Sidus Space Inc

Previous wording

Our products and services are offered through several business units: Space-as-a-Service, Space-Based Data Solutions, Artificial Intelligence/Machine Learning (AI/ML) Products and Services, Mission Planning and Management Operations, 3D Printing Products and Services, Satellite Manufacturing and Payload Integration, and Space and Defense Hardware Manufacturing. Our vertically integrated model is complementary across each line of business aiming to expand existing and unlock new potential revenue generating opportunities.

Current wording

Our products and services are offered through several business units: Space-as-a-Service, Space-Based Data Solutions, Artificial Intelligence/Machine Learning (AI/ML) Products and Services, Mission Planning and Management Operations, 3D Printing Products and Services, Satellite Manufacturing and Payload Integration, and Space and Defense Hardware Manufacturing.

Previous wording

Our LizzieSat satellite platform has been designed to address these shortcomings by allowing for differentiated data collection when compared to industry alternatives. We plan to lead the next generation of earth and space data collection by:

Current wording

Our LizzieSat satellite platform has been designed to provide differentiated data collection when compared to industry alternatives. We plan to lead the next generation of earth and space data collection by:

Previous wording

The net value of data collected from our planned LizzieSat constellation is expected to allow organizations to make better decisions with higher confidence, and increased accuracy and speed. We expect to enrich this processed data with customizable analytics users control for their own-use case, and in turn provide data as a subscription across industries to organizations so they are able to improve decision-making and mitigate risk.

Current wording

The net value of data collected from our planned LizzieSat constellation is expected to allow organizations to make better decisions with higher confidence, and increased accuracy and speed. We expect to enrich this processed data with customizable analytics users control for their own use case, and in turn provide data as a subscription across industries to organizations so they can improve decision-making and mitigate risk.

Previous wording

We support a broad range of international and domestic governments and commercial companies including the Netherlands Organization, U.S. Department of State, the U.S. Department of Defense, NASA, Collins Aerospace, Lockheed Martin, Teledyne Marine, Bechtel, OneWeb Satellites, Parsons Corporation, and L3Harris in areas that include launch vehicles, satellite hardware, and autonomous underwater vehicles. Planned services that benefit current and future customers include delivering space-based data that can provide critical insight for agriculture, commodities tracking, disaster assessment, illegal trafficking monitoring, energy, mining, oil and gas, fire monitoring, classification of vegetation, soil moisture, carbon mass, Maritime AIS, Aviation ADS, and weather monitoring; providing the ability for customers to demonstrate that a technology (hardware or software) performs successfully in the harsh environment of space and delivering space services. We plan to own and operate one of the industry’s leading U.S. based low earth orbi small satellite (“smallsat” or “smallsats”) constellations focused on earth observation and remote sensing. Our operating strategy is to continue to enhance the capabilities of our satellite constellation, to increase our international and domestic partnerships and to expand our co-incident data analytics offerings in order to increase the value we deliver to our customers. Our two operating assets—our satellite constellation and hardware manufacturing capability—are mutually reinforcing and are a result of years of heritage and innovation.

Current wording

We support a broad range of international and domestic governments and commercial companies including the Netherlands Organization, U.S. Department of State, the U.S. Department of Defense, NASA, Collins Aerospace, Lockheed Martin, Teledyne Marine, Bechtel, OneWeb Satellites, Parsons Corporation, and L3Harris in areas that include launch vehicles, satellite hardware, and autonomous underwater vehicles. Planned services that benefit current and future customers include delivering space-based data that can provide critical insight for agriculture, commodities tracking, disaster assessment, illegal trafficking monitoring, energy, mining, oil and gas, fire monitoring, classification of vegetation, soil moisture, carbon mass, Maritime Automatic Identification System (AIS), Air Traffic Control Automatic Dependent Surveillance, and weather monitoring; providing the ability for customers to demonstrate that a technology (hardware or software) performs successfully in the harsh environment of space and delivering space services. We plan to own and operate one of the industry’s leading U.S. based low earth orbit small satellite (“smallsat” or “smallsats”) constellations focused on earth observation and remote sensing. Our operating strategy is to continue to enhance the capabilities of our satellite constellation, to increase our international and domestic partnerships and to expand our co-incident data analytics offerings in order to increase the value we deliver to our customers. Our two operating assets—our satellite constellation and hardware manufacturing capability, complement each other and stem from years of experience and innovation.

Previous wording

We have previously been approved for our X-band and S-band radio frequencies licensing through a published filing by the ITU on April 6, 2021. Such licenses are held through Aurea Alas, Ltd., an Isle of Man company, which is a Variable interest entity to us. The ITU filing contains approved spectrum use for multiple X-Band and S-Band frequencies and seven different orbital planes, including 45 degrees. In August 2023, the FCC granted Sidus a LizzieSat launch and operating license for launch and deploy on a SpaceX Falcon 9 mission called Transporter 10 to include approval for orbital operations utilizing the previously approved ITU S-band and X-band frequencies and ground station coverage. We have also filed an FCC Part 25 license request for the LizzieSat satellite constellation missions two through five. The FCC Part 25 license request has completed the mandatory review period and is pending approval. The National Oceanic and Atmospheric Administration (NOAA), an agency of the U.S. Department of Commerce, granted a Tier 1 license authorizing Sidus to operate LizzieSat1-3, a private remote-sensing space system comprised of three satellites (LizzieSat#1 through LizzieSat #3 or LS-1 through LS-3) in 2024. The imagery from Near-infrared and Short-wave infrared imagers will be integrated into our FeatherBox AI onboard processor and combined with AIS data to detect marine traffic migration and illegal fishing activities, detect methane emissions and detect vegetative stress in various agricultural areas. Any delays in commencing our commercial launch operations, including delays or cost overruns in obtaining NOAA licenses or other regulatory approvals for future operations or frequency requirements, could adversely impact our results and growth plans.

Current wording

We have previously been approved for our X-band and S-band radio frequencies licensing through a published filing by the ITU on April 6, 2021. Such licenses are held through Aurea Alas, Ltd., an Isle of Man company, which is a Variable interest entity to us. The ITU filing contains approved spectrum use for multiple X-Band and S-Band frequencies and seven different orbital planes, including 45 degrees. In August 2023, the FCC granted Sidus a LizzieSat experimental launch and operating license for launch and deploy on a SpaceX Falcon 9 Transporter 10 mission. This license includes approval for orbital operations utilizing the previously approved ITU S-band and X-band frequencies and ground station coverage. We also received FCC Part 25 license approval for the LizzieSat satellite constellation missions two through five in October 2024. The National Oceanic and Atmospheric Administration (NOAA), an agency of the U.S. Department of Commerce, granted a Tier 1 license authorizing Sidus to operate LizzieSat1-3, a private remote-sensing space system comprised of three satellites (LizzieSat-1 through LizzieSat-3 or LS-1 through LS-3) in 2024. This license was updated and approved by NOAA after LizzieSat -1 launch to reflect the actual orbital data and planned altitudes for imager operations.

Previous wording

Our cost-efficient smallsats are being designed from the ground-up to optimize performance per unit cost. Our model is a movement from highly bespoke, costly satellite manufacturing techniques to standardized bus with bespoke integration of customer needs at lower costs. We are able to integrate technologies and deliver data on demand at lower costs than legacy providers due to our vertical integration, use of customer off the shelf (COTS) proven systems, cost-efficiencies, capital efficient constellation design, and adaptable pricing models.

Current wording

Our cost-efficient smallsats are being designed from the ground-up to optimize performance per unit cost. Our model is a movement from highly bespoke, costly satellite manufacturing techniques to standardized bus with integration of customer needs at lower costs. We can integrate technologies and deliver data on demand at lower costs than legacy providers due to our vertical integration, use of commercial off the shelf (COTS) proven systems, cost-efficiencies, capital efficient constellation design, and adaptable pricing models.

Previous wording

We design and manufacture our satellites at our Cape Canaveral facility. Our current configuration and facility is designed to manufacture 5-10 satellites a month. Our vertical integration enables us to control our satellites through the entire design, manufacturing, and operation process. Our years of experience manufacturing space hardware means we are able to leverage our manufacturing expertise and commercial best practices for satellite production. Additionally, leveraging both in-house and partner-provided subsystem components and in-house design and integration services, as well as operational support of satellites on orbit, to provide turn-key delivery of entire constellations offer “concept to constellation” in months instead of years. Specifically, our offerings are expected to encompass all aspects of hosted satellite and constellation services, including hosting customer payloads onto our satellites, and delivering data and constellation services to customers from our space platform. These services are expected to allow customers to focus on developing innovative payloads rather than having to design or develop complete satellite buses or satellites or constellations, which we will provide, along with ancillary services that are likely to include telemetry, tracking and control, communications, processing, as well as software development and maintenance. Our patented space-related technologies include a print head for regolith-polymer mixture and associated feedstock; a heat transfer system for regolith; a method for establishing a wastewater bioreactor environment; vertical takeoff and landing pad and interlocking pavers to construct same; and high-load vacuum chamber motion feedthrough systems and methods. Regolith is a blanket of unconsolidated, loose, heterogeneous superficial deposits covering solid rock. It includes dust, broken rocks, and other related materials and is present on earth, the moon, Mars, some asteroids, and other terrestrial planets and moons. We continue to patent our products including our satellites, external platforms and other innovations.

Current wording

We design and manufacture our satellites at our Cape Canaveral facility. Our current configuration and facility are designed to manufacture multiple satellites per month. Our vertical integration enables us to control our satellites through the entire design, manufacturing, and operation process. Our years of experience manufacturing space hardware means we can leverage our manufacturing expertise and commercial best practices for satellite production. Additionally, leveraging both in-house and partner-provided subsystem components and in-house design and integration services, as well as operational support of satellites on orbit, to provide turn-key delivery of entire constellations offer “concept to constellation” in months instead of years. Specifically, our offerings are expected to encompass all aspects of hosted satellite and constellation services, including hosting customer payloads onto our satellites, and delivering data and constellation services to customers from our space platform. These services are expected to allow customers to focus on developing innovative payloads rather than having to design or develop complete satellite buses or satellites or constellations, which we will provide, along with ancillary services that are likely to include telemetry, tracking and control, communications, processing, as well as software development and maintenance. Our patented space-related technologies include a print head for regolith-polymer mixture and associated feedstock; a heat transfer system for regolith; a method for establishing a wastewater bioreactor environment; vertical takeoff and landing pad and interlocking pavers to construct same; and high-load vacuum chamber motion feedthrough systems and methods. Regolith is a blanket of unconsolidated, loose, heterogeneous superficial deposits covering solid rock. It includes dust, broken rocks, and other related materials and is present on earth, the moon, Mars, some asteroids, and other terrestrial planets and moons. We continue to patent our products including our satellites, external platforms and other innovations.

Previous wording

We generate revenue by selling payload space on our satellite platform, providing engineering and systems integration services to strategic customers on a project-by-project basis, and manufacturing space hardware. Additionally, we intend to add to our revenue by selling geospatial data and actionable intelligence captured through our constellation. This support is typically contracted to both commercial and government customers under fixed price contracts and often includes other services. Due to the size and capacity of our satellite, we plan to host a diverse array of sensors such as Multispectral and Hyperspectral Earth Observing Imagers, Maritime Vessel RF Tracking receivers, UHF IoT Transceivers, Optical Communications gear and others on a single platform that can simultaneously address the needs of many customer requirements.

Current wording

We generate revenue by selling payload space on our satellite platform, providing engineering and systems integration services to strategic customers on a project-by-project basis, and manufacturing space hardware to include satellites. Additionally, we intend to add to our revenue by selling geospatial data and actionable intelligence captured through our constellation. This support is typically contracted to both commercial and government customers under fixed price contracts and often includes other services. Due to the size and capacity of our satellite, we plan to host a diverse array of sensors such as Multispectral and Hyperspectral Earth Observing Imagers, Maritime Vessel RF Tracking receivers, UHF IoT Transceivers, Optical Communications systems, and others on a single platform that can simultaneously address the needs of many customer requirements.

Previous wording

We are developing a manufacturing model that provides rapid response to customer requirements including integration of customers technologies and space-based data delivery. Our planned satellites are being designed to integrate COTS subsystems that are space-proven, can be rapidly integrated into the satellite and replaced rapidly when customer needs change or evolve. Our vertically integrated manufacturing processes give us the flexibility to make changes during the production cycle without impacting launch or costs.

Current wording

We have developed a manufacturing model that provides rapid response to customer requirements including integration of customers technologies and space-based data delivery. Our planned satellites are being designed to integrate COTS subsystems that are space-proven, can be rapidly integrated into the satellite and replaced rapidly when customer needs change or evolve. Our vertically integrated manufacturing processes give us the flexibility to make changes during the production cycle without impacting launch or costs.

Previous wording

While Environmental, Social and Governance (ESG) reporting is not mandatory, we are developing an ESG policy that will implement the tracking of several indicators we believe are critical to ensure we are doing our part to continue sustainable growth and maximize shareholder value. We have been in business for over ten years manufacturing space hardware and components, and in that time, implementation of policies and processes to mitigate environmental impact have been of upmost importance. Furthermore, since our inception, we have recognized the value of our employees and have always prioritized employee well-being through facets such as excellent benefits, programs, educational assistance, and insurance of a safe and healthy work environment. We also understand that our efforts to promote value and well -being are not limited to our employees. We are committed to the communities we belong to both locally and professionally. We recently started to formalize this commitment, providing tangible benefits back to the community that supports us.

Current wording

While Environmental, Social and Governance (ESG) reporting is not mandatory, we are developing an ESG policy that will implement the tracking of several indicators we believe are critical to ensure we are doing our part to continue sustainable growth and maximize shareholder value. We have been in business for over twelve years manufacturing space hardware and components, and in that time, implementation of policies and processes to mitigate environmental impact have been of upmost importance. Furthermore, since our inception, we have recognized the value of our employees and have always prioritized employee well-being through facets such as excellent benefits, programs, educational assistance, and insurance of a safe and healthy work environment. We also understand that our efforts to promote value and well -being are not limited to our employees. We are committed to the communities we belong to both locally and professionally. We recently started to formalize this commitment, providing tangible benefits back to the community that supports us.

Previous wording

Non-related party revenue decreased 29% for the 3 months ended June 30, 2024 to approximately $835,000 as compared to approximately $1.2 million for the 3 months ended June 30, 2023 and was primarily driven by timing of fixed price milestone contracts and fewer satellite related revenue contracts than prior year. Revenue from related parties decreased by 52% to approximately $93,000 for the three months ended June 30, 2024 from approximately $195,000 for the three months ended June 30, 2023. This was driven by the timing of fixed price milestone contracts and fewer contracts our related party entered into with its customers, requiring less outsourcing of its work to us.

Current wording

Non-related party revenue increased 131% for the 3 months ended September 30, 2024 to approximately $1.8 million as compared to approximately $762,000 for the 3 months ended September 30, 2023 and was primarily driven by timing of fixed price milestone contracts and increased satellite related revenue contracts as compared to prior year. Revenue from related parties decreased by 50% to approximately $112,000 for the three months ended September 30, 2024 from approximately $223,000 for the three months ended September 30, 2023. This was influenced by the timing of fixed-price milestone contracts and a reduction in the number of contracts our related party secured with its customers, leading to decreased outsourcing of work to us.

Previous wording

The increase in cost of revenue of 105% for the three months ended June 30, 2024 to approximately $1.77 million as compared to approximately $863,000 for the three months ended June 30, 2023, included approximately $46,000 and approximately $90,000, respectively, of related party costs of revenue. The overall increase in cost of revenue was driven by mix of contracts and lower sales of our higher margin satellite related business. As a manufacturing entity, materials and other direct costs are a percentage of revenue. The percent change in the cost of revenue was higher than the percent decrease in revenue due to mix of contracts, supply chain impacts, and increased depreciation expense related to our satellite side of the business.

Current wording

The increase in cost of revenue of 69% for the three months ended September 30, 2024 to approximately $1.8 million as compared to approximately $1.1 million for the three months ended September 30, 2023, included approximately $57,500 and approximately $192,000, respectively, of related party costs of revenue. The overall increase in cost of revenue was driven by a mix of contracts of varying types and increased depreciation expense in our satellite related business. As a manufacturing entity, materials and other direct costs are a percentage of revenue. The percent change in the cost of revenue was lower than the percent increase in revenue due to a mix of contracts of varying types and increased revenue from our higher margin satellite related business, offset by increased depreciation expense related to our satellite side of the business.

Previous wording

The decrease in our gross profit of approximately $2.16 million to a gross loss of approximately $757,000 for the six months ended June 30, 2024 as compared to a gross profit of approximately $1.4 million for the six months ended June 30, 2023 is primarily attributable to mix of contracts, lower sales from our satellite related business and higher supply chain related costs.

Current wording

The 140% increase in our gross profit to a gross profit of approximately $38,000 for the three months ended September 30, 2024 as compared to a gross loss of $96,281 for the three months ended September 30, 2023 is primarily attributable to a mix of contracts of varying types and increased sales in our higher margin satellite related business, offset by increased depreciation expense related to our satellite side of the business.

Previous wording

Selling, general, and administrative expenses of approximately $6.7 million were down approximately $400,000 when compared with approximately $7.1 million for the same period in 2023, and was primarily due to the following:

Current wording

Selling, general, and administrative expenses of approximately $3.2 million were down $568,391 when compared with approximately $3.8 million for the same period in 2023, and was primarily due to the following:

Previous wording

Six Months Ended June 30, 2024 compared to the Six Months Ended June 30, 2023

Current wording

Nine Months Ended September 30, 2024 compared to the Six Months Ended September 30, 2023

Previous wording

Total revenue for the six months ended June 30, 2024 decreased approximately $1.66 million versus total revenue for the six months ended June 30, 2023. Primarily a result of a change in the mix of contracts. Manufacturing non-related party revenue decreased 46% for the six months ended June 30, 2024 to approximately $1.7 million as compared to approximately $3.1 million for the six months ended June 30, 2023 and was primarily driven by the timing of fixed price milestone contracts and lower satellite related revenue. Manufacturing revenue from related parties decreased approximately 45% to approximately $298,000 for the six months ended June 30, 2024 from approximately $544,000 for the six months ended June 30, 2023 and was driven by timing of fixed price milestone contracts our related party entered into and outsourcing less of its work to us.

Current wording

Total revenue for the nine months ended September 30, 2024 decreased approximately $773,000 versus total revenue for the nine months ended September 30, 2023. This is primarily a result of a change in the mix of contracts of varying types. Manufacturing non-related party revenue decreased 11% for the nine months ended September 30, 2024 to approximately $3.8 million as compared to approximately $4.6 million for the nine months ended September 30, 2023 and was primarily driven by the timing of fixed price milestone contracts and lower satellite related revenue. Manufacturing revenue from related parties decreased approximately 47% to $409,523 for the nine months ended September 30, 2024 from $766,985 for the nine months ended September 30, 2023 and was influenced by the timing of fixed-price milestone contracts and a reduction in the number of contracts our related party secured with its customers, leading to decreased outsourcing of work to us.

Previous wording

The increased 23% in cost of revenue for the six months ended June 30, 2024 to approximately $2.7 million as compared to approximately $2.2 million for the six months ended June 30, 2023 was primarily driven by mix of contracts and a decrease in our higher margin satellite related business as well as continued increased supply chain related costs in the manufacturing side of our business. Cost of revenue from related parties for the 6 months ended June 30, 2024 versus prior year, included approximately $214,000 and approximately $387,000, respectively.

Current wording

The 38% increase in cost of revenue for the nine months ended September 30, 2024 to approximately $4.6 million as compared to approximately $3.3 million for the nine months ended September 30, 2023 was primarily driven by a mix of contracts, a decrease in our higher margin satellite related business as well as increased depreciation expense in our satellite related business. Cost of revenue from related parties for the nine months ended September 30, 2024 versus prior year, included approximately $272,000 and approximately $579,000, respectively.

Previous wording

The decrease in our gross profit of approximately $1.3 million to a gross loss of approximately $841,000 for the three months ended June 30, 2024 as compared to a gross profit of approximately $508,000 for the three months ended June 30, 2023 is primarily attributable to mix of contracts, lower sales and increased depreciation expense related to our satellite side of the business, and higher supply chain related costs.

Current wording

The decrease in our gross profit of approximately $2.0 million to a gross loss of approximately $719,000 for the nine months ended September 30, 2024 as compared to a gross profit of approximately $1.4 million for the nine months ended September 30, 2023 is primarily attributable to a mix of contracts, lower sales from our satellite related business and increased depreciation expense related to our satellite side of the business.

Previous wording

Selling, general, and administrative expenses of approximately $3.1 million were down approximately $500,000 when compared with approximately $3.6 million for the same period in 2023, and was primarily due to the following:

Current wording

Selling, general, and administrative expenses of approximately $9.9 million were down approximately $1.25 million when compared with approximately $10.9 million for the same period in 2023, and was primarily due to the following:

Previous wording

Other income and (expenses) showed a decrease of other expenses of $210,707 to $238,169 compared to $448,876 in 2023 primarily due to a change in accounting treatment of financing related costs included in other expense in 2023 to being included in the costs required to raise capital which are included in additional paid in capital on the balance sheet.

Current wording

Other income and (expenses) showed a decrease of other expenses of $233,068 to $1,217,841 compared to $1,450,909 in 2023 primarily due to a change in accounting treatment of financing related costs included in other expense in 2023 to 2024 being included in the costs required to raise capital which are included in additional paid in capital on the balance sheet, partially offset by an increase in interest expense related to our note payable and asset-based loan facility in 2024.

Previous wording

The following table reconciles adjusted EBITDA to net loss (the most comparable GAAP measure) for the six months ended June 30, 2024 and 2023:

Current wording

The following table reconciles adjusted EBITDA to net loss (the most comparable GAAP measure) for the nine months ended September 30, 2024 and 2023:

Previous wording

We had an accumulated deficit of approximately $50.8 million and working capital deficiency of approximately $432,000 as of June 30, 2024. As of June 30, 2024, we had approximately $1.4 million of cash as compared with approximately $1.2 million as of December 31,2023.

Current wording

We had an accumulated deficit of approximately $54.7 million and working capital deficiency of approximately $4.6 million as of September 30, 2024. As of September 30, 2024, and December 31, 2023, we had approximately $1.2 million of cash.

Previous wording

Current liabilities decreased by approximately $3.5 million or 29% to approximately $8.7 million as of June 30, 2024 from approximately $12.2 million December 31,2023. The decrease was primarily attributable to a decrease in accounts payable and other current liabilities and our asset-based loan liability.

Current wording

Current liabilities increased by approximately $1.6 million or 13% to approximately $13.8 million as of September 30, 2024 from approximately $12.2 million December 31,2023. The increase was primarily attributable to an increase in our asset-based loan liability.

Previous wording

For the six months ended June 30, 2024 and 2023, we did not generate positive cash flows from operating activities. For the six months ended June 30, 2024, net cash flows used in operating activities was approximately $7.6 million compared to approximately $6.1 million during the six months ended June 30, 2023.

Current wording

For the nine months ended September 30, 2024 and 2023, we did not generate positive cash flows from operating activities. For the nine months ended September 30, 2024, net cash flows used in operating activities was approximately $10.3 million compared to approximately $10.0 million during the nine months ended September 30, 2023.

Previous wording

Cash flows used in operating activities for the six months ended June 30, 2024 of approximately $7.6 million is comprised of a net loss of approximately $7.9 million, which was reduced by non-cash expenses of $160,028 for stock-based compensation and $858,033 for depreciation, and an increase in net change in working capital of approximately $642,000.

Current wording

Cash flows used in operating activities for the nine months ended September 30, 2024 of approximately $10.3 million is comprised of a net loss of approximately $11.4 million, which was reduced by non-cash expenses of $236,040 for stock-based compensation and approximately $1.5 million for depreciation, and an increase in net change in working capital of approximately $625,000.

Previous wording

Cash flows used in operating activities for the six months ended June 30, 2023 of approximately $6.1 million is comprised of a net loss of approximately $6.9 million, which was reduced by non-cash expenses of $806,754 for the issuance of warrants as compensation of underwriters services and $79,385 for depreciation, and an increase in net change in working capital of approximately $83,000.

Current wording

Cash flows used in operating activities for the nine months ended September 30, 2023 of approximately $10 million is comprised of a net loss of approximately $11.0 million, which was reduced by non-cash expenses of $845,029 for the issuance of warrants as compensation of underwriters services, $15,000 for bad debt and $148,166 for depreciation, and an decrease in net change in working capital of approximately $62,000.

Previous wording

During the six months ended June 30, 2024 and 2023, we purchased property and equipment in the amount of approximately $4.1 million and $2.6 million respectively, primarily related to purchasing satellite related components and software.

Current wording

During the nine months ended September 30, 2024 and 2023, we purchased property and equipment in the amount of approximately $5.1 million and $5.3 million respectively, primarily related to purchasing satellite related components and software.

Previous wording

During the six months ended June 30, 2024, net cash provided in financing activities of approximately $11.9 million included a January 2024, capital raise of approximately $5.6 million and a February 2024, capital raise of approximately $7.9 million partially offset by repayment of an asset-based loan of approximately $1.7 million net and repayment of notes payable of $150,000.

Current wording

During the nine months ended September 30, 2024, net cash provided in financing activities of approximately $15.4 million included a January 2024 capital raise of approximately $5.6 million, a February 2024 capital raise of approximately $7.9 million, approximately $1.8 million in net proceeds from an asset-based loan and repayment of notes payable of $150,000.

Previous wording

During the six months ended June 30, 2023, net cash provided in financing activities of approximately $14.3 million included our January and April 2023 capital raises of approximately $14.8 million net proceeds, partially offset by approximately $286,000 net repayment of an asset-based loan agreement and repayment of notes payable of approximately $180,000.

Current wording

During the nine months ended September 30, 2023, net cash provided in financing activities of approximately $14.5 million included our January and April 2023 capital raises of approximately $14.8 million net proceeds, partially offset by approximately $2,200 net repayment of an asset-based loan agreement and repayment of notes payable of approximately $224,000.

Previous wording

On March 5, 2024, we completed an underwritten public offering of 1,321,000 shares of our Class A common stock at a public offering price of $6.00 per share, for which we received approximately $7.1million of net proceeds.

Current wording

On March 5, 2024, we completed an underwritten public offering of 1,321,000 shares of our Class A common stock at a public offering price of $6.00 per share, for which we received approximately $7.1 million of net proceeds.

Previous wording

These five elements, as applied to each of our revenue category, is summarized below:

Current wording

These five elements, as applied to each of the Company’s revenue category, are summarized below:

Previous wording

Revenues from fixed price contracts that are still in progress at month end are recognized on the percentage-of-completion method, measured by the percentage of total costs incurred to date to the estimated total costs for each contract. This method is used because management considers total costs to be the best available measure of progress on these contracts. Revenue from fixed price contracts and time-and-materials contracts that are completed in the month the work was started are recognized when the work is shipped.

Current wording

Revenues from fixed price manufacturing related contracts that are still in progress at month end are recognized on the percentage-of-completion method, measured by the percentage of total costs incurred to date to the estimated total costs for each contract. This method is used because management considers total costs to be the best available measure of progress on these contracts. Revenue from fixed price contracts and time-and-materials contracts that are completed in the month the work was started are recognized when the work is shipped.

Previous wording

Revenues from fixed price contracts that require milestone payments are recognized at the time of the milestone being met. This method is used because management considers that the payments are nonrefundable unless the entity fails to perform as promised. If the customer terminates the contract, we are entitled only to retain any progress payments received from the customer and we have no further rights to compensation from the customer. Even though the payments made by the customer are nonrefundable, the cumulative amount of those payments is not expected, at all times throughout the contract, to at least correspond to the amount that would be necessary to compensate us for performance completed to date. Accordingly, we account for the progress under the contract as a performance obligation satisfied at a point in time.

Current wording

Revenues from fixed price contracts primarily related to satellite payloads that require milestone payments are recognized at the time of the milestone being met. This method is used because management considers that the payments are nonrefundable unless the entity fails to perform as promised. If the customer terminates the contract, we are entitled only to retain any progress payments received from the customer and we have no further rights to compensation from the customer. Even though the payments made by the customer are nonrefundable, the cumulative amount of those payments is not expected, at all times throughout the contract, to at least correspond to the amount that would be necessary to compensate us for performance completed to date. Accordingly, we account for the progress under the contract as a performance obligation satisfied at a point in time.

Previous wording

The provision for expected credit losses on trade receivables are estimated based on historical information, customer solvency and changes in customer payment terms and practices. The Company will calibrate its provision matrix to adjust the historical credit loss experience with forward-looking information. The amount of expected credit losses is sensitive to changes in circumstances and of forecast economic conditions. The Company’s historical credit loss experience and forecast of economic conditions may also not be representative of the customer’s actual default in the future. The company will utilize the Allowance Method based on the accounts receivable aging in order to accrue bad debt expense.

Current wording

The provision for expected credit losses on trade receivables is estimated based on historical information, customer solvency and changes in customer payment terms and practices. The Company calibrates its provision matrix to adjust the historical credit loss experience with forward-looking information. The amount of expected credit losses is sensitive to changes in circumstances and of forecast economic conditions. The Company’s historical credit loss experience and forecast of economic conditions may also not be representative of the customer’s actual default in the future. The company utilizes the Allowance Method based on the accounts receivable aging in order to accrue bad debt expense.

Previous wording

We are in the process of evaluating the benefits of relying on other exemptions and reduced reporting requirements provided by the JOBS Act. Subject to certain conditions set forth in the JOBS Act, as an “emerging growth company,” we intend to rely on certain of these exemptions, including without limitation, (i) providing an auditor’s attestation report on our system of internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act and (ii) complying with any requirement that may be adopted by the Public Company Accounting Oversight Board (“PCAOB”) regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements, known as the auditor discussion and analysis. We will remain an “emerging growth company” until the earliest of (i) the last day of the fiscal year in which we have total annual gross revenues of $1.07 billion or more; (ii) the last day of our fiscal year following the fifth anniversary of the date of the completion of this offering; (iii) the date on which we have issued more than $1 billion in nonconvertible debt during the previous three years; or (iv) the date on which we are deemed to be a large accelerated filer under the rules of the SEC.

Current wording

We are in the process of evaluating the benefits of relying on other exemptions and reduced reporting requirements provided by the JOBS Act. Subject to certain conditions set forth in the JOBS Act, as an “emerging growth company,” we intend to rely on certain of these exemptions, including without limitation, (i) providing an auditor’s attestation report on our system of internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act and (ii) complying with any requirement that may be adopted by the Public Company Accounting Oversight Board (“PCAOB”) regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements, known as the auditor discussion and analysis. We will remain an “emerging growth company” until the earliest of (i) the last day of the fiscal year in which we have total annual gross revenues of $1.07 billion or more; (ii) the last day of our fiscal year following the fifth anniversary of the date of our initial public offering; (iii) the date on which we have issued more than $1 billion in nonconvertible debt during the previous three years; or (iv) the date on which we are deemed to be a large accelerated filer under the rules of the SEC.