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Louis Springer: Good afternoon, and welcome to Wrap Technologies’ Second Quarter 2025 Earnings Conference Call. I’m Louis Springer, Vice President of Finance. Joining me today are Scot Cohen, Chief Executive Officer; Jared Novick, President and Chief Operating Officer; and Jerry Ratigan, Chief Financial Officer. We appreciate your time and continued interest in Wrap. Before we begin, please note that certain statements made on today’s call are forward-looking statements within the meaning of the federal securities laws. These statements are based on current expectations, assumptions and projections and involve risks and uncertainties that may cause actual results to differ materially. Important factors are discussed in our filings with the U.S. Securities and Exchange Commission, which are available at sec.gov.

The forward-looking statements included in this conference call are only made as of the date of this call, and we disclaim any obligation to update forward-looking statements, except as required by law. Nothing on this call constitutes an offer to sell or the solicitation of an offer to buy any security. Any offering, if made, will be pursuant to an effective registration statement and prospectus. Unless otherwise indicated, our commentary compares the quarter ended June 30, 2025, with the prior year period. As a reminder, we may reference non-GAAP measures to provide additional insight into our operating performance. Reconciliations to the most directly comparable GAAP measures are or will be provided in our supplemental materials. With that, I’ll turn the call over to our CEO, Scot Cohen.

Scot Jason Cohen: Good afternoon, and thank you for joining us. I’m excited to get right to the point. Momentum is building for Wrap Technologies across the industry throughout our operations and most notably with a sharp increase in purchase orders. In fact, I can share that in the first 6 weeks of Q3, we received more purchase orders for Wrap devices than we did in the entire 6 months of the year. The end of Q2 marks an important milestone. The formal conclusion of our restructuring efforts. We believe the benefits of our prior year cost control measures are now fully realized. Q2 also marked the completion of our go-to- market pivot, where we abandoned an unscalable costly model we knew it was not working in a direct response to customer needs built a renewed strategy and solution offering.

Customers have validated the new approach with numerous agencies now using BolaWrap more than any other tool on their belt. And we’re seeing a broader market validation and regulatory changes throughout the increasing restricted policies around higher use of force. I am happy to say that we’re seeing positive results. Already in Q3, we’ve received new purchase orders for our new go-to-market strategy. We believe this increase in sales activity confirms initial success that we expect to continue. Later in this call, Jerry Ratigan, our CFO, will shed more light into our financials. For those of you that have been on this journey with us, thank you. Your steadfast support and belief in our company’s potential have helped us turn the corner and the results we present today are a direct reflection of that transformation.

To illustrate the progress we’ve made, today’s discussion will be organized into 3 broad categories: the first, market and performance and product performance. And why we believe this is a good place for an investor and a customer we’re supporting details, including market observations, BolaWrap deployment usage, recent conducive regulatory landscape and resulting positioning. Go-to- market strategy and team readiness and how we respond to customers’ needs and align and improved branding and messaging and strengthening our executive team to take our solution to market. And on financial and strategic initiatives, how our financial performance showcased cost reductions, cash flow improvements and key internal initiatives that we believe are now playing strategic — paying strategic dividends.

You’ll hear directly from our President, Jared Novack; and our CFO, Jerry Ratigan, as we walk through our performance strategy and what’s shaping up to be an active second half of the year. Together, they will cover improvements in cost controls and operational margin expansion, revenue growth from our recently launched bundled subscriptions and expansion of the BolaWrap through repurpose integrations that open large addressable markets. They will also discuss emerging relationships with renowned experts in policing and respective thought leaders, both individually and through formal agreements currently in progress, further positioning the company to explore adjacent markets with such as global private security, health care, transit and Department of Defense applications.

We have persevered and now we have the clarity. So let’s begin.

Jared Novick: Thank you, Scot. Our first section today is about market and product performance. BolaWrap deployments are increasing across diverse law enforcement agencies, ranging from small departments to large influential agencies in key geographies as well as specialized units such as school resource officers and crisis intervention teams. The net effect is a growing record of documented trust effective integration and consistent field success. Agencies across Colorado, North Carolina and Canada, as examples, have reported strong usage of BolaWrap relative to their own inventory while several of the largest law enforcement agencies in Florida are actively evaluating it as a strategic replacement for traditional electronic control devices like TASERs. Another major Floridian agency, their crisis intervention team reports more frequent BolaWrap use than TASERs, reinforcing the devices growing reputation as a safer and more appropriate tool during mental health or mostly disturbed person calls.

Now notably, to date, there have been no reported serious injuries and 0 lawsuits related to BolaWrap deployments. That’s a record uncommon and most traditional use of force tools. Historically, use of force data has been difficult to gather with many federal data sets being complete or unreliable. Agencies are often reluctant to share their data unless there’s a deep level of trust or establish agency-to-agency relationship. However, through our own conversations with long-standing customers, we believe that many departments are quietly moving away from higher levels of force such as TASERs due to declining usage, high costs and safety concerns. The increasingly restrictive policies are promoting agencies to rethink their approach with a new focus on minimizing risk while maintaining control without better tools, officers often find themselves relying on hands-on methods, which increases the risk of injury for everyone involved.

These discussions reinforce what we have long believed there is still no other effective tool to bridge the tactical gap between verbal commands and physical control. Officer injuries and lawsuits are continuing to rise and it underscores an urgent and largely unacknowledged need in modern policing. We believe our analysis reveals a clear pattern. In agencies without comprehensive Wrap programs electronic weapon usage is declining while low-level hands-on control tactics are increasing. That’s a dangerous scenario. This is leading to more officer injuries and exposing serious gaps in their current toolkits. In contrast, when agencies have a full Wrap program and they have adopted it, they’re experiencing a significant rise in BolaWrap deployments based on their operational needs and it’s now outperforming electronic weapons and higher-level use of force incidents, delivering lower liability, higher success rates and greater safety.

It’s a good news story. Now I want to talk about the favorable federal regulatory changes. We know that favorable policies and legal precedents can drive adoption, they can help deployments, and they certainly help sales. In Q2, we began to see the positive impact of some of these policy shifts both domestically and internationally. Notably, in the United States, the unanimous Supreme Court decision on Barnes v. Felix was issued during Q2. This marks a noteworthy development in this regulatory landscape and favorable conditions to Wrap. This case established a nationwide requirement that confirm what we’ve known all along, officers deserve the best tools, the best tactics and the best training to deliver safer outcomes for themselves and the communities they serve.

The totality of circumstances test, now a federal law uniquely positions the BolaWrap to meet the needs of today’s officers while addressing the evolving legal landscape of liability. In Q2, public attention and use of force tools intensified with shows like Last Week Tonight dedicating a full segment to the dangerous risks and fatalities associated with tasers. When combined with the unanimous Barnes v. Felix Supreme Court decision and a recent unintended death in Central California, these events have amplified awareness and urgency around safer alternatives. And as a result, we’re seeing measurable upticks in inquiries in our strategic discussions with customers and opening up new conversations about BolaWrap and it’s a central place on the [ duty belt.

] Now we’re moving to our go-to-market strategy and team readiness and response. Within the last quarter, we completely redefined our message and repositioned our brand in the marketplace. This wasn’t intended just to be a marketing refresh. This is an intentional and strategic shift that has now recognized the evolved needs of public safety. We identified a strategic need to adapt to the federal regulatory changes that are imminent, the increasingly restrictive policies and higher uses of force and the rise of mental and behavioral health emergencies and launched what we call the era of pre escalation. We’re not just responding to the moment, we named it. And in doing so, we’ve branded and established that Wrap is a leader in pre-escalation.

We believe that we define a new operational timeline for officers, carving out and creating space before force is necessary. A moment when tools and better training and better outcomes can occur. This is what Wrap chose to operate in called the pre-escalation period. To support this new era, we introduced key terms that became foundational across our brand training and communications, terms like pre-escalation in the pre-escalation period. We also developed a new doctrine, the Wrap window of opportunity. A critical moment between verbal engagement and hands-on force where officers can act with control, clarity and compassion. But redefining a message means nothing unless our product, pricing and systems are fully aligned. That’s why we relaunched the BolaWrap 150 optimized our pricing models and introduced a family of integrated systems designed for departments to train, deploy and support pre-escalation operations at scale.

In short, this wasn’t just a relaunch, it was intended to be a redefinition of who we are and how we serve. Wrap has evolved beyond being just a product company. We believe we have become the architects of the pre- escalation era.

Scot Jason Cohen: Thanks, Jared. As we assess the collective market, it appears that agencies want more than a single vendor for their solutions. They want an alternative provider offering tools that meet today’s policing requirements, supported by complementary integrated and connected ecosystem of technology solutions on the [indiscernible]. We are responding directly to the customers’ demand and market needs, and we believe the success of the market leader in this space further validates that our path is the right one. As part of our go-to-market strategy, we completely rebooted our social media campaigns and our marketing activities. We executed a full-scale relaunch and rebrand to the Wrap Tech, Inc. across all social platforms, aligned our company branded messaging with the new pre-escalation narrative.

Our content strategy was targeted and segmented with a focus on high-impact viral ready content tailored to resonate with distinct audience groups from law enforcement professionals to public safety advocates. The results were immediate. We generated over 3 million views in just 30 days, driving significant boost in engagement and followership. All of this was accomplished with 0 ad spend. 100% organic campaigning that delivered authentic measurable results without reliance on paid promotion. We’ve also updated our customer status collateral. We’ve completed a full refresh of sales and marketing materials to align with our new brand identity and our messaging for this pre-escalation era. This included updated visual design, tone and product positioning across all customer-facing documents.

We also rebuilt the website and expanded product-specific pages, incorporating detailed information about BolaWrap 150 and real-world successes — success stories that highlight its impact. In addition, we grew our online library of content, including body-worn camera footage, media coverage and customer success stories to support sales conversations and demonstrate the value of our solutions in the field. Key to our go-to-market strategy is our team readiness and partnerships. A key Q2 initiative centered on outreach to strategic partners and advancement in agreements. Set to be formalized and announced in Q3, aimed at either broadening our sales outreach or deepening our value proposition within industry leaders of training and tactics. We believe training is absolutely central to our go-to-market strategy, encompassing both sales and post-sales efforts that prioritize customer success.

We believe police officers want to hear directly from officers about what works in the field. That peer-to-peer credibility builds trust that cannot be replicated or compromised. These partnerships are developed alongside 2 paths. Deeper within law enforce focused on the human factors, defensive tactics, arrest and control and other core policing competencies broader into other verticals, expanding into adjacent sectors such as health care, transportation, security, data sovereignty and other emerging areas of focus for the second half of ’25. In Q2, we strengthened our leadership with the appointment of Jerry Ratigan as CFO, a seasoned finance executive with over 20 years’ experience across public companies capital markets, investment banking and with enterprise scaling experience.

We are fortunate to have Jerry’s expertise guiding a critical function helping to instill a financial discipline and operational rigor that define mature, high- performing companies. We further strengthened our operational talent with personnel leading our revenue, sales and marketing and commercialization efforts. Formal announcements of these additions are expected in the third quarter. I’ll now turn it over to Jerry, our new CFO, to share the financial report.

Gerald Ratigan: Thank you, Scot. The last section today focuses on our financials and strategic initiatives. During Q2, we continued to execute on our enterprise-wide cost rationalization program. As a result, we delivered meaningful reduction on our operating expenses. First, our robust cost reduction initiative is substantially complete. Operating expenses were reduced by 26% from Q1 to Q2 2025, declining to $3.3 million from $4.5 million. On a year-to-date basis, operating expenses are down 14% compared to the same period last year, $7.9 million versus $9.1 million. We believe these are the tangible results of our disciplined approach to resource management and efficiency. Second, we achieved cash flow improvements. Net cash used in operation declined by $2.2 million for the first 6 months of 2025, down to $5 million compared to $7.2 million in the same period of 2024.

Cash and cash equivalents increased 16% to $4.2 million at June 30, 2025, up from $3.6 million at December 31, 2024. We believe this is evidence of prudent financial stewardship and a testament to our commitment to operational excellence. Third, our strategic repositioning is well underway. Revenue came in at $1 million for the quarter and $1.8 million year-to-date as we continue to focus on customer acquisition, delivering an enhanced value proposition and executing our new go-to-market strategy. Finally, we took a proactive step during the quarter to strengthen our balance sheet. On June 30, 2025, we amended the terms of certain of the company’s outstanding warrants, enabling us to reclassify the relating warrant liabilities to additional paid-in capital on that date.

This change eliminates the need to recognize mark-to-market changes in fair value through the statement of operations, thus reducing earnings volatility going forward. This takes us to our new subscriptions bundles and pricing models. Alongside our product, marketing, rebranding and messaging improvements, we also enhanced our pricing models. While our traditional product pricing remains available in the Wrap basic offering, we have introduced 2 new more attractive subscription plans, WrapReady and WrapPlus. These plans not only include our trusted BolaWrap devices, but also address a common customer concern, the price point of replacement cassettes. Both subscription tiers feature an integrated cassette program that ensures customers can replenish as needed reducing uncertainty around consumable costs and allowing agencies to meet operational needs with confidence.

Wrap is gaining momentum from Q2 into Q3. As we conclude Q2 and look ahead into Q3, we believe the increase in volume and size of purchase orders highlights a growing shift 1 from onetime product sales to multiyear Wrap subscription offerings. These subscriptions, including our newly launched WrapReady and WrapPlus bundles are supported by integrated cassette programs and are enhanced with a learning management system to effectively train officers on wrap solutions. We anticipate these valuable enhanced offerings aligned with our new go-to-market strategy will meet growing customer demands.

Jared Novick: Thank you, Jerry. As we wrap up our financials, I want to share some other select sales activities and initiatives. In Q2, Wrap applied for just under $1 million in DoJ funded grants to deliver pre-escalation tools, tactics and training across the U.S. Now these grant applications are currently under review but they are noteworthy in our pipeline. They also represent an important first step. We believe a renewed focus on federal programs and funding opportunities positions Wrap to potentially access larger grants and support pre- escalation initiatives at levels comparable to or possibly exceeding those historically allocated to deescalation efforts. While there can be no assurances, we are encouraged by the alignment between our technology and current federal priorities.

And as previously mentioned, policy shifts are creating new opportunities in the second half of 2025. Two major cities in the U.S. have initiated discussions to begin pilot program testing. While another major city is seeking to expand its initial program and increased deployments. And tomorrow morning, we are planning to launch training in Michigan with our first WrapReady department in the nation, a department that purchased through grant funding and now joins us in the era of pre-escalation. I’m also excited to announce that next week, WrapReady is expected to be introduced for the first time in the state of Florida at one of the premier law enforcement agencies in the U.S. Lee County Sheriff’s office. This new pilot program will train not only patrol deputies but will also test deployment of our device with Lee County’s corrections deputies Further reinforcing the operational scope of the BolaWrap.

Strategic initiatives are playing a key role in the work Wrap is doing today. We believe our Q2 discipline and targeted R&D investments are now paying dividends. Most recently, we announced a counter UAS capability by repurposing our patented BolaWrap 150 devices, creating a novel differentiated solution for a large DoD addressable market with significant international opportunities falling closely behind. Our BolaWrap cassettes and capabilities have now taken to the year with the R&D initiative of Wrap Merlin 1. This prototype launches Kevlar tethers to physically intercept hostile drones mid-air, offering a reusable alternatives to traditional jamming or Interceptor tools. The initiative targets the global counter UAS market projected to grow from $1.9 billion in 2023 to $6.8 billion in 2030.

And we intend to leverage our existing BolaWrap manufacturing infrastructure for rapid commercialization in both DoD and global defense markets. Another Q2 initiative now gaining traction involves rework offerings and new partnerships within our Intrensic body-worn camera business line. We have seen increased demand for North American made cameras to address data sovereignty concerns, and we responded by introducing solutions built for security in North America featuring advanced encryption and industry competitive body- worn camera capabilities. Accordingly, Intrensic will now be known as WrapVision, a subscription service with 4G LTE capabilities focused on meeting today’s new data standards and privacy requirements. This is all supported by a complementary digital software back end for managing digital evidence and other file management needs across public safety and allows us to approach adjacent markets such as health care and transportation.

Scot Jason Cohen: Thanks, Jared. In closing, Q2 was a decisive turning point for Wrap. We have successfully completed our restructuring, aligned our product pricing and branding under a unified pre-escalation strategy and delivered measurable operational and financial improvements. We reduced operational expenses by more than 1/4 from the prior quarter and secured meaningful purchase orders, many under multiyear subscription models that start to build recurring BolaWrap-related revenue. Our field data and customer feedback suggests that the BolaWrap is becoming the preferred low-force option for agencies that prioritize officer safety, community trust and reduce liability. We believe those achievements are visible in the marketplace validated by customers and supported by the evolving regulatory environment that favors our solutions.

We are entering the back half of ’25 with stronger fundamentals with many purchase orders received a differentiated product portfolio and an expanding addressable market from law enforcement to defense health care and transportation. Our disciplined cost management, expanded strategic partnerships and investment in R&D position us for growth. We believe our market is dynamic, it’s driven by police change and customer demand for safer tools. It sets the stage for continued acceleration. To our investors, our partners and our customers, thank you. for your confidence in us. We are committed to delivering the value, capturing the new opportunities, improving the Wrap’s next chapter in the upcoming months and years will be the strongest yet. With that, Louis, let’s then open it up for questions.

Louis Springer: Thank you, Scot. We’ve had a few questions come in, and I’m going to read them one by one. The first question is, how do you plan to accelerate adoption among law enforcement agencies in the U.S. and internationally?

Scot Jason Cohen: Look, this is happening without — this is — the market is — okay. Yes, all right. Look, this is happening, I wish I could take credit — I wish we could take credit for this is happening without us. There is policies being adopted now. We mentioned Barnes versus Felix couple of times in this call. But there’s policies, that’s a big shiny one but there’s other policies that are driving adoption now. That coupled. We know we were training this strong. We know that we weren’t being efficient with officers time. We were saying the wrong things. This is what happens in a start-up. I’d say it’s a new device for an industry that’s really, really tough to break into. So it took a lot. What really just a common sense of getting connected with the departments themselves, not just with the chiefs but the training and the officer.

So when you really get connected and before it was hard to get connected because we’re dealing with distributors, we’re dealing with salespeople and a whole lot of middleman, quite frankly but it wasn’t until we really got close went to go see those chiefs, went to go see those command staff, want to go see those trainers. Get everybody in a room and start really discussing what success looks like? What are the goals of the program? Where are you having successes? Where are you having failures and taking all that information bring it back into — back to Wrap and having our team go through that information and come back with a solution, a hole that we were able to plug and it took time. Yes, it took a lot of time, particularly when we were rightsizing the business and going through all the drama that many of you know we went through.

But I’ll tell you, once we got clear on what the message was, and we got clear on what was necessary from the training side and the connectivity that was required, not through trainers, just trainers. But through this learning management system to be able to deliver a consistent message every time and have that scale, that’s when we started seeing programs start to scale. And when you see programs scale and when you see it’s the most actively used device on belt today, which I know is hard for a lot of people to believe, it just — it’s not out there. You’re not reading about this. You have to talk to the people that have our product and you have to get — and it’s not everywhere. But the ones that are implementing these programs and having scale and having it be the most actively used device today, that is — there’s nothing they’re doing it’s unique.

It’s great leadership. It’s practice, it’s commitment, it’s working hand-in-hand with our city council. Everyone is in on it in some cases. In some cases, just trainers. But when it all connects and we get connected to that and able to deliver these bite-sized training lessons, you’re really going to — I think whatever we’re doing now is absolutely repeatable. Seeing 4, 5, 6, 7, 8, 9x deployment data, 9x more — in some cases, actually 10x more deployed devices, deployments than any other thing on their belt. That’s set up. But that is absolutely repeatable. It’s scalable. And we know that when we get connected with Wrap Plus, I think we could see it go much further. Jared, anything to add on that?

Jared Novick: Yes. I mean I’ll just add that to really accelerate adoption, it’s agencies are going to be pulling it into their departments. And we have a huge gap. It’s being more and more restricted to use higher uses of force. We’ve talked about that today. They’re going hands on. So the gap in need is there. So in part, yes, we need to accelerate and do our job going to market but it is being met with open arms because departments are acknowledging the problem. So we’re finally getting that validation, a wide-scale validation that there’s a need. It’s clear. The regulatory landscape is good. It’s our job now to take those tailwinds and accelerate our go to market.

Scot Jason Cohen: I’m going to add just one little piece to that. We were actually getting thanked by some of our biggest and most active customers, even some of the small, thank you for coming up with this type of support. Thank you for caring enough about this program. We hear that almost every time. There’s no other vendor out there that’s taken this kind of care. We hear that repeatedly. And actually, that’s one of the drivers to make me want to lean into this more. The fact that it’s so unaddressed on the training side, the fact that we’re just kind of getting connected with the customer in a different way. Not trying to sell them something but actually try to help for an outcome that we know is better. So our belief in the device and what we’ve seen through neighboring department for departments and different programs has actually given us, I think, great strength to lean into this because we know what’s right and what you hear from our customers, thanking us for doing this, you know we’re on the right path because they know it’s going to help them.

Louis Springer: Right. Okay. The Next question that came in is, how do you plan to penetrate non-law enforcement sectors, for example, corrections, private security, schools, hospitals.

Scot Jason Cohen: Well, we’re already penetrating them and a lot of it is coming directly to us. It’s fairly shocking. We said on the call that we kicked on — we turned on social media. And the incoming inquiries is, again, very inspiring to know there’s much more given the fact that we just started. So they’re coming to us. We see the — we understand the problems out there, and we’re hearing them on a daily basis. So the fact that we’re already in a number of hospitals and correction facilities, all that’s repeatable. It’s just a matter of scale. We weren’t set up the scale. We thought we were through distribution, we weren’t. And maybe we were to sell it through distribution but the problem with that is you’re not directly in touch with the customer.

Once you get in touch with the customer, you can — it’s much easier to see this. And once you get the kind of success and we can shine light on the success we’re having now, it’s spreading. We see neighboring counties, neighboring cities picking up. We see certain states where they’re having thriving programs. And it’s going right from departments to corrections to schools, to hospitals within that geological, geographical area. So I feel like it’s happening without a big push. Now we can get intentional about it. But one thing we have now that we didn’t have is the data. Everybody is interested in the data. Now granted, I wish it was a robust set of data for years and years. So truth is we just — company didn’t do a good job of getting it in the past.

But now that we have it, I think that’s the unlock. It’s what’s driving us. It’s what’s enabling, I think, all of it’s why so many new talented executives have joined us they’re seeing it as well. And when you could talk about black and white facts and show them the data, it tells its own story. We don’t have to tell it. The data is telling us what to do. So when you have a hospital, you have a school or you have a jail, correction facility that’s applying with success. That word, Public safety is a very connected community, it’s a very connected ecosystem. And yes, if we didn’t know it ourselves and have that data, how does anybody else supposed to know, but now that we have it, it just starting to spread. And we have an offering that addresses that need.

I think you’re going to see this start to accelerate pretty quick.

Jared Novick: What I also want to say, we talked about regulatory change, Barnes v. Felix. There was another piece that happened in late March of this year in 2025. It’s H.R. 2189 and that introduced the bill to Congress about less than lethal projectile devices, that’s what our BolaWrap is. And there’s the potential of some declassification of the BolaWrap, which will allow us to go to the markets like private security and hospitals and other areas. We see that as a tremendous impact to our addressable market. So everything that we figured out and now we’re doing right and law enforcement and public safety, those lessons learned, the video management system that we have, the learning management, all that is now poised to be applied in other verticals.

So as we’ve gotten our operations into control, we understand our messaging, we are bringing around pre escalation. All of that up applies in many orders of magnitude over in these larger markets. That’s what I see. And those markets will now — will appreciate that we have traction and recognize the law enforcement, thereby giving us the credibility to enter those new markets.

Louis Springer: Are there adjacent product lines or technology upgrades planned in the next 18 months?

Jared Novick: Yes. I mean it’s not only planned in the next 18 months. We’re doing it now. We just did some press releases on a counter drone or counter UAS system. And look, I have a background in the government and Department of Defense and some operations, particularly in airborne capabilities. And when you say a counter drone, that’s historically known to maybe be a capital-intensive endeavor. Well, guess what? This is not capital intensive. It’s simply repurposing the BolaWrap device or the BolaWrap cassettes as they are today, and we all know that we have that inventory. So when we say the investments that we’re making in Q2, those were investments in time and focus that they capitalize on the inventory we had already but repurposed in a new way.

And so when you see this counter UAS capability that’s basically in twofold, yes, a UAV or UAS to UAS counter drone capability where we’ll be hosting cassettes on that drone but also a surface-to-air capability where you take the traditional BolaWrap 150 that’s handheld and give you a quick reaction capability to disable and take down any drones that are immediate threat in a personal area. We know that’s a documented urgent operational need down range. And by doing, it’s very exciting for me, and I believe for our investors that this opens up the Department of Defense addressable market. And so as we look at adjacent product lines, it’s a very smart way for us to take what we are doing now is and move through partnerships and stay at that federal business line that we always have planned since the beginning of this year.

Counter drone and UAS is just one opportunity. The other thing that we’ve done is now rebranded Intrensic, which was that recurring business line for body-worn cameras and rebranded to WrapVision that means better camera hardware. So at the edge, better components, better battery life, better resolution. 4G-enabled if people want to integrate live feeds to real-time crime center, that’s operational and on. And because we understand data sovereignty and cybersecurity has been a long-standing issue for many people across the industries. We now have partnered with cloud providers who keep that data within the respective countries, in our case, in America, and it gives them the confidence that we’re handling the data correctly. That integrated WrapVision is scaled.

It gives different tiers of support, Tiers 1, 2 and 3 through our partner network. And it allows us to then offer greater bundling opportunities. For those who may just want to body cam solution and at a very attractive price to then also add on the BolaWrap capabilities in what we call WrapReady or WrapPlus. So the net effect of all these things, smart repurposing of our inventory and better management through partnerships that increased capability for WrapVision. That combined effect it gives us more than 18 months of activity to grow this company.

Scot Jason Cohen: And I just want to — I want to mention one of the new products that I’m most proud of, and I’ve got quite a bit of experience in learning management, the learning management training. The — we noticed it was clear to us that we weren’t connected with the customer. We had very little data. It was hard to get any — it was hard to get them on the phone. Let alone find out how the programs are going through. So it didn’t take long for. Once we realized that we had a connectivity issue to be able to come back to market with a way to get connected, a way to directly drop training into the officers right there to his phone and be able to access them for the officer to be able to access these really important tutorials, training in burst size increments.

We’re talking about 2 to 3 to 4 minutes of training versus having to go into a classroom and sit for 2 days and spend 20 hours. The accessibility of this training and showing it in a different way, talking about it in a different way. It doesn’t sound like a big technological breakthrough. But I feel like technology has allowed us and in an economic way to be able to deliver these really important training lessons that are absolutely going to change behavior. And what gets me excited is these programs are already lifting without this. So you can’t tell me when you get connected with an officer and we’re dripping and training and being respectful of their time in content and talk track, that’s a lot different than the past. And we were on that talk track and on these — this trend because of all those lessons we’ve learned, and the program — taken the best in the programs of thriving and delivering that directly to the officer.

It’s going to take usage to where it already is thriving to levels that I think are going to cause a lot more. It’s going to force departments to have to look at this because this pre-escalation error that we’re talking about this before things escalate, this is a really important. This is critical training for public safety that just has not been available. We’re going to own this space. We’re going to be launching other products into it around this in the next and we’re doing it now, and we’ll be leaning more into it. We’re just getting started. But this is going to build credibility with officers. This is what we’re being thanked for. And I think this is the beginning of really I think it’s actually as important, if not more important, the device itself.

If you don’t know if the operator that’s operating our device isn’t trained properly and we’re not respectful of his or her tone, just not going to have the same effect out there. And I think we’ve mastered that and we get to prove that in the next couple of months.

Louis Springer: The next question is, what’s the status of the company’s move to Virginia? And when do you expect production to ramp up as a result?

Jared Novick: Thanks, Louis. I’ll take that one. We are fully moved into Virginia. We are fully out of Arizona. We are fully out of Arizona. We have a production facility that we are scheduling with the state of Virginia to have an official launch physically. And in terms of our inventory and people, we are fully in Virginia. And we’re very proud to underscore to our customers, both domestically and internationally that our products will be made in America, in Wise County. We appreciate everything that the state of Virginia has done for us and our move there. In terms of production, it can absolutely be scaled. As a reminder, we do have inventory, which is attractive for our business now, but we have the knowledge documented in videos, checklists and procedures and the people on standby to start production and having QA, QC, quality controlled devices on the product line now.

We’re ready to accelerate that in response to our pipeline, which we are — is now a focus and growing. Internally, we’ve made investments into planning infrastructure and process and in looking at our supply chain so that any lead times that are required are sufficiently notified and that we’re prepared to meet demand with the right notice. So I’m confident about the team we’ve built around that. Bringing Jerry Ratigan in and his team are also documenting and scaling for the future. We see large demand in the future. So just to kind of put a fine point on it, we’re fully in Virginia.

Louis Springer: How do you see onetime sales versus subscription services as a portion of your revenues?

Gerald Ratigan: Yes. This is Jerry here. Happy to take this one on. Again, as highlighted on this call and through the Q&A, just to highlight, again, the optimization plan internally of alignment within the organization without the new product launches. We’re also doing that from a revenue generation standpoint. So we’re designing product and service offerings to deliver more value to our customers, a customer- first company. To deliver that value, we’re refining our go-to-market plans, our strategies, transitioning from the one-off a la carte sales efforts that historically had taken place within the company to more a recurring subscription-based revenue model. That’s, again, as Jared and Scot had highlighted, talking to the customers, learning more about their needs and what we can deliver on a more regular basis and eliminate the uncertainty of the customers and their purchasing process.

So at the forefront of this strategy, just focusing on the customer value proposition and again, as evidenced by recent launches of our Wrap Ready and WrapPlus packages and bundles, we expect those to achieve these objectives. I don’t know, Jared or Scot, if you had any other comments there?

Scot Jason Cohen: Particularly with the LMS and the training model, which will be recurring subscription-based. There’s another bucket of money dollars that open up to us. We’ve been selling the shiny object, the BolaWrap, which typically gets paid for out of capital goods, maybe even forfeiture dollars. But once you get into the training and the subscription services, there’s grant much bigger buckets that I think we can tap. So I feel like this is new for the business. We’re just exploring that — those buckets, and it’s being really well received. So I feel like for our subscription business, to be a lot more money. It’s an operating line that’s a lot bigger than a capital goods line. So we’ll be — I think we’re going to take full advantage of that coming up.

Jared Novick: Yes. And I’ll just pile on just a little bit more. Look, there’s — nothing has changed. You can still buy onetime stuff from us if you want to. You still want to — we’re making it easier for customers to get the full support that they need across the different features we put into that bundle at a more attractive price. And to Scott’s point, that allows us to go after training dollars versus operational CapEx dollars. So this is a positive, everything to gain and nothing to lose.

Louis Springer: Next question. Last earnings call, you spoke heavily about procuring accurate data surrounding BolaWrap deployments. What figures have you been able to come up with in comparison to other devices used by departments you’re partnered with?

Jared Novick: Scot, do you want to start that? Do you want me to start?

Scot Jason Cohen: Yes. All right. Let me start.

Jared Novick: But let me just first say for the callers here. We, as a company, honor the confidentiality of our customers. So we hold that data confidentially. We have collected significant data. We have cataloged that and track it for both them and our knowledge and our insights. And so we just have to generalize this response to the state level maybe is the best way to go about that.

Scot Jason Cohen: You would think when a company has got a product out there that the sharing of information would be very easy, and it would just be right in front of you we should have had it. It turns out in this industry in public safety, it’s not so easy. It’s very hard to collect this at a state level, at a federal level and on a small department level. It’s just — it’s been very difficult. But this is the crux of why we’re doing what we’re doing. This is why we’re backing the bed up on the BolaWrap device without great support from the company. Let’s call it out, with crappy support from the company, okay? But let’s just training support, customer support, it wasn’t there. We had no information. There’s a bunch of reasons for it.

It doesn’t matter anymore. What does matter is the information we got is driving this because there’s no way with the — with the usage that we’re seeing now in connected departments, it’s absolutely repeatable. So you asked the question, have we gotten more data, more data? Yes, we’re getting more and more data. It’s coming in. We’re getting data through the trainers now. We’re picking up the phones. We’re doing visits. We’re doing plenty of calls here. We’re pounding it really hard to get this. But this is where the action is at, and this is where I think the conviction comes from us. You know it’s being adopted with very little support from us with the right level of support that’s scalable, which we can offer, and we’re about to show the world that we can offer that.

We’re doing it right now. You’re going to see these numbers start to go up, and we’re going to develop a more trusted relationship with this sensitive information that will have a lot more data back. And everybody that we’re talking to about WrapPlus, and we can’t go out to the entire industry, we picked a dozen with full — again, thanking us for coming up with this. Part of the agreement is they’re going to share data with us. And we think that data is so valuable that we’re willing to give it away for a fixed period of time to get that data because I think this data is going to drive the whole device adoption throughout the country, throughout the world. and supporting it the right way with — that will give us the right to bring out this — the LMS.

And from there, we start with BolaWrap training, yes. But in short order, we get to talk about pre-escalation and train in the pre-escalation space. We’re talking about persuasion skills, communication skills, how to make decisions under stressful situations. This is an area that is absolutely needed. It’s under that, it’s undertrained in this industry. It takes a long time to get access to it if you’re lucky enough and it’s expensive, guess what? We’re going to make it available in burst- like increments and economically and effectively being respectful of their time as well. And I think this is where you really start to get a lot more data because they’re going to feel comfortable. We’re partnering with these departments. And I feel like this first dozen or so on the WrapPlus launch, these are our partners.

They want it to be used on a day. They want to pre-escalate these situations. They don’t want to get into an escalated situation because they know what it costs. It costs offers’ careers. It costs a lot of money, and it costs careers. And it’s just — it’s not acceptable anymore. And the regulation and the policies around this are just getting stricter and stricter. So the change is coming. We’re right on the forefront.

Louis Springer: Great. And before I read the next question, how are you doing on time that you need to like edit and cut this before fourth call?

Scot Jason Cohen: Should we cut Brandon, you want to cut…