SKYX Platforms Corp.

Previous wording

We have a series of advanced-safe-smart platform technologies. Our first and second-generation technologies enable light fixtures, ceiling fans and other electrically wired products to be installed safely and plugged in to a ceiling’s electrical outlet box within seconds, and without the need to touch hazardous wires. The plug and play technology method is a universal power-plug device that has a matching receptacle that is simply connected to the electrical outlet box on the ceiling, enabling a safe and quick plug and play installation of light fixtures and ceiling fans in just seconds. The plug and play power-plug technology eliminates the need of touching hazardous electrical wires while installing light fixtures, ceiling fans and other hard wired electrical products. In recent years, we have expanded the capabilities of our power-plug product to include advanced-safe and quick universal installation methods, as well as advanced-smart capabilities. The smart features include control of light fixtures and ceiling fans by the SkyHome App, through WIFI, Bluetooth Low Energy and voice control. It allows scheduling, energy savings eco mode, dimming, back-up emergency light, night light, light color changing and much more. Our third-generation technology is an all-in-one safe and smart-advanced platform that is designed to enhance all-around safety and lifestyle of homes and other buildings. Our products are designed to improve all around home and building safety and lifestyle. We are continuing to refine our products and began manufacturing certain advanced and smart products in 2023 and expect additional products, including the third-generation smart-advanced platform to be available in 2024. We expect to manufacture the additional product offerings within the next six months. We hold over 97 U.S. and global patents and patent applications and have received a variety of final electrical code approvals, including UL, United Laboratories of Canada (cUL) and Conformité Européenne (CE), and 2017 and 2020 inclusion in the NEC Code Book.

Current wording

We have a series of advanced-safe-smart platform technologies. Our first and second-generation technologies enable light fixtures, ceiling fans and other electrically wired products to be installed safely and plugged in to a ceiling’s electrical outlet box within seconds, and without the need to touch hazardous wires. The plug and play technology method is a universal power-plug device that has a matching receptacle that is simply connected to the electrical outlet box on the ceiling, enabling a safe and quick plug and play installation of light fixtures and ceiling fans in just seconds. The plug and play power-plug technology eliminates the need of touching hazardous electrical wires while installing light fixtures, ceiling fans and other hard wired electrical products. In recent years, we have expanded the capabilities of our power-plug product to include advanced, safe and quick universal installation methods, as well as advanced-smart capabilities. The smart features include control of light fixtures and ceiling fans by the SkyHome App, through WIFI, Bluetooth Low Energy and voice control connections. The SkyHome App allows scheduling, energy saving-eco mode, dimming, back-up emergency light, night light, light color changing and much more. Our third-generation technology is an all-in-one safe and smart-advanced platform (the “Smart Sky Platform”) that is designed to enhance all-around safety and lifestyle of homes and other buildings. We are continuing to refine our products and began manufacturing certain advanced and smart products in 2023 and expect additional products, including the third-generation smart-advanced platform to be available in 2025. Our products are designed to improve all around home and building safety and lifestyle. We expect to manufacture the additional product offerings within the next six months. We hold over 97 U.S. and global patents and patent applications and have received a variety of final electrical code approvals, including UL, United Laboratories of Canada (cUL) and Conformité Européenne (CE), and 2017 and 2020 inclusion in the NEC Code Book.

Previous wording

Inflation and related risk of recession increased during 2022 and have continued to impact operations during 2023 and 2024. Inflationary factors, such as increases in interest rates, supply and overhead costs and transportation costs, may adversely affect our operating results, and we may not be able to offset increased costs with increased sales price per unit, particularly as we work toward commercial manufacturing of our products. Although we do not believe that inflation has had a material impact on our financial position or results of operations to date, we may experience some effect in the near future (especially if inflation rates continue to rise). In addition, we may be negatively impacted because of supply chain constraints, consequences associated with government regulations, ongoing and potential geopolitical conflicts, instability in the global banking system, employee availability and wage increases.

Current wording

Inflation and related risk of recession increased during 2022 and have continued to impact operations. Inflationary factors, such as tariffs, increases in interest rates, supply and overhead costs and transportation costs, may adversely affect our operating results, and we may not be able to offset increased costs with increased sales price per unit, particularly as we work toward commercial manufacturing of our products. Although we do not believe that inflation has had a material impact on our financial position or results of operations to date, we may experience some effect in the near future (especially if inflation rates continue to rise). In addition, we may be negatively impacted because of supply chain constraints, consequences associated with government regulations, ongoing and potential geopolitical conflicts, instability in the global banking system, employee availability and wage increases. We are currently evaluating, and do not yet know, the potential impact of recently increased tariffs to our business and financial condition.

Previous wording

The Israel-Hamas-Lebanon war may adversely impact our operations in the near future. We have a number of developers working in Israel. If such individuals are called for service or this war escalates regionally, it may create work interruptions leading to longer periods between releases of offering improvements and increased costs.

Current wording

The conflicts in the Middle East may adversely impact our operations in the near future. We have a number of developers working in Israel. If such individuals are called for service or this conflict escalates regionally, it may create work interruptions leading to longer periods between releases of offering improvements and increased costs.

Previous wording

During April 2023, we completed the previously announced acquisition of all the issued and outstanding shares of Belami, a strategic e-commerce lighting and home décor conglomerate. The Company paid cash and issued an aggregate of 3,776,706 shares of our common stock as consideration for the acquisition. The Company expects that Belami will serve as a marketing and growth platform and should provide several distribution channels for our products, including to retail customers, builders, and professionals.

Current wording

During April 2023, we completed the previously announced acquisition of all the issued and outstanding shares of Belami, a strategic e-commerce lighting and home décor conglomerate. The Company paid cash and issued an aggregate of 3,776,706 shares of our common stock as consideration for the acquisition. The Company expects that Belami will serve as a marketing and growth platform and should provide several distribution channels for our products, including retail customers, builders, and professionals.

Previous wording

During October 2024, the Company completed its authorization of the issuance of 440,000 shares each of newly authorized Series A Preferred Stock and Series A-1 Preferred Stock which generated proceeds of $11.0 million.

Current wording

Between October 2024 and March 2025, the Company issued shares of newly authorized Series A Preferred Stock and Series A-1 Preferred Stock which generated proceeds of $12.0 million.

Previous wording

Comparison of the Three and Nine months Ended September 30, 2024, and 2023

Current wording

Comparison of the Three months ended March 31, 2025

Previous wording

We believe that revenues will be higher in 2024 than in 2023, primarily resulting from revenues from Belami, which was acquired in April 2023 and the sale of our advanced and smart products. We believe that our revenues will be higher in 2025 than in 2024 primarily resulting from revenues from the sale of our advanced and smart products.

Current wording

We believe that our revenues will be higher in 2025 than in 2024 primarily resulting from revenues from the sale of our advanced and smart products.

Previous wording

Sales and marketing expenses consist primarily of sales and marketing compensation as well as sales and marketing programs.

Current wording

Selling and marketing expenses consist primarily of sales and marketing compensation as well as sales and marketing programs.

Previous wording

The increase in interest expense during the interim 2024 periods resulted primarily from interest charges related to increased interest-bearing weighted average debt in the current periods when compared to the prior year periods.

Current wording

The increase in interest expense resulted primarily from interest charges related to increased interest-bearing weighted average debt in the current periods when compared to the prior year periods.

Previous wording

As of September 30, 2024, and 2023, we had $13.0 million and $22.1 million in cash, cash equivalents, and restricted cash, respectively.

Current wording

As of March 31, 2025, and 2024, we had $12.3 million and $15.5 million in cash, cash equivalents, and restricted cash, respectively.

Previous wording

We have raised additional funds through the sale of our common stock for gross proceeds of $4.4 million pursuant to placements and offerings during the nine-month period ended September 30, 2024.

Current wording

We have raised additional funds through the sale of our common stock for gross proceeds of $ 460,000 pursuant to placements and offerings during the three-month period ended March 31, 2025. We also generated gross proceeds of $1.0 million pursuant to the issuance of 40,000 shares of our Series A-1 Preferred Stock in March 2025.

Previous wording

These offerings included shares sold pursuant to our ATM offering program which provides us with additional access to capital, as needed, subject to market conditions. During the three months ended September 30, 2024, we did not issue any shares of common stock under such program. From inception through September 30, 2024, we issued 7,894,899 shares of common stock under such a program for net proceeds of $13,795,059, net of brokerage fees and legal fees of $619,415. As of September 30, 2024, the remaining amount to be used under the ATM offering program is $5.9 million.

Current wording

These offerings included shares sold pursuant to our ATM offering program which provides us with additional access to capital, as needed, subject to market conditions. During the three months ended March 31, 2025, we issued 223,756 shares of common stock under such program for net proceeds of $450,428, excluding placement fees of $9,206. From inception through March 31, 2025, we issued 8,118,655 shares of common stock under such a program for net proceeds of $14,706,702, net of brokerage fees and legal fees of $ 628,621. As of March 31, 2025, the remaining amount to be used under the ATM offering program is $5.3 million.

Previous wording

On October 4, 2024, we sold an aggregate of 440,000 shares of two series of preferred stock, resulting in total gross proceeds of $11.0 million, pursuant to (i) a Securities Purchase Agreement entered into with an accredited investor, pursuant to which such investor purchased an aggregate of 200,000 shares of Series A Preferred Stock, at a purchase price of $25.00 per share, and (ii) a Securities Purchase Agreement entered into with certain accredited investors, pursuant to which such investors purchased an aggregate of 240,000 shares of Series A-1 Preferred Stock, at a purchase price of $25.00 per share.

Current wording

Between October, 2024 and March 2025, we sold an aggregate of 480,000 shares of two series of preferred stock, resulting in total gross proceeds of $12.0 million, pursuant to securities purchase agreements under which an investor purchased an aggregate of 200,000 shares of Series A Preferred Stock, at a purchase price of $25 per share, and securities purchase agreements under which certain investors purchased an aggregate of 280,000 shares of Series A-1 Preferred Stock, at a purchase price of $25 per share.

Previous wording

We owe approximately $15.6 million under fixed rate obligations as of September 30, 2024. In addition, we owe GE certain minimum royalty payments under a license agreement and other accrued expenses which amounted to $2.3 million as of September 30, 2024.

Current wording

We owe approximately $20.0 million under fixed rate obligations as of March 31, 2025. In addition, we owe GE certain minimum royalty payments under a license agreement and other accrued expenses which amounted to $1.7 million as of March 31, 2025.

Previous wording

As common with companies having a similar cash conversion cycle as ours, when sales are converted into cash rapidly, often referred to as the “Dell Working Capital Model,” we leverage our trades payable to finance our operations to lower our cost of capital, and accordingly, we may have negative working capital. This negative working capital is partly inherent to the relatively quick turnaround of finished goods inventory, quicker collection of accounts receivables, and longer payment cycle of trades payable. Our accounts receivable, inventory, net of trades payable, amounted to $(7.5) million and $(7.2) million as of September 30, 2024, and 2023, respectively.

Current wording

As common with companies having a similar cash conversion cycle as ours, when sales are converted into cash rapidly, often referred to as the “Dell Working Capital Model,” we leverage our trades payable to finance our operations to lower our cost of capital, and accordingly, we may have negative working capital. This negative working capital is partly inherent to the relatively quick turnaround of finished goods inventory, quicker collection of accounts receivables, and longer payment cycle of trades payable. Our negative working capital, which consists of accounts receivable, inventory, net of trades and compensation payable, amounted to $8.5 million and $7.2 million as of March 31, 2025, and 2024 respectively.

Previous wording

Please see below a summary of the primary components of our cash used in or provided by operating investing and financing activities during the nine-month period ended September 30, 2024

Current wording

Please see below a summary of the primary components of our cash used in or provided by operating investing and financing activities during the three-month period ended March 31, 2025:

Previous wording

The Company’s liquidity sources include $ 13.0 million in cash, cash equivalents and restricted cash, and $ 11.7 million of working capital deficit as of September 30, 2024. The Company has a history of recurring operating losses and its net cash used in operating activities amounted to $13.0 million and $10.1 million during the nine months ended September 30, 2024, and 2023, respectively. The Company has also generated net cash provided by financing activities of $4.1 million and $19.6 million during the nine months ended September 30, 2024 and 2023, respectively. Accordingly, the Company’s management cannot ascertain that there is no substantial doubt that it will be able to meet its obligations as they become due within one year after the date that its financial statements are issued.

Current wording

The Company’s liquidity sources include $ 12.3 million in cash and cash equivalents, including restricted cash of $2.8 million held for long-term purposes, and $ 10.3 million of working capital deficit as of March 31, 2025. The Company has a history of recurring operating losses, and its net cash used in operating activities amounted to $4.3 million and $6.2 million during the three months ended March 31, 2025, and 2024, respectively. The Company has also generated net cash provided by financing activities of $1.5 million and $3.6 million during the three months ended March 31, 2025, and 2024, respectively. Accordingly, the Company’s management cannot ascertain that there is no substantial doubt that it will be able to meet its obligations as they become due within one year after the date that its financial statements are issued.

Previous wording

Management intends to mitigate such conditions by supporting its continued growth, decreasing its cash used in operating activities through increased revenues and increased margins from products sold to large retailers and its internet portals, and to the extent necessary, generate cash provided by financing activities through its at the market offering or other equity or debt financing means.

Current wording

Management intends to mitigate such conditions by supporting its continued growth, decreasing its cash used in operating activities through increased revenues and increased margins from products sold to large retailers and its internet portals, and to the extent necessary, generating cash provided by financing activities through at the market offering or other equity or debt financing means.

Previous wording

Our significant accounting policies are disclosed in Note 2 to our consolidated financial statements for the year ended December 31, 2023 contained in our Annual Report on Form 10-K for the year ended December 31, 2023. The following is a summary of those accounting policies that involve significant estimates and judgment of management.

Current wording

Our significant accounting policies are disclosed in Note 2 to our consolidated financial statements for the year ended December 31, 2024 contained in our Annual Report on Form 10-K. The following is a summary of those accounting policies that involve significant estimates and judgment of management.