Company: CXAI
Filing Date: 2025-04-08
Form Type: 424B3
Source: 0001829126-25-002456
Chunk: 81

Company: CXApp Inc.
Filing Date: 2025-04-08
Form: 424B3
Chunk 81
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.A. Quantitative and Qualitative Disclosure About Market Risk.

We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information otherwise required under this item.

Item 8. Consolidated Financial Statements and Supplementary Data.

This information appears following Item 15 of this Report and is included herein by reference.

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

None.

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Item 9.A. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of December 31, 2024. Based on this evaluation, management concluded that our disclosure controls and procedures were not effectiveas of that date due to the material weaknesses in internal control over financial reporting described below.

Material Weaknesses Identified

During the year ended December 31, 2024, management identified the following material weaknesses:

| ● | Tax Accounting Controls: The Company did not maintain effective controls to ensure the completeness and accuracy of income tax accruals, particularly related to state tax liabilities. |

| ● | Expense Accrual Process: A significant year-end adjustment for legal fees revealed deficiencies in our period-end accrual processes and related management review controls. |

| ● | Fair                                                                                                                                                                    
 Value Election for Financial Instruments: Managements lack of identification of the embedded derivatives requirement bifurcation                                        
 and measurement at fair value. The Company did not appropriately assess or document the fair value option for a financial instrument, resulting in an adjustment to the 
 financial statements                                                                                                                                                    |

As a result of these material weaknesses, the Company concluded that previously issued interim financial statements for the quarters ended June 30, 2024 and September 30, 2024 required restatement. These issues reflect deficiencies in internal control over financial reporting that impacted our disclosure controls and procedures. The material weakness as of December 31, 2023 related to the impairment of goodwill has been remediated.

Despite the identified weaknesses, management believes that the consolidated financial statements included in this Annual Report on Form 10-K present fairly, in all material respects, our financial position, results of operations, and cash flows in accordance with U.S. generally accepted accounting principles.

Remediation Plan

To address these material weaknesses,