Building a jetpack: JetPack Aviation Annual Report 2017
Jetpack Aviation has been developing jetpacks since 1985. A couple of years ago, they came out of the "underground" and now you can "peep" for their achievements not only engineering, but also organizational.
Annual report
')
14218 Aetna Street, Van Nuys, CA. 91401
www.jetpackaviation.com
April 28, 2017
Jetpack Aviation Corporation (“JPA”) was founded in Delaware on September 14, 2016 to complete funding and launch the world's first portable turbojet jetpack, model JB10.
The first launch took place in November 2015 (model JB-9). The current version of the JB10 is the result of over forty years of testing and development by two leading experts in the field of rocket packs and jetpacks. Featuring a high level of controllability and the possibility of vertical take-off and landing, the JB10 is the last word of world-class technology, a completely new word in the aviation world, and besides, it is compact enough to be carried by one person or transported in a car trunk. Thus, its transportation and preparation for launch do not pose any difficulties. The JB10 is fueled with kerosene or diesel fuel, which are both affordable and expensive, reaching speeds of up to 68 miles per hour (110 km per hour) and theoretically could reach a height of 6.5 thousand feet (1981 m). It is assumed that subsequent models of jetpack will be able to develop greater speed.
Our team has been working with the US Federal Aviation Administration (FFA) for a long time to develop and certify parts and systems new to the aerospace industry. Our two founders are the most experienced experts in the field of vertical take-off and landing in the world. Nelson Tyler and David Mayman are two of those 14 people who flew with a rocket pack who used hydrogen peroxide as a fuel and could get up in the air for 30 seconds. Tyler developed the first civilian rocket pack and tested it in the 1970s. It was on it that Bill Suitor flew at the opening ceremony of the Olympic Games in 1984 in Los Angeles in front of a two million public.
The most significant opportunities for commercial use of a jetpack and other aircraft developed with vertical takeoff and landing include using it for entertainment purposes, for the needs of private and state-owned companies, for military purposes and for piloting performances.
To create the JB10 it took years of development, testing and development again. Jetpack in its essence should be very light and compact, well controlled and stable in all three axes of movement. Engines must be small, light, powerful and reliable. JPA has experienced many engine types over the years, and the results have varied greatly.
We have always strived to create the lightest and most compact jetpack as possible. As a result, we stopped at a double turbojet engines for JB10. The engines are manufactured by a European company specializing in the engine-building industry, but for their use in the JB10 jetpack, we have made many modifications to the standard engine model and control devices. With this company, we specifically concluded a two-year exclusive contract for the supply of engines, which prohibits it from selling engines to other individuals or legal entities intending to use them to create individual aircraft with vertical takeoff and landing (GDP, VTOL ). The contract may be extended if we continue to order engines in the future and show ourselves as a meaningful customer.
We also own the authorship of some specific engine modifications, thanks to which they can be used in the jetpack. In developing the hull of an aircraft, Mr. Tyler’s experience with jetpacks was used in terms of engine size, weight and shape, as well as engine control and operation systems. If we make a comparison, the rocket pack itself is very simple: it catalyzes hydrogen peroxide supplied under pressure to the silver screen of the catalyst. No electronics. The disadvantage is the extremely short flight time - the world record is about 30 seconds. But because of the JB-10 jet engines, a complex system of starting and cooling the engine, controlling the fuel supply and collecting operational information is required to display the pilot. All our technologies have been developed by us and are the property of the Company.
Most of our initial tests were carried out in Van Nice (California) - including bench tests of engines and the first flights with safety cables.
JPA aims to be at the forefront of individual GDP-aviation and is already working on alternatives with electric motors.
Currently, we are still leading in our field and believe that we do not have an equal rival, but other entertainment vehicle manufacturers or aviation companies like light aircraft manufacturers can copy the JB10 device or use reverse engineering to create a similar JB10 devices in size and capacity, but only if no intellectual property rights are affected. Potential competitors include: Martin Aircraft Company, Ehang (personal passenger drones), DJI manufacturer drones, Kitfox Aircraft, Acro Sport, Inc., Glasair Aviation, Lancair International Inc, AeroMobil and Chinese AVIC.
For those applications for which our jetpack claims, other equipment can be developed. For example, large autonomous drones or autonomous mini-helicopters can be used for search and rescue, surveillance and evacuation of personnel. Currently, we also have no competitors in the field of individual aviation for entertainment. Ultra light helicopters and airplanes have been available on the market for some time, but not a single company or person has developed or sold a turbojack. The company Martin Aircraft Company from New Zealand is developing a single-engine aircraft on gasoline with a channel fan, which is positioned as a jetpack. It is very different in design from our jetpack - it does not have turbojet engines and it is too large and heavy for one person to carry. Despite the foregoing, Martin Aircraft may delay some of our potential customers and thus compete with our products.
The company has no employees other than its director, as of today.
David Mayman. Sole Director, Chief Executive Officer, Treasurer, Secretary
The company does not participate in any legal proceedings, and, in our opinion, this is not expected.
Jetpack Aviation Ltd, registered in Hong Kong and our 100% subsidiary, owns intellectual property rights relating to the development of a jetpack. The company is currently awaiting a decision on 25 patent applications in the United States and the World Intellectual Property Organization.
In addition to ordinary credit card debts, which are reflected in our financial report in the section “Accounts payable and accruals”, the company has no debt obligations.
In the period from January 1, 2017 to April 27, 2017, we sold about 31 thousand ordinary shares in accordance with the regulations of the crowdfunding (in the USA - Regulation CF) and used the funds obtained for the development and development of the company.
In December 2016, we gave the right (warrant) to the consultant to purchase 100 thousand ordinary shares with a sale price of $ 0.01 per share in exchange for the provision of certain services to us. The right can be realized in equal monthly installments for 18 months.
In October 2016, we issued 1508 ordinary shares in accordance with the legal norms D of the US Securities Act at a price of $ 6.63 per share. The funds received were used as working capital.
In September 2016, we issued a warrant to purchase 1,37278 ordinary shares at a price of $ 5 per share in exchange for important services provided to our subsidiary. Warrant complies with the US S Securities Act.
In September 2016, we issued 8135 thousand ordinary shares in accordance with the rules S of the US Securities Act in exchange for Jetpack Aviation Ltd. shares.
In September 2016, we issued 1,66020 ordinary shares in exchange for important services provided to us. Shares were issued in accordance with Section 4 (a) (2) of the United States Securities Act.
Investing in our stocks involves a high degree of risk and uncertainty. You should carefully analyze the factors listed below, as well as the other information in this prospectus, before following it and buying our shares. If one or more of the possible events considered as unfavorable occur, then the results of our operating and financial activities will suffer, and the price of our shares may fall, and you may lose some or all of your investments. The following is a description of our vision of the main threats and material risks for our business and investment in our securities.
Our short history of operations makes it difficult to evaluate our business and its prospects and can increase the riskiness of your investments. We were established in September 2016 (our Hong Kong office was established in May 2015), and we have not yet begun production or supply of our first jetpacks. We currently have limited incomes. Our jetpack requires significant investments in commercial promotion and, perhaps, a successful model will never be developed, or it will not be sold successfully.
The development, production, sales and service of the jetpack are a capital-intensive enterprise. According to our estimates, we will need to raise an additional about $ 10 million to enter the stage of commercial production. We will need to attract additional funds by issuing shares and other debt obligations or obtain a loan from the state or a private company. The funds will be used to finance current activities, continue research, develop, form a marketing team, improve infrastructure, and acquire the necessary tools and equipment for the commercial promotion of our jetpack. It cannot be said with confidence that the funds for these purposes will be sufficient, that they will be timely or received under suitable conditions. All this calls into question the existence of our enterprise in a year, starting from the date of the report, without obtaining additional funding. The exact amount of funds or the time they are received cannot be determined at present, since it depends on a number of conditions, including market demand for our products, work on its technological level, working and administrative resources, on regular receipt of funds to pay for various services.
We are not sure whether our income will cover expenses so that we can continue our work further. If we are unable to significantly increase our profits, reduce costs, or receive additional sources of income, we will have to resort to raising funds.
We will most likely have to resort to issuing shares, including preferred ones, or debt obligations in the future. Your rights and value expressed in the shares may be reduced. An increase in debt obligations may adversely affect the operating results. Preferred shares can sometimes be issued under the conditions necessary to raise capital. These conditions may be more profitable than in the case of ordinary shares. They may differ from those on which you made your investment. Ordinary shares can be sold at current market prices, which can also affect the value of your assets.
The task of commercial production is complicated by a number of difficulties. We still do not have the final commercially successful development, streamlined production. Large funds will be required for the development and production of jetpacks. In addition, it will take a long time from design and development to launching a jetpack to the market, a high level of technical competence is required, there is currently no regulatory legislation, we need to designate the brand name and logo and identify sales and technical service centers. To succeed, we need to overcome these difficulties, along with production and legislative obstacles.
Our jetpack must comply with many government standards and regulations, including vehicle safety, fuel consumption, emission control, and noise levels. In addition, production must comply with stringent regulations governing air and water pollution, as well as the management and disposal of hazardous substances. Compliance with all these requirements may delay the start-up of production, which will affect our enterprise and financial solvency.
Damage or loss of our prototypes can be a very costly event and for a long time delay the start of the commercial implementation of our technologies.
We are very dependent on suppliers of technical components for the production of our jetpack. It is assumed that our suppliers (including future ones) can provide our needs for details that will increase at the start of production. Otherwise, we will have to look for alternative suppliers, which may adversely affect our prospects.
There is a risk that we may be blamed for the fact that our jetpack or its parts violate the intellectual property rights (and patents) of third parties. All technology companies are initially exposed to this risk. The idea of ​​creating a "jetpack" has existed for about 70 years, so it is impossible to patent the concept of "jetpack." However, it is possible to patent specific technologies that allowed us for the first time to bring the concept to life. Our patent attorneys believe that by continuing the Company's current policy in this area, we will be able to provide substantial and reliable protection not only for the JB10 model, but also for subsequent improvements and modifications.
We are not sure about the demand for our jetpacks at the moment. This is a new area, our Jetpack is a dangerous technique. Lack of demand can adversely affect our business outlook, operations and financial condition. From the very beginning, we are aiming at various market, including military and defense, niches, search and rescue activities, entertainment (air shows, sports and entertainment events), and commercial (security, intelligence, fast transport). Demand in these areas is uncertain. As a start-up company, we don’t have the financial resources of major aircraft manufacturing companies to counter market changes and demand disruptions for our products.
Our success depends heavily on David Meiman, founder and chief director, and Nelson Tyler, who both played key roles in the design and development of our product. Lord Mayman and Tyler are the driving forces behind the development of our jetpack and company. Depriving them of participation will have a negative material effect on our business. We have no alternatives to these key figures - the respected Mayman or Tyler.
Our business introduces a completely new type of aircraft. It is in its infancy, and as always in such situations there is a risk of a fall or accident. Such an incident can greatly affect our reputation, our future plans and our further development.
We may have to take a loan from financial institutions. Typical debt agreements may contain stringent requirements that may affect our operational flexibility. Failure to make payments on a debt obligation may entail a court order, which will have a material negative effect on our business, on the results of operating activities or on financial condition.
The only director and majority shareholder of the company is David Meiman. Investors will not be able to influence the management of the company.
Certain provisions of the Securities Act must be observed before selling, transferring, converting or other actions with our ordinary shares. For them, there is no public market and is not expected in the future.
Any assumptions about our financial success are hypothetical and are based on management estimates of the best operating results of our operations and have not been revised by our independent accountants. These assumptions are based on certain assumptions that management believes are reasonable. Some of them may not occur regardless of management actions. Therefore, the real results of the company will differ from the forecasts, and these differences may be material in nature. There are no guarantees on the project results.
The company has never previously violated the requirements of crowdfunding.
We are considered a company at the initial stage of development, because most of our work consists in establishing our business, and the main planned actions have not started. Our operations start in September 2016 (our Hong Kong unit - May 2015), and we are still working on our pre-sales prototype of the JB10 jetpack.
Our financial statements are presented in Appendix A, which is combined with the accounts of our Hong Kong office. Consolidated financial statements include the results of the Hong Kong office's operations through September 14, 2016, our registration dates.
In 2017, we sold one jetpack for $ 255 thousand, but then we don’t plan to sell jetpacks before we complete the development of our jetpack and start working on pre-orders and advance payments, which we believe will not happen at least until 2018. According to our forecasts, we can conduct our activities until February 2018 without generating income.
At the end of 2015 and 2016, our operating costs were $ 2,941,112 and $ 5,057,666, respectively, and our consolidated net losses amounted to $ 2,941,112 and $ 5,01,016, respectively.
As of the end of 2015 and 2016, our cash was $ 44,571 and $ 2,13160, respectively. To this day, we have financed our activities mainly with proceeds from the main shareholders of the company, funds attracted to our division and placement of securities. We received 225 thousand US dollars from the sale of one of our jetpacks, and as of April 27, 2017, we received about 200 thousand US dollars from the sale of ordinary shares.
In the future we will have to attract substantial additional capital. According to our forecasts, we will need to raise an additional $ 10 million to complete the development of a pre-sales prototype, to adjust production facilities, start production and begin to fulfill orders for our jetpacks.
We continue to work with the US Army, we need working capital to fulfill our obligations. In particular, it is required for the development of a safety parachute and engine control system. Moreover, additional capital is required for the successful development of models JB11 and JB12. The company continues to work with potential sponsors to create a jetpack aerobatic team.
The company plans to invest in the further development of the JB10 jetpack and our additional line of jetpacks. In particular, this implies the continuation of development of a parachute system, a multi-engine version of a jetpack, a training simulator and a training power pack with a power supply system in accordance with the Research and Development Agreement with the General Directorate of Special Forces of the US Department of Defense
The company is currently focused on the following R & D:
Security system: jetpacks operate at a height of from 0 to 10 thousand feet (3048 m), but most of the flights will take place at a low altitude, most likely up to several hundred feet. Therefore, it is extremely important to develop a system that ensures the safety of the pilot in the event of engine failure or damage to the aircraft. This is the only R & D we are working on. It is associated with a large number of risks and extensive testing work. Today it is difficult to determine exactly how much money is required for it, but according to our estimates it is about 200-300 thousand US dollars.
We are committed to the following major achievements:
The company has trained three pilots and has prepared a training program that is suitable for people who do not have flight experience and allows them to be trained in 2-3 weeks.
We are currently looking for several additional training and testing sites in southern California.
[The following is detailed financial information, for those who wish, you can find it here ]
Translation: Sergey Danshin
You can follow how we are doing the first Russian turbojet of vertical take-off here:
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- letters to write here alexey.stacenko@gmail.com
Jetpack Aviation Corporation
Annual report
')
14218 Aetna Street, Van Nuys, CA. 91401
www.jetpackaviation.com
April 28, 2017
Business
Corporate and general overview
Jetpack Aviation Corporation (“JPA”) was founded in Delaware on September 14, 2016 to complete funding and launch the world's first portable turbojet jetpack, model JB10.
The first launch took place in November 2015 (model JB-9). The current version of the JB10 is the result of over forty years of testing and development by two leading experts in the field of rocket packs and jetpacks. Featuring a high level of controllability and the possibility of vertical take-off and landing, the JB10 is the last word of world-class technology, a completely new word in the aviation world, and besides, it is compact enough to be carried by one person or transported in a car trunk. Thus, its transportation and preparation for launch do not pose any difficulties. The JB10 is fueled with kerosene or diesel fuel, which are both affordable and expensive, reaching speeds of up to 68 miles per hour (110 km per hour) and theoretically could reach a height of 6.5 thousand feet (1981 m). It is assumed that subsequent models of jetpack will be able to develop greater speed.
Our team has been working with the US Federal Aviation Administration (FFA) for a long time to develop and certify parts and systems new to the aerospace industry. Our two founders are the most experienced experts in the field of vertical take-off and landing in the world. Nelson Tyler and David Mayman are two of those 14 people who flew with a rocket pack who used hydrogen peroxide as a fuel and could get up in the air for 30 seconds. Tyler developed the first civilian rocket pack and tested it in the 1970s. It was on it that Bill Suitor flew at the opening ceremony of the Olympic Games in 1984 in Los Angeles in front of a two million public.
The most significant opportunities for commercial use of a jetpack and other aircraft developed with vertical takeoff and landing include using it for entertainment purposes, for the needs of private and state-owned companies, for military purposes and for piloting performances.
History of creation
To create the JB10 it took years of development, testing and development again. Jetpack in its essence should be very light and compact, well controlled and stable in all three axes of movement. Engines must be small, light, powerful and reliable. JPA has experienced many engine types over the years, and the results have varied greatly.
We have always strived to create the lightest and most compact jetpack as possible. As a result, we stopped at a double turbojet engines for JB10. The engines are manufactured by a European company specializing in the engine-building industry, but for their use in the JB10 jetpack, we have made many modifications to the standard engine model and control devices. With this company, we specifically concluded a two-year exclusive contract for the supply of engines, which prohibits it from selling engines to other individuals or legal entities intending to use them to create individual aircraft with vertical takeoff and landing (GDP, VTOL ). The contract may be extended if we continue to order engines in the future and show ourselves as a meaningful customer.
We also own the authorship of some specific engine modifications, thanks to which they can be used in the jetpack. In developing the hull of an aircraft, Mr. Tyler’s experience with jetpacks was used in terms of engine size, weight and shape, as well as engine control and operation systems. If we make a comparison, the rocket pack itself is very simple: it catalyzes hydrogen peroxide supplied under pressure to the silver screen of the catalyst. No electronics. The disadvantage is the extremely short flight time - the world record is about 30 seconds. But because of the JB-10 jet engines, a complex system of starting and cooling the engine, controlling the fuel supply and collecting operational information is required to display the pilot. All our technologies have been developed by us and are the property of the Company.
Most of our initial tests were carried out in Van Nice (California) - including bench tests of engines and the first flights with safety cables.
JPA aims to be at the forefront of individual GDP-aviation and is already working on alternatives with electric motors.
Competition
Currently, we are still leading in our field and believe that we do not have an equal rival, but other entertainment vehicle manufacturers or aviation companies like light aircraft manufacturers can copy the JB10 device or use reverse engineering to create a similar JB10 devices in size and capacity, but only if no intellectual property rights are affected. Potential competitors include: Martin Aircraft Company, Ehang (personal passenger drones), DJI manufacturer drones, Kitfox Aircraft, Acro Sport, Inc., Glasair Aviation, Lancair International Inc, AeroMobil and Chinese AVIC.
For those applications for which our jetpack claims, other equipment can be developed. For example, large autonomous drones or autonomous mini-helicopters can be used for search and rescue, surveillance and evacuation of personnel. Currently, we also have no competitors in the field of individual aviation for entertainment. Ultra light helicopters and airplanes have been available on the market for some time, but not a single company or person has developed or sold a turbojack. The company Martin Aircraft Company from New Zealand is developing a single-engine aircraft on gasoline with a channel fan, which is positioned as a jetpack. It is very different in design from our jetpack - it does not have turbojet engines and it is too large and heavy for one person to carry. Despite the foregoing, Martin Aircraft may delay some of our potential customers and thus compete with our products.
Employees
The company has no employees other than its director, as of today.
David Mayman. Sole Director, Chief Executive Officer, Treasurer, Secretary
Litigation
The company does not participate in any legal proceedings, and, in our opinion, this is not expected.
Intellectual property
Jetpack Aviation Ltd, registered in Hong Kong and our 100% subsidiary, owns intellectual property rights relating to the development of a jetpack. The company is currently awaiting a decision on 25 patent applications in the United States and the World Intellectual Property Organization.
Debt
In addition to ordinary credit card debts, which are reflected in our financial report in the section “Accounts payable and accruals”, the company has no debt obligations.
Previous stock issues
In the period from January 1, 2017 to April 27, 2017, we sold about 31 thousand ordinary shares in accordance with the regulations of the crowdfunding (in the USA - Regulation CF) and used the funds obtained for the development and development of the company.
In December 2016, we gave the right (warrant) to the consultant to purchase 100 thousand ordinary shares with a sale price of $ 0.01 per share in exchange for the provision of certain services to us. The right can be realized in equal monthly installments for 18 months.
In October 2016, we issued 1508 ordinary shares in accordance with the legal norms D of the US Securities Act at a price of $ 6.63 per share. The funds received were used as working capital.
In September 2016, we issued a warrant to purchase 1,37278 ordinary shares at a price of $ 5 per share in exchange for important services provided to our subsidiary. Warrant complies with the US S Securities Act.
In September 2016, we issued 8135 thousand ordinary shares in accordance with the rules S of the US Securities Act in exchange for Jetpack Aviation Ltd. shares.
In September 2016, we issued 1,66020 ordinary shares in exchange for important services provided to us. Shares were issued in accordance with Section 4 (a) (2) of the United States Securities Act.
Risks
Investing in our stocks involves a high degree of risk and uncertainty. You should carefully analyze the factors listed below, as well as the other information in this prospectus, before following it and buying our shares. If one or more of the possible events considered as unfavorable occur, then the results of our operating and financial activities will suffer, and the price of our shares may fall, and you may lose some or all of your investments. The following is a description of our vision of the main threats and material risks for our business and investment in our securities.
We have a short history of operations and we are not generating any profit yet.
Our short history of operations makes it difficult to evaluate our business and its prospects and can increase the riskiness of your investments. We were established in September 2016 (our Hong Kong office was established in May 2015), and we have not yet begun production or supply of our first jetpacks. We currently have limited incomes. Our jetpack requires significant investments in commercial promotion and, perhaps, a successful model will never be developed, or it will not be sold successfully.
We may not be able to obtain the necessary funding to continue our activities.
The development, production, sales and service of the jetpack are a capital-intensive enterprise. According to our estimates, we will need to raise an additional about $ 10 million to enter the stage of commercial production. We will need to attract additional funds by issuing shares and other debt obligations or obtain a loan from the state or a private company. The funds will be used to finance current activities, continue research, develop, form a marketing team, improve infrastructure, and acquire the necessary tools and equipment for the commercial promotion of our jetpack. It cannot be said with confidence that the funds for these purposes will be sufficient, that they will be timely or received under suitable conditions. All this calls into question the existence of our enterprise in a year, starting from the date of the report, without obtaining additional funding. The exact amount of funds or the time they are received cannot be determined at present, since it depends on a number of conditions, including market demand for our products, work on its technological level, working and administrative resources, on regular receipt of funds to pay for various services.
We are not sure whether our income will cover expenses so that we can continue our work further. If we are unable to significantly increase our profits, reduce costs, or receive additional sources of income, we will have to resort to raising funds.
Funding conditions can greatly affect your investment.
We will most likely have to resort to issuing shares, including preferred ones, or debt obligations in the future. Your rights and value expressed in the shares may be reduced. An increase in debt obligations may adversely affect the operating results. Preferred shares can sometimes be issued under the conditions necessary to raise capital. These conditions may be more profitable than in the case of ordinary shares. They may differ from those on which you made your investment. Ordinary shares can be sold at current market prices, which can also affect the value of your assets.
The task of producing a jetpack is complicated by a number of difficulties that can adversely affect our enterprise if we cannot overcome them.
The task of commercial production is complicated by a number of difficulties. We still do not have the final commercially successful development, streamlined production. Large funds will be required for the development and production of jetpacks. In addition, it will take a long time from design and development to launching a jetpack to the market, a high level of technical competence is required, there is currently no regulatory legislation, we need to designate the brand name and logo and identify sales and technical service centers. To succeed, we need to overcome these difficulties, along with production and legislative obstacles.
We are faced with a number of legislative obstacles.
Our jetpack must comply with many government standards and regulations, including vehicle safety, fuel consumption, emission control, and noise levels. In addition, production must comply with stringent regulations governing air and water pollution, as well as the management and disposal of hazardous substances. Compliance with all these requirements may delay the start-up of production, which will affect our enterprise and financial solvency.
Loss or damage to prototypes
Damage or loss of our prototypes can be a very costly event and for a long time delay the start of the commercial implementation of our technologies.
Parts supply
We are very dependent on suppliers of technical components for the production of our jetpack. It is assumed that our suppliers (including future ones) can provide our needs for details that will increase at the start of production. Otherwise, we will have to look for alternative suppliers, which may adversely affect our prospects.
Intellectual property
There is a risk that we may be blamed for the fact that our jetpack or its parts violate the intellectual property rights (and patents) of third parties. All technology companies are initially exposed to this risk. The idea of ​​creating a "jetpack" has existed for about 70 years, so it is impossible to patent the concept of "jetpack." However, it is possible to patent specific technologies that allowed us for the first time to bring the concept to life. Our patent attorneys believe that by continuing the Company's current policy in this area, we will be able to provide substantial and reliable protection not only for the JB10 model, but also for subsequent improvements and modifications.
Unpredictable demand
We are not sure about the demand for our jetpacks at the moment. This is a new area, our Jetpack is a dangerous technique. Lack of demand can adversely affect our business outlook, operations and financial condition. From the very beginning, we are aiming at various market, including military and defense, niches, search and rescue activities, entertainment (air shows, sports and entertainment events), and commercial (security, intelligence, fast transport). Demand in these areas is uncertain. As a start-up company, we don’t have the financial resources of major aircraft manufacturing companies to counter market changes and demand disruptions for our products.
Our success depends heavily on our current management team.
Our success depends heavily on David Meiman, founder and chief director, and Nelson Tyler, who both played key roles in the design and development of our product. Lord Mayman and Tyler are the driving forces behind the development of our jetpack and company. Depriving them of participation will have a negative material effect on our business. We have no alternatives to these key figures - the respected Mayman or Tyler.
Aviation is inherently a dangerous occupation
Our business introduces a completely new type of aircraft. It is in its infancy, and as always in such situations there is a risk of a fall or accident. Such an incident can greatly affect our reputation, our future plans and our further development.
Borrowing risks
We may have to take a loan from financial institutions. Typical debt agreements may contain stringent requirements that may affect our operational flexibility. Failure to make payments on a debt obligation may entail a court order, which will have a material negative effect on our business, on the results of operating activities or on financial condition.
Control by the majority shareholder
The only director and majority shareholder of the company is David Meiman. Investors will not be able to influence the management of the company.
Limited transfer and liquidity
Certain provisions of the Securities Act must be observed before selling, transferring, converting or other actions with our ordinary shares. For them, there is no public market and is not expected in the future.
Forecasts: planning information
Any assumptions about our financial success are hypothetical and are based on management estimates of the best operating results of our operations and have not been revised by our independent accountants. These assumptions are based on certain assumptions that management believes are reasonable. Some of them may not occur regardless of management actions. Therefore, the real results of the company will differ from the forecasts, and these differences may be material in nature. There are no guarantees on the project results.
legal information
Compliance Requirements
The company has never previously violated the requirements of crowdfunding.
Management Discussion and Analysis of Financial Condition and Results
We are considered a company at the initial stage of development, because most of our work consists in establishing our business, and the main planned actions have not started. Our operations start in September 2016 (our Hong Kong unit - May 2015), and we are still working on our pre-sales prototype of the JB10 jetpack.
Financial statements
Our financial statements are presented in Appendix A, which is combined with the accounts of our Hong Kong office. Consolidated financial statements include the results of the Hong Kong office's operations through September 14, 2016, our registration dates.
Operating results
In 2017, we sold one jetpack for $ 255 thousand, but then we don’t plan to sell jetpacks before we complete the development of our jetpack and start working on pre-orders and advance payments, which we believe will not happen at least until 2018. According to our forecasts, we can conduct our activities until February 2018 without generating income.
At the end of 2015 and 2016, our operating costs were $ 2,941,112 and $ 5,057,666, respectively, and our consolidated net losses amounted to $ 2,941,112 and $ 5,01,016, respectively.
Liquidity and financial resources
As of the end of 2015 and 2016, our cash was $ 44,571 and $ 2,13160, respectively. To this day, we have financed our activities mainly with proceeds from the main shareholders of the company, funds attracted to our division and placement of securities. We received 225 thousand US dollars from the sale of one of our jetpacks, and as of April 27, 2017, we received about 200 thousand US dollars from the sale of ordinary shares.
In the future we will have to attract substantial additional capital. According to our forecasts, we will need to raise an additional $ 10 million to complete the development of a pre-sales prototype, to adjust production facilities, start production and begin to fulfill orders for our jetpacks.
We continue to work with the US Army, we need working capital to fulfill our obligations. In particular, it is required for the development of a safety parachute and engine control system. Moreover, additional capital is required for the successful development of models JB11 and JB12. The company continues to work with potential sponsors to create a jetpack aerobatic team.
Operating plan
The company plans to invest in the further development of the JB10 jetpack and our additional line of jetpacks. In particular, this implies the continuation of development of a parachute system, a multi-engine version of a jetpack, a training simulator and a training power pack with a power supply system in accordance with the Research and Development Agreement with the General Directorate of Special Forces of the US Department of Defense
The company is currently focused on the following R & D:
Security system: jetpacks operate at a height of from 0 to 10 thousand feet (3048 m), but most of the flights will take place at a low altitude, most likely up to several hundred feet. Therefore, it is extremely important to develop a system that ensures the safety of the pilot in the event of engine failure or damage to the aircraft. This is the only R & D we are working on. It is associated with a large number of risks and extensive testing work. Today it is difficult to determine exactly how much money is required for it, but according to our estimates it is about 200-300 thousand US dollars.
We are committed to the following major achievements:
- JB11: multi-engine version of JB10. The initial test flight is scheduled to take place in June 2017, with an automatic engine control system in August 2017.
- JB12: jetpack fully electrically operated. It is expected that the development will be completed by September 2017, the finished prototype and the beginning of test flights - December 2017.
- JB14: multi-engine, semi-autonomous manned platform. The initial development will be ready in June 2017, the beginning of the test flights - the end of 2017.
- JB15: multi-engine, fully autonomous unmanned platform. Initial development will be ready in February 2018, the beginning of test flights - the end of 2018.
The company has trained three pilots and has prepared a training program that is suitable for people who do not have flight experience and allows them to be trained in 2-3 weeks.
We are currently looking for several additional training and testing sites in southern California.
[The following is detailed financial information, for those who wish, you can find it here ]
Translation: Sergey Danshin
July 2018
Jb-10
Jb-11
Meanwhile, in Russia
You can follow how we are doing the first Russian turbojet of vertical take-off here:
- blog on Habré
- Telegram channel
- VK group
- my Fb profile
- letters to write here alexey.stacenko@gmail.com
Source: https://habr.com/ru/post/425033/
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