type=chunk) Quarterly Stock Price (Bid Price) | Quarter Ended | 2018 High ($) | 2018 Low ($) | 2017 High ($) | 2017 Low ($) | | :--- | :--- | :--- | :--- | :--- | | March 31 | $1.20 | $0.70 | $2.99 | $2.17 | | June 30 | $0.90 | $0.68 | $2.27 | $1.35 | | September 30 | $0.75 | $0.61 | $1.45 | $0.71 | | December 31 | $0.69 | $0.47 | $1.65 | $0.89 | - The company has never declared or paid cash dividends and does not plan to in the foreseeable future[129](index=129&type=chunk) - In December 2018, approximately **$5.1 million** of debt and accrued interest was converted into **10,208,151 shares** of common stock at **$0.50 per share**[130](index=130&type=chunk) [Management's Discussion and Analysis (MD&A)](index=23&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) In 2018, net revenues increased by **384%** to **$2.72 million**, while gross margin declined due to a **$565,000** inventory write-off, but the company significantly improved its liquidity and mitigated going concern doubts through debt conversion and capital raises Results of Operations (2018 vs. 2017) | Metric | 2018 ($) | 2017 ($) | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Total Net Revenues | $2,722,713 | $562,078 | +$2,160,635 | +384% | | Gross Profit | $508,547 | $223,499 | +$285,048 | +128% | | Gross Margin | 19% | 40% | -21 pts | -52.5% | | Loss from Operations | ($8,130,817) | ($9,846,342) | +$1,715,525 | -17% | | Net Loss | ($8,475,313) | ($10,323,992) | +$1,848,679 | -18% | - The 2018 gross margin was negatively impacted by a **$565,000** inventory write-off of slow-moving items, including FUSE tether systems and powered drone inventory, as the company shifted focus to aerostat products[137](index=137&type=chunk) Cash Flow Summary (2018 vs. 2017) | Activity | 2018 ($) | 2017 ($) | | :--- | :--- | :--- | | Cash from Operations | ($2,387,731) | ($3,326,022) | | Cash from Investing | $54,721 | ($73,817) | | Cash from Financing | $4,000,000 | $2,000,000 | - The company's liquidity position improved significantly, with working capital turning positive to **$212,879** at year-end 2018 from a deficit of **$557,195** at year-end 2017[144](index=144&type=chunk) - Management states that actions taken in 2018, including raising capital and converting debt, have mitigated the substantial doubt about the company's ability to continue as a going concern that was present in 2017[154](index=154&type=chunk)[365](index=365&type=chunk)[366](index=366&type=chunk) [Changes in and Disagreements with Accountants](index=29&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reports no disagreements with its accountants on accounting and financial disclosure - None[179](index=179&type=chunk) [Controls and Procedures](index=29&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded that disclosure controls were ineffective as of December 31, 2018, due to a material weakness in internal control over financial reporting caused by insufficient segregation of accounting duties - Management concluded that disclosure controls and procedures were not effective as of December 31, 2018[183](index=183&type=chunk) - A material weakness was identified in internal control over financial reporting: the company did not effectively segregate certain accounting duties due to the small size of its accounting staff[187](index=187&type=chunk) - Despite the material weakness, management believes the consolidated financial statements in the report are fairly presented in all material respects[188](index=188&type=chunk) Part III [Directors, Executive Officers and Corporate Governance](index=31&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) This section details the company's executive officers and board of directors, highlighting key leadership, experienced members from government and technology, and the board's independent composition and committees - The executive team includes Jay H. Nussbaum (CEO), Daniyel Erdberg (President), Kendall Carpenter (CFO), Kevin Hess (CTO), and Felicia Hess (Chief Operating Officer)[195](index=195&type=chunk) - The Board of Directors includes members with extensive government and defense industry experience, such as David Aguilar (former U.S. CBP), John E. Miller (LTG, Ret. U.S. Army), and Robert Guerra[195](index=195&type=chunk)[203](index=203&type=chunk)[205](index=205&type=chunk)[206](index=206&type=chunk) - The Board has determined that directors John Miller, David Aguilar, Robert Guerra, and Timothy Hoechst are independent[210](index=210&type=chunk) - The company has adopted a Code of Ethics and Business Conduct applicable to all directors, officers, and employees[216](index=216&type=chunk) [Executive Compensation](index=35&type=section&id=Item%2011.%20Executive%20Compensation) This section details executive and non-employee director compensation for 2017-2018, including salaries, bonuses, and significant stock and option awards, with CEO Jay Nussbaum's 2018 total compensation at **$1.66 million** 2018 Summary Compensation Table | Name and Principal Position | Salary ($) | Bonus ($) | Stock Awards ($) | Option Awards ($) | Total ($) | | :--- | :--- | :--- | :--- | :--- | :--- | | Jay Nussbaum, CEO & Chairman | 245,000 | 225,000 | 315,000 | 848,017 | 1,662,113 | | Felicia Hess, COO | 150,833 | 25,000 | 302,050 | 347,904 | 848,531 | | Daniyel Erdberg, President | 165,833 | 175,000 | 232,750 | 347,904 | 939,012 | - Employment agreements are in place for key executives, with base salaries for 2019 set at **$300,000** for the CEO, **$175,000** for the President, and **$160,000** for the Chief Quality Officer[228](index=228&type=chunk)[231](index=231&type=chunk)[234](index=234&type=chunk) - In March 2019, CTO Kevin Hess transitioned from an employee to an independent contractor, providing services through a corporation owned by his spouse, Felicia Hess (the company's Chief Quality Officer)[229](index=229&type=chunk) 2018 Director Compensation | Name | Fees Earned or Paid in Cash ($) | Stock Awards ($) | Total ($) | | :--- | :--- | :--- | :--- | | Robert Guerra | 20,500 | 32,611 | 53,111 | | David Aguilar | 26,500 | 120,073 | 146,573 | | Timothy Hoechst | 26,500 | 46,096 | 72,596 | | LTG John E. Miller (Ret.) | 38,500 | 46,009 | 84,509 | | **Total** | **112,000** | **244,786** | **356,789** | [Security Ownership](index=43&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) This section details beneficial ownership as of March 21, 2019, showing Dr. Phillip Frost as the largest shareholder at **46.1%**, and executive officers and directors collectively owning **63.5%**, indicating high ownership concentration Beneficial Ownership (as of March 21, 2019) | Name of Beneficial Owner | Percentage of Class (%) | | :--- | :--- | | Dr. Phillip Frost | 46.1% | | Jay Nussbaum (CEO) | 33.0% | | Felicia Hess (COO) | 12.2% | | Daniyel Erdberg (President) | 11.1% | | **Executive Officers and Directors as a Group (9 persons)** | **63.5%** | - Ownership is highly concentrated, with Dr. Phillip Frost and the executive officers/directors group controlling a majority of the company's stock[254](index=254&type=chunk) [Related Party Transactions](index=45&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) The company engaged in significant related-party transactions, including the conversion of **$5 million** in convertible notes from major shareholders and CEO to common stock, a consulting agreement with a director's firm, and a restructured employment agreement for the CTO with his spouse's company - In December 2018, **$3.0 million** of Series 2016 Convertible Notes held by Frost Gamma and CEO Jay Nussbaum were converted into common stock at **$0.50 per share**[264](index=264&type=chunk) - In December 2018, a **$2.0 million** Series 2017 Convertible Note held by Frost Nevada Investments Trust was converted into common stock at **$0.50 per share**[266](index=266&type=chunk)[267](index=267&type=chunk) - The company has a consulting agreement with Global Security Innovative Strategies, LLC (GSIS), paying **$10,000 per month** for business development services, where Director David Aguilar is a principal[269](index=269&type=chunk) - CTO Kevin Hess is married to Chief Quality Officer Felicia Hess; in March 2019, his employment was converted to an independent contractor agreement with Cognitive Carbon Corporation, a company wholly owned by Felicia Hess[208](index=208&type=chunk)[271](index=271&type=chunk) [Principal Accounting Fees and Services](index=48&type=section&id=Item%2014.%20Principal%20Accounting%20Fees%20and%20Services) This section discloses fees billed by MaloneBailey, LLP, totaling **$63,000** in 2018 and **$61,000** in 2017, exclusively for audit services with no other fees incurred Accountant Fees | Fee Type | 2018 ($) | 2017 ($) | | :--- | :--- | :--- | | Audit Fees | $63,000 | $61,000 | | Audit-Related Fees | - | - | | Tax Fees | - | - | | All Other Fees | - | - | | **Total** | **$63,000** | **$61,000** | - All fees paid to the independent auditor in 2018 and 2017 were for audit services[277](index=277&type=chunk)[278](index=278&type=chunk)[279](index=279&type=chunk) Part IV [Exhibits and Financial Statement Schedules](index=49&type=section&id=Item%2015.%20Exhibits%2C%20Financial%20Statement%20Schedules) This section provides an index to the consolidated financial statements and a comprehensive list of all exhibits filed with the 10-K, including governance documents, material contracts, and certifications - This section provides an index to the Consolidated Financial Statements, which begin on page F-1[283](index=283&type=chunk)[284](index=284&type=chunk) - A detailed list of exhibits is provided, including articles of incorporation, bylaws, material contracts, and employment agreements[285](index=285&type=chunk)[287](index=287&type=chunk)[288](index=288&type=chunk)[290](index=290&type=chunk)[292](index=292&type=chunk) Financial Statements [Auditor's Report](index=57&type=section&id=Report%20of%20Independent%20Registered%20Public%20Accounting%20Firm) MaloneBailey, LLP issued an unqualified opinion on the consolidated financial statements for 2018 and 2017, affirming fair presentation in conformity with U.S. GAAP and PCAOB standards - The auditor, MaloneBailey, LLP, provided an unqualified opinion on the consolidated financial statements[305](index=305&type=chunk) - The company was not required to have, nor was the auditor engaged to perform, an audit of its internal control over financial reporting[307](index=307&type=chunk) [Consolidated Financial Statements](index=58&type=section&id=Consolidated%20Financial%20Statements) The 2018 consolidated financial statements show total assets at **$3.56 million**, a dramatic decrease in liabilities to **$2.49 million** due to debt conversion, resulting in positive stockholders' equity of **$1.07 million**, and a net loss of **$8.48 million** Consolidated Balance Sheet Data (at Dec 31) | Account | 2018 ($) | 2017 ($) | | :--- | :--- | :--- | | Cash | $2,282,365 | $615,375 | | Total Current Assets | $2,697,903 | $1,820,145 | | Total Assets | $3,556,599 | $3,073,548 | | Total Current Liabilities | $2,485,024 | $2,377,340 | | Total Liabilities | $2,485,024 | $5,377,340 | | Total Stockholders' Equity (Deficit) | $1,071,575 | ($2,303,792) | Consolidated Statement of Operations Data (Year Ended Dec 31) | Account | 2018 ($) | 2017 ($) | | :--- | :--- | :--- | | Revenues | $2,722,713 | $562,078 | | Gross Profit | $508,547 | $223,499 | | Loss from Operations | ($8,130,817) | ($9,846,342) | | Net Loss | ($8,475,313) | ($10,323,992) | | Basic and Diluted Net Loss per Share | ($0.89) | ($1.15) | [Notes to Consolidated Financial Statements](index=62&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes detail accounting policies and financial results, including management's liquidity plan mitigating going concern doubts, **$5 million** in related-party debt conversion, a **$2 million** credit facility, high customer concentration, and **$2 million** in subsequent capital raises - Management concluded that its 2018 actions, including raising over **$4 million** in capital and converting **$5 million** in debt to equity, mitigated the substantial doubt about its ability to continue as a going concern that existed in 2017 (Note 2)[365](index=365&type=chunk)[366](index=366&type=chunk) - In December 2018, **$5,000,000** in principal of convertible notes held by related parties (Frost entities and CEO Jay Nussbaum) plus accrued interest were converted into common stock, significantly deleveraging the balance sheet (Note 6 & 8)[381](index=381&type=chunk)[389](index=389&type=chunk) - The company has a **$2,000,000** revolving line of credit with City National Bank of Florida, fully drawn as of Dec 31, 2018, maturing in August 2019, and personally guaranteed by CEO Jay Nussbaum (Note 7)[385](index=385&type=chunk) - The company has a high customer concentration, with one customer accounting for **95%** of total revenues in 2018 (Note 15)[440](index=440&type=chunk) - Subsequent to year-end, in January 2019, the company raised an additional **$2,007,750** through the sale of common stock at **$0.50 per share** (Note 16)[441](index=441&type=chunk)