Company: CXAI
Filing Date: 2025-04-07
Form Type: 10-K
Source: 0001829126-25-002438
Chunk: 428

Company: CXApp Inc.
Filing Date: 2025-04-07
Form: 10-K
Item: Item 2
Chunk 428
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 as of December 31, 2024.

Uncertain Tax Positions

The Company records tax positions as liabilities and adjusts these liabilities when its judgment changes because of the evaluation of new information not previously available. Because of the complexity of some of these uncertainties, the ultimate resolution may result in a payment that is materially different from the Company’s current estimate of the recognized tax benefit liabilities. These differences will be reflected as increases or decreases to income tax expense in the period in which new information is available. As of December 31, 2024, and the period March 15, 2023, to December 31, 2023 (Successor) the Company has not recorded any liabilities for uncertain tax positions in its consolidated financial statements.

    F-37

The Company records
interest and penalties related to unrecognized tax benefits in the provision for income taxes. As of December 31, 2024 and the
period March 15, 2023 to December 31, 2023 (Successor), no accrued interest or penalties are recorded on the balance sheets, and the Company
has not recorded any related expenses. The Company files tax returns as prescribed by the tax laws of the jurisdictions in which it
operates. In the normal course of business, the Company is subject to examinations by federal, foreign, and state and local
jurisdictions, where applicable. There are currently no pending tax examinations. The Company’s tax years currently open under
statute range from 2021 to the present in the U.S. and from 2020 to the present in its foreign operations. To the extent the Company has tax attribute carryforwards, the tax years in which those attributes were generated may remain subject to
adjustment upon examination by the Internal Revenue Service, state and local tax authorities, and non-U.S. tax authorities—including
those in Canada and the Philippines—if and when the attributes are utilized in a future period.

Following the acquisition, the Company transitioned its Canadian operations
from a client-facing business to a cost center. A formal transfer pricing study between the U.S. and Canada has not been performed, and
as such, there may be a potential for a Canadian tax liability. However, based on currently available information, management believes that
any such liability would not be material to the financial statements as a whole.

NOTE 15 – Credit Risk and Concentrations

Financial instruments that
subject the Company to credit risk consist principally of trade accounts receivable and cash and cash equivalents. The Company