Stock Performance and Market Conditions - Airship AI's common stock was last reported at $4.48, while the exercise price of public warrants is $4.50, indicating potential challenges for warrant holders to exercise their options [187]. - The stock market for Airship AI's securities may experience significant volatility, which could lead to substantial fluctuations in market price [186]. - The company has limited liquidity in its stock market, which may hinder investors' ability to sell their securities [174]. - The company may become subject to penny stock rules if its common stock price falls below $5.00, which could reduce trading activity and make it difficult for shareholders to sell their shares [191]. - The reduced reporting requirements for smaller reporting companies may make the company's common stock less attractive to investors [193]. Ownership and Control - The concentration of ownership among key stockholders, who control approximately 49.5% of voting power, may limit public investors' influence and could adversely affect stock price [175]. - Anti-takeover provisions in the company's charter could delay or prevent undesirable acquisitions, potentially limiting stockholder opportunities to receive a premium for their shares [196]. - The company’s charter requires that certain stockholder litigation matters be brought in the Court of Chancery of the State of Delaware, which may limit stockholders' ability to obtain a favorable judicial forum [197]. - The board of directors has the ability to issue preferred stock without stockholder approval, which could significantly dilute the ownership of a hostile acquirer [198]. - A special meeting of stockholders can only be called by the board of directors or the chairman, potentially delaying stockholder actions [198]. Financial Performance and Liabilities - The company has not capitalized any software development costs for the years ended December 31, 2024, and 2023, indicating a focus on operational expenses until technological feasibility is established [173]. - Airship AI is subject to significant tax liabilities, with potential volatility in tax provisions due to changes in operating structures and tax laws, which could adversely impact financial results [170]. - Changes in tax laws, particularly those enacted by the 2017 Tax Cuts and Jobs Act, may require capitalization of research and experimental expenditures, impacting financial reporting [172]. - The company does not intend to pay cash dividends in the foreseeable future, meaning returns for investors will rely on increases in stock value [185]. Regulatory and Compliance Risks - Compliance with public company regulations may strain resources and divert management's attention from core business activities, affecting overall performance [178]. - The company may incur additional costs if a court finds its choice of forum provision inapplicable, which could harm its business and financial condition [199]. - The company is subject to various risks including loss of strategic relationships, variations in operating results, and competitive pricing pressures [192]. Company Status and Growth Potential - The company will remain a smaller reporting company until the market value of its common stock held by non-affiliates exceeds $250 million or annual revenues exceed $100 million and market value exceeds $700 million [194]. - The company will remain an emerging growth company until it has total annual gross revenue of at least $1.23 billion or issues more than $1.00 billion in non-convertible debt securities during the prior three-year period [195].

Financial Performance - Net revenues for the three months ended September 30, 2024, increased by $484,000 to $2,868,000 compared to $2,384,000 for the same period in 2023, driven by increased product sales[191] - Gross profit for the three months ended September 30, 2024, was $2,154,000, representing a 34.5% increase from $1,602,000 in the same period of 2023[191] - The company reported a net income of $6,214,000 for the three months ended September 30, 2024, compared to a net loss of $1,667,000 in the same period of 2023, marking a 472.8% improvement[191] - Net revenues for the nine months ended September 30, 2024 increased by $11,751,000 to $19,844,000, a growth of 145.2% compared to $8,093,000 for the same period in 2023, driven by increased product sales[198] - Gross profit for the nine months ended September 30, 2024 was $9,288,000, up 127.6% from $4,080,000 in the same period of 2023[198] - Other income for the three months ended September 30, 2024 was $7,801,000, a significant increase from other expense of $438,000 in the same period of 2023[195] Expenses - Research and development expenses decreased by 55.9% to $1,074,000 for the three months ended September 30, 2024, compared to $689,000 in the prior year[191] - Total operating expenses for the three months ended September 30, 2024, were $3,741,000, a decrease of 32.1% from $2,831,000 in the same period of 2023[191] - Research and development expenses for the nine months ended September 30, 2024 increased by $444,000 to $2,472,000, a rise of 21.9% compared to $2,028,000 for the same period in 2023[200] - Selling, general and administrative expenses for the nine months ended September 30, 2024 increased by $762,000 to $8,830,000, a 9.4% increase from $8,068,000 in the prior year[201] Cash Flow and Financing - Net cash used in operating activities for the nine months ended September 30, 2024 was $4,398,000, primarily due to a net loss of $7,289,000[207] - Net cash provided by financing activities for the nine months ended September 30, 2024 was $7,780,000, consisting mainly of proceeds from an offering[209] - The company entered into a Master Loan Agreement providing for additional funding of up to $1,500,000, with an interest rate of 6%[178] Liabilities and Obligations - The fair value of earnout liability increased by $5,512,000 during the three months ended September 30, 2024, compared to no prior gain in the same period[191] - The fair value of warrant liability increased by $2,471,000 during the three months ended September 30, 2024, compared to no prior gain in the same period[191] - The company had an accumulated deficit of $24.8 million as of September 30, 2024, but determined it has no substantial doubt about its ability to continue as a going concern[206] - The company has total contractual cash obligations of $1,138,331, with $359,746 due within one year[215] Lease Agreements - A new lease for 15,567 square feet of office and warehouse space in Redmond, WA, commenced on October 1, 2023, with a monthly payment of $25,000, increasing by 3% annually[215] - The company extended an office lease in Moorestown, North Carolina, for 3,621 square feet, with a net monthly payment of $6,488, extended to February 28, 2025[216] Accounting and Reporting - The company's consolidated financial statements are prepared in accordance with U.S. GAAP, requiring estimates and assumptions that could differ materially from actual results[218] - Significant accounting policies have not materially changed from those discussed in the Annual Report for the year ended December 31, 2023[220] - The company does not have applicable quantitative and qualitative disclosures about market risk as it is classified as a smaller reporting company[221]

Financial Performance - Second quarter 2024 net revenues reached $6.4 million, with a gross profit of $4.5 million and a gross margin of 70%[2] - Operating income for the second quarter was $1.0 million, indicating progress towards achieving cash flow positivity for the full year[2] - First half 2024 combined net revenue totaled $17.0 million, representing 128% of the company's total revenue for the full year 2023[1] - Total net revenues for the three months ended June 30, 2024, reached $6,401,031, a significant increase from $2,770,018 in the same period of 2023, representing a growth of approximately 131%[19] - Gross profit for the six months ended June 30, 2024, was $7,134,334, compared to $2,477,616 for the same period in 2023, indicating a year-over-year increase of about 187%[19] - Operating income for the three months ended June 30, 2024, was $976,316, a turnaround from an operating loss of $3,084,512 in the same period of 2023[19] - The company reported a net income of $18,461,995 for the three months ended June 30, 2024, compared to a net loss of $3,103,279 in the same period of 2023[19] Revenue Growth and Pipeline - The total validated pipeline increased to approximately $150 million, including $30 million in new opportunities from a successful pilot for a federal agency[4] - The company anticipates triple-digit revenue growth and positive cash flow for calendar year 2024, supported by a strong pipeline and improving gross profit margins[6] Expenses and Liabilities - Total liabilities increased to $33,271,809 as of June 30, 2024, up from $23,575,140 at the end of 2023, reflecting a rise of approximately 41%[17] - Cash and cash equivalents decreased to $226,750 as of June 30, 2024, from $3,124,413 at the end of 2023, indicating a decline of about 93%[17] - Research and development expenses for the six months ended June 30, 2024, were $1,398,137, slightly higher than $1,339,283 for the same period in 2023[19] - Selling, general, and administrative expenses decreased to $6,162,414 for the six months ended June 30, 2024, down from $5,925,016 in the same period of 2023[19] - The company’s total stockholders' deficit increased to $(27,966,537) as of June 30, 2024, compared to $(17,487,227) at the end of 2023[17] Cash Flow and Financing Activities - Net cash used in operating activities amounted to $(4,146,868) with a decrease of $(737,102) compared to the previous period[21] - Net cash provided by financing activities was $1,240,221, a decrease of $1,419,821 from the previous period[21] - Cash and cash equivalents at the end of the period totaled $226,750, down from $3,124,413 at the beginning of the period[21] - The company recognized a loss from the change in fair value of warrant liability amounting to $5,304,744[21] - The company reported a loss from the change in fair value of earnout liability of $6,607,923[21] - The issuance of common stock for debt conversion was $835,610[21] - The company had a tax payment of $2,410 during the period[21] - The proceeds from convertible promissory notes were $1,984,582[21] - Advances from founders, net, were $800,000, a decrease from $1,100,000 in the previous period[21] - The effect from exchange rate on cash was $8,984[21] Product Development and Partnerships - A new Outpost AI Edge Appliance was announced, featuring an integrated 5G modem for secure data transmission and analytics[5] - Airship AI has onboarded over 25 new law enforcement agencies for its Acropolis software ecosystem, with several in the acquisition or testing phase[5] - The company entered a partnership with T-Mobile U.S. to enhance secure data transmission capabilities for its Outpost AI platform[5] Backlog and Contracts - Backlog as of June 30, 2024, was approximately $2.0 million, expected to be invoiced in the latter half of 2024[3] - The company completed delivery of contracts worth $10.9 million for advanced integrated solutions supporting real-time intelligence operations along U.S. borders[4]

Financial Performance - Net revenues for the three months ended June 30, 2024, increased by $3,631,000 to $6,401,000 compared to $2,770,000 for the same period in 2023, driven by increased product sales [139]. - Gross profit for the three months ended June 30, 2024, increased by 169.3% to $4,506,000 compared to $1,673,000 for the same period in 2023 [139]. - Operating income for the three months ended June 30, 2024, was $976,000, a significant improvement from a loss of $3,084,000 in the same period in 2023, representing a variance of 131.6% [139]. - The company reported a net income of $18,462,000 for the three months ended June 30, 2024, compared to a net loss of $3,103,000 for the same period in 2023, reflecting a variance of 695.0% [139]. - Net revenues for the six months ended June 30, 2024 increased by $11,267,000 to $16,976,000, a 197.4% increase compared to $5,709,000 for the same period in 2023 [143]. - Gross profit for the six months ended June 30, 2024 was $7,134,000, up 187.9% from $2,478,000 in 2023 [144]. - Other income for the three months ended June 30, 2024 was $17,486,000, a significant increase from other expense of $19,000 in 2023 [141]. Expenses - Research and development expenses for the three months ended June 30, 2024, increased by $38,000 to $703,000 compared to $665,000 for the same period in 2023 [140]. - Research and development expenses for the six months ended June 30, 2024 increased by $59,000 to $1,398,000 compared to $1,339,000 in 2023 [144]. - Selling, general and administrative expenses for the six months ended June 30, 2024 increased by $237,000 to $6,162,000 compared to $5,925,000 in 2023 [144]. Liabilities and Cash Position - Total liabilities measured at fair value as of June 30, 2024, amounted to $20,389,999, compared to $8,626,779 as of December 31, 2023 [130]. - Net cash used in operating activities for the six months ended June 30, 2024 was $4,147,000, primarily due to a net loss of $13,502,000 [151]. - As of June 30, 2024, the company had cash of approximately $227,000 and accounts receivable of approximately $3,440,000 [150]. - The accumulated deficit as of June 30, 2024 was $30,979,000, with a working capital deficit of approximately $6,712,000 [150]. Business Developments - The merger with BYTS closed on December 21, 2023, with Airship AI Holdings, Inc. becoming the accounting acquiror under the ticker symbol "AISP" [128]. - The company has begun selling AI-based solutions since late 2022, focusing on transitioning data management and analysis workloads to the edge [134]. - The company plans to modify and develop more advanced performance indicators as it grows and increases its product offerings and customer base [132]. Lease Agreements - The company entered into a lease for 15,567 square feet of office and warehouse space in Redmond, WA, starting October 1, 2023, with a monthly payment of $25,000, expiring on October 31, 2027, and a 3% increase in payment each year thereafter [157]. - A lease extension was made for 3,621 square feet in Moorestown, North Carolina, with a net monthly payment of $6,488, expiring on August 29, 2024 [157]. Accounting Policies - The company does not have any off-balance sheet arrangements that could materially affect its financial condition, revenue, or expenses [158]. - The consolidated financial statements are prepared in accordance with U.S. GAAP, requiring estimates and assumptions that may differ from actual results due to economic uncertainties [159]. - Significant accounting policies have not materially changed from those discussed in the Annual Report for the year ended December 31, 2023 [160].

Financial Performance - First Quarter 2024 net revenues reached $10.6 million, representing 84.5% of the Company's full year revenue in 2023[10] - Gross profits for Q1 2024 were $2.6 million, with a gross margin percentage of 25%[11] - The Company reported an operating loss of $1.4 million for Q1 2024, attributed to increased insurance costs and professional fees related to the merger and Nasdaq listing[11] - For Q1 2024, Airship AI reported a net loss of $31,964,469, compared to a net loss of $1,712,176 in Q1 2023, indicating a significant increase in losses year-over-year[32] - The company achieved gross profit of $2,628,127 in Q1 2024, up from $804,279 in Q1 2023, reflecting a gross profit margin improvement[32] - Operating loss for Q1 2024 was $1,402,533, an improvement from an operating loss of $1,702,171 in Q1 2023, despite higher operating expenses[32] - Airship AI's total operating expenses increased to $4,030,660 in Q1 2024 from $2,506,450 in Q1 2023, driven by higher selling, general, and administrative expenses[32] Contracts and Opportunities - Backlog stood at approximately $3.4 million, with a validated pipeline of around $120 million for AI-driven edge, video, and sensor data management solutions[12] - The Company was awarded a $2.35 million contract by the DOJ for the Outpost AI appliance, enhancing public safety and investigative capabilities[12] - Airship AI aims for triple-digit revenue growth and positive cash flow objectives in 2024, supported by strong orders from DHS and DOJ[13] - The company expects triple-digit revenue growth for the full year 2024, supported by ongoing contract momentum and a robust pipeline of opportunities[26] - Airship AI has secured contracts with U.S. and foreign governments for its AI-driven solutions, highlighting strong demand in the homeland security and law enforcement sectors[26] - Airship AI has been awarded a contract by a Singapore government agency, indicating expansion opportunities in the Asia-Pacific region[27] Cash and Liabilities - Cash and cash equivalents were $1.7 million as of March 31, 2024, down from $3.1 million at the end of 2023[20] - Total liabilities increased to approximately $52.7 million as of March 31, 2024, compared to $23.6 million at the end of 2023[20] - Cash and cash equivalents at the end of Q1 2024 were $1,725,817, down from $3,124,413 at the beginning of the period, reflecting a net decrease of $1,401,835[33] Research and Development - Research and development expenses for Q1 2024 were $695,366, slightly up from $674,080 in Q1 2023, indicating continued investment in innovation[32] Events and Engagements - The Company hosted a customer technology week in April 2024, attracting over 65 attendees from DOJ and DHS, leading to new opportunities[4] - The Company plans to release new Outpost AI product offerings and expand custom trained AI models for edge analytic workflows[13] - The company anticipates increased activity around pilot programs initiated in 2023, following the approval of the 2024 federal budget[28]

Financial Performance - Net revenues for Q1 2024 increased by $7,636,000 to $10,575,000 compared to $2,939,000 in Q1 2023, driven by increased product sales and over $13 million in purchase orders from federal government customers [283]. - Selling, general and administrative expenses rose by $1,503,000 to $3,335,000 in Q1 2024, up from $1,832,000 in Q1 2023, primarily due to increased insurance costs, professional fees related to the merger, and other operating expenses [284]. - The company reported a loss from changes in fair value of warrant liability amounting to $6,847,000 and an earnout liability loss of $21,485,000 for the three months ended March 31, 2024 [285]. Liquidity and Financial Position - The company has a liquidity position that allows it to operate for at least the next twelve months, supported by existing assets, liabilities, and a backlog of orders totaling over $13 million [286]. - As of March 31, 2024, the company had an earnout liability of $26,618,278 and senior secured convertible promissory notes totaling $4,204,743 [279]. - The company has 515,000 private placement warrants and 16,159,112 public warrants outstanding, all exercisable at $11.50 per share [280]. Strategic Focus and Operations - The company is focused on expanding its edge AI-based solutions, with a strategy aimed at transitioning data management to the edge, enhancing efficiency and cost savings for customers [291]. - The company began selling AI-based solutions in late 2022, with a focus on training new models for real-time data extraction at the edge [291]. - The company’s operational strategy includes measuring progress through the sales of edge AI hardware devices and the growth of its analytic capabilities [291]. Lease and Office Operations - The company’s lease for its Moorestown, North Carolina office was extended, with a new monthly payment of $6,488 effective February 29, 2024 [290].

Stock Performance and Market Risks - The last reported sales price of the Common Stock was $6.45, with the exercise price of the Public Warrants being higher than this market price[87]. - The trading market for the Common Stock may be affected by the lack of coverage from securities analysts, which could negatively impact the stock price[85]. - A prolonged decline in the price of Common Stock could adversely affect the company's liquidity and ability to raise capital[105]. - The company cannot predict market price fluctuations for its common stock, which may be affected by factors beyond its control[111]. Corporate Governance and Ownership Structure - The concentration of ownership by executive officers and directors, who control approximately 70.5% of the voting power, may limit stockholder influence on corporate matters[100]. - The concentration of ownership by a limited number of affiliated stockholders may limit interest in the company's securities[109]. - Anti-takeover provisions in the company's certificate of incorporation could impair a takeover attempt[114]. - Special meetings of stockholders can only be called by the board of directors, potentially delaying stockholder actions[115]. - The Court of Chancery of the State of Delaware is designated as the exclusive forum for certain stockholder litigation matters, which could limit stockholders' options[115]. Financial and Tax Considerations - The company has not capitalized any software development costs during the years ended December 31, 2023, and 2022[97]. - The company does not intend to pay any cash dividends in the foreseeable future, with returns on investment expected to come from increases in the fair market value of the capital stock[107]. - The company may face additional tax liabilities due to changes in tax laws, particularly related to research and experimental expenditures[74][75]. Operational Risks - The company is subject to significant costs associated with public company governance and reporting requirements, which may strain resources and distract management[101]. - The company may be subject to litigation risks due to increased visibility from public disclosures, which could divert management resources[82]. - Regulatory developments affecting the industry could impact the company's operations[110]. - The company faces risks related to the realization of risk factors presented in its annual report[109]. - Additions or departures of key personnel may impact the company's performance[109]. - The company's ability to execute its business plan is crucial for maintaining market confidence[111]. Company Classification - The company is classified as a "smaller reporting company" and an "emerging growth company," allowing it to take advantage of certain reporting exemptions[89]. - The company is classified as a "smaller reporting company" and "emerging growth company," which may make its common stock less attractive to investors[112].

Financial Performance - FY 2023 revenue was $12.3 million, with a gross profit of $5.8 million and a gross margin of 47%[24] - Net income for FY 2023 was $16.4 million, primarily due to $23 million in other income from changes in warrant and earnout liabilities[24] - Operating loss for FY 2023 was $6.6 million, mainly due to $2.9 million in stock-based compensation[24] - Total net revenues for the year ended December 31, 2023, were $12,299,584, a decrease of 15.5% from $14,549,141 in 2022[34] - Gross profit for the year was $5,764,317, down 31.5% from $8,421,013 in the previous year[34] - Operating loss increased to $(6,640,365) in 2023, compared to $(2,823,813) in 2022[34] - Net income for 2023 was $16,371,134, a significant improvement from a net loss of $(487,493) in 2022[34] - Basic net income per share for 2023 was $1.20, compared to a loss of $(0.04) per share in 2022[34] Assets and Liabilities - Total assets as of December 31, 2023, were $6,982,575, compared to $3,909,096 in 2022[33] - Total liabilities increased to $23,575,140, up from $12,267,507 in the previous year[33] - The company reported a total stockholders' deficit of $(16,592,565) as of December 31, 2023, compared to $(8,358,411) in 2022[33] Cash Flow and Financing - Cash and cash equivalents stood at $3.1 million as of December 31, 2023[24] - Net cash used in operating activities was $(3,291,333) compared to $(2,902,659) in the previous period, indicating an increase in cash outflow[36] - Net cash provided by financing activities amounted to $6,119,834, up from $1,866,457 in the prior period, reflecting strong financing support[36] - Cash and cash equivalents at the end of the year reached $3,124,413, a significant increase from $298,614 at the beginning of the year[36] - Proceeds from convertible promissory notes were $2,584,582, contributing to the financing activities[36] - The total cash inflow from reverse recapitalization was $2,809,792, enhancing the company's liquidity position[36] Operational Highlights - The company has a validated pipeline of approximately $140 million expected to drive triple-digit revenue growth in FY 2024[3] - Backlog increased to approximately $11.8 million, including orders from the U.S. Department of Homeland Security and Department of Justice[3] - New product launches include turn-key solutions for government customers leveraging the Outpost AI edge appliance[4] - Focus on expanding customer acquisition with U.S. federal and state law enforcement agencies[4] - The company aims to improve sourcing and supply chain management to drive margin expansion[6] Expenses - Research and development expenses were $2,729,492, a decrease of 24.5% from $3,614,814 in 2022[34] - Selling, general and administrative expenses rose to $9,675,190, up 26.8% from $7,630,012 in the prior year[34] Market Activity - The company completed a merger and began trading on Nasdaq under the ticker "AISP" on December 22, 2023[2] Financial Instruments - The company recognized a gain from the change in fair value of earnout liability totaling $(21,976,349), impacting overall financial performance[36] - The company reported a loss from the change in fair value of convertible notes amounting to $240,784, indicating potential volatility in financial instruments[36] - Interest paid during the period was $21,438, slightly higher than $19,950 in the previous period, reflecting increased borrowing costs[36] - The company experienced a decrease in accounts receivable by $(943,152), which may indicate improved cash collection efforts[36] - The effect from exchange rate on cash was $(2,702), showing minor impact from currency fluctuations[36]

Financial Performance - For the three months ended September 30, 2023, the company reported a net loss of approximately $1.5 million, consisting of about $800,000 in operational losses and a noncash loss of approximately $1.0 million from changes in fair value of derivative warrant liabilities [180]. - For the nine months ended September 30, 2023, the company had a net loss of approximately $2.1 million, which included approximately $3.4 million in operational losses and a noncash loss of approximately $2.5 million from changes in fair value of derivative warrant liabilities [181]. - As of September 30, 2023, the company had cash of $18,752 [183]. - The company has no long-term debt or capital lease obligations, but incurs a monthly fee of $10,000 for office space and administrative services [185]. Shareholder Actions - Shareholders holding an aggregate of 525,624 Class A ordinary shares redeemed their shares for approximately $10.63 per share during the extraordinary general meeting on September 22, 2023 [174]. Business Combination Timeline - The company extended the deadline to complete a business combination from September 25, 2023, to December 26, 2023, with a potential further extension to March 25, 2024 [174]. - The company is seeking to complete an initial business combination within the Combination Period to avoid mandatory liquidation [184]. - The Company has a deadline to complete its initial business combination by December 26, 2023, or March 25, 2024, if extended without shareholder approval [204]. - If the initial business combination is not completed within the specified timeframe, the Company may be required to liquidate [204]. Regulatory Considerations - The review process by CFIUS or other U.S. government entities could be lengthy, impacting the completion of the business combination [204]. - The Company has limited time to finalize its initial business combination due to potential government review delays [204]. - If the business combination is ultimately prohibited by CFIUS or another U.S. government entity, it may lead to liquidation [204]. Internal Controls - A material weakness in internal controls over financial reporting was identified, which could result in misstatements of financial statements [202]. Capital Raising - The company completed a private placement of 1,030,000 units at $10.00 per unit, generating total gross proceeds of $10.3 million [172]. - The company has been operating as a blank check company for approximately 29 months since its initial public offering on March 23, 2021 [200].

Financial Performance - The company reported a net loss of approximately $657,000 for the six months ended June 30, 2023, primarily due to $2.5 million in operational losses and a noncash loss of $1.5 million from changes in fair value of derivative warrant liabilities [192]. - For the same period in 2022, the company had a net income of approximately $7.2 million, mainly from a noncash gain of $7.4 million related to derivative warrant liabilities and $455,000 from investments held in the Trust Account [193]. - For the three months ended June 30, 2023, the company reported a net loss of approximately $1.8 million, primarily due to $1.9 million in operational losses and a noncash loss of approximately $334,000 from changes in fair value of derivative warrant liabilities [218]. - For the three months ended June 30, 2022, the company had a net income of approximately $1.9 million, primarily from a noncash gain of approximately $1.8 million [219]. Trust Account and Financing - As of March 16, 2023, shareholders approved an extension for the company to complete its initial business combination until September 25, 2023, with approximately $24.1 million remaining in the Trust Account after redemptions [183]. - The company has placed $323.7 million in a trust account, invested in U.S. government securities, until the completion of a business combination [181]. - The underwriters waived their entitlement to a deferred fee of $11,329,238, which was contingent upon completing a business combination with Airship AI [195]. - The company entered into non-redemption agreements with shareholders, committing to hold or acquire $7 million of Class A ordinary shares in connection with the merger [213]. Merger and Shareholder Agreements - The company entered into a merger agreement with Airship AI Holdings, Inc. on June 27, 2023, which includes a support agreement with the Sponsor [215][216]. - The Sponsor agreed to forfeit 1,000,000 Class A ordinary shares and contribute 2,600,000 shares to secure financing related to the merger [216]. Operational Status and Compliance - The company has not engaged in any operations or generated revenues to date, with expected increased expenses due to public company compliance [191]. - The company expects to incur increased expenses related to legal, financial reporting, and auditing compliance as a public entity [191]. - As of June 30, 2023, the company had cash of $213,892, raising substantial doubt about its ability to continue as a going concern [221][222]. - The company has no long-term debt or significant liabilities, except for a monthly fee of $10,000 to Sagara Group, LLC for office space and administrative services [223]. - As of June 30, 2023, there were 2,363,217 Class A ordinary shares subject to possible redemption, classified as temporary equity [226]. Accounting and Internal Controls - The company adopted ASU 2016-13 on January 1, 2023, which did not impact its financial statements [228]. - The company qualifies as an "emerging growth company" under the JOBS Act, allowing it to delay the adoption of new accounting standards [230]. - There were no changes in internal control over financial reporting that materially affected the company during the fiscal quarter ended June 30, 2023 [234].