ROCKETDNA LTD. — Interim / Quarterly Report 2019

Jan 23, 2019

Appendix 4C Quarterly report for entities subject to Listing Rule 4.7B

+Rule 4.7B

Appendix 4C

Quarterly report for entities subject to Listing Rule 4.7B

Introduced 31/03/00 Amended 30/09/01, 24/10/05, 17/12/10, 01/09/16

Name of entity

ParaZero Limited

ABN Quarter ended (“current quarter”) 17 618 678 701 31 December 2018

Consolidated statement of cash flows	Current quarter $US’000	Year to date (12 months) $US’000*
1. Cash flows from operating activities 1.1 Receipts from customers 1.2 Payments for (a) research and development (b) product manufacturing and operating costs (c) advertising and marketing (d) leased assets (e) staff costs (f) administration and corporate costs 1.3 Dividends received (see note 3) 1.4 Interest received 1.5 Interest and other costs of finance paid 1.6 Income taxes paid 1.7 Government grants and tax incentives 1.8 Other – transaction costs 1.9 Net cash from / (used in) operating activities	380 (79) (558) (98) - (436) (245) - 1 (3) - 147 -	809 (998) (1,298) (408) - (969) (1,060) - 1 (86) - 338 (486)
	(891)	(4,157)

• On 13 June 2018, ParaZero Limited (PRZ) completion of the acquisition of 100% of the issued capital of Israeli company ParaZero Ltd (ParaZero Israel). In accordance with Accounting Standards, the acquisition of Parazero Israel has been accounted for as a capital reorganisation. As a result, the year to date consolidated statement of cash flows comprises the cash transactions of Parazero Israel for the period 1 January 2018 – 31 December 2018 and the cash transactions of PRZ for the period 13 June 2018 – 31 December 2018.

• See chapter 19 for defined terms 1 September 2016

Page 1

Appendix 4C Quarterly report for entities subject to Listing Rule 4.7B

2. Cash flows from investing activities 2.1 Payments to acquire: (a) property, plant and equipment (b) businesses (see item 10) (c) investments (d) intellectual property (e) other non-current assets 2.2 Proceeds from disposal of: (a) property, plant and equipment (b) businesses (see item 10) (c) investments (d) intellectual property (e) other non-current assets 2.3 Cash flows from loans to other entities 2.4 Dividends received (see note 3) 2.5 Other – cash on reverse acquisition 2.6 Net cash from / (used in) investing activities	(28) - - - - - - - - - - - -	(32) - - - - - - - - - 396 - 15
	(28)	379
3. Cash flows from financing activities 3.1 Proceeds from issues of shares 3.2 Proceeds from issue of convertible notes 3.3 Proceeds from exercise of share options 3.4 Transaction costs related to issues of shares, convertible notes or options 3.5 Proceeds from borrowings 3.6 Repayment of borrowings 3.7 Transaction costs related to loans and borrowings 3.8 Dividends paid 3.9 Other (provide details if material) 3.10 Net cash from / (used in) financing activities	- - - - - (16) - - -	3,701 1,036 - (145) 180 (161) - - -
	(16)	4,611
4. Net increase / (decrease) in cash and cash equivalents for the period 4.1 Cash and cash equivalents at beginning of quarter/year to date 4.2 Net cash from / (used in) operating activities (item 1.9 above)	1,526 (891)	54 (4,157)

• See chapter 19 for defined terms

1 September 2016

Appendix 4C Quarterly report for entities subject to Listing Rule 4.7B

4.3 Net cash from / (used in) investing activities (item 2.6 above) 4.4 Net cash from / (used in) financing activities (item 3.10 above) 4.5 Effect of movement in exchange rates on cash held 4.6 Cash and cash equivalents at end of **quarter ***	(28) (16) (6)	379 4,611 (302)
	585	585

• The Company has just raised approximately AU$846k (before costs) via a non-renounceable entitlement offer and currently has a Shortfall Offer open to raise up to an additional AU$2.08M (before costs).

5. Reconciliation of cash and cash equivalents at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts	Current quarter $US’000	Previous quarter $US’000
5.1 Bank balances 5.2 Call deposits 5.3 Bank overdrafts 5.4 Other (provide details) 5.5 Cash and cash equivalents at end of quarter (should equal item 4.6 above)	585 - - -	1,526 - - -
	585	1,526

6.	Payments to directors of the entity and their associates	Current quarter
		$US'000
6.1	Aggregate amount of payments to these parties included in item 1.2	69
6.2	Aggregate amount of cash flow from loans to these parties included	-
	in item 2.3
6.3	Include below any explanation necessary to understand the transactions included in items
	6.1 and 6.2

Item 1.2 includes directors’ fees and salaries.

7.	Payments to related entities of the entity and their	Current quarter
	associates	$US'000
7.1	Aggregate amount of payments to these parties included in item 1.2		-
7.2	Aggregate amount of cash flow from loans to these parties included		-
	in item 2.3
7.3	Include below any explanation necessary to understand the transactions included in
	items 7.1 and 7.2

• See chapter 19 for defined terms 1 September 2016

Appendix 4C Quarterly report for entities subject to Listing Rule 4.7B

8. Financing facilities available Add notes as necessary for an understanding of the position 8.1 Loan facilities 8.2 Credit standby arrangements 8.3 Other (please specify)	Total facility amount at quarter end $US’000	Amount drawn at quarter end $US’000
	56	56
	-	-
	-	-

• 8.4 Include below a description of each facility above, including the lender, interest rate and whether it is secured or unsecured. If any additional facilities have been entered into or are proposed to be entered into after quarter end, include details of those facilities as well.

Loan facility 1 – secured long term bank loan of US$11k bearing interest rate of 5.7%. Loan facility 2 – secured long term bank loan of US$14k bearing interest rate 5.7%. Loan facility 3 – secured long term bank loan of US$19k bearing interest rate 3.25%. Loan facility 4 – secured long term bank loan of US$12k bearing interest rate of 3.25%.

9. Estimated cash outflows for next quarter*	$US’000
9.1 Research and development 9.2 Product manufacturing and operating costs 9.3 Advertising and marketing 9.4 Leased assets 9.5 Staff costs 9.6 Administration and corporate costs 9.7 Other (provide details if material) 9.8 Total estimated cash outflows	36 256 143 - 508 169 16
	1,128

* The Forecast does not include revenues expected in Q1 of the calendar year.

* The Forecast does not include funds received from the non-renounceable entitlement offer just completed which along with the partially underwritten amount of AU$800K equated to AU$846k which is expected in Q1.

10. Acquisitions and disposals of business entities (items 2.1(b) and 2.2(b) above)	Acquisitions	Disposals
10.1 Name of entity	-	-
10.2 Place of incorporation or registration	-	-
10.3 Consideration for acquisition or disposal	-	-
10.4 Total net assets	-	-
10.5 Nature of business	-	-

• See chapter 19 for defined terms 1 September 2016

Appendix 4C Quarterly report for entities subject to Listing Rule 4.7B

Compliance statement

• 1 This statement has been prepared in accordance with accounting standards and policies which comply with Listing Rule 19.11A.

• 2 This statement gives a true and fair view of the matters disclosed.

Sign here:

............................................................ Date: 24 January 2019 Company Secretary

Print name: Mr Stephen Buckley

Notes

1. The quarterly report provides a basis for informing the market how the entity’s activities have been financed for the past quarter and the effect on its cash position. An entity that wishes to disclose additional information is encouraged to do so, in a note or notes included in or attached to this report.

2. If this quarterly report has been prepared in accordance with Australian Accounting Standards, the definitions in, and provisions of, AASB 107: Statement of Cash Flows apply to this report. If this quarterly report has been prepared in accordance with other accounting standards agreed by ASX pursuant to Listing Rule 19.11A, the corresponding equivalent standard applies to this report.

3. Dividends received may be classified either as cash flows from operating activities or cash flows from investing activities, depending on the accounting policy of the entity.

4. See chapter 19 for defined terms 1 September 2016