# EDGAR Filing Document

**Accession Number:** 0001861622
**File Stem:** 0001493152-25-023406
**Filing Date:** 2025-11
**Character Count:** 176352
**Document Hash:** 39d7aa57637180821cfcbc83b9c25cf2
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001493152-25-023406.hdr.sgml**: 20251114

**ACCESSION NUMBER**: 0001493152-25-023406

**CONFORMED SUBMISSION TYPE**: 10-Q

**PUBLIC DOCUMENT COUNT**: 57

**CONFORMED PERIOD OF REPORT**: 20250930

**FILED AS OF DATE**: 20251114

**DATE AS OF CHANGE**: 20251114

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Jet.AI Inc.
- **CENTRAL INDEX KEY:** 0001861622
- **STANDARD INDUSTRIAL CLASSIFICATION:** AIR TRANSPORTATION, NONSCHEDULED [4522]
- **ORGANIZATION NAME:** 01 Energy & Transportation
- **EIN:** 000000000
- **STATE OF INCORPORATION:** DE
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 10-Q
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-40725
- **FILM NUMBER:** 251485606

**BUSINESS ADDRESS:**
- **STREET 1:** 10845 GRIFFITH PEAK DR.,
- **STREET 2:** SUITE 200
- **CITY:** LAS VEGAS
- **STATE:** NV
- **ZIP:** 89135
- **BUSINESS PHONE:** 702-747-4000

**MAIL ADDRESS:**
- **STREET 1:** 10845 GRIFFITH PEAK DR.,
- **STREET 2:** SUITE 200
- **CITY:** LAS VEGAS
- **STATE:** NV
- **ZIP:** 89135

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** Oxbridge Acquisition Corp.
- **DATE OF NAME CHANGE:** 20210511

?xml version='1.0' encoding='ASCII'?

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

**FORM 10-Q**

☒ **QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**

**For the quarterly period ended September 30, 2025**

**Or**

☐ **TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**

**For the transition period from ________ to ________**

**Commission file number: 001-40725**

**Jet.AI Inc.**

**(Exact Name of Registrant As Specified In Its Charter)**

---

| | |
|:---|:---|
| **Delaware** | **93-2971741** |
| **(State or other jurisdiction of** | **(I.R.S. Employer** |
| **incorporation or organization)** | **Identification No.)** |

---

---

| | |
|:---|:---|
| **10845 Griffith Peak Dr.**<br> **Suite 200**<br> **Las Vegas, NV**  | **89135** |
| **(Address of Principal Executive Offices)** | **(ZIP Code)** |

---

**(702) 747-4000**

**(Registrant's telephone number, including area code)**

---

| |
|:---|
| **N/A** |
| **(Former name, former address and former fiscal year, if changed since last report)** |

---

**Securities to be registered under Section 12(b) of the Act:**

---

| | | |
|:---|:---|:---|
| **Title of each class** | **Trading Symbol(s)** | **Name of each exchange on which registered** |
| Common Stock, par value $0.0001 per share | JTAI | The Nasdaq Stock Market LLC |

---

**Indicate by check mark whether the registrant (1) has filed reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐**

**Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐**

**Indicate by check mark whether the Company is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definition of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.**

---

| | |
|:---|:---|
| **Large accelerated filer ☐** | **Accelerated filer ☐** |
| **Non-accelerated filer ☒** | **Smaller reporting company ☒** |
|  | **Emerging growth company ☒** |

---

**If an emerging growth company, indicate by check mark if the Company has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ☐**

**Indicate by checkmark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒**

**As of November 12, 2025, there were 3,927,256 shares of the Company's common stock, par value $0.0001, issued and outstanding.**

**TABLE OF CONTENTS**

---

| | | |
|:---|:---|:---|
|  |  | **Page** |
| **PART 1** | **[FINANCIAL INFORMATION](#a_001)** | 1 |
| **Item 1** | **[Financial Statements](#a_002)** | 1 |
|  | **[Consolidated Balance Sheets at September 30, 2025 (unaudited) and December 31, 2024](#a_003)** | 1 |
|  | **[Consolidated Statements of Operations for the Three and Nine months Ended September 30, 2025 and 2024 (unaudited)](#a_004)** | 2 |
|  | **[Consolidated Statements of Stockholders' Equity (Deficit) for the Three and Nine months Ended September 30, 2025 and 2024 (unaudited)](#a_005)** | 3 |
|  | **[Consolidated Statements of Cash Flows for the Nine months Ended September 30, 2025 and 2024 (unaudited)](#a_006)** | 4 |
|  | **[Notes to Consolidated Financial Statements](#a_007)** | 5 |
| **Item 2** | **[Management's Discussion and Analysis of Financial Condition and Results of Operations](#a_008)** | 23 |
| **Item 3** | **[Quantitative and Qualitative Disclosures About Market Risk](#a_009)** | 38 |
| **Item 4** | **[Controls and Procedures](#a_010)** | 38 |
| **PART II** | **[OTHER INFORMATION](#a_011)** | 39 |
| **Item 1** | **[Legal Proceedings](#a_012)** | 39 |
| **Item 1A** | **[Risk Factors](#a_013)** | 39 |
| **Item 2** | **[Unregistered Sales of Equity Securities and Use of Proceeds](#a_014)** | 39 |
| **Item 3** | **[Defaults Upon Senior Securities](#a_016)** | 39 |
| **Item 4** | **[Mine Safety Disclosures](#a_017)** | 39 |
| **Item 5** | **[Other Information](#a_018)** | 40 |
| **Item 6** | **[Exhibits](#a_019)** | 40 |
|  | **[Signatures](#a_020)** | 41 |

---

***In this Form 10-Q, unless otherwise specified, the term "Jet.AI", "we", "us", "our", or "the Company" refers to Jet.AI Inc. and our subsidiaries on a consolidated basis.***

**THIS QUARTERLY REPORT ON FORM 10-Q MAY CONTAIN FORWARD-LOOKING STATEMENTS AND INFORMATION RELATING TO, AMONG OTHER THINGS, THE COMPANY, ITS BUSINESS PLAN AND STRATEGY, AND ITS INDUSTRY. THESE FORWARD-LOOKING STATEMENTS ARE BASED ON THE BELIEFS OF, ASSUMPTIONS MADE BY, AND INFORMATION CURRENTLY AVAILABLE TO THE COMPANY'S MANAGEMENT. WHEN USED IN THIS QUARTERLY REPORT, THE WORDS "ESTIMATE," "PROJECT," "BELIEVE," "ANTICIPATE," "INTEND," "EXPECT" AND SIMILAR EXPRESSIONS OF A FUTURE OR FORWARD-LOOKING NATURE ARE INTENDED TO IDENTIFY FORWARD-LOOKING STATEMENTS. THESE STATEMENTS REFLECT MANAGEMENT'S CURRENT VIEWS WITH RESPECT TO FUTURE EVENTS AND ARE SUBJECT TO RISKS AND UNCERTAINTIES THAT COULD CAUSE THE COMPANY'S ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE CONTAINED IN THE FORWARD-LOOKING STATEMENTS. INVESTORS ARE CAUTIONED NOT TO PLACE UNDUE RELIANCE ON THESE FORWARD-LOOKING STATEMENTS, WHICH SPEAK ONLY AS OF THE DATE ON WHICH THEY ARE MADE. THE COMPANY DOES NOT UNDERTAKE ANY OBLIGATION TO REVISE OR UPDATE THESE FORWARD-LOOKING STATEMENTS TO REFLECT EVENTS OR CIRCUMSTANCES AFTER SUCH DATE OR TO REFLECT THE OCCURRENCE OF UNANTICIPATED EVENTS.**

**PART I FINANCIAL INFORMATION**

**Item 1. FINANCIAL STATEMENTS**

**JET.AI INC.**

**CONSOLIDATED BALANCE SHEETS**

**(UNAUDITED)**

---

| | | |
|:---|:---|:---|
|  | **September 30, 2025** | **December 31, 2024** |
| Assets |  |  |
| Current assets: |  |  |
| &nbsp;&nbsp;&nbsp;Cash and cash equivalents | $3475410 | $5872627 |
| &nbsp;&nbsp;&nbsp;Accounts receivable | 194948 | 132230 |
| &nbsp;&nbsp;&nbsp;Note receivable - related party | 236790 |  |
| &nbsp;&nbsp;&nbsp;Deferred offering costs | 45000 |  |
| &nbsp;&nbsp;&nbsp;Other current assets | 259566 | 357751 |
| &nbsp;&nbsp;&nbsp;Refundable capital contribution | 2660000 | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current assets | 6871714 | 6362608 |
| Property and equipment, net | 3143 | 5055 |
| Intangible assets, net | 86745 | 86745 |
| Right-of-use lease asset | 645099 | 1048354 |
| Investment in joint venture | 400000 | 100000 |
| Deposit on aircraft | 4050000 | 2400000 |
| Deposits and other assets | 835561 | 794561 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total assets | $12892262 | $10797323 |
| Liabilities and Stockholders' Equity |  |  |
| Current liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;Accounts payable | $903413 | $280450 |
| &nbsp;&nbsp;&nbsp;Accrued liabilities | 1688172 | 1663338 |
| &nbsp;&nbsp;&nbsp;Deferred revenue | 443015 | 1319746 |
| &nbsp;&nbsp;&nbsp;Operating lease liability | 537491 | 525547 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current liabilities | 3572091 | 3789081 |
| &nbsp;&nbsp;&nbsp;Lease liability, net of current portion | 91158 | 495782 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total liabilities | 3663249 | 4284863 |
| Commitments and contingencies (Note 2, 6, and 7) |  |  |
| Stockholders' Equity |  |  |
| &nbsp;&nbsp;&nbsp;Preferred Stock, 4,000,000 shares authorized, par value $0.0001, 0 issued and outstanding |  |  |
| &nbsp;&nbsp;&nbsp;Series B Convertible Preferred Stock, 5,000 shares authorized, par value $0.0001, 989 and 250 issued and outstanding |  |  |
| &nbsp;&nbsp;&nbsp;Common stock, 200,000,000 shares authorized, par value $0.0001, 3,501,701 and 1,629,861 issued and outstanding | 350 | 162 |
| &nbsp;&nbsp;&nbsp;Subscription receivable | (6724) | (6724) |
| &nbsp;&nbsp;&nbsp;Additional paid-in capital | 69302341 | 59065100 |
| &nbsp;&nbsp;&nbsp;Accumulated deficit | (60066954) | (52546078) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total stockholders' equity | 9229013 | 6512460 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total liabilities and stockholders' equity | $12892262 | $10797323 |

---

See accompanying notes to consolidated financial statements

**JET.AI INC.**

**CONSOLIDATED STATEMENTS OF OPERATIONS**

**(UNAUDITED)**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended** | **Three Months Ended** | **Nine Months Ended** | **Nine Months Ended** |
|  | **September 30,** | **September 30,** | **September 30,** | **September 30,** |
|  | **2025** | **2024** | **2025** | **2024** |
| Revenues | $1710988 | $3917393 | $7411526 | $10849875 |
| Cost of revenues | 1999395 | 3931279 | 7925747 | 11405113 |
| Gross loss | (288407) | (13886) | (514221) | (555238) |
| Operating Expenses: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;General and administrative (including stock-based compensation of $175,586, $1,313,358, $1,489,654, and $3,714,404, respectively) | 1408391 | 2746783 | 6307798 | 7956830 |
| &nbsp;&nbsp;&nbsp;Sales and marketing | 300072 | 83310 | 676081 | 632380 |
| &nbsp;&nbsp;&nbsp;Research and development | 39327 | 37959 | 189295 | 107901 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total operating expenses | 1747790 | 2868052 | 7173174 | 8697111 |
| &nbsp;&nbsp;&nbsp;Operating loss | (2036197) | (2881938) | (7687395) | (9252349) |
| Other (income) expense: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Interest expense |  |  |  | 79314 |
| &nbsp;&nbsp;&nbsp;Other income | (70148) | (56) | (166519) | (176) |
| Total other (income) expense | (70148) | (56) | (166519) | 79138 |
| Loss before provision for income taxes | (1966049) | (2881882) | (7520876) | (9331487) |
| Provision for income taxes | - | - | - | - |
| &nbsp;&nbsp;&nbsp;Net Loss | $(1966049) | $(2881882) | $(7520876) | $(9331487) |
| &nbsp;&nbsp;&nbsp;Deemed dividend from warrant exchange offer |  | (540255) |  | (540255) |
| &nbsp;&nbsp;&nbsp;Cumulative preferred stock dividends | - | 18708 | - | 78163 |
| &nbsp;&nbsp;&nbsp;Net Loss to common stockholders | $(1966049) | $(3440845) | $(7520876) | $(9949905) |
| Weighted average shares outstanding - basic and diluted | 3334744 | 78523 | 2659129 | 71791 |
| Net loss per share - basic and diluted | $(0.59) | $(43.82) | $(2.83) | $(138.60) |

---

See accompanying notes to consolidated financial statements

**JET.AI INC.**

**CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY**

**THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2025 AND 2024**

**(UNAUDITED)**

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Series B<br> Preferred Stock** | **Series B<br> Preferred Stock** | **Common Stock** | **Common Stock** | | | | |
|  | **Shares** | **Amount** | **Shares** | **Amount** | **Subscription**<br>**Receivable** | **Additional<br> Paid-in**<br>**Capital** | **Accumulated**<br>**Deficit** | **Total Stockholders'**<br>**Equity** |
| Balance at December 31, 2024 | 250 | $- | 1629861 | $162 | $(6724) | $59065100 | $(52546078) | 6512460 |
| Stock-based compensation |  |  | 25485 | 3 |  | 550933 |  | 550936 |
| Issuance of Series B Convertible Preferred Stock upon exercise of warrants | 1100 |  |  |  |  | 11000000 |  | 11000000 |
| Series B Preferred Stock conversion | (50) | &nbsp;&nbsp;&nbsp;&nbsp; - | 532100 | 53 |  | (53) |  |  |
| Offering costs |  |  |  |  |  | (1270000) |  | (1270000) |
| Net loss | - | - | - | - | - | - | (3169804) | (3169804) |
| Balance at March 31, 2025 (unaudited) | 1300 | $- | 2187446 | $218 | $(6724) | $69345980 | $(55715882) | $13623592 |
| Stock-based compensation |  |  | 145000 | 15 |  | 763117 |  | 763132 |
| Series B Preferred Stock conversion | (311) |  | 929255 | 93 |  | (93) |  |  |
| Offering costs |  |  |  |  |  | (675000) |  | (675000) |
| Net loss | - | - | - | - | - | - | (2385023) | (2385023) |
| Balance at June 30, 2025 (unaudited) | 989 | $- | 3261701 | $326 | $(6724) | $69434004 | $(58100905) | $11326701 |
| Stock-based compensation |  |  |  |  |  | 175586 |  | 175586 |
| Series B Preferred Stock conversion |  |  | 240000 | 24 |  | (24) |  |  |
| Offering costs |  |  |  |  |  | (307225) |  | (307225) |
| Net loss | - | - | - | - | - | - | (1966049) | (1966049) |
| Balance at September 30, 2025 (unaudited) | 989 | $- | 3501701 | $350 | $(6724) | $69302341 | $(60066954) | $9229013 |

---

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Series B Preferred Stock** | **Series B Preferred Stock** | **Common Stock** | **Common Stock** | | | | |
|  | **Shares** | **Amount** | **Shares** | **Amount** | **Subscription**<br>**Receivable** | **Additional Paid-in**<br>**Capital** | **Accumulated**<br>**Deficit** | **Total Stockholders'<br> (Deficit)**<br>**Equity** |
| Balance at December 31, 2023 |  | $&nbsp;&nbsp;&nbsp;&nbsp; - | 43353 | $&nbsp;&nbsp;&nbsp;&nbsp;4 | $(6724) | $35343069 | $(39272388) | $(3936039) |
| &nbsp;&nbsp;&nbsp;Stock-based compensation |  |  |  |  |  | 1199318 |  | 1199318 |
| &nbsp;&nbsp;&nbsp;Sale of Series B Convertible Preferred Units | 150 |  | 1111 |  |  | 1500025 |  | 1500025 |
| &nbsp;&nbsp;&nbsp;Offering costs |  |  |  |  |  | (155000) |  | (155000) |
| &nbsp;&nbsp;&nbsp;Issuance of Common Stock upon exercise of warrants |  |  | 6892 | 1 |  | 742473 |  | 742474 |
| &nbsp;&nbsp;&nbsp;Sale of Common Stock for cash |  |  | 4444 |  |  | 1110000 |  | 1110000 |
| &nbsp;&nbsp;&nbsp;Net loss | - | - | - | - | - | - | (3229049) | (3229049) |
| Balance at March 31, 2024 (unaudited) | 150 | $- | 55800 | $5 | $(6724) | $39739885 | $(42501437) | $(2768271) |
| &nbsp;&nbsp;&nbsp;Stock-based compensation |  |  |  |  |  | 1201728 |  | 1201728 |
| &nbsp;&nbsp;&nbsp;Sale of Common Stock for cash |  |  | 9778 | 1 |  | 617278 |  | 617279 |
| &nbsp;&nbsp;&nbsp;Net loss | - | - | - | - | - | - | (3220556) | (3220556) |
| Balance at June 30, 2024 (unaudited) | 150 | $- | 65578 | $6 | $(6724) | $41558891 | $(45721993) | $(4169820) |
| &nbsp;&nbsp;&nbsp;Stock-based compensation | 50 |  | 889 |  |  | 1313358 |  | 1313358 |
| &nbsp;&nbsp;&nbsp;Issuance of Common Stock for settlement of accounts payable and accrued liabilities |  |  | 18667 | 2 |  | 411670 |  | 411672 |
| &nbsp;&nbsp;&nbsp;Issuance of Common Stock from warrant exchange |  |  | 53535 | 5 |  | 540250 | (540255) |  |
| &nbsp;&nbsp;&nbsp;Series A Preferred Stock conversion |  |  | 10167 | 1 |  | 551987 |  | 551988 |
| &nbsp;&nbsp;&nbsp;Offering costs |  |  |  |  |  | (253433) |  | (253433) |
| &nbsp;&nbsp;&nbsp;Net loss | - | - | - | - | - | - | (2881882) | (2881882) |
| Balance at September 30, 2024 (unaudited) | 200 | $- | 148836 | $14 | $(6724) | $44122723 | $(49144130) | $(5028117) |

---

See accompanying notes to consolidated financial statements

**JET.AI INC.**

**CONSOLIDATED STATEMENTS OF CASH FLOWS**

**(UNAUDITED)**

---

| | | |
|:---|:---|:---|
|  | **Nine Months Ended** | **Nine Months Ended** |
|  | **September 30,** | **September 30,** |
|  | **2025** | **2024** |
| **CASH FLOWS FROM OPERATING ACTIVITIES:** |  |  |
| &nbsp;&nbsp;&nbsp;Net loss | $(7520876) | $(9331487) |
| &nbsp;&nbsp;&nbsp;Adjustments to reconcile net loss to net cash used in operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization and depreciation | 1912 | 1920 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization of debt discount |  | 80761 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stock-based compensation | 1489654 | 3714404 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Non-cash operating lease costs | 403255 | 391665 |
| &nbsp;&nbsp;&nbsp;Changes in operating assets and liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable | (62718) | (71162) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other current assets and refundable capital contribution | (2561815) | 111668 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred offering costs | (45000) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable | 622963 | 410766 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued liabilities | 24834 | 804947 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred revenue | (876731) | (572925) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating lease liability | (392680) | (381090) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash used in operating activities | (8917202) | (4840533) |
| **CASH FLOWS FROM INVESTING ACTIVITIES:** |  |  |
| &nbsp;&nbsp;&nbsp;Advances under related party promissory note | (236790) |  |
| &nbsp;&nbsp;&nbsp;Purchase of intangible assets |  | (12922) |
| &nbsp;&nbsp;&nbsp;Investment in joint venture | (300000) |  |
| &nbsp;&nbsp;&nbsp;Deposit on aircraft | (1650000) |  |
| &nbsp;&nbsp;&nbsp;Deposits and other assets | (41000) | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash used in investing activities | (2227790) | (12922) |
| **CASH FLOWS FROM FINANCING ACTIVITIES:** |  |  |
| &nbsp;&nbsp;&nbsp;Repayments of notes payable |  | (371250) |
| &nbsp;&nbsp;&nbsp;Repayments of related party notes payable |  | (297500) |
| &nbsp;&nbsp;&nbsp;Offering costs | (2252225) | (236233) |
| &nbsp;&nbsp;&nbsp;Proceeds from exercise of common stock warrants |  | 742474 |
| &nbsp;&nbsp;&nbsp;Proceeds from exercise of Series B Convertible Preferred Stock warrants | 11000000 |  |
| &nbsp;&nbsp;&nbsp;Proceeds from sale of Series B Preferred Stock |  | 1500025 |
| &nbsp;&nbsp;&nbsp;Proceeds from sale of Common Stock | - | 1727279 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash provided by financing activities | 8747775 | 3064795 |
| &nbsp;&nbsp;&nbsp;Decrease in cash and cash equivalents | (2397217) | (1788660) |
| &nbsp;&nbsp;&nbsp;Cash and cash equivalents, beginning of period | 5872627 | 2100543 |
| &nbsp;&nbsp;&nbsp;Cash and cash equivalents, end of period | $3475410 | $311883 |
| &nbsp;&nbsp;&nbsp;Supplemental disclosures of cash flow information: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash paid for interest | $- | $79314 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash paid for income taxes | $- | $- |
| &nbsp;&nbsp;&nbsp;Non-cash financing activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Issuance of Common Stock for Series A Preferred Stock conversion | $- | $551988 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Issuance of Common Stock for Series B Preferred Stock conversion | $170 | $- |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Issuance of Common Stock from warrant exchange | $- | $540255 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Issuance of Common Stock for settlement of accounts payable | $- | $239472 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Decrease in prepaid offering costs and accrued liabilities from issuance of common stock | $- | $172200 |

---

See accompanying notes to consolidated financial statements

**JET.AI INC.**

**NOTES TO CONSOLIDATED FINANCIAL STATEMENTS**

**NOTE 1 – ORGANIZATION AND NATURE OF OPERATIONS**

Jet.AI Inc., formerly known as Oxbridge Acquisition Corp. ("Jet.AI" or the "Company"), was incorporated as a Cayman Islands exempted company on April 12, 2021. The Company was incorporated for the purpose of effecting a merger, capital stock or share exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. Jet Token, Inc. was formed on June 4, 2018 in the State of Delaware and is headquartered in Las Vegas, Nevada.

On August 10, 2023, the Company consummated the business combination transaction ("Business Combination") pursuant to the Business Combination Agreement and Plan of Reorganization (the "Business Combination Agreement") with OXAC Merger Sub I, Inc., a Delaware corporation and a direct wholly owned subsidiary of the Company ("First Merger Sub"), Summerlin Aviation LLC (f/k/a OXAC Merger Sub II, LLC), a Delaware limited liability company and a direct wholly owned subsidiary of the Company ("Second Merger Sub"), and Jet Token, Inc., a Delaware corporation ("Jet Token"). Pursuant to the terms of the Business Combination Agreement, a business combination between the Company and Jet Token was effected through the merger of First Merger Sub and Jet Token, with Jet Token emerging as the surviving company, followed by a merger between Jet Token and Second Merger Sub, with Second Merger Sub emerging as the surviving company as a wholly owned subsidiary of the Company. In connection with the Business Combination, the Company was domesticated and continues as a Delaware corporation and immediately changed its name to "Jet.AI Inc."

Following the closing of the Business Combination, the Company's common stock, par value $0.0001 per share, was listed on the Nasdaq Stock Market LLC under the ticker symbol "JTAI" and Jet Token was determined to be the accounting acquirer in the Business Combination. Accordingly, for accounting purposes, the Business Combination was treated as the equivalent of Jet Token issuing stock for the net assets of the Company, accompanied by a recapitalization. The Company is now a holding company for several wholly owned subsidiaries, including Second Merger Sub.

To date, the Company, directly and indirectly through its subsidiaries, has principally been involved in (i) the sale of fractional and whole interests in aircraft, (ii) the sale of jet cards, which enable holders to use certain aircraft at agreed-upon rates, (iii) the operation of a proprietary booking platform (the "App"), 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 Elite aircraft by Cirrus Aviation Services ("Cirrus"), (v) aircraft brokerage and (vi) service revenue from the monthly management and hourly operation of customer aircraft. In 2025 the Company began transitioning its primary focus to AI data center operations and assets.

**NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**

*Going Concern and Management Plans*

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

During the next twelve months, the Company intends to fund its operations and obligations with capital from its operations, and proceeds from sales of debt or equity securities. The Company could, if necessary, 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*

 

The Business Combination was accounted for as a reverse recapitalization in accordance with GAAP, whereby the Company 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 the Company, accompanied by a recapitalization. The net assets of the Company were stated at historical cost, with no goodwill or other intangible assets recorded.

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

● Jet Token's former stockholders had the greatest voting interest in the combined entity;

● Jet Token's former stockholders had the ability to nominate a majority of the initial members of the combined entity board of directors;

● Jet Token's senior management is the senior management of the combined entity;

● Jet Token is the larger entity based on historical operating activity and has the larger employee base; and

● The post-combination company has assumed a Jet Token branded name: "Jet.AI Inc."

*Unaudited Interim Financial Statements*

 

Certain information and disclosures normally included in the annual consolidated financial statements prepared in accordance with GAAP have been condensed or omitted. In the opinion of management, all adjustments and disclosures necessary for a fair presentation of these unaudited consolidated interim financial statements have been included. Such adjustments consist of normal recurring adjustments. The results of operations for the nine months ended September 30, 2025 are not necessarily indicative of the results that may be expected for the full year.

 

*Reverse Stock Split*

 

On November 12, 2024, the Company effected a reverse common stock split of the Company's issued and outstanding shares of common stock at a ratio of 1-for-225. In addition, the aggregate number of equity-based awards that remain available to be granted under the Company's equity compensation plans was decreased proportionately and proportionate adjustments were made to the per-share exercise price and the number of shares issuable upon the exercise of outstanding stock options, as applicable, as well as to the number of shares that would be owned upon vesting and settlement of restricted stock units and other equity-based awards, as applicable. Similar proportionate adjustments were also made to the outstanding warrants. No fractional shares were issued as a result of the reverse stock split and any fractional shares resulting from the reverse stock split were rounded down to the nearest number of whole shares so that the Company issued cash in lieu of any fractional shares that such stockholder would have received as a result of the reverse stock split. In accordance with Accounting Standards Codification ("ASC") 260-10-55-12, the Company has adjusted the number of shares, per-share computations and the computations of basic and diluted loss per share ("EPS") retroactively for all periods presented in the consolidated financial statements and related notes.

*Principles of Consolidation*

The accompanying consolidated financial statements include the accounts of Jet.AI Inc. and its wholly owned subsidiaries, Summerlin Aviation LLC, Jet Token Software Inc., Jet Token Management Inc., Galilee LLC, and Galilee 1 SPV LLC. All intercompany accounts and transactions have been eliminated in consolidation.

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.

*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 statements 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 consolidated 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.

*Fair Value of Financial Instruments*

Fair value is defined by ASC 820 as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants as of the measurement date. Applicable accounting guidance provides an established hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in valuing the asset or liability and are developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company's assumptions about the factors that market participants would use in valuing the asset or liability. There are three levels of inputs that may be used to measure fair value:

Level 1 - Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.

Level 2 - Include other inputs that are directly or indirectly observable in the marketplace.

Level 3 - Unobservable inputs which are supported by little or no market activity.

The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

*Risks and Uncertainties*

The Company has limited operating history and has incurred losses from operations since inception. The Company's business and operations are sensitive to general business and economic conditions in the United States and worldwide along with local, state, and federal governmental policy decisions. A host of factors beyond the Company's control could cause fluctuations in these conditions. Adverse conditions may include but are not limited to: changes in the private 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, competition and other barriers to entry in the data center industry and market acceptance of the Company's business model. These adverse conditions could affect the Company's financial condition and the consolidated results of its operations.

*Cash and Cash Equivalents*

For purpose of the consolidated statement of cash flows, the Company considers all highly liquid debt instruments purchased with an original maturity of three months or less to be cash equivalents. Included within cash and cash equivalents is restricted cash of $500,000 at September 30, 2025 and December 31, 2024.

*Offering Costs*

The Company complies with the requirements of ASC 340-10-S99-1 with regards to offering costs. Prior to the completion of an offering, offering costs will be capitalized as deferred offering costs on the consolidated balance sheet. The deferred offering costs will be charged to stockholders' equity upon the completion of an offering or to expenses if the offering is not completed.

*Other Current Assets*

Other current assets include security deposits, which relate primarily to contractual prepayments to third parties for future services, prepaid expenses and customer receivables for additional expenses incurred in their charter trips.

*Property and Equipment*

Property and equipment are recorded at cost, less accumulated depreciation. Expenditures for major additions and improvements are capitalized and minor replacements, maintenance, and repairs are charged to expense as incurred. When property and equipment are retired or otherwise disposed of, the cost and accumulated depreciation are removed from the accounts and any resulting gain or loss is included in the results of operations for the respective period. Depreciation is provided over the estimated useful lives of the related assets using the straight-line method for financial statement purposes. As of September 30, 2025 and December 31, 2024, property and equipment consisted entirely of equipment which is being depreciated over a three-year period.

*Internal-Use Software*

The Company incurs software development costs to develop software programs to be used solely to meet its internal needs and cloud-based applications used to deliver its services. In accordance with ASC 350-40, Internal-Use Software, the Company capitalizes development costs related to these software applications once a preliminary project stage is complete, funding has been committed, and it is probable that the project will be completed, and the software will be used to perform the function intended. As of September 30, 2025 and December 31, 2024, the Company has capitalized approximately $398,000 of internal software related costs, which is included in intangible assets in the accompanying consolidated balance sheets and was fully amortized as of September 30, 2025 and December 31, 2024.

*Investments in Joint Ventures*

In January 2023, the Company formed a 50/50 joint venture subsidiary with Great Western Air LLC (dba Cirrus Aviation Services) called 380 Software LLC, a Nevada limited liability company. Costs and profits are to be shared equally between the Company and Cirrus. The Company accounts for these investments using the equity method whereby the initial investment is recorded at cost and subsequently adjusted by the Company's share of income or loss from the joint venture. There is currently no financial activity or material assets to report for this joint venture beyond this initial investment.

*Allowance for Credit Losses*

 

The Company recognizes an expected allowance for credit losses with respect to its accounts receivable. In addition, also at each reporting date, this estimate is updated to reflect any changes in credit risk since the receivable was initially recorded. Accounts receivable are evaluated individually for impairment. This estimate is adjusted for management's assessment of current conditions, reasonable and supportable forecasts regarding future events, and any other factors deemed relevant by the Company. The Company believes historical loss information is a reasonable starting point in which to calculate the expected allowance for credit losses. The Company writes off receivables when there is information that indicates the debtor is facing significant financial difficulty and there is no possibility of recovery. If any recoveries are made from any accounts previously written off, they will be recognized in operations or an offset to credit loss expense in the year of recovery, in accordance with the entity's accounting policy election. No allowance for credit losses was considered necessary at September 30, 2025 and December 31, 2024*.*

 

*Leases*

The Company determines if an arrangement is a lease at inception on an individual contract basis. Operating leases are included in operating lease right-of-use assets, current operating lease liabilities, and non-current operating lease liabilities on the consolidated balance sheets. Operating lease right-of-use assets represent the right to use an underlying asset for the lease term. Operating lease right-of-use assets are recognized at lease commencement date based on the present value of the future minimum lease payments over the lease term. The interest rate implicit in each lease was readily determinable to discount lease payments.

The operating lease right-of-use assets include any lease payments made, including any variable amounts that are based on an index or rate, and exclude lease incentives. Lease terms may include options to extend or terminate the lease. Renewal option periods are included within the lease term and the associated payments are recognized in the measurement of the operating right-of-use asset when they are at the Company's discretion and considered reasonably certain of being exercised. Lease expense for lease payments is recognized on a straight-line basis over the lease term.

The Company has elected the practical expedient not to recognize leases with an initial term of 12 months or less on the Company's consolidated balance sheets and lease expense is recognized on a straight-line basis over the term of the short-term lease.

*Impairment of Long-Lived Assets*

The Company follows ASC 360-10, Impairment or Disposal of Long-Lived Assets. ASC 360-10 requires that if events or changes in circumstances indicate that the carrying value of long-lived assets or asset groups may be impaired, an evaluation of recoverability would be performed by comparing the estimated future undiscounted cash flows associated with the asset to the asset's carrying value to determine if a write-down to market value would be required. Long-lived assets or asset groups that meet the criteria in ASC 360-10 as being held for sale are reflected at the lower of their carrying amount or fair market value, less costs to sell.

*Revenue Recognition*

In applying the guidance of ASC 606, Revenue from Contracts with Customers, the Company determines revenue recognition through the following steps:

● Identification of the contract, or contracts, with a customer;

● Identification of the performance obligations in the contract;

● Determination of the transaction price;

● Allocation of the transaction price to the performance obligations in the contract; and

● Recognition of revenue when, or as, a performance obligation is satisfied.

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 Company's App 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. 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. As of September 30, 2025 and December 31, 2024, the Company deferred $340,601 and $1,091,235, respectively, related to prepaid flight hours under the jet card program for which the related travel had not yet occurred.

The Company also generates revenues from individual ad hoc charter bookings processed through the Company's App, whereby the Company sources, negotiates, and arranges 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 Aviation Services markets charters on the Company's aircraft for the Company's benefit. Deferred revenue with respect to the App was $86,181 and $212,278 as of September 30, 2025 and December 31, 2024, respectively.

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. Deferred revenue with respect to the management of aircraft was $16,233 as of September 30, 2025 and December 31, 2024.

The following is a breakout of revenue components by subcategory for the three and nine months ended September 30, 2025 and 2024.

SCHEDULE OF BREAKOUT OF REVENUE COMPONENTS BY SUBCATEGORY

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended** | **Three Months Ended** | **Nine Months Ended** | **Nine Months Ended** |
|  | **September 30,** | **September 30,** | **September 30,** | **September 30,** |
|  | **2025** | **2024** | **2025** | **2024** |
| Software App and Cirrus Charter | $642279 | $2409742 | $3763924 | $6391732 |
| Jet Card and Fractional Programs | 184655 | 547186 | 949306 | 1783066 |
| Management and Other Services | 884054 | 960465 | 2698296 | 2675077 |
|  | $1710988 | $3917393 | $7411526 | $10849875 |

---

*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 from time to time 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. The Company recorded no aircraft sales for the nine months ended September 30, 2025 and 2024.

*Pass-Through Costs*

In applying the guidance of ASC 606, the Company recognizes revenue when a 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, each of which is discussed below.

&nbsp;&nbsp;&nbsp;&nbsp;1. <u>Chartering Third-Party Aircraft:</u> The cost of chartering third-party aircraft is recorded as a part of the cost of sales expense. These expenses
 include the fees paid to third-party operators for providing aircraft services on behalf of the Company. Expenses are recognized
 in the statements of operations in the period when the service is rendered and are reported on an accrual basis.

2. <u>Aircraft Lease Expenses:</u> Aircraft lease expenses include the cost of leasing aircraft for the Company's operations. The lease expenses
 are recognized as an operating expense in the statements of operations over the lease term on a straight-line basis.

3. <u>Pilot Training and Wages:</u> Pilot training costs are expensed as incurred and are included in the cost of sales expenses. This encompasses
 expenses related to initial pilot training, recurrent training, and any additional required training programs. Pilot wages, including
 salaries, bonuses, and benefits, are also recognized as a part of the cost of sales expenses and are reported on an accrual basis.

4. <u>Aircraft Fuel:</u> The cost of aircraft fuel is recognized as an expense in the cost of sales category based on the actual consumption during
 flight operations. Fuel costs are recorded in the statements of operations in the period when the fuel is consumed and are reported
 on an accrual basis.

5. <u>Aircraft Maintenance:</u> Aircraft maintenance expenses include both routine and non-routine maintenance. Routine maintenance costs are expensed
 as incurred and are recorded as a part of the cost of sales expense. Non-routine maintenance expenses, such as major repairs and
 overhauls, are capitalized and amortized over their expected useful life. The amortization expense is included in the cost of sales
 expense and is recognized in the statements of operations on a straight-line basis over the asset's useful life.

6. <u>Other Aircraft Operating Expenses:</u> Other aircraft operating expenses include costs such as insurance, landing fees, navigation charges,
 and catering services. These expenses are recognized in the statements of operations as part of the cost of sales expenses in the
 period when they are incurred and are reported on an accrual basis.

*Advertising Costs*

The Company expenses the cost of advertising and promoting the Company's services as incurred. Such amounts are included in sales and marketing expense in the consolidated statements of operations and totaled $676,081 and $632,380 for the nine months ended September 30, 2025 and 2024, respectively.

*Research and Development* 

The Company incurs research and development costs during the process of researching and developing its technologies and future offerings. The Company's research and development costs consist primarily of payments for third-party software development that is not capitalizable. The Company expenses these costs as incurred until the resulting product has been completed, tested, and made ready for commercial use.

*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.

*Income Taxes*

The Company applies ASC 740, Income Taxes. Deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial statement reported amounts at each period end, based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. The provision for income taxes represents the tax expense for the period, if any and the change during the period in deferred tax assets and liabilities.

ASC 740 also provides criteria for the recognition, measurement, presentation and disclosure of uncertain tax positions. A tax benefit from an uncertain position is recognized only if it is "more likely than not" that the position is sustainable upon examination by the relevant taxing authority based on its technical merit.

The Company is subject to tax in the United States and files tax returns in the U.S. Federal jurisdiction and Nevada state jurisdiction. The Company is subject to U.S. Federal, state, and local income tax examinations by tax authorities for all periods since inception. The Company currently is not under examination by any tax authority.

 

*Loss per Common Share*

 

The Company presents basic EPS and diluted EPS on the face of the consolidated statements of operations. Basic EPS is computed as net loss divided by the weighted average number of common shares outstanding for the period. For periods in which the Company incurs a net loss, the effects of potentially dilutive securities would be antidilutive and would be excluded from the diluted EPS calculations. For the nine months ended September 30, 2025 and 2024, there were (i) 22,668 and 21,336 options, (ii) 9,686 warrants to purchase common stock, and (iii) 2,802,113 and 8,032 common shares issuable upon conversion of Series B Convertible Preferred Stock, respectively, excluded.

*Concentration of Credit Risk*

The Company maintains its cash with several major U.S. financial institutions which it believes to be creditworthy. Balances are insured by the Federal Deposit Insurance Corporation up to $250,000. At times, however, the Company may maintain balances in excess of the federally insured limits.

*Segment Reporting*

The Company identifies operating segments as components of the Company for which discrete financial information is available and is regularly reviewed by the chief operating decision maker, or decision-making group, in making decisions regarding resource allocation and performance assessment. The chief operating decision maker is the Interim Chief Executive Officer. The Company determined that as of and through September 30, 2025 the Company operates in a single operating and reportable segment, private aviation services, as the chief operating decision maker reviews financial information presented on a consolidated basis, accompanied by disaggregated information about revenue, for purposes of making operating decisions, allocating resources, and assessing performance. All of the Company's long-lived assets are located in the U.S. and revenue from private aviation services is substantially earned from flights throughout the U.S.

*Recent Accounting Pronouncements*

 

In November 2024, the Financial Accounting Standards Board issued Accounting Standards Update 2024-03, "Expense Disaggregation Disclosures." ASU 2024-03 requires disclosure to disaggregate prescribed expenses within relevant statement of operations captions. The standard is effective for fiscal years beginning after December 15, 2026 and for interim periods after December 15, 2027. Early adoption is permitted. The Company is evaluating the impact of the changes to its existing disclosures.

In July 2025, the FASB issued ASU No. 2025-05, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets. The ASU provides an optional practical expedient for estimating future credit losses based on current conditions as of the balance sheet date and assuming those conditions do not change over the remaining life of the accounts receivable. This standard is effective January 1, 2026. The Company does not expect this ASU to have a material impact on the condensed consolidated results of operations and financial condition.

In September 2025, the FASB issued ASU No. 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. The ASU removes references to prescriptive software development stages and includes an updated framework for capitalizing internal software costs. This standard is effective January 1, 2028. The Company is currently evaluating this ASU's impact on the condensed consolidated results of operations and financial condition.

**NOTE 3 – OTHER ASSETS**

Other assets consisted of the following:

---

| | | |
|:---|:---|:---|
|  | **September 30,**<br>**2025** | **December 31,**<br>**2024** |
| Deposits | $145811 | $104811 |
| Lease Maintenance Reserve | 689750 | 689750 |
| Total Other Assets | $835561 | $794561 |

---

**NOTE 4 – NOTES RECEIVABLE**

*Unsecured Promissory Note* 

 

On May 31, 2025, the Company entered into a promissory note with an affiliated entity (the "Maker"). Under the terms of the note, the Company may advance up to $300,000 to the Maker to fund its organizational costs and expenses. The note is unsecured, non-interest-bearing, and is repayable on the earlier of (i) November 30, 2025 or (ii) the consummation of an initial public offering by the Maker, and may be prepaid at any time without penalty. As of September 30, 2025, the Company had advanced $236,790 under this note.

During, 2025, the Maker repaid in full all obligations owed to the Company under the promissory note.

**NOTE 5 – NOTES PAYABLE**

*Bridge Agreement*

On September 11, 2023, the Company entered into a binding term sheet (the "Bridge Agreement") with eight investors whereby the investors purchased senior secured promissory notes (the "Bridge Notes") from the Company in the aggregate principal amount of $625,000, which included $281,250 from related parties.

The Company received net proceeds from the sale of the Bridge Notes of $500,000, resulting in an original issue discount of $112,500. The notes accrued interest at five percent (5%) per annum and matured on March 11, 2024. The Company recognized a debt discount of $168,250 from the Bridge Notes, of which $90,625 was amortized during the nine months ended September 30, 2024. Interest expense was $79,314 for the nine months ended September 30, 2024.

These notes and accrued interest payable were fully repaid during the nine months ended September 30, 2024.

**NOTE 6 – COMMITMENTS AND CONTINGENCIES**

*Operating Lease*

In November 2021, the Company entered into a leasing arrangement with a third party for an aircraft to be used in the Company's operations. The lease term is for 60 months, expiring November 2026, and requires monthly lease payments. At any time during the lease term, the Company has the option to purchase the aircraft from the lessor at the aircraft's fair market value at that time.

The lease agreement also requires the Company to hold a liquidity reserve of $500,000 in a separate bank account as well as a maintenance reserve of approximately $690,000 for the duration of the lease term. The liquidity reserve is held in a bank account owned by the Company. As such, this is classified as restricted cash in the accompanying consolidated balance sheets. The maintenance reserve are funds held by the lessor to be used for reasonable maintenance expenses in excess of those covered by the airframe and engine maintenance programs maintained by the Company. These maintenance programs are designed to fully cover the Company's aircraft's maintenance costs, both scheduled and unscheduled, and therefore the Company does not expect these funds will be drawn upon. If funds from the maintenance reserve are expended by the lessor, the Company is required to replenish the maintenance reserve account up to the required reserve amount. Any funds remaining at the end of the Lease term will be returned to the Company. The maintenance reserve is included within deposits and other assets in the accompanying consolidated balance sheets.

Total lease expense for the nine months ended September 30, 2025 and 2024 was $969,188 and $1,022,325, respectively, which is included within cost of revenues in the accompanying statements of operations.

Right-of-use lease assets and lease liabilities for our operating leases was recorded in the consolidated balance sheet as follows:

---

| | | |
|:---|:---|:---|
|  | **September 30,**<br>**2025** | **December 31,**<br>**2024** |
| Operating lease right-of-use asset | $2576036 | $2576036 |
| Accumulated amortization | (1930937) | (1527682) |
| Net balance | $645099 | $1048354 |
| Lease liability, current portion | $537491 | $525547 |
| Lease liability, long-term | 91158 | 495782 |
| Total operating lease liabilities | $628649 | $1021329 |

---

As of September 30, 2025, the weighted average remaining lease term was 1.1 years, and the weighted average discount rate was 3%.

As of September 30, 2025, future minimum required lease payments due under the non-cancellable operating lease are as follows:

---

| | |
|:---|:---|
| 2025 (three months) | 137250 |
| 2026 | 503250 |
| Total future minimum lease payments | 640500 |
| Less imputed interest | (11851) |
| Maturities of lease liabilities | $628649 |

---

*<u>GEM Share Purchase Agreement</u>*

Jet Token executed a 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"), which was automatically assumed by the Company when the Business Combination was effected. 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 during the 36-month period following the date of listing on Nasdaq.

No shares of common stock were sold pursuant to this agreement during the nine months ended September 30, 2025.

During the nine months ended September 30, 2024, the Company issued 14,222 shares of common stock pursuant to the agreement for total consideration of $1.7 million.

Pursuant to the Share Purchase Agreement, the Company issued to GEM a warrant (the "GEM Warrant") granting it the right to purchase up to 9,686 shares of common stock of the Company. The GEM Warrant was issued with an exercise price of $1,935 and a term of three years. The GEM Warrant included an adjustment mechanism, whereby the exercise price is subject to adjustment from time to time. Pursuant to the GEM Warrant, on the first anniversary following the Public Listing Date as defined in the GEM Warrant (the "Adjustment Date"), if all or any portion of the GEM Warrant remained unexercised and the average closing price of the Company's common stock for the 10 trading days following the Adjustment Date was less than 90% of the then-current exercise price of the warrant (the "Baseline Price"), then the exercise price of the unexercised Warrant Shares that remained exercisable pursuant to the GEM Warrant would be adjusted to 110% of the Baseline Price. Accordingly, the GEM Warrant exercise price was reduced to $9.07 per share as of September 30, 2025.

On August 4, 2022, the Company entered into a Registration Rights Agreement with GEM, obligating the Company to file a registration statement with respect to resales of the shares of common stock issuable to GEM under the Share Purchase Agreement and upon exercise of the GEM Warrant. Because that registration statement was not declared effective by October 23, 2023 (the "Effectiveness Deadline"), the Company was obligated to pay GEM an amount equal to $10,000 for each day following the Effectiveness Deadline until the registration statement was declared effective subject to a $300,000 cap if such delay in the declaration of effectiveness of the registration statement was caused by delays in SEC review of the registration statement or the SEC's refusal to declare the registration statement effective. The Company has accrued $300,000 as of September 30, 2025 and December 31, 2024 with respect to this agreement.

On October 23, 2023, the Company entered into a warrant amendment agreement retroactively effective as of August 10, 2023 (the "GEM Warrant Amendment"). The GEM Warrant Amendment provides that GEM can elect to limit the exercisability of the GEM Warrant to purchase shares of the Company's common stock, 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 the Company's common stock outstanding immediately after giving effect to such exercise. On October 23, 2023, GEM provided a notice to the Company electing to have this limit apply to the GEM Warrant effective as of August 10, 2023. GEM may revoke this election notice by providing written notice to the Company of such revocation, which revocation would not be effective until 61 days after such notice is delivered to the Company.

*<u>Textron Aircraft Purchase Agreement</u>*

 

On October 31, 2024, the Company entered into an aircraft purchase agreement with Textron Aviation Inc. ("Textron"), for the purchase of three Cessna Citation CJ4 aircraft (the "CJ4 Aircraft"). Under the aircraft purchase agreement, the Company may purchase from Textron specifically configured CJ4 Aircraft at prevailing market rates whereby the aggregate purchase price could be approximately $40.5 million. The aircraft are expected to be delivered in the third and fourth quarter of 2026. The Company made deposits totaling approximately $4.1 million under the purchase agreement through September 30, 2025. No additional deposits are required under this agreement.

*<u>December 2024 Engagement Letter</u>*

 

On December 4, 2024, the Company entered into an engagement letter (the "2024 Maxim Engagement Letter") with Maxim Group LLC ("Maxim"), pursuant to which the Company engaged Maxim to serve as its exclusive financial advisor with respect to one or more potential business combinations involving the Company for a period of seven months. Pursuant to the 2024 Maxim Engagement Letter, the Company agreed to pay Maxim a non-refundable stock fee of 25,000 shares (the "Retainer") which were issued upon execution of the engagement letter.

If the Company consummates certain transactions, then Maxim is due a fee (the "Success Fee") of $500,000 upon the closing of the transaction. In the event that the Company enters into an agreement with respect to a transaction during the term of the 2024 Maxim Engagement Letter that is subsequently terminated, and the Company becomes entitled to a break-up, termination, topping, expense reimbursement or similar fee or payment (including any judgment for damages or amount in settlement of any dispute as a result of such termination, or any profit on any stock acquired from, or stock option granted by, any party to such transaction), a fee (the "Break-up Fee") equal to 25% of all such amounts will be payable to Maxim promptly upon receipt of such amounts by the Company. In addition to the Retainer, Success Fee and Break-up Fee payable pursuant to the 2024 Maxim Engagement Letter, and regardless of whether any transaction is proposed or consummated, the Company will reimburse Maxim for certain out of pocket expenses incurred under the 2024 Maxim Engagement Letter.

*<u>February 2025 Engagement Letter</u>*

On February 25, 2025, the Company entered into an engagement letter (the "2025 Maxim Engagement Letter") with Maxim, pursuant to which the Company engaged Maxim to serve as its exclusive financial advisor with respect to a spin-out transaction. Pursuant to the 2025 Maxim Engagement Letter, the Company agreed to pay Maxim a non-refundable stock fee of 25,000 shares of common stock which were issued upon execution of the 2025 Maxim Engagement Letter. If the Company consummates a spin-out transaction, then Maxim will receive a success fee of $500,000 upon closing. The Company also agreed to reimburse Maxim for certain expenses pursuant to the 2025 Maxim Engagement Letter.

On May 16, 2025, the Company entered into an amendment to the 2025 Maxim Engagement Letter. Pursuant to the amendment, in the event the Company executes, on a one-time basis, both a Joint Venture Agreement and a related Contribution Agreement with any counterparty in connection with a spin-out, joint venture, or similar transaction, the Company shall issue to Maxim an additional 125,000 shares of common stock. The amendment further provides that no additional shares shall be issued to Maxim in connection with any subsequent or additional transactions of a similar nature.

During the nine months ended September 30, 2025, the Company issued 150,000 shares of common stock pursuant to the 2025 Maxim Engagement Letter. The shares were recorded to General and Administrative expenses as stock-based compensation based on the fair value of the shares of approximately $625,000.

*<u>Joint Venture Agreement</u>*

On June 26, 2025, the Company entered into a Joint Venture Agreement (the "JV Agreement") with Consensus Core Technologies Inc., a British Columbia corporation ("Consensus Core"), pursuant to which the parties agreed to collaborate in developing data centers. The JV Agreement provided certain terms of the joint venture, including: (i) the parties would enter into a Contribution Agreement (the "Contribution Agreement") with a joint venture limited liability company (a "JVLLC") outlining the full terms of the joint venture; (ii) the JVLLC would be organized under the laws of the State of Delaware prior to any initial closing under the Contribution Agreement, which would initially be wholly owned by Consensus Core; and (iii) the JVLLC would establish separate subsidiaries for each data center project to be contributed to the joint venture.

*<u>Contribution Agreement</u>*

On July 2, 2025, the Company entered into a Contribution Agreement with Consensus Core and Convergence Compute LLC, a Delaware limited liability company ("Convergence Compute"), pursuant to which the Company contributed $300,000 to Convergence Compute in the first closing of the transactions contemplated by the JV Agreement. As consideration for its initial contribution, the Company acquired a 0.5% equity interest in Convergence Compute. Upon the completion of certain data center project milestones, each of the Company and Consensus Core will make additional contributions to Convergence Compute and will receive additional equity interests in Convergence Compute and its subsidiaries.

Pursuant to the Contribution Agreement, the Company will contribute up to an aggregate $20 million to Convergence Compute in five tranches, with the obligation to deliver each tranche tied to specific project development milestones identified in the Contribution Agreement. Consensus Core will contribute 100% of the equity interests of the Midwest data center project to Convergence Compute at the second closing under the Contribution Agreement and will contribute 100% of the equity interests of the Maritime data center project to Convergence Compute at the third closing under the Contribution Agreement. In consideration for such contributions, the Company and Consensus Core will each receive a 17.5% equity interest in the Midwest project upon the second closing and a 17.5% equity interest in the Maritime project upon the third closing. The Company will also receive an additional 0.5% equity interest in Convergence Compute upon each additional closing, for an aggregate equity interest of up to 2.5% if all five tranches are consummated.

**NOTE 7 – STOCKHOLDERS' EQUITY**

*Common Stock and Preferred Stock*

Under the Amended and Restated Certificate of Incorporation of the Company, as amended, the Company is authorized to issue up to 204,000,000 shares, consisting of two classes: 200,000,000 shares of common stock, $0.0001 par value per share, and 4,000,000 shares of preferred stock, $0.0001 par value per share, of which 5,000 shares of preferred stock have been designated as Series B Convertible Preferred Stock, par value $0.0001 ("Series B Preferred Stock"). As of September 30, 2025, there were no issued and outstanding shares of Series A Preferred Stock and Series A-1 Preferred Stock, and 989 issued and outstanding shares of Series B Preferred Stock.

 

*Warrant Exchange*

 

On July 30, 2024, the Company completed an exchange offer relating to its previously outstanding Redeemable Warrants, Merger Consideration Warrants, and private placement warrants (the "Private Placement Warrants"), whereby the holders of the Redeemable Warrants and Private Placement Warrants were offered 0.3054 shares of common stock, and holders of Merger Consideration Warrants were offered 1.0133 shares of common stock, in exchange for each outstanding warrant tendered (the "Warrant Exchange Offer"). In connection with the closing of the Warrant Exchange Offer, a total of 42,597 shares of common stock were issued in exchange for 87,644 warrants. Pursuant to an amendment to the warrant agreement with respect to each class of warrants approved by the holders in connection with the Warrant Exchange Offer, on September 9, 2024, the 14,764 outstanding warrants that were not tendered in the exchange were exchanged for 10,939 shares of common stock. There were no Redeemable Warrants, Merger Consideration Warrants, or Private Placement Warrants outstanding as of September 30, 2024.

 

As a result of these transactions, the Company recognized a deemed dividend of $540,255 from the excess of the fair value of the common stock over the fair value of the warrants immediately prior to the exchange.

*flyExclusive Transaction*

On February 13, 2025, the Company entered into an Agreement and Plan of Merger and Reorganization (the "Merger Agreement") with flyExclusive, Inc. ("flyExclusive"), FlyX Merger Sub, Inc., a Delaware corporation and wholly owned subsidiary of flyExclusive ("Merger Sub"), and Jet.AI SpinCo, Inc., a Delaware corporation and wholly owned subsidiary of the Company ("SpinCo"). Pursuant to the Merger Agreement, (i) as a condition to closing on the Merger Agreement, the Company will distribute all of the shares of SpinCo, on a pro rata basis, to the Company's stockholders and (ii) Merger Sub will merge with and into SpinCo (the "Merger" and, together with the Distribution and all other transactions contemplated under the Merger Agreement, the "Transactions") with SpinCo surviving the Merger as a wholly owned subsidiary of flyExclusive.

In connection with executing the Merger Agreement, the Company, SpinCo, and flyExclusive entered into a Separation and Distribution Agreement (the "Separation and Distribution Agreement") pursuant to which the Company will transfer the business, operations, services and activities of the Company's jet charter business to SpinCo. Upon the terms and subject to the conditions set forth in the Separation and Distribution Agreement, the Company will distribute all of the shares of common stock of SpinCo ("SpinCo Common Stock") to the Company's stockholders on a pro rata basis as set forth in the Separation and Distribution Agreement (the "Distribution"). As such, the Company will no longer operate a jet charter business as of consummation of the Distribution. There will be no change to the Company's board of directors or executive officers as a result of the Transactions.

Upon closing of the Merger, the holders of SpinCo Common Stock will have their SpinCo Common Stock converted on a pro rata basis into the right to receive shares of Class A common stock of flyExclusive ("flyExclusive Common Stock"), based on an exchange ratio equal to the quotient of (i) the "Initial Purchase Price" divided by the volume weighted average closing sale price of the flyExclusive Common Stock as reported on NYSE American for a period of 30 consecutive trading days ending on the trading day three trading days prior to the day of closing of the Merger (the "Merger Consideration Shares"), divided by (ii) the total outstanding shares of SpinCo Common Stock. The "Initial Purchase Price" is an amount equal to the product of (x) SpinCo's estimated net cash, multiplied by certain premium percentages depending on SpinCo's estimated net cash upon closing of the Merger. The number of Merger Consideration Shares that holders of SpinCo Common Stock will receive is subject to adjustment, depending on, among other things, the actual amount of SpinCo's net cash at closing of the Merger. The Company's stockholders will continue to own and hold their existing shares of the Company's common stock as of closing of the Merger.

On May 6, 2025, the parties entered into an Amended and Restated Agreement and Plan of Merger and Reorganization (the "Amended Merger Agreement"), which amends, restates, replaces, and supersedes the original Merger Agreement. Under the Amended Merger Agreement, 80% of the Merger Consideration Shares will be issued upon the closing, and 20% of the Merger Consideration Shares will be held in reserve by flyExclusive until a final post-closing purchase price is determined. Once the final post-closing purchase price is determined, flyExclusive will only issue additional Merger Consideration Shares from the reserve on a dollar for dollar basis up to the lesser of the final purchase price and the initial purchase price.

The Amended Merger Agreement requires the Company to execute a new securities purchase agreement with a third-party investor, pursuant to which the Company will issue the investor a warrant to purchase up to $50 million worth of shares of a newly designated series of preferred stock.

On October 10, 2025, the parties further entered into an amendment to the Amended Merger Agreement, to extend the deadline for the closing of the proposed merger transaction from October 31, 2025 to December 31, 2025. All other terms of the Amended Merger Agreement remain in full force and effect.

The Transactions are subject to shareholder approval and are expected to close during the first quarter of 2026.

 

*Series B Convertible Preferred Stock Securities Purchase Agreement* 

On March 28, 2024, the Company entered into a Securities Purchase Agreement (the "Series B Securities Purchase Agreement") with Ionic Ventures, LLC ("Ionic") for a private placement, which closed on March 29, 2024. Pursuant to the Series B Securities Purchase Agreement the Company sold 150 shares of Series B Preferred Stock, a warrant to purchase up to 1,500 shares of Series B Preferred Stock with an exercise price of $10,000 per share, and 1,111 shares of Jet.AI common stock for net proceeds of $1,345,025 after deducting offering costs of $155,000.

Each share of Series B Preferred Stock is convertible into a number of shares of Jet.AI 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 Ionic.

Subject to the limitations set forth in the preceding paragraph and provided there is an effective registration statement covering Ionic's resale of the Jet.AI common stock underlying the Series B Preferred Stock, shares of Series B Preferred Stock will automatically convert into shares of Jet.AI 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 of the Series B Convertible Preferred Stock. The conversion price is equal to 90% (or, in the case of a delisting, 80%) of the lowest daily volume weighted average price of Common Stock over a period beginning on the trading day after the Company delivers shares of common stock upon such conversion to Ionic 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 entered into by the Company and Ionic on March 29, 2024, suspension of trading, or the Company's failure to convert the Series B Preferred Stock into common stock when a conversion right is exercised, then the Company may be required to redeem the Series B Preferred Stock for cash at 110% of the stated value.

In connection with the transactions under the Series B Securities Purchase Agreement, the Company entered into a placement agency agreement (the "Placement Agency Agreement") with Maxim. Pursuant to the terms of the Placement Agency Agreement, the Company agreed to pay Maxim a cash fee equal to 7% of the aggregate gross proceeds raised under the Series B Securities Purchase Agreement. From time to time as the Company has issued additional securities under the Series B Securities Purchase Agreement, the Company is obligated to pay Maxim cash fees of up to $1,050,000.

In January and February 2025, the Company issued 1,100 shares of Series B Preferred Stock from the exercise of 1,100 Series B Preferred Stock warrants for gross proceeds of $11,000,000 before deducting offering costs of $770,000. As a result of these exercises, there were no remaining Series B Preferred Stock warrants outstanding as of September 30, 2025.

During the nine months ended September 30, 2025, the Company issued 1,701,355 shares of common stock for the conversion of 361 shares of Series B Preferred Stock.

*Regulation A Offerings*

In June 2021, the Company undertook a Regulation A, Tier 2 offering for which it was selling up to shares of 4,012 non-voting common stock at $5,400 per share for a maximum of $21,880,000. During the year ended December 31, 2023, the Company issued an additional 293 shares of non-voting common stock under the Regulation A, Tier 2 campaign for aggregate gross proceeds of $1,598,630, with $6,724 of these proceeds pending release from escrow at September 30, 2025.

*Share Repurchase Program*

 

On November 13, 2024, the Company's Board of Directors authorized and approved a share repurchase program (the "Share Repurchase Program") pursuant to which the Company may repurchase up to $2 million of the Company's outstanding shares of common stock from time to time through December 31, 2025. The Company may buy back its common stock from time to time, in amounts, at prices, and at such times as the Company deems appropriate, subject to market conditions, pursuant to Rule 10b-18 of the Securities Exchange Act of 1934, and federal and state laws governing such transactions, through a variety of methods, which may include open market purchases, privately negotiated transactions, block trades, accelerated share repurchase transactions, purchases through 10b5-1 trading plans, or by any combination of such methods. The Share Repurchase Program does not oblige the Company to acquire any specific number of shares and may be modified, discontinued, or suspended at any time. As of September 30, 2025, no shares had been repurchased under the Share Repurchase Program.

 

*Stock Options*

In connection with the Business Combination, the Company adopted the 2023 Omnibus Incentive Plan (the "2023 Plan"). The 2023 Plan provides for the grant of equity awards to employees, outside directors, and consultants, including the direct award or sale of shares, stock options, and restricted stock units to purchase shares. The 2023 Plan is a continuation of the Jet.AI Inc. 2018 Stock Option and Grant Plan (the "2018 Plan") and the Jet Token Inc. 2021 Stock Plan (the "2021 Plan"), which were assumed from Jet Token and amended, restated and re-named into the form of the 2023 Plan effective as of the consummation of the Business Combination. In September 2024, the 2023 Plan was amended to increase the number of shares of common stock authorized under the 2023 Plan to 10,933 shares and to eliminate the automatic share replenishment provision. As of September 30, 2025, the total number of shares reserved for issuance under the 2023 Plan was 10,933 shares. The 2023 Plan is administered by the Company's Board of Directors and expires ten years after adoption, unless terminated by the Board.

On June 4, 2018, the Company's Board of Directors adopted the 2018 Plan. The 2018 Plan provides for the grant of equity awards to employees, non-employee directors and consultants, to purchase shares of common stock. As of September 30, 2025, the total number of shares reserved for issuance under the 2018 Plan was 10,301. The 2018 Plan is administered by the Board.

In August 2021, the Board adopted the 2021 Plan. The 2021 plan provides for the grant of equity awards to employees, outside directors, and consultants, including the direct award or sale of shares, stock options, and restricted stock units to purchase shares. Up to 688 shares of common stock may be issued pursuant to awards granted under the 2021 Plan. During the year ended December 31, 2022, the 2021 Plan was amended to increase the number of shares of common stock authorized under the 2021 Plan to 2,063. In the event that shares of common stock subject to outstanding options or other securities under the Company's 2018 Plan expire or become exercisable in accordance with their terms, such shares shall be automatically transferred to the 2021 Plan and added to the number of shares then available for issuance under the 2021 Plan. The 2021 Plan is administered by the Board and expires ten years after adoption, unless terminated by the Board.

During the nine months ended September 30, 2024, the Company granted a total of 5,068 stock options to purchase common stock and 486 restricted stock units to various employees, advisors and consultants. The options have a ten-year life and an exercise price of $24.35. Approximately 3,958 of the options were immediately vested on the grant date, while the remaining options vest in monthly tranches over a three-year period. The options had a grant date fair value of approximately $90,000, which will be recognized over the vesting period. The 486 restricted stock units were immediately vested on the grant date.

There were no stock options granted during the nine months ended September 30, 2025.

During the nine months ended September 30, 2025 and 2024, stock-based compensation expense of $1,489,654 and $3,714,404, respectively, was recognized for the vesting of these options, as well as for payments to certain vendors. As of September 30, 2025, there was approximately $328,000 in unrecognized stock-based compensation, which will be recognized through September 2027.

A summary of our stock option activity for the nine months ended September 30, 2025 and 2024, is as follows:

SCHEDULE OF STOCK OPTIONS ACTIVITY

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| | | | |
|:---|:---|:---|:---|
|  | Number of Shares | Weighted Average<br> Exercise Price | Weighted average Remaining Contractual Term |
| Outstanding at December 31, 2023 | 16268 | $1381.64 | 7.37 |
| Granted | 5068 | 24.00 | 10.00 |
| Exercised |  |  |  |
| Expired/Cancelled | - | - | - |
| Outstanding at September 30, 2024 | 21336 | $1059.16 | 7.42 |

---

---

| | | | |
|:---|:---|:---|:---|
|  | Number of Shares | Weighted Average <br> Exercise Price | Weighted average Remaining Contractual Term |
| Outstanding at December 31, 2024 | 22668 | $998.26 | 7.32 |
| Granted |  |  |  |
| Exercised |  |  |  |
| Expired/Cancelled | - | - | - |
| Outstanding at September 30, 2025 | 22668 | $998.26 | 6.57 |
| Exercisable at September 30, 2025 | 20490 | $1107.62 | 6.30 |

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*Warrants*

 

The number of outstanding warrants issued by the Company as of September 30, 2025 is as follows:

SCHEDULE OF OUTSTANDING WARRANTS

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| | | | |
|:---|:---|:---|:---|
| **Warrant** | **Expiration Date Date** | **Exercise Price** | **Number Outstanding** |
| GEM Common Stock Warrants | 8/11/2026 | $9.07 | 9686 |
| Total |  |  | 9686 |

---

 

**NOTE 8 – RELATED PARTY TRANSACTIONS**

*<u>Promissory Note</u>*

See Note 4 for a discussion of the related party promissory note receivable entered into with an affiliated entity in May 2025.

*<u>Refundable Capital Contribution</u>*

During the quarter ended September 30, 2025, the Company made capital contributions of $2,660,000 to AIIA Sponsor Ltd. ("Sponsor"), which serves as the sponsor of AI Infrastructure Acquisition, Corp. ("AIIA"), in exchange for ordinary shares and preference shares of Sponsor. AIIA a special purpose acquisition company that after completing its initial public offering intends to focus on opportunities with companies and/or strategic assets in high-impact private technology companies advancing artificial intelligence and machine learning capabilities, as well as those involved in building, operating, or enabling next-generation data center infrastructure. Sponsor was founded and organized by certain of the Company's executive officers and directors, who also serve as officers or directors of AIIA, with capital commitments from Sponsor's founders and the Company. The Company's contribution represented a 49.9% interest in the Sponsor and was refundable in full if the AIIA offering was not successfully completed by October 31, 2025.

The offering closed on October 6, 2025. Refer to further disclosure in Note 11.

**NOTE 9 – FAIR VALUE OF FINANCIAL INSTRUMENTS** 

The carrying amount of the Company's financial instruments, which consist of cash and cash equivalents, accounts receivable, notes receivable, accounts payable, and notes payable approximate fair value due to their short-term nature.

**NOTE 10 – DEFERRED REVENUE**

Changes in deferred revenue for the nine months ended September 30, 2025 were as follows:

---

| | |
|:---|:---|
| Deferred revenue as of December 31, 2024 | $1319746 |
| Amounts deferred during the period | 1815814 |
| Revenue recognized from amounts included in the deferred revenue beginning balance | (1303513) |
| Revenue from current year sales | (1389032) |
| Deferred revenue as of September 30, 2025 | $443015 |

---

**NOTE 11 – SUBSEQUENT EVENTS**

The Company has evaluated subsequent events that occurred after September 30, 2025 through November 12, 2025, the date of these consolidated financial statements were available to be issued, and noted no additional events requiring recognition for disclosure, except as identified below.

*<u>Promissory Note</u>*

During October, the Maker repaid in full all obligations owed to the Company evidenced by promissory note identified in Note 4.

*<u>Interest in Sponsor and AIIA Initial Public Offering</u>*

On October 6, 2025, AIIA announced the closing of an initial public offering of units ("Units"). In the initial public offering, AIIA sold an aggregate of 13,800,000 Units at a price of $10.00 per unit, resulting in total gross proceeds of $138,000,000. Each Unit consisted of one Class A ordinary share and one right, with each right entitling the holder thereof to receive one-fifth (1/5) of a Class A ordinary share of AIIA upon consummation of an initial business combination.

In connection with AIIA initial public offering, Sponsor purchased from AIIA, simultaneous with the closing of the initial public offering, an aggregate of 269,000 Units at a price of $10.00 per unit ($2,690,000 in the aggregate) in a private placement (the "Private Placement Units"). Each Private Placement Unit consisted of one Class A ordinary share and one right, with each right entitling the holder thereof to receive one-fifth (1/5) of a Class A ordinary share of AIIA upon consummation of an initial business combination.

At the close of the offering, Sponsor held 4,600,000 shares of the Class B ordinary shares of AIIA, representing 25% of the outstanding shares of AIIA (the "Class B Shares"). In addition, the Sponsor held 269,000 units comprising of 269,000 Class A ordinary shares and 269,000 rights.

In connection with the organization of Sponsor, Jet.AI owns approximately 49.9% of the ordinary shares and preferred shares, respectively, of the Sponsor (the "Sponsor Equity Interest"). The Company's executive officers will be AIIA's management team. The preferred shares of Sponsor are nonvoting shares and generally entitle the holders thereof to receive the net proceeds, if any, received by Sponsor from the sale, exchange, or disposition of the 269,000 rights or the shares issuable upon the exercise thereof, and the ordinary shares of Sponsor (which are voting shares in Sponsor) will generally be equivalent to the value of the 4,600,000 Class B Shares and 269,000Class A shares of AIIA held by Sponsor.

On October 6, 2025, in conjunction with the closing of AIIA offering, the Company held an aggregate of 2,426,901 ordinary shares and 131,501 preferred shares of Sponsor.

**ITEM 2. 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 the historical unaudited consolidated financial statements as of September 30, 2025 and December 31, 2024, and the three and nine months ended September 30, 2025 and 2024, and the related notes that are included elsewhere in this report.*

*Certain of the information contained in this discussion and analysis or set forth elsewhere in this report, 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 "Item 1A – Risk Factors" in Jet.AI's Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed with the SEC on March 26, 2025, and factors identified in other subsequent reports filed with the SEC, 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 report. We assume no obligation to update any of these forward-looking statements.*

*Percentage amounts included in this report have not in all cases been calculated on the basis of such rounded figures, but on the basis of such amounts prior to rounding. Certain other amounts that appear in this report may not sum due to rounding.*

 

**Overview**

Jet.AI Inc., a Delaware corporation ("Jet.AI", "Company", "we" or "us"), was founded in 2018 by Michael Winston, its Executive Chairman. The Company, directly and indirectly through its subsidiaries, historically 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 Elite aircraft by Cirrus Aviation Services, (v) aircraft brokerage and (vi) monthly management and hourly operation of customer aircraft.

Currently we offer the following SaaS software to aircraft owners and operators generally:

● <u>Reroute AI:</u> recycles aircraft waiting to embark to their next revenue flight into prospective new charter bookings to destinations within specific operational parameters.

● <u>DynoFlight:</u> enables aircraft operators to estimate aircraft emissions then purchase carbon removal credits via our DynoFlight application programming interface API.

In 2024 and 2025, we launched two AI-enhanced booking apps called CharterGPT and Ava, respectively.

In 2025 the Company began transitioning its primary focus to AI data center operations and assets.

**Business Combination**

On August 10, 2023, the Company, formerly known as Oxbridge Acquisition Corp., consummated a business combination pursuant to a Business Combination Agreement and Plan of Reorganization, as amended by Amendment No. 1 to the Business Combination Agreement, dated as of May 11, 2023 (the "Business Combination Agreement") among the Company, OXAC Merger Sub I, Inc., a direct, wholly owned subsidiary of the Company ("First Merger Sub"), Summerlin Aviation LLC, a direct, wholly owned subsidiary of the Company ("Second Merger Sub"), and Jet Token Inc., a Delaware corporation ("Jet Token"). Pursuant to the Business Combination Agreement, the Company redomiciled as a Delaware corporation and was immediately renamed "Jet.AI Inc.", and promptly thereafter, (i) First Merger Sub merged with and into Jet Token, with Jet Token surviving the merger as a wholly owned subsidiary of the Company, and (b) Jet Token merged with and into Second Merger Sub with Second Merger Sub surviving the merger as a wholly owned subsidiary of the Company (each merger and all other transactions contemplated by the Business Combination Agreement, the "Business Combination").

Following the Business Combination, the Company's common stock was listed on the Nasdaq Stock Market LLC under the ticker symbol "JTAI".

The Business Combination was accounted for as a reverse recapitalization in accordance with GAAP, whereby the Company 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 the Company, accompanied by a recapitalization. The net assets of the Company 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.

***Potential Sale of Aviation Business Assets***

On February 13, 2025, the Company, entered into an Agreement and Plan of Merger and Reorganization (the "Merger Agreement") with flyExclusive, Inc. ("flyExclusive"), FlyX Merger Sub, Inc., a Delaware corporation and wholly owned subsidiary of flyExclusive ("Merger Sub"), and Jet.AI SpinCo, Inc., a Delaware corporation and wholly owned subsidiary of the Company ("SpinCo"). Pursuant to the Merger Agreement, (i) as a condition to closing on the Merger Agreement, the Company will distribute all of the shares of SpinCo, on a pro rata basis, to the Company's stockholders (the "Distribution"), (ii) Merger Sub will merge with and into SpinCo (the "Merger" and, together with the Distribution and all other transactions contemplated under the Merger Agreement, the "Transactions") with SpinCo surviving the Merger as a wholly owned subsidiary of flyExclusive and (iii) as consideration for the Merger, the Company's existing stockholders will have the right to receive shares of Class A common stock of flyExclusive. Additionally, the Company's stockholders will continue to own and hold their existing shares of the Company's common stock as of closing of the Merger.

In connection with executing the Merger Agreement, the Company, SpinCo, and flyExclusive entered into a Separation and Distribution Agreement (the "Separation and Distribution Agreement") pursuant to which the Company will transfer the business, operations, services and activities of the Company's fractional and jet card business to SpinCo and will no longer operate a fractional and jet card business (the "Separation"). Upon the terms and subject to the conditions set forth in the Separation and Distribution Agreement, the Company will consummate the Distribution and at that time cease to operate a fractional or jet card business. There will be no change expected to the Company's board of directors or executive officers as a result of the Merger, Separation, Distribution, or other Transactions.

The Transactions are subject to shareholder approval and are expected to close during the fourth quarter of 2025.

After the Transactions Jet.AI will continue to operate and retain its software and intellectual property assets, but will cease to hold its aircraft fractional, jet card and management assets and expects to pursue additional business opportunities in the broader artificial intelligence (AI) and data-center enterprise sectors.

***Joint Venture***

On June 26, 2025, the Company, entered into a Joint Venture Agreement (the "JV Agreement") with Consensus Core Technologies Inc., a British Columbia corporation ("Consensus Core"), pursuant to which the parties agreed to enter into a joint venture to collaborate in developing data centers. The JV Agreement provided certain terms of the joint venture, including: (i) the parties would enter into a Contribution Agreement (the "Contribution Agreement") with a joint venture limited liability company outlining the full terms of the joint venture; (ii) the joint venture limited liability company would be organized under the laws of the State of Delaware prior to any initial closing under the Contribution Agreement, which would initially be wholly owned by Consensus Core; and (iii) the joint venture limited liability company would establish separate subsidiaries for each data center project to be contributed to the joint venture.

On July 2, 2025, the Company entered into the Contribution Agreement with Consensus Core and Convergence Compute LLC, a Delaware limited liability company ("Convergence Compute"), pursuant to which Jet.AI contributed $300,000 to Convergence Compute in the first closing of the transactions contemplated by the JV Agreement. As consideration for its contribution, Jet.AI acquired a 0.5% equity interest in Convergence Compute. Upon the completion of certain data center project milestones, each of Jet.AI and Consensus Core will make additional contributions to Convergence Compute and will receive additional equity interests in Convergence Compute and its subsidiaries.

The Company will contribute up to an aggregate $20 million to Convergence Compute in five tranches, which are each tied to specific project development milestones. Consensus Core will contribute 100% of the equity interests of its Midwest data center project to Convergence Compute at the second closing under the Contribution Agreement and will contribute 100% of the equity interests of its Maritime data center project to Convergence Compute at the third closing under the Contribution Agreement. In consideration for such contributions, Jet.AI and Consensus Core will each receive a 17.5% equity interest in the Midwest project upon the second closing and a 17.5% equity interest in the Maritime project upon the third closing. Jet.AI will also receive an additional 0.5% equity interest in Convergence Compute upon each additional closing, for an aggregate equity interest of up to 2.5% if all five tranches are consummated.

**Results of Operations**

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

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended** | **Three Months Ended** | **Nine Months Ended** | **Nine Months Ended** |
|  | **September 30,** | **September 30,** | **September 30,** | **September 30,** |
|  | **2025** | **2024** | **2025** | **2024** |
| Revenues | $1710988 | $3917393 | $7411526 | $10849875 |
| Cost of revenues | 1999395 | 3931279 | 7925747 | 11405113 |
| &nbsp;&nbsp;&nbsp;Gross loss | (288407) | (13886) | (514221) | (555238) |
| Operating Expenses: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;General and administrative (including stock-based compensation of $175,586, $1,313,358, $1,489,654, and $3,714,404, respectively) | 1408391 | 2746783 | 6307798 | 7956830 |
| &nbsp;&nbsp;&nbsp;Sales and marketing | 300072 | 83310 | 676081 | 632380 |
| &nbsp;&nbsp;&nbsp;Research and development | 39327 | 37959 | 189295 | 107901 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total operating expenses | 1747790 | 2868052 | 7173174 | 8697111 |
| &nbsp;&nbsp;&nbsp;Operating loss | (2036197) | (2881938) | (7687395) | (9252349) |
| Other (income) expense: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Interest expense |  |  |  | 79314 |
| &nbsp;&nbsp;&nbsp;Other income | (70148) | (56) | (166519) | (176) |
| Total other (income) expense | (70148) | (56) | (166519) | 79138 |
| Loss before provision for income taxes | (1966049) | (2881882) | (7520876) | (9331487) |
| Provision for income taxes | - | - | - | - |
| &nbsp;&nbsp;&nbsp;Net Loss | $(1966049) | $(2881882) | $(7520876) | $(9331487) |
| &nbsp;&nbsp;&nbsp;Deemed dividend from warrant exchange offer |  | (540255) |  | (540255) |
| &nbsp;&nbsp;&nbsp;Cumulative preferred stock dividends | - | 18708 | - | 78163 |
| &nbsp;&nbsp;&nbsp;Net Loss to common stockholders | $(1966049) | $(3440845) | $(7520876) | $(9949905) |
| Weighted average shares outstanding - basic and diluted | 3334744 | 78523 | 2659129 | 71791 |
| Net loss per share - basic and diluted | $(0.59) | $(43.82) | $(2.83) | $(138.60) |

---

***Three Months Ended September 30, 2025 and 2024***

***Revenues***

 

Revenues for the third quarter of 2025 totaled $1.7 million, a $2.2 million decrease from 2024's third quarter revenues of $3.9 million, and were comprised of $884,000 in services revenue from the management of customers' aircraft, $0.6 million of revenues related to our software App Cirrus and Charter program (being $591,000 in software-related revenue and $51,000 in revenue from the chartering of our HondaJets by our operating partner Cirrus), and $185,000 in Jet Card revenue for hours flown and other charges based on hours flown.

The primary reason for the decrease was due to a reduction in Cirrus charter and Jet Card revenues of $1.3 million and $363,000, respectively, in the 2025 period due to the planned sale of the Company's aviation assets to flyExclusive.

The following table sets forth a breakout of revenue components by subcategory for the three months ended September 30, 2025 and 2024.

---

| | | |
|:---|:---|:---|
|  | **Three Months Ended** | **Three Months Ended** |
|  | **September 30,** | **September 30,** |
|  | **2025** | **2024** |
| Software App and Cirrus Charter | $642279 | $2409742 |
| Jet Card and Fractional Programs | 184655 | 547186 |
| Management and Other Services | 884054 | 960465 |
|  | $1710988 | $3917393 |

---

The Company recognized $592,000 in revenue related to App-generated Services and software revenues related to charter bookings made through its App in the third quarter of 2025, a decrease of $506,000 and reflected reduced brokerage staff, and greater economic uncertainties. This compares to revenues totaling $1.1 million in the 2024 period.

The Company recognized $884,000 in service revenue in the third quarter of 2025, a decrease of $76,000, relating to reduced flying by the owners of the Company's managed aircraft. There was $960,000 in service revenues in the third quarter of 2024.

During the third quarter of 2025, the Company did not sell any prepaid flight hours under its jet card and fractional programs and recognized $185,000 of revenue for 23 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. At September 30, 2025, the Company had recorded deferred revenue of $443,000 on its consolidated balance sheet representing prepaid flight hours for which the related travel had not yet occurred.

In the third quarter of 2024, the Company sold 110 prepaid flight hours, amounting to $615,000, and recognized $547,000 of revenue for 85 flight hours flown or forfeited, as well as additional charges. At September 30, 2024, the Company had recorded deferred revenue of approximately $1.2 million.

The decrease in flight hours flown period over period is a direct result of the planned sale of the Company's aviation assets to flyExclusive.

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 third quarter of 2025 and 2024:

---

| | | |
|:---|:---|:---|
|  | **For the three months ended September 30,** | **For the three months ended September 30,** |
|  | **2025** | **2024** |
| Deferred revenue at the beginning of the period (1) | $647117 | $1099466 |
| Prepaid flight hours sold |  |  |
| &nbsp;&nbsp;&nbsp;Amount | $— | $615130 |
| &nbsp;&nbsp;&nbsp;Total Flight Hours |  | 110 |
| Prepaid flight hours flown |  |  |
| &nbsp;&nbsp;&nbsp;Amount | $160258 | $480929 |
| &nbsp;&nbsp;&nbsp;Total flight hours | 23 | 85 |
| &nbsp;&nbsp;&nbsp;Additional charges | $24397 | $66257 |
| &nbsp;&nbsp;&nbsp;Total flight hour revenue | $184655 | $547186 |
| Deferred revenue at the end of the period (2) | $443015 | $1206869 |

---

(1) Deferred
 revenue at June 30, 2025 and 2024 also includes $130,025 and $56,067, respectively, with respect to customer prepayments associated
 with software app transactions and $16,233 and $16,233 with respect to customer prepayments associated with management and other
 services revenue.

(2) Deferred
 revenue at September 30, 2025 and 2024 also includes $86,181 and $29,269, respectively, with respect to customer prepayments associated
 with software app transactions and $16,233 and $16,233 with respect to customer prepayments associated with management and other
 services revenue.

In addition to its software App and jet card revenues, the Company also generates revenue through the direct chartering of its HondaJet aircraft by Cirrus. During the third quarter of 2025 this revenue amounted to approximately $51,000, a decrease of $1.3 million, or 96.1% from the prior year period. The decreased revenue was a direct result of the decreased chartering of the Company's HondaJet fleet, as well as decreased software app bookings in the third quarter of 2025 as compared to the third quarter of 2024.

***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 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 third quarter of 2025, the Company operated three HondaJets, one King Air 390i and one CJ4.

As a result of the decrease in Cirrus charter flight activity, costs related to the operation of these aircraft and payments to Cirrus for their management decreased $1.7 million from $3.1 million in the third quarter of 2024 to $1.4 million in 2025, and aircraft lease payments remained the same at $321,000 in the third quarter of 2025 and 2024. The Company also incurred third-party charter costs of approximately $546,000 in the third quarter of 2025, a $358,000 decrease over 2024, reflecting the reduced number of App-generated charter bookings, and a reduction in subcharters used for covering jet card flights when our HondaJets were unavailable. Merchant fees and federal excise tax relating to charter flights of $60,000 in the third quarter of 2025 were a $70,000 decrease as compared to $130,000 in the third quarter of 2024.

In total, it cost $2.0 million to operate these five aircraft in the third quarter of 2025, compared to $3.9 million to operate four aircraft in the third quarter of 2024.

***Gross loss***

 

The resulting gross loss totaled approximately $288,000 for the third quarter of 2025, compared to a gross loss of $14,000 for the third quarter of 2024. The gross loss in the third quarter of 2025 was largely driven by reduced flights performed for our jet card customers without a corresponding reduction in fixed costs.

***Total Operating Expenses***

 

In the third quarter of 2025, the Company's operating expenses decreased by approximately $1.2 million over the prior year comparable period due to an approximate $1.3 million decrease in general and administrative expenses, a $217,000 increase in sales and marketing expenses and a $1,000 increase in research and development costs. Excluding non-cash stock-based compensation of $176,000 and $1.3 million in the third quarter of 2025 and 2024, respectively, general and administrative expenses declined by approximately $129,000 primarily due to a decrease in professional service expenses of $238,000 with a substantial portion of these expenses during the 2025 period related to the potential flyExclusive transaction, offset by an increase in Directors and Officers Insurance costs of $42,000 and decreased wages of $38,000, primarily due to decreased commissions compensation payable on software app revenue.

The Company's sales and marketing expenses increased by $217,000 to $300,000 in the third quarter of 2025 from $83,000 in the third quarter of 2024. These expenses are mainly linked to promoting the Company and its programs, including its transitioning its primary focus to AI data center operations and assets.

Research and development expenses increased $1,000 in the third quarter of 2025 from $38,000 in the third quarter of 2024, due to the reduced need to refine the App, offset by continued development work on additional software offerings.

***Operating Loss***

As a result of all of the above, in the third quarter of 2025 the Company recognized an operating loss of approximately $1.9 million, which was a decrease in loss of approximately $1.0 million when compared to the prior year period. The decrease in operating loss was primarily due to the decrease in general and administrative expenses resulting from the decrease in non-cash stock-based compensation expenses that resulted from the non-cash vesting of employee stock options as well as the decrease in professional costs.

***Other (Income) Expense***

 

During the third quarter of 2025, the Company recognized approximately $70,000 in other income as compared to $56.

***Nine Months Ended September 30, 2025 and 2024***

 

***Revenues***

 

Revenues for the first nine months of 2025 totaled $7.4 million, a $3.4 million decrease from revenues of $10.8 during the comparable period in 2024. Revenues in the 2024 period were comprised of approximately $6.4 of revenues related to our software App and Cirrus charter services (comprised of approximately $3.4 million in software-related revenue and $2.9 million in revenue from the chartering of our HondaJets by our operating partner Cirrus), $2.7 million in services revenue from the management of customers' aircraft, and $1.8 million in Jet Card revenue for hours flown and other charges based on hours flown.

The following table sets forth a breakout of revenue components by subcategory for the nine months ended September 30, 2025 and 2024.

---

| | | |
|:---|:---|:---|
|  | **Nine Months Ended** | **Nine Months Ended** |
|  | **September 30,** | **September 30,** |
|  | **2025** | **2024** |
| Software App and Cirrus Charter | $3763924 | $6391732 |
| Jet Card and Fractional Programs | 949306 | 1783066 |
| Management and Other Services | 2698296 | 2675077 |
|  | $7411526 | $10849875 |

---

The Company began recording revenue in September 2020 reflecting services and software revenues related to charter bookings made through its App and in the first nine months of 2025, the Company recognized $2.4 million in revenue related to App-generated charter bookings. During 2024 these revenues totaled $3.4 million, a $1.0 million or 29.5% decrease from 2024 reflecting reduced brokerage staff and greater economic uncertainties.

The Company recognized $2.7 million in service revenue in the first nine months of 2025, flat from 2024. There was $2.7 million in service revenues in the first nine months of 2024.

During the first nine months of 2025, the Company sold 20 prepaid flight hours under its jet card and fractional programs, amounting to $116,000, and recognized $1.0 of revenue for 150 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. At September 30, 2025, the Company recorded deferred revenue of $443,000 on its consolidated balance sheet, which represents prepaid flight hours for which the related travel had not yet occurred.

In the first nine months of 2024, we sold 220 prepaid flight hours amounting to approximately $1.3 million and recognized approximately $1.8 million of revenue for 267 flight hours flown or forfeited, as well as additional charges. At September 30, 2024, the Company recorded deferred revenue of $1.2 million on its consolidated balance sheet.

The decrease in flight hours flown is a direct result of is a direct result of the planned sale of the Company's aviation assets to flyExclusive.

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 nine months of 2025 and 2024:

---

| | | |
|:---|:---|:---|
|  | **For the nine months ended September 30,** | **For the nine months ended September 30,** |
|  | 2025 | 2024 |
| Deferred revenue at the beginning of the period (1) | $1319746 | $1779794 |
| Prepaid flight hours sold |  |  |
| &nbsp;&nbsp;&nbsp;Amount | $116000 | $1270130 |
| &nbsp;&nbsp;&nbsp;Total Flight Hours | 20 | 220 |
| Prepaid flight hours flown |  |  |
| &nbsp;&nbsp;&nbsp;Amount | $866634 | $1619739 |
| &nbsp;&nbsp;&nbsp;Total flight hours | 150 | 267 |
| &nbsp;&nbsp;&nbsp;Additional charges | $82672 | $163327 |
| &nbsp;&nbsp;&nbsp;Total flight hour revenue | $949306 | $1783066 |
| Deferred revenue at the end of the period (2) | $443015 | $1206869 |

---

(1) Deferred
 revenue at December 31, 2024 and 2023 also includes $212,278 and $268,818, respectively, with respect to customer prepayments associated
 with software app transactions.

(2) Deferred
 revenue at September 30, 2025 and 2024 also includes $86,181 and $29,269, respectively, with respect to customer prepayments associated
 with software app transactions and $16,233 and $16,233 with respect to customer prepayments associated with management and other services
 revenue.

During the first nine months of 2025 revenue generated through the direct chartering of the Company's HondaJet aircraft by Cirrus amounted to approximately $1.3 million, a decrease of $1.6 million, or 54.6% from the prior year. The decreased revenue was a direct result of decreased charter activity, both ad hoc and by Cirrus.

***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 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 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 decrease in jet card and Cirrus charter flight activity, operating expenses related to the operation of the Company's aircraft and payments to Cirrus for their management decreased $2.2 million from $6.9 million in the first nine months of 2024 to $4.7 million in the 2025 year period and aircraft lease payments decreased $53,000 from $1.0 million in 2024 to $969,000 in the first nine months of 2025. The Company also incurred third-party charter costs of approximately $1.9 million in the first nine months of 2025, a $980,000 decrease over 2024, as a result of the reduction in as hoc charters and a reduced need for subcharters used for covering jet card flights when our HondaJets were unavailable. Federal excise tax and merchant fees relating to charter flights decreased $321,000 in the first nine months of 2025 to $219,000 from $540,000 in 2024.

In total, it cost $7.9 million to operate the Company's 5 aircraft in the first nine months of 2025, compared to $11.4 million in 2024.

***Gross loss***

 

The resulting gross loss totaled $514,000 for the first nine months of 2025, compared to $555,000 for the 2024 period. The decreased gross loss in these operations was a result of decreased maintenance costs, together with lower utilization on our HondaJets.

***Total Operating Expenses***

 

In the first nine months of 2025, the Company's operating expenses decreased $1.6 million due to a $1.6 million decrease in general and administrative expenses. Excluding non-cash stock-based compensation of $1.5 million and $3.7 million in the first nine months of 2025 and 2024, respectively, general and administrative expenses rose by approximately $576,000 primarily due to due to increased wages of $408,000, primarily due to increased commissions compensation payable on charter sales and a $102,000 increase in professional service expenses related to the potential flyExclusive transaction.

The Company's sales and marketing expenses increased by about $44,000 to $676,000 in the first nine months of 2025 from $632,000 in 2024. These expenses are mainly linked to promoting the Company and its programs.

Research and development expenses also increased $81,000 to $189,000 in the first nine months of 2025 from $108,000 in 2024, due to the continued development work on additional software offerings.

***Operating Loss***

 

As a result of all of the above, in the first nine months of 2025 the Company recognized an operating loss of approximately $7.6 million, which was a decrease in loss of $1.6 million compared to the 2024 period. The decrease was primarily due to reduced operating expenses of $1.6 million, and a decrease in the Company's gross loss of $37,000.

***Other (Income) Expense***

 

During the first nine months of 2025, the Company recognized approximately $167,000 in other income due primarily to interest income during the period, compared to $79,000 in other expense due primarily to interest expense related to the Bridge Agreement recorded for the first nine months of 2024.

**Liquidity and Capital Resources**

***Overview***

As of September 30, 2025, our cash and cash equivalents totaled $3.5 million. Current assets exceeded current liabilities by $3.3 million, including $443,000 in deferred revenue, which will be recognized as revenue upon the utilization or forfeiture of prepaid flight hours.

In the first nine months of 2025, we raised $11.0 million through the issuance of 1,100 shares of Series B Preferred Stock, which was the primary factor causing our cash and cash equivalent assets and current assets as a whole to increase from December 31, 2024.

We have historically incurred negative cash flows from operations and significant operating losses, resulting in an accumulated deficit of $60.1 million as of September 30, 2025. We anticipate revenue and operating profit growth from strategic initiatives, including aircraft acquisitions, increased Jet Card pricing, enhanced charter activity through CharterGPT, Ava, and Reroute AI, and SaaS revenue from DynoFlight. However, we expect to incur operating losses for at least the next 12 months, depending on the success and timing of these initiatives. To fund operations, we plan to utilize funds from potential sales of equity or debt securities. Contractual limitations may restrict certain funding options, and further equity issuances may adversely affect our stock price and ability to raise capital. To support growth, we have executed a non-binding term sheet for a proposed $50 million financing transaction, with economic terms similar to our existing $16.5 million arrangement with Ionic Ventures LLC.

The term sheet reflects the parties' agreement in principle on material deal terms, including the issuance of Series C Convertible Preferred Stock and related warrants, subject to finalization and execution of definitive documentation. There can be no assurance that such definitive agreements will be entered into or that the proposed transaction will be consummated.

In the absence of external financing, we are prepared to reduce cash utilization by halting marketing, suspending software development, streamlining operations, and focusing on existing customers, enabling operations to continue for at least one year, during which we would seek new financing to resume full operations. Forward-looking statements regarding our financial condition and liquidity are subject to risks and uncertainties, as detailed in Part I, Item 1A, "Risk Factors" of our Annual Report on Form 10-K for the year ended December 31, 2024, as filed with the SEC on March 26, 2025.

***Ionic Transaction***

*General*

On March 28, 2024, the Company entered into a Securities Purchase Agreement (the "Series B Securities Purchase Agreement") and a number of other transaction documents described below for a private placement with Ionic Ventures, LLC ("Ionic"), which closed on March 29, 2024, which we collectively refer to as the "Ionic Transaction." Under the Series B Securities Purchase Agreement, the Company issued to Ionic (i) 150 shares of the Company's Series B Preferred Stock, which are convertible into shares of the Company's common stock, (ii) a warrant to purchase up to 1,500 shares of Series B Preferred Stock (the "Ionic Warrant"), at an exercise price of $10,000 per share, and (iii) 1,111 shares of the Company's common stock. As of the date of this Report, Ionic has fully exercised the Ionic Warrant for a total of 1,500 shares of Series B Preferred Stock, resulting in gross proceeds to the Company of $15.0 million. And, therefore we do not expect to receive additional funds from Ionic under the terms of the Series B Securities Purchase Agreement and Ionic Warrant.

*Series B Preferred Stock*

On March 28, 2024, we filed a Certificate of Designation 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 "Certificate of Designations"). The Series B Preferred Stock ranks 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, as amended ("Exchange Act")), which can be adjusted to a beneficial ownership limitation of 9.99% upon 61 days prior written notice by Ionic. From time to time Ionic 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 Ionic's beneficial ownership at any point in time, it does not prohibit Ionic 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 Ionic'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 the lower of (i) $2.50, or (ii) 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 Ionic 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, then we may be required to redeem the Series B Preferred Stock for cash at 110% of the stated value.

*Other Transaction Documents and Subsequent Agreements*

The Ionic Warrant exercise price was 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.

The Series B 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 Ionic initially agreed that the Required Reserve Amount was 200,000 shares of Common Stock.

*Registration Statements*

Pursuant to the Registration Rights Agreement entered into by the Company and Ionic on March 29, 2024, we filed a Registration Statement on Form S-1 (File No. 333-279385), which was originally filed with the SEC on May 13, 2024, and as amended (the "First Registration Statement"), that registered the offer and resale of 133,778 shares of common stock (as adjusted to reflect the subsequent reverse stock split) by Ionic. The First Registration Statement was declared effective by the SEC on July 24, 2024. On November 13, 2024, Ionic notified the Company that it had sold all shares of common stock that were registered under the First Registration Statement.

Since the number of shares of common stock available under the First Registration Statement was insufficient to cover all of the shares of common stock issuable to Ionic, we were required to file at least one additional registration statement. Accordingly, on November 13, 2024, we filed a Registration Statement on Form S-3 (File No. 333-283207) with the SEC (as amended, the "Second Registration Statement"), which registered the offer and resale of 600,000 shares of common stock by Ionic and was declared effective by the SEC on December 27, 2024. On February 20, 2025, Ionic notified the Company that it had sold all shares of common stock that were registered under the Second Registration Statement.

Since the number of shares of common stock available under the First Registration Statement and the Second Registration Statement were, in the aggregate, insufficient to cover all of the shares of common stock issuable to Ionic, we were required to file at least one additional registration statement. Accordingly, on January 24, 2025, we filed another Registration Statement on Form S-3 (File No. 333-284504) with the SEC (as amended, the "Third Registration Statement"), to register an additional 1,270,000 shares of common stock for offer and resale by Ionic. As of the date hereof, 929,255 shares of common stock have been sold.

*Conversions of Series B Preferred Stock; Warrant Exercises*

Starting in October 2024, and through the date of this Report, Ionic has converted in full the 150 shares of Series B Preferred Stock issued to it at the initial closing of the Ionic Transaction, the 50 additional shares of Series B Preferred Stock issued to it in connection with an agreement between parties, and 200 shares of Series B Preferred Stock issued to it pursuant to partial exercises of the Ionic Warrant. Those conversions, in total, resulted in the issuance of 835,261 shares of Common Stock (as adjusted to give effect to the reverse stock split).

Ionic effected partial exercises of the Ionic Warrant on the following dates and in the following amounts: (i) on October 28, 2024, for 150 additional shares of Series B Preferred Stock, resulting in total proceeds to the Company of $1.5 million, (ii) on November 14, 2024, for 250 additional shares of Series B Preferred Stock, resulting in total proceeds to the Company of $2.5 million, (iii) on January 23, 2025, for 250 additional shares of Series B Preferred Stock, resulting in total proceeds to the Company of $2.5 million, and (iv) on February 27, 2025, for 850 additional shares of Series B Preferred Stock, resulting in total proceeds to the Company of $8.5 million.

*Adjustment to Beneficial Ownership Limitation*

On February 14, 2025, Ionic delivered a notice to the Company that it had elected to increase the beneficial ownership limitation to 9.99%. The adjusted beneficial ownership limitation took effect on April 16, 2025.

***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 $2,550,024 to date. In consideration for GEM's services under the Share Purchase Agreement, the Company paid GEM a commitment fee equal to $800,000 in shares of common stock. Upon the Company's issuance of shares in connection with any drawdown purchase made by GEM, the Company was 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 was due on or before the first anniversary of the closing of the Business Combination. In October 2024, the Company issued 58,447 shares of common stock to satisfy in full the outstanding commitment fee payable and 44,225 shares of common stock under the Share Purchase Agreement with GEM for total consideration of $2.5 million.

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 GEM Warrant included an adjustment mechanism, whereby the exercise price is subject to adjustment from time to time. Pursuant to the Warrant, on the first anniversary following the Public Listing Date as defined in the GEM Warrant (the "Adjustment Date"), if all or any portion of the GEM Warrant remains unexercised and the average closing price of the Company's common stock for the 10 trading days following the Adjustment Date is less than 90% of the then current exercise price of the warrant (the "Baseline Price"), then the exercise price of the unexercised Warrant Shares that remain exercisable pursuant to the Warrant shall be adjusted to 110% of the Baseline Price. Accordingly, the warrant exercise price was reduced to $9.07 per share as of September 30, 2025. 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 the Company'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.

***Cash Flows for the Nine Months Ended September 30, 2025 and 2024***

 

As of September 30, 2025, the Company's cash and equivalents were approximately $3.5 million.

The following table summarizes our cash flows for the nine months ended September 30, 2025 and 2024:

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| | | |
|:---|:---|:---|
|  | **For the nine months ended September 30,** | **For the nine months ended September 30,** |
|  | 2025 | 2024 |
| Net cash used in operating activities | $(8917202) | $(4840533) |
| Net cash used in investing activities | (2227790) | (12922) |
| Net cash provided by financing activities | 8747775 | 3064795 |
| Decrease in cash and cash equivalents | $(2397217) | $(1788660) |

---

*Cash Flow from Operating Activities*

Net cash used in operating activities for the nine months ended September 30, 2025 was $8.9 million compared to $4.8 million for the nine months ended September 30, 2024. The cash outflow from operating activities in the 2025 period primarily consisted of our net loss, net of non-cash charges, of $5.6 million, a $0.4 million reduction in lease liability, a $229,000 decrease in operating liabilities and a $2.6 million increase in accounts receivables and other current assets. The decrease in operating liabilities was primarily driven by a $877,000 decrease in deferred jet card revenue relating to the sale of jet card hours not yet flown, partially offset by a $648,000 increase in the Company's accounts payable and accrued liabilities relating to the operation of the Company's aircraft. Net cash used in operating activities for the nine months ended September 30, 2024 was $4.8 million. The cash outflow from operating activities in the 2024 period primarily consisted of our net loss, net of non-cash charges of $4.2 million, a $0.4 million reduction in lease liability, which were offset by a $1.2 million increase in operating liabilities and a $41,000 reduction in accounts receivable and other current assets. The increase in operating liabilities was primarily driven by a $1.2 million increase in the Company's accounts payable and accrued liabilities relating to the operation of the Company's aircraft and a $0.6 million decrease in deferred jet card revenue relating to the sale of jet card hours not yet flown.

*Cash Flow from Investing Activities*

Net cash used in investing activities for the nine months ended September 30, 2025 was $2.2 million as compared to $13,000 in the 2024 year period, primarily relating to the Company's joint venture investment, advances under related party promissory note and additional Textron deposits.

*Cash Flow from Financing Activities*

Net cash provided by financing activities for the nine months ended September 30, 2025 was $8.7 million. Cash provided by financing activities was primarily driven by the sale of preferred stock, partially offset by offering costs. Net cash provided by financing activities for the nine months ended September 30, 2024 was $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 by 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 financial statements for the nine months ended September 30, 2025 for a further description of these leasing arrangements.

**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, 2022 and those activities continued into 2025. During the next twelve months, the Company intends to fund its operations with funds from its operations, proceeds received from prior drawdowns under the Share Purchase Agreement, as well as proceeds from other prospective 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 the Company 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 the Company, accompanied by a recapitalization. The net assets of the Company 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:

● Jet Token's former stockholders had the greatest voting interest in the combined entity;

● Jet Token's former stockholders had the ability to nominate a majority of the initial members of the combined entity board;

● Jet Token's senior management is the senior management of the combined entity;

● Jet Token is the larger entity based on historical operating activity and has the larger employee base; and

● The post-combination company has assumed a Jet Token branded name: "Jet.AI Inc."

***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.

***Revenue Recognition***

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

● Identification of the contract, or contracts, with a customer;

● Identification of the performance obligations in the contract;

● Determination of the transaction price;

● Allocation of the transaction price to the performance obligations in the contract; and

● Recognition of revenue when, or as, a performance obligation is satisfied.

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 Ava) 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.

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.

&nbsp;&nbsp;&nbsp;&nbsp;1. <u>Chartering Third-Party Aircraft:</u> The cost of chartering second-party aircraft is recorded as a part of the cost of sales expense. These
 expenses include the fees paid to second-party operators for providing aircraft services on behalf of the company. Expenses are recognized
 in the income statement in the period when the service is rendered and are reported on an accrual basis.

2. <u>Aircraft Lease Expenses:</u> Aircraft lease expenses include the cost of leasing aircraft for the company's operations. The lease expenses
 are recognized as an operating expense in the income statement over the lease term on a straight-line basis.

3. <u>Pilot Training and Wages:</u> Pilot training costs are expensed as incurred and are included in the cost of sales expenses. This encompasses
 expenses related to initial pilot training, recurrent training, and any additional required training programs. Pilot wages, including
 salaries, bonuses, and benefits, are also recognized as a part of the cost of sales expenses and are reported on an accrual basis.

4. <u>Aircraft Fuel:</u> The cost of aircraft fuel is recognized as an expense in the cost of sales category based on the actual consumption during
 flight operations. Fuel costs are recorded in the income statement in the period when the fuel is consumed and are reported on an
 accrual basis.

5. <u>Aircraft Maintenance:</u> Aircraft maintenance expenses include both routine and non-routine maintenance. Routine maintenance costs are expensed
 as incurred and are recorded as a part of the cost of sales expense. Non-routine maintenance expenses, such as major repairs and
 overhauls, are capitalized and amortized over their expected useful life. The amortization expense is included in the cost of sales
 expense and is recognized in the income statement on a straight-line basis over the asset's useful life.

6. <u>Other Aircraft Operating Expenses:</u> Other aircraft operating expenses include costs such as insurance, landing fees, navigation charges,
 and catering services. These expenses are recognized in the income statement as a part of the cost of sales expenses in the period
 when they are incurred and are reported on an accrual basis.

***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, competition and other barriers to entry in the data center industry, and market acceptance of the Company's business model. These adverse conditions could affect the Company's financial condition and the results of operations.

**ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK**

The Company is not required to provide the information required by this Item as it is a "smaller reporting company," as defined in Rule 12b-2 of the Exchange Act.

**ITEM 4. CONTROLS AND PROCEDURES**

**Evaluation of Disclosure Controls and Procedures**

Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is accumulated and communicated to our management, including our Interim Chief Executive Officer and Interim Chief Financial Officer, to allow timely decisions regarding required disclosure.

As required by Rules 13a-15 and 15d-15 under the Exchange Act, our Interim Chief Executive Officer and Interim Chief Financial Officer carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of September 30, 2025. Based on that evaluation, our Interim Chief Executive Officer and our Interim Chief Financial Officer have concluded that our disclosure controls and procedures were effective as of the end of the periods covered by this report.

**Changes in Internal Control over Financial Reporting**

There were no changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) that occurred during the quarter ended on September 30, 2025 covered by this Quarterly Report on Form 10-Q that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

**PART II OTHER INFORMATION**

**ITEM 1. LEGAL PROCEEDINGS.**

None.

**ITEM 1A. RISK FACTORS.**

Except as set forth below, as of the date of this Quarterly Report, there have been no material changes from the risk factors previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2024, as filed with the SEC on March 26, 2025. Any of these factors could result in a significant or material adverse effect on our results of operations or financial condition. Additional risk factors not presently known to us or that we currently deem immaterial may also impair our business or results of operations.

***We have made a significant investment in the sponsor of a blank check company commonly referred to as a special purpose acquisition company ("SPAC"), and will suffer the loss of all of our investment if the SPAC does not complete an acquisition by April 6, 2027***

In July 2025, we made a capital contribution of approximately $2.7 million in AIIA Sponsor Ltd. ("Sponsor"), that served as the sponsor of AI Infrastructure Acquisition Corp., a special purpose acquisition company ("AII Acquisition"). The capital contribution was made to fund, in part, Sponsor's purchase of units comprised of Class A ordinary shares and rights to receive additional Class A ordinary shares of AII Acquisition as part of the sponsorship of AII Acquisition. The Company owns approximately 49.9% interest in the Sponsor, and in turn the Sponsor owns approximately 25% of the outstanding ordinary shares of AII Acquisition.

There is no assurance that AII Acquisition will be successful in completing a business combination or that any business combination will be successful. The Company could lose its entire investment in Sponsor if a business combination is not completed by April 6, 2027 or if the business combination is not successful, which would materially adversely impact our shareholder value.

**ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.**

**Unregistered Sales of Equity Securities**

During the quarter ended September 30, 2025 the Company did not issue any equity securities in transactions that were not registered under the Securities Act of 1933, as amended, except in connection with transactions that were previously reported or disclosed in a report filed by the Company with the Securities and Exchange Commission.

**Purchases of Equity Securities by the Issuer and Affiliated Purchasers**

There were no purchases of equity securities by the Company or its affiliates during the quarter ended September 30, 2025.

**ITEM 3. DEFAULTS UPON SENIOR SECURITIES.**

None.

**ITEM 4. MINE SAFETY DISCLOSURES.**

Not applicable.

**ITEM 5. OTHER INFORMATION.**

During the quarter ended September 30, 2025, there was no information required to be disclosed in a report on Form 8-K which was not disclosed in a report on Form 8-K.

During the quarter ended September 30, 2025, there were no material changes to the procedures by which stockholders may recommend nominees to our board of directors.

During the quarter ended September 30, 2025, none of the Company's directors or officers adopted, modified, or terminated a "Rule 10b5-1 trading arrangement" or a "non-Rule 10b5-1 trading arrangement," as those terms are defined in Item 408 of Regulation S-K.

**ITEM 6. EXHIBITS.**

The following exhibits are filed as part of, or incorporated by reference into, this Quarterly Report.

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| | |
|:---|:---|
| **Exhibit Number** | **Description** |
| 2.1 | [Amendment No. 1 to Amended and Restated Agreement and Plan of Merger and Reorganization, dated July 30, 2025, between Jet.AI Inc., flyExclusive, Inc., FlyX Merger Sub, Inc., and Jet.AI SpinCo, Inc. (incorporated by reference to Exhibit 2.1 of Jet.AI's Current Report on Form 8-K filed with the SEC on July 30, 2025)](https://www.sec.gov/Archives/edgar/data/1861622/000149315225011501/ex2-1.htm) |
| 3.1 | [Certificate of Incorporation of Jet.AI Inc., as amended through November 12, 2024 (incorporated by reference to Exhibit 3.1 of Jet.AI's Annual Report on Form 10-K for the year ended December 31, 2024).](https://www.sec.gov/Archives/edgar/data/1861622/000164117225000794/ex3-1.htm) |
| 3.2 | [Certificate of Designation of the Series A Convertible Preferred Stock of Jet.AI Inc., as amended through July 15, 2024 (incorporated by reference to Exhibit 3.2 of Jet.AI's Annual Report on Form 10-K for the year ended December 31, 2024).](https://www.sec.gov/Archives/edgar/data/1861622/000164117225000794/ex3-2.htm) |
| 3.3 | [Certificate of Designation of the Series A-1 Convertible Preferred Stock of Jet.AI Inc., dated August 10, 2024 (incorporated by reference to Exhibit 3.3 of Jet.AI's Current Report on Form 8-K filed with the SEC on August 14, 2023).](https://www.sec.gov/Archives/edgar/data/1861622/000149315223028481/ex3-3.htm) |
| 3.4 | [Certificate of Designations of Series B Convertible Preferred Stock of Jet.AI Inc., as amended through February 14, 2025. (incorporated by reference to Exhibit 3.4 of Jet.AI's Form 10-K for the year ended December 31, 2024).](https://www.sec.gov/Archives/edgar/data/1861622/000164117225000794/ex3-4.htm) |
| 3.5 | [Bylaws of Jet.AI Inc., as amended through August 5, 2024 (incorporated by reference to Exhibit 3.5 of Jet.AI's Annual Report on Form 10-K for the year ended December 31, 2024).](https://www.sec.gov/Archives/edgar/data/1861622/000164117225000794/ex3-5.htm) |
| 31.1\* | [Certification of Principal Executive Officer Pursuant to Securities Exchange Act Rules 13a-14(a) and 15(d)-14(a), as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.](ex31-1.htm) |
| 31.2\* | [Certification of Principal Financial Officer Pursuant to Securities Exchange Act Rules 13a-14(a) and 15(d)-14(a), as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.](ex31-2.htm) |
| 32.1\*\* | [Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.](ex32-1.htm) |
| 32.2\*\* | [Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.](ex32-2.htm) |

---

\* Filed herewith. <br> \*\* Furnished herewith.

**SIGNATURE**

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

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| | | |
|:---|:---|:---|
|  | **JET.AI INC.** | **JET.AI INC.** |
|  | By: | */s/ George Murnane* |
|  | Name: | George Murnane |
|  | Title: | Interim Chief Financial Officer |
|  |  | (Principal Financial Officer and Accounting Officer) |
| Date: November 14, 2025 |  |  |

---

## Exhibit 31.1

**Exhibit 31.1**

**Certification of Chief Executive Officer**

I, Mike Winston, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Jet.AI Inc. (the " <u>registrant</u> ");

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's Board of Directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

---

| |
|:---|
| Date: November 14, 2025 |
| */s/ Mike Winston* |
| Mike Winston |
| Interim Chief Executive Officer (Principal Executive Officer) |

---

## Exhibit 31.2

**Exhibit 31.2**

**Certification of Chief Financial Officer**

I, George Murnane, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Jet.AI Inc. (the " <u>registrant</u> ");

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's Board of Directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

---

| |
|:---|
| Date: November 14, 2025 |
| */s/ George Murnane* |
| George Murnane |
| Interim Chief Financial Officer (Principal Financial Officer) |

---

## Exhibit 32.1

**Exhibit 32.1**

**Certification of Chief Executive Officer**

**Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of The Sarbanes-Oxley Act of 2002**

I, Mike Winston, Interim Chief Executive Officer of Jet.AI Inc. (the "<u>Company</u>"), certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that:

&nbsp;&nbsp;&nbsp;&nbsp;(i) The Quarterly Report on Form 10-Q of Jet.AI Inc. for the period ended September 30, 2025 (the " <u>Report</u> ") fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, and

(ii) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company at the dates and for the periods indicated.

---

| |
|:---|
| Dated: November 14, 2025 |
| */s/ Mike Winston* |
| Mike Winston |
| Interim Chief Executive Officer |
| (Principal Executive Officer) |

---

## Exhibit 32.2

**Exhibit 32.2**

**Certification of Chief Financial Officer**

**Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of The Sarbanes-Oxley Act of 2002**

I, George Murnane, Interim Chief Financial Officer of Jet.AI Inc. (the "<u>Company</u>"), certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that:

&nbsp;&nbsp;&nbsp;&nbsp;(i) The Quarterly Report on Form 10-Q of Jet.AI Inc. for the period ended September 30, 2025 (the " <u>Report</u> ") fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, and

(ii) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company at the dates and for the periods indicated.

---

| |
|:---|
| Dated: November 14, 2025 |
| */s/ George Murnane* |
| George Murnane |
| Interim Chief Financial Officer |
| (Principal Financial Officer) |

---