Company: CXAI
Filing Date: 2025-03-07
Form Type: 424B3
Source: 0001829126-25-001566
Chunk: 12

Company: CXApp Inc.
Filing Date: 2025-03-07
Form: 424B3
Chunk 12
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 thereto should be read in conjunction with the
audited financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2023, which was filed with the
SEC on May 23, 2024.

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CXAPP INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS</div>

Principles of Consolidation

The accompanying condensed consolidated financial
statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany balances have been eliminated in consolidation.

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America (“U.S. 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 statements and the reported amounts of revenues and expenses during each of the reporting periods. Actual results could differ from those estimates. The Company’s significant estimates consist of:

| ● | the valuation of stock-based compensation; |

| ● | the valuation of warrant liabilities; |

| ● | the allowance for credit losses; |

| ● | the valuation allowance for deferred tax assets; and |

| ● | impairment of long-lived assets and goodwill. |

Cash and Cash Equivalents

Cash and cash equivalents consist of cash, checking accounts, money market accounts, and certificates of deposit with maturities of three
months or less when purchased. As of September 30, 2024 (Successor), the Company had cash equivalents of approximately $4,688 thousand of certificates of deposit held
by a number of banks limited to $250 thousand per bank with a duration of 90 days or less. As of December 31, 2023 (Successor), the Company
had approximately $5,584 thousand in cash equivalents.

Accounts Receivable, net and Allowance for Credit Losses

Accounts receivables are stated at the amount
the Company expects to collect. The Company recognizes an allowance for credit losses to ensure accounts receivables are not
overstated due to uncollectability. Allowance for credit losses are maintained for various customers based on a variety of factors,
including the length of time the receivables are past due, significant one-time events and historical experience. An additional
reserve for individual accounts is recorded when the Company becomes aware of a customer’s inability to meet its financial
obligation