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招股说明书

Jet.AI Inc.

30,100,000 普通股股份

这 招股说明书涉及不时转售最多30,100,000股我们的普通股，每股面值0.0001美元 (“普通股”)，由本文所述的出售股票的股东(与任何该等股东的受让人合称， 质权人、受让人、分配人、受赠人或利益继承人，“出售股东”)。普通股股份 在此登记的股份包括：(I)我们为出售而发行的100,000股普通股(“有效股”) 股东于2024年9月3日支付效果费(定义见此)；及(Ii)最多30,000,000股 转换(X)50股B系列优先股后可发行的普通股，每股票面价值$0.0001(“系列” B优先股)，由出售股东持有，并根据函件协议(定义见下文)发行(以下简称《函件 协议股份“)，及(Y)1,500股可于行使认股权证时发行的B系列优先股(”认股权证“) 由出售股东持有(“认股权证转股股份”)，连同效力 股份和字母协议股份，简称“股份”)。了解更多有关 共享，请参阅“招股说明书摘要- 论出售股东交易.”

我们 本招股说明书涵盖的股份的登记并不意味着出售股东将要约或出售任何 股出售股东通过私人交易收购股份，豁免证券项下的登记 经修订的1933年法案（“证券法”）。

我们 将不会从本次发行中出售股份的股东转售股份中获得任何收益。所有销售和其他 出售股东发生的费用将由出售股东支付，但不包括某些法律费用和费用， 将由我们支付。出售股东可出售、转让或以其他方式处置本公司提供的任何或全部股份 不时在纳斯达克股票市场有限责任公司(“纳斯达克”)或任何其他证券交易所、市场或交易机构上发布招股说明书 股票在其上交易，或在私人交易中。该等股份可由 以固定价格出售股东，出售时的市价，与当时的市价有关的价格，或私下出售 协商好的价格。请参阅标题为“配送计划“有关如何销售的详细信息 股东可以要约、出售或处置他们的股份。在出售股东行使全部或部分权力的范围内 对于认股权证，我们将收到该行使的行使价。我们将承担与我们的义务相关的所有费用和开支。 以登记股份。

我们 普通股在纳斯达克交易，代码为“JTAI”。2024年10月22日，我们的最后一次报告售价 纳斯达克普通股为每股0.0911美元。

我们 可根据需要通过提交修订或补充来不时修改或补充本招股说明书。你应阅读整本 在您做出投资决定之前，请仔细阅读招股说明书以及任何修订或补充。

我们 是美国联邦证券法定义的“新兴成长型公司”，因此选择遵守 减少上市公司报告要求。本招股说明书符合适用于新兴发行人的要求 成长型公司。

投资 在我们的普通股中存在风险。在购买任何普通股之前，您应该仔细审查风险和不确定性 从本招股说明书第10页开始的“风险因素”标题和所包含的文件中描述 参考本招股说明书。

既不 美国证券交易委员会或任何国家证券委员会均已批准或不批准这些证券或通过 根据本招股说明书的充分性或准确性。任何相反的陈述都是刑事犯罪。

的 本招股说明书日期为2024年10月23日

表 内容

约 本招股说明书

这 招股说明书是我们向美国证券交易委员会(“美国证券交易委员会”)提交的S-1表格注册说明书的一部分。 据此，出售股东可不时提供及出售或以其他方式处置我们普通股的股份 包含在本招股说明书中。我们将不会从出售股东出售所提供的股份中获得任何收益 它们在本招股说明书中有描述。我们亦可提交招股章程补充文件或于生效后对注册说明书作出修订。 本招股说明书是其中的一部分。招股说明书补充或生效后的修订可以增加、更新或更改所包含的信息 在这份招股说明书中。如果本招股说明书中的信息与适用的招股说明书补充资料有任何不一致之处 或生效后修订，应以招股说明书副刊或生效后修订为准。注册 我们提交给美国证券交易委员会的声明，包括提供讨论事项更多细节的展品，本招股说明书是其中的一部分 在这份招股说明书中。您应阅读本招股说明书、任何生效后的修订、任何适用的招股说明书附录及相关 在您做出投资决定之前，向美国证券交易委员会备案的展品。登记声明和展品可从以下地址获得 美国证券交易委员会，如标题为“哪里可以找到更多信息”一节所示。

你 应仅依赖本招股说明书中包含的信息。我们和销售股东均未授权任何人提供 除本招股说明书所载者外，阁下不得提供任何资料或作出任何陈述、任何生效后的修订、 或由吾等或代表吾等拟备的任何适用的招股章程副刊，或吾等已向阁下转介的任何适用的招股章程副刊。我们和出售方股东 对于其他人可能提供给您的任何其他信息的可靠性，我们不承担任何责任，也不能提供任何保证。如果有人 为您提供不同或不一致的信息，您不应依赖它。您应该假设出现的信息 在本招股说明书中，对本招股说明书的任何生效后的修订和任何适用的招股说明书附录仅在 日期在各自的封面上。自那以后，我们的业务、财务状况、运营结果和前景可能发生了变化。 我们和出售股票的股东都不会在任何司法管辖区提出出售我们的普通股的要约 是不允许的。阁下不应假设本招股章程所载资料有任何生效后的修订及任何适用的 本招股说明书附录以其各自日期以外的任何日期为准。我们的业务，财务状况， 自这些日期以来，运营结果和前景可能发生了变化。你应该仔细阅读本招股说明书的全文。 做出投资决策。

行业 和市场数据

一些 本招股说明书中包含的市场和行业数据基于独立行业出版物或其他公开可用的 信息.我们相信，截至其发布日期，该信息是可靠的，然而，我们尚未独立 已验证且无法向您保证此信息的准确性或完整性。因此，您应该意识到市场 和此处包含的行业数据，以及我们基于此类数据的信念和估计可能不可靠。

招股书 总结

这 摘要重点介绍了本招股说明书其他地方包含的或通过引用并入本文的信息。此摘要不包含 在投资我们的普通股之前您应该考虑的所有信息。在决定投资我们的股票之前 普通股，您应仔细阅读整个招股说明书，包括本招股说明书中题为“风险”的部分 因素”从第10页开始。

作为 除非文意另有所指，本招股说明书中使用的术语“公司”、“Jet.AI”、 “我们”、“我们的”和“我们”是指Jet.AI Inc.（f/k/a牛津剑桥收购公司），及其 合并子公司。

公司 概述

我们 业务战略将部分喷气式飞机和包机计划的概念与人工智能的创新相结合，也提到了 这里是“AI”。我们有目的地增强价格发现有可能产生更公平、更具包容性的结果 适合飞机所有者和旅客。

我们 该公司于2018年6月4日成立。我们开发并于2019年9月推出了以iOS应用程序JetToken为代表的预订平台 (the“App”），最初是一个勘探和报价平台，用于安排与第三方的私人飞机旅行 载波收购HondaJets后，我们开始出售飞机卡和飞机的部分所有权权益。2023年， 我们推出了一款名为CharterGPt的人工智能增强型预订应用程序。从2023年开始，我们推出了Jet.AI运营商平台，以提供B2B SaaS产品的软件平台。目前我们普遍向飞机所有者和运营商提供以下SaaS软件：

我们 还为拉斯维加斯金骑士队和西锐航空队建立了特定版本的私人飞机按座位预订工具 通过380 Software LLC。380 Software LLC是我们与Cirrus Aviation之间的按座位包机合资企业。

我们 战略包括扩大我们的机队，配备能够飞行更远距离的更大飞机，开发国家喷气式飞机 基于第三方飞机的卡计划，进一步增强Charter GPt的人工智能功能，并扩展我们的B20亿软件 奉献。

这个 业务合并

在……上面 2023年8月10日，特拉华州的Jet.AI Inc.(f/k/a Oxbridge收购公司)完成了一项“业务合并”。 根据日期为2023年2月24日的《企业合并协议和重组计划》，该协议和重组计划经第1号修正案修正为 《企业合并协议》，日期为2023年5月11日，由牛桥收购公司(以下简称牛桥)签署，合并后 潜艇和喷气机令牌。根据企业合并协议，牛津剑桥以特拉华州公司的身份重新注册，并立即 更名为Jet.AI，Inc.，此后立即：(A)OXAC合并Sub I，Inc.，特拉华州一家公司和一家直接全资子公司 Of Oxbridge(“第一合并子公司”)与Jet Token合并并并入Jet Token，Jet Token在合并后作为全资子公司幸存下来 Jet.AI Inc.；以及(B)Jet Token与Summerlin Aviation LLC(f/k/a OXAC Merge Sub II，LLC)合并，特拉华州有限责任公司 公司及牛津剑桥的直接全资附属公司(“第二合并附属公司”)(每项合并及所有其他拟进行的交易 根据企业合并协议，“企业合并”)。

的 业务合并导致Oxbridge和Jet Token的某些证券被转换为公司的证券。因此 业务合并以及公司在业务合并后采取的某些行动，Jet.AI Inc.拥有一类普通股，在纳斯达克上市，股票代码为“JTAI”。见“管理层的 财务状况和经营结果的讨论与分析-业务合并” 之进一步讨论 业务合并条款的规定。

某些 融资安排

之前 就业务合并而言，吾等订立若干融资安排，旨在向吾等提供以股权为基础的 融资，包括(I)于2022年8月4日订立的购股协议(“购股协议”) 由Jet Token和GEM Year LLC SCS和GEM Year巴哈马Limited(连同GEM Year LLC SCS，“GEM”)组成，后者是 在企业合并结束时自动分配给公司(“结束”)；及(Ii)远期购买 于2023年8月6日(经2023年8月31日和2023年10月2日修订)与(A)气象资本合伙公司(“MCP”)签订的协议， (B)Metora Select Trading Opportunities Master，LP(“MSTO”)；及(C)Metora Strategic Capital，LLC(“MSC”及， 与MCP和MSTO合称为MSTO)，用于场外股权预付远期交易。在……里面 与业务合并有关，我们还与Maxim签订了和解协议Group LLC，承销商 本公司首次公开招股(“Maxim”)，并与OAC赞助商 有限公司，开曼群岛的豁免公司(“保荐人”)，牛津和剑桥的保荐人，各自规定发行股权 以履行牛津和剑桥的付款义务。

看到 “管理层对财务状况和经营业绩的讨论和分析-“流动性和资本 资源-概述” 进一步讨论这些融资安排和其他最近融资的条款 交易

的 出售股东交易

一般信息

对 2024年3月28日，公司签订证券购买协议（“证券购买协议”）并 下文描述的与已完成的私募相关的与出售股东的其他交易文件 于2024年3月29日（“截止日期”），我们统称为“出售股东交易”。

根据 根据证券购买协议，公司同意向出售股东发行（a）150股b系列优先股， 可转换为普通股股份，（b）购买最多1，500股b系列优先股的授权令 行使价为每股10，000美元，和（c）250，000股普通股。

的 公司收到的总收益约为1.5亿美元，不包括惯例的安置费和某些金额的报销 作为配售代理支付给Maxim的费用以及公司就出售股东交易支付的其他费用。 该金额不包括行使令状的收益（如果有）。该公司使用最初收到的净收益 关闭，打算将进一步行使令状后的收益用于运营资本、资本支出、产品 开发和其他一般企业目的。公司尚未将具体金额的所得款项净额分配用于上述任何目的。

系列 b优先股

对 2024年3月28日，我们向特拉华州国务卿提交了b系列优先股指定证书， 其中规定发行最多5，000股b系列优先股（“指定证书”）。b系列优先股排名 pari 享有平等 与公司的A系列优先股及其A-1系列优先股以及高级 对公司所有其他股本。

每个 B系列优先股的股份转换为我们普通股的若干股份，受某些限制，包括受益 4.99%的所有权限制(根据《证券交易法》第13(D)条颁布的规则计算 经修订的1934年生效的《交易法》(以下简称《交易法》))，可在61天前调整为9.99%的实益所有权限制 卖出股东的书面通知。出售股份的股东可不时转换B系列优先股 转换为普通股的股票，它可以清算，然后根据随后的转换获得额外的普通股 其B系列优先股。虽然受益所有权限制对出售股东的股份施加了具有法律约束力的限制 实益所有权在任何时候，它不禁止出售股东在一段时间内获得普通股 在单独转换其B系列优先股的股份时，该股在一段时间内合计超过受益的 所有权限制。

主题 符合前款规定的限制，且只要有有效的登记声明涵盖出售 股东转售B系列优先股转换后可发行的普通股，即 B系列优先股的股票将在上市后第十个交易日或之前自动转换为普通股 B系列优先股这类股票的发行日期。普通股转换后可发行的普通股数量 B系列优先股的计算方法是将B系列优先股的每股转换金额除以 价格。转换金额等于B系列优先股的声明价值，即10,000美元，外加任何额外的 根据指定证书计算的金额和滞纳金。转换价格等于90%(或，在 退市的情况下，我们的普通股在一段时间内的最低日成交量加权平均价格(VWAP) 从我们向出售股东交付普通股后的第二个交易日开始至结束 在我们普通股的美元总交易量超过适用兑换金额的七倍的交易日， 此类计算的最短期限为五个交易日，并可进行某些调整。

如果 发生指定证书中定义的某些定义的“触发事件”，例如违反注册 2024年3月29日与出售股东签订的权利协议（“注册权协议”），暂停 普通股交易，或者我们未能在转换权时将b系列优先股转换为普通股 被行使，那么我们可能需要以其设定价值的110%赎回b系列优先股以现金。

的 上述对b系列优先股的描述并不声称是完整的，而是通过参考 指定证书，其副本作为本招股说明书的附件3.5存档 一部分，并通过引用并入本文。

其他 交易文件

的 令状行使价最初设定为每股b系列优先股10，000美元，但可能会因某些事件而调整，例如 作为股票分拆、发行额外股份作为股息或其他方式。如果该令状被全额行使以获取现金，公司 将获得约15亿美元的额外总收益。公司无法预测何时或是否将行使该令状。 该逮捕令可能永远不会被行使。任何时候，当该令状可行使少于1，000股系列股票时 b优先股，公司有权通过向出售股东付款来赎回全部或部分令状 每股现金100美元的b系列优先股，否则该优先股将根据该令状发行。

根据 根据证券购买协议，公司同意向其股东提交一份批准发行股票的建议 在特别会议上根据纳斯达克规则转换B系列优先股时可发行的普通股 在证券购买协议日期后的最早可行日期，但在任何情况下不得迟于 (90)截止日期后90天。公司签订了一项表决协议(“表决” 协议》)，与公司临时首席执行官迈克尔·温斯顿和赞助商共同持有约 43.6%的公司投票权，截至公司年度股东大会记录日期，同意投票 赞成这项提议。在2024年9月24日举行的年度股东大会上，公司寻求股东 根据出售股东交易可能发行普通股的批准，金额为 发行，可能导致发行普通股的金额超过公司流通股的20% 以低于纳斯达克上市规则第5635(D)条所界定的“最低价格”的价格出售普通股。 该公司的股东在年度会议上批准了这种潜在的发行。《证券购买协议》规定 公司将保留不少于B系列优先股转换后可发行普通股最高股数的200% 已发行股票，使用替代折算方法(“所需储备额”)。公司与出售股东 已同意所需储备额为45,000,000股普通股。为了履行这一义务，该公司寻求 股东批准修改其公司注册证书，将普通股的法定股数增加到200,000,000股 在其年度股东大会上。该公司于2024年9月24日获得批准。

另外， 本公司订立《登记权协议》，其中规定本公司将登记转售 在250,000股普通股和B系列优先股转换后可发行的普通股中，包括 转换B系列优先股时可发行的普通股可在认股权证行使时发行的普通股。这个 公司被要求在不迟于公司提交以下文件的30天内向美国证券交易委员会提交注册说明书 截至2023年12月31日止年度的10-K表格年报(下称“10-K表格”)，但无论如何不得迟于2024年5月15日 (“申请失败”，以及这样的截止日期，“提交截止日期”)，并使用其商业上合理的努力 在不迟于(A)60日历日之前宣布登记说明书和任何修正案生效 提交10-k表格(或，如果此类登记声明有待美国证券交易委员会全面审查，则为后100个日历日) 及(B)美国证券交易委员会(以口头或书面形式，以较早者为准)通知本公司之日起第二个工作日 这种登记声明将不会被审查或将不会受到进一步审查(“有效性截止日期”)。 本公司根据上述义务在申报截止日期前提交了S-1表格的注册说明书。因为这个登记 声明在生效截止日期前未被美国证券交易委员会宣布生效，本公司有义务向卖家付款 股东交纳100,000美元费用(“效果费”)。2024年9月3日，本公司向销售人员发出 股东100,000股普通股(“效益股”)，代替现金支付效益费。

对 2024年9月24日，公司与出售股东签订书面协议（“书面协议”） 其中阐述了公司与出售股东之间的某些谅解和协议。根据该协议， 出售股东同意不采取行动来保护其在交易文件下的合法权利，涉及 协议书中确定的公司在日期之前已采取或实施的某些行动和交易 协议书。作为豁免的对价，公司同意解除出售股东及其附属公司的解除 并向出售股东额外发行了50股b系列优先股。

对 2024年10月10日，公司与出售股东签订第二份书面协议（“第二份书面协议”） 其中阐述了公司与出售股东之间的某些谅解和协议。根据第二份书面协议， 出售股东同意不采取行动来保护其在交易文件下的合法权利，涉及 第二份协议书中确定的某些行动和交易。此类行动包括公司提交修正案 提交给SEC的S-1表格（文件号333-281911）的登记声明和登记的直接发行。的现金代价 豁免后，公司同意更改先前的转换测量期（定义见指定证书） 发行200股b系列优先股，从2024年3月28日开始，根据指定证书结束。

的 公司还同意赔偿出售股东、其成员、经理、董事、高级职员， 合伙人、员工、代理人、代表和根据登记声明控制出售股东的人员 承担某些责任，并支付与该公司相关的所有费用和支出（不包括任何承保折扣和销售佣金） 公司在《注册权协议》下的义务。

的 根据证券购买协议发行的证券并未根据《证券法》登记，而是根据 根据《证券法》和/或规则第4（a）（2）条豁免《证券法》的注册要求 根据《证券法》颁布的D法规第506（b）条。未经注册，该证券不得在美国发售或出售 或适用的注册要求豁免。

副本 证券购买协议、投票协议、令状、登记权协议和信函的内容 协议分别作为附件10.30、10.31、4.5、10.32和10.39提交，其注册声明 本招股说明书构成一部分。上述此类协议和文件的摘要并不完整，并且符合以下条件： 其全部内容通过引用此类协议并通过引用并入本文。

纳斯达克 合规

我们的 普通股目前在纳斯达克挂牌交易，交易代码为“JTAI”。2023年12月1日，公司收到通知 纳斯达克上市资格人员通知本公司的纳斯达克上市资质人员函(《初步通知函》) 其股东权益金额已降至继续在纳斯达克全球上市所需的最低万金额1,000美元以下 纳斯达克上市规则第5450(B)(1)(A)条(“最低股东权益要求”)。该公司的 截至2023年12月31日，股东赤字为3963,039美元。最初的通知信还指出，截至9月30日， 2023年，该公司不符合纳斯达克全球市场另类上市标准的“市值” 标准或“总资产/总收入”标准。最初的通知信还指出， 公司可以考虑申请将公司的证券转让给纳斯达克资本市场，这将需要 除其他事项外，本公司须满足纳斯达克资本市场的持续上市要求。2024年8月14日， 纳斯达克听证会小组批准了公司将公司证券从纳斯达克全球 纳斯达克资本市场入市自2024年8月16日开盘之日起生效。

在……上面 2024年4月14日，公司收到纳斯达克追加通知函(《第二通知函》) 声明本公司不符合纳斯达克上市规则第5450(A)(1)条，作为本公司 普通股已连续30个工作日低于每股1.00美元(“最低投标价格要求”)。通知 违规行为不会立即影响公司普通股在纳斯达克的上市或交易。该公司拥有180家 日历日，或直到2024年10月14日，以重新遵守最低投标价格要求。要重新获得合规，最低限度 公司普通股的投标价格必须在至少连续十个工作日内达到或超过每股1.00美元 这是180天的宽限期。如果公司不能在10月前重新遵守最低投标价格要求 14,2024，公司可能有资格获得额外的180个日历天的合规期，因为它选择将 到纳斯达克资本市场。要获得资格，该公司将 须符合公开持股市值的持续上市要求及所有其他初始上市标准 对于纳斯达克资本市场，除投标价格要求外，将需要提供其意向书面通知 在第二个合规期内解决投标价格不足的问题。该公司在此期间未能重新获得合规 可能会导致退市。该公司打算积极监测其普通股的投标价格，并可能在适当的情况下考虑 实施可用的选项，以重新遵守最低投标价格要求。

对 2024年5月30日，公司收到纳斯达克的额外通知函（“第三份通知函”），称 公司尚未重新遵守继续上市的最低股东权益要求 在初步通知信中进行了讨论，根据其合规计划，该公司必须在2024年5月29日之前召开该通知信。的 第三份通知信通知公司，除非公司要求在纳斯达克听证会小组（ “小组”）于2024年6月6日之前，公司普通股将在开业时暂停交易 于2024年6月10日，并向SEC提交25-NSO表格，SEC将删除公司的证券 在纳斯达克上市和注册（该通知，“退市通知”）。

AS 在第三封通知信中指示，公司 及时要求小组进行听证，并支付了适用的费用对除名通知提出上诉。退市公告 对公司普通股的上市或交易没有立竿见影的影响。公司的听证请求被搁置 本公司证券暂停买卖，本公司证券继续在纳斯达克交易。在8月 2024年14日，关于公司合规计划的实施，纳斯达克听证会小组批准了公司的 申请将公司证券从纳斯达克全球市场转移到纳斯达克资本市场以生效 截至2024年8月16日开盘。此外，纳斯达克听证会小组批准了公司的请求，在 2024年11月26日，以证明其遵守之前提交的计划，该公司认为这一最后期限是 可以实现的。公司正在努力纠正退市通知中列出的不足之处，并计划恢复 在切实可行的范围内尽快遵守持续上市的规定。

虽然 该公司相信能够遵守纳斯达克的持续上市要求，但无法保证 公司将能够重新遵守该等要求，或维持遵守任何其他上市要求 在纳斯达克要求的时间范围内或根本没有，特别是如果公司股价持续低于1.00美元， 期纳斯达克认定我们未能达到纳斯达克的持续上市标准可能会导致我们的证券 根据退市通知的规定，从纳斯达克退市。

风险 因素

我们 业务面临多种风险，您在做出投资决定之前应该了解这些风险。讨论了这些风险 更详细地参见本招股说明书摘要之后的本招股说明书“风险因素”部分。这些风险包括 以下是：

的 提供

风险 因素

投资 在我们的普通股中存在很高的风险。除了包含或合并的信息、文件或报告 您应仔细考虑本招股说明书以及（如适用）任何招股说明书补充或其他发售材料中的提及 在做出投资决定之前，除本招股说明书中包含的其他信息外，还应了解以下风险。我们 业务、财务状况或运营结果都可能受到任何这些风险的损害。因此，您可能会失去部分或全部 您对我们普通股的投资。以下描述的风险和不确定性并不是我们面临的唯一风险和不确定性。额外风险不 我们目前已知的或我们目前未认为对我们的业务构成重大风险的其他因素也可能损害 我们的业务运营。

风险 与公司业务相关

的 公司是一家经营历史有限的早期公司。

这个 该公司的前身运营公司Jet Token，Inc.成立于2018年6月4日。因此，本公司的历史有限 投资者可以据此评估其业绩和未来前景。该公司历史较短，飞机数量有限 以及相关客户。该公司目前和拟开展的业务将面临与较新企业相关的所有业务风险。 这些因素包括公司对其市场发展做出反应时可能出现的经营业绩波动，管理其业务的困难 增长和竞争对手进入市场。该公司迄今已发生净亏损，并预计将继续出现净亏损 在可预见的未来。该公司不能向您保证在可预见的未来会盈利或产生足够的 利润来支付股息。如果公司确实实现了盈利，公司不能肯定它将能够维持或 提高这种盈利能力。该公司并未持续从运营中产生正现金流，因此无法确定 它将能够在未来的运营中产生正现金流。为了实现并保持盈利能力，该公司 必须实现许多目标，包括扩大和稳定其收入来源和增加支付的数量 为其服务的成员。要实现这些目标，可能需要大量的资本投资。公司不能保证 它将能够实现这些目标。

的 如果公司未能成功获得额外融资，可能无法继续运营其业务，因此， 可能无法继续经营。

这个 公司依靠其运营资金、融资安排的收益和额外的筹资来维持 它正在进行的运营。该公司在运营中遭受经常性亏损，并积累了大量亏损。结果 在这些经常性运营亏损中，有来自运营活动的负现金流和对额外资本的需求 对公司作为持续经营企业的持续经营能力产生了极大的怀疑。因此，我国独立注册公共会计 公司包括一段解释性段落，对公司作为持续经营企业的持续经营能力表示极大怀疑 在其关于公司截至2023年12月31日的年度经审计财务报表的报告中。财务报表有 已根据美国公认会计原则(“GAAP”)编制，该原则设想本公司 将继续作为一家持续经营的企业运营。公司的财务报表不包含任何可能导致的调整 如果它不能继续作为一个持续经营的企业。不能保证管理层能够在可接受的条件下筹集资金 致公司。如果公司无法获得足够的额外资本，公司可能被要求减少 其计划的开发和运营的近期范围，这可能会推迟公司业务计划的实施，以及 损害其业务、财务状况和经营业绩。在这种情况下，公司可能不得不大幅削减其 运营或推迟、缩减或停止其一个或多个产品的开发，寻求替代融资安排， 宣布破产或完全终止其业务。

的 公司可能无法成功实施其增长战略。

这个 该公司的增长战略包括，通过向非会员开放私人航空来扩大其潜在市场 通过我们的市场，向新的国内市场扩张，并发展邻近的业务。公司面临诸多挑战 在实施其增长战略方面，包括其在市场、业务、产品/服务和地理扩张方面的执行能力。 该公司的增长战略依赖于其扩展现有产品和服务的能力等 并推出新的产品和服务。尽管公司投入了大量的财政和其他资源进行扩张 在其提供的产品和服务中，它的努力可能不会在商业上取得成功或取得预期的结果。该公司的 财务业绩及其保持或提高竞争地位的能力将取决于其有效衡量 指导其主要市场，并在这些市场中成功识别、开发、营销和销售新的或改进的产品和服务 不断变化的市场。该公司未能成功实施其增长战略可能会产生实质性的不利影响 关于其业务、财务状况和运营结果，以及任何潜在的预期成本节省或预期成本估计 收入可能不准确。

的 由于多种因素，公司的经营业绩预计难以预测，这也将影响其长期 性能

的 公司预计未来其经营业绩将因多种因素而大幅波动，其中许多因素是外部因素 它的控制性且难以预测。因此，公司经营业绩的期末比较可能不是 其未来或长期表现的良好指标。以下因素可能会在不同时期影响公司并可能影响 其长期表现：

的 公司的业务主要集中在某些目标地理区域，因此容易受到与拥有相关的风险的影响 地理上集中的业务。

Jet.AI的 客户群主要集中在美国的某些地理区域。因此，Jet.AI的业务、金融 运营状况和结果容易受到区域经济低迷和其他区域因素（包括国家法规）的影响 以及预算限制和恶劣的天气条件、灾难性事件或其他干扰。随著Jet.AI寻求扩大其现有的 市场，这些地区的增长机会将变得更加有限，并且公司的地理集中度 生意可能会增加。

如果 公司无法内部或外部为其飞机提供融资或产生足够的资金来支付外部融资 消息人士称，该公司可能不会成功。

作为 这是航空行业的惯例，该公司依赖外部融资来收购其飞机，并且很可能 未来需要额外的融资来发展其机队。如果公司无法产生足够的收入或其他 为支付该租赁安排的付款资金，出租人可能会收回飞机，这将产生重大不利影响 对公司的业务和声誉。此外，如果公司无法为未来的飞机获得外部融资， 出于任何原因，包括与公司的业务或前景或更广泛的经济有关的原因，公司可以 无法成长和/或生存。

的 公司可能没有足够的资本，可能被要求筹集更多资本，随后的融资条款可能会不利 影响您的投资。

这个 公司预计需要获得信贷，以支持其在发展过程中的营运资金需求。利率在上升， 而且这是一个以优惠条件获得信贷的艰难环境。如果本公司在需要时无法获得信贷，本公司 可能会发行债务或股权证券来筹集资金，修改其增长计划，或采取一些其他行动。债务证券的利息可能 增加成本并对经营业绩产生负面影响，可转换债务证券可能会稀释您在 结伴。如果公司不能以优惠的条件获得额外的资本，那么它可能会选择停止其 销售活动。在这种情况下，唯一剩余的能够产生投资回报的资产可能是公司的智力 财产。即使公司没有被迫停止其销售活动，资本的缺乏也可能导致公司履行 低于预期，这可能会对您的投资价值产生不利影响。

的 公司的业务和声誉依赖并将继续依赖第三方。

的 公司一直依赖第三方应用程式开发商来开发其应用程式的初始版本，并且公司可能会继续依赖 第三方用于未来开发任何新的或修订的应用程式的部分。公司依靠第三方应用程式开发商来代替第三方应用程式开发商 无论是内部开发还是由公司首席技术官监督的自由承包商。公司拟 继续建设内部开发团队，并逐步减少对外部承包商应用程式开发的依赖。 如果应用程式的进一步开发出现延迟或复杂情况，这可能会导致包括但不包括的困难 仅限于以下内容：

的 公司还预计将严重依赖其现有运营合作伙伴西锐航空服务公司来维护和运营公司的 租赁飞机进行包机服务，当客户通过其平台预订航班时，公司将依赖第三方运营商 与这些运营商。公司和西锐都积极预订公司飞机的包机。Cirrus通过以下方式预订章程 其24小时包机部门和公司通过其应用程式预订包机。这些第三方未能履行这些职责 适当可能导致公司声誉受损、客户损失、潜在诉讼和其他费用。本公司可 他们的工作也会遇到延误、缺陷、错误或其他可能对其结果和能力产生不利影响的问题 实现盈利。

的 公司依赖第三方网际网路、移动和其他产品和服务来提供其移动和网络应用程式以及飞行 向客户提供的管理系统以及对公司使用这些服务的任何干扰或干扰都可能 对其业务、财务状况、运营运绩和客户产生不利影响。

这个 公司平台的持续和不间断的表现是其成功的关键。该平台依赖于 互联网、移动和其他不受公司控制的基础设施服务的性能和可靠性。而当 本公司已聘请信誉良好的供应商提供这些产品或服务，本公司对业务没有控制权 第三方供应商使用的设施或系统。这些设施和系统可能容易受到损坏或中断 免受自然灾害、网路安全攻击、人为错误、恐怖袭击、停电、流行病和类似事件或行为的影响 行为不端。此外，公司第三方服务提供商的任何服务级别的任何更改都可能对 影响公司满足客户要求的能力。虽然公司认为它已经实施了合理的 备份和灾难恢复计划，该公司已经经历过，并预计未来它将经历、中断、延迟 以及由于各种因素造成的服务和可用性中断，这些因素包括基础设施更改、人员或软体 错误、网站托管中断、容量限制或公司无法控制的外部因素。持续的或重复的 系统故障将降低公司产品的吸引力，并可能扰乱公司客户的 做生意。维持和改善我们的表现可能会变得越来越困难，特别是在使用高峰期，因为 公司扩大了其产品和服务范围。这些中断引起的任何负面宣传或用户不满都可能 损害公司的声誉和品牌，可能对公司产品的使用产生不利影响，并可能损害公司的 业务、财务状况和经营业绩。

的 公司依赖第三方维持开放市场来分发其移动和网络应用程式。

的 该公司应用程式的成功部分依赖于维持开放市场的第三方，包括Apple App Store和Google 播放，使我们的应用程式可供下载。该公司无法保证其分销其产品的市场 应用程式将维持其当前结构，或者此类市场不会向公司收取列出其应用程式供下载的费用。

的 公司可能无法充分保护其智慧财产权利益或可能被发现侵犯智慧财产权 他人的利益。

的 公司的智慧财产权包括其商标、域名、网站、移动和网络应用程式、软体（包括 我们的专有算法和数据分析引擎）、版权、商业秘密和发明（无论是否可申请专利）。公司 相信其智慧财产权在保护其品牌和业务竞争力方面发挥著重要作用。如果 公司没有充分保护其智慧财产权，其品牌和声誉可能会受到不利影响，其能力 有效竞争可能会受到损害。

的 公司通过商标、域名和其他措施组合保护其智慧财产权。公司已注册 其目前在美国使用的商标和域名。公司的努力可能不够或有效。 此外，公司可能无法阻止竞争对手获得与以下内容类似或削弱的商标或域名： 其智慧财产权的价值。此外，其他方可能复制或反向工程公司的 应用程式或其他技术产品。此外，公司的专有算法、数据分析引擎或其他软体或 商业秘密可能会被第三方或公司员工泄露，这可能导致公司失去任何竞争对手 它可能从他们那里获得优势。

在 此外，公司的业务还面临第三方侵犯其智慧财产权的风险。本公司可 并不总是能够成功地确保对其智慧财产权的保护、识别或制止对其智慧财产权的侵犯，并且可能 未来需要诉诸诉讼来行使其在这方面的权利。任何此类诉讼都可能导致巨额成本 以及资源的转移。此外，此类执法工作可能会导致公司智慧财产权被裁定为 权利不可执行。

此外， 航空和科技行业的公司经常受到基于知识产权指控的诉讼 侵权、挪用或其他违法行为。随著公司的扩张和知名度的提高，知识产权的可能性 针对它的索赔越来越多。此外，公司可能会收购或引入新的技术产品，这可能会增加 公司对专利和其他知识产权索赔的风险敞口。任何针对本公司的知识产权索赔， 无论是否有任何可取之处，和解或诉讼都可能既耗时又昂贵。如果公司没有成功地进行辩护 这样的索赔，可能被要求支付大量损害赔偿金，或者可能受到禁制令的约束，或者同意和解，从而可能阻止 它无法使用其知识产权或向客户提供其产品。一些知识产权索赔可能需要 公司寻求许可证以继续其运营，而这些许可证可能无法以商业合理的条款或 可能会大幅增加公司的运营费用。如果公司无法获得许可证，则可能需要许可证 开发非侵权的技术替代方案，这可能需要大量的时间和费用。这些事件中的任何一种都可能对 影响公司的业务、财务状况或运营。

一 延迟或未能识别和设计、投资和实施某些重要的技术、业务和其他举措可能 对公司的业务、财务状况和经营运绩产生重大影响。

在 为了运营运务、实现目标并保持竞争力，公司不断寻求识别和设计、投资 实施和追求技术、业务和其他重要举措，例如与机队结构相关的举措， 业务流程、信息技术、旨在确保高质量服务体验的举措等。

的 公司的业务和公司运营的飞机的特点是不断变化的技术、引入和增强 飞机和服务的型号以及不断变化的客户需求，包括技术偏好。公司未来成长 财务表现将部分取决于其开发、营销和整合新服务以及适应最新服务的能力 技术进步和客户偏好。此外，引入与 公司的产品和服务可能会导致其收入随著时间的推移而减少。如果公司无法升级其运营 或船队及时或完全掌握最新技术进步，其业务、财务状况和运营结果 可能会受苦。

的 公司依赖其信息系统，这些系统可能容易受到网络攻击或其他事件的影响。

这个 公司的运营依赖于其资讯系统以及由其收集、处理、存储和处理的资讯 这些系统。该公司严重依赖其电脑系统来管理其客户账户余额、预订、定价、处理 和其他过程。公司接收、保留和传输某些机密资讯，包括个人身分资讯 客户提供的资讯。此外，对于这些业务，公司在一定程度上依赖于机密资讯的安全传输 通过公共网路向包机运营商提供资讯。公司的资讯系统受到损坏或中断的影响 因停电、设施损坏、电脑和电信故障、电脑病毒、安全漏洞，包括信贷 信用卡或个人身分资讯泄露、协同网路攻击、破坏、灾难性事件和人为错误。如果 公司的平台被黑客入侵，这些资金可能面临被盗的风险，这将损害公司的声誉和 很可能是它的生意。对公司资讯系统的任何重大破坏或网路攻击，特别是涉及 未经授权或不当的人员访问、获取、损坏或使用机密资讯可能会损害公司的 并使其面临监管或法律行动，并对其业务和财务业绩产生不利影响。

因为 公司的软体可用于收集和存储个人信息、解决其所在地区的隐私问题 公司的运营可能会给公司带来额外的成本和责任，或抑制其软体的销售。

的 全球隐私问题的监管框架正在迅速发展，并且在可预见的未来可能仍然不确定。许多 政府机关和机构已经通过或正在考虑通过有关收集、使用、储存和 个人信息披露和违规通知程式。公司还必须遵守法律、规则和法规 与数据安全有关。这些法律、规则和法规的解释及其对公司软体的应用 且适用司法管辖区的服务正在进行中，目前无法完全确定。

在 美国，其中包括联邦贸易委员会、电子贸易委员会授权颁布的规则和法规 《通信隐私法》、《计算机欺诈和滥用法》、《2018年加州消费者隐私法》（「CCPA」）和 与隐私和数据安全相关的其他州和联邦法律。例如，CCPA要求承保企业提供 向加州居民提供新的披露，为他们提供选择退出某些个人信息披露的新方式，并允许 为数据泄露提出新的诉讼理由。它包括一个框架，其中包括潜在的法定损害赔偿和私人权利 行动上CCPA和其他州新出现的类似隐私法将如何影响公司的业务存在一些不确定性 商业，因为这取决于如何解释此类法律。随著公司扩大业务，遵守隐私法可能会 增加其运营成本。

的 公司可能没有足够的资金来维持业务直到盈利。

的 公司可能无法准确预测其使用资金的速度以及这些资金是否足以使业务实现 盈利

Jet.AI 面临与美国税收相关的风险。

意义重大 在确定Jet.AI的收入拨备时，需要根据对现有税收法律或法规的解释进行判断 税金。Jet.AI的有效所得税税率可能会受到各种因素的不利影响，包括但不限于变化 在具有不同法定税率的税收管辖区的收益组合中，递延税项资产和负债的估值变化， 现行税收政策、法律、法规或税率的变化，不可扣除费用(包括股份)水准的变化 薪酬)、Jet.AI运营地点的变化、Jet.AI未来研发水准的变化 支出、并购或者各税务机关的审查结果。尽管Jet.AI认为其税收估计 是合理的，如果国税局或任何其他税务机关不同意其纳税申报表上的立场， Jet.AI可能会承担额外的纳税义务，包括利息和罚款。如果是重要的，在最终付款时支付这些额外的金额 任何纠纷的裁决都可能对我们的运营结果和财务状况产生实质性影响。

变化 适用的税法和法规或额外所得税负债风险可能会影响Jet.AI的业务和未来 盈利

一 该公司的前身牛津剑桥收购公司，是根据开曼群岛法律组织的。Jet.AI是美国 公司，因此其全球收入须缴纳美国企业所得税。此外，由于Jet.AI的运营和客户 Jet.AI位于美国各地，须缴纳美国各种州和地方税。美国联邦、州、地方和非美国 税法、政策、法规、规则、法规或法令可能会对Jet.AI产生不利影响 并可能对其业务和未来盈利能力产生不利影响。

为 例如，已经提出了几项税收提案，如果获得通过，将对美国税法产生重大变化。此类提议 包括将适用于公司（例如Jet.AI）的美国所得税率从21%提高到28%。国会可以考虑，并且 可以包括与可能进行的税收改革有关的部分或全部提案。目前尚不清楚这些或类似的 将颁布变更，如果颁布，任何此类变更何时生效。因此通过任何立法 美国联邦所得税法的提案和其他类似变化可能会对Jet.AI的业务和未来的盈利能力产生不利影响。

作为 由于计划扩大Jet.AI的业务运营，包括扩大税法可能不有利的司法管辖区， 义务可能会发生变化或波动，变得更加复杂或受到税务机关审查的更大风险， 其中任何一项都可能对Jet.AI的税后盈利能力和财务业绩产生不利影响。

在 如果Jet.AI的业务在国内或国际上扩张，其有效税率未来可能会大幅波动。 未来有效税率可能会受到根据GAAP无法记录税收优惠的司法管辖区的营运亏损、递延税资产和负债的变化或税法的变化的影响。因素 可能对Jet.AI未来的有效税率产生重大影响的因素包括但不限于：（a）税法或 监管环境，（b）会计和税务标准或实践的变化，（c）营运收入构成的变化 按税务司法管辖区和（d）Jet.AI业务的税前经营运绩。

另外， Jet.AI在美国可能要承担大量的收入、预扣和其他纳税义务，并可能需要纳税 在美国其他许多州、地方和非美国司法管辖区的收入、运营和子公司方面 那些司法管辖区。Jet.AI的税后盈利能力和财务业绩可能会受到波动或受到众多 因素，包括(A)可获得减税、抵免、免税、退款和其他福利，以减少纳税义务， (B)递延税项资产和负债的估值变动(如有的话)；。(C)预计任何递延税项资产和负债的释放的时间和数额。 税收估值免税额；(D)以股票为基础的薪酬的税务处理；(E)符合下列条件的收益相对数额的变化 不同法域的税收；(F)潜在的业务扩展到其他法域或以其他方式在其他法域征税； (G)改变现有的公司间结构(及与此有关的任何费用)和业务运作，(H)公司间的程度 交易以及相关司法管辖区的税务机关在多大程度上尊重这些公司间交易，以及(I) 能够以高效和有竞争力的方式组织业务运营。税务机关审计或审查的结果 可能会对Jet.AI的税后盈利能力和财务状况产生不利影响。此外，美国国税局 一些外国税务机关越来越关注与产品销售相关的公司间转移定价 以及服务和无形资产的使用。税务当局可能不同意Jet.AI的公司间指控，跨司法管辖区 转让定价或其他事项并评估附加税。如果Jet.AI不能在任何此类分歧中获胜，Jet.AI的盈利能力 可能会受到影响。

Jet.AI的 税后盈利能力和财务业绩也可能受到相关税法和税率、条约、 法规、行政做法和原则、司法决定及其解释，在每种情况下，可能具有追溯力 效果

Jet.AI的 利用其净营运亏损和税收抵免结转来抵消未来应税收入的能力可能会受到某些限制。

在……里面 一般而言，根据经修订的1986年《国内税法》(以下简称《守则》)第382条，任何公司如经历 “所有权变更”使用变更前净营业亏损结转(“NOL”)的能力受到限制。 以抵消未来的应纳税所得额。这些限制适用于公司经历“所有权变更”的情况，这通常是 指特定股东在三年内对其股权所有权的变动(按价值计算)超过50个百分点。 如果公司自成立以来的任何时候经历了所有权变更，Jet.AI可能会受到其能力的限制 利用其现有的NOL和其他税收属性来抵消应纳税所得额或纳税义务。此外，Jet.AI的未来变化 股权可能不在Jet.AI的控制范围内，这可能会引发所有权变更。州税法的类似规定 也可能适用于限制Jet.AI使用累积的州税收属性。因此，即使Jet.AI获得净应纳税所得额 在未来，它能够使用其变化前的NOL结转和其他税收属性来抵消此类应纳税所得额或纳税义务 可能会受到限制，这可能会导致未来对Jet.AI的所得税负担增加。

Jet.AI的 唯一的重大资产是其在子公司中的直接和间接权益，因此，Jet.AI将依赖于分配 从其子公司缴课征款并支付其公司和其他管理费用，并支付普通股股息（如果有）。

Jet.AI 是一家控股公司，除其在子公司的直接和间接股权外，其没有重大资产。Jet.AI将 没有独立的创收手段。在Jet.AI的子公司拥有可用现金的情况下，Jet.AI将导致其 子公司分配现金以课征、支付Jet.AI的企业和其他管理费用并支付股息， 如果有的话，则在普通股上。就Jet.AI需要资金而其子公司未能产生足够的现金流来分配而言 向Jet.AI提供资金或根据适用法律或法规或根据 他们的融资安排，或者无法提供此类资金，Jet.AI的流动性和财务状况可能 受到重大不利影响。

风险 与公司运营环境相关

需求 因公司的产品和服务可能因其无法控制的因素而下降。

需求 私人飞机包机可能会受到影响航空旅行的因素的负面影响，例如不利的天气条件、 传染病和其他自然事件的爆发、恐怖主义和安全筛查要求的增加。

在 特别是，大流行的复发，无论是COVID-19还是其他，都可能导致航空旅行的下降。此外，重新强加 旅行限制和其他旨在遏制任何此类病毒传播的措施可能会导致需求下降 航空旅行。如果旅行量在相当长的一段时间内保持普遍下降，该公司可能无法与更成熟的公司竞争 运营商可能无法在中期或根本实现盈利。

更多 总体而言，公务机旅行与经济表现高度相关，经济低迷，如当前的经济 受到高通货膨胀率、利率上升和消费者信心低迷的不利影响的环境 可能会对商务机的使用产生直接影响。该公司的客户可能会考虑通过其 产品和服务是一种奢侈品，特别是与商业航空旅行相比。因此，任何经济低迷 对公司客户的消费习惯产生不利影响，可能会导致他们减少旅行频率，并 旅行范围，使用商业航空公司或其他被认为比公司更经济的方式旅行 产品和服务。例如，从2008年开始，在宏观经济状况疲软的情况下，公司和高管 喷射机航空业和使用公务机的公司经历了更严格的政治和媒体审查。很有可能 目前的经济低迷将在一段时间内影响私人飞机旅行的需求。

任何 在这些导致私人飞机旅行需求下降的因素中，可能还会导致延误，从而降低吸引力 私人包机旅行与其他交通工具相比，特别是较短距离的旅行，这是我们的主要 目前的市场。延误还会让乘客感到沮丧，影响公司的声誉，并可能降低机队的利用率 以及由于航班取消和包机预订而增加的成本。该公司可能会经历需求下降，以及 如果它的一架飞机或通过我们平台预订的飞机或任何实际的飞机发生事故，名誉受损 或涉嫌客户违法滥用其平台或飞机。对公司产品和服务的需求可能 由于与其他运输方式相比，私人包机旅行成本增加的行动也有所下降，特别是努力 旨在应对气候变化，如碳税倡议或其他行动。上述情况或事件中的任何一种 减少对私人飞机包机的需求可能会对公司建立业务和实现 盈利能力。

的 公司面临著激烈的竞争，市场参与者众多，财务资源丰富，运营经验丰富。

的 私人航空旅行行业竞争异常激烈。影响该行业竞争的因素包括价格、可靠性、 安全、法规、专业声誉、飞机可用性、设备和质量、一致性和易于服务、意愿 以及为特定机场或地区提供服务的能力以及投资要求。该公司计划与私人飞机包机竞争 以及部分喷气式飞机公司以及公务机包机公司。私人飞机包机公司和公务机包机 公司拥有众多竞争优势，能够吸引客户。Jet.AI可以使用较小的机队 而区域重点使其处于竞争劣势，特别是在其对想要旅行的商务旅客的吸引力方面 海外

的 部分私人飞机公司和许多公务机包机公司可以获得更大的机队，并且拥有更大的 财政资源，这将使他们能够更有效地为客户服务。由于公司规模相对较小， 它更容易受到竞争活动的影响，这可能会阻止公司达到所需的销售水平 维持盈利运营。

最近 行业整合，例如VistaJet收购XOJEt和JetSmarter以及Wheels Up收购达美航空 私人喷气机队以及公务机服务公司Gama Aviation以及未来加强的整合可能会进一步加剧 公司面临的竞争环境。

那里 不能保证公司的竞争对手不会成功地占领我们现有或潜在客户的份额 基地任何这些风险的实现都可能对公司的业务、财务状况和业绩产生不利影响 的运营。

航空 企业通常受到超出其控制范围的因素的影响，包括：机场空中交通拥堵;机场时段限制; 空中交通管制效率低下;自然灾害;恶劣天气条件，例如飓风或暴风雪;增加和变化 安全措施;不断变化的监管和政府要求;新的或不断变化的旅行相关税;或疾病爆发; 其中任何情况都可能对公司的业务、经营运绩和财务状况产生重大不利影响。

喜欢 与其他航空公司一样，该公司的业务受到其无法控制的因素的影响，包括 机场，机场时段限制，空中交通管制效率低下，自然灾害，不利天气条件，增加和 不断变化的安全措施、不断变化的监管和政府要求、新的或不断变化的与旅行有关的税收或疫情 疾病的威胁。导致航班延误的因素让乘客感到沮丧，增加了运营成本，减少了收入，这反过来又可能 对盈利能力产生不利影响。在美国，联邦政府单独控制著美国所有的空域和航空运营商 完全依赖联盟航空局以安全、高效和负担得起的方式运营该空域。空中交通管制系统， 由美国联盟航空局运营的航空公司在管理美国航空旅行日益增长的需求方面面临挑战。美国空中交通管制员经常 依赖过时的技术，这些技术经常使系统不堪重负，迫使航空运营商飞行效率低下的间接航线，从而导致 延误和运营成本增加。此外，目前国会面临的一些提案可能会导致 美国空中交通管制系统的私有化，这可能对该公司的业务产生不利影响。

不良 天气状况和自然灾害，例如飓风、冬季暴风雪或地震，可能会导致航班取消或严重 延误了.由于恶劣天气条件或自然灾害、空中交通管制问题或效率低下而取消或延误， 安全漏洞或其他因素可能会对公司产生更大的影响，而竞争对手可能能够收回更多资金 迅速从这些事件中消失，因此可能对公司的业务、经营运绩产生重大不利影响 和财务状况比其他航空公司更好。客运量的任何普遍减少都可能产生重大影响 对公司的业务、经营运绩和财务状况造成不利影响。

的 飞机的运行面临各种风险，未能保持可接受的安全记录可能会对 我们获得和留住客户的能力。

这个 航空器的运行面临各种风险，包括灾难性灾难、坠毁、机械故障和碰撞，这些风险 可能导致生命损失、人身伤害和/或财产和设备的损坏。该公司未来可能会遭遇事故。 这些风险可能危及其客户、人员、第三方、设备、货物和其他财产的安全(公司的 和第三方)，以及环境。如果发生这些事件中的任何一种，公司可能会经历收入损失， 终止客户合同、提高保险费率、诉讼、监管调查和执法行动(包括潜在的 公司船队停飞和暂停或撤销其经营权限)以及对其声誉和客户的损害 两性关系。此外，如果公司运营或包租的飞机发生事故，公司可能会 对由此造成的损害负责，这可能涉及受伤乘客和已故乘客幸存者的索赔。可能会有 不能保证该公司在发生此类损失时可获得的保险金额是否足以覆盖 该等损失，或本公司不会因该等事件而被迫承担重大损失，不论其承保范围为何。

此外， 任何飞机事故或事件，即使已全额投保，也无论涉及公司或其他私人飞机运营商，都可能 让公众认为该公司不如其他私人飞机运营商安全或可靠，这可能会导致客户 失去信心并转向其他私人飞机运营商或其他交通工具。此外，任何飞机事故 或事件，无论涉及公司还是其他私人飞机运营商，也可能影响公众对行业的看法 安全性，这可能会降低客户的信任度。

的 公司花费了相当大的成本来维持（i）其安全计划、（ii）其培训计划和（iii）其车队的质量 飞机公司无法保证这些成本不会增加。同样，公司无法保证其努力将 提供足够的安全水平或可接受的安全记录。如果公司无法保持可接受的安全记录， 公司可能无法留住现有客户或吸引新客户，这可能会对其产生重大不利影响 业务、财务状况和经营运绩。

的 航空业的飞行员供应有限，可能会对公司的运营和财务状况产生负面影响。 劳动力成本的增加可能会对公司的业务、运营运绩和财务状况产生不利影响。

的 公司的飞行员须遵守严格的飞行员资格和机组人员飞行培训标准，除其他外 要求飞行员最短的飞行时间，并强制执行严格的规则以尽量减少飞行员的疲劳。有效存在此类要求 限制合格飞行员候选人的供应，并提高飞行员薪津和相关劳动力成本。飞行员短缺将需要 该公司将进一步增加劳动力成本，这将导致其盈利大幅减少。这些要求也会影响 公司运营所需雇用的飞行员安排、工作时间和飞行员人数。

在 此外，如果无法及时培训飞行员，公司的运营和财务状况可能会受到负面影响 方式由于美国联邦航空局资格标准下的飞行小时要求，全行业缺乏合格飞行员 以及其他行业参与者的招聘需求造成的流失，飞行员培训时间表显著增加， 强调飞行模拟器、教练员和相关培训设备的可用性。因此，公司的培训 试点可能无法以具有成本效益的方式或足够及时的方式完成，无法支持公司的运营需求。

试点 流失可能会对公司的运营和财务状况产生负面影响。

在 近年来，该公司观察到，由于其他地区飞行员薪津和花红的增加，飞行员流失率出现了显著波动。 行业参与者以及货运、低成本和超低成本航空公司的增长。如果流失率高于可用性 如果更换飞行员，公司的运营和财务业绩可能会受到重大不利影响。

的 公司因维护而面临运营中断的风险。

的 公司的车队需要定期维护工作，这可能会导致运营中断。公司无力履行职责 及时的维护和维修可能会导致其飞机利用不足，这可能会对其业务、财务产生不利影响 运营的条件和结果。有时，机身制造商和/或监管机构要求强制或建议 对特定机队进行修改，这可能意味著必须停飞特定类型的飞机。这可能会导致运营 扰乱公司并给公司带来重大成本。此外，随著公司飞机基地的增加，维护成本 可能会增加。

显著 燃料成本的增加可能会对公司的业务、财务状况和经营运绩产生重大不利影响。

燃料 对于公司飞机的运营以及公司开展运输服务的能力至关重要。 燃料成本是公司运营费用的关键组成部分。燃料成本大幅增加可能会产生负面影响 公司的收入、利润率、运营费用和运营运绩。虽然公司可能能够通过增加 燃油成本转嫁给客户，燃油附加费的增加可能会影响公司的收入和保留，如果长期存在 高燃料成本的情况发生。燃油成本显著增加，影响了公司的客户数量 选择乘坐飞机，可能会对公司的业务、财务状况和经营运绩产生重大不利影响。

如果 继续建立强大的品牌认同和提高会员满意度和忠诚度的努力并不成功，公司可能 无法吸引或留住会员，其经营运绩可能受到不利影响。

这个 公司必须继续为其产品和服务建立和保持强大的品牌认同感，这些产品和服务已经随著时间的推移而扩大。“公司”(The Company) 相信强大的品牌认同感将继续在吸引会员方面发挥重要作用。如果公司致力于推广和 维持自己的品牌都不成功，公司的经营业绩和我们吸引会员等客户的能力可能 受到不利影响。公司成员和其他客户可能会不时对其产品表示不满 和服务提供，部分原因可能是公司无法控制的因素，如时间和可用性 由当时的政治、监管或自然条件导致的飞机和服务中断。在一定程度上不满意 随著本公司产品和服务的普及或未得到充分解决，本公司的品牌可能会受到不利影响 它可能会受到影响，吸引和留住会员的能力可能会受到不利影响。关于公司的扩张计划 为了进入更多的市场，公司还需要建立自己的品牌，如果不成功，公司的 新市场的业务将受到不利影响。

任何 未能提供高质量的客户支持可能会损害公司与客户的关系，并可能会产生不利影响 公司的声誉、品牌、业务、财务状况和运营运绩。

穿过 公司的营销、广告和与客户的沟通，公司为其品牌定下了雄心勃勃的基调 但也触手可及。公司致力于通过提供的体验创造高水平的客户满意度 它的团队和代表。其产品的易用性和可靠性，包括提供高质量客户支持的能力， 帮助公司吸引和留住客户。该公司提供有效和及时支持的能力在很大程度上取决于 关于其吸引和留住能够支持公司客户并具有足够知识的熟练员工的能力 关于公司的产品和服务。随著公司业务的不断增长和平台的不断完善，公司将面临 在更大规模上提供高质量支持方面的挑战。未能提供有效的客户支持或市场 认为公司没有保持高质量的支持，可能会对公司的声誉、品牌、业务、 财务状况和经营结果。

的 对公司服务的需求受季节性波动的影响。

需求 该公司的服务将在一年中波动，夏季和假期期间更高。 在需求较高期间，公司向客户提供商定水平服务的能力可能会下降， 这可能会对公司的声誉及其成功能力产生负面影响。

变化 违反法律或法规，或未能遵守任何法律或法规，可能会对我们的业务、投资和业绩产生不利影响 的运营。

我们 受国家、地区和地府制定的法律法规的约束。该公司的业务受到重大 美国联盟航空局、运输安全管理局(TSA)的监管以及“了解你的客户”的义务和其他 法律法规。有关销售公司产品或服务的法律法规可能会发生变化，如果 那么，销售公司的产品或服务可能不再可能或不再有利可图。此外，我们还被要求 遵守某些美国证券交易委员会和其他法律要求。遵守和监测适用的法律和法规可能很困难， 既耗时又昂贵。这些法律和条例及其解释和适用也可能不时改变， 这些变化可能会对我们的业务、投资和运营结果产生实质性的不利影响。此外，未能 遵守解释和应用的适用法律或法规，可能会对我们的业务和我们的 手术的结果。

的 公司未来未能吸引和留住高素质人才可能会损害其业务。

的 公司相信其未来的成功在很大程度上取决于其保留或吸引高素质管理层、技术人员的能力 和其他人员。公司可能无法成功留住关键人员或吸引其他高素质人员。 如果公司无法留住或吸引大量合格的管理人员和其他人员，公司可能无法 能够发展和扩大其业务。

风险 与普通股所有权相关

的 公司从未对其股本支付现金股息，Jet.AI预计在可预见的未来也不会支付股息。

的 公司从未对其股本支付现金股息，目前打算保留任何未来收益来资助公司的增长 其业务，但优先股的强制股息支付除外，须遵守德拉瓦州法律。任何支付股息的决心 未来将由董事会自行决定，并取决于Jet.AI的财务状况、经营运绩、资本 要求、一般业务状况以及董事会可能认为相关的其他因素。因此，资本增值（如果有的话）， Jet.AI的普通股将成为可预见的未来的唯一收益来源。

的 公司的股价可能会波动，您可能无法以或高于您购买股份的价格出售股份 或实现您的逮捕令的任何价值。

波动 普通股价格的波动可能会导致您全部或部分投资的损失。如果我们的证券市场活跃 随著发展和持续，普通股的交易价格可能会波动，并因各种因素而大幅波动， 其中一些超出了我们的控制范围。

因素 影响我们普通股交易价格的可能包括：

广泛 无论我们的经营运绩如何，市场和行业因素都可能对我们证券的市场价格造成重大损害。股票 总体市场和纳斯达克都经历了价格和成交量波动，这些波动往往与 受影响的特定公司的经营运绩。这些股票以及我们证券的交易价格和估值， 可能无法预测。投资者对散户股票或其他公司股票市场失去信心 无论我们的业务、前景、财务状况或结果如何，被认为与Jet.AI相似都可能压低我们的股价 的运营。Jet.AI证券市场价格下跌也可能对其发行额外债券的能力产生不利影响 证券及其未来获得额外融资的能力。

反收购 公司注册证书和适用法律中包含的条款可能会损害收购尝试。

的 公司的注册证书赋予董事会某些可能导致延迟或预防的权利和权力 其认为不受欢迎的收购。上述任何具有拖延或威慑作用的规定和条款 控制权变更可能会限制股东获得我们证券股份溢价的机会，而且还可能 影响一些投资者愿意为我们的证券支付的价格。

如果 我们未能遵守纳斯达克的持续上市要求，我们将面临可能的退市，这将导致有限的 我们的股票公开市场，限制我们获得现有流动性设施的能力，并使获得未来融资变得更加困难 为我们

我们的 普通股目前在纳斯达克挂牌交易，交易代码为“JTAI”。2023年12月1日，公司收到了初步的 纳斯达克上市资格人员通知公司纳斯达克持股量 股本已跌破1,000美元的万最低股东权益要求。公司股东的 截至2023年12月31日的赤字为3963,039美元。最初的通知信还指出，截至2023年9月30日，公司 不符合纳斯达克全球市场另类上市标准的“市值”标准或“合计” 资产/总收入“标准。最初的通知函进一步指出，公司可能会考虑申请 将公司的证券转让给纳斯达克资本市场，这将要求公司除其他外 事物，符合纳斯达克持续上市的要求。2024年8月14日，纳斯达克听证会小组 批准公司将公司证券从纳斯达克全球市场转移到纳斯达克资本市场的请求，使其生效为 于2024年8月16日开盘。

在……上面 2024年4月14日，公司收到纳斯达克追加通知函(《第二通知函》) 声明本公司不符合纳斯达克上市规则第5450(A)(1)条，作为本公司 A类普通股已连续30个工作日低于1.00美元的最低投标价格要求。通知 违规行为不会立即影响公司普通股在纳斯达克的上市或交易。该公司拥有180家 日历日，或直到2024年10月14日，以重新遵守最低投标价格要求。要重新获得合规，最低限度 公司普通股的投标价格必须在至少连续十个工作日内达到或超过每股1.00美元 这是180天的宽限期。如果公司不能在10月前重新遵守最低投标价格要求 14,2024，公司可能有资格获得额外的180个日历天的合规期，因为它选择将 到纳斯达克资本市场。要获得资格，该公司将 须符合公开持股市值的持续上市要求及所有其他初始上市标准 对于纳斯达克资本市场，除投标价格要求外，将需要提供其意向书面通知 在第二个合规期内解决投标价格不足的问题。该公司在此期间未能重新获得合规 可能会导致退市。该公司打算积极监测其普通股的投标价格，并可能在适当的情况下考虑 实施可用的选项，以重新遵守最低投标价格要求。

2024年5月30日， 公司收到纳斯达克的额外通知信（「第三份通知信」），称 公司尚未重新遵守讨论的继续上市的最低股东权益要求 在初步通知信中，根据其合规计划，该公司必须在2024年5月29日之前提交该通知信。第三条通知 信函通知公司，除非公司要求在纳斯达克听证会小组（「小组」）举行上诉听证会 截至2024年6月6日，公司普通股将于2024年6月10日开业时暂停交易，并且 将向SEC提交表格25-NSO，SEC将取消该公司的证券的上市和注册 在纳斯达克（此类通知，「退市通知」）。

如中所述 在第三封通知函中，公司及时要求在陪审团面前举行听证会，并支付了适用的费用对退市提出上诉 注意。退市通知对本公司普通股的上市或交易并无即时影响。 本公司的听证请求暂停了本公司证券和本公司证券的交易 继续在纳斯达克上交易。2024年8月14日，为落实公司合规计划，纳斯达克 听证会小组批准了公司将公司证券从纳斯达克全球市场转移到 《纳斯达克资本市场》自2024年8月16日开盘之日起生效。进一步，纳斯达克听证会小组批准 该公司要求在2024年11月26日之前证明遵守其先前提交的计划，这是一个最后期限 该公司认为是可以实现的。公司正在努力纠正退市通知中列出的不足之处，并计划重新遵守 继续上市的要求在切实可行的范围内尽快实现。

虽然 该公司相信能够遵守纳斯达克的持续上市要求，但无法保证 公司将能够重新遵守所有适用要求或维持遵守任何其他上市要求 在纳斯达克要求的时间范围内或根本没有，特别是如果公司股价持续低于1.00美金， 期纳斯达克认定我们未能达到纳斯达克的持续上市标准可能会导致我们的证券 根据退市通知的规定，从纳斯达克退市。

一个 我们的普通股退市和我们无法在另一个国家证券市场上市可能会产生负面影响 美国：(1)降低我们普通股的流动资金和市场价格；(2)减少愿意 持有或收购我们的普通股，这可能对我们筹集股权融资的能力产生负面影响；(Iii)限制 我们使用某些注册声明提供和出售可自由交易的证券的能力，从而限制了我们访问 公共资本市场；以及(Iv)削弱我们向员工提供股权激励的能力。此外，退市的 我们的普通股将阻止我们能够根据股份购买协定获得融资。此外，本公司可 如果其股份不再持有，则必须以现金支付根据购股协定应支付的800,000美元承诺费的全部或部分 已列出。公司可能没有足够的资金来支付这样的费用。请参阅“管理层的讨论与分析 财务状况和经营结果--流动资金和资本资源。

股东 由于转换后发行额外普通股股份，其所有权权益可能会被稀释 b系列优先股，特别是由于b系列优先股的转换率波动，设定为 转换后立即期间我们普通股的市场价格。

我们 通过发行B系列优先股等证券，筹集了约1.5亿美元的万融资 在出售股东交易中，并可在认股权证行使时增发B系列优先股 最高可达1500万美元。B系列优先股的股票自动转换为我们普通股的股票，受某些条件限制 条件和限制，由10^日以90%的交易换算价发行后的交易日 我们普通股的价格，如果我们从纳斯达克退市，则为80%。请参阅“招股说明书摘要-出售股东 交易。“这可能会对公司现有股东造成实质性稀释。因为转换价格 是基于转换时我们普通股的交易价格，即B系列优先购买的股票数量 股票可以转换，可以增加，但没有上限。如果我们普通股的交易价格在转换时处于低位 如果可转换债券的价格确定，我们将被要求发行更多普通股以供出售 这可能会对我们的股东造成很大的稀释。此外，B系列赛的持有者优先 股票转换，然后出售我们的普通股，这可能会导致我们的普通股供需失衡和 大幅降低我们的股票价格。我们的股价跌得越多，转换价的调整幅度就越大。 而我们在转换时必须发行的普通股数量就越多，导致我们的 股东。因为基于市场价格的转换公式可能会导致股价大幅下跌和相应的负面影响 对公司及其股东的影响，可转换证券融资以市场价格为基础的转换比率俗称为 被称为“无地板”、“有毒”和“死亡螺旋”，敞篷车。

的 根据股份购买协议和GEm令状发行额外普通股可能会导致未来的稀释 Jet.AI股东并对普通股的市场价格产生负面影响。

的 业务合并、远期购买协议以及我们现有的现金和现金等值物的收益可能不足以 满足我们的流动资金需求，我们打算利用股份购买协议来满足我们的现金需求。此外，我们的估计可能 事实证明这是不准确的，我们的资本资源可以比目前预期更快地使用。此外，随著情况的变化，一些 其中可能超出了我们的控制范围，也可能导致我们支出资本的速度远远快于我们目前的预期，而且我们可能 需要比计划更早寻求额外资金。在这种情况下，可能会对公司的 股东。

在 除了提款后出售给GEm的股份外，股份购买协议还赋予GEm获得（i）承诺付款 以现金或普通股支付800，000美金的费用和（ii）GEm令状。根据GEm令状可发行的股份为 按业务合并结束时的完全稀释基础计算，其中计算包括行使后可发行的股份 当时尚未发行的JTAIW令、私募股权令、合并对价令、Jet Token期权和 Jet Token RSU奖。如果JTAIW令、私募令、合并对价令、Jet Token期权和/或 Jet Token RSU奖励并未全部或根本行使，而GEm行使GEm许可证，那么GEm持有的金额可能远多于 非稀释基础上占Jet.AI流通普通股的6%。

如果 Jet.AI普通股上市一周年后10个交易日的平均收盘价 低于GE令状当时当前行使价的90%，则GE令状的行使价可能会进行调整 降至我们当时当前交易价格的110%。

的 根据GEm令状和购股协议发行普通股将导致未来Jet.AI股东的稀释 并可能对普通股的市场价格和Jet.AI获得额外融资的能力产生负面影响。见「管理层的 财务状况和经营运绩的讨论和分析-流动性和资本资源-概述- 股份购买协议」了解对GEm令状的描述。

某些 现有股东以低于此类证券当前交易价格的价格购买了我们的证券，并且可能会经历积极的情况 基于当前交易价格的回报率。

给定 与当前交易相比，我们的一些股东为收购部分证券而支付的购买价格相对较低 根据我们普通股股票的价格，这些股东在某些情况下可能会获得正的投资回报率，这 可能是一个显著的正回报率，这取决于我们普通股股票当时的市场价格 选择出售他们的普通股股份。

公共 由于价格较低，股东可能无法体验到他们购买的证券相同的正回报率 我们的一些股东，特别是赞助商和Meteora，收购了我们普通股的股份或GEm可能收到的价格 根据股份购买协议提取时的股份。

销售 我们、我们的重要股东或公开市场上的出售股东对普通股的看法 或以其他方式可能导致普通股市场价格下跌，而出售股东可能会获得大量收益。

的 在公开市场或其他地方出售普通股股份，特别是发起人和我们的高级职员或董事的销售 禁售限制于2024年8月到期，或出售股东，或认为此类出售 可能发生，可能会损害我们普通股的现行市场价格。这些销售，或这些销售可能发生的可能性， 也可能使我们将来更难在认为合适的时间和价格出售股票证券。 即使我们的业务表现良好，普通股的转售也可能导致我们证券的市场价格大幅下跌。

Certain stockholders purchased or were issued securities at prices that may be significantly below the trading price of our Common Stock:

In connection with an extraordinary general meeting of Oxbridge shareholders in November 2022, in which Oxbridge asked its shareholders to vote to extend the date by which Oxbridge had to consummate a business combination, the holders of 10,313,048 Class A Ordinary Shares or approximately 90.0% of the shares with redemption rights at the time exercised their right to redeem their shares for cash at a redemption price of approximately $10.22 per share, for an aggregate redemption amount of $105,424,960. Subsequently, in connection with the Business Combination, holders of 1,144,215 of Oxbridge’s Class A Ordinary Shares, or approximately 96.4% of the shares with redemption rights at the time, exercised their right to redeem their shares for cash at a redemption price of approximately $11.10 per share, for an aggregate redemption amount of $12,655,017. On August 8, 2023, pursuant to the Forward Purchase Agreement, Meteora purchased 663,556 of the Class A Ordinary Shares from third parties through a broker in open market transactions or by reversing previously submitted redemption requests and waived its redemption rights with respect to these shares. Furthermore, Meteora purchased an additional 548,127 such shares.

We have an effective registration statement (SEC File No. 333-274432) covering the resale of up to 32,330,074 shares of Common Stock held by, or available upon exercise of warrants or other convertible securities by, certain of our stockholders, as well as the issuance by us of shares of Common Stock upon exercise of our outstanding warrants. Given the substantial number of shares of Common Stock registered for potential resale by these stockholders, the sale of shares by them, or the perception in the market that they intend to sell shares, could increase the volatility of the market price of our Common Stock or result in a significant decline in the public trading price of our Common Stock. Many of these stockholders have or may acquire their shares at a significant discount to the market price of our Common Stock. This will create an incentive for such stockholders to sell shares of our Common Stock because they purchased the shares at prices lower than the then-current trading price.

If securities or industry analysts do not publish or cease publishing research or reports about Jet.AI, its business or its market, or if they change their recommendations regarding the Common Stock adversely, the price and trading volume of the Common Stock could decline.

The trading market for the Common Stock will be influenced by the research and reports that industry or securities analysts may publish about Jet.AI, its business, its market or its competitors. If any of the analysts who may cover Jet.AI change their recommendation regarding the Common Stock adversely, or provide more favorable relative recommendations about its competitors, the price of the Common Stock would likely decline. If any analyst who may cover Jet.AI were to cease their coverage or fail to regularly publish reports on Jet.AI, we could lose visibility in the financial markets, which could cause the stock price or trading volume of Jet.AI securities to decline.

The JOBS Act permits “emerging growth companies” like us to take advantage of certain exemptions from various reporting requirements applicable to other public companies that are not emerging growth companies.

We qualify as an “emerging growth company” as defined in Section 2(a)(19) of the Securities Act, as modified by the JOBS Act. As such, we take advantage of certain exemptions from various reporting requirements applicable to other public companies that are not emerging growth companies, including (a) the exemption from the auditor attestation requirements with respect to internal control over financial reporting under Section 404 of the Sarbanes-Oxley Act, (b) the exemptions from say-on-pay, say-on-frequency and say-on-golden parachute voting requirements and (c) reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements. As a result, our stockholders may not have access to certain information they deem important. We will remain an emerging growth company until the earliest of (a) the last day of the fiscal year (i) following August 16, 2026, the fifth anniversary of our Initial Public Offering of units, which closed on August 16, 2021 (“IPO”), (ii) in which we have total annual gross revenue of at least $1.07 billion (as adjusted for inflation pursuant to SEC rules from time to time) or (iii) in which we are deemed to be a large accelerated filer, which means the market value of our the shares of Common Stock that are held by non-affiliates exceeds $700 million as of the last business day of our prior second fiscal quarter, and (b) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three year period.

In addition, Section 107 of the JOBS Act provides that an emerging growth company can take advantage of the exemption from complying with new or revised accounting standards provided in Section 7(a)(2)(B) of the Securities Act as long as we are an emerging growth company. An emerging growth company can therefore delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies, but any such election to opt out is irrevocable. We have elected not to opt out of such extended transition period, which means that when a standard is issued or revised and it has different application dates for public or private companies, we, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of our financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.

We cannot predict if investors will find our Common Stock less attractive because we will rely on these exemptions. If some investors find our Common Stock less attractive as a result, there may be a less active trading market for our Common Stock and our share price may be more volatile.

Risks Related to This Offering

The Selling Stockholder may choose to sell the Shares at prices below the current market price of our Common Stock.

The Selling Stockholder is not restricted as to the prices at which they may sell or otherwise dispose of the Shares covered by this prospectus. Sales or other dispositions of the Shares below the then-current market price of the Common Stock could adversely affect the market price of our Common Stock.

We will have broad discretion as to the proceeds that we receive from the cash exercise by any holder of the Warrant, and we may not use the proceeds effectively.

We will not receive any of the proceeds from the sale of the Shares by the Selling Stockholder pursuant to this prospectus. If we receive stockholder approval to increase the number of authorized shares of Common Stock and file an additional registration statement, we may receive up to approximately $15.0 million in aggregate gross proceeds from cash exercises of the Warrant, if any, and to the extent that we receive such proceeds, we intend to use the net proceeds from cash exercises of the Warrant for working capital and general corporate purposes. Our management will have broad discretion in the application of such proceeds, including for any of the purposes described in the section entitled “Use of Proceeds,” and we could spend the proceeds in ways our stockholders may not agree with or that do not yield a favorable return, if at all. You will not have the opportunity, as part of your investment decision, to assess whether such proceeds are being used in a manner agreeable to you. You will be relying on the judgment of our management concerning these uses and you will not have the opportunity, as part of your investment decision, to assess whether the proceeds are being used appropriately. The failure of our management to apply these funds effectively could result in unfavorable returns and uncertainty about our prospects, each of which could cause the price of our Common Stock to decline.

You may experience future dilution as a result of issuance of certain of the securities issued in connection with the Selling Stockholder Transaction, future equity offerings by us and other issuances of our Common Stock or other securities. In addition, the issuance of such securities and future equity offerings and other issuances of our Common Stock or other securities may adversely affect our Common Stock price.

The Shares will be freely tradable without restriction or further registration under the Securities Act. As a result, a substantial number of shares of our Common Stock may be sold in the public market following this offering. If there are significantly more shares of our Common Stock offered for sale than buyers are willing to purchase, then the market price of our Common Stock may decline to a market price at which buyers are willing to purchase the offered Common Stock and sellers remain willing to sell our Common Stock. The issuance of the Shares or any future sales of a substantial number of shares of our Common Stock in the public market, or the perception that such sales may occur, could also adversely affect the price of our Common Stock. We cannot predict the effect, if any, that market sales of those shares of Common Stock or the availability of those shares for sale will have on the market price of our Common Stock.

In addition, in order to raise additional capital, we may in the future offer additional shares of our Common Stock or other securities convertible into or exchangeable for our Common Stock at prices that may not be the same as the price per share as prior issuances of Common Stock. We may not be able to sell shares or other securities in any other offering at a price per share that is equal to or greater than the price per share previously paid by investors, and investors purchasing shares or other securities in the future could have rights superior to existing stockholders. The price per share at which we sell additional shares of our Common Stock or securities convertible into Common Stock in future transactions may be higher or lower than the prices per share. In addition, the exercise price of the Warrant for the Warrant Shares may be lesser or greater than the price per share previously paid by certain investors. You will incur dilution upon exercise of any outstanding stock options, warrants or upon the issuance of shares of Common Stock under our stock incentive programs. In addition, the issuance of the Shares and any future sales of a substantial number of shares of our Common Stock in the public market, or the perception that such sales may occur, could adversely affect the price of our Common Stock. We cannot predict the effect, if any, that market sales of those shares of Common Stock or the availability of those shares for sale will have on the market price of our Common Stock.

Neither we nor the Selling Stockholder have authorized any other party to provide you with information concerning us or this offering.

You should carefully evaluate all of the information in this prospectus and the registration statement of which this prospectus forms a part. We may receive media coverage regarding our Company, including coverage that is not directly attributable to statements made by our officers, that incorrectly reports on statements made by our officers or employees, or that is misleading as a result of omitting information provided by us, our officers or employees. Neither we nor the Selling Stockholder have authorized any other party to provide you with information concerning us or this offering of Shares, and such recipients should not rely on this information.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This prospectus includes forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. We have based these forward-looking statements on our current expectations and projections about future events. All statements, other than statements of present or historical fact included in this prospectus, regarding the proposed the Company’s future financial performance and the Company’s strategy, expansion plans, future operations, future operating results, estimated revenues, losses, projected costs, prospects, plans and objectives of management are forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may,” “should,” “could,” “would,” “expect,” “plan,” “anticipate,” “intend,” “believe,” “estimate,” “continue,” “project,” “strive,” “might,” “possible,” “potential,” “predict” or the negative of such terms or other similar expressions, but the absence of these words does not mean that a statement is not forward-looking. These forward-looking statements are subject to known and unknown risks, uncertainties and assumptions about Jet.AI that may cause Jet.AI’s actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. Except as otherwise required by applicable law, the Company disclaims any duty to update any forward-looking statements, all of which are expressly qualified by the statements in this section, to reflect events or circumstances after the date of this prospectus. The Company cautions you that these forward-looking statements are subject to numerous risks and uncertainties, most of which are difficult to predict and many of which are beyond the control of the Company.

In addition, the Company cautions you that the forward-looking statements regarding the Company, which are included in this prospectus, are subject to the following factors:

Should one or more of the risks or uncertainties described in this prospectus and in any document incorporated by reference in this prospectus materialize, or should underlying assumptions prove incorrect, actual results and plans could differ materially from those expressed in any forward-looking statements.

You should read this prospectus with the understanding that our actual future results may be materially different from what we expect. We do not assume any obligation to update any forward-looking statements whether as a result of new information, future events or otherwise, except as required by applicable law.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL

CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis provides information which Jet.AI’s management believes is relevant to an assessment and understanding of its consolidated results of operations and financial condition. You should read the following discussion and analysis of Jet.AI’s financial condition and results of operations together with Jet.AI’s consolidated financial statements, and the related notes that are included elsewhere in this prospectus.

Certain of the information contained in this discussion and analysis or set forth elsewhere in this prospectus, including information with respect to plans and strategy for Jet.AI’s business, includes forward-looking statements that involve risks and uncertainties. As a result of many factors, including those factors set forth in the section entitled “Risk Factors,” Jet.AI’s actual results could differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis. Factors that could cause or contribute to such differences include, but are not limited to, capital expenditures, economic and competitive conditions, regulatory changes and other uncertainties, as well as those factors discussed below and elsewhere in this prospectus. We assume no obligation to update any of these forward-looking statements. Please also see the section entitled “Cautionary Note Regarding Forward-Looking Statements.”

Percentage amounts included in this prospectus have not in all cases been calculated on the basis of such rounded figures, but on the basis of such amounts prior to rounding. For this reason, percentage amounts in this prospectus may vary from those obtained by performing the same calculations using the figures in the consolidated financial statements included elsewhere in this prospectus. Certain other amounts that appear in this prospectus may not sum due to rounding.

Overview

Jet.AI, a Delaware corporation, was founded in 2018 by Michael Winston, its Executive Chairman. The Company, directly and indirectly through its subsidiaries, has been principally involved in (i) the sale of fractional and whole interests in aircraft, (ii) the sale of jet cards, which enable holders to use certain of the Company’s and other’s aircraft at agreed-upon rates, (iii) the operation of a proprietary booking platform, which functions as a prospecting and quoting platform to arrange private jet travel with third party carriers as well as via the Company’s leased and managed aircraft, (iv) direct chartering of its HondaJet aircraft by Cirrus, (v) aircraft brokerage, and (vi) service revenue from the monthly management and hourly operation of customer aircraft.

Beginning in December 2023, we launched our Jet.AI Operator Platform to provide a B2B software platform for SaaS products. Currently we offer the following SaaS software to aircraft owners and operators generally:

Business Combination

On August 10, 2023, Oxbridge, consummated a business combination pursuant to the Business Combination Agreement among Oxbridge, the Merger Subs and Jet Token. Pursuant to the Business Combination Agreement, Oxbridge redomiciled as a Delaware corporation and was immediately renamed Jet.AI, Inc., and promptly thereafter, (a) First Merger Sub merged with and into Jet Token with Jet Token surviving the merger as a wholly owned subsidiary of Jet.AI Inc.; and (b) Jet Token merged with and into Second Merger Sub (each merger and all other transactions contemplated by the Business Combination Agreement, the “Business Combination”).

As a result of the Business Combination:

As a result of the Business Combination, Jet.AI Inc. has one class of Common Stock listed on Nasdaq under the ticker symbol “JTAI”, and had two classes of warrants, the Jet.AI Warrants and the Merger Consideration Warrants, listed on Nasdaq under the ticker symbols “JTAIW” and “JTAIZ” respectively.

The Business Combination was accounted for as a reverse recapitalization in accordance with GAAP, whereby Oxbridge is treated as the acquired company and Jet Token is treated as the acquirer (the “Reverse Recapitalization”). Accordingly, for accounting purposes, the Reverse Recapitalization was treated as the equivalent of Jet Token issuing stock for the net assets of Oxbridge, accompanied by a recapitalization. The net assets of Oxbridge were stated at historical cost, with no goodwill or other intangible assets recorded.

The consolidated assets, liabilities, and results of operations prior to the Reverse Recapitalization are those of Jet Token. The shares and corresponding capital amounts and losses per share, prior to the Reverse Recapitalization, have been retroactively restated based on shares reflecting the exchange ratio established in the Business Combination.

References in this MD&A to “Jet.AI” or “the Company” refer to Jet Token Inc. prior to the consummation of the Business Combination.

Results of Operations

The following table sets forth our results of operations for the periods indicated:

Three Months Ended June 30, 2024 and 2023

Revenues

Revenues for the second quarter of 2024 totaled approximately $3.1 million, a $0.3 million increase from $2.8 million during the comparable period in 2023, which consisted of $914,000 in services revenue from the management of customers’ aircraft, $657,000 in software-related revenue, $559,000 in Jet Card revenue for hours flown and other charges based on hours flown, and $954,000 in revenue from the chartering of our HondaJets by our operating partner Cirrus.

The primary reason for this increase in revenue was due to additional service revenue of $500,000 arising from an additional management agreement for customer aircraft in the second quarter of 2024 and increased chartering of the Company’s Citation CJ4, offset by a $253,000 reduction in software revenue due to seasonality and the resulting reduced flying by the Company’s Jet Card holders and ad hoc charter clients.

The following table sets forth a breakout of revenue components by subcategory for the three months ended June 30, 2024 and 2023.

The Company recognized $657,000 in revenue related to App-generated services and software revenues related to charter bookings made through its App in the second quarter of 2024, a decrease of $195,000 compared to the 2023 period and primarily reflected seasonality and a shift in Spring-related charters from April to March. This compares to software revenues totaling $852,000 in the 2023 period.

During the second quarter of 2024, the Company sold 55 prepaid flight hours under its jet card and fractional programs, amounting to $319,000, and recognized $616,000 of revenue for 87 flight hours flown or forfeited, as well as additional charges. These additional charges primarily represent charges for cost reimbursements such as a fuel component adjustment to adjust for changes in fuel prices relative to the jet card and fractional contracts’ base fuel price and reimbursement of federal excise taxes. Prepaid flight hours are recognized as revenue as the flight hours are used or forfeited. On June 30, 2024, the Company had recorded deferred revenue of $1.1 million on its consolidated balance sheets representing prepaid flight hours for which the related travel had not yet occurred.

In the second quarter of 2023, the Company sold 122 prepaid flight hours, amounting to $713,000, and recognized $709,000 of revenue for 113 flight hours flown or forfeited, as well as additional charges.

The decrease in flight hours flown period over period is a direct result of a reduction in flying by the Company’s Jet Card holders during this period.

The following table details the flight hours sold and flown or forfeited, as well as the associated deferred revenues and recognized revenues, respectively, and additional charges for the second quarter of 2024 and 2023:

In addition to its software App and jet card revenues, the Company also generates revenue through the direct chartering of its HondaJet and Citation CJ4 aircraft by Cirrus. During the second quarter of 2024 this revenue amounted to approximately $954,000, an increase of $247,000, or 34.9% from the second quarter of 2023. The increased revenue was a direct result of increased availability and chartering of the managed Citation CJ4.

Cost of revenues

Our cost of revenue is comprised of payments to Cirrus Aviation for the maintenance and management of our fleet aircraft, commissions to Cirrus for their arranging for charters on our aircraft, aircraft lease expense, federal excise tax relating to jet card and third-party charters, and payments to third -party aircraft operators for both charter flights booked through our App, as well as the cost of subcharters for covering jet card flights when our HondaJets were unavailable. The management of our aircraft by Cirrus covers all our aircraft regardless of whether the aircraft are used for program flight hours or charter flights and includes expenses such as fuel, pilot wages and training costs, aircraft insurance, maintenance and other flight operational expenses.

In the second quarter of 2024, the Company operated 3 HondaJets, 1 CJ4 and, in addition to the CJ4, managed a King Air 350i.

As a result, the increased Cirrus charter flight activity, costs related to the operation of these aircraft and payments to Cirrus for their management increased $0.7 million from $1.6 million in the second quarter of 2023 to $2.3 million in the second quarter of 2024, and aircraft lease payments increased $31,000 from $346,000 in the second quarter of 2023 to $377,000 in 2024. The Company also incurred third-party charter costs of approximately $623,000 in the second quarter of 2024, a $380,000 decrease over 2023, reflecting the reduction in the number of App-generated charter bookings and a decrease in the number of subcharters required. Merchant fees and federal excise tax relating to charter flights of $249,000 in the second quarter of 2024 were a $157,000 increase as compared to $92,000 in the second quarter of 2023 as a result of increased charter activity.

In total, it cost $3.5 million to operate five aircraft in the second quarter of 2024, compared to $3.0 million to operate four aircraft in the second quarter of 2023.

Gross loss

The resulting gross loss totaled approximately $417,000 for the second quarter of 2024, compared to $201,000 for the second quarter of 2023. The gross loss in the second quarter of 2024 was largely driven by reduced flights performed for our jet card customers without a corresponding reduction in fixed costs.

Total Operating Expenses

In the second quarter of 2024, the Company’s operating expenses increased by approximately $556,000 over the prior year period primarily due to an approximate $548,000 increase in general and administrative expenses, $9,000 increase in research and development costs and slightly lower sales and marketing expenses. Excluding non-cash stock-based compensation of $1.2 million and $1.3 million in the second quarter of 2024 and 2023, respectively, general and administrative expenses rose by approximately $694,000 primarily due to an increase in professional service expenses of $364,000 resulting primarily from increased legal expenses of $319,000 relating to the Company’s SEC filings and transactions the Company pursued during the quarter and $41,000 in payments to our Board of Directors, as well as increased wages of $294,000, primarily due to increased headcount.

The Company’s sales and marketing expenses declined by about $2,000 to $102,000 in the second quarter of 2024 from $104,000 in the second quarter of 2023, as the Company continued its sales and marketing spending for its jet card inventory and charter app. These expenses are mainly linked to promoting the Company and its programs.

Research and development expenses increased $9,000 to $37,000 in the second quarter of 2024 from $28,000 in the second quarter of 2023, due to continuing refinement of the App, as well as continued development work on additional software offerings.

Operating Loss

As a result of all of the above, in the second quarter of 2024 the Company recognized an operating loss of approximately $3.2 million, which was an increase in loss of approximately $0.8 million. The increase in operating loss was primarily due to the increase in general and administrative expenses resulting from the increase in professional service expenses and wages following the Business Combination.

Other (Income) Expense

During the second quarter of 2024, the Company recognized approximately $59 in interest income. There were no such other income or expenses in the second quarter of 2023.

Six Months Ended June 30, 2024 and 2023

Revenues

Revenues for the first six months of 2024 totaled approximately $6.9 million, a $2.3 million increase from revenues of approximately $4.7 million during the 2023 period, primarily related to increases in Software App and Cirrus Charter revenue, as well as increased Management and Other Services revenue of $1.4 million and $0.9 million, respectively. Revenues in the 2024 period were comprised of $1.7 million in services revenue from the management of customers’ aircraft, $2.3 million in software-related revenue, $1.2 million in Jet Card revenue for hours flown and other charges based on hours flown and $1.6 million in revenue from the chartering of our HondaJets and Citation CJ4 by our operating partner Cirrus.

The following table sets forth a breakout of revenue components by subcategory for the six months ended June 30, 2024 and 2023.

The Company began recognizing revenue in September 2020 reflecting services and software revenues related to charter bookings made through its App and in the first six months of 2023, the Company recognized $1.3 million in revenue related to App-generated charter bookings. During the 2024 period these revenues totaled $2.3 million, a $1.0 million or 71.8% increase from 2023 reflecting additional brokerage staff, increased marketing and greater awareness of the Company.

The Company recognized $1.7 million in service revenue in the first six months of 2024, an increase of $0.9 million, relating to an agreement entered into during the fourth quarter of 2023 to manage a customer’s aircraft, as well as a second managed aircraft beginning in April 2024. There was $0.8 million in service revenues in the first six months of 2023.

During the first six months of 2024, the Company sold 110 prepaid flight hours under its jet card and fractional programs, amounting to $0.7 million, and recognized $1.2 million of revenue for 182 flight hours flown or forfeited, as well as additional charges. These additional charges represent primarily charges for cost reimbursements such as a fuel component adjustment to adjust for changes in fuel prices relative to the jet card and fractional contracts’ base fuel price and reimbursement of federal excise taxes. Prepaid flight hours are recognized as revenue as the flight hours are used or forfeited. On June 30, 2024, the Company recorded deferred revenue of $1.1 million on its consolidated balance sheets, which represents prepaid flight hours for which the related travel had not yet occurred.

In the first six months of 2023, we sold 261 prepaid flight hours amounting to approximately $1.4 million and recognized approximately $1.4 million of revenue for 210 flight hours flown or forfeited, as well as additional charges.

The increase in flight hours flown is a direct result of the increased number of aircraft.

The following table details the flight hours sold and flown or forfeited, as well as the associated deferred revenues and recognized revenues, respectively, and additional charges for the first six months of 2024 and 2023:

During the first six months of 2024 revenue generated through the direct chartering of the Company’s HondaJet and Citation CJ4 aircraft by Cirrus amounted to approximately $1.6 million, an increase of $0.4 million, or 37.8% from the prior year. The increased revenue was a direct result of increased charter activity, both ad hoc and by Cirrus, as well as the addition of the managed Citation CJ4 and King Air 350i.

Cost of revenues

Our cost of revenue is comprised of payments to Cirrus for the maintenance and management of our fleet aircraft, commissions to Cirrus for their arranging for charters on our aircraft, aircraft lease expense, federal excise tax relating to jet card and second-party charters, and payments to second-party aircraft operators for both charter flights booked through our App, as well as the cost of subcharters for covering jet card flights when our HondaJets were unavailable. The management of our aircraft by Cirrus covers all our aircraft regardless of whether the aircraft are used for program flight hours or charters and includes expenses such as fuel, pilot wages and training costs, aircraft insurance, maintenance and other flight operational expenses.

As a result of the increased ad hoc and Cirrus charter flight activity, as well as the startup expenses relating to the introduction of the King Air 350i managed aircraft to its fleet, operating expenses related to the operation of the Company’s aircraft and payments to Cirrus for their management increased $1.6 million from $2.8 million in the first six months of 2023 to $4.4 million in 2024 and aircraft lease payments increased $151,000 from $544,000 in 2023 to $695,000 in the first six months of 2024. The Company also incurred third-party charter costs of approximately $2.0 million in the first six months of 2024, a $0.5 million increase over 2023, in order to fulfill a greater number of App-generated charter bookings, as well as subcharters used for covering jet card flights when our HondaJets were unavailable. Federal excise tax and merchant fees relating to charter flights increased $250,000 in the first six months of 2024 to $409,000 from $159,000 in 2023.

In total, it cost $7.5 million to operate the Company’s 6 aircraft in the first six months of 2024, compared to $4.9 million during the 2023 period for 5 aircraft.

Gross loss

The resulting gross loss totaled $541,000 for the first six months of 2024, compared to $276,000 for the 2023 period. The increased gross loss in these operations was a result of increased maintenance costs, together with lower utilization on our HondaJets.

Total Operating Expenses

In the first six months of 2024, the Company’s operating expenses increased $0.9 million due to a $0.6 million increase in general and administrative expenses, $325,000 in higher sales and marketing expenses, and $5,000 in higher research and development costs. Excluding non-cash stock-based compensation of $2.4 million and $2.8 million in the first six months of 2024 and 2023, respectively, general and administrative expenses rose by approximately $1.0 million primarily due to due to an increase in professional service expenses of $280,000 related to our software development and legal expenses relating to the Company’s SEC filings and various transactions the Company closed or pursued, $117,000 in payments to our Board of Directors and increased wages of $450,000, primarily due to increased commissions compensation payable on charter sales, as well as a greater number of software developers in 2024.

The Company’s sales and marketing expenses increased by about $325,000 to $549,000 in the first six months of 2024 from $224,000 in 2023, as it reaccelerated its sales and marketing spending for software and jet card sales. These expenses are mainly linked to promoting the Company and its programs.

Research and development expenses increased approximately $5,000 to $70,000 in the first six months of 2024 from $65,000 in the comparable 2023 period, due to continuing refinement of the App, as well as some initial development work on additional software offerings.

Operating Loss

As a result of all of the above, in the first six months of 2024 the Company recognized an operating loss of approximately $6.4 million, which was an increase in loss of nearly $1.2 million compared to the comparable 2023 period. The increase was primarily due to reduced gross profits of $0.3 million, as well as a $0.6 million increase in general and administrative expenses.

Other (Income) Expense

During the first six months of 2024, the Company recognized approximately $79,000 in other expense due primarily to interest expense related to the Company’s Bridge Agreement, compared to no other income or expense recorded for the first six months of 2023.

Liquidity and Capital Resources

Overview

As of June 30, 2024, the Company’s cash and equivalents were $528,117, including $500,000 of restricted cash under its aircraft leasing arrangements, as described below. As of June 30, 2024, current liabilities exceeded current assets by approximately $3.9 million, of which $1.1 million in liabilities represents deferred revenue that would be recorded as revenue once the flight hours are flown or forfeited.

During the six month period ended June 30, 2024, the Company raised (1) approximately $1,727,000 in funds from the issuance of 3,200,000 shares of common stock under the Share Purchase Agreement discussed below, as well as $1,500,000 related to the sale of 150 shares of preferred stock, and (2) approximately $742,000 from Jet.AI Warrant exercises.

The Company also incurred negative cash flows from operating activities and significant losses from operations in the past as reflected in its accumulated deficit of approximately $45.7 million as of June 30, 2024. While we expect to drive revenue and operating profit growth from aircraft acquisitions, higher average hourly pricing of jet cards, increased charter activity through CharterGPT and Reroute AI and SaaS revenues from DynoFlight, we expect to continue to incur operating losses to a greater or lesser extent for at least the next 12 months, depending on the timing and success of these initiatives. To bridge the gap, we intend to rely on funds available from share issuances under the Share Purchase Agreement and amounts received upon an exercise of the Warrant, if any, to meet our funding obligations. Additional funding under the Share Purchase Agreement may be limited contractually and the Warrant may not be exercised by the holder. Furthermore, issuances of additional shares of common stock under the Share Purchase Agreement or upon conversion of the Series B Preferred Stock outstanding and underlying the Warrant may negatively impact the Company’s stock price and ability to raise additional funds. We will likely require additional capital resources to grow our business. In the absence of external financing the Company is prepared to cut its cash utilization by ceasing marketing and customer acquisition, suspending software development, streamlining operations, and servicing only existing customers. Such a reduction would allow the Company to continue to operate for a year or more by management’s estimate. During that time the Company would plan to arrange new financing and to then resume expansion.

Selling Stockholder Transaction

General

On March 28, 2024, Company entered into the Securities Purchase Agreement and certain other transaction documents described below with the Selling Stockholder, in connection with a private placement which closed on March 29, 2024 (the “Closing Date”). Under the Securities Purchase Agreement, the Company agreed to issue to the Selling Stockholder (a) 150 shares of Series B Preferred Stock, which are convertible into shares of Common Stock, (b) the Warrant to purchase up to 1,500 shares of Series B Preferred Stock at an exercise price of $10,000 per share, and (c) 250,000 shares of Common Stock.

The Company received gross proceeds of approximately $1.5 million, not including customary placement fees and reimbursement of certain payables to Maxim Group LLC as placement agent and other expenses payable by the Company, in connection with the Selling Stockholder Transaction. This amount excludes the proceeds, if any, from the exercise of the Warrant. The Company intends to use the remainder of the net proceeds for working capital, capital expenditures, product development, and other general corporate purposes. The Company has not allocated specific amounts of net proceeds for any of these purposes.

Series B Preferred Stock

On March 28, 2024, we filed a Certificate of Designations of the Series B Convertible Preferred Stock with the Secretary of State of the State of Delaware, which provides for the issuance of up to 5,000 shares of the Company’s Series B Preferred Stock. The Series B Preferred Stock ranks pari passu with the Series A Preferred Shares and Series A-1 Preferred Shares and senior to all other capital stock of the Company.

Each share of Series B Preferred Stock converts into a number of shares of our common stock, subject to certain limitations, including a beneficial ownership limitation of 4.99% (calculated in accordance with the rules promulgated under Section 13(d) of the Securities Exchange Act of 1934), which can be adjusted to a beneficial ownership limitation of 9.99% upon 61 days prior written notice by the Selling Stockholder. From time to time the Selling Stockholder may convert Series B Preferred Stock into Common Stock which it may liquidate and thereafter receive additional shares of Common Stock pursuant to subsequent conversions of its Series B Preferred Stock. Although the beneficial ownership limitation imposes a legally binding limitation on the Selling Stockholder’s beneficial ownership at any point in time, it does not prohibit the Selling Stockholder from, over time, receiving shares of Common Stock upon separate conversions of its shares of Series B Preferred Stock that, in the aggregate and over a period of time, exceed the beneficial ownership limitation.

Subject to the limitations set forth in the preceding paragraph and provided there is an effective registration statement covering Selling Stockholder’s potential resale of common stock underlying the Series B Preferred Stock, shares of Series B Preferred Stock will automatically convert into shares of common stock on or prior to the tenth trading day after the issuance date of such shares of Series B Preferred Stock. The number of shares of common stock issuable upon conversion of a share of Series B Preferred Stock is calculated by dividing the conversion amount per share of Series B Preferred Stock by the then conversion price. The conversion amount is equal to the stated value of the shares of Series B Preferred Stock, which is $10,000, plus any additional amounts and late charges calculated in accordance with the Certificate of Designations. The conversion price is equal to 90% (or, in the case of a delisting, 80%) of the lowest daily volume weighted average price of our common stock over a period beginning on the trading day after we deliver shares of common stock upon such conversion to Selling Stockholder and ending on the trading day on which the aggregate dollar trading volume of our common stock exceeds seven times the applicable conversion amount, subject to a five trading day minimum period for such calculation, and subject to certain adjustments.

If certain defined “triggering events” defined in the Certificate of Designations occur, such as a breach of the Registration Rights Agreement, suspension of trading, or our failure to convert the Series B Preferred Stock into common stock when a conversion right is exercised, then we may be required to redeem the Series B Preferred Stock for cash at 110% of the stated value.

Other Transaction Documents

The Warrant exercise price is initially set at $10,000 per share of Series B Preferred Stock, subject to adjustment for certain events, such as a stock split, issuance of additional shares as a dividend or otherwise. If the entirety of the Warrant was exercised for cash, the Company would receive additional gross proceeds of approximately $15.0 million. The Company cannot predict when or if the Warrant will be exercised. It is possible that the Warrant may never be exercised. At any time when the Warrant is exercisable for less than 1,000 shares of Series B Preferred Stock, the Company has the right to redeem all or a portion of the Warrant by paying to the Selling Stockholder in cash $100 per share of Series B Preferred Stock that would otherwise be issuable pursuant to the Warrant.

The Securities Purchase Agreement contains customary representations and warranties of the Company, on the one hand, and the Selling Stockholder, on the other hand, and customary conditions to closing. Pursuant to the Securities Purchase Agreement, the Company agreed to submit to its stockholders a proposal to approve the issuance of shares of Common Stock issuable upon exercise of the shares of Series B Preferred Stock in accordance with Nasdaq Rules at a special meeting of stockholders at the earliest practicable date after the date of the Securities Purchase Agreement, but in no event later than ninety (90) days after the Closing Date. The Company entered into a voting agreement (the “Voting Agreement”) with Michael Winston, the Company’s Interim Chief Executive Officer, and the Sponsor, who together hold approximately 43.6% of the voting power of the Company as of the date of this prospectus, agreeing to vote in favor of the proposal. At its annual meeting of stockholders, which took place on September 24, 2024, the Company sought stockholder approval for the potential issuance of shares of common stock pursuant to the Selling Stockholder Transaction in an amount that, upon issuance, could result in the issuance of shares of common stock in an amount in excess of 20% of the Company’s outstanding shares of common stock at a price less than the “minimum price” as defined by and in accordance with Nasdaq Listing Rule 5635(d). The Company’s stockholders approved such potential issuance at the annual meeting. The Securities Purchase Agreement obligates the Company to reserve no less than 200% of the maximum number of shares of Common Stock issuable upon conversion of the Series B Preferred Stock outstanding, using an alternate conversion method (the “Required Reserve Amount”). The Company and the Selling Stockholder have agreed that the Company Required Reserve Amount is 45,000,000 shares of Common Stock. In order to meet that obligation, the Company sought stockholder approval to amend its certificate of incorporation to increase the number of authorized shares of Common Stock to 200,000,000 at its annual meeting of stockholders. The Company received such approval on September 24, 2024.

Additionally, on March 29, 2024, the Company entered into the Registration Rights Agreement with the Selling Stockholder, which, among other things, provides that the Company will register the resale of the 250,000 shares of Common Stock and the shares of Common Stock issuable upon conversion of the Series B Preferred Stock, including the Series B Preferred Stock issuable upon exercise of the Warrant. The Company is required to prepare and file a registration statement with the SEC no later than 30 days following the filing of the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 (the “Form 10-K”), but in no event later than May 15, 2024 (the “Filing Failure”, and such deadline, the “Filing Deadline”), and to use its commercially reasonable efforts to have the registration statement and any amendment declared effective no later than the earlier of the (a) 60th calendar day following such the filing of the Form 10-K (or, if such registration statement is subject to a full review by the SEC, the 100th calendar day after such filing) and (b) 2nd business day after the date the Company is notified (orally or in writing, whichever is earlier) by the SEC that such registration statement will not be reviewed or will not be subject to further review (the “Effectiveness Deadline”). The Company filed a registration statement on Form S-1 pursuant to the foregoing obligation. In addition, because this registration statement was not declared effective by the SEC by the Effectiveness Deadline, the Company was obligated to pay the Selling Stockholder a $100,000 Effectiveness Fee. The Company issued to the Selling Stockholder 100,000 Effectiveness Shares in lieu of paying the Effectiveness Fee in cash.

Share Purchase Agreement

The Company has access to an aggregate of up to $40 million from the Share Purchase Agreement, dated as of August 4, 2022, with GEM Yield LLC SCS and GEM Yield Bahamas Limited (together with GEM Yield LLC SCS, “GEM”), less drawdowns of $1,110,000 to date. In consideration for GEM’s services under the Share Purchase Agreement, the Company has agreed to pay GEM a commitment fee equal to $800,000 payable in cash or freely tradable shares of common stock, at the option of the Company. Upon the Company’s issuance of shares in connection with any drawdown purchase made by GEM, the Company is required to pay GEM a portion of such commitment fee in an amount equal to 2% of the amount purchased in such drawdown; provided that the full $800,000 commitment fee is due on or before the first anniversary of the closing of the Business Combination.

GEM is not obligated to purchase shares under the Share Purchase Agreement if any purchase of shares would result in GEM and its affiliates beneficially owning, directly or indirectly, at the time of the proposed issuance, more than 9.99% of the number of issued and outstanding shares of common stock as of the date of such proposed issuance. GEM may waive the restriction under the Share Purchase Agreement by providing the Company with sixty-one (61) days’ notice that the Purchaser would like to waive the restriction with regard to any or all shares issuable pursuant to the Share Purchase Agreement.

On August 10, 2023, the Company issued GEM a warrant (as subsequently amended, the “GEM Warrant”) granting it the right to purchase up to 6% of the outstanding common stock of the Company on a fully diluted basis as of the date of listing. The GEM Warrant has a term of three years. The exercise price of the GEM Warrant, as of March 31, 2024, was $5.81 per share; provided, that, if the average closing price of Jet.AI’s common stock for the 10 trading days following the first anniversary of the date of listing is less than 90% of the then current exercise price of the GEM Warrant, then the exercise price of the GEM Warrant will be adjusted to 110% of our then current trading price. The warrant may be exercised by payment of the per share amount in cash or through a cashless exercise.

The GEM Warrant provides that GEM can elect to limit the exercisability of the GEM Warrant such that it is not exercisable to the extent that, after giving effect to the exercise, GEM and its affiliates, to the Company’s actual knowledge, would beneficially own in excess of 4.99% of Jet.AI’s common stock outstanding immediately after giving effect to such exercise. GEM has made this election, which makes funds available under the Share Purchase Agreement in excess of this 4.99% ownership limit up to the 9.99% ownership restriction in the Share Purchase Agreement. GEM may revoke this election by providing written notice, which revocation will not be effective until the sixty-first (61st) day thereafter.

Bridge Agreement

On September 11, 2023, the Company entered into a binding term sheet (“Bridge Agreement”) with eight investors to provide the Company $500,000 of short-term bridge financing pending its receipt of funds from its other existing financing arrangements.

As of December 31, 2023, the Bridge Agreement provided for the issuance of Notes, in an aggregate principal amount of $625,000, reflecting a 20% original issue discount. The Notes bore interest at 5% per annum and matured on March 11, 2024. The Company was required to redeem the Notes with 100% of the proceeds of any equity or debt financing at a redemption premium of 110% of the principal amount of the Notes. In March 2024, the Company fully repaid the Bridge Agreement in the amount of approximately $683,000, representing principal, redemption premium and interest.

Other Equity Issuances and Settlement Arrangements

Maxim Payment and Settlement Agreement

On August 10, 2023, the Company entered into a settlement agreement (“Maxim Settlement Agreement”) with Maxim Group LLC, the underwriter for the Company’s initial public offering (“Maxim”). Pursuant to the Maxim Settlement Agreement, the Company issued to Maxim Partners (a) 270,000 shares of common stock to Maxim Partners to settle the payment obligations of the Company under the underwriting agreement dated on or about August 11, 2021, by and between the Company and Maxim and (b) 1,127 Series A Preferred Shares to Maxim Partners in an amount equal in value to $1,127,000. The Series A Preferred Shares accrue a dividend at the rate of 8% per annum (which increases to 18% if the Company fails to meet certain obligations under the terms thereof), payable quarterly and, at the Company’s option, in shares of common stock. The Series A Preferred Shares are convertible into 112,700 shares of common stock. The Company also issued 115,000 shares of common stock to Maxim Partners on August 16, 2021 to meet a payment obligation under the underwriting agreement in connection with Oxbridge’s IPO, representing a value of $9.00 per share reflecting an allocation of the $10.00 per Unit IPO price. The above issued and issuable shares of common stock are subject to a registration rights agreement.

The Company may, subject to certain conditions, redeem the outstanding Series A Preferred Shares in cash at the $1,000 original issue price, subject to adjustment, plus accrued and unpaid dividends. The Company is required to redeem all the outstanding Series A Preferred Shares on August 10, 2024, which will be automatically extended by an additional three (3) month period if the Company has not, as of such date, closed upon one or more equity financings that, in total, result in gross proceeds to the Company of $10.0 million or greater (which amount has not been achieved as of the date of this report). If the Company raises equity capital, 15% of the net proceeds will be used to redeem the Series A Preferred Shares if requested by the holder.

In July 2024, the Company and Maxim entered into an amendment to the Maxim Settlement Agreement and agreed to, among other things, amend the definition of the “Series A Conversion Price” for the Series A Preferred Shares and certain restrictions with respect to shares of Company common stock Maxim may acquire upon the conversion of its Series A Preferred Shares.

Sponsor Settlement Agreement

On August 10, 2023, the Company entered into settlement agreement (“Sponsor Settlement Agreement”) with the Sponsor. Pursuant to the Sponsor Settlement Agreement, the Company issued 575 Series A-1 Preferred Shares to settle the payment obligations of the Company under a promissory note in the principal amount of $575,000 dated November 14, 2022 in favor of the Sponsor. The Series A-1 Preferred Shares accrue interest at the rate of 5% per annum (which increases to 18% if the Company fails to meet certain obligations under the terms thereof), payable quarterly in cash. The Series A-1 Preferred Shares are convertible into 57,500 shares of common stock.

The Company may, subject to certain conditions, redeem the outstanding Series A-1 Preferred Shares in cash at the $1,000 original issue price, subject to adjustment, plus accrued and unpaid dividends. The Company is required to redeem all the outstanding Series A-1 Preferred Shares on August 10, 2024, automatically extended by an additional three (3) month period if the Company has not as of such date closed upon one or more equity financings that, in total, result in gross proceeds to the Company of $10.0 million or greater (which amount has not been achieved as of the date of this report). If the Company raises equity capital, 15% of the net proceeds will be used to redeem the Series A-1 Preferred Shares if requested by the holder.

Warrants

On various dates at the end of December 2023 and through early 2024, we entered a number of separate warrant exchange agreements with various unaffiliated second-party warrant holders with respect to warrants to purchase an aggregate of 1,486,217 shares of our common stock (the “Exchanged Warrants”). Pursuant to these warrant exchange agreements, the Company issued an aggregate of 1,486,217 shares of common stock to those warrant holders in exchange for the surrender and cancellation of the Exchanged Warrants.

In December 2023 and January 2024, holders of an aggregate of 154,563 JTAIW warrants were exercised for an equal number of shares of our common stock, generating net proceeds to us of $1,777,475.

Cash Flows for the six Months Ended June 30, 2024 and 2023

As of June 30, 2024, the Company’s cash and equivalents were approximately $528,000, including approximately $500,000 of restricted cash under its aircraft leasing arrangements described below.

The following table summarizes our cash flows for the six months ended June 30, 2024 and 2023:

Cash Flow from Operating Activities

Net cash used in operating activities for the six months ended June 30, 2024 was approximately $4.7 million compared to approximately $1.9 million for the six months ended June 30, 2023 and was primarily driven by the increase in operating loss discussed above, as well as a $439,000 increase in accounts receivable, a $142,000 reduction in accounts payable, a $680,000 decrease in deferred revenue, partially offset by a $332,000 increase in accrued liabilities.

Cash Flow from Investing Activities

Net cash used in investing activities for the six months ended June 30, 2024 was $13,000 compared to approximately $122,000 for the six months ended June 30, 2023, primarily relating to the Company’s 2023 investment in 380 Software LLC, a 50/50 joint venture subsidiary with Great Western Air LLC dba Cirrus Aviation Services as well as the purchase of the Jet.AI domain name.

Cash Flow from Financing Activities

Net cash provided by financing activities for the six months ended June 30, 2024 was approximately $3.1 million. Cash provided by financing activities was primarily driven by warrant exercises and proceeds from the sale of common stock under the Share Purchase Agreement, sale of preferred stock, partially offset repayments of notes payable.

Aircraft Financing Arrangements

In November 2021 and April 2022, the Company entered into two separate five-year leasing arrangements for the acquisition of two of its HondaJet Elite aircraft. At any time during their term, the Company has the option to purchase either aircraft from the lessor at the aircraft’s fair market value at that time. The leasing arrangements also require the Company to hold a combined liquidity reserve of $500,000 in a separate bank account pledged as security to the lessor, which the Company records as restricted cash on its balance sheet, as well as a maintenance reserve of approximately $690,000 for each leased aircraft, which is held by the lessor in the event the lessor determines that the relevant aircraft is not being maintained in accordance with the lease requirements or to prevent deterioration of the aircraft. Events of default under the leasing arrangements include, among other things, failure to make the monthly payments (with a 10-day cure period), default on other indebtedness, breaches of covenants related to insurance and maintenance requirements, change of control or merger, insolvency and a material adverse change in the Company’s business, operations or financial condition. Please see Note 5 to the Company’s consolidated financial statements for a further description of these leasing arrangements.

In June 2022, the Company received an unsolicited offer for the outright purchase of one of its HondaJet Elite aircraft, which netted the Company approximately $1.2 million of proceeds over the leased cost. After internal financial and legal review, the Company determined that the sale of the aircraft would offer a net benefit to its stakeholders. The Company considered a number of factors in making this decision, including but not limited to: (1) the availability of replacement aircraft, (2) pilot availability, (3) the time to register the aircraft for commercial use, and (4) the risk-adjusted lifetime return on capital associated with operating the aircraft relative to the purchase price offered.

Critical Accounting Estimates

Going Concern and Management Plans

The Company has limited operating history and has incurred losses from operations since its inception. These matters raise concern about the Company’s ability to continue as a going concern.

The Company began ramping up its revenue-generating activities during the second half of the year ended December 31, 2021 and continuing into 2024. During the next twelve months, the Company intends to fund its operations with funds from its operations, and drawdowns under the Share Purchase Agreement, as well as proceeds from other financing arrangements. The Company also has the ability to reduce cash burn to preserve capital. There are no assurances, however, that management will be able to raise capital on terms acceptable to the Company. If the Company is unable to obtain sufficient amounts of additional capital, the Company may be required to reduce the near-term scope of its planned development and operations, which could delay implementation of the Company’s business plan and harm its business, financial condition and operating results. The consolidated balance sheets do not include any adjustments that might result from these uncertainties.

Basis of Presentation for the Business Combination

The Business Combination was accounted for as a reverse recapitalization in accordance with GAAP, whereby Oxbridge is treated as the acquired company and Jet Token is treated as the acquirer (the “Reverse Recapitalization”). Accordingly, for accounting purposes, the Reverse Recapitalization was treated as the equivalent of Jet Token issuing stock for the net assets of Oxbridge, accompanied by a recapitalization. The net assets of Oxbridge were stated at historical cost, with no goodwill or other intangible assets recorded.

Jet Token has been determined to be the accounting acquirer in the Business Combination based on the following predominate factors:

Use of Estimates

The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statement and the reported amounts of expenses during the reporting period. Making estimates requires management to exercise significant judgement. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates.

Material estimates that are particularly susceptible to significant change in the near-term relate to the fair value of options granted. Although considerable variability is likely to be inherent in these estimates, management believes that the amounts provided are reasonable. These estimates are continually reviewed and adjusted if necessary. Such adjustment if reflected in current operations.

Revenue Recognition

In applying the guidance of ASC 606, the Company determines revenue recognition through the following steps:

Revenue is derived from a variety of sources including, but not limited to, (i) fractional/whole aircraft sales, (ii) fractional ownership and jet card programs, (iii) ad hoc charter through the Jet Token App (replaced by CharterGPT) and (iv) aircraft management.

Under the fractional ownership program, a customer purchases an ownership share in a jet which guarantees the customer access to the jet for a preset number of hours per year. The fractional ownership program consists of a down payment, one or more progress payments, a payment on delivery, a monthly management fee and an occupied hourly fee based on usage. Revenues from the sale of fractional or whole interests in an aircraft are recognized at the time title to the aircraft is transferred to the purchasers, which generally occurs upon delivery or ownership transfer.

The jet card program provides the customer with a preset number of hours of guaranteed private jet access over the agreement term (generally a year) without the larger hourly or capital commitment of purchasing an ownership share. The jet card program consists of a fixed hourly rate for flight hours typically paid 100% up front.

Revenue is recognized upon transfer of control of the Company’s promised services, which generally occurs upon the flight hours being used. Any unused hours for the fractional jet and jet card programs are forfeited at the end of the contract term and are thus immediately recognized as revenue at that time.

Deferred revenue is an obligation to transfer services to a customer for which the Company has already received consideration. Upon receipt of a prepayment from a customer for all or a portion of the transaction price, the Company initially recognizes a contract liability. The contract liability is settled, and revenue is recognized when the Company satisfies its performance obligation to the customer at a future date.

The Company also generates revenues from individual ad hoc charter bookings processed through the Company’s booking app, whereby the Company will source, negotiate, and arrange travel on a charter basis for a customer based on pre-selected options and pricing provided by the Company to the customer through the app. In addition, Cirrus markets charter on the Company’s aircraft for the Company’s benefit. Deferred revenue with respect to bookings through the app was $56,000 as of June 30, 2024.

The Company utilizes certificated independent third-party air carriers in the performance of a portion of flights. The Company evaluates whether there is a promise to transfer services to the customer, as the principal, or to arrange for services to be provided by another party, as the agent, using a control model. The nature of the flight services the Company provides to members is similar regardless of which third-party air carrier is involved. The Company directs third-party air carriers to provide an aircraft to a member or customer. Based on evaluation of the control model, it was determined that the Company acts as the principal rather than the agent within all revenue arrangements. Owner charter revenue is recognized for flights where the owner of a managed aircraft sets the price for the trip. The Company records owner charter revenue at the time of flight on a net basis for the margin we receive to operate the aircraft. If the Company has primary responsibility to fulfill the obligation, then the revenue and the associated costs are reported on a gross basis in the consolidated statements of operations.

Flights

Flights and flight-related services, along with the related costs of the flights, are earned and recognized as revenue at the point in time in which the service is provided. For round-trip flights, revenue is recognized upon arrival at the destination for each flight segment.

Fractional and jet card members pay a fixed quoted amount for flights based on a contractual capped hourly rate. Ad hoc charter customers primarily pay a fixed rate for flights. In addition, flight costs are paid by members through the purchase of dollar-denominated prepaid blocks of flight hours (“Prepaid Blocks”), and other incidental costs such as catering and ground transportation are billed monthly as incurred. Prepaid Blocks are deferred and recognized as revenue when the member completes a flight segment.

Aircraft Management

The Company manages aircraft for owners in exchange for a contractual fee. Revenue associated with the management of aircraft also includes the recovery of owner-incurred expenses including maintenance coordination, cabin crew and pilots, as well as recharging of certain incurred aircraft operating costs and expenses such as maintenance, fuel, landing fees, parking and other related operating costs. The Company passes the recovery and recharge costs back to owners at either cost or a predetermined margin.

Aircraft management-related revenue contains two types of performance obligations. One performance obligation is to provide management services over the contract period. Revenue earned from management services is recognized over the contractual term, on a monthly basis. The second performance obligation is the cost to operate and maintain the aircraft, which is recognized as revenue at the point in time such services are completed.

Aircraft Sales

The Company acquires aircraft from vendors and various other second-party sellers in the private aviation industry. The Company’s classifies the purchase as aircraft inventory on the consolidated balance sheets. Aircraft inventory is valued at the lower of cost or net realizable value. Sales are recorded on a gross basis within revenues and cost of revenue in the consolidated statements of operations.

Pass-Through Costs

In applying the guidance of ASC 606, the Company recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the Company expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that the Company determines are within the scope of ASC 606, the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of ASC 606, the Company assesses the goods or services promised within each contract and determines those that are distinct performance obligations. The Company then assesses whether it is acting as an agent or a principal for each identified performance obligation and includes revenue within the transaction price for second-party costs when the Company determines that it is acting as the principal.

Cost of Sales

The cost of sales expenses includes costs incurred in providing air transportation services, such as chartering second-party aircraft, aircraft lease expenses, pilot training and wages, aircraft fuel, aircraft maintenance, and other aircraft operating expenses.

Stock-Based Compensation

The Company accounts for stock awards under ASC 718, Compensation–Stock Compensation. Under ASC 718, stock-based compensation cost is measured at the grant date, based on the estimated fair value of the award, and is recognized as expense over the employee’s requisite vesting period or over the nonemployee’s period of providing goods or services. The fair value of each stock option or warrant award is estimated on the date of grant using the Black-Scholes option valuation model.

Trend Information

The Company’s business and operations are sensitive to general business and economic conditions in the U.S. and worldwide along with local, state, federal and foreign governmental policy decisions. A host of factors beyond Jet.AI’s control could cause fluctuations in these conditions. Adverse conditions may include but are not limited to: changes in the airline industry, fuel and operating costs, changes to corporate governance best practices for executive flying, general demand for private jet travel, regulations on carbon emissions from aviation and market acceptance of the Company’s business model. These adverse conditions could affect the Company’s financial condition and the results of operations.

Fiscal Year Ended December 31, 2023 compared to December 31, 2022

Results of Operations

The following table sets forth our results of operations for the periods indicated:

As discussed more fully below, our results of operations in 2023 and 2022 were impacted significantly by $17.2 million of revenue and $2.1 million of gross profit from fractional sales of all of our then available aircraft in 2022 and the absence of aircraft sales in 2023. Excluding the impact of these fractional sales and despite the increase in our aircraft fleet and charter and jet card/fractional program flight activity, the significant drivers of the decline in gross profit and increase in operating losses resulted from three key factors:

We are cautiously optimistic that CharterGPT and ongoing improvement in its AI-powered features will continue to drive growth in our charter revenues and will drive higher broker productivity going forward. Furthermore, at the end of 2023 and beginning of 2024, we launched DynoFlight and Reroute AI, respectively, as part of the Jet.AI Operator Platform. We believe Reroute AI will generate increased revenue for the Company by driving charter demand for repurposed empty flight legs with little incremental operational costs. We also believe that, once the DynoFlight API has been integrated with FL3XX, a web and app-based aviation management platform, and future customers, it will generate monthly and usage-based revenues with modest operating costs limited to server administration and maintenance of the code base. Furthermore, the Company executed a non-binding letter of intent to acquire five new Challenger 3500 aircraft from Bombardier, consisting of three prospective firm orders and two options. Subject to securing debt financing and the development of a plan with Cirrus for these aircraft, the Company would then pre-sell fractional or whole interests in these aircraft.

Revenues

Revenues for 2023 totaled $12.2 million, a $9.7 million decrease from 2022’s revenues of $21.9 million primarily related to $17.2 million in aircraft sale proceeds in 2022 from the successful fractionalization of the Company’s last HondaJets.

The following table sets forth a breakout of revenue components by subcategory for the year ended December 31, 2023 and 2022.

Software App revenue is the gross amount of charters booked through our app CharterGPT and Cirrus Charter revenue reflects the gross amount of charters on our aircraft booked by Cirrus. Software App revenue was 3.9 million in 2023, compared to 1.0 million in 2022. Cirrus Charter revenue was 3.2 million in 2023, compared to approximately 961,000 in 2022. The increase in Software App and Cirrus Charter revenue reflects primarily a greater number of aircraft operated in 2023 compared to 2022 as well as increased booking through the CharterGPT app. We took delivery of 1 HondaJet in November 2021 and the remaining 2 HondaJets in the third quarter of 2022. We also added a CJ4 aircraft owned by a customer and managed by us to our available fleet of aircraft for charter booking in early 2023.

Under our jet card program we charge an hourly rate for flight time. Under our fractional program we charge a monthly fee and hourly fees based on usage. In both case, prepaid flight hours and usage fees are recognized as revenue as the flight hours are used or forfeited and monthly fees are recognized monthly. Deferred revenue at the end of each period reflects prepaid flight hours for which the related travel had not yet occurred. We also record revenue for additional charges, representing primarily charges for cost reimbursements such as a fuel component adjustment to adjust for changes in fuel prices relative to the jet card and fractional contracts’ base fuel price and reimbursement of federal excise taxes. All of these revenues are reflected as Jet Card and Fractional Program revenues. The increase in revenue from Jet Card and Fractional Programs of approximately $590,000 in 2023 compared to 2022 is due to the increase in the number of the Company’s aircraft and a greater number of Jet Card members.

The following table details the flight hours sold and flown or forfeited, as well as the associated deferred revenues and recognized revenues, respectively, and additional charges for the year ended December 31, 2023 and 2022:

Management and Other Services revenue reflects monthly fees and other expenses from our management of a customer’s CJ4 as well as approximately $220,000 in 2022 from brokerage commissions from an aircraft sale. We began managing the CJ4 in mid-December of 2022.

Cost of revenues

Our cost of revenue is generally comprised of payments to Cirrus for the maintenance and management of our fleet of aircraft, including the CJ4, commissions to Cirrus for their arranging for charters on our aircraft, aircraft lease expense, federal excise tax relating to jet card and third-party charters, and payments to third-party aircraft operators for their aircraft chartered through our App, as well as the cost of our subcharters for covering jet card flights when our aircraft were unavailable. The management of our aircraft by Cirrus covers all our aircraft regardless of whether the aircraft are used for program flight hours or charter flights and includes expenses such as fuel, pilot wages and training costs, aircraft insurance, maintenance and other flight operational expenses.

As a result of primarily of our increased fleet, the increase in jet card hours flown and additional costs resulting from pilot turn over discussed above, as well as the startup costs relating to the introduction of the CJ4 to our fleet, costs related to the operation of our aircraft and payments to Cirrus for their management increased $3.4 million from $2.0 million in 2022 to $5.4 million in 2023 and aircraft lease payments increased $337,000 from $855,000 in 2022 to $1.2 million in 2023. The Company also incurred third-party charter costs of approximately $5.4 million in 2023, a $4.0 million increase over 2022 reflecting primarily lack of availability of our aircraft due to pilot turnover and increased training time, combined with increased charter activity. Merchant fees and federal excise tax relating to charter flights of $304,000 in 2023 were a $48,000 increase over in 2022.

In total, it cost $12.4 million to operate our aircraft in 2023, compared to $4.4 million to operate fewer aircraft on average in 2022. We also incurred $15.2 million in 2022 cost of revenue directly associated with our fractional and whole aircrafts sales.

Gross (loss) profit

As a result of the foregoing, the Company had a gross loss of approximately $179,000 for 2023, compared to a gross profit of approximately $2.1 million for 2022. The 2022 results were positively affected by the fractionalization of the Company’s HondaJets. Excluding the profit from these fractionalizations, gross profit for 2022 would have been approximately $216,000, with the decline primarily due to increased pilot wages and training, offset by increased flight activity.

Total Operating Expenses

In 2023, the Company’s operating expenses increased by approximately $2.4 million over the prior year due to an approximate $2.5 million increase in general and administrative expenses. Excluding non-cash stock-based compensation of $6.6 million and $6.5 million in 2023 and 2022, respectively, general and administrative expenses rose by approximately $2.2 million, primarily due to an increase in professional service expenses of $1.4 million in large part due to the expenses of our Business Combination. In addition our insurance expenses increased $58,000 over the 2022 amount of $31,000 due to the significantly higher premiums for D&O insurance as a public company.

The Company’s sales and marketing expenses increased by about $147,000 to approximately $574,000 in 2023 from approximately $427,000 in 2022, due to slightly increased marketing spend to promote the Company and its programs.

Research and development expenses increased by approximately $24,000 in 2023 over 2022 due to the development and continuing refinement of CharterGPT and our Jet.AI Operator Platform of software products.

Operating Loss

As a result of all of the above, in 2023 the Company recognized an operating loss of approximately $12.5 million, which was an increase in loss of approximately $4.8 million over 2022. $2.1 million of this decrease is directly attributable to gross profit from fractionalization of our HondaJets in 2022 that did not recur in 2023. The remainder of the decrease, excluding non-cash compensation expenses, resulted from increased pilot wages and costs, increased subcharters, increased professional services expense from the Business Combination and higher D&O insurance costs.

Other Expense (Income)

During 2023, the Company recognized approximately $104,000 in other expense due primarily due to interest expense 2023 related to the Company’s Bridge Agreement as defined and discussed below.

Net Loss to Common Stockholders

After deducting cumulative preferred stock dividends of approximately $47,000 in 2023, which have been accruing since the August 2023 issuance date of the Series A Preferred Shares and Series A-1 Preferred Shares, net loss to common stockholders increased by $4.9 million.

Liquidity and Capital Resources

Overview

As of December 31, 2023, the Company’s cash and equivalents were approximately $2.1 million, including approximately $500,000 of restricted cash under its aircraft leasing arrangements described below. As of December 31, 2023, current liabilities exceeded current assets by $3.8 million, of which $1.8 million in liabilities represents deferred revenue that would be recorded as revenue once the flight hours are flown or forfeited.

Subsequent to December 31, 2023 and through March 31, 2024, the Company raised (1) approximately $1,110,000 in funds from the issuance of 1,500,000 shares of Common Stock under the Share Purchase Agreement discussed below, (2) approximately $742,000 from Jet.AI Warrant exercises and (3) approximately $1.5 million in gross proceeds from the Selling Stockholder Transaction discussed below. Collectively, these actions resulted in our receiving an additional $3,352,000 of cash subsequent to December 31, 2023. In addition, in March 2024, the Company fully repaid approximately $683,000 of amounts due under the Bridge Agreement described below.

The Company also incurred negative cash flows from operating activities and significant losses from operations in the past as reflected in its accumulated deficit of $39.4 million as of December 31, 2023. While we expect to drive revenue and operating profit growth from aircraft acquisitions, higher average hourly pricing of jet cards, increased charter activity through CharterGPT and Reroute AI and SaaS revenues from DynoFlight, we expect to continue to incur operating losses to a greater or lesser extent for at least the next 12 months, depending on the timing and success of these initiatives. To bridge the gap, we intend to rely on funds available from share issuances under the Share Purchase Agreement and amounts received upon an exercise of the Warrant, if any, to meet our funding obligations. Additional funding under the Share Purchase Agreement may be limited contractually and the Warrant may not be exercised by the holder. Furthermore, issuances of additional shares of Common Stock under the Share Purchase Agreement or upon conversion of the Series B Preferred Stock outstanding and underlying the Warrant may negatively impact the Company’s stock price and ability to raise additional funds. We will likely require additional capital resources to grow our business. In the absence of external financing the Company is prepared to cut its cash utilization by ceasing marketing and customer acquisition, suspending software development, streamlining operations, and servicing only existing customers. Such a reduction would allow the Company to continue to operate for a year or more by management’s estimate. During that time the Company would plan to arrange new financing and to then resume expansion.

Selling Stockholder Transaction

General

On March 28, 2024, Company entered into the Securities Purchase Agreement and certain other transaction documents described below with the Selling Stockholder in connection with a private placement transaction which closed on March 29, 2024 (the “Closing Date”), which we collectively refer to as the “Selling Stockholder Transaction”.

Pursuant to the Securities Purchase Agreement, the Company agreed to issue to the Selling Stockholder (a) 150 shares of Series B Preferred Stock, which are convertible into shares of Common Stock, (b) the Warrant to purchase up to 1,500 shares of Series B Preferred Stock at an exercise price of $10,000 per share, and (c) 250,000 shares of Common Stock.

The Company received gross proceeds of approximately $1.5 million, not including customary placement fees and reimbursement of certain amounts payable to Maxim as placement agent and other expenses payable by the Company in connection with the Selling Stockholder Transaction. This amount excludes the proceeds, if any, from the exercise of the Warrant. The Company expects to use a portion of the net proceeds received upon execution of the Securities Purchase Agreement to partially redeem its Series A Preferred Shares and, potentially, its Series A-1 Preferred Shares. The Company intends to use the remainder of the net proceeds for working capital, capital expenditures, product development, and other general corporate purposes. The Company has not allocated specific amounts of net proceeds for any of these purposes.

Series B Preferred Stock

On March 28, 2024, we filed a Certificate of Designations of the Series B Convertible Preferred Stock with the Secretary of State of the State of Delaware, which provides for the issuance of up to 5,000 shares of the Company’s Series B Preferred Stock. The Series B Preferred Stock ranks pari passu with the Series A Preferred Shares and Series A-1 Preferred Shares and senior to all other capital stock of the Company.

Each share of Series B Preferred Stock converts into a number of shares of our Common Stock, subject to certain limitations, including a beneficial ownership limitation of 4.99% (calculated in accordance with the rules promulgated under Section 13(d) of the Securities Exchange Act), which can be adjusted to a beneficial ownership limitation of 9.99% upon 61 days prior written notice by the Selling Stockholder. From time to time the Selling Stockholder may convert Series B Preferred Stock into Common Stock which it may liquidate and thereafter receive additional shares of Common Stock pursuant to subsequent conversions of its Series B Preferred Stock. Although the beneficial ownership limitation imposes a legally binding limitation on the Selling Stockholder’s beneficial ownership at any point in time, it does not prohibit the Selling Stockholder from, over time, receiving shares of Common Stock upon separate conversions of its shares of Series B Preferred Stock that, in the aggregate and over a period of time, exceed the beneficial ownership limitation.

Subject to the limitations set forth in the preceding paragraph and provided there is an effective registration statement covering the Selling Stockholder’s resale of Common Stock underlying the Series B Preferred Stock, shares of Series B Preferred Stock will automatically convert into shares of Common Stock on or prior to the tenth trading day after the issuance date of such shares of Series B Preferred Stock. The number of shares of Common Stock issuable upon conversion of a share of Series B Preferred Stock is calculated by dividing the conversion amount per share of Series B Preferred Stock by the then conversion price. The conversion amount is equal to the stated value of the shares of Series B Preferred Stock, which is $10,000, plus any additional amounts and late charges calculated in accordance with the Certificate of Designations. The conversion price is equal to 90% (or, in the case of a delisting, 80%) of the lowest daily volume weighted average price (“VWAP”) of our Common Stock over a period beginning on the trading day after we deliver shares of Common Stock upon such conversion to the Selling Stockholder and ending on the trading day on which the aggregate dollar trading volume of our Common Stock exceeds seven times the applicable conversion amount, subject to a five trading day minimum period for such calculation, and subject to certain adjustments.

If certain defined “triggering events” defined in the Certificate of Designations occur, such as a breach of the Registration Rights Agreement, suspension of trading, or our failure to convert the Series B Preferred Stock into Common Stock when a conversion right is exercised, then we may be required to redeem the Series B Preferred Stock for cash at 110% of the stated value.

The foregoing description of the Series B Preferred Stock does not purport to be complete and is qualified in its entirety by reference to the Certificate of Designations, a copy of which is filed as Exhibit 3.5 to the registration statement of which this prospectus forms a part and is incorporated herein by reference.

Other Transaction Documents

The Warrant exercise price is initially set at $10,000 per share of Series B Preferred Stock of, subject to adjustment for certain events, such as stock split, issuance of additional shares as a dividend or otherwise. If all of the Warrant was exercised for cash, the Company would receive additional gross proceeds of approximately $15.0 million. The Company cannot predict when or if the Warrant will be exercised. It is possible that the Warrant may never be exercised. At any time when the Warrant is exercisable for less than 1,000 shares of Series B Preferred Stock, the Company has the right to redeem all or a portion of the Warrant by paying to the Selling Stockholder in cash $100 per share of Series B Preferred Stock that would otherwise be issuable pursuant to the Warrant.

The Securities Purchase Agreement contains customary representations and warranties of the Company, on the one hand, and the Selling Stockholder, on the other hand, and customary conditions to closing. Pursuant to the Securities Purchase Agreement, the Company agreed to submit to its stockholders a proposal to approve the issuance of shares of Common Stock issuable upon exercise of the shares of Series B Preferred Stock in accordance with Nasdaq Stock Market Rules at a special meeting of stockholders at the earliest practicable date after the date of the Securities Purchase Agreement, but in no event later than ninety (90) days after the Closing Date. The Company entered into a voting agreement (the “Voting Agreement”) with Michael Winston, the Company’s Interim Chief Executive Officer, and the Sponsor, who together held approximately 43.6% of the voting power of the Company as of the record date for the Company’s annual meeting of stockholders, agreeing to vote in favor of the proposal. At its annual meeting of stockholders, which took place on September 24, 2024, the Company sought stockholder approval for the potential issuance of shares of common stock pursuant to the Selling Stockholder Transaction in an amount that, upon issuance, could result in the issuance of shares of common stock in an amount in excess of 20% of the Company’s outstanding shares of common stock at a price less than the “minimum price” as defined by and in accordance with Nasdaq Listing Rule 5635(d). The Company’s stockholders approved such potential issuance at the annual meeting. The Securities Purchase Agreement obligates the Company to reserve no less than 200% of the maximum number of shares of Common Stock issuable upon conversion of the Series B Preferred Stock outstanding, using an alternate conversion method (the “Required Reserve Amount”). The Company and the Selling Stockholder have agreed that the Required Reserve Amount is 45,000,000 shares of Common Stock. In order to meet that obligation, the Company sought stockholder approval to amend its certificate of incorporation to increase the number of authorized shares of Common Stock to 200,000,000 at its annual meeting of stockholders. The Company received such approval on September 24, 2024.

Additionally, on March 29, 2024, the Company entered into the Registration Rights Agreement the Selling Stockholder, which, among other things, provides that the Company will register the resale of the 250,000 shares of Common Stock and the shares of Common Stock issuable upon conversion of the Series B Preferred Stock, including the Series B Preferred Stock issuable upon exercise of the Warrant. The Company is required to prepare and file a registration statement with the SEC no later than 30 days following the filing of the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 (the “Form 10-K”), but in no event later than May 15, 2024 (the “Filing Failure”, and such deadline, the “Filing Deadline”), and to use its commercially reasonable efforts to have the registration statement and any amendment declared effective no later than the earlier of the (a) 60th calendar day following the filing of the Form 10-K (or, if such registration statement is subject to a full review by the SEC, the 100th calendar day after such filing) and (b) 2nd business day after the date the Company is notified (orally or in writing, whichever is earlier) by the SEC that such registration statement will not be reviewed or will not be subject to further review (the “Effectiveness Deadline”). The Company filed a registration statement on Form S-1 pursuant to the foregoing obligation by the Filing Deadline, and does not owe the Selling Stockholder a fee of $100,000. Because this registration statement was not declared effective by the SEC by the Effectiveness Deadline, the Company was obligated pay to the Selling Stockholder a $100,000 Effectiveness Fee. On September 3, 2024 the Company issued to the Selling Stockholder 100,000 Effectiveness Shares in lieu of paying the Effectiveness Fee in cash.

The Company has also agreed to, among other things, indemnify the Selling Stockholder, its members, managers, directors, officers, partners, employees, agents, representatives and persons who control the Selling Stockholder under the registration statement from certain liabilities and pay all fees and expenses (excluding any underwriting discounts and selling commissions) incident to the Company’s obligations under the Registration Rights Agreement.

The securities issued pursuant to the Securities Purchase Agreement were not registered under the Securities Act and were offered pursuant to an exemption from the registration requirements of the Securities Act pursuant to Section 4(a)(2) of the Securities Act and/or Rule 506(b) of Regulation D promulgated under the Securities Act. The securities may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.

Copies of the Securities Purchase Agreement, the Voting Agreement, the Warrant, the Registration Rights Agreement, and the Letter Agreement are filed as Exhibits 10.30, 10.31, 4.5, 10.32, and 10.39, respectively, to the registration statement of which this prospectus forms a part. The above summary of such agreements and documents does not purport to be complete and is qualified in its entirety by reference such agreements and is incorporated herein by reference herein.

Share Purchase Agreement

The Company has access to an aggregate of $40 million from the Share Purchase Agreement with GEM less drawdowns of $1,110,000 to date. In consideration for GEM’s services under the Share Purchase Agreement, the Company has agreed to pay GEM a commitment fee equal to $800,000 payable in cash or freely tradable shares of Common Stock, at the option of the Company. Upon the Company’s issuance of shares in connection with any drawdown purchase made by GEM, the Company is required to pay GEM a portion of such commitment fee in an amount equal to 2% of the amount purchased in such drawdown; provided that the full $800,000 commitment fee shall be paid on or before the first anniversary of the closing of the Business Combination. The Company is obligated to pay the commitment fee regardless of the amount of funds it draws down under the Share Purchase Agreement.

GEM is not obligated to purchase shares under the Share Purchase Agreement if any purchase of shares would result in GEM and its affiliates beneficially owning, directly or indirectly, at the time of the proposed issuance, more than 9.99% of the number of issued and outstanding shares of Common Stock as of the date of such proposed issuance. GEM may waive the restriction under the Share Purchase Agreement by providing the Company with sixty-one (61) days’ notice that the Purchaser would like to waive the restriction with regard to any or all shares issuable pursuant to the Share Purchase Agreement.

On August 10, 2023, the Company issued the GEM Warrant, pursuant to an exemption from registration under Section 4(a)(2) of the Securities Act, granting it the right to purchase up to 6% of the outstanding Common Stock of the Company on a fully diluted basis as of the date of listing. The GEM Warrant has a term of three years. The exercise price of the GEM Warrant, as of December 31, 2024, was $8.40 per share; provided, that, if the average closing price of Jet.AI’s Common Stock for the 10 trading days following the first anniversary of the date of listing is less than 90% of the then current exercise price of the GEM Warrant, then the exercise price of the GEM Warrant will be adjusted to 110% of our then current trading price. The warrant may be exercised by payment of the per share amount in cash or through a cashless exercise.

The GEM Warrant provides that GEM can elect to limit the exercisability of the GEM Warrant such that it is not exercisable to the extent that, after giving effect to the exercise, GEM and its affiliates, to the Company’s actual knowledge, would beneficially own in excess of 4.99% of Jet.AI’s Common Stock outstanding immediately after giving effect to such exercise. GEM has made this election, which makes funds available under the Share Purchase Agreement in excess of this 4.99% ownership limit up to the 9.99% ownership restriction in the Share Purchase Agreement. GEM may revoke this election by providing written notice, which revocation will not be effective until the sixty-first (61st) day thereafter.

Meteora Transactions

On August 6, 2023, we entered into a Forward Purchase Agreement with Meteora for OTC Equity Prepaid Forward Transactions. The purpose of our entering into this agreement and these transactions was to provide a mechanism whereby Meteora would purchase, and waive their redemption rights with respect to, a sufficient number of Oxbridge Class A ordinary shares to enable Oxbridge to have at least $5,000,000 of net tangible assets, a non-waivable condition to the Closing of the Business Combination and to provide the Company with cash to meet a portion of the transaction costs associated with the Business Combination.

Pursuant to the terms of the Forward Purchase Agreement, Meteora intended, but was not obligated to, purchase up to 1,186,952 (the “Purchased Amount”) of Oxbridge’s Class A ordinary shares concurrently with the Closing. The shares initially purchased by Meteora consisted of 663,556 Recycled Shares it purchased from third parties through a broker in open market transactions and 247,000 Additional Shares it purchased directly from us in a private placement, pursuant to an exemption from registration under Section 4(a)(2) of the Securities Act, for a per share price of $10.00 pursuant to an FPA Funding Amount PIPE Subscription Agreement. Of these Recycled Shares, 50,000 Recycled Shares represented Share Consideration to Meteora under the Forward Purchase Agreement and are not subject to the terms of the Forward Purchase Agreement, meaning that Meteora is free to sell such shares and retain all proceeds therefrom. Netting out the Share Consideration, the total “Number of Shares” initially subject to the terms of the Forward Purchase Agreement was 861,312. Following the Closing of the Business Combination, we paid to Meteora $6,805,651 representing amounts payable by us to Meteora under the Forward Purchase Agreement, net of the aggregate purchase price of the total number of Additional Shares issued to Meteora under the FPA Funding Amount PIPE Subscription Agreement; and Meteora paid us ½ of the Prepayment Shortfall, or $625,000.

Pursuant to the terms of the Forward Purchase Agreement, in December 2023, Meteora sent OET Notices to the Company informing the Company that it had elected to terminate the transaction with respect to all outstanding shares and paid the Company an aggregate $921,945. As a result of the foregoing transactions, the net proceeds received by the Company from the issuance of additional Common Stock pursuant to the Forward Purchase Agreement and the FPA Funding Amount PIPE Subscription Agreement are $1,221,945 and the facility was terminated.

Bridge Agreement

On September 11, 2023, the Company entered into a binding term sheet (“Bridge Agreement”) with eight investors to provide the Company $500,000 of short-term bridge financing pending its receipt of funds from its other existing financing arrangements.

The Bridge Agreement was entered into with, and funding was provided by, Michael Winston, the Executive Chairman of the Board and Interim Chief Executive Officer, Wrendon Timothy, a member of the Board and all three Committees of the Board, William Yankus, a member of the Board and two of its Committees, and Oxbridge RE Holdings Limited, a significant stockholder of the Company for which Mr. Timothy serves as a director and officer, as well as the four other investors named in the Bridge Agreement.

Given Mr. Winston’s dual role as a participant in the negotiations with third parties and his participation in the bridge financing itself, for avoidance of doubt, he waived any right to receive accrued interest on the principal amount of his Note, as well as any redemption premium or any increase in the principal amount of his Note in connection with an event of default (the “Waiver”). The Company’s Audit Committee pursuant to its charter, and the full Board, including a majority of disinterested directors, unanimously approved the Bridge Agreement, in each case finding that the Bridge Agreement was in the best interests of the Company and its stockholders.

As of December 31, 2023, the Bridge Agreement provided for the issuance of Notes, in an aggregate principal amount of $625,000, reflecting a 20% original issue discount. The Notes bore interest at 5% per annum and matured on March 11, 2024. The Company was required to redeem the Notes with 100% of the proceeds of any equity or debt financing at a redemption premium of 110% of the principal amount of the Notes. In March 2024, the Company fully repaid the Bridge Agreement in the amount of approximately $683,000, representing principal, redemption premium and interest.

Other Equity Issuances and Settlement Arrangements

Maxim Payment and Settlement Agreement

On August 10, 2023, the Company entered into a settlement agreement (“Maxim Settlement Agreement”) with Maxim, the underwriter for the Company’s initial public offering. Pursuant to the Maxim Settlement Agreement, the Company issued to Maxim Partners in a private placement pursuant to an exemption from registration under Section 4(a)(2) of the Securities Act, (a) 270,000 shares of Common Stock to Maxim Partners to settle the payment obligations of the Company under the underwriting agreement dated on or about August 11, 2021, by and between the Company and Maxim and (b) 1,127 Series A Preferred Shares to Maxim Partners in an amount equal in value to $1,127,000 (the “Series A Preferred Shares”). The Series A Preferred Shares accrue interest at the rate of 8% per annum (which increases to 18% if the Company fails to meet certain obligations under the terms thereof), payable quarterly and, at the Company’s option, in shares of Common Stock. The Series A Preferred Shares are convertible into 112,700 shares of Common Stock. The Company also issued 115,000 shares of Common Stock to Maxim Partners on August 16, 2021, in a private placement exempt from registration under Section 4(a)(2) of the Securities Act, to meet a payment obligation under the underwriting agreement in connection with Oxbridge’s IPO, representing a value of $9.00 per share reflecting an allocation of the $10.00 per Unit IPO price.

The Company may, subject to certain conditions, redeem the outstanding Series A Preferred Shares in cash at the $1,000 original issue price, subject to adjustment, plus accrued and unpaid dividends. The Company was required to redeem all the outstanding Series A Preferred Shares on August 10, 2024, which was automatically extended by an additional three (3) month period because the Company has not closed upon one or more equity financings that, in total, result in gross proceeds to the Company of $10.0 million or greater. If the Company raises equity capital, 15% of the net proceeds will be used to redeem the Series A Preferred Shares if requested by the holder.

In July 2024 the Company and Maxim entered into an amendment to the Maxim Settlement Agreement and agreed to, among other things, amend the definition of the “Series A Conversion Price” for the Series A Preferred Shares and certain restrictions with respect to shares of Company common stock Maxim may acquire upon the conversion of its Series A Preferred Shares.

Sponsor Settlement Agreement

On August 10, 2023, the Company entered into settlement agreement (“Sponsor Settlement Agreement”) with OAC Sponsor Ltd., a Cayman Islands exempted company (the “Sponsor”), the sponsor of Oxbridge. Pursuant to the Sponsor Settlement Agreement, the Company issued, in a private placement exempt from registration under Section 4(a)(2) of the Securities Act, 575 Series A-1 Preferred Shares to settle the payment obligations of the Company under a promissory note in the principal amount of $575,000 dated November 14, 2022 in favor of Sponsor. The Series A-1 Preferred Shares accrue interest at the rate of 5% per annum (which increases to 18% if the Company fails to meet certain obligations under the terms thereof), payable quarterly in cash. The Series A-1 Preferred Shares are convertible into 57,500 shares of Common Stock. The shares of Common Stock issuable upon conversion of the Series A-1 Preferred Shares are subject to a registration rights agreement between the Company and Sponsor.

The Company may, subject to certain conditions, redeem the outstanding Series A-1 Preferred Shares in cash at the $1,000 original issue price, subject to adjustment, plus accrued and unpaid dividends. The Company was required to redeem all the outstanding Series A-1 Preferred Shares on August 10, 2024, which was automatically extended by an additional three (3) month period because the Company has not closed upon one or more equity financings that, in total, result in gross proceeds to the Company of $10.0 million or greater. If the Company raises equity capital, 15% of the net proceeds will be used to redeem the Series A-1 Preferred Shares if requested by the holder.

Warrants

On various dates at the end of December 2023 and through early 2024, we entered a number of separate warrant exchange agreements with various unaffiliated third-party warrant holders with respect to warrants to purchase an aggregate of 1,486,217 shares of our Common Stock (the “Exchanged Warrants”). Pursuant to these warrant exchange agreements, the Company issued an aggregate of 1,486,217 shares of Common Stock to those warrant holders in exchange for the surrender and cancellation of the Exchanged Warrants, in reliance upon the exemption from the registration requirements under Section 3(a)(9) under the Securities Act of 1933, as amended.

A copy of the form of warrant exchange agreement is filed as Exhibit 10.28 to the registration statement of which this prospectus forms a part.

In December 2023 and January 2024, holders of an aggregate of 154,563 JTAIW warrants were exercised for an equal number of shares of our Common Stock, generating net proceeds to us of $1,777,475.

Cash Flows

As of December 31, 2023, the Company’s cash and equivalents were approximately $2.1 million, including approximately $500,000 of restricted cash under its aircraft leasing arrangements described below.

The following table summarizes our cash flows for year ended December 31, 2023 and 2022:

Cash Flow from Operating Activities

The increase in net cash used in operating activities for 2023 was primarily driven by increase in operating loss discussed above.

Cash Flow from Investing Activities

Net cash used in investing activities for the year ended December 31, 2023 was $190,998, primarily relating to the Company’s investment in 380 Software LLC, a 50/50 joint venture subsidiary with Great Western Air LLC dba Cirrus Aviation Services as well as the purchase of the Jet.AI domain name. This is compared to net cash provided by investing activities in 2022 of $290,488 driven by an increase in aircraft deposit rebates.

Cash Flow from Financing Activities

Net cash provided by financing activities of $4.5 million for the year ended December 31, 2023, was primarily driven by net offering proceeds (net of offering costs from the Company’s Regulation A offering) of $2.4 million. These net offering proceeds reflect (1) approximately $1.2 million in proceeds from the Forward Purchase Agreement and (2) approximately $1.2 million of net proceeds from the latter part of the Company’s Regulation A offering of non-voting Common Stock which terminated in January 2023. From June 2021 to January 2023, the Company conducted an offering under Regulation A and issued 8,767,126 shares, or approximately 271,000 shares of Common Stock and 432,000 Merger Consideration Warrants following the Business Combination, and representing approximately $6.6 million in gross proceeds. In addition, in 2023 the Company raised $500,000 under its Bridge Agreement, approximately $1.0 million from the exercise of warrants and approximately $621,000 of proceeds from the Business Combination.

Aircraft Financing Arrangements

In November 2021 and April 2022, the Company entered into two separate five-year leasing arrangements for the acquisition of two of its HondaJet Elite aircraft. At any time during their term, the Company has the option to purchase either aircraft from the lessor at the aircraft’s fair market value at that time. The leasing arrangements also require the Company to hold a combined liquidity reserve of $500,000 in a separate bank account pledged as security to the lessor, which the Company records as restricted cash on its balance sheet, as well as a maintenance reserve of approximately $690,000 for each leased aircraft, which is held by the lessor in the event the lessor determines that the relevant aircraft is not being maintained in accordance with the lease requirements or to prevent deterioration of the aircraft. Events of default under the leasing arrangements include, among other things, failure to make the monthly payments (with a 10-day cure period), default on other indebtedness, breaches of covenants related to insurance and maintenance requirements, change of control or merger, insolvency and a material adverse change in the Company’s business, operations or financial condition. Please see Note 5 to the Company’s financial statements for the year ended December 31, 2023 for a further description of these leasing arrangements.

In June 2022, the Company received an unsolicited offer for the outright purchase of one of its HondaJet Elite aircraft, which netted the Company approximately $1.2 million of proceeds over the leased cost. After internal financial and legal review, the Company determined that the sale of the aircraft would offer a net benefit to its stakeholders. The Company considered a number of factors in making this decision, including but not limited to: (1) the availability of replacement aircraft, (2) pilot availability, (3) the time to register the aircraft for commercial use, and (4) the risk-adjusted lifetime return on capital associated with operating the aircraft relative to the purchase price offered.

Plan of Operation

Aviation

The Company contemplates acquiring addition aircraft to grow its business and it currently anticipates financing the acquisition of such aircraft through the sale of fractional and whole interests, debt/lease financing and advanced sales of flight time.

In the fourth quarter of 2022, we launched the Onboard Program to allow aircraft owners to contribute their aircraft to the Company’s charter and jet card inventory. The Onboard Program requires one month FAA conformity of aircraft onto the Cirrus Aviation Part 135 certificate, a one week pilot recertification course for charter operation and execution of a limited management agreement.

Software

CharterGPT powered by Jet.AI: We plan to build a natural language interface charter app to replace the existing B2C app found in the iOS/Android stores, respectively. We retained two individuals who act as external contractors, who collaborate with our CTO. We own, without restriction, all rights to all intellectual property generated for the CharterGPT project by these external contractors. The nature of the work performed by the external contractors relates to the design and implementation of the App’s front-end and back end, respectively. The front-end contractor envisions and renders a visually appealing and intuitive workflow for the App compatible with the input requirements of the back end. The App workflow includes but is not limited to registration, charter jet search, booking, and payment. The back-end developer writes original computer code and integrates certain open-source software. For more information on the proposed features and benefits see the section of this prospectus entitled “Business — Strategy – Artificial Intelligence.”

Jet.AI Operator Platform: Jet.AI plans to reorganize and to recharacterize its B2B software development efforts under the banner of a new suite of SaaS products termed “Jet.AI Operator Platform” as follows:

Critical Accounting Estimates

Going Concern and Management Plans

The Company has limited operating history and has incurred losses from operations since its inception. These matters raise concern about the Company’s ability to continue as a going concern.

The Company began ramping up its revenue-generating activities during the second half of the year ended December 31, 2021 and continuing into 2022 and 2023. During the next twelve months, the Company intends to fund its operations with funds from its operations, and drawdowns under the Share Purchase Agreement, as well as proceeds from other financing arrangements. The Company also has the ability to reduce cash burn to preserve capital. There are no assurances, however, that management will be able to raise capital on terms acceptable to the Company. If the Company is unable to obtain sufficient amounts of additional capital, the Company may be required to reduce the near-term scope of its planned development and operations, which could delay implementation of the Company’s business plan and harm its business, financial condition and operating results. The consolidated balance sheets do not include any adjustments that might result from these uncertainties.

Basis of Presentation for the Business Combination

The Business Combination was accounted for as a reverse recapitalization in accordance with GAAP, whereby Oxbridge is treated as the acquired company and Jet Token is treated as the acquirer (the “Reverse Recapitalization”). Accordingly, for accounting purposes, the Reverse Recapitalization was treated as the equivalent of Jet Token issuing stock for the net assets of Oxbridge, accompanied by a recapitalization. The net assets of Oxbridge were stated at historical cost, with no goodwill or other intangible assets recorded.

Jet Token has been determined to be the accounting acquirer in the Business Combination based on the following predominate factors:

Use of Estimates

The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statement and the reported amounts of expenses during the reporting period. Making estimates requires management to exercise significant judgement. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates.

Material estimates that are particularly susceptible to significant change in the near-term relate to the fair value of options granted. Although considerable variability is likely to be inherent in these estimates, management believes that the amounts provided are reasonable. These estimates are continually reviewed and adjusted if necessary. Such adjustment is reflected in current operations.

Revenue Recognition

In applying the guidance of ASC 606, the Company determines revenue recognition through the following steps:

Revenue is derived from a variety of sources including, but not limited to, (i) fractional/whole aircraft sales, (ii) fractional ownership and jet card programs, (iii) ad hoc charter through the Jet Token App (replaced by CharterGPT) and (iv) aircraft management.

Under the fractional ownership program, a customer purchases an ownership share in a jet which guarantees the customer access to the jet for a preset number of hours per year. The fractional ownership program consists of a down payment, one or more progress payments, a payment on delivery, a monthly management fee and an occupied hourly fee based on usage. Revenues from the sale of fractional or whole interests in an aircraft are recognized at the time title to the aircraft is transferred to the purchasers, which generally occurs upon delivery or ownership transfer.

The jet card program provides the customer with a preset number of hours of guaranteed private jet access over the agreement term (generally a year) without the larger hourly or capital commitment of purchasing an ownership share. The jet card program consists of a fixed hourly rate for flight hours typically paid 100% up front.

Revenue is recognized upon transfer of control of the Company’s promised services, which generally occurs upon the flight hours being used. Any unused hours for the fractional jet and jet card programs are forfeited at the end of the contract term and are thus immediately recognized as revenue at that time.

Deferred revenue is an obligation to transfer services to a customer for which the Company has already received consideration. Upon receipt of a prepayment from a customer for all or a portion of the transaction price, the Company initially recognizes a contract liability. The contract liability is settled, and revenue is recognized when the Company satisfies its performance obligation to the customer at a future date.

The Company also generates revenues from individual ad hoc charter bookings processed through the Company’s booking app, whereby the Company will source, negotiate, and arrange travel on a charter basis for a customer based on pre-selected options and pricing provided by the Company to the customer through the app. In addition, Cirrus markets charter on the Company’s aircraft for the Company’s benefit. Deferred revenue with respect to bookings through the app was $268,818 as of December 31, 2023.

The Company utilizes certificated independent third-party air carriers in the performance of a portion of flights. The Company evaluates whether there is a promise to transfer services to the customer, as the principal, or to arrange for services to be provided by another party, as the agent, using a control model. The nature of the flight services the Company provides to members is similar regardless of which third-party air carrier is involved. The Company directs third-party air carriers to provide an aircraft to a member or customer. Based on evaluation of the control model, it was determined that the Company acts as the principal rather than the agent within all revenue arrangements. Owner charter revenue is recognized for flights where the owner of a managed aircraft sets the price for the trip. The Company records owner charter revenue at the time of flight on a net basis for the margin we receive to operate the aircraft. If the Company has primary responsibility to fulfill the obligation, then the revenue and the associated costs are reported on a gross basis in the consolidated statements of operations.

Flights

Flights and flight-related services, along with the related costs of the flights, are earned and recognized as revenue at the point in time in which the service is provided. For round-trip flights, revenue is recognized upon arrival at the destination for each flight segment.

Fractional and jet card members pay a fixed quoted amount for flights based on a contractual capped hourly rate. Ad hoc charter customers primarily pay a fixed rate for flights. In addition, flight costs are paid by members through the purchase of dollar-denominated prepaid blocks of flight hours (“Prepaid Blocks”), and other incidental costs such as catering and ground transportation are billed monthly as incurred. Prepaid Blocks are deferred and recognized as revenue when the member completes a flight segment.

Aircraft Management

The Company manages aircraft for owners in exchange for a contractual fee. Revenue associated with the management of aircraft also includes the recovery of owner-incurred expenses including maintenance coordination, cabin crew and pilots, as well as recharging of certain incurred aircraft operating costs and expenses such as maintenance, fuel, landing fees, parking and other related operating costs. The Company passes the recovery and recharge costs back to owners at either cost or a predetermined margin.

Aircraft management-related revenue contains two types of performance obligations. One performance obligation is to provide management services over the contract period. Revenue earned from management services is recognized over the contractual term, on a monthly basis. The second performance obligation is the cost to operate and maintain the aircraft, which is recognized as revenue at the point in time such services are completed.

Aircraft Sales

The Company acquires aircraft from vendors and various other third-party sellers in the private aviation industry. The Company’s classifies the purchase as aircraft inventory on the consolidated balance sheets. Aircraft inventory is valued at the lower of cost or net realizable value. Sales are recorded on a gross basis within revenues and cost of revenue in the consolidated statements of operations.

Pass-Through Costs

In applying the guidance of ASC 606, the Company recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the Company expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that the Company determines are within the scope of ASC 606, the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of ASC 606, the Company assesses the goods or services promised within each contract and determines those that are distinct performance obligations. The Company then assesses whether it is acting as an agent or a principal for each identified performance obligation and includes revenue within the transaction price for third-party costs when the Company determines that it is acting as the principal.

Cost of Sales

The cost of sales expenses includes costs incurred in providing air transportation services, such as chartering third-party aircraft, aircraft lease expenses, pilot training and wages, aircraft fuel, aircraft maintenance, and other aircraft operating expenses.

Stock-Based Compensation

The Company accounts for stock awards under ASC 718, Compensation – Stock Compensation. Under ASC 718, stock-based compensation cost is measured at the grant date, based on the estimated fair value of the award, and is recognized as expense over the employee’s requisite vesting period or over the nonemployee’s period of providing goods or services. The fair value of each stock option or warrant award is estimated on the date of grant using the Black-Scholes option valuation model.

Trend Information

The Company’s business and operations are sensitive to general business and economic conditions in the U.S. and worldwide along with local, state, federal and foreign governmental policy decisions. A host of factors beyond Jet.AI’s control could cause fluctuations in these conditions. Adverse conditions may include but are not limited to: changes in the airline industry, fuel and operating costs, changes to corporate governance best practices for executive flying, general demand for private jet travel, regulations on carbon emissions from aviation and market acceptance of the Company’s business model. These adverse conditions could affect the Company’s financial condition and the results of operations.

BUSINESS

Overview

Our business strategy combines concepts from fractional jet and charter jet programs with innovations in artificial intelligence, also referred to herein is “AI.” Our purposeful enhancement of price discovery has the potential to produce fairer and more inclusive results for aircraft owners and travelers alike.

We formed the Company on June 4, 2018. We developed and, in September 2019, launched our booking platform represented by our iOS app JetToken (the “App”), which originally functioned as a prospecting and quoting platform to arrange private jet travel with third party carriers. Following our acquisition of HondaJets, we began selling jet cards and fractional ownership interests in our aircraft. In 2023, we launched an AI-enhanced booking app called CharterGPT, as more fully discussed under “ – Our Software Platforms – Our Booking Platform and CharterGPT” and “Strategy - Artificial Intelligence” below.

Beginning in 2023, we launched our Jet.AI Operator Platform to provide a B2B software platform for SaaS products. Currently we offer the following SaaS software to aircraft owners and operators generally:

We have also established a specific version of a private jet by the seat booking tool called for the Las Vegas Golden Knights and Cirrus Aviation via 380 Software LLC. 380 Software LLC is a by-the-seat charter joint venture between us and Cirrus Aviation.

Our strategy involves expanding our fleet of aircraft with larger aircraft capable of traveling longer distances, developing a national jet card program based on third party aircraft, further enhancing the AI functionality of Charter GPT, and expanding upon our B2B software offerings. Our strategy involves expanding our fleet of aircraft with larger aircraft capable of traveling longer distances, further enhancing the AI functionality of Charter GPT, expanding upon Reroute AI and DynoFlight.

The Business Combination

General

On August 10, 2023, Jet.AI Inc., a Delaware corporation (f/k/a Oxbridge Acquisition Corp.), consummated a “Business Combination” pursuant to the Business Combination Agreement and Plan of Reorganization, dated February 24, 2023, as amended by Amendment No. 1 to the Business Combination Agreement, dated as of May 11, 2023, by and among Oxbridge Acquisition Corp. (“Oxbridge”), the Merger Subs and Jet Token. Pursuant to the Business Combination Agreement, Oxbridge redomiciled as a Delaware corporation and was immediately renamed Jet.AI, Inc., and promptly thereafter, (a) First Merger Sub merged with and into Jet Token with Jet Token surviving the merger as a wholly owned subsidiary of Jet.AI Inc., and (b) Jet Token merged with and into Second Merger Sub (each merger and all other transactions contemplated by the Business Combination Agreement, the “Business Combination”).

As a result of the Business Combination:

As a result of the Business Combination, Jet.AI Inc. has one class of Common Stock, listed on Nasdaq under the ticker symbol “JTAI”, and had two classes of warrants the Jet.AI Warrants and the Merger Consideration Warrants, listed on Nasdaq under the ticker symbols “JTAIW” and “JTAIZ” respectively.

Certain Financing Arrangements

Prior to and in connection with the Business Combination, we entered into financing arrangements intended to provide us with equity-based financing.

In August 2022, Jet Token entered into a Share Purchase Agreement, dated as of August 4, 2022 (the “Share Purchase Agreement”), with GEM Yield LLC SCS and GEM Yield Bahamas Limited (together with GEM Yield LLC SCS, “GEM”), which was automatically assigned to the Company upon the Closing of the Business Combination. Under the Share Purchase Agreement, the Company has the right to periodically issue and sell to GEM, and GEM has agreed to purchase, up to $40,000,000 aggregate value of shares of the Company’s Common Stock (the “Aggregate Limit”) during the 36-month period following the date of the Closing of the Business Combination. GEM is not obligated to purchase shares under the Share Purchase Agreement if any purchase of shares would result in GEM and its affiliates beneficially owning, directly or indirectly, at the time of the proposed issuance, more than 9.99% of the number of issued and outstanding shares of Common Stock as of the date of such proposed issuance. In consideration for these services, the Company has agreed to pay GEM a commitment fee equal to $800,000 payable in cash or freely tradable shares of Common Stock at the “Daily Closing Price” of the Common Stock, at the option of the Company. Pursuant to the Share Purchase Agreement, on August 10, 2023, the Company issued GEM a warrant (as subsequently amended, the “GEM Warrant”) granting it the right to purchase up to 6% of the outstanding Common Stock of the Company on a fully diluted basis as of the date of listing, with exercisability currently limited to 4.99% of the Company’s Common Stock outstanding immediately after giving effect to such exercise. The GEM Warrant has a term of three years from the date of issuance and, as of December 31, 2024, had an exercise price of $8.40 per share (subject to potential reduction in August 2024).

On August 6, 2023, we entered into an agreement with (i) Meteora Capital Partners, LP (“MCP”), (ii) Meteora Select Trading Opportunities Master, LP (“MSTO”), and (iii) Meteora Strategic Capital, LLC (“MSC” and, collectively with MCP and MSTO, “Meteora”) (as amended on August 31, 2023 and October 2, 2023, the “Forward Purchase Agreement”) for OTC Equity Prepaid Forward Transactions. The primary purpose of our entering into the Forward Purchase Agreement and these transactions was to provide a mechanism whereby Meteora would purchase, and waive their redemption rights with respect to, a sufficient number of Oxbridge Class A ordinary shares to enable Oxbridge to have at least $5,000,000 of net tangible assets, a non-waivable condition to the Closing of the Business Combination and to provide the Company with cash to meet a portion of the transaction costs associated with the Business Combination. Following the Closing of the Business Combination, we paid to Meteora $6,805,651, representing amounts payable by us to Meteora under the Forward Purchase Agreement, net of the aggregate purchase price of the total number of Additional Shares (as defined and discussed below) issued to Meteora under the FPA Funding Amount PIPE Subscription Agreement; and Meteora paid us ½ of the Prepayment Shortfall (as defined below), or $625,000. The Forward Purchase Agreement was amended to provide payment to the Company of an additional $550,000, reflecting payment in full of the amended Prepayment Shortfall of $1,175,000. The Company also received approximately $1.2 million from the issuance of Common Stock under the Forward Purchase Agreement, including due to early termination of the facility.

In connection with the Business Combination, we also entered into settlement agreements with Maxim, the underwriter for the Company’s initial public offering, and with OAC Sponsor Ltd., a Cayman Islands exempted company (the “Sponsor”), the sponsor of Oxbridge, each providing for the issuance of equity in satisfaction of Oxbridge payment obligations.

Please see “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources – Overview” for a further discussion of the terms of these financing arrangements and other recent financing transactions.

Recent Events

Nasdaq Compliance

Our Common Stock is currently listed on Nasdaq under the symbol “JTAI”. On December 1, 2023, the Company received a notification letter (the “Initial Notice Letter”) from the Nasdaq Listing Qualifications Staff of Nasdaq notifying the Company that its amount of stockholders’ equity has fallen below the $10 million required minimum for continued listing on The Nasdaq Global Market set forth in Nasdaq Listing Rule 5450(b)(1)(A) (the “Minimum Stockholders’ Equity Requirement”). The Company’s stockholders’ deficit as of December 31, 2023 was $(3,963,039). The Initial Notice Letter also noted that as of September 30, 2023, the Company did not meet The Nasdaq Global Market alternative listing criteria for the “Market Value” standard or the “Total Assets / Total Revenues” standard. The Initial Notice Letter further noted that the Company may consider applying to transfer the Company’s securities to The Nasdaq Capital Market, which would require the Company to, among other things, meet The Nasdaq Capital Market’s continued listing requirements. On August 14, 2024, the Nasdaq Hearings Panel granted the Company’s request to transfer the Company’s securities from The Nasdaq Global Market to The Nasdaq Capital Market to be effective as of the opening of trading on August 16, 2024.

On April 14, 2024, the Company received an additional notification letter from Nasdaq (the “Second Notice Letter”) stating that the Company is not in compliance with Nasdaq Listing Rule 5450(a)(1), as the minimum bid price of the Company’s Common Stock has been below $1.00 per share for 30 consecutive business days (the “Minimum Bid Price Requirement”). The notification of noncompliance has no immediate effect on the listing or trading of the Company’s Common Stock on Nasdaq. The Company has 180 calendar days, or until October 14, 2024, to regain compliance with the Minimum Bid Price Requirement. To regain compliance, the minimum bid price of the Company’s Common Stock must meet or exceed $1.00 per share for a minimum of ten consecutive business days during this 180-calendar day grace period. In the event the Company does not regain compliance with the Minimum Bid Price Requirement by October 14, 2024, the Company may be eligible for an additional 180-calendar day compliance period because it elected to transfer to The Nasdaq Capital Market. To qualify, the Company would be required to meet the continued listing requirements for market value of publicly held shares and all other initial listing standards for The Nasdaq Capital Market, with the exception of the bid price requirement, and would need to provide written notice of its intention to cure the bid price deficiency during the second compliance period. The Company’s failure to regain compliance during this period could result in delisting. The Company intends to actively monitor the bid price of its Common Stock and may, if appropriate, consider implementing available options to regain compliance with the Minimum Bid Price Requirement.

On May 30, 2024, the Company received an additional notification letter from Nasdaq (the “Third Notice Letter”) stating that the Company has not regained compliance with the Minimum Stockholders’ Equity Requirement for continued listing discussed in the Initial Notice Letter, which it was required to meet by May 29, 2024 pursuant to its compliance plan. The Third Notice Letter notified the Company that, unless the Company requested an appeal hearing before the Nasdaq Hearings Panel (the “Panel”) by June 6, 2024, trading of the Company’s Common Stock would be suspended at the opening of business on June 10, 2024, and a Form 25-NSE would be filed with the SEC, which would remove the Company’s securities from listing and registration on Nasdaq (such notification, the “Delisting Notice”).

As directed in the Third Notice Letter, the Company timely requested a hearing before the Panel and paid the applicable fee to appeal the Delisting Notice. The Delisting Notice has no immediate effect on the listing or trading of the Company’s Common Stock. The Company’s hearing request stayed the suspension of trading on the Company’s securities, and the Company’s securities continue to trade on Nasdaq. On August 14, 2024, in connection the implementation of the Company’s compliance plan, the Nasdaq Hearings Panel granted the Company’s request to transfer the Company’s securities from The Nasdaq Global Market to The Nasdaq Capital Market to be effective as of the opening of trading on August 16, 2024. Further the Nasdaq Hearings Panel granted the Company’s request to have until November 26, 2024 to demonstrate compliance with its previously submitted plan, a deadline that the Company believes to be attainable. The Company is working diligently to cure the deficiencies set forth in the Delisting Notice and plans to regain compliance with the continued listing requirements as soon as practicable.

Although the Company believes it will be able to achieve compliance with Nasdaq’s continued listing requirements, there can be no assurance that the Company will be able to regain compliance with such requirements, or maintain compliance with any other listing requirements within the time frame required by Nasdaq or at all, particularly if the Company’s stock price trades below $1.00 for a sustained period. Nasdaq’s determination that we fail to meet the continued listing standards of Nasdaq may result in our securities being delisted from Nasdaq as set forth in the Delisting Notice.

Letter Agreements

On September 24, 2024, the Company and the Selling Stockholder entered into the Letter Agreement that set forth certain understandings and agreements among the Company and the Selling Stockholder. Pursuant to the Letter Agreement, the Selling Stockholder agreed to refrain from taking action to protect its legal rights under the transaction documents, related to certain actions and transactions identified in the Letter Agreement that the Company has undertaken or effected prior to the date of the Letter Agreement. As consideration for the waiver, the Company agreed to a release of the Selling Stockholder and its affiliates and issued an additional 50 shares of Series B Preferred Stock to the Selling Stockholder.

On October 10, 2024, the Company and the Selling Stockholder entered into the Second Letter Agreement that set forth certain understandings and agreements among the Company and the Selling Stockholder. Pursuant to the Second Letter Agreement, the Selling Stockholder agreed to refrain from taking action to protect its legal rights under the transaction documents, related to certain actions and transactions identified in the Second Letter Agreement. Such actions include the Company’s filing of an amendment to the registration statement on Form S-1 (File No. 333-281911) with the SEC and a registered direct offering. As consideration for the waiver, the Company agreed to change the Conversion Measurement Period (as defined in the Certificate of Designations) for the previously issued 200 shares of Series B Preferred Stock to begin on March 28, 2024 and to end in accordance with the Certificate of Designations.

Registered Direct Offering

On October 10, 2024, the Company entered into Securities Purchase Agreements (the “RDO Purchase Agreements”) with institutional investors for the sale by the Company of 26,666,666 shares (the “RDO Shares”) of the Company’s Common Stock at a per share price of $0.09. The closing of the offering occurred on October 11, 2024. The gross proceeds to the Company from the offering was approximately $2.4 million, before deducting the placement agent’s fees and other estimated offering expenses payable by the Company. The offering of the RDO Shares was made pursuant to a shelf registration statement on Form S-3 (File No. 333-281578), which was originally filed by the Company with the SEC on August 15, 2024, and declared effective on September 9, 2024. The Company filed a prospectus supplement dated October 11, 2024 with the SEC in connection with the offer and sale of the RDO Shares on October 11, 2024.

Also on October 10, 2024, the Company entered into a placement agency agreement with Maxim (the “RDO Placement Agency Agreement”), pursuant to which the Company agreed to pay the Maxim an aggregate fee equal to 7.0% of the aggregate gross proceeds received by the Company from the sale of the RDO Shares in the offering. The Company also agreed to reimburse Maxim for certain expenses in an amount up to $100,000.

In connection with the offer and sale of the RDO Shares, the Company’s directors and executive officers entered into lock-up agreements, pursuant to which they agreed, for a period of 90 days after the closing and subject to certain exceptions, not to directly or indirectly offer, sell, or otherwise transfer or dispose of, directly or indirectly, any common stock of the Company or any securities convertible into or exercisable or exchangeable for common stock of the Company.

Our Aircraft Operations

In July 2021, we leased a HondaJet aircraft under a short-term lease arrangement, which terminated in February 2022, to accelerate our aircraft operations and sales of jet card memberships. We have acquired four HondaJet Elite aircraft under our 2020 Purchase Agreement with Honda Aircraft Company, discussed under “– Our Aircraft” below, all four of which have been sold, but three of which remain part of our fleet, as discussed below, with three of the four aircraft having been delivered in 2022. Great Western Air, LLC (DBA Cirrus Aviation Services, LLC) (“Cirrus”) is managing, operating, and maintaining our aircraft and has a growing team of pilots that have been specially trained on the HondaJet at the Flight Safety facility on the Honda Aircraft Company campus in Greensboro, NC. Cirrus has additionally developed a safety co-pilot training program in coordination with the FAA and a local flight training academy for licensed pilots already skilled with the Garmin 1000 avionics suite.

We offer the following programs for our HondaJet Elite aircraft:

In addition to servicing members, fractional owners and third-party charter clients, our HondaJets are available to address unexpected cancellations or delays on brokered charters. Unlike most of our brokerage competitors, as well as many business jet management companies which require owner approval before their aircraft can be used for third party charter, we believe maintaining a fleet of readily available aircraft to back fill third party charter services provides more reliability and is an attractive selling point for potential clients.

In 2022, we entered into agreements with Cirrus under which we will sell jet cards for Cirrus’s aircraft, for a commission for sales and client management services, and we make Cirrus’s aircraft available to our customers for charter bookings at preferred rates and with certain service guarantees. As a result, our jet card members and charter customers have access to twenty of Cirrus’s aircraft in the light, mid, super-mid, heavy, and ultra-long-range categories, comprising the following aircraft: CJ3+, CJ4, Lear 45XR, Citation XLS+, Lear 60, Hawker 900XP, Challenger 300, Challenger 604, Falcon 900EX, Challenger 850, Gulfstream V and Gulfstream G550.

In the fourth quarter of 2022, we launched the Onboard Program to allow aircraft owners to contribute their aircraft to the Company’s charter and jet card inventory. The Onboard Program requires one month FAA conformity of aircraft onto the Cirrus Aviation Part 135 certificate, a one-week pilot recertification course for charter operation and execution of a limited management agreement. To date we have a CJ4 customer aircraft managed pursuant to our OnBoard Program.

Our Software Platforms

Our Booking Platform CharterGPT

Our booking platform displays a variety of options across private aircraft types in addition to the pricing of our own aircraft, with a range of prices drawn from a list of thousands of aircraft for hire. We offer users the ability to request a jet and to simultaneously task us with seeking a lower-cost otherwise superior alternative. Our App (or CharterGPT) is directly connected via our application programming interface (API) to Avinode, the major centralized database in private aviation. Through Avinode we can electronically and automatically correspond with operators of private jets who have posted their aircraft for hire. We envision a time when CharterGPT draws upon resources other than Avinode for private aircraft inventory, in particular we contemplate a connection between the inventory found in Reroute AI and CharterGPT.

The CharterGPT app, which we released in the iOS and Android stores in 2023 to replace the charter booking function of our Jet Token App, automates certain of these manual steps involved in charter bookings, and we believe this automation will enable us to scale charter activity with fewer persons than would be normally required. In particular, CharterGPT is designed to do the following: (1) intake travel requirements in natural language and then interact with customers to provide substantive replies and actionable suggestions with quality indistinguishable from an experienced charter professional; (2) power the content behind outbound calls to smaller charter operators to confirm electronic indications of interest communicated via the Avinode centralized booking database of private aircraft; (3) reconcile the natural language terms in a third party jet operator contract with the terms and conditions in the contract the customer signs with us (4) verify that payment for the charter has cleared.

Jet.AI Operator Platform

Jet.AI provides and continues to develop a B2B software platform for a suite of SaaS products termed “Jet.AI Operator Platform” which currently consists of:

Reroute AI

In 2024 we launched Reroute AI. Reroute AI software is web based and enables FAA Part 135 operators to earn revenue on otherwise empty flight legs. When prompted with basic travel itinerary information such as city pair and date of travel, Reroute AI searches its database of empty flight legs and proposes novel combinations of those legs that meet these constraints it has been given. Its database of empty flight legs comes from API integrations with certain other databases and a ChatGPT enhanced scrape of publicly available empty leg lists published by Part 135 operators. An operator may upload its own aircraft tail numbers and empty leg list if for any reason one or both have not already been uploaded into the system. Jet.AI generates revenue from Reroute AI when an operator wishes to book an itinerary proposed by the software that involves the use of aircraft outside that operator’s fleet. In that instance, Jet.AI acts as broker to the operator using Reroute AI’s proposed itinerary and a human in the loop to negotiate the new pricing and new routing of the third party operator’s aircraft.

DynoFlight

DynoFlight is a software API that we launched at the end of 2023. It enables aircraft operators to track and estimate emissions and then purchase carbon offset credits. DynoFlight offers small to medium sized operators a way to begin tracking and offsetting their carbon credits with advances estimation techniques, compliant practices, and quality credits at prices usually only accessible to operators working at a much larger scale that are buying in bulk. In February, 2024, the Company announced a collaboration with FL3XX, a web and app-based aviation management platform, to introduce the DynoFlight carbon offset platform to FL3XX customers. We believe the DynoFlight API may offer an advantage even to large organizations that wish to manage working capital more efficiently (i.e. pay as they fly instead of buying in bulk). We are currently in the process of integrating the DynoFlight API with the FL3XX systems. We believe that, once the DynoFlight API has been integrated with FL3XX and future customers, it will generate monthly and usage-based revenues with modest operating costs limited to server administration and maintenance of the code base.

FlightClub – Cirrus Specific

The Flight Club API is designed to enable FAA Part 135 operators to function simultaneously under FAA Part 380 which permits sale of private jet service by the seat instead of by whole aircraft. The Flight Club software integrates front end ticketing and payment collection with the flight management systems of an FAA Part 135 operator. It automates the process of filing forms for each flight with DOT and conforms with DOT escrow requirements around ticketing and movement of customer funds. Our initial use case of the Flight Club is through 380 Software LLC, a 50% owned subsidiary founded in co-operation with our operating partner and 50% owner of 380 Software LLC, Cirrus Aviation. The Company retains all rights to the technology powering 380 Software LLC and has granted 380 Software LLC a perpetual non-transferrable license. This initial implementation of the Flight Club permits the owners of Cirrus Aviation-managed aircraft to fly on one another’s planes at a significantly reduced cost when those planes are otherwise flying empty. The operating costs of these flights are typically borne by the previous charter customer who is typically obliged to pay not only the cost of an outbound leg but also the cost of the return leg. The charter customer is typically obliged to pay the cost of the return because the sale of the empty return is an inherently low probability event based on historical industry experience.

We are currently focused on our partnership with the Las Vegas Golden Knights and on integrating with their systems to generate seat sales. Once we learn more from the Cirrus and Las Vegas Golden Knight partnerships we will decide whether to expand the availability of Flight Club.

Strategy

Aircraft Operations

Having successfully executed the HondaJet four aircraft fleet deal and further having sold through all four aircraft, three of which remain part of our fleet, as discussed below, we plan to gradually expand our fleet with super-mid-size aircraft and the help of our operating partner, Cirrus. Cirrus manages a fleet of 30 jets in Las Vegas, where we are headquartered. We have executed a non-binding letter of intent to acquire five new Challenger 3500 aircraft from Bombardier, consisting of three prospective firm orders and two options. Subject to (1) our securing of debt financing to fund the initial fleet purchase down payment and (2) the development of a management, interchange and support plan with our partner Cirrus, we would then plan to execute a formal fleet purchase agreement, and anticipate being able to secure the first Challenger 3500 delivery in the second quarter of 2026. Once a fleet purchase agreement is in force, we would then look to pre-sell fraction interests in these aircraft with a bias toward larger fractions. Upon delivery, the jets would in turn be managed by Cirrus and listed on their Part 135 certificate. Customers would be expected to make a down payment and progress payments, consistent with fractional industry norms.

Given the two-year timeframe prior to delivery, the Company may consider independent development of Part 135 operations, subject to management’s internal return on capital targets and, depending on the level of scale, the prospective benefits of enhanced operational control on customer service.

Because all major manufacturers of super-mid or large cabin aircraft such as Gulfstream, Falcon, Bombardier, Embraer, and Textron each have one to three year waiting lists for super-mid-size jets, many of our fractional competitors can only pre-sell, and remain otherwise unable to offer the related service. Our strategy is to allow customers, in advance of delivery, to fly on Cirrus’s managed Challenger 300/350, 604/605 and 850 model Bombardier aircraft. In return the customer would pay a monthly management fee (MMF) and an occupied hourly fee (OHF) at rates substantially similar to those for their Challenger 3500. We believe this “buy and fly” approach may resonate with market participants who may appreciate the convenience of a fractional program without the extraordinarily long wait.

Conventional wisdom in private aviation has been that a light jet FAA Part 135 operation presents financial challenges because the lower hourly rate of a light jet leaves little margin to pay a second pilot and remain profitable. Thanks to our partnership with Cirrus, we have addressed this concern by having a typed pilot in command with at least 1,500 hours in jets, 1,000 of which must have been in the HondaJet specifically, fly alongside a co-pilot who has been through an FAA approved ground school developed by Cirrus and Chennault Flying Service. This “safety co-pilot” is permitted to operate the aircraft in the unlikely event the pilot in command is incapacitated or otherwise unable to act. The HondaJet, which has been designated by the FAA for single pilot operation, integrates the Garmin 3000 flight system and by law does not require a second pilot to fly. This safety co-pilot program brings trained pilots who are already schooled in either the Garmin 1000 or Garmin 3000 flight system, gives them additional training on the HondaJet and Garmin 300 system, and then allows them to develop their skills alongside a mentor. Importantly, the presence of this safety co-pilot is regarded by our insurer as sufficient to maintain our present level of premium. The safety pilot does not require a full wage because of their status as a trainee and the professional value they gain from accruing jet flight hours. This lower cost of labor helps the Company overcome the traditional costs of paying a second pilot and helps bring a stream of prospective pilot in command candidates. Some safety pilots are newer to aviation while others have had many years of flight training and thousands of hours of flight time on civilian (or military) jet or turboprop aircraft. We believe that the comparatively low cost of entry of the HondaJet and the proven capabilities of the Challenger 3500 are attractive to new and seasoned traveler alike, particularly given our ability to offer interchange between the two aircraft and onto any one of twenty of the thirty aircraft managed by Cirrus. In addition, while some customers have shorter mission profiles and lower passenger loads better suited to the HondaJet others have longer mission profiles with higher passenger loads – and so the HondaJet and the Challenger 3500 (plus Cirrus’s fleet) again make an excellent combination in our view. We have taken a gradual approach to fleet expansion given the capital-intensive nature of aviation and our view that customers should bear the risk (and related tax reward) of owning and maintaining airplanes.

Jet.AI Operator Platform

Jet.AI provides and continues to develop a B2B software platform for a suite of SaaS products termed “Jet.AI Operator Platform.” In addition to continuing to develop and enhance Reroute AI and DynoFlight, we may further develop our Flight Club API described above to make it available to Part 135 operators more broadly. We also plan to further enhance our internally developed membership portal.

Artificial Intelligence

We operate an app in the iOS and Android stores. The app functions as a prospecting and quoting tool for those interested in chartering a private jet. In 2023, we released an enhanced booking app called CharterGPT to automate much of the manual labor in charter bookings for all of the steps between a customer’s firm indication of interest and their arrival at ultimate destination. We believe this automation will enable us to scale charter activity with fewer persons than would be normally required. In particular, CharterGPT is designed to do the following: (1) intake travel requirements in natural language and then interact with customers to provide substantive replies and actionable suggestions with quality indistinguishable from an experienced charter professional; (2) power the content behind outbound calls to smaller charter operators to confirm electronic indications of interest communicated via the Avinode centralized booking database of private aircraft; (3) reconcile the natural language terms in a third party jet operator contract with the terms and conditions in the contract the customer signs with us (4) verify that payment for the charter has cleared.

In addition, in 2024, we incorporated the following AI-powered features to offer a continually improving unique and personalized experience to customers:

Aircraft Recommendation Engine: Our This feature provides customers greater transparency and understanding of the characteristics of charter relevant to their trips, making it easier for them to make an informed decision. The recommendation engine analyzes a list of available jets based on the travelers request, and considers factors such as budget, preferred aircraft size, age of aircraft, distance of the trip compared with non-stop/range capability, number of passengers, ages and weights of passengers and their respective bags compared with cargo capacity, basic take-off weight limitations, operator safety audit (Argus/Wyvern), cabin amenities such as a fully enclosed lavatory, WiFi availability and years since last interior refurbishment.

Customer service: This feature provides intelligent customer service by using natural language processing and machine learning algorithms to understand and respond to initial booking requests. Untrained call center staff and brittle chat bots characterize much of the customer facing experience today in the US. With the advent of AI, we believe that even for high ticket items, consumers will come to expect a natural language interface trained on terabytes of data that relate specifically to their respective purchases.

Charter brokerage is labor intensive, and most customers are highly price sensitive. We believe these two factors explain why no charter broker has acquired more than 3-5% of the one million brokered flights that land each year in North America. The back end of the App is expected to provide three features that may address the labor intensity (and hence scalability) of our charter brokerage business. First, each charter operator has its own form of legal contract for carriage and that contract must be reconciled with the terms found in the charter brokers’ agreement with the passenger. Our AI is expected to perform this reconciliation automatically, improving the speed to close with the client and reducing labor costs. Second, many charter operators do not initially respond to electronic requests delivered through the Avinode charter database that powers our app. Our generative chat AI is expected to perform outbound voice calls to prompt aircraft operators to respond to quotes we have requested via the web interface to their Avinode account. Third, we expect to develop our AI to integrate with Schedero (an Avinode based scheduling application) to generate a trip sheet for a given charter and then to further integrate with Stripe to invoice and confirm payment via credit card, wire, or ACH.

In addition, we are developing the following AI-powered features to incorporate into the AI functionality of CharterGPT:

Predictive Destination Optimization: CharterGPT is expected to initially make use of information such as airport closures, fuel prices, historical traffic patterns, landing fees, and traveler preferences to then recommend which private airport to select when a traveler’s destination address is serviced by multiple airstrips. For example, Los Angeles is serviced by Los Angeles International Airport (LAX), Van Nuys Airport (KVNY), Burbank Bob Hope Airport (KBUR), John Wayne Airport (KSNA). Landing at an airport farther from one’s ultimate destination may save time if doing so enables faster ground transportation.

Predictive Departure Date: CharterGPT is expected to analyze historical pricing data and forward-looking event data related to a given itinerary to predict the best date to book a flight to obtain the lowest price for their desired charter itinerary. Although approximately thirty-five blackout days a year are widely understood to absorb most domestic private aviation capacity, a variety of lesser appreciated grey-out days centered around key sporting events or entirely new happenings can affect both regional and national pricing.

Predictive Departure Time: CharterGPT is expected to use machine learning algorithms to recommend the optimal departure time based on both historical and live weather conditions, air traffic, and other factors, to help customers more reliably arrive at their destination on time.

Predictive Ground Transportation: CharterGPT is expected to recommend ground transportation. For example, some airports run out of rental cars at certain times each year because of an annual conference or other recurring special event. Some of our competitors have taken steps to remedy the shortage at some airports by positioning in their own vehicles for customer use.

Sales and Marketing

Our marketing and advertising efforts are focused on high-net-worth individuals. We have observed that many first-time private flyers came to market beginning in 2020 in an effort to avoid commercial travel and thereby curtail their prospective exposure to COVID-19. We intend to continue to expand our marketing and advertising through the following channels: online marketing, television advertising and event marketing. Paid social media and search engine advertising drive our online marketing. In the past we have launched 15 and 30 second advertising spots that are targeted at high-net-worth individuals and corporate executives through several channels, including CNBC, Fox Business, and The Golf Channel, as well as online through Facebook and Linked-In. We intend to expand social media and event marketing in particular, provided those meet our internal return targets. With respect to event marketing we intend to have a presence at sporting events, business jet industry gatherings and Company hosted aircraft static displays.

Market Opportunity

Over the past 30 years, the market for private jet travel has transformed significantly. First the model of full aircraft ownership transformed into fractional ownership with companies such as NetJets and FlexJet. This was followed by operators offering jet cards and on-demand service through their fleet of aircraft. The latest iteration of private jet travel provides even more flexibility by providing an on-demand service to travelers while leveraging the flight availability of one or more third party carriers. The result of this transformation is a highly segmented industry with numerous market participants offering varying levels of ownership.

We believe that by combining the private jet on-demand model with commercial airline flight availability and prospectively the underutilized flight hours of private jet operators, our Company will be positioned to provide optimum flexibility and cost efficiency for our clients.

Our Aircraft

The Company’s aircraft fleet consists of five aircraft – three HondaJet HA-420 aircraft (the “HondaJet Elites”), one Citation CJ4 Gen 2 aircraft, and one King Air 350i. The Company acquired the three HondaJet Elites pursuant to a Purchase Agreement with Honda Aircraft Company for a multi-aircraft deal for four HondaJet Elites. One of the HondaJet Elites in our current fleet was sold and is now leased by the Company from Western Finance Company. The other two HondaJet Elites in our current fleet were purchased and subsequently financed through the sale of all fractional interests in each of these aircraft. We also acquired a fourth HondaJet Elite pursuant to the Purchase Agreement with Honda Aircraft Company, but we sold this aircraft in June 2022, after we determined, based on our internal financial and legal review, that the sale of the aircraft would offer a net benefit to our stakeholders. The Citation CJ4 Gen 2 and King Air 350i in our fleet are owned by customers and managed through our OnBoard Program, which allows aircraft owners to contribute their aircraft to our charter and jet-card inventory after they have completed certain FAA certifications and requirements.

Under the terms of our management agreement, which has a term of one year that automatically renews unless otherwise terminated by either party upon 30 days prior notice, the customer pays us a monthly management fee for services, including aircraft management services, flight crew services, such as pilot hiring, flight operations services, aircraft maintenance management and other administrative services.

HondaJet Elite aircraft are ideally suited for trips under 3 hours carrying 2-4 passengers plus two pilots. We believe the HondaJet Elite aircraft is one of the most spacious and cost-efficient light jets on the market with ample baggage and interior room (including an enclosed lavatory). The wing mounted engines allow for a tranquil, spacious interior. Engines on the wings mean less weight on the tail and more room in the cabin.

As discussed above in “Business – Strategy – Aircraft Operations” above we have executed a non-binding letter of intent to acquire five new Challenger 3500 aircraft from Bombardier, consisting of three prospective firm orders and two options. Subject to (1) our securing of debt financing to fund the initial fleet purchase down payment and (2) the development of a management, interchange and support plan with our partner Cirrus, we would then plan to execute a formal fleet purchase agreement, and anticipate being able to secure the first Challenger 3500 delivery in the second quarter of 2026. once a fleet purchase agreement is in force, we would then look to pre-sell one quarter, one half or full interest in these aircraft. Upon delivery, the jets would in turn be managed by Cirrus and listed on their Part 135 certificate. Customers would be expected to make a down payment and progress payments, consistent with fractional industry norms.

If we include its predecessors the Challenger 300 and Challenger 350, Bombardier has sold over 1,000 serial numbers in the Challenger 3500 line, which in our view remains one of the most popular and reliable super-mid-size jets in the world. The aircraft requires no major scheduled maintenance overhaul in its first two years of service, a testament to the depth of historical experience the manufacturer has developed with this model of aircraft since the Challenger 300 was introduced in 1999. The spacious 8-9 seat stand-up cabin, 43,000 foot flight ceiling and Mach 0.83 capability, make it a leading choice for travelers. After twenty-four years in service the Challenger 300/350/3500 airframe has attracted a sizable community of typed pilots and Bombardier has constructed 41 worldwide service centers (11 in the US) to support utilization.

We currently base our fleet at Harry Reid International airport in Las Vegas, NV, a top ten private jet destination and may relocate the fleet based on seasonal travel patterns and the travel patterns of our membership.

Based on our experience, and in light of many of our competitors restricting charters on certain “blackout dates,” we estimate that thirty calendar days per year (due to holidays, major sporting events, etc.) it is extremely difficult to fly private without the guaranteed access provided by a jet membership program such as ours. The ability to safely offer guaranteed capacity, on demand, is one of the most important features one can deliver in private aviation. Also, our aircraft give us the ability to attract online visitors with dynamically priced offers.

We have entered into an Executive Aircraft Management and Charter Services Agreement with Cirrus. Under this agreement, Cirrus provides management services to us with respect to the marketing, operation, maintenance and administration of our aircraft. Specifically, following the initial set-up services, Cirrus provides Flight Crew Services, including selection, training, employment and management of the pilots necessary for operating the Company’s Aircraft; Flight Operation Services, including flight scheduling, following and support services; Aircraft Maintenance Services, including maintenance of the Aircraft and/or management of maintenance of the Aircraft performed by third parties, related maintenance support functions and the administration of the Aircraft’s log books, manuals, data, records, reports and subscriptions; Administrative Services, including budgeting, accounting and reporting services; Facility Services, including providing and/or arranging for aircraft hangar and support facilities at the Aircraft’s Operating Base and other locations at which the Aircraft may be situated from time to time; and Insurance Services, including providing insurance policies for the Aircraft.

Cirrus is the largest private jet charter company based in Las Vegas. The Cirrus team has been managing and operating aircraft – commercially and privately – for more than 40 years. In addition, Cirrus is:

Cirrus maintains, services and operates our aircraft on our behalf and in compliance with all applicable FAA regulations and certification requirements. Cirrus has the capability to provide substitute aircraft at competitive rates in periods of excess demand for our aircraft.

Competition

The private air travel industry is extraordinarily competitive. We will compete against private jet charter and fractional jet companies. Established private jet brokerage and fractional companies include but are not limited to, NetJets, FlexJet, VistaGlobal (including JetSmarter powered by XO), SentientJet, WheelsUp, JetSuite, Flight Options, Nicholas Air, Jet Alliance, Executive Air Share, Plane Sense, One Sky Jets, StarJets, Jet Aviation, Volato and Luxury Aircraft Solutions. All compete for passengers with a variety of pricing plans, aircraft types, blackout periods, booking terms, flyer programs and other products and services, including seating, food, entertainment and other on-board amenities.

Both the private jet charter companies and the legacy airlines and low-cost carriers have numerous competitive advantages that enable them to attract both business and leisure travelers. Our competitors may have corporate travel contracts that direct large numbers of employees to fly with a preferred carrier. The enormous route networks operated by our competitors, combined with their marketing and partnership relationships with regional airlines and international alliance partner carriers, allow them to generate increased passenger traffic from domestic and international cities. Our access to smaller aircraft fleet networks and lack of connecting traffic and marketing alliances puts us at a competitive disadvantage, particularly with respect to our appeal to higher-fare business travelers.

The fractional private jet companies and the legacy airlines and low-cost carriers each operate larger fleets of aircraft and have greater financial resources, which would permit them to add service in response to our entry into new markets. Due to our relatively small size, we are more susceptible to fare wars or other competitive activities, which could prevent us from attaining the level of traffic or maintaining the level of sales required to sustain profitable operations.

In 2018 and 2019, respectively, VistaJet acquired XOJET and JetSmarter, combining its heavy jet subscription-based service targeting multinational corporations and ultra-high net worth individuals with XOJET’s super-midsize jet on demand service and JetSmarter’s digital booking platform for business aviation. In addition, during 2020, Wheels Up acquired Delta Private Jets as well as Gama Aviation, a business jet services company and in 2021 Vista Jet acquired a number of smaller players as well as Apollo Jets. Increased consolidation in our industry could further intensify the competitive environment we face.

Intellectual Property

We registered a trademark on our brand name, Jet Token, and our logo, with the United States Patent and Trademark Office. We have also purchased our domain name, jettoken.com and operate our website under that domain. We have an application pending with the United States Patent and Trademark Office for Jet.AI. We are the sole owner of the copyrights in and to the software code underlying our App, CharterGPT and the software code underlying our Jet.AI Operator Platform offerings.

Employees

We have eight (8) full-time employees, including our Executive Chairman and Interim Chief Executive Officer, our Interim Chief Financial Officer, our Chief Operating Officer, and our Chief Marketing Officer.

Regulation

Regulations Applicable to the Ownership and Operation of Our Aircraft

Once we have leased our aircraft, Cirrus, which will maintain and manage our aircraft, is subject to a high degree of regulation that affects our business, including regulations governing aviation activity, safety standards and environmental standards.

U.S. Department of Transportation (“DOT”)

The DOT primarily regulates economic issues affecting air transportation such as the air carrier’s financial and management fitness, insurance, consumer protection and competitive practices. The DOT has the authority to investigate and bring proceedings to enforce its regulations and may assess civil penalties, revoke operating authority, and seek criminal sanctions. Our operating as an air charter carrier is regulated and certificated by the DOT. The DOT authorizes the carrier to engage in on-demand air transportation within the United States, its territories, and possessions. The DOT can suspend or revoke that authority for cause, essentially stopping all operations.

Federal Aviation Administration (“FAA”)

The FAA primarily regulates flight operations, in particular matters affecting air safety, such as airworthiness requirements for aircraft and pilot, mechanic, dispatcher and flight attendant certification. The FAA regulates:

In order to engage in air transportation for hire, each air carrier is required to obtain an FAA operating certificate authorizing the airline to operate using specified equipment in specified types of air service. In the case of our leased aircraft, it is a Part 135 license. The FAA has the authority to modify, suspend temporarily or revoke permanently the authority to provide air transportation for failure to comply with FAA regulations. The FAA can assess civil penalties for such failures or institute proceedings for the imposition and collection of monetary fines for the violation of certain FAA regulations. The FAA can revoke authority to provide air transportation on an emergency basis, without notice and hearing, where significant safety issues are involved. The FAA monitors compliance with maintenance, flight operations and safety regulations, maintains onsite representatives and performs inspections of a carrier’s aircraft, employees and records.

The FAA also has the authority to issue maintenance/airworthiness directives and other mandatory orders relating to aircraft and engines, fire retardant and smoke detection devices, collision and windshear avoidance systems, navigational equipment, noise abatement and the mandatory removal and replacement of aircraft parts that have failed or may fail in the future. FAA enforcement authority over aircraft includes the power to ground aircraft or limit their usage.

Transportation Security Administration (“TSA”)

The TSA is responsible for oversight of passenger and baggage screening, cargo security measures, airport security, assessment and distribution of intelligence and security research and development. Air carriers are subject to TSA mandates and oversight in connection with screening passenger identities and screening baggage. TSA regulations governing passenger identification, which we will apply at the time of the Company purchase as well as at the time of travel, requires all passengers to provide identification using a valid verifying identity document. In addition, all passengers must provide their full name, date of birth, and gender, which is screened against the travel ban watch list in effect at the time of initial screening and at the time of travel.

All air carriers are also subject to certain provisions of the Communications Act of 1934 because of their extensive use of radio and other communication facilities and are required to obtain an aeronautical radio license from the Federal Communications Commission, or the FCC.

Property

We lease space for our corporate headquarters in Las Vegas, Nevada and a satellite office in San Francisco, consisting of office space and the use of shared conference facilities.

DIRECTORS AND EXECUTIVE OFFICERS

The following is a list of our directors and executive officers.

Effective upon the closing of the Business Combination, Michael D. Winston was appointed to serve as Jet.AI’s Executive Chairman and as Jet.AI’s interim Chief Executive Officer (“CEO”) and George Murnane was appointed to serve as Jet.AI’s interim Chief Financial Officer (“CFO”) until Jet.AI completes its ongoing search for a long-term CFO, at which point Mr. Winston will step down from his role as interim CEO and Mr. Murnane will transition from Jet.AI’s interim CFO to its CEO.

Executive Officers

Michael D. Winston, CFA founded Jet Token in 2018 and has served Executive Chairman for Jet Token and Jet.AI since Jet Token’s founding. Upon completion of the Business Combination, he is serving as Interim Chief Executive Officer until such time as the Company hires a permanent Chief Financial Officer. Mr. Winston began his career in 1999 with Credit Suisse First Boston Corporation and later worked as a portfolio manager at Millennium Partners LP. In 2012, Mr. Winston formed the Sutton View group of companies, an alternative asset management platform where he advised one of the largest academic endowments in the world. Mr. Winston received an MBA in Finance and Real Estate from Columbia Business School in 2005, and a BA in Economics from Cornell University in 1999. While at Cornell he studied for a year at the London School of Economics and at age 18 won a $1 million prize from IBM for his first startup company. Mr. Winston is a CFA Charterholder, and a member of the Economic Club of New York. We believe Mr. Winston is qualified to serve as a director because of his operational and historical expertise gained from serving as Jet Token’s Founder and Executive Chairman.

George Murnane served as Jet Token’s Chief Executive Officer since September 2019. Upon completion of the Business Combination, he was named Interim Chief Financial Officer until such time as the Company hires a permanent Chief Financial Officer, at which time he will again assume the role of Chief Executive Officer. Mr. Murnane has over 20 years of senior executive experience, including 14 years as a Chief Operating Officer and/or Chief Financial Officer in the air transportation and aircraft industry, including as Chief Executive Officer for ImperialJet S.a.l from 2013 to 2019, Chief Operating Officer and Acting Chief Financial Officer of VistaJet Holdings, S.A. in 2008, Chief Financial Officer of Mesa Air Group from 2002 to 2007, Chief Operating Officer and Chief Financial Officer of North-South Airways from 2000 to 2002, Executive Vice President, Chief Operating Officer and Chief Financial Officer of International Airline Support Group from 1996 to 2002 and Executive Vice President and Chief Operating Officer of Atlas Air, Inc. from 1995 to 1996. From 2009 until he joined Jet Token, Mr. Murnane was a managing partner of Barlow Partners, a consulting services firm providing operational and financial management, merger and acquisition, financing and restructuring expertise to industrial and financial companies. Mr. Murnane received an MBA from The Wharton School of the University of Pennsylvania and a BA in Economics from the University of Pennsylvania in 1980. We believe Mr. Murnane is qualified to serve as a director because of his expertise gained from serving as Jet Token’s Chief Executive Officer and his extensive financial experience.

Patrick McNulty has served as Jet Token’s Chief Operating Officer since June 2021. Prior to joining Jet Token, Mr. McNulty served as a manager of Sales Operations and Business Development with Honda Aircraft Company. While with Honda Aircraft, Mr. McNulty led the development of a robust sales engineering team and was instrumental in product development and market analysis for the manufacturer. Prior to Honda Aircraft Company, Mr. McNulty worked in the aircraft engine division of Rolls-Royce North America and at light jet manufacturer Eclipse Aviation. Mr. McNulty is a graduate of the Embry-Riddle Aeronautical University (BS Aerospace Engineering, MBA Aviation).

Non-Employee Directors

Wrendon Timothy has been a director of our company since August 2023. He served as Oxbridge’s Chief Financial Officer, Treasurer, Secretary and director since April 2021 until the completion of the Business Combination. He has served as a director, chief financial officer and corporate secretary of Oxbridge Re Holdings Limited (NASDAQ: OXBR), a Cayman Islands based NASDAQ-listed reinsurance holding company. He has served in the positions of chief financial officer and corporate secretary since August 2013 and as a director since November 2021. In his role, he has provided financial and accounting consulting services with a focus on technical and SEC reporting, compliance, internal auditing, corporate governance, mergers & acquisitions analysis, risk management, and CFO and controller services. Mr. Timothy also serves as an executive and director of Oxbridge Reinsurance Limited and Oxbridge Re NS, the wholly-owned licensed reinsurance subsidiaries of Oxbridge Re Holdings Limited. Mr. Timothy also serves as a director of Oxbridge’s Sponsor, OAC Sponsor Ltd, and as a director of SurancePlus Inc., a British Virgin Islands wholly-owned Web3 subsidiary of Oxbridge Re Holdings Limited.

Mr. Timothy started his financial career at PricewaterhouseCoopers (Trinidad) in 2004 as an Associate in their assurance division, performing external and internal audit work, and tax-related services. Throughout his career progression and transitions through KPMG Trinidad and PricewaterhouseCoopers (Cayman Islands), Mr. Timothy has successfully delivered services across both the public and private sectors, spanning insurance and reinsurance, banking, hedge funds, trusts, investment management, manufacturing, beverage, construction, glass, healthcare, retail, construction, marketing, restaurant, software, sports, and tourism industries. Mr. Timothy management roles allowed him to be heavily involved in the planning, budgeting, and leadership of engagement teams, serving as a liaison for senior client management, and advising on technical accounting matters. Mr. Timothy is a Fellow of the Association of Chartered Certified Accountants (ACCA), a Fellow Chartered Corporate Secretary and also holds a Postgraduate Diploma in Business Administration and a Master of Business Administration, with Distinction (with a Specialism in Finance (with Distinction), from Heriot Watt University in Edinburg, Scotland. Mr. Timothy holds directorship and leadership roles with a number of privately-held companies, and also serves on various not-for-profit organizations, including his governance role as Chairman of Audit & Risk Committee of The Utility Regulation & Competition Office of the Cayman Islands, and Audit Committee Chairman of the Cayman Islands Conference of SDA. Mr. Timothy is an active Fellow Member of the ACCA, an active member of the Cayman Islands Institute of Professional Accountants (CIIPA), an active Fellow Member of the Chartered Governance Institute (formerly the Institute of Chartered Secretaries and Administrators) and a member of the Cayman Islands Directors Association.

We believe that Mr. Timothy is qualified to serve as a director because of his extensive capital markets experience and significant expertise across a wide array of corporate matters.

William L. Yankus has been a director of our company since August 2023. He served as one of Oxbridge’s independent directors since August 2021. Mr. Yankus is an experienced investment banking specialist with a demonstrated history of working in the insurance industry. Since July 2015, Mr. Yankus has served as Founder and Principal of Pheasant Hill Advisors, LLC, a New York based advisor firm that provides various research, advisory, private equity capital raising and M&A services primarily to the insurance industry and insurance industry investors. Since March 2016, Mr. Yankus has served on the board of directors of Kingstone Companies, Inc. (NASDAQ: KINS), a New York based NASDAQ-listed property and casualty insurance company. He has also served as the Chairman of Kingstone’s Compensation Committee since April 2017, and as the Chairman of Kingstone’s Investment Committee since February 2020. Mr. Yankus is also a Senior Advisor at Independent Insurance Analysts LLC, which provides investment analysis, credit research and investment banking services related to the life insurance industry.

From September 2011 to June 2015, Mr. Yankus served as Managing Director for Sterne Agee, one of the oldest privately owned financial services firm in the USA. Sterne Agee offered wealth management and investment services to a diverse client base and custodies nearly $26 billion in client assets. Prior to Sterne Agee, Mr. Yankus also held executive and leadership roles with other reputable financial services and investment banking firms, including serving as Head of Insurance Research at Macquarie Group from December 2009 to November 2010, Managing Director-Insurance Research for Fox-Pitt, Kelton from May 1993 to November 2009, and Vice President, Insurance Research at Conning & Company from June 1985 to Apr 1993. He completed the CFA program in 1989 and passed the CT uniform CPA exam in 1984. He received his B.A. degree in Economics and Accounting from The College of the Holy Cross.

Mr. Yankus brings significant leadership, insurance, public company, mergers & acquisitions, corporate governance and investment banking experience to our Board of Directors.

Ehud Talmor (Maj. IAF Ret.) has been a director of our company since August 2023. He is a decorated, retired, senior officer from the Israeli Air Force with over twenty-five years of experience in all aspects of air combat and aircraft logistics. He began his career in 1995 as a fighter pilot and later, flight instructor. He subsequently took on a variety of supervisory roles, including F-16 deputy squadron commander. In 2007, he joined the Acquisitions Department of the Israeli Ministry of Defense and later held the position of Project Manager for three separate Air Force jet acquisition projects. The jet acquisition projects were: (1) the Beechcraft T-6II, (2) the Leonardo M-346, and (3) the Lockheed Martin F-35A. In addition to serving as Project Manager for the F-35 program, Mr. Talmor was also the Israeli Air Force’s Chief Instructor for the F-35. Mr. Talmor graduated from I.D.C. Herzliya with a B.A. in Psychology. We believe Mr. Talmor is qualified to serve as a director because of his considerable aviation industry, business and project management experience.

Lt. Col. Ran David (IAF) has been a director of our company since August 2023. He is a decorated combat pilot in the Israeli Air Force. He has served as a deputy squadron commander and spent ten years as a flight instructor. One of Lt. Col David’s primary responsibilities has been to train, test and approve new IAF fighter pilots. Lt. Col David is a graduate of the USAF Air Command and Staff College and the University of Haifa. Lt. Col David is qualified to serve as a director because of his considerable aviation industry and pilot training experience.

Donald Jeffrey Woods has been a director of our company since August 2023. He is currently the Co-Founder and Chief Product Officer of Puzl LLC, a company using artificial intelligence to transform retail. He also currently serves as President and Board Member of Woods Supermarket, Inc., a mid-sized family-owned chain of supermarkets operating across Missouri, which has been serving its communities for over 75 years. Prior to these roles, from 2011 to 2019, Mr. Woods served in roles of Vice President of Marketing Strategy and Chief Product Strategist with SAP SE (NYSE: SAP) in London and New York. From 2001 to 2011, Mr. Woods served as Vice President of Enterprise Applications Research at Gartner Inc (NYSE: IT) where he was the global lead for enterprise applications. Prior to this, Mr. Woods built and sold his own logistics company. Mr. Woods is a graduate of Cornell University in Applied Economics and holds an MBA from Columbia Business School. Mr. Woods is qualified to serve as a director because of his considerable technology development, artificial intelligence, business and marketing experience.

Family Relationships

There are no familial relationships among the Jet.AI directors and executive officers.

Board Composition

The Board is comprised of seven directors and is divided into three classes with staggered three-year terms. At each annual meeting of stockholders, the successors to directors whose terms then expire will be elected to serve from the time of election and qualification until the third annual meeting following election. Jet.AI’s directors are among the three classes as follows:

Directors in a particular class are elected for three-year terms at the annual meeting of stockholders in the year in which their terms expire. As a result, only one class of directors is elected at each annual meeting of Jet.AI stockholders, with the other classes continuing for the remainder of their respective three-year terms. Each director’s term continues until the election and qualification of his or her successor, or the earlier of his or her death, resignation or removal. This classification of the Board may have the effect of delaying or preventing changes in Jet.AI’s control or management.

The Company’s Certificate of Incorporation and Bylaws provide that only the Board can fill vacant directorships, including newly-created seats. Any additional directorships resulting from an increase in the authorized number of directors would be distributed pro rata among the three classes so that, as nearly as possible, each class would consist of one-third of the authorized number of directors. The Certificate of Incorporation and Bylaws also provide that Jet.AI’s directors may only be removed for cause and by the affirmative vote of the holders of at least two-thirds of the voting power of the then-outstanding shares entitled to vote in the election of directors, voting together as a single class.

Director Independence

The Board determined that each of the directors serving on the Board, other than Michael Winston and George Murnane, qualifies as an independent director, as defined under the listing rules of Nasdaq, and the Board consists of a majority of “independent directors,” as defined under the applicable rules of the SEC and Nasdaq relating to director independence requirements. In addition, Jet.AI is subject to certain rules of the SEC and Nasdaq relating to the membership, qualifications and operations of the audit committee, as discussed below.

Board Leadership Structure

The Board does not have a policy requiring the positions of the Chairperson of the board of directors and Chief Executive Officer to be separate or held by the same individual. The members of the Board believe that this determination should be based on circumstances existing from time to time, based on criteria that are in Jet.AI’s best interests and the best interests of its stockholders, including the composition, skills and experience of the board and its members, specific challenges faced by Jet.AI or the industry in which it operates and governance efficiency. The Board adopted Corporate Governance Guidelines, which provide for the appointment of a lead independent director at any time when the Chairperson is not independent. Wrendon Timothy serves as the lead independent director.

Board Committees

The Board has established an audit committee, a compensation committee and a nominating and corporate governance committee, each of which have the composition and responsibilities described below. The Board and its committees will set schedules for meeting throughout the year and can also hold special meetings and act by written consent from time to time, as appropriate. The Board will delegate various responsibilities and authority to its committees and the committees will regularly report on their activities and actions to the full board of directors. Members will serve on these committees until their resignation or until otherwise determined by the Board. The Board may establish other committees to facilitate the management of the Company’s business as it deems necessary or appropriate from time to time.

Each committee of the Board will operate under a written charter approved by the Board. Copies of each charter are posted on the Investor Relations section of Jet.AI’s website at investors.jet.ai. The inclusion of the Company’s website address or the reference to Jet.AI’s website in this prospectus does not include or incorporate by reference the information on the Company’s website into this prospectus.

Audit Committee

Jet.AI’s audit committee is comprised of Wrendon Timothy, William Yankus and Ehud Talmor, with Mr. Timothy serving as audit committee chairperson. The Board determined that Messrs. Timothy, Yankus and Talmor each meet the requirements for independence and financial literacy under the current Nasdaq listing standards and SEC rules and regulations, including Rule 10A-3. In addition, the Board determined that each of Messrs. Timothy and Yankus is an “audit committee financial expert” within the meaning of Item 407(d) of Regulation S-K promulgated under the Securities Act. This designation does not impose any duties, obligations or liabilities that are greater than are generally imposed on members of the audit committee and the Board. The audit committee will be responsible for, among other things:

The audit committee operates under a written charter, which satisfies the applicable rules of the SEC and the listing standards of Nasdaq, and which is available on Jet.AI’s website. All audit services to be provided to Jet.AI and all permissible non-audit services, other than de minimis non-audit services, to be provided to Jet.AI by Jet.AI’s independent registered public accounting firm will be approved in advance by the audit committee.

Compensation Committee

Jet.AI’s compensation committee is comprised of Lt. Col. Ran David, Wrendon Timothy and Ehud Talmor, and Mr. Talmor is the chairperson of the compensation committee. The Board determined that each member of the compensation committee meets the requirements for independence under the current Nasdaq listing standards and SEC rules and regulations. Each member of the committee is a non-employee director, as defined in Rule 16b-3 promulgated under the Exchange Act. The compensation committee is responsible for, among other things: