0001829126-24-005359 | S-1 | XBRL Viewer

Deferred Revenue (Details) - USD ($) $ in Thousands	3 Months Ended	10 Months Ended	12 Months Ended
Deferred Revenue (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Successor [Member]
Deferred revenue, beginning balance	$ 2,878	$ 2,534
Revenue recognized	(1,818)	(5,746)
Revenue deferred	2,572	6,090
Deferred revenue, ending balance	3,632	2,878
Successor [Member] \| Licensing Agreements [Member]
Deferred revenue, beginning balance	2,404	2,148
Revenue recognized	(1,588)	(4,560)
Revenue deferred	2,406	4,816
Deferred revenue, ending balance	3,222	2,404
Successor [Member] \| Professional Service Agreements [Member]
Deferred revenue, beginning balance	474	386
Revenue recognized	(230)	(1,186)
Revenue deferred	166	1,274
Deferred revenue, ending balance	$ 410	474
Predecessor [Member]
Deferred revenue, beginning balance		$ 2,534	$ 3,146
Revenue recognized			(8,470)
Revenue deferred			7,486
Deferred revenue, ending balance			2,162
Predecessor [Member] \| Licensing Agreements [Member]
Deferred revenue, beginning balance			2,524
Revenue recognized			(5,476)
Revenue deferred			4,883
Deferred revenue, ending balance			1,931
Predecessor [Member] \| Professional Service Agreements [Member]
Deferred revenue, beginning balance			622
Revenue recognized			(2,994)
Revenue deferred			2,603
Deferred revenue, ending balance			$ 231

Leases

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Leases [Abstract]

Leases

NOTE 16 – Leases

The Company has operating leases for administrative offices in Canada, the Philippines, and the United States. The Manila, Philippines office lease expires in May 2025, the Canada lease expires in May 2026, and the United States office lease expires in April 2024. The Company has no other operating or financing leases with terms greater than 12 months.

Lease expense for operating leases recorded on the balance sheet is based on the future minimum lease payments recognized on a straight-line basis over the term of the lease plus any variable lease costs. Operating lease expenses, inclusive of short-term and variable lease expenses, recognized in the Company’s unaudited condensed consolidated statement of operations for the three months ended March 31, 2024 (Successor), for the period from March 15, 2023, to March 31, 2023 (Successor), and for the period from January 1, 2023, to March 14, 2023 (Predecessor) was approximately $113 thousand, $9 thousand, and $57 thousand, respectively.

Operating lease liabilities are based on the net present value of the remaining lease payments over the remaining lease term. In determining the present value of lease payments, the Company used its incremental borrowing rate based on the information available at the date of adoption of ASC 842 “Leases” (“ASC 842”). As of March 31, 2024 (Successor), the weighted average remaining lease term is 1.1 years and the weighted average discount rate used to determine the operating lease liabilities was 8.0%. As of December 31, 2023 (Successor), the weighted average remaining lease term is 1.4 years and the weighted average discount rate used to determine the operating lease liabilities was 8.0%.

Schedule of operating leases Schedule of operating leases
(in thousands)	Operating Leases
Year 2024	$	197
Year 2025		174
Year 2026		59
Total lease payments		430
Less: Imputed interest		(39	)
Present value of lease liabilities	$	391

NOTE 17 – Leases

Lease expense for operating leases recorded on the balance sheet is based on the future minimum lease payments recognized on a straight-line basis over the term of the lease plus any variable lease costs. Operating lease expenses, inclusive of short-term and variable lease expenses, recognized in the Company’s consolidated statement of operations for the period from March 15, 2023, to December 31, 2023 (Successor), for the period from January 1, 2023, to March 14, 2023 (Predecessor), and for the year ended December 31, 2022 (Predecessor) was approximately $345 thousand, $57 thousand, and $681 thousand, respectively.

Operating lease liabilities are based on the net present value of the remaining lease payments over the remaining lease term. In determining the present value of lease payments, the Company used its incremental borrowing rate based on the information available at the date of adoption of ASC 842 “Leases” (“ASC 842”). As of December 31, 2023, the weighted average remaining lease term is 1.4 years and the weighted average discount rate used to determine the operating lease liabilities was 8.0%. As of December 31, 2022, the weighted average remaining lease term is 2.82 years and the weighted average discount rate used to determine the operating lease liabilities was 8.0%.

Schedule of operating leases
(in thousands)	Operating Leases
Year 2024	$	315
Year 2025		177
Year 2026		60
Total lease payments		552
Less: Imputed interest		(47	)
Present value of lease liabilities	$	505

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands	1 Months Ended	2 Months Ended	3 Months Ended	10 Months Ended	12 Months Ended
	Mar. 31, 2023	Mar. 14, 2023	Mar. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Successor [Member]
Operating activities
Net income (loss)	$ 2,758		$ (5,170)	$ (49,238)
Adjustments to reconcile net income (loss) to net cash used in operating activities
Depreciation and amortization	4		22	75
Amortization of intangible assets	116		683	2,162
Amortization of right of use asset	8		104	298
Amortization of debt discount and deferred financing cost			221	37
Accrued interest expense on promissory note			99	16
Deferred income taxes	(1,560)		(207)	(3,570)
Stock-based compensation expense	2		599
(Gain) loss on foreign currency transactions	3		54	(44)
Change in fair value of derivative liability	(1,686)		1,472	4,714
Change in operating assets and liabilities:
Accounts receivable and other receivables	(335)		644	300
Prepaid expenses and other current assets	(100)		(89)	719
Other assets	(37)			(37)
Accounts payable	135		46	499
Accrued liabilities	(3,888)		227	(5,876)
Operating lease liabilities	(7)		(112)	(306)
Deferred revenue	156		757	360
Net cash used in operating activities	(4,431)		(650)	(12,766)
Investing activities
Purchases of property and equipment	(23)		(18)	(57)
Investment in capitalized software
Cash acquired in connection with Business Combination	10,003			10,003
Net cash provided by (used in) investing activities	9,980		(18)	9,946
Financing activities
Net equity investment from parent
Repayment of CXApp acquisition liability
Repayment of related party promissory note	(328)			(328)
Net cash provided by financing activities	(328)			7,620
Effect of exchange rate changes on cash and cash equivalents			(4)	(28)
Net increase in cash and cash equivalents	5,221		(672)	4,772
Cash and cash equivalents, beginning of period	1,503		6,275	1,503
Cash and cash equivalents, end of period	6,724	$ 1,503	5,603	6,275
Supplemental disclosures of cash flow information
Cash paid for taxes				4
Cash paid for interest				18
Supplemental schedule of noncash investing and financing activities
Noncash investment from parent
Class A Common Stock and Class C Common Stock issued in connection with Business Combination	69,928			69,928
Financing of Director and Officer Insurance	537		$ 226	671
Predecessor [Member]
Operating activities
Net income (loss)		(4,380)			$ (29,175)
Adjustments to reconcile net income (loss) to net cash used in operating activities
Depreciation and amortization		228			646
Amortization of intangible assets		806			3,885
Amortization of right of use asset		40			266
Amortization of debt discount and deferred financing cost
Accrued interest expense on promissory note
Deferred income taxes
Stock-based compensation expense		158
(Gain) loss on foreign currency transactions		(32)
Change in fair value of derivative liability
Change in operating assets and liabilities:
Accounts receivable and other receivables		(857)			109
Prepaid expenses and other current assets		(20)			109
Other assets					18
Accounts payable		(796)			400
Accrued liabilities		(787)			1,096
Operating lease liabilities		(38)			(257)
Deferred revenue		534			(932)
Net cash used in operating activities		(5,144)			(18,895)
Investing activities
Purchases of property and equipment		(9)			(88)
Investment in capitalized software		(45)			(394)
Cash acquired in connection with Business Combination
Net cash provided by (used in) investing activities		(54)			(482)
Financing activities
Net equity investment from parent		9,089			25,967
Repayment of CXApp acquisition liability		(197)			(5,135)
Repayment of related party promissory note
Net cash provided by financing activities		8,892			20,728
Effect of exchange rate changes on cash and cash equivalents		1			(71)
Net increase in cash and cash equivalents		3,695			1,280
Cash and cash equivalents, beginning of period	$ 10,003	6,308		$ 10,003	5,028
Cash and cash equivalents, end of period		10,003			6,308
Supplemental disclosures of cash flow information
Cash paid for taxes					119
Cash paid for interest					1
Supplemental schedule of noncash investing and financing activities
Noncash investment from parent		409
Class A Common Stock and Class C Common Stock issued in connection with Business Combination
Financing of Director and Officer Insurance

Software Development Costs, net (Details Narrative) - USD ($) $ in Thousands	1 Months Ended	2 Months Ended	3 Months Ended	10 Months Ended	12 Months Ended
	Mar. 31, 2023	Mar. 14, 2023	Mar. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Predecessor [Member]
Amortization expense		$ 209			$ 527
Successor [Member]
Amortization expense	$ 0		$ 0	$ 0

Cover	3 Months Ended
Cover	Mar. 31, 2024
Entity Addresses [Line Items]
Document Type	S-1
Amendment Flag	false
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2024
Entity Registrant Name	CXApp Inc.
Entity Central Index Key	0001820875
Entity Tax Identification Number	85-2104918
Entity Address, Address Line One	Four Palo Alto Square,
Entity Address, Address Line Two	Suite 200,
Entity Address, Address Line Three	3000 El Camino Real
Entity Address, City or Town	Palo Alto
Entity Address, State or Province	DE
Entity Address, Postal Zip Code	94306
City Area Code	(650)
Local Phone Number	575-4456
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Elected Not To Use the Extended Transition Period	false
Business Contact [Member]
Entity Addresses [Line Items]
Entity Address, Address Line One	Four Palo Alto Square,
Entity Address, Address Line Two	Suite 200,
Entity Address, Address Line Three	3000 El Camino Real
Entity Address, City or Town	Palo Alto
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	94306
City Area Code	(650)
Local Phone Number	575-4456
Contact Personnel Name	Khurram P. Sheikh

Stock Option Plan and Stock-Based Compensation (Details 3) - Successor [Member] - USD ($) $ in Thousands	1 Months Ended	3 Months Ended	10 Months Ended
	Mar. 31, 2024	Mar. 31, 2024	Dec. 31, 2023
Goodwill [Line Items]
Stock-based compensation	$ 2	$ 220	$ 1,080
Research and Development Expense [Member]
Goodwill [Line Items]
Stock-based compensation		3
Selling and Marketing Expense [Member]
Goodwill [Line Items]
Stock-based compensation		32
General and Administrative Expense [Member]
Goodwill [Line Items]
Stock-based compensation	$ 2	185
Restricted Stock Units (RSUs) [Member]
Goodwill [Line Items]
Stock-based compensation		381	$ 686
Restricted Stock Units (RSUs) [Member] \| Research and Development Expense [Member]
Goodwill [Line Items]
Stock-based compensation		98
Restricted Stock Units (RSUs) [Member] \| Selling and Marketing Expense [Member]
Goodwill [Line Items]
Stock-based compensation		51
Restricted Stock Units (RSUs) [Member] \| General and Administrative Expense [Member]
Goodwill [Line Items]
Stock-based compensation		$ 232

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
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Reference 11: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

Accrued Liabilities (Tables)

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Payables and Accruals [Abstract]

Schedule of accrued Liabilities

Schedule of accrued Liabilities
	March 31, 2024		December 31, 2023
Accrued compensation and benefits	$	251	$	387
Accrued bonus and commissions		279		108
Income tax payables		78		74
Accrued insurance premium and interest		225		-
Accrued transaction costs		13		13
Accrued sales and other indirect taxes payable		8		12
Accrued other		821		858
Accrued liabilities	$	1,675	$	1,452

Schedule of accrued Liabilities
	Successor		Predecessor
	December 31, 2023		December 31, 2022
Accrued compensation and benefits	$	387	$	586
Accrued bonus and commissions		108		422
Income tax payables		74		-
Accrued rent		-		559
Accrued transaction costs		13		-
Accrued sales and other indirect taxes payable		12		86
Accrued other		858		83
Accrued liabilities	$	1,452	$	1,736

Software Development Costs, net (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Successor [Member]
Capitalized software development costs
Accumulated amortization
Software development costs, net
Predecessor [Member]
Capitalized software development costs		$ 2,680
Accumulated amortization		(2,193)
Software development costs, net		$ 487

Subsequent Events (Details Narrative)	1 Months Ended
Subsequent Events (Details Narrative)	May 22, 2024
Subsequent Event [Line Items]
Equity line financing agreement description	Company entered into an equity line financing agreement for up to $10,000 thousand, with an initial draw of $2,500 thousand in the second quarter of 2024.
Subsequent Event [Member]
Subsequent Event [Line Items]
Description of equity line financing agreement	the Company entered into an equity line financing agreement for up to $10,000 thousand, with an initial draw of $2,500 thousand in the second quarter of 2024.

Deferred Revenue (Details Narrative) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023	Mar. 14, 2023	Dec. 31, 2022	Dec. 31, 2021
Successor [Member]
Deferred revenue, ending balance	$ 3,632	$ 2,878	$ 2,534
Predecessor [Member]
Deferred revenue, ending balance			$ 2,534	$ 2,162	$ 3,146

Deferred Revenue (Tables)

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Deferred Revenue

Schedule of deferred revenue

Schedule of deferred revenue
	License Agreements			Professional Service Agreements			Total
Deferred Revenue – January 1, 2024	$	2,404		$	474		$	2,878
Revenue recognized		(1,588	)		(230	)		(1,818	)
Revenue deferred		2,406			166			2,572
Deferred Revenue – March 31, 2024	$	3,222		$	410		$	3,632

	License Agreements			Professional Service Agreements			Total
Deferred Revenue – March 15, 2023	$	2,148		$	386		$	2,534
Revenue recognized		(4,560	)		(1,186	)		(5,746	)
Revenue deferred		4,816			1,274			6,090
Deferred Revenue – December 31, 2023	$	2,404		$	474		$	2,878

Schedule of deferred revenue
	Successor
	License Agreements			Professional Service Agreements			Total
Deferred Revenue - March 15, 2023	$	2,148		$	386		$	2,534
Revenue recognized		(4,560	)		(1,186	)		(5,746	)
Revenue deferred		4,816			1,274			6,090
Deferred Revenue - December 31, 2023	$	2,404		$	474		$	2,878

	Predecessor
	License Agreements			Professional Service Agreements			Total
Deferred Revenue - January 1, 2022	$	2,524		$	622		$	3,146
Revenue recognized		(5,476	)		(2,994	)		(8,470	)
Revenue deferred		4,883			2,603			7,486
Deferred Revenue - December 31, 2022	$	1,931		$	231		$	2,162

Promissory Note (Details) - Successor [Member] - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Principal amount	$ 3,885	$ 3,885
Less:	616	834
	11	14
Note payable before accrued interest payable	3,258	3,037
Add:	115	16
Note payable	$ 3,373	$ 3,053

Summary of Significant Accounting Policies

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

NOTE 2 – Summary of Significant Accounting Policies

Liquidity

As of March 31, 2024 (Successor), the Company had a working capital deficiency of approximately $5,280 thousand and cash and cash equivalents of approximately $5,603 thousand. For the three months ended March 31, 2024 (Successor), the Company incurred net loss of approximately $5,170 thousand and used approximately $650 thousand of cash for operating activities.

●

In January 2024, the Company streamlined its operations to conserve cash resources by laying off approximately 20% of the global employee headcount;

●

In February 2024, Google agreed to add the CXAI application platform to the Google Marketplace and signed a go-to-market partnership agreement. Google Cloud’s sales and marketing teams will work with CXAI on targeting key clients and providing them the best workplace platform experience. With this, the Management believes that this partnership would help boost the Company’s product capability revenue; and

●

In March 2024, the Company successfully negotiated for a 50% reduction in D&O insurance premium.

On May 22, 2024, the Company entered into an equity line financing agreement for up to $10,000 thousand, with an initial draw of $2,500 thousand in the second quarter of 2024. The Company also managed to raise $3,000 thousand, in December 2023, under a promissory note payable by December 2024. The Management believes that these funding have the ability to mitigate any going concern indicators for a period of at least one year from the date these financial statements are issued.

The ability of the Company to continue as a going concern is dependent upon the Company’s ability to further implement its business plan. The accompanying unaudited condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the ordinary course of business. The consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of the uncertainties described above.

Basis of Presentation

The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and the requirements of the Securities and Exchange Commission (the “SEC”) for interim reporting. Accordingly, since they are interim statements, they do not include all of the information and disclosures required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three months ended March 31, 2024 are not necessarily indicative of the results that may be expected for other quarters or the year ending December 31, 2024. The condensed consolidated balance sheet as of December 31, 2023, has been derived from the audited financial statements as of that date. For more complete financial information, these condensed consolidated financial statements and the notes thereto should be read in conjunction with the audited financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2023, which was filed with the SEC on May 23, 2024.

Principles of Consolidation

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

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during each of the reporting periods. Actual results could differ from those estimates. The Company’s significant estimates consist of:

●

the valuation of stock-based compensation;

●

the valuation of warrant liabilities;

●

the allowance for credit losses;

●

the valuation allowance for deferred tax assets; and

●

impairment of long-lived assets and goodwill.

Cash and Cash Equivalents

Cash and cash equivalents consist of cash, checking accounts, money market accounts, temporary investments and certificates of deposit with maturities of three months or less when purchased. As of March 31, 2024 (Successor), the Company had cash equivalents of approximately $4,916 thousand of certificates of deposit held by a number of banks limited to $250 thousand per bank with a duration of 90 days or less. As of December 31, 2023 (Successor), the Company had $5,584 cash equivalents.

Accounts Receivable, net and Allowance for Credit Losses

Accounts receivables are stated at the amount the Company expects to collect. The Company recognizes an allowance for credit losses to ensure accounts receivables are not overstated due to uncollectability. Allowance for credit losses are maintained for various customers based on a variety of factors, including the length of time the receivables are past due, significant one-time events and historical experience. An additional reserve for individual accounts is recorded when the Company becomes aware of a customer’s inability to meet its financial obligation, such as in the case of bankruptcy filings, or deterioration in such customer’s operating results or financial position. If circumstances related to a customer change, estimates of the recoverability of receivables would be further adjusted. The Company’s allowance for credit losses is approximately $2 thousand as of March 31, 2024 (Successor) and December 31, 2023 (Successor).

Property and Equipment, net

Property and equipment are recorded at cost, less accumulated depreciation and amortization. The Company depreciates its property and equipment for financial reporting purposes using the straight-line method over the estimated useful lives of the assets, which range from 5 to 10 years. Leasehold improvements are amortized over the lesser of the useful life of the asset or the initial lease term. Expenditures for maintenance and repairs, which do not extend the economic useful life of the related assets, are charged to operations as incurred, and expenditures, which extend the economic life, are capitalized. When assets are retired, or otherwise disposed of, the costs and related accumulated depreciation or amortization are removed from the accounts and any gain or loss on disposal is recognized.

Intangible Assets, net

Intangible assets primarily consist of developed technology, customer lists/relationships, intellectual property agreements, export licenses and trade names/trademarks. They are amortized ratably over a range of 5 to 10 years, which approximates customer attrition rate and technology obsolescence. The Company assesses the carrying value of its intangible assets for impairment annually, or more frequently if an event or other circumstances indicates that the Company may not be able to recover the carrying amount of the assets. Based on its assessments, the Company did not incur any impairment charges for the for the three months ended March 31, 2024 (Successor), for the period from March 15, 2023, to March 31, 2023 (Successor), and for the period from January 1, 2023, to March 14, 2023 (Predecessor).

Goodwill

The Company tests goodwill for potential impairment at least annually, or more frequently if an event or other circumstance indicates that the Company may not be able to recover the carrying amount of the net assets of the reporting unit. The Company has determined that the reporting unit is the entire company, due to the integration of all of the Company’s activities. In evaluating goodwill for impairment, the Company may assess qualitative factors to determine whether it is more likely than not (that is, a likelihood of more than 50%) that the fair value of a reporting unit is less than its carrying amount. If the Company bypasses the qualitative assessment, or if the Company concludes that it is more likely than not that the fair value of a reporting unit is less than its carrying value, then the Company performs a quantitative impairment test by comparing the fair value of a reporting unit with its carrying amount.

The Company calculates the estimated fair value of a reporting unit using a weighting of the income and market approaches. For the income approach, the Company uses internally developed discounted cash flow models that include the following assumptions, among others: projections of revenues, expenses, and related cash flows based on assumed long-term growth rates and demand trends; expected future investments to grow new units; and estimated discount rates. For the market approach, the Company uses internal analyses based primarily on market comparables, including public company method, guideline transaction method, and market price method. The Company bases these assumptions on its historical data and experience, third-party appraisals, industry projections, micro and macro general economic condition projections, and its expectations. Based on its assessments, the Company did not incur any impairment charges for the three months ended March 31, 2024 (Successor), for the period from March 15, 2023, to March 31, 2023 (Successor), and for the period from January 1, 2023, to March 14, 2023 (Predecessor).

Leases and Right-of-Use Assets and Liabilities

The Company determines if an arrangement is a lease at its inception. Operating lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. The Company generally uses their incremental borrowing rate based on the information available at the lease commencement date in determining the present value of future payments, because the implicit rate of the lease is generally not known. Right-of-use assets related to the Company’s operating lease liabilities are measured at lease inception based on the initial measurement of the lease liability, plus any prepaid lease payments and less any lease incentives. The Company’s lease terms that are used in determining their operating lease liabilities at lease inception may include options to extend or terminate the leases when it is reasonably certain that the Company will exercise such options. The Company amortizes their right-of-use assets as operating lease expense generally on a straight-line basis over the lease term and classify both the lease amortization and imputed interest as operating expenses. The Company does not recognize lease assets and lease liabilities for any lease with an original lease term of less than one year.

Income Taxes

The Company accounts for income taxes using the asset and liability method. Accordingly, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in the tax rate is recognized in income or expense in the period that the change is effective. Income tax benefits are recognized when it is probable that the deduction will be sustained. A valuation allowance is established when it is more likely than not that all or a portion of a deferred tax asset will either expire before the Company is able to realize the benefit, or that future deductibility is uncertain.

Comprehensive Income (Loss) and Foreign Currency Translation

The Company reports comprehensive income (loss) and its components in its condensed consolidated financial statements. Comprehensive loss consists of net loss and foreign currency translation adjustments, affecting stockholders’ equity that, under GAAP, are excluded from net loss.

Assets and liabilities related to the Company’s foreign operations are calculated using the Philippine Peso and Canadian Dollar, and are translated at end-of-period exchange rates, while the related revenues and expenses are translated at average exchange rates prevailing during the period. Gains or losses resulting from transactions denominated in foreign currencies are included in general and administrative expenses in the condensed consolidated statements of operations. The Company engages in foreign currency denominated transactions with customers that operate in functional currencies other than the U.S. dollar. Aggregate foreign currency net transaction gain were approximately $54 thousand, $0 thousand, and loss of $28 thousand for the three months ended March 31, 2024 (Successor), for the period from March 15, 2023, to March 31, 2023 (Successor), and for the period from January 1, 2023, to March 14, 2023 (Predecessor).

Debt Issuance Costs

The costs related to the issuance of debt are capitalized and amortized to interest expense over the life of the related debt using the effective interest method. The amendments to FASB ASC 835-30 require that debt issuance costs be presented in the Condensed Consolidated Balance Sheets as a direct deduction from the carrying amount of long-term debt, consistent with debt discounts or premiums.

Revenue Recognition

The Company recognizes revenue, in accordance with ASC 606, when control is transferred of the promised products or services to its customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those products or services. The Company derives revenue from its software as a service for cloud-based software, as well as design, implementation and other professional services for work performed in conjunction with its cloud-based software. The Company enters into contracts with its customers whereby it grants a non-exclusive cloud-based license for the use of its proprietary software and for professional services. The contracts may also provide for on-going services for a specified price, which may include maintenance services, designated support, and enhancements, upgrades and improvements to the software, depending on the contract. Licenses for cloud software provide the customer with a right to use the software as it exists when made available to the customer. All software provides customers with the same functionality and differs mainly in the duration over which the customer benefits from the software.

The Company recognizes revenue in accordance with ASC 606 – Revenue from Contracts with Customers. The standard’s core principle is that an entity will recognize revenue when it transfers goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. The new standard is a principles-based standard intended to better match the accounting for the transaction with the economics of the transaction. This requires entities to use more judgment and make more estimates than under previous revenue standards.

The standard introduces a five-step model for revenue recognition that replaces the four criteria for revenue recognition under previous GAAP. The five steps are shown below:

Identify the contract with a customer;

Identify the performance obligations in the contract;

Determine the transaction price;

Allocate the transaction price to performance obligations; and

Recognize revenue when (or as) the entity satisfies a performance obligation.

License Subscription Revenue Recognition (Software As A Service)

With respect to sales of the Company’s license agreements, customers generally pay fixed annual fees in advance in exchange for the Company’s software service provided via electronic means, which are generally recognized ratably over the license term. Some agreements allow the customer to terminate their subscription contracts before the end of the applicable term, and in such cases the customer is generally entitled to a refund pro rata but only for the elapsed time remaining at the point of termination, which would approximate the deferred revenue at such time. The Company’s performance obligation is satisfied over time as the electronic services are provided continuously throughout the service period. The Company recognizes revenue evenly over the service period using a time-based measure because the Company is providing continuous access to its service. The Company’s customers generally pay within 30 to 60 days from the receipt of a customer approved invoice.

The timing of the Company’s revenue recognition related to the licensing revenue stream is dependent on whether the software licensing agreement entered into represents a service. Software that relies on an entity’s IP and is delivered only through a hosting arrangement, where the customer cannot take possession of the software, is a service. Customers may purchase perpetual licenses or subscribe to licenses, which provide customers with the same functionality and differ mainly in the duration over which the customer benefits from the software.

Renewals or extensions of licenses are evaluated as distinct licenses and revenue attributed to the distinct service is not recognized until: (1) the entity provides the distinct license (or makes the license available) to the customer and (2) the customer is able to use and benefit from the distinct license. Renewal contracts are not combined with original contracts, and, as a result, the renewal right is evaluated in the same manner as all other additional rights granted after the initial contract. The revenue is not recognized until the customer can begin to use and benefit from the license, which is typically at the beginning of the license renewal period. The Company recognizes revenue resulting from renewal of licensed software over time.

Professional Services Revenue Recognition

The Company provides integration and software customization professional services to its customers.

Professional services under milestone contracts are accounted for using the percentage of completion method. As soon as the outcome of a contract can be estimated reliably, contract revenue is recognized in the statement of operations in proportion to the stage of completion of the contract. Contract costs are expensed as incurred. Contract costs include all amounts that relate directly to the specific contract, are attributable to contract activity, and are specifically chargeable to the customer under the terms of the contract.

Professional services are also contracted on the fixed fee and in some cases on a time and materials basis. Fixed fees are paid monthly, in phases, or upon acceptance of deliverables. The Company’s time and materials contracts are paid weekly or monthly based on hours worked. Revenue on time and material contracts is recognized based on a fixed hourly rate as direct labor hours are expended. Materials, or other specified direct costs, are reimbursed as actual costs and may include markup. The Company has elected the practical expedient to recognize revenue for the right to invoice because the Company’s right to consideration corresponds directly with the value to the customer of the performance completed to date. For fixed fee contracts provided by in house personnel, the Company recognizes revenue evenly over the service period using a time-based measure because the Company is providing continuous service. Because the Company’s contracts have an expected duration of one year or less, the Company has elected the practical expedient in ASC 606-10-50-14(a) to not disclose information about its remaining performance obligations. Anticipated losses are recognized as soon as they become known. For the three months ended March 31, 2024 (Successor), for the period from March 15, 2023, to March 31, 2023 (Successor), and for the period from January 1, 2023, to March 14, 2023 (Predecessor), the Company did not incur any such losses. These amounts are based on known and estimated factors.

Contract Balances

The timing of the Company’s revenue recognition may differ from the timing of invoicing to and payment by its customers. The Company records an unbilled receivable when revenue is recognized prior to invoicing and the Company has an unconditional right to payment. Alternatively, when invoicing a customer precedes the Company providing of the related services, the Company records deferred revenue until the performance obligations are satisfied. The Company had deferred revenue of approximately $3,632 thousand and $2,878 thousand as of March 31, 2024 (Successor) and December 31, 2023 (Successor), respectively, related to customer invoices rendered in advance for software licenses and professional services provided by the Company’s technical staff. The Company expects to satisfy its remaining performance obligations for the deferred revenue associated with professional services, and recognize the deferred revenue related to licenses generally over the remaining contract term which is generally twelve months following the commencement of the license. The Company recognized revenue in the reporting period of $1,030 thousand, $170 thousand, and $865 thousand, that was included in the contract liability balance at the beginning of the period, for the three months ended March 31, 2024 (Successor), for the period from March 15, 2023, to March 31, 2023 (Successor), and for the period from January 1, 2023, to March 14, 2023 (Predecessor), respectively.

Costs to Obtain a Contract

The Company recognizes eligible sales commissions as an asset within prepaid expenses and other current assets as the commissions are an incremental cost of obtaining a contract with the customer and the Company expects to recover these costs. The capitalized costs are amortized over the expected contract term.

Cost to Fulfill a Contract

The Company incurs costs to fulfill their obligations under a contract once it has obtained the contract. These costs are generally not significant and are recorded to expense as incurred.

Multiple Performance Obligations

The Company enters into contracts with customers for its technology that include multiple performance obligations. Each distinct performance obligation was determined by whether the customer could benefit from the good or service on its own or together with readily available resources. The Company allocates revenue to each performance obligation based on its relative standalone selling price. The Company’s process for determining standalone selling price considers multiple factors including the Company’s internal pricing model and market trends that may vary depending upon the facts and circumstances related to each performance obligation.

Sales and Use Taxes

The Company presents transactional taxes such as sales and use tax collected from customers and remitted to government authorities on a net basis.

Shipping and Handling Costs

Shipping and handling costs are expensed as incurred as part of cost of revenues. These costs were deemed to be de minimis during each of the reporting periods.

Research and Development

Research and development (“R&D”) costs are expensed when incurred. R&D expenses consist primarily of personnel and related headcount costs, costs of professional services associated with the ongoing development of the Company’s technology, and allocated overhead.

Business Combinations

The Company accounts for business combinations under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 805 “Business Combinations” using the acquisition method of accounting, and accordingly, the assets and liabilities of the acquired business are recorded at their fair values at the date of acquisition. The excess of the purchase price over the estimated fair value is recorded as goodwill. All acquisition costs are expensed as incurred. Upon acquisition, the accounts and results of operations are included as of and subsequent to the acquisition date.

Segments

The Company and its Chief Executive Officer (“CEO”), acting as the Chief Operating Decision Maker (“CODM”) determines its reporting units in accordance with FASB ASC 280, “Segment Reporting” (“ASC 280”). The Company evaluates a reporting unit by first identifying its operating segments under ASC 280. The Company then evaluates each operating segment to determine if it includes one or more components that constitute a business. If there are components within an operating segment that meet the definition of a business, the Company evaluates those components to determine if they must be aggregated into one or more reporting units. If applicable, when determining if it is appropriate to aggregate different operating segments, the Company determines if the segments are economically similar and, if so, the operating segments are aggregated. The Company has one operating segment and reporting unit. The Company is organized and operated as one business. Management reviews its business as a single operating segment, using financial and other information rendered meaningful only by the fact that such information is presented and reviewed in the aggregate.

Stock-Based Compensation

The Company measures the cost of employee and non-employee services received in exchange for an award of equity instruments based on the grant date fair value of the award. The Company has issued stock-based compensation awards in the form of options and restricted stock units. Fair value for options and restricted stock units are valued using the closing price of the common stock on the date of grant. The grant date fair value is recognized over the requisite service period during which an employee and non-employee is required to provide service in exchange for the award.

The grant date fair value of options is estimated using the Black-Scholes option pricing model based on the average of the high and low stock prices at the grant date for awards under the CXApp Inc. 2023 Equity Incentive Plan (the “Incentive Plan”). The risk-free interest rate assumptions were based upon the observed interest rates appropriate for the expected term of the equity instruments. The expected dividend yield is assumed to be zero as the Company has not paid any dividends since its inception and does not anticipate paying dividends in the foreseeable future. The Company uses the simplified method to estimate the expected term.

The Company estimates forfeitures at the time of grant and revises these estimates in subsequent periods if actual forfeitures differ from those estimates.

Derivative Warrant Liabilities

The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in FASB ASC 480, “Distinguishing Liabilities from Equity” (“ASC 480”) and ASC 815, “Derivatives and Hedging” (“ASC 815”). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own common stock, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding. The Company currently has two sets of warrants outstanding, known as the private placement warrants and the public warrants, which are both classified as a liability.

For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of additional paid-in capital at the time of issuance or modification. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded at their initial fair value on the date of issuance as a warrant liability, and adjusted to the then fair value in each balance sheet date thereafter. Changes in the estimated fair value of the warrants are recognized as a non-cash gain or loss on the condensed consolidated statements of operations and amounted to a loss of $1,472 thousand, a gain of $1,686 thousand, and $0 for the three months ended March 31, 2024 (Successor), period from March 15, 2023, to March 31, 2023 (Successor), and period from January 1, 2023, to March 14, 2023 (Predecessor), respectively.

The Company utilized the public warrant quoted market price as the fair value of the warrants as of each relevant date.

Earnings Per Share

The Company computes basic and diluted earnings per share by dividing net income by the weighted average number of common shares outstanding during the period. Diluted earnings per share are similarly calculated with the inclusion of dilutive common stock equivalents. For the three months ended March 31, 2024 (Successor) and for the period from March 15, 2023, to March 31, 2023 (Successor) basic and dilutive net income (loss) per common share were the same since the inclusion of common shares issuable pursuant to the exercise of options, warrants, and vesting of restricted units in the calculation of diluted net income (loss) per common shares would have been anti-dilutive. For the period from March 15, 2023, to March 31, 2023 (Successor), the common shares issuable were excluded from the calculation because (i) the warrants were below their exercise price and (ii) the stock options were not vested.

The following table summarizes the number of common shares and common share equivalents excluded from the calculation of diluted net loss per common share for the three months ended March 31, 2024 (Successor) and net income for the period from March 15, 2023, to March 31, 2023 (Successor).

Schedule of antidilutive shares
(in thousands)	Three Months Ended March 31, 2024		Period from March 15, 2023, to March 31, 2023
Stock options		1,689,900		1,377,000
Restricted stock units		533,165		-
Warrants		21,032,000		24,080,000
Total		23,255,065		25,457,000

Fair Value Measurements

FASB ASC 820, “Fair Value Measurements” (“ASC 820”), provides guidance on the development and disclosure of fair value measurements. The Company follows this authoritative guidance for fair value measurements, which defines fair value, establishes a framework for measuring fair value under generally accepted accounting principles in the United States, and expands disclosures about fair value measurements. The guidance requires fair value measurements be classified and disclosed in one of the following three categories:

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Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities.

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Level 2: Observable prices that are based on inputs not quoted on active markets but corroborated by market data.

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Level 3: Unobservable inputs which are supported by little or no market activity and values determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant judgment or estimation.

Fair value measurements discussed herein are based upon certain market assumptions and pertinent information available to management. The fair value of the warrants has been measured based on the listed market price of such warrants, a Level 1 measurement. For the three months ended March 31, 2024 and period ended March 31, 2023, the Company recognized, in the consolidated statements of operations and comprehensive income, an unrealized loss of $1,472 thousand, an unrealized gain of $1,686 thousand, and $0 for the three months ended March 31, 2024 (Successor), period from March 15, 2023, to March 31, 2023 (Successor), and period from January 1, 2023, to March 14, 2023 (Predecessor), respectively. See Note 11.

The Company accounts for its public and private warrants as a derivative liability initially measured at Its fair values and remeasured in the condensed consolidated statements of operations at the end of each reporting period. When the warrants are exercised, the corresponding derivative liability is de-recognized at the underlying fair value of the Class A common stock that is issued to the warrant holder less any cash paid in accordance with the warrant agreement. Upon either cash or cashless exercise, the de-recognized derivative liability results in an increase in additional paid in capital equal to the difference between the fair value of the underlying Class A common stock and its par value. A cashless exercise results in the warrant holder surrendering Class A common stock equal to the stated warrant exercise price based on the contractual terms in the warrant agreement that governs the cashless conversion.

The following table shows the changes in fair value of the liabilities:


Warrant liability – January 1, 2024	$	1,683
Change in FV of derivative instruments		1,472
Warrant liability – March 31, 2024	$	3,155

Warrant liability – March 15, 2023	$	2,649
Change in FV of derivative instruments		(1,686	)
Warrant liability – March 31, 2023	$	963

Fair Value of Financial Instruments

Financial instruments consist of cash and cash equivalents, accounts receivable, unbilled and other receivables and accounts payable. The Company determines the estimated fair value of such financial instruments presented in these financial statements using available market information and appropriate methodologies.

Carrying Value, Recoverability and Impairment of Long-Lived Assets

The Company follows FASB ASC 360 “Property, Plant, and Equipment” (“ASC 360”) for its long-lived assets. Pursuant to ASC 360-10-35-17, an impairment loss shall be recognized only if the carrying amount of a long-lived asset (asset group) is not recoverable and exceeds its fair value. The carrying amount of a long-lived asset (asset group) is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset (asset group). That assessment shall be based on the carrying amount of the asset (asset group) at the date it is tested for recoverability. An impairment loss shall be measured as the amount by which the carrying amount of a long-lived asset (asset group) exceeds its fair value. Pursuant to ASC 360-10-35-20 if an impairment loss is recognized, the adjusted carrying amount of a long-lived asset shall be its new cost basis. For a depreciable long-lived asset, the new cost basis shall be depreciated (amortized) over the remaining useful life of that asset. Restoration of a previously recognized impairment loss is prohibited.

Pursuant to ASC 360-10-35-21, the Company’s long-lived asset (asset group) is tested for recoverability whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. The Company considers the following to be some examples of such events or changes in circumstances that may trigger an impairment review: (a) significant decrease in the market price of a long-lived asset (asset group); (b) a significant adverse change in the extent or manner in which a long-lived asset (asset group) is being used or in its physical condition; (c) a significant adverse change in legal factors or in the business climate that could affect the value of a long-lived asset (asset group), including an adverse action or assessment by a regulator; (d) an accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of a long-lived asset (asset group); (e) a current-period operating or cash flow loss combined with a history of operating or cash flow losses or a projection or forecast that demonstrates continuing losses associated with the use of a long-lived asset (asset group); and (f) a current expectation that, more likely than not, a long-lived asset (asset group) will be sold or otherwise disposed of significantly before the end of its previously estimated useful life. The Company tests its long-lived assets for potential impairment indicators at least annually and more frequently upon the occurrence of such events.

Based on its assessments, the Company recorded no impairment charges on long-lived assets for the three months ended March 31, 2024 (Successor), for the period from March 15, 2023, to March 31, 2023 (Successor), and for the period from January 1, 2023, to March 14, 2023 (Predecessor).

Recently Issued Accounting Standards Not Yet Adopted

In October 2023, the FASB issued ASU 2023-06 “Disclosure Improvements,” which amends the codification in response to the SEC’s Disclosure Update and Simplification Initiative. The effective date of this update is for fiscal years beginning after June 30, 2027, including interim periods within those fiscal years. The Company is currently assessing potential impact of ASU 2023-06 and does not expect the adoption of this guidance will have a material impact on its condensed consolidated financial statements and disclosures.

In the fourth quarter of 2023, the FASB issued three ASU’s: No. 2023-07 “Segment Reporting (Topic 280),” No. 2023-08 “Intangibles—Goodwill and Other—Crypto Assets (Subtopic 350-60)” and No. 2023-09 “Income Taxes (Topic 740).” The Management sees the Company as one single unit, instead of as segments, leading to a more in-depth consideration should FASB ASU No. 2023-07 be considered. FASB ASU No. 2023-07 is effective after fiscal year ended December 15, 2023. The effects of ASU 2023-08 and ASU 2023-09 are both being considered and assessed for their potential effects, but the Company does not expect any material impact on the financial statements and disclosures. Both FASB ASU 2023-08 and 2023-09 are effective after fiscal year ended December 15, 2024.

In March 2024, the FASB issued ASU 2024-01, “Compensation—Stock Compensation (Topic 718): Scope Application of Profits Interest and Similar Awards,” which clarifies how an entity determines whether a profits interest or similar award is within the scope of Topic 718, or is not a share-based payment arrangement and therefore within the scope of other guidance. ASU 2024-01 adds an example with multiple fact patterns and illustrates how an entity evaluates common terms and characteristics of profits interests and similar awards to reach a conclusion about whether an award meets the conditions in Topic 718. It also amends certain language in the “Scope” and “Scope Exceptions” sections of Topic 718 to improve its clarity and operability without changing the guidance. ASU 2024-01 is effective for the Company for fiscal years beginning after December 15, 2024, and interim periods within those fiscal years. Entities may apply the guidance either retrospectively to all periods presented in the financial statements or prospectively to profits interest and similar awards granted or modified on or after the date of adoption. We are currently evaluating the impact of this standard on our consolidated financial statements.

In March 2024, the FASB issued ASU 2024-02 “Codification Improvements—Amendments to Remove References to the Concept Statements,” which amends the Codification to remove references to various FASB Concepts Statements and impacts a variety of Topics in the Codification. The amendments apply to all reporting entities within the scope of the affected accounting guidance, but in most instances the references removed are extraneous and are not required to understand or apply the guidance. Generally, the amendments in ASU 2024-02 are not intended to result in significant accounting changes for most entities. ASU 2024-02 is effective for the Company for fiscal years beginning after December 15, 2024, and interim periods within those fiscal years. Entities may apply the guidance either retrospectively to the beginning of the earliest comparative period presented or prospectively to all new or modified transactions recognized on or after the date of adoption. We are currently evaluating the impact of this standard on our consolidated financial statements.

NOTE 2 – Summary of Significant Accounting Policies

Liquidity

As of December 31, 2023 (Successor), the Company had a working capital deficit of approximately $1,287 thousand and cash and cash equivalents of approximately $6,275 thousand. For the period from March 15, 2023, to December 31, 2023 (Successor), the Company incurred $49,238 thousand of net loss. For the period from March 15, 2023, to December 31, 2023 (Successor), the Company used approximately $12,766 thousand of cash for operating activities, of which $5,876 thousand was from a reduction in accrued liabilities, primarily paying merger related transaction liabilities.

The Company cannot assure that it will ever earn revenues sufficient to support their operations, or that it will ever achieve profitable operations. The Company’s recurring losses and utilization of cash in its operations are indicators of substantial doubt that the entity can continue as a going concern however, with the Company’s current liquidity position, the Company has taken steps to reduce operating expenses resulting in a more efficient cost structure. The Company discussed plans to finance its future working capital requirements and capital expenditures from cash generated from operating activities, cash raised under the equity line financing agreement for up to $10,000 thousand, with an initial draw of $2,500 thousand in the second quarter of 2024, and cash raised under the promissory note of $3,000 thousand dollars payable by December 2024. Management believes that these actions, when implemented, will result in operational efficiencies, cost savings to the company, and access to funds when and if needed. While the Company believes in the viability of its strategy to generate revenues and in its ability to raise additional funds, there can be no assurances to that effect for the twelve months from the issuance of these consolidated financial statements. The ability of the Company to continue as a going concern is dependent upon the Company’s ability to further implement its business plan. The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the ordinary course of business. The consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of the uncertainties described above.

Use of Estimates

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the valuation of stock-based compensation;

●

the valuation of warrant liabilities;

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the allowance for credit losses;

●

the valuation allowance for deferred tax assets; and

●

impairment of long-lived assets and goodwill.

Basis of Presentation

The accompanying consolidated financial statements are presented in U.S. dollars and have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) and pursuant to the accounting and disclosure rules and regulations of the Securities and Exchange Commission (the “SEC”).

Principles of Consolidation

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

Emerging Growth Company

The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.

Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s consolidated financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.

Cash and Cash Equivalents

Cash and cash equivalents consist of cash, checking accounts, money market accounts, temporary investments and certificates of deposit with maturities of three months or less when purchased. As of December 31, 2023 (Successor), the Company had cash equivalents of approximately $5,584 thousand of certificates of deposit held by a number of banks limited to $250 thousand per bank with a duration of 90 days or less. As of December 31, 2022 (Predecessor), the Company had no cash equivalents.

Accounts Receivable, net and Allowance for Credit Losses

Accounts receivables are stated at the amount the Company expects to collect. The Company recognizes an allowance for credit loss to ensure accounts receivable are not overstated due to uncollectability. Allowance for credit losses is maintained for various customers based on a variety of factors, including the length of time the receivables are past due, significant one-time events and historical experience. An additional allowance for credit losses is recorded for individual accounts when the Company becomes aware of a customer’s inability to meet its financial obligation, such as in the case of bankruptcy filings, or deterioration in such customer’s operating results or financial position. If circumstances related to a customer change, estimates of the recoverability of receivables would be further adjusted.

The Company adopted ASU 2016-13 in the first quarter of fiscal 2023, March 31, 2023, and the impact of the adoption was not material. The allowance for credit losses as of December 31, 2023 (Successor) is approximately $2 thousand.

Property and Equipment, net

Intangible Assets

Intangible assets primarily consist of developed technology, customer lists/relationships, non-compete agreements, intellectual property agreements, export licenses and trade names/trademarks. They are amortized ratably over a range of 5 to 10 years, which approximates customer attrition rate and technology obsolescence. The Company assesses the carrying value of its intangible assets for impairment annually, or more frequently if an event or other circumstances indicates that the Company may not be able to recover the carrying amount of the assets. Based on its assessments, the Company did not incur any impairment charges for the period from March 15, 2023, to December 31, 2023 (Successor), for the period from January 1, 2023, to March 14, 2023 (Predecessor), or for the year ended December 31, 2022 (Predecessor).

Goodwill

The determination of whether goodwill is impaired involves a significant level of judgment in these assumptions, and changes in our forecasts, business strategy, government regulations, or economic or market conditions could significantly impact these judgments, potentially decreasing the fair value of our reporting unit. Any resulting impairment charges could have a material impact on our results of operations.

The Company calculates the estimated fair value of a reporting unit using a weighting of the income and market approaches. For the income approach, the Company uses internally developed discounted cash flow models that include the following assumptions, among others: projections of revenues, expenses, and related cash flows based on assumed long-term growth rates and demand trends; expected future investments to grow new units; and estimated discount rates. For the market approach, the Company uses internal analyses based primarily on market comparables. The Company bases these assumptions on its historical data and experience, third-party appraisals, industry projections, micro and macro general economic condition projections, and its expectations. Based on its assessments, the Company incurred an impairment charge of $36,056 thousand for the period from March 15, 2023, to December 31, 2023 (Successor) and did not incur impairment for the period from January 1, 2023, to March 14, 2023 (Predecessor). The Company incurred an impairment charge of approximately $5,540 thousand for the year ended December 31, 2022 (Predecessor).

Leases and Right-of-Use Assets and Liabilities

Income Taxes

The Company accounts for income taxes using the asset and liability method. Accordingly, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in the tax rate is recognized in income or expense in the period that the change is effective. Income tax benefits are recognized when it is probable that the deduction will be sustained. A valuation allowance is established when it is more likely than not that all or a portion of a deferred tax asset will either expire before the Company is able to realize the benefit, or that future deductibility is uncertain.

Comprehensive Income (Loss) and Foreign Currency Translation

The Company reports comprehensive income (loss) and its components in its consolidated financial statements. Comprehensive loss consists of net loss and foreign currency translation adjustments, affecting stockholders’ equity that, under GAAP, are excluded from net loss.

Assets and liabilities related to the Company’s foreign operations are calculated using the Philippine Peso and Canadian Dollar, and are translated at end-of period exchange rates, while the related revenues and expenses are translated at average exchange rates prevailing during the period. Gains or losses resulting from transactions denominated in foreign currencies are included in other income (expense) in the consolidated statements of operations. The Company engages in foreign currency denominated transactions with customers that operate in functional currencies other than the U.S. dollar. Aggregate foreign currency net transaction losses were not material for the period from March 15, 2023, to December 31, 2023 (Successor), for the period from January 1, 2023, to March 14, 2023 (Predecessor), and for the year ended December 31, 2022 (Predecessor).

Debt Issuance Cost

The costs related to the issuance of debt are capitalized and amortized to interest expense over the life of the related debt using the effective interest method. The amendments to FASB ASC 835-30 require that debt issuance costs be presented in the Consolidated Balance Sheet as a direct deduction from the carrying amount of debt, consistent with debt discounts or premiums.

Revenue Recognition

The Company recognizes revenue, in accordance with ASC 606, when control is transferred of the promised products or services to its customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those products or services. The Company derives revenue from its software as a service for cloud based software, as well as design, implementation and other professional services for work performed in conjunction with its cloud based software. The Company enters into contracts with its customers whereby it grants a non-exclusive cloud-based license for the use of its proprietary software and for professional services. The contracts may also provide for on-going services for a specified price, which may include maintenance services, designated support, and enhancements, upgrades and improvements to the software, depending on the contract. Licenses for cloud software provide the customer with a right to use the software as it exists when made available to the customer. All software provides customers with the same functionality and differs mainly in the duration over which the customer benefits from the software.

CXApp has done an analysis of its revenue recognition process and found that the same steps taken by the Company agrees with ASC 606 – Revenue from Contracts with Customers. The standard’s core principle is that an entity will recognize revenue when it transfers goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. The new standard is a principles-based standard intended to better match the accounting for the transaction with the economics of the transaction. This requires entities to use more judgment and make more estimates than under previous revenue standards.

The standard introduces a five-step model for revenue recognition that replaces the four criteria for revenue recognition under previous GAAP. The five steps are shown below:

Identify the contract with a customer,

Identify the performance obligations in the contract,

Determine the transaction price,

Allocate the transaction price to performance obligations, and

Recognize revenue when (or as) the entity satisfies a performance obligation.

License Subscription Revenue Recognition (Software As A Service)

Renewals or extensions of licenses are evaluated as distinct licenses and revenue attributed to the distinct service is not recognized until (1) the entity provides the distinct license (or makes the license available) to the customer and (2) the customer is able to use and benefit from the distinct license. Renewal contracts are not combined with original contracts, and, as a result, the renewal right is evaluated in the same manner as all other additional rights granted after the initial contract. The revenue is not recognized until the customer can begin to use and benefit from the license, which is typically at the beginning of the license renewal period. The Company recognizes revenue resulting from renewal of licensed software over time.

Professional Services Revenue Recognition

The Company provides integration and software customization professional services to its customers.

Professional services are also contracted on the fixed fee and in some cases on a time and materials basis. Fixed fees are paid monthly, in phases, or upon acceptance of deliverables. The Company’s time and materials contracts are paid weekly or monthly based on hours worked. Revenue on time and material contracts is recognized based on a fixed hourly rate as direct labor hours are expended. Materials, or other specified direct costs, are reimbursed as actual costs and may include markup. The Company has elected the practical expedient to recognize revenue for the right to invoice because the Company’s right to consideration corresponds directly with the value to the customer of the performance completed to date. For fixed fee contracts provided by in house personnel, the Company recognizes revenue evenly over the service period using a time-based measure because the Company is providing continuous service. Because the Company’s contracts have an expected duration of one year or less, the Company has elected the practical expedient in ASC 606-10-50-14(a) to not disclose information about its remaining performance obligations. Anticipated losses are recognized as soon as they become known. For the period from March 15, 2023, to December 31, 2023 (Successor), for the period from January 1, 2023, to March 14, 2023 (Predecessor), and year ended December 31, 2022 (Predecessor), the Company did not incur any such losses. These amounts are based on known and estimated factors.

Contract Balances

The timing of the Company’s revenue recognition may differ from the timing of invoicing to and payment by its customers. The Company records an unbilled receivable when revenue is recognized prior to invoicing and the Company has an unconditional right to payment. Alternatively, when invoicing a customer precedes the Company providing of the related services, the Company records deferred revenue until the performance obligations are satisfied. The Company had deferred revenue of approximately $2,878 thousand and $2,162 thousand as of December 31, 2023 (Successor) and December 31, 2022 (Predecessor), respectively, related to customer invoices rendered in advance for software licenses and professional services provided by the Company’s technical staff. The Company expects to satisfy its remaining performance obligations for the deferred revenue associated with professional services, and recognize the deferred revenue related to licenses generally over the remaining contract term which is generally twelve months following the commencement of the license. The Company recognized revenue in the reporting period of $2,163 thousand, $865 thousand, and $2,820 thousand, that was included in the deferred revenue at the beginning of the period, for the period from March 15, 2023, to December 31, 2023 (Successor), for the period from January 1, 2023, to March 14, 2023 (Predecessor), and for the year ended December 31, 2022 (Predecessor), respectively.

Costs to Obtain a Contract

Cost to Fulfill a Contract

The Company incurs costs to fulfill their obligations under a contract once it has obtained the contract. These costs are generally not significant and are recorded to expense as incurred.

Multiple Performance Obligations

Sales and Use Taxes

The Company presents transactional taxes such as sales and use tax collected from customers and remitted to government authorities on a net basis.

Shipping and Handling Costs

Shipping and handling costs are expensed as incurred as part of cost of revenues. These costs were deemed to be de minimis during each of the reporting periods.

Research and Development

Business Combinations

Segments

Stock-Based Compensation

The Company measures the cost of employee and non-employee services received in exchange for an award of equity instruments based on the grant date fair value of the award. The Company has issued stock-based compensation awards in the form of options and restricted stock units. Fair value for options and restricted stock units are valued using the closing price of our common stock on the date of grant. The grant date fair value is recognized over the requisite service period during which an employee and non-employee is required to provide service in exchange for the award.

The Company estimates forfeitures at the time of grant and revises these estimates in subsequent periods if actual forfeitures differ from those estimates.

Derivative Warrant Liabilities

For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of additional paid-in capital at the time of issuance or modification. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded at their initial fair value on the date of issuance as a warrant liability, and adjusted to the then fair value in each balance sheet date thereafter. Changes in the estimated fair value of the warrants are recognized as a non-cash gain or loss on the consolidated statements of operations and amounted to approximately $4,714 thousand of a loss for the period from March 15, 2023, to December 31, 2023 (Successor). The Company utilized the public warrant quoted market price as the fair value of the warrants as of each relevant date.

Earnings Per Share

The following table summarizes the number of common shares and common share equivalents excluded from the calculation of diluted net loss per common share for the year ended December 31, 2023.

Schedule of antidilutive shares
	Successor
(in thousands)	Year Ended December 31, 2023
Stock options		985
Restricted stock units		821
Warrants		21,032
Total		22,838

No calculation for Earnings Per Share was made for the year ended 2022 because CXApp only commenced operations in March 15, 2023.

Fair Value Measurements

●

Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities.

●

Level 2: Observable prices that are based on inputs not quoted on active markets but corroborated by market data.

●

Fair value measurements discussed herein are based upon certain market assumptions and pertinent information available to management. The fair value of the warrants has been measured based on the listed market price of such warrants, a Level 1 measurement. For the period ended March 15, 2023 to December 31, 2023 (Successor), the Company recognized an unrealized loss in the Statements of Operations and Comprehensive Income of $4,714 thousand which is presented as change in fair value of derivative liability.

The Company accounts for its public and private warrants as a derivative liability initially measured at its fair values and remeasured in the consolidated statements of operations at the end of each reporting period. When the warrants are exercised, the corresponding derivative liability is de-recognized at the underlying fair value of the Class A common stock that is issued to the warrant holder less any cash paid in accordance with the warrant agreement. Upon either cash or cashless exercise, the de-recognized derivative liability results in an increase in additional paid in capital equal to the difference between the fair value of the underlying Class A common stock and its par value. A cashless exercise results in the warrant holder surrendering Class A common stock equal to the stated warrant exercise price based on the contractual terms in the warrant agreement that governs the cashless conversion.

The following table shows the changes in fair value of the liabilities during the period ended December 31, 2023:


Balance at March 15, 2023	$	2,649
Change in FV of derivative instruments		(1,686	)
Balance at March 31, 2023		963
Change in FV of derivative instruments		12,040
Balance at June 30, 2023	$	13,003
Change in FV of derivative instruments		(5,220	)
FV of Warrants cash exercised and exchanged for Class A common stock (see Note 11 - Warrants)		(1,237	)
Loss on warrant extinguishment		(3,894	)
FV of Warrants cashless exercised for Class A common stock (see Note 11 - Warrants)		(549	)
Balance at September 30, 2023	$	2,103
Change in FV of derivative instruments		(420	)
Balance at December 31, 2023	$	1,683

Fair Value of Financial Instruments

Financial instruments consist of cash and cash equivalents, accounts receivable, notes and other receivables and accounts payable. The Company determines the estimated fair value of such financial instruments presented in the financial statements is equal to its carrying value due to their short-term nature.

Carrying Value, Recoverability and Impairment of Long-Lived Assets

The Company follows FASB ASC 360 “Property, Plant, and Equipment” (“ASC 360”) for its long-lived assets. Pursuant to ASC 360-10-35-17, an impairment loss shall be recognized only if the carrying amount of a long-lived asset (asset group) is not recoverable and exceeds its fair value. The carrying amount of a long-lived asset (asset group) is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset (asset group). That assessment shall be based on the carrying amount of the asset (asset group) at the date it is tested for recoverability. An impairment loss shall be measured as the amount by which the carrying amount of a long-lived asset (asset group) exceeds its fair value. Pursuant to ASC 360-10-35-20, if an impairment loss is recognized, the adjusted carrying amount of a long-lived asset shall be its new cost basis. For a depreciable long-lived asset, the new cost basis shall be depreciated (amortized) over the remaining useful life of that asset. Restoration of a previously recognized impairment loss is prohibited.

Based on its assessments, the Company recorded no impairment charges on long-lived assets for the period from March 15, 2023, to December 31, 2023 (Successor), for the period from January 1, 2023, to March 14, 2023 (Predecessor), and year ended December 31, 2022 (Predecessor).

New Accounting Pronouncements Adopted in 2023

In June 2016, the FASB issued Accounting Standards Update (ASU) No. 2016-13, “Financial Instruments – Credit Losses” (“ASU 2016-13”), which requires a reporting entity to determine the allowance for credit losses for an instrument based on the amortized cost of the financial asset. The expected credit loss model aims to provide stakeholders with more transparent and timely information regarding an entity’s credit risk exposures. At the same time, it provides processes and procedures in determining a doubtful account.

ASU 2016-13 is effective for interim and annual periods beginning after March 14, 2023, on a prospective basis, with early adoption permitted. The Company adopted ASU 2016-13 in the first quarter of fiscal 2023, March 31, 2023, and the impact of the adoption was not material.

Recently Issued Accounting Standards Not Yet Adopted

In July 2023, the FASB issued ASU 2023-03, “Presentation of Financial Statements (Topic 205), Income Statement - Reporting Comprehensive Income (Topic 220), Distinguishing Liabilities from Equity (Topic 480), Equity (Topic 505), and Compensation - Stock Compensation (Topic 718),” which updates codification on how an entity would apply the scope guidance in paragraph 718-10-15-3 to determine whether profits interest and similar awards should be accounted for in accordance with Topic 718, Compensation—Stock Compensation. The effective date of this update is for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. The Company is currently evaluating the impact of the adoption of this ASU will have on the Company’s consolidated financial position and results of operations.

In October 2023, the FASB issued ASU 2023-06 “Disclosure Improvements,” which amends the codification in response to the SEC’s Disclosure Update and Simplification Initiative. The effective date of this update is for fiscal years beginning after June 30, 2027, including interim periods within those fiscal years. The Company is currently assessing potential impacts of ASU 2023-06 and does not expect the adoption of this guidance will have a material impact on its consolidated financial statements and disclosures.

Stock Option Plan and Stock-Based Compensation (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands			1 Months Ended	2 Months Ended	3 Months Ended	10 Months Ended	12 Months Ended
	Feb. 06, 2024	Jan. 03, 2024	Mar. 31, 2024	Mar. 14, 2023	Mar. 31, 2024	Dec. 31, 2023	Dec. 31, 2023	Dec. 31, 2022	Mar. 10, 2023
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Stock option granted					705,000		1,377,172
Fair value of common stock as of grant date					$ 0.90		$ 0.90
Weighted average remaining term					9 years 10 months 9 days
Number of options, Forfeited							392,272
Successor [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Stock-based compensation			$ 2		$ 220	$ 1,080
Successor [Member] \| Employee Stock Options [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Stock-based compensation						239
Unrecognized stock compensation expense			500		$ 500	$ 394	$ 394
Weighted average remaining term					3 years 9 months 10 days	1 year 2 months 26 days
Successor [Member] \| Employee Stock Options [Member] \| Employees And Directors [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Stock option granted	705,000,000					1,377,172,000
Option life					10 years	10 years
Weighted average fair value					$ 1.20	$ 0.90
Fair value of common stock as of grant date					$ 1.21	$ 1.53
Successor [Member] \| Restricted Stock Units (RSUs) [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Stock-based compensation					$ 381	$ 686
Unrecognized stock compensation expense			$ 1,454		$ 1,454	$ 1,796	$ 1,796
Weighted average remaining term					1 year 9 months 3 days	1 year 5 months 1 day
Weighted average fair value restricted stock unit			$ 1.29		$ 1.29	$ 7.80	$ 7.80
Number of options, Forfeited						40,000
Successor [Member] \| Restricted Stock Units (RSUs) [Member] \| Minimum [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Fair value of common stock as of grant date					1.25	$ 6.13
Successor [Member] \| Restricted Stock Units (RSUs) [Member] \| Maximum [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Fair value of common stock as of grant date					$ 1.38	$ 11.80
Successor [Member] \| Restricted Stock Units (RSUs) [Member] \| Employees And Nonemployees [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Restricted stock units stock granted		47,000,000				526,165
Predecessor [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Stock-based compensation				$ 158				$ 1,640
Predecessor [Member] \| Employee Stock Options [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Stock-based compensation								$ 1,640
2023 Equity Incentive Plan [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Shares available for issuance									2,110,500

Property and Equipment, net

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Property, Plant and Equipment [Abstract]

Property and Equipment, net

NOTE 5 – Property and Equipment, net

Property and equipment consisted of the following (in thousands):

Schedule of property and equipment
	March 31, 2024			December 31, 2023
Computer and office equipment	$	187		$	179
Furniture and fixtures		12			12
Leasehold improvements		6			6
Software		1			1
Total		206			198
Less: accumulated depreciation and amortization		(96	)		(83	)
Total Property and Equipment, Net	$	110		$	115

Depreciation and amortization expense were approximately $22 thousand, $4 thousand, and $19 thousand, for the three months ended March 31, 2024 (Successor), for the period from March 15, 2023, to March 31, 2023 (Successor), and for the period from January 1, 2023, to March 14, 2023 (Predecessor), respectively.

NOTE 5 – Property and Equipment, net

Property and equipment consisted of the following (in thousands):

Schedule of property and equipment
	Successor			Predecessor
	December 31, 2023			December 31, 2022
Computer and office equipment	$	179		$	992
Furniture and fixtures		12			185
Leasehold improvements		6			28
Software		1			8
Total		198			1,213
Less: accumulated depreciation and amortization		(83	)		(1,011	)
Total Property and Equipment, Net	$	115		$	202

Depreciation and amortization expense were approximately $75 thousand, $19 thousand, and $119 thousand for the period from March 15, 2023, to December 31, 2023 (Successor), for the period from January 1, 2023, to March 14, 2023 (Predecessor), and for the year ended December 31, 2022 (Predecessor), respectively.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Unaudited) - USD ($) $ in Thousands	Net Parent Investment [Member] Predecessor [Member]	AOCI Attributable to Parent [Member] Predecessor [Member]	AOCI Attributable to Parent [Member] Successor [Member]	Total [Member] Predecessor [Member]	Total [Member] Successor [Member]	Class A Common Stock [Member] Successor [Member]	Class C Common Stock [Member] Successor [Member]	Additional Paid-in Capital [Member] Successor [Member]	Retained Earnings [Member] Successor [Member]
Beginning balance, value at Dec. 31, 2021	$ 20,155	$ 56		$ 20,211
Net loss	(29,175)			(29,175)
Stock-based compensation allocated from parent	1,640			1,640
Net investment from parent	26,023			26,023
Cumulative translation adjustment		1,099		1,099
Ending balance, value at Dec. 31, 2022	22,236	1,155		23,391
Net loss	(4,380)			(4,380)
Stock-based compensation allocated from parent	158			158
Net investment from parent	8,680			8,680
Cumulative translation adjustment		(28)		(28)
Ending balance, value at Mar. 14, 2023	26,694	1,127		27,821	$ (6,955)	$ 1		$ 1,607	$ (8,563)
Ending balance, shares at Mar. 14, 2023						7,034,999
Shares issued in connection with Business Combination					69,928		$ 1	69,927
Shares issued in connection with Business Combination, shares						1,547,700	5,487,300
Net loss					2,758				2,758
Stock-based compensation					(2)			(2)
Ending balance, value at Mar. 31, 2023					65,733	$ 1	$ 1	71,536	(5,805)
Ending balance, shares at Mar. 31, 2023						8,582,699	5,487,300
Beginning balance, value at Mar. 14, 2023	$ 26,694	$ 1,127		$ 27,821	(6,955)	$ 1		1,607	(8,563)
Beginning balance, shares at Mar. 14, 2023						7,034,999
Shares issued in connection with Business Combination					69,928		$ 1	69,927
Shares issued in connection with Business Combination, shares						1,547,700	5,487,300
Net loss					(49,238)				(49,238)
Stock-based compensation					925			925
Cumulative translation adjustment			(85)		(85)
Ending balance, value at Dec. 31, 2023			(85)		25,398	$ 2		83,282	(57,801)
Ending balance, shares at Dec. 31, 2023						15,254,389
Net loss					(5,170)				(5,170)
Stock-based compensation					599			599
Cumulative translation adjustment			54		54
Ending balance, value at Mar. 31, 2024			$ (31)		$ 20,881	$ 2		$ 83,881	$ (62,971)
Ending balance, shares at Mar. 31, 2024						15,254,389

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(g)(1)(ii))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 323
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 3
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481687/323-10-50-3

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 825
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 28
-Subparagraph (f)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482907/825-10-50-28

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 220
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 6
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482765/220-10-50-6

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 250
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 3
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483443/250-10-50-3

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 250
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (b)(2)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483443/250-10-50-1

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 815
-SubTopic 40
-Name Accounting Standards Codification
-Section 65
-Paragraph 1
-Subparagraph (f)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480175/815-40-65-1

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 250
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 8
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483443/250-10-50-8

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 250
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 9
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483443/250-10-50-9

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 250
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 11
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483443/250-10-50-11

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 250
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 11
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483443/250-10-50-11

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 250
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 4
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483443/250-10-50-4

Reference 13: http://www.xbrl.org/2003/role/exampleRef
-Topic 946
-SubTopic 830
-Name Accounting Standards Codification
-Section 55
-Paragraph 10
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480167/946-830-55-10

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 220
-Name Accounting Standards Codification
-Section 45
-Paragraph 7
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483581/946-220-45-7

Reference 15: http://www.xbrl.org/2003/role/disclosureRef
-Topic 944
-SubTopic 220
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.7-04(18))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483586/944-220-S99-1

Reference 16: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 22
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-22

Reference 17: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 220
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.6-07(9))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483575/946-220-S99-1

Reference 18: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 220
-Name Accounting Standards Codification
-Section S99
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+ Details

- Definition

Amount of equity (deficit) attributable to parent. Excludes temporary equity and equity attributable to noncontrolling interest.

+ References

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+ Details

Stock Option Plan and Stock-Based Compensation

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Stock Option Plan And Stock-based Compensation

Stock Option Plan and Stock-Based Compensation

NOTE 12 – Stock Option Plan and Stock-Based Compensation

To calculate the stock-based compensation resulting from the issuance of options, the Company uses the Black-Scholes option pricing model, which is affected by the Company’s fair value of its stock price as well as assumptions regarding a number of subjective variables. These variables include, but are not limited to, the Company’s expected stock price volatility over the term of the awards, and actual and projected employee stock option exercise behaviors.

2023 Equity Incentive Plan

At the special meeting held on March 10, 2023, the KINS stockholders considered and approved, among other things, the Incentive Plan. The Incentive Plan was previously approved, subject to stockholder approval, by KINS’ board of directors. The Incentive Plan became effective immediately upon the closing of the Business Combination. Pursuant to the terms of the Incentive Plan, there are 2,110,500 shares of CXApp Class A common stock available for issuance under the Incentive Plan, which is equal to 15% of the aggregate number of shares of CXApp common stock issued and outstanding immediately after the closing of the Business Combination (giving effect to the redemptions).

Employee Stock Options

On February 6, 2024, a total of 705,000 stock options to purchase common stock were granted to employees and consultants of the Company. These options vest over a four-year period. The options have a life of 10 years and an exercise price of $1.20 per option. The stock options were valued using the Black-Scholes option valuation model and the weighted average fair value of the awards granted during the period was determined to be $0.74 per option on the grant date. The fair value of the common stock as of the grant date utilized in the Black-Scholes option valuation model was $1.21 per share.

See below for a summary of the stock options granted under the Incentive Plan:

Schedule of stock options
	Number of Options		Weighted-average exercise price		Weighted average remaining contractual term (years)		Weighted-Average Fair Value at Grant Date
Options outstanding at January 1, 2024		984,900	$	1.53		9.00	$	0.90
Granted		705,000		1.20		9.86		0.74
Forfeited		-		-
Options outstanding at March 31, 2024		1,689,900
Options exercisable at March 31, 2024		492,450	$	1.53

Non-cash stock-based compensation expenses related to stock option were recorded in the financial statements as summarized below:

	Successor				Predecessor
	Three Months ended March 31, 2024		Period from March 15, 2023, to March 31, 2023		Period from January 1, 2023, to March 14, 2023
Research and development	$	3	$	-	$	-
Sales and marketing		32		-		-
General and administrative		185		2		158
Total non-cash stock compensation	$	220	$	2	$	158

As of March 31, 2024 (Successor), the remaining unrecognized stock compensation expense totaled approximately $500 thousand. This amount will be recognized as expense over the weighted average remaining term of 3.78 years.

The fair value of each employee option grant is estimated on the date of the grant using the Black-Scholes option-pricing model. Key weighted-average assumptions used to apply this pricing model for the three months ended March 31, 2024 (Successor) and the period from March 15, 2023, to December 31, 2023 (Successor) were as follows:

Schedule of assumptions used
Risk-free interest rate		3.67% – 4.03%
Expected life of option grants		5.75 – 6.25 years
Expected volatility of underlying stock		61.65%
Dividends assumption		$-

Restricted Stock Units

On January 2024, a total of 47,000 restricted stock units of common stock were granted to employees of the Company under the Incentive Plan at various dates.

The fair value of the common stock as of the various grant dates was determined to be $1.25 to $1.38 per restricted stock unit, for a weighted average fair value of $1.29 per restricted stock unit. There was no other activity related to restricted stock units for the three months ended March 31, 2024.

Non-cash stock-based compensation expenses related to restricted stock units for the three months ended March 31, 2024 were recorded in the financial statements as summarized below:


	Three Months ended March 31, 2024
Research and development	$	98
Sales and marketing		51
General and administrative		232
Total non-cash stock compensation	$	381

There were no non-cash stock-based compensation expenses related restricted stock units for the period from March 15, 2023, to March 31, 2023 (Successor) and period from January 1, 2023, to March 14, 2023 (Predecessor).

As of March 31, 2024 (Successor), the Company has approximately $1,454 thousand of unrecognized restricted stock unit compensation to be expensed over a weighted average period of 1.76 years.

NOTE 12 – Stock Option Plan and Stock-Based Compensation

2023 Equity Incentive Plan

Employee Stock Options

During the year ended December 31, 2023, a total of 1,377,172 stock options for the purchase of common stock were granted to employees and directors of the Company. These options vest over a two-year period, with 50% vested at the end of year one and 50% vested at the end of year two. The options have a life of 10 years and an exercise price of $1.53 per option. The stock options were valued using the Black-Scholes option valuation model and the weighted average fair value of the awards granted during the period was determined to be $0.90 per option on the grant date. The fair value of the common stock as of the grant date utilized in the Black-Scholes option valuation model was $1.53 per share.

See below for a summary of the stock options granted under the Incentive Plan:

Schedule of stock options
	Number of Options			Weighted average exercise price		Weighted average remaining contractual term (years)		Weighted- Average Fair Value at Grant Date
Options outstanding at January 1, 2023		-		$	-		-	$	-
Granted		1,377,172			1.53
Forfeited		(392,272	)		1.53
Options outstanding at December 31, 2023		984,900		$	1.53		9.25	$	0.90
Options exercisable at December 31, 2023		-		$	-		-		-

The Company incurred stock-based compensation expenses associated with options of approximately $239 thousand and $1,640 thousand for the years ended December 31, 2023 (Successor) and December 31, 2022 (Predecessor), respectively, which is included in general and administrative expenses of the consolidated statement of operations.

As of December 31, 2023 (Successor), the remaining unrecognized stock compensation expense totaled approximately $394 thousand. This amount will be recognized as expense over the weighted average remaining term of 1.24 years.

The fair value of each employee option grant is estimated on the date of the grant using the Black-Scholes option-pricing model. Key weighted-average assumptions used to apply this pricing model during the year ended December 31, 2023 (Successor) were as follows:

Schedule of assumptions used
Risk-free interest rate		3.67%
Expected life of option grants		5.75 years
Expected volatility of underlying stock		61.65%
Dividends assumption		$-

Restricted Stock Units

During the period from March 15, 2023, to December 31, 2023 (Successor), a total of 526,165 restricted stock units of common stock were granted to employees and nonemployees of the Company under the Incentive Plan at various dates.

The fair value of the common stock as of the various grant dates was determined to be $6.13 to $11.80 per restricted stock unit, for a weighted average fair value of $7.80 per restricted stock unit. There were 40,000 forfeited restricted stock units during the year ended December 31, 2023 (Successor).

Restricted stock unit compensation expense was $686 thousand for the period March 15, 2023, to December 31, 2023 (Successor), which is included in general and administrative expenses of the consolidated statement of operations.

As of December 31, 2023 (Successor), the Company has approximately $1,796 thousand of unrecognized restricted stock unit compensation to be expensed over a weighted average period of 1.42 years.

Goodwill and Intangible Assets (Details) - Successor [Member] - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount	$ 20,298	$ 20,298
Accumulated Amortization	(2,845)	(2,162)
Net carrying amount	$ 17,453	$ 18,136
Trademarks and Trade Names [Member]
Finite-Lived Intangible Assets [Line Items]
Remaining weighted average useful life	5 years 10 months 24 days	6 years 2 months 1 day
Gross carrying amount	$ 3,294	$ 3,294
Accumulated Amortization	(490)	(373)
Net carrying amount	$ 2,804	$ 2,921
Customer Relationships [Member]
Finite-Lived Intangible Assets [Line Items]
Remaining weighted average useful life	3 years 10 months 24 days	4 years 2 months 1 day
Gross carrying amount	$ 5,604	$ 5,604
Accumulated Amortization	(1,168)	(887)
Net carrying amount	$ 4,436	$ 4,717
Developed Technology Rights [Member]
Finite-Lived Intangible Assets [Line Items]
Remaining weighted average useful life	8 years 10 months 24 days	9 years 2 months 1 day
Gross carrying amount	$ 8,697	$ 8,697
Accumulated Amortization	(906)	(688)
Net carrying amount	$ 7,791	$ 8,009
Patents And Intellectual Property [Member]
Finite-Lived Intangible Assets [Line Items]
Remaining weighted average useful life	8 years 10 months 24 days	9 years 2 months 1 day
Gross carrying amount	$ 2,703	$ 2,703
Accumulated Amortization	(281)	(214)
Net carrying amount	$ 2,422	$ 2,489

Business Combination (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands	2 Months Ended	3 Months Ended	10 Months Ended	12 Months Ended
	Mar. 14, 2023	Mar. 31, 2024	Dec. 31, 2023	Dec. 31, 2023	Dec. 31, 2022
Business Acquisition [Line Items]
Measurement period adjustment description		Company continued to refine its inputs and estimates inherent in (i) the valuation of intangible assets, (ii) deferred income taxes, (iii) realization of tangible assets and (iv) the accuracy and completeness of liabilities through March 14, 2024, when the purchase price allocation was finalized. For the period ended March 14, 2024 (Successor), there was no measurement period adjustment.		Company recognized a measurement period adjustment, which decreased prepaid assets and other current assets, developed technology, accounts payable and deferred tax liability by approximately $180 thousand, $571 thousand, $18 thousand and $137 thousand, respectively and increased accrued liabilities and goodwill by approximately $58 thousand and $671 thousand, respectively.
Predecessor [Member]
Business Acquisition [Line Items]
Share price	$ 9.94
Business combination goodwill	$ 44,122
Acquisition-related costs					$ 16
Predecessor [Member] \| KINS [Member]
Business Acquisition [Line Items]
Acquisition-related costs	3,000
Predecessor [Member] \| Merger Agreement [Member]
Business Acquisition [Line Items]
Aggregate purchase price assets and liabilities	$ 69,928
Predecessor [Member] \| Merger Agreement [Member] \| Common Class A [Member]
Business Acquisition [Line Items]
Consideration transferred in connection	1,547,700
Predecessor [Member] \| Merger Agreement [Member] \| Common Class C [Member]
Business Acquisition [Line Items]
Consideration transferred in connection	5,487,300
Successor [Member]
Business Acquisition [Line Items]
Acquisition-related costs			$ 543

Software Development Costs, net (Tables)

12 Months Ended

Dec. 31, 2023

Software Development Costs Net

Schedule of capitalized software development


	Successor		Predecessor
	December 31, 2023		December 31, 2022
Capitalized software development costs	$	-	$	2,680
Accumulated amortization		-		(2,193	)
Software development costs, net	$	-	$	487

Goodwill and Intangible Assets, net (Details Narrative) - USD ($) $ in Thousands	1 Months Ended	3 Months Ended	10 Months Ended
	Dec. 31, 2023	Dec. 31, 2023	Dec. 31, 2023	Mar. 31, 2024	Mar. 14, 2023
Impairment on goodwill	$ 36,056	$ 36,056
Successor [Member]
Goodwill	$ 8,737	$ 8,737	$ 8,737	$ 8,737
Impairment on goodwill			$ 36,056

- Definition

Amount after accumulated impairment loss of an asset representing future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized.

+ References + Details

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands	Net Parent Investment [Member] Predecessor [Member]	AOCI Attributable to Parent [Member] Predecessor [Member]	AOCI Attributable to Parent [Member] Successor [Member]	Total [Member] Predecessor [Member]	Total [Member] Successor [Member]	Class A Common Stock [Member] Successor [Member]	Class C Common Stock [Member] Successor [Member]	Additional Paid-in Capital [Member] Successor [Member]	Retained Earnings [Member] Successor [Member]
Beginning balance, value at Dec. 31, 2021	$ 20,155	$ 56		$ 20,211
Net loss	(29,175)			(29,175)
Stock-based compensation allocated from parent	1,640			1,640
Parents’s common shares issued for CXApp earnout	3,697			3,697
Taxes paid related to net share settlement of restricted stock units	(104)			(104)
Net investment from parent	26,023			26,023
Cumulative translation adjustment		1,099		1,099
Ending balance, value at Dec. 31, 2022	22,236	1,155		23,391
Net loss	(4,380)			(4,380)
Stock-based compensation allocated from parent	158			158
Net investment from parent	8,680			8,680
Cumulative translation adjustment		(28)		(28)
Ending balance, value at Mar. 14, 2023	26,694	1,127		27,821	$ (6,955)	$ 1		$ 1,607	$ (8,563)
Ending balance, shares at Mar. 14, 2023						7,034,999
Net loss					2,758				2,758
Shares issued in connection with Business Combination					69,928		$ 1	69,927
Shares issued in connection with Business Combination, shares						1,547,700	5,487,300
Stock-based compensation					(2)			(2)
Ending balance, value at Mar. 31, 2023					65,733	$ 1	$ 1	71,536	(5,805)
Ending balance, shares at Mar. 31, 2023						8,582,699	5,487,300
Beginning balance, value at Mar. 14, 2023	$ 26,694	$ 1,127		$ 27,821	(6,955)	$ 1		1,607	(8,563)
Beginning balance, shares at Mar. 14, 2023						7,034,999
Net loss					(49,238)				(49,238)
Cumulative translation adjustment			(85)		(85)
Shares issued in connection with Business Combination					69,928		$ 1	69,927
Shares issued in connection with Business Combination, shares						1,547,700	5,487,300
Stock-based compensation					925			925
Warrant exchange and exercise					10,134			10,134
Warrant exchange and exercise, shares						1,035,000
Warrant exercise – cashless					548			548
Warrant exercise - cash and cashless, shares						49,608
Mandatory conversion from Class C common stock to Class A common stock						$ 1	$ (1)
Mandatory conversion from Class C common stock to Class A common stock, shares						5,487,300	(5,487,300)
Common stock issuance – non-cash compensation					195			195
Common stock issuance - non-cash compensation, shares						99,782
Stock issuance cost					(54)			(54)
Ending balance, value at Dec. 31, 2023			(85)		25,398	$ 2		83,282	(57,801)
Ending balance, shares at Dec. 31, 2023						15,254,389
Net loss					(5,170)				(5,170)
Cumulative translation adjustment			54		54
Stock-based compensation					599			599
Ending balance, value at Mar. 31, 2024			$ (31)		$ 20,881	$ 2		$ 83,881	$ (62,971)
Ending balance, shares at Mar. 31, 2024						15,254,389

Goodwill and Intangible Assets

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

NOTE 7 – Goodwill and Intangible Assets

The Company reviews goodwill and intangible assets for impairment on a reporting unit basis on December 31 of each year and whenever events or changes in circumstances indicate the carrying value of goodwill may not be recoverable. The Company noted that the carrying amount of Goodwill as of March 31, 2024 (Successor) was $8,737 thousand, which was entirely due to the business combination noted in Note 3.

Factors that may be considered a change in circumstances indicating that the carrying value of our goodwill or amortizable intangible assets may not be recoverable include a decline in industry and market considerations, technological advancements, and the Company’s financial performance.

We completed our annual goodwill impairment evaluation as of December 31, 2023. As a result, the Company incurred an impairment loss of $36,056 thousand.

The Company noted that there were no qualitative or quantitative indicators of impairment present at the reporting date as of March 31, 2024 (Successor).

Intangible assets consisted of the following (in thousands):

Schedule of intangible assets
	March 31, 2024								December 31, 2023
	Weighted Average Remaining Useful Life (Years)	Gross Amount		Accumulated Amortization			Net Carrying Amount		Gross Amount		Accumulated Amortization			Net Carrying Amount
Trade Name/Trademarks	5.9	$	3,294	$	(490	)	$	2,804	$	3,294	$	(373	)	$	2,921
Customer Relationships	3.9		5,604		(1,168	)		4,436		5,604		(887	)		4,717
Developed Technology	8.9		8,697		(906	)		7,791		8,697		(688	)		8,009
Patents and Intellectual Property	8.9		2,703		(281	)		2,422		2,703		(214	)		2,489
Totals		$	20,298	$	(2,845	)	$	17,453	$	20,298	$	(2,162	)	$	18,136

Future amortization expense on intangible assets as of March 2024 is anticipated to be as follows (in thousands):


For the Years Ending December 31,	Amount
2024 (remainder of year)	$	2,048
2025		2,731
2026		2,731
2027		2,731
2028		1,844
2029 and thereafter		5,368
Total	$	17,453

NOTE 7 – Goodwill and Intangible Assets, net

The Company reviews goodwill for impairment on a reporting unit basis on December 31 of each year and whenever events or changes in circumstances indicate the carrying value of goodwill may not be recoverable. The Company noted that the carrying amount of Goodwill as of December 31, 2023, was $8,737 thousand, which was entirely due to the business combination noted in Note 3.

We completed our annual goodwill impairment evaluation as of December 31, 2023. As a result, the Company incurred an impairment loss of $36,056 thousand.

Goodwill consisted of the following (in thousands):


Acquisition	Amount
Balance as of March 15, 2023	$	-
Acquisition of Legacy CXApp		44,122
Measurement Period Adjustments		671
Impairment		(36,056	)
Balance as of December 31, 2023	$	8,737

Intangible assets consisted of the following (in thousands):

Schedule of intangible assets
	December 31, 2023 (Successor)								December 31, 2022 (Predecessor)
	Weighted Average Remaining Useful Life (Years)	Gross Amount		Accumulated Amortization			Net Carrying Amount		Gross Amount		Accumulated Amortization			Net Carrying Amount
Trade Name/Trademarks	6.17	$	3,294	$	(373	)	$	2,921	$	2,183	$	(725	)	$	1,458
Customer Relationships	4.17		5,604		(887	)		4,717		6,401		(1,765	)		4,636
Developed Technology	9.17		8,697		(688	)		8,009		15,179		(3,398	)		11,781
Non-compete Agreements	-		-		-			-		3,150		(1,736	)		1,414
Patents and Intellectual Property	9.17		2,703		(214	)		2,489		-		-			-
Totals		$	20,298	$	(2,162	)	$	18,136	$	26,913	$	(7,624	)	$	19,289

Future amortization expense on intangible assets as of December 31, 2023, is anticipated to be as follows (in thousands):

Schedule of future amortization expense
For the Years Ending December 31,	Amount
2024	$	2,731
2025		2,731
2026		2,731
2027		2,731
2028		1,844
2029 and thereafter		5,368
Total	$	18,136

Goodwill and Intangible Assets, net (Tables)

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Goodwill [Table Text Block]


Acquisition	Amount
Balance as of March 15, 2023	$	-
Acquisition of Legacy CXApp		44,122
Measurement Period Adjustments		671
Impairment		(36,056	)
Balance as of December 31, 2023	$	8,737

Schedule of intangible assets

Schedule of intangible assets
	March 31, 2024								December 31, 2023
	Weighted Average Remaining Useful Life (Years)	Gross Amount		Accumulated Amortization			Net Carrying Amount		Gross Amount		Accumulated Amortization			Net Carrying Amount
Trade Name/Trademarks	5.9	$	3,294	$	(490	)	$	2,804	$	3,294	$	(373	)	$	2,921
Customer Relationships	3.9		5,604		(1,168	)		4,436		5,604		(887	)		4,717
Developed Technology	8.9		8,697		(906	)		7,791		8,697		(688	)		8,009
Patents and Intellectual Property	8.9		2,703		(281	)		2,422		2,703		(214	)		2,489
Totals		$	20,298	$	(2,845	)	$	17,453	$	20,298	$	(2,162	)	$	18,136

Schedule of intangible assets
	December 31, 2023 (Successor)								December 31, 2022 (Predecessor)
	Weighted Average Remaining Useful Life (Years)	Gross Amount		Accumulated Amortization			Net Carrying Amount		Gross Amount		Accumulated Amortization			Net Carrying Amount
Trade Name/Trademarks	6.17	$	3,294	$	(373	)	$	2,921	$	2,183	$	(725	)	$	1,458
Customer Relationships	4.17		5,604		(887	)		4,717		6,401		(1,765	)		4,636
Developed Technology	9.17		8,697		(688	)		8,009		15,179		(3,398	)		11,781
Non-compete Agreements	-		-		-			-		3,150		(1,736	)		1,414
Patents and Intellectual Property	9.17		2,703		(214	)		2,489		-		-			-
Totals		$	20,298	$	(2,162	)	$	18,136	$	26,913	$	(7,624	)	$	19,289

Schedule of future amortization expense


For the Years Ending December 31,	Amount
2024 (remainder of year)	$	2,048
2025		2,731
2026		2,731
2027		2,731
2028		1,844
2029 and thereafter		5,368
Total	$	17,453

Schedule of future amortization expense
For the Years Ending December 31,	Amount
2024	$	2,731
2025		2,731
2026		2,731
2027		2,731
2028		1,844
2029 and thereafter		5,368
Total	$	18,136

- Definition

Tabular disclosure of goodwill by reportable segment and in total which includes a rollforward schedule.

+ References

Reference 1: http://www.xbrl.org/2003/role/exampleRef
-Topic 350
-SubTopic 20
-Name Accounting Standards Codification
-Section 55
-Paragraph 24
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482548/350-20-55-24

Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482573/350-20-50-1

Reference 3: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (h)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482573/350-20-50-1

Reference 4: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482573/350-20-50-1

Reference 5: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482573/350-20-50-1

Reference 6: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482573/350-20-50-1

Reference 7: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482573/350-20-50-1

Reference 8: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (e)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482573/350-20-50-1

Reference 9: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (f)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482573/350-20-50-1

Reference 10: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (g)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482573/350-20-50-1

Reference 11: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1A
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482573/350-20-50-1A

Reference 12: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 350
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482573/350-20-50-2

+ Details

Income Taxes (Details Narrative) - USD ($) $ in Thousands	1 Months Ended	2 Months Ended	3 Months Ended	10 Months Ended	12 Months Ended
Income Taxes (Details Narrative) - USD ($) $ in Thousands	Mar. 31, 2023	Mar. 14, 2023	Mar. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Successor [Member]
Income tax benefit/(provision)	$ 1,560		$ 207	$ 3,572
Effective tax rate			3.85%	6.76%
Predecessor [Member]
Income tax benefit/(provision)		$ 0			$ 153
Effective tax rate	(164.00%)				(0.53%)

Income Tax (Details 2)	1 Months Ended	2 Months Ended	3 Months Ended	10 Months Ended	12 Months Ended
Income Tax (Details 2)	Mar. 31, 2023	Mar. 14, 2023	Mar. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Successor [Member]
Statutory federal income tax rate				21.00%
Incentive stock options
Change in fair value of derivative warrant liabilities				(2.18%)
Goodwill impairment loss				(14.34%)
US-Foreign income tax rate difference
Permanent difference				0.22%
Cancellation of debt income
Rate differential on foreign earnings				0.24%
State taxes, net of federal tax benefit				0.93%
Current federal tax true-up				0.01%
Provision to return adjustments
Deferred only adjustment
Other
Valuation allowance				0.88%
Income tax provision			3.85%	6.76%
Predecessor [Member]
Statutory federal income tax rate		21.00%			21.00%
Incentive stock options		(0.30%)			(0.16%)
Change in fair value of derivative warrant liabilities
Goodwill impairment loss					(4.00%)
US-Foreign income tax rate difference		1.30%			1.02%
Permanent difference		0.07%			(1.01%)
Cancellation of debt income		(101.38%)
Rate differential on foreign earnings
State taxes, net of federal tax benefit		3.49%			2.01%
Current federal tax true-up
Provision to return adjustments					(1.29%)
Deferred only adjustment		4.80%			(0.91%)
Other		(0.35%)			(0.06%)
Valuation allowance		71.31%			(17.13%)
Income tax provision	(164.00%)				(0.53%)

Leases (Tables)

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Leases [Abstract]

Schedule of operating leases

Schedule of operating leases Schedule of operating leases
(in thousands)	Operating Leases
Year 2024	$	197
Year 2025		174
Year 2026		59
Total lease payments		430
Less: Imputed interest		(39	)
Present value of lease liabilities	$	391

Schedule of operating leases
(in thousands)	Operating Leases
Year 2024	$	315
Year 2025		177
Year 2026		60
Total lease payments		552
Less: Imputed interest		(47	)
Present value of lease liabilities	$	505

Stock Option Plan and Stock-Based Compensation (Details 1) - USD ($) $ in Thousands	1 Months Ended	2 Months Ended	3 Months Ended	10 Months Ended	12 Months Ended
	Mar. 31, 2024	Mar. 14, 2023	Mar. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Successor [Member]
Risk-free interest rate				3.67%
Expected life of option grants				5 years 9 months
Expected volatility of underlying stock			61.65%	61.65%
Dividends assumption				(0.00%)
Stock-based compensation	$ 2		$ 220	$ 1,080
Successor [Member] \| Research and Development Expense [Member]
Stock-based compensation			3
Successor [Member] \| Selling and Marketing Expense [Member]
Stock-based compensation			32
Successor [Member] \| General and Administrative Expense [Member]
Stock-based compensation	$ 2		$ 185
Predecessor [Member]
Stock-based compensation		$ 158			$ 1,640
Predecessor [Member] \| Research and Development Expense [Member]
Stock-based compensation
Predecessor [Member] \| Selling and Marketing Expense [Member]
Stock-based compensation
Predecessor [Member] \| General and Administrative Expense [Member]
Stock-based compensation		$ 158

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - Successor [Member] - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Allowance for credit losses	$ 2	$ 2
Common Class A [Member]
Common stock, par value	$ 0.0001	$ 0.0001
Common stock, shares authorized	200,000,000	200,000,000
Common stock, shares issued	15,254,389	15,254,389
Common stock, shares outstanding	15,254,389	15,254,389

Business Combination (Details) - USD ($) $ in Thousands	2 Months Ended	3 Months Ended	12 Months Ended
Business Combination (Details) - USD ($) $ in Thousands	Mar. 14, 2023	Mar. 31, 2023	Dec. 31, 2023	Dec. 31, 2022
Assets
Current assets			$ 9,029	$ 8,798
Noncurrent assets			27,552	24,635
Total assets			36,581	33,433
Liabilities
Current liabilities			10,316	8,645
Noncurrent liabilities			867	1,197
Total liabilities			11,183	9,842
Total stockholders’ equity			25,398	23,591
Total liabilities and equity			36,581	33,433
Revenues		$ 1,962	7,366	8,470
Net loss		$ (6,365)	$ (57,904)	(20,828)
Predecessor [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Purchase Price	$ 69,928
Cash and cash equivalents	10,003
Accounts receivable	2,226
Notes and other receivables	209
Prepaid assets and other current assets	588
Operating lease right of use asset	557
Property and equipment, net	133
Other assets	42
Total assets acquired	34,627
Accounts payable	461
Accrued liabilities	911
Deferred revenues	2,534
Operating lease obligation, current	194
Operating lease obligation, noncurrent	384
Deferred tax liability	4,337
Total liabilities assumed	8,821
Goodwill	44,122
Assets
Current assets				8,569
Total assets				29,280
Liabilities
Current liabilities				5,415
Total liabilities				5,889
Total stockholders’ equity				23,391
Total liabilities and equity				$ 29,280
Prepaid assets and other current assets	408
Total assets acquired	33,876
Accounts payable	443
Accrued liabilities	969
Deferred tax liability	4,217
Total liabilities assumed	8,741
Goodwill	$ 44,793
Predecessor [Member] \| Property Subject to Operating Lease [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Weighted Average Useful Life	3 years
Predecessor [Member] \| Property, Plant and Equipment [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Weighted Average Useful Life	3 years
Predecessor [Member] \| Developed Technology Rights [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Intangible assets	$ 9,268
Weighted Average Useful Life	10 years
Intangible assets	$ 8,697
Predecessor [Member] \| Patents [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Weighted Average Useful Life	10 years
Intangible assets	$ 2,703
Predecessor [Member] \| Customer Relationships [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Weighted Average Useful Life	5 years
Intangible assets	$ 5,604
Predecessor [Member] \| Trademarks and Trade Names [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Weighted Average Useful Life	7 years
Intangible assets	$ 3,294

Goodwill and Intangible Assets, net

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets, net

NOTE 7 – Goodwill and Intangible Assets

We completed our annual goodwill impairment evaluation as of December 31, 2023. As a result, the Company incurred an impairment loss of $36,056 thousand.

The Company noted that there were no qualitative or quantitative indicators of impairment present at the reporting date as of March 31, 2024 (Successor).

Intangible assets consisted of the following (in thousands):

Schedule of intangible assets
	March 31, 2024								December 31, 2023
	Weighted Average Remaining Useful Life (Years)	Gross Amount		Accumulated Amortization			Net Carrying Amount		Gross Amount		Accumulated Amortization			Net Carrying Amount
Trade Name/Trademarks	5.9	$	3,294	$	(490	)	$	2,804	$	3,294	$	(373	)	$	2,921
Customer Relationships	3.9		5,604		(1,168	)		4,436		5,604		(887	)		4,717
Developed Technology	8.9		8,697		(906	)		7,791		8,697		(688	)		8,009
Patents and Intellectual Property	8.9		2,703		(281	)		2,422		2,703		(214	)		2,489
Totals		$	20,298	$	(2,845	)	$	17,453	$	20,298	$	(2,162	)	$	18,136

Future amortization expense on intangible assets as of March 2024 is anticipated to be as follows (in thousands):


For the Years Ending December 31,	Amount
2024 (remainder of year)	$	2,048
2025		2,731
2026		2,731
2027		2,731
2028		1,844
2029 and thereafter		5,368
Total	$	17,453

NOTE 7 – Goodwill and Intangible Assets, net

We completed our annual goodwill impairment evaluation as of December 31, 2023. As a result, the Company incurred an impairment loss of $36,056 thousand.

Goodwill consisted of the following (in thousands):


Acquisition	Amount
Balance as of March 15, 2023	$	-
Acquisition of Legacy CXApp		44,122
Measurement Period Adjustments		671
Impairment		(36,056	)
Balance as of December 31, 2023	$	8,737

Intangible assets consisted of the following (in thousands):

Schedule of intangible assets
	December 31, 2023 (Successor)								December 31, 2022 (Predecessor)
	Weighted Average Remaining Useful Life (Years)	Gross Amount		Accumulated Amortization			Net Carrying Amount		Gross Amount		Accumulated Amortization			Net Carrying Amount
Trade Name/Trademarks	6.17	$	3,294	$	(373	)	$	2,921	$	2,183	$	(725	)	$	1,458
Customer Relationships	4.17		5,604		(887	)		4,717		6,401		(1,765	)		4,636
Developed Technology	9.17		8,697		(688	)		8,009		15,179		(3,398	)		11,781
Non-compete Agreements	-		-		-			-		3,150		(1,736	)		1,414
Patents and Intellectual Property	9.17		2,703		(214	)		2,489		-		-			-
Totals		$	20,298	$	(2,162	)	$	18,136	$	26,913	$	(7,624	)	$	19,289

Future amortization expense on intangible assets as of December 31, 2023, is anticipated to be as follows (in thousands):

Schedule of future amortization expense
For the Years Ending December 31,	Amount
2024	$	2,731
2025		2,731
2026		2,731
2027		2,731
2028		1,844
2029 and thereafter		5,368
Total	$	18,136

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands	1 Months Ended		2 Months Ended	3 Months Ended								10 Months Ended	12 Months Ended
	Dec. 31, 2023	Mar. 31, 2023	Mar. 14, 2023	Mar. 31, 2024	Dec. 31, 2023	Sep. 30, 2023	Jun. 30, 2023	Dec. 31, 2022	Sep. 30, 2022	Jun. 30, 2022	Mar. 31, 2022	Dec. 31, 2023	Dec. 31, 2023	Dec. 31, 2022
Gross Profit													$ 5,615
Operating Expenses
Impairment of goodwill	$ 36,056				$ 36,056
Successor [Member]
Revenues		$ 342		$ 1,818								$ 5,746
Cost of Revenues		87		327								1,268
Gross Profit		255		1,491	$ 1,376	$ 1,412	$ 1,435					4,478
Operating Expenses
Research and development		211		1,599								5,309
Sales and marketing		174		1,114								3,242
General and administrative		241		1,682								5,374
Acquisition related costs												543
Amortization of intangible assets		116		683								2,162
Impairment of goodwill												36,056
Total Operating Expenses		742		5,078								52,686
Loss from Operations		(487)		(3,587)								(48,208)
Other Income (Expense)
Interest income (expense), net		(1)		(262)								65
Change in fair value of derivative liability		1,686		(1,472)								(4,714)
Other Expense				(56)								47
Total Other Income (Expense)		1,685		(1,790)								(4,602)
Net Loss, before tax		1,198		(5,377)								(52,810)
Income tax benefit/(expense)		1,560		207								3,572
Net Loss		2,758		(5,170)								(49,238)
Unrealized foreign exchange gain/(loss) from cumulative translation adjustments				54								(85)
Comprehensive Loss		$ 2,758		$ (5,116)								$ (49,323)
Successor [Member] \| Common Class A [Member]
Other Income (Expense)
Basic weighted average shares outstanding		8,582,699		15,254,389								11,403,393
Diluted weighted average shares outstanding		8,582,699		15,254,389								11,403,393
Basic net income (loss) per share		$ 0.20		$ (0.34)								$ (4.32)
Diluted net income (loss) per share		$ 0.20		$ (0.34)								$ (4.32)
Successor [Member] \| Class C Common Stock [Member]
Other Income (Expense)
Basic weighted average shares outstanding		5,487,300					5,487,300
Diluted weighted average shares outstanding		5,487,300					5,487,300
Basic net income (loss) per share		$ 0.20					$ (1.05)
Diluted net income (loss) per share		$ 0.20					$ (1.05)
Predecessor [Member]
Revenues			$ 1,620											$ 8,470
Cost of Revenues			483											2,064
Gross Profit			1,137					$ 1,561	$ 1,243	$ 1,609	$ 1,993			6,406
Operating Expenses
Research and development			1,455											9,323
Sales and marketing			964											5,096
General and administrative			2,293											11,571
Acquisition related costs														16
Amortization of intangible assets			806											3,885
Impairment of goodwill			(0)											5,540
Total Operating Expenses			5,518											35,431
Loss from Operations			(4,381)											(29,025)
Other Income (Expense)
Interest income (expense), net			1											4
Change in fair value of derivative liability
Other Expense														(1)
Total Other Income (Expense)			1											3
Net Loss, before tax			(4,380)											(29,022)
Income tax benefit/(expense)														(153)
Net Loss			(4,380)											(29,175)
Unrealized foreign exchange gain/(loss) from cumulative translation adjustments			(28)											1,155
Comprehensive Loss			$ (4,408)											$ (28,020)

Summary of Significant Accounting Policies (Tables)

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Accounting Policies [Abstract]

Schedule of antidilutive shares

Schedule of antidilutive shares
(in thousands)	Three Months Ended March 31, 2024		Period from March 15, 2023, to March 31, 2023
Stock options		1,689,900		1,377,000
Restricted stock units		533,165		-
Warrants		21,032,000		24,080,000
Total		23,255,065		25,457,000

Schedule of antidilutive shares
	Successor
(in thousands)	Year Ended December 31, 2023
Stock options		985
Restricted stock units		821
Warrants		21,032
Total		22,838

Schedule of changes in fair value of the liabilities


Warrant liability – January 1, 2024	$	1,683
Change in FV of derivative instruments		1,472
Warrant liability – March 31, 2024	$	3,155

Warrant liability – March 15, 2023	$	2,649
Change in FV of derivative instruments		(1,686	)
Warrant liability – March 31, 2023	$	963


Balance at March 15, 2023	$	2,649
Change in FV of derivative instruments		(1,686	)
Balance at March 31, 2023		963
Change in FV of derivative instruments		12,040
Balance at June 30, 2023	$	13,003
Change in FV of derivative instruments		(5,220	)
FV of Warrants cash exercised and exchanged for Class A common stock (see Note 11 - Warrants)		(1,237	)
Loss on warrant extinguishment		(3,894	)
FV of Warrants cashless exercised for Class A common stock (see Note 11 - Warrants)		(549	)
Balance at September 30, 2023	$	2,103
Change in FV of derivative instruments		(420	)
Balance at December 31, 2023	$	1,683

Business Combination

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Business Combination and Asset Acquisition [Abstract]

Business Combination

NOTE 3 – Business Combination

On March 14, 2023, the Company completed the Agreement and Plan of Merger (the “Merger Agreement”), by and among KINS, Inpixon, CXApp, and KINS Merger Sub Inc., a Delaware corporation and a wholly owned subsidiary of KINS (“Merger Sub”), pursuant to which KINS combined with Legacy CXApp, Inpixon’s enterprise apps business (including its workplace experience technologies, indoor mapping, events platform, augmented reality and related business solutions) (the “Enterprise Apps Business”). In exchange for the aggregate purchase price of approximately $69,928 thousand, the Company acquired all of the related assets and liabilities of Legacy CXApp. The consideration transferred in connection with the Business Combination consisted of 1,547,700 shares of the Company’s Class A common stock and 5,487,300 shares of the Company’s Class C common stock valued at a price of $9.94 per share. The preliminary estimated goodwill of approximately $44,200 thousand arising from the Business Combination consists of an acquired workforce, as well as synergies expected from combined operations of KINS and the CXApp.

The Company has authorized Class A and Class C common stock. Class A common stock and New CXApp Class C common stock are identical in all respects, except that New CXApp Class C common stock is not listed and will automatically convert into New CXApp Class A common stock on the earlier to occur of (i) the 180th day following the closing of the Merger which has expired and (ii) the day that the last reported sale price of New CXApp Class A common stock equals or exceeds $12.00 per share for any 20 trading days within any 30-trading day period following the closing of the Merger.

The Business Combination is being accounted for as a business combination in accordance with ASC 805. The Company has determined fair values of the assets acquired and liabilities assumed in the Business Combination.

The Company allocated the purchase price of the Business Combination to the assets acquired and the liabilities assumed as of the closing date. The following table summarizes the purchase price allocations relating to the Business Combination (in thousands):

Schedule of assets acquired
Description	Fair Value		Weighted Average Useful Life (in years)
Purchase Price	$	69,928

Assets acquired:
Cash and cash equivalents	$	10,003
Accounts receivable		2,226
Notes and other receivables		209
Prepaid assets and other current assets		408
Operating lease right of use asset		557	3 years
Property and equipment, net		133	3 years
Other assets		42
Developed technology		8,697	10 years
Patents		2,703	10 years
Customer relationships		5,604	5 years
Tradenames and trademarks		3,294	7 years
Total assets acquired	$	33,876

Liabilities assumed:
Accounts payable	$	443
Accrued liabilities		969
Deferred revenues		2,534
Operating lease obligation, current		194
Operating lease obligation, noncurrent		384
Deferred tax liability		4,217
Total liabilities assumed		8,741
Goodwill	$	44,793

The value of the intangible assets were calculated by a third-party valuation firm based on projections and financial data provided by management of the Company. Goodwill represents the excess fair value after allocation to the intangible assets. The calculated goodwill is not deductible for tax purposes.

Total acquisition-related costs for the Business Combination were approximately $3,543 thousand. Of the total acquisition-related costs, approximately $3,000 thousand were incurred by KINS prior to the close of the Business Combination. These costs are included in the opening retained earnings of the Company on March 15, 2023. The remaining $543 thousand of acquisition-related costs were recorded as expense in the successor period and are included in acquisition related costs on the statements of operations for the year ended December 31, 2023.

Measurement Period

The purchase price allocations for the acquisitions described above are based on initial estimates and provisional amounts. In accordance with ASC 805-10-25-13, if the initial accounting for a business combination is incomplete by the end of the reporting period in which the combination occurs, the acquirer shall report in its financial statements provisional amounts for the items for which the accounting is incomplete. During the measurement period, acquirer shall adjust the provisional amounts recognized at the acquisition date to reflect new information obtained about facts and circumstances that existed as of the acquisition date that, if known, would have affected the measurement of the amounts recognized as of that date. The Company continued to refine its inputs and estimates inherent in (i) the valuation of intangible assets, (ii) deferred income taxes, (iii) realization of tangible assets and (iv) the accuracy and completeness of liabilities through March 14, 2024, when the purchase price allocation was finalized. For the period ended March 14, 2024 (Successor), there was no measurement period adjustment.

CXApp Proforma Financial Information

The following unaudited proforma financial information presents the condensed consolidated results of operations of the Company for the three-month period ended March 31, 2023, as if the acquisition had occurred as of the beginning of the first period presented (January 1, 2023) instead of on March 14, 2023. The proforma information does not necessarily reflect the results of operations that would have occurred had the entities been a single company during those periods.

The proforma financial information for the Company and the acquired CXApp is as follows (in thousands):


	For the Three Months Ended March 31, 2023
Revenues	$	1,962
Net income (loss)		(6,365	)

NOTE 3 – Business Combination

On March 14, 2023, the Company completed the Agreement and Plan of Merger (the “Merger Agreement”), by and among KINS, Inpixon, CXApp, and KINS Merger Sub Inc., a Delaware corporation and a wholly owned subsidiary of KINS (“Merger Sub”), pursuant to which KINS combined with Legacy CXApp, Inpixon’s enterprise apps business (including its workplace experience technologies, indoor mapping, events platform, augmented reality and related business solutions) (the “Enterprise Apps Business”). In exchange for the aggregate purchase price of approximately $69,928 thousand, the Company acquired all of the related assets and liabilities of Legacy CXApp. The consideration transferred in connection with the Business Combination consisted of 1,547,700 shares of the Company’s Class A common stock and 5,487,300 shares of the Company’s Class C common stock valued at a price of $9.94 per share. The preliminary estimated goodwill of approximately $44,122 thousand arising from the Business Combination consists of an acquired workforce, as well as synergies expected from combined operations of KINS and the CXApp.

The Business Combination is being accounted for as a business combination in accordance with ASC 805. The Company has determined preliminary fair values of the assets acquired and liabilities assumed in the Business Combination. These values are subject to change as we perform additional reviews of our assumptions utilized.

The Company has made a provisional allocation of the purchase price of the Business Combination to the assets acquired and the liabilities assumed as of the closing date. The following table summarizes the preliminary purchase price allocations relating to the Business Combination (in thousands):

Schedule of assets acquired
Description	Fair Value		Weighted Average Useful Life (in years)
Purchase Price	$	69,928

Assets acquired:
Cash and cash equivalents	$	10,003
Accounts receivable		2,226
Notes and other receivables		209
Prepaid assets and other current assets		588
Operating lease right of use asset		557
Property and equipment, net		133
Other assets		42
Developed technology		9,268	10 years
Patents		2,703	10 years
Customer relationships		5,604	5 years
Tradenames and trademarks		3,294	7 years
Total assets acquired	$	34,627

Liabilities assumed:
Accounts payable	$	461
Accrued liabilities		911
Deferred revenues		2,534
Operating lease obligation, current		194
Operating lease obligation, noncurrent		384
Deferred tax liability		4,337
Total liabilities assumed		8,821
Goodwill	$	44,122

Measurement Period

The preliminary purchase price allocations for the acquisitions described above are based on initial estimates and provisional amounts. In accordance with ASC 805-10-25-13, if the initial accounting for a business combination is incomplete by the end of the reporting period in which the combination occurs, the acquirer shall report in its financial statements provisional amounts for the items for which the accounting is incomplete. During the measurement period, acquirer shall adjust the provisional amounts recognized at the acquisition date to reflect new information obtained about facts and circumstances that existed as of the acquisition date that, if known, would have affected the measurement of the amounts recognized as of that date. The Company continues to refine its inputs and estimates inherent in (i) the valuation of intangible assets, (ii) deferred income taxes, (iii) realization of tangible assets and (iv) the accuracy and completeness of liabilities. For the year ended December 31, 2023, the Company recognized a measurement period adjustment, which decreased prepaid assets and other current assets, developed technology, accounts payable and deferred tax liability by approximately $180 thousand, $571 thousand, $18 thousand and $137 thousand, respectively and increased accrued liabilities and goodwill by approximately $58 thousand and $671 thousand, respectively.

CXApp Pro Forma Financial Information

The following pro forma financial information presents the consolidated balance sheet and results of operations of the Company for the years ended December 31, 2023 and 2022 as if the acquisition had occurred as of the beginning of the first period presented (January 1, 2022). The pro forma information does not necessarily reflect the results of operations that would have occurred had the entities been a single company during those periods.

CXAPP INC. AND SUBSIDIARIES

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands)


	As of December 31,
	2023		2022
Assets
Current assets	$	9,029	$	8,798
Noncurrent assets		27,552		24,635
Total assets	$	36,581	$	33,433

Liabilities
Current liabilities	$	10,316	$	8,645
Noncurrent liabilities		867		1,197
Total liabilities	$	11,183	$	9,842

Stockholders’ equity	$	25,398	$	23,591
Total stockholders’ equity	$	25,398	$	23,591

Total liabilities and equity	$	36,581	$	33,433

CXAPP INC. AND SUBSIDIARIES

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND
COMPREHENSIVE INCOME (LOSS)

(in thousands)

	As of December 31,
	2023			2022
Revenues	$	7,366		$	8,470
Net loss	$	(57,904	)	$	(20,828	)

Software Development Costs, net

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Software Development Costs Net

Software Development Costs, net

NOTE 6 – Software Development Costs, net

Amortization expense for capitalized software development costs was approximately $209 thousand for the period from January 1, 2023, to March 14, 2023 (Predecessor). There was no amortization expense for capitalized software development costs for the three months ended March 31, 2024 (Successor) and for the period from March 15, 2023, to March 31, 2023 (Successor).

NOTE 6 – Software Development Costs, net

Capitalized software development costs consisted of the following (in thousands):


	Successor		Predecessor
	December 31, 2023		December 31, 2022
Capitalized software development costs	$	-	$	2,680
Accumulated amortization		-		(2,193	)
Software development costs, net	$	-	$	487

Amortization expense for capitalized software development costs was approximately $209 thousand and $527 thousand for the period from January 1, 2023, to March 14, 2023 (Predecessor) and for the year ended December 31, 2022 (Predecessor), respectively. There was no amortization expense for capitalized software development costs for the period from March 15, 2023, to December 31, 2023 (Successor).

Supplementary Financial Information

12 Months Ended

Dec. 31, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Supplementary Financial Information

NOTE 19 – Supplementary Financial Information

Quarterly Financial Information (unaudited)—The quarterly results for the years ended December 31, 2023 and 2022 are summarized below (in thousands, except per share amounts):


	Successor										Predecessor
2023	Fourth Quarter			Third Quarter		Second Quarter			Period from March 15, 2023, to March 31, 2023		Period from January 1, 2023, to March 14, 2023			Total
Net Revenue		1,719			1,770		1,915			342		1,620			7,366
Gross Profit		1,376			1,412		1,435			255		1,137			5,615
Net Income / (Loss)		(38,707	)		1,441		(14,730	)		2,758		(4,380	)		(42,580	)

Basic and diluted weighted average shares outstanding, Class A common stock		15,254,389			10,818,459		8,582,699			8,582,699		-			-
Basic and diluted net income (loss) per share, Class A common stock		(2.54	)		0.13		(1.05	)		0.20		-			-
Basic and diluted weighted average shares outstanding, Class C common stock		-			-		5,487,300			5,487,300		-			-
Basic and diluted net income (loss) per share, Class C common stock		-			-		(1.05	)		0.20		-			-

2022	Fourth Quarter			Third Quarter			Second Quarter			First Quarter			Total
Net Revenue		1,997			1,742			2,149			2,582			8,470
Gross Profit		1,561			1,243			1,609			1,993			6,406
Net Income / (Loss)		(5,541	)		(10,929	)		(11,034	)		(1,671	)		(29,175	)

Credit Risk and Concentrations (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Mar. 31, 2024
Successor [Member]
Concentration Risk [Line Items]
Cash	$ 300		$ 326
Revenue Benchmark [Member] \| Customer Concentration Risk [Member] \| Three Customers [Member]
Concentration Risk [Line Items]
Concentration Risk, Percentage	22.00%	27.00%
Revenue Benchmark [Member] \| Customer Concentration Risk [Member] \| One Customers [Member]
Concentration Risk [Line Items]
Concentration Risk, Percentage	12.00%	11.00%

- Definition

Amount of currency on hand as well as demand deposits with banks or financial institutions. Includes other kinds of accounts that have the general characteristics of demand deposits. Excludes cash and cash equivalents within disposal group and discontinued operation.

+ References + Details

Income Tax

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Income Tax Disclosure [Abstract]

Income Tax

NOTE 13 – Income Taxes

The Company recorded an income tax benefit of approximately $207 thousand and $1,560 thousand for the three months ended March 31, 2024 (Successor) and for the period from March 15, 2023, to March 31, 2023 (Successor), respectively. The Company did not incur income tax expense for the period from January 1, 2023, to March 14, 2023 (Predecessor).

The effective tax rate for three months ended March 31, 2024 (Successor) and for the period from March 15, 2023, to March 31, 2023 (Successor) was 3.85% and (164.0)%, respectively. The effective tax rate differs from the U.S. Federal statutory rate primarily due to recording a valuation allowance against deferred tax assets in the foreign jurisdictions and the significant permanent differences including impairment of goodwill and change in fair value of derivative warrant liabilities.

NOTE 14 – Income Tax

The Company’s net deferred tax assets/(liabilities) consisted of the effects of temporary differences attributable to the following:


	Successor			Predecessor
(In thousands)	December 31, 2023			December 31, 2022
Organizational costs/startup expenses	$	1,031		$	-
Deferred revenue		41			-
Section 174 - software development cost		1,097			-
Stock based compensation		164			549
Research credits		-			123
Other accruals		50			49
Fixed assets		-			22
Other		-			1,328
Net operating loss carryforward		2,202			17,038
Total deferred tax asset		4,585			19,109
Less: Valuation allowance		(871	)		(14,403	)

Deferred tax asset, net of valuation allowance	$	3,714		$	4,706

	Successor			Predecessor
	December 31, 2023			December 31, 2022
Intangibles	$	(4,338	)	$	(4,386	)
Property, plant & equipment		(13	)		(13	)
Other		-			(177	)
Capitalized research		-			(127	)
Total deferred tax liabilities		(4,351	)		(4,703	)

Net Deferred Tax Asset (Liability)	$	(637	)	$	3

The income tax provision consists of the following for the years ended December 31, 2023 and 2022:

Schedule of income tax provision
	Successor			Predecessor
	Period from March 15, 2023, to December 31, 2023			Period from January 1, 2023, to March 14, 2023			Year ended December 31, 2022
Foreign
Current	$	-		$	-		$	152
Deferred		-			4,054			(1,533	)

Federal
Current		(7	)		-			-
Deferred		(2,154	)		(637	)		(2,697	)

State and Local
Current		19			-			3
Deferred		(506	)		(273	)		(743	)
Total		(2,648	)		3,144			(4,818	)

Change in valuation allowance		(924	)		(3,144	)		4,971
Income tax expense/(benefit)	$	(3,572	)	$	-		$	153

As of December 31, 2023, the Company has U.S. federal and state net operating loss carryover of approximately $4,973 thousand and $4,776 thousand respectively. The federal NOLs generated till 2017-18 which if unutilized will expire by the year 2037 and the federal NOLs generated after 2018-19 will be carried forward indefinitely whereas the state NOLs if unutilized will expire based on the state statutes.

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. In assessing the realization of deferred tax assets, management considers, whether it is “more likely than not,” that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which temporary differences representing net future deductible amounts become deductible. Deferred income tax is presented under noncurrent liabilities and in other assets in the consolidated balance sheet as of December 31, 2023 and 2022, respectively.

In assessing the realization of the deferred tax assets, management considers whether it is more likely than not that some portion of all the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which temporary differences representing net future deductible amounts become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. After consideration of all the information available, management believes that it is more likely that the deferred tax assets will be realized in foreseeable future and has therefore recognized the entire opening valuation allowance of $924 thousand. For the period from March 15, 2023, to December 31, 2023 (Successor), for the period from January 1, 2023, to March 14, 2023 (Predecessor), and for the year ended December 31, 2022 (Predecessor), the change in valuation allowance was ($924) thousand, ($3,144) thousand, and $4,971 thousand, respectively.

The Company’s policy for recording interest and penalties associated with unrecognized tax benefits is to record such interest and penalties as interest expense and as a component of income tax expense. There were no amounts accrued for interest or penalties for the years ended December 31, 2023 and 2022. Management does not expect any material changes in its unrecognized tax benefits in the next year.

A reconciliation of the federal income tax rate to the Company’s effective tax rate for the years ended December 31, 2023 and 2022 are as follows:


	Successor			Predecessor
	Period from March 15, 2023, to December 31, 2023			Period from January 1, 2023, to March 14, 2023			Year ended December 31, 2022
Statutory federal income tax rate		21.00	%		21.00	%		21.00	%
Incentive stock options		-	%		(0.30	)%		(0.16	)%
Change in fair value of derivative warrant liabilities		(2.18	)%		-	%		-	%
Goodwill impairment loss		(14.34	)%		-	%		(4.00	)%
US-Foreign income tax rate difference		-	%		1.30	%		1.02	%
Permanent difference		0.22	%		0.07	%		(1.01	)%
Cancellation of debt income		-	%		(101.38	)%		-	%
Rate differential on foreign earnings		0.24	%		-	%		-	%
State taxes, net of federal tax benefit		0.93	%		3.49	%		2.01	%
Current federal tax true-up		0.01	%		-	%		-	%
Provision to return adjustments		-	%		-	%		(1.29	)%
Deferred only adjustment		-	%		4.80	%		(0.91	)%
Other		-	%		(0.35	)%		(0.06	)%
Valuation allowance		0.88	%		71.31	%		(17.13	)%
Income tax provision		6.76	%		-	%		(0.53	)%

The Company files income tax returns in the U.S. federal jurisdiction in various state and local jurisdictions as well as in foreign jurisdictions and is subject to examination by the various taxing authorities.

The Company recorded an income tax benefit of approximately $3,572 thousand for the period from March 15, 2023, to December 31, 2023 (Successor). The Company recorded an income tax expense of approximately $153 thousand for the year ended December 31, 2022 (Predecessor) and none for the period from January 1, 2023, to March 14, 2023 (Predecessor).

The effective tax rate for the year ended December 31, 2023 (Successor) was 6.76%. The income tax benefit for the year ended December 31, 2023 (Successor) is a result of the release of valuation allowance attributable to acquired intangible assets from the Business Combination. The effective tax rate differs from the U.S. Federal statutory rate primarily due to reversal of a valuation allowance on deferred tax assets, impairment of goodwill, and changes in fair value of warrant liabilities. The Company generated approximately $4,217 thousand of deferred tax liability associated with the Business Combination. As a result, the Company released its valuation allowance to the extent of such DTL (being source of taxable in future).

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480990/946-20-50-13

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(h)(2))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org//740/tableOfContent

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 14
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482685/740-10-50-14

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 21
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482685/740-10-50-21

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 270
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482526/740-270-50-1

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 17
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482685/740-10-50-17

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SAB TOPIC 6.I.5.Q1)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479360/740-10-S99-1

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 2
-Subparagraph (SAB Topic 11.C)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479360/740-10-S99-2

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 30
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482603/740-30-50-2

+ Details

Goodwill and Intangible Assets (Details 1) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
2024 (remainder of year)		$ 2,731
2025		2,731
2026		2,731
2027		2,731
2028		1,844
2029 and thereafter		5,368
Total		$ 18,136
Successor [Member]
2024 (remainder of year)	$ 2,048
2025	2,731
2026	2,731
2027	2,731
2028	1,844
2029 and thereafter	5,368
Total	$ 17,453

Summary of Significant Accounting Policies (Details 1) - Successor [Member] - USD ($) $ in Thousands	1 Months Ended	3 Months Ended				10 Months Ended
	Mar. 31, 2023	Mar. 31, 2024	Dec. 31, 2023	Sep. 30, 2023	Jun. 30, 2023	Dec. 31, 2023
Warrant liability at beginning	$ 2,649	$ 1,683	$ 2,103	$ 13,003	$ 963	$ 2,649
Change in FV of derivative instruments	(1,686)	1,472	(420)	(5,220)	12,040	4,714
FV of Warrants cash exercised and exchanged for Class A common stock (see Note 11 - Warrants)				(1,237)
Loss on warrant extinguishment				(3,894)
FV of Warrants cashless exercised for Class A common stock (see Note 11 - Warrants)				(549)
Warrant liability at ending	$ 963	$ 3,155	$ 1,683	$ 2,103	$ 13,003	$ 1,683

Promissory Note (Tables)

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Debt Disclosure [Abstract]

Promissory note

Promissory note
		March 31, 2024		December 31, 2023
Principal amount		$	3,885	$	3,885
Less:	Unamortized original issue discount		616		834
	Unamortized debt issuance cost		11		14
			3,258		3,037
Add:	Accrued interest payable		115		16
		$	3,373	$	3,053


(In thousands)
Principal amount		$	3,885
Less:	Unamortized original issue discount		834
	Unamortized debt issuance cost		14
		$	3,037
Add:	Accrued interest payable		16
		$	3,053

Disaggregation of Revenue (Tables)

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Disaggregation Of Revenue

Schedule of disaggregation of revenue

Schedule of disaggregation of revenue
	Successor				Predecessor
	Three Months Ended March 31, 2024		Period from March 15, 2023, to March 31, 2023		Period from January 1, 2023, to March 14, 2023
Subscription revenue
Software	$	1,588	$	240	$	1,204
Total subscription revenue	$	1,588	$	240	$	1,204

Non-subscription revenue
Professional services	$	230	$	102	$	416
Total non-subscription revenue		230	$	102	$	416

Total Revenue	$	1,818	$	342	$	1,620

	Successor				Predecessor
	Three Months Ended March 31, 2024		Period from March 15, 2023, to March 31, 2023		Period from January 1, 2023, to March 14, 2023
Revenue recognized over time⁽¹⁾⁽²⁾	$	1,818	$	342	$	1,620
Total	$	1,818	$	342	$	1,620

	(1)	Professional services are also contracted on the fixed fee and time and materials basis. Fixed fees are paid monthly, in phases, or upon acceptance of deliverables. The Company has generally elected the practical expedient to recognize revenue for the right to invoice because the Company’s right to consideration corresponds directly with the value to the customer of the performance completed to date.
	(2)	Software As A Service Subscription Revenue’s performance obligation is satisfied evenly over the service period using a time-based measure because the Company is providing continuous access to its service and service is recognized over time.

Schedule of disaggregation of revenue
	Successor		Predecessor
	Period from March 15, 2023, to December 31, 2023		Period from January 1, 2023, to March 14, 2023		Year ended December 31, 2022
Subscription revenue
Software	$	4,560	$	1,204	$	5,476
Total subscription revenue	$	4,560	$	1,204	$	5,476

Non-subscription revenue
Professional services	$	1,186	$	416	$	2,994
Total non-subscription revenue	$	1,186	$	416	$	2,994

Total revenue	$	5,746	$	1,620	$	8,470

	Successor		Predecessor
	Period from March 15, 2023, to December 31, 2023		Period from January 1, 2023, to March 14, 2023		Year ended December 31, 2022
Revenue recognized over time⁽¹⁾⁽²⁾	$	5,746	$	1,620	$	8,470
Total	$	5,746	$	1,620	$	8,470

	(1)	Professional services are also contracted on the fixed fee and time and materials basis. Fixed fees are paid monthly, in phases, or upon acceptance of deliverables. The Company has generally elected the practical expedient to recognize revenue for the right to invoice because the Company’s right to consideration corresponds directly with the value to the customer of the performance completed to date, in which revenue is recognized over time.
	(2)	Software As A Service Subscription Revenue’s performance obligation is satisfied evenly over the service period using a time-based measure because the Company is providing continuous access to its service and service is recognized over time.

Summary of Significant Accounting Policies (Details) - Successor [Member] - shares shares in Thousands	1 Months Ended	3 Months Ended	10 Months Ended
	Mar. 31, 2023	Mar. 31, 2024	Dec. 31, 2023
Total	25,457,000	23,255,065	22,838
Stock Options [Member]
Total	1,377,000	1,689,900	985
Restricted Stock Units (RSUs) [Member]
Total		533,165	821
Warrant [Member]
Total	24,080,000	21,032,000	21,032

Credit Risk and Concentrations

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Risks and Uncertainties [Abstract]

Credit Risk and Concentrations

NOTE 14 – Credit Risk and Concentrations

Financial instruments that subject the Company to credit risk consist principally of trade accounts receivable and cash and cash equivalents. The Company performs certain credit evaluation procedures and does not require collateral for financial instruments subject to credit risk. The Company believes that credit risk is limited because the Company routinely assesses the financial strength of its customers and, based upon factors surrounding the credit risk of its customers, establishes an allowance for credit losses and, consequently, believes that its accounts receivable credit risk exposure beyond such allowances is limited.

The Company maintains cash deposits with financial institutions, which, from time to time, may exceed federally insured limits. Any loss incurred or a lack of access to such funds could have a significant adverse impact on the Company’s financial condition, results of operations, and cash flows. Cash is also maintained at foreign financial institutions for its Canadian and Philippines subsidiaries and its majority-owned India subsidiary. Cash in foreign financial institutions as of March 31, 2024 (Successor) was $326 thousand. Cash in foreign financial institutions as of December 31, 2023 (Successor) was $300 thousand. The Company has not experienced any losses and believes it is not exposed to any significant credit risk from cash for the three months ended March 31, 2024 (Successor), for the period from March 15, 2023, to March 31, 2023 (Successor), and for the period from January 1, 2023, to March 14, 2023 (Predecessor). However, any loss incurred or lack of access to such funds could have a significant impact on the Company’s financial condition, results of operations, and cash flows.

NOTE 15 – Credit Risk and Concentrations

The Company maintains cash deposits with financial institutions, which, from time to time, may exceed federally insured limits. Any loss incurred or a lack of access to such funds could have a significant adverse impact on the Company’s financial condition, results of operations, and cash flows. Cash is also maintained at foreign financial institutions for its Canadian and Philippines subsidiaries. Cash in foreign financial institutions as of December 31, 2023 (Successor) was $300 thousand. Cash in foreign financial institutions as of December 31, 2022 (Predecessor) was not significant. The Company has not experienced any losses and believes it is not exposed to any significant credit risk from cash. However, any loss incurred or lack of access to such funds could have a significant impact on the Company’s financial condition, results of operations, and cash flows.

Our top three customers accounted for approximately 22% and 27% of our gross revenue during the years ended December 31, 2023 and 2022, respectively. One customer accounted for 12% of our gross revenue in 2023, and a separate customer accounted for 11% of our gross revenue in 2022; however, each of these customers may or may not continue to be a significant contributor to revenue in 2024. The loss of a significant amount of business from one of our major customers would materially and adversely affect our results of operations until such time, if ever, as we are able to replace the lost business. Significant customers or projects in any one period may not continue to be significant customers or projects in other periods. To the extent that we are dependent on any single customer, we are subject to the risks faced by that customer to the extent that such risks impede the customer’s ability to stay in business and make timely payments to us.

Foreign Operations (Details) - USD ($) $ in Thousands	1 Months Ended	2 Months Ended	3 Months Ended	10 Months Ended	12 Months Ended
Foreign Operations (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Mar. 14, 2023	Mar. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Successor [Member]
Revenues by geographic area	$ 342		$ 1,818	$ 5,746
Operating income (loss) by geographic area	(487)		(3,587)	(48,208)
Net income (loss) by geographic area	2,758		(5,170)	(49,238)
Identifiable assets by geographic area			34,557	36,581
Long lived assets by geographic area			17,937	18,737
Goodwill by geographic area			8,737	8,737
Successor [Member] \| UNITED STATES
Revenues by geographic area	272		1,667	4,838
Operating income (loss) by geographic area	(486)		(3,000)	(46,018)
Net income (loss) by geographic area	2,780		(4,527)	(47,073)
Identifiable assets by geographic area			36,681	38,143
Long lived assets by geographic area			17,533	18,269
Goodwill by geographic area			8,737	8,737
Successor [Member] \| CANADA
Revenues by geographic area	70		151	908
Operating income (loss) by geographic area	(158)		(602)	(2,380)
Net income (loss) by geographic area	(158)		(657)	(2,332)
Identifiable assets by geographic area			600	627
Long lived assets by geographic area			282	320
Goodwill by geographic area
Successor [Member] \| INDIA
Revenues by geographic area
Operating income (loss) by geographic area
Net income (loss) by geographic area
Identifiable assets by geographic area
Long lived assets by geographic area
Goodwill by geographic area
Successor [Member] \| PHILIPPINES
Revenues by geographic area	196		240	884
Operating income (loss) by geographic area	157		15	190
Net income (loss) by geographic area	157		14	188
Identifiable assets by geographic area			445	434
Long lived assets by geographic area			122	148
Goodwill by geographic area
Successor [Member] \| Eliminations [Member]
Revenues by geographic area	(196)		(240)	(884)
Operating income (loss) by geographic area
Net income (loss) by geographic area	$ (21)			(21)
Identifiable assets by geographic area			(3,169)	(2,623)
Long lived assets by geographic area
Goodwill by geographic area
Predecessor [Member]
Revenues by geographic area		1,620			$ 8,470
Operating income (loss) by geographic area		(4,381)			(29,025)
Net income (loss) by geographic area		(4,380)			(29,175)
Identifiable assets by geographic area					29,280
Long lived assets by geographic area					20,659
Goodwill by geographic area
Predecessor [Member] \| UNITED STATES
Revenues by geographic area		1,395			7,011
Operating income (loss) by geographic area		(3,479)			(22,358)
Net income (loss) by geographic area		(3,342)			(21,774)
Identifiable assets by geographic area					24,591
Long lived assets by geographic area					15,558
Goodwill by geographic area
Predecessor [Member] \| CANADA
Revenues by geographic area		285			2,061
Operating income (loss) by geographic area		(905)			(7,163)
Net income (loss) by geographic area		(1,041)			(7,769)
Identifiable assets by geographic area					5,484
Long lived assets by geographic area					4,788
Goodwill by geographic area
Predecessor [Member] \| INDIA
Revenues by geographic area					1,345
Operating income (loss) by geographic area					569
Net income (loss) by geographic area					467
Identifiable assets by geographic area					228
Long lived assets by geographic area					98
Goodwill by geographic area
Predecessor [Member] \| PHILIPPINES
Revenues by geographic area		160			166
Operating income (loss) by geographic area		3			(96)
Net income (loss) by geographic area		3			(99)
Identifiable assets by geographic area					415
Long lived assets by geographic area					215
Goodwill by geographic area
Predecessor [Member] \| Eliminations [Member]
Revenues by geographic area		(220)			(2,113)
Operating income (loss) by geographic area					23
Net income (loss) by geographic area
Identifiable assets by geographic area					(1,438)
Long lived assets by geographic area
Goodwill by geographic area

Supplementary Financial Information (Tables)

12 Months Ended

Dec. 31, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of supplementary financial information


	Successor										Predecessor
2023	Fourth Quarter			Third Quarter		Second Quarter			Period from March 15, 2023, to March 31, 2023		Period from January 1, 2023, to March 14, 2023			Total
Net Revenue		1,719			1,770		1,915			342		1,620			7,366
Gross Profit		1,376			1,412		1,435			255		1,137			5,615
Net Income / (Loss)		(38,707	)		1,441		(14,730	)		2,758		(4,380	)		(42,580	)

Basic and diluted weighted average shares outstanding, Class A common stock		15,254,389			10,818,459		8,582,699			8,582,699		-			-
Basic and diluted net income (loss) per share, Class A common stock		(2.54	)		0.13		(1.05	)		0.20		-			-
Basic and diluted weighted average shares outstanding, Class C common stock		-			-		5,487,300			5,487,300		-			-
Basic and diluted net income (loss) per share, Class C common stock		-			-		(1.05	)		0.20		-			-

2022	Fourth Quarter			Third Quarter			Second Quarter			First Quarter			Total
Net Revenue		1,997			1,742			2,149			2,582			8,470
Gross Profit		1,561			1,243			1,609			1,993			6,406
Net Income / (Loss)		(5,541	)		(10,929	)		(11,034	)		(1,671	)		(29,175	)

Income Tax (Details Narrative) - USD ($) $ in Thousands	1 Months Ended	2 Months Ended	3 Months Ended	10 Months Ended	12 Months Ended
Income Tax (Details Narrative) - USD ($) $ in Thousands	Mar. 31, 2023	Mar. 14, 2023	Mar. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Operating loss carryforwards federal				$ 4,973
Operating loss carryforwards state				4,776
Successor [Member]
Valuation allowance				(924)
Income tax benefit/(provision)	$ 1,560		$ 207	$ 3,572
Effective tax rate			3.85%	6.76%
Deferred tax liability				$ 4,217
Predecessor [Member]
Valuation allowance		$ (3,144)			$ 4,971
Income tax benefit/(provision)		$ 0			$ 153
Effective tax rate	(164.00%)				(0.53%)
Deferred tax liability		$ 4,217

Commitments and Contingencies

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Commitments and Contingencies

Commitments and Contingencies

NOTE 17 – Commitments and Contingencies

Risks and Uncertainties

Various social and political circumstances in the United States and around the world (including wars and other forms of conflict, including rising trade tensions between the United States and China, and other uncertainties regarding actual and potential shifts in the United States and foreign, trade, economic and other policies with other countries, terrorist acts, security operations and catastrophic events such as fires, floods, earthquakes, tornadoes, hurricanes and global health epidemics) may also contribute to increased market volatility and economic uncertainties or deterioration in the United States and worldwide. Specifically, the rising conflict between Russia and Ukraine, and resulting market volatility could adversely affect the Company’s ability to complete a Business Combination. In response to the conflict between Russia and Ukraine, the United States and other countries have imposed sanctions or other restrictive actions against Russia. Any of the above factors, including sanctions, export controls, tariffs, trade wars and other governmental actions, could have a material adverse effect on the Company’s ability to complete a Business Combination and the value of the Company’s securities.

Management continues to evaluate the impact of these types of risks and has concluded that while it is reasonably possible that these risks and uncertainties could have a negative effect on the Company’s financial position, results of its operations and/or search for a target company, the specific impact is not readily determinable as of the date of these condensed consolidated financial statements. The condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Litigation

Certain conditions may exist as of the date the financial statements are issued which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company, or unasserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or unasserted claims, as well as the perceived merits of the amount of relief sought or expected to be sought therein.

If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s financial statements. If the assessment indicates that a potentially material loss contingency is not probable, but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability and an estimate of the range of possible losses, if determinable and material, would be disclosed.

Loss contingencies considered remote are generally not disclosed, unless they involve guarantees, in which case the guarantees would be disclosed. There can be no assurance that such matters will not materially and adversely affect the Company’s business, financial position, and results of operations or cash flows.

NOTE 18 – Commitments and Contingencies

Risks and Uncertainties

Various social and political circumstances in the United States and around the world (including wars and other forms of conflict, including rising trade tensions between the United States and China, and other uncertainties regarding actual and potential shifts in the United States and foreign, trade, economic and other policies with other countries, terrorist acts, security operations and catastrophic events such as fires, floods, earthquakes, tornadoes, hurricanes and global health epidemics) may also contribute to increased market volatility and economic uncertainties or deterioration in the United States and worldwide. Specifically, the rising conflict between Russia and Ukraine, and resulting market volatility could adversely affect the value of the Company’s securities. In response to the conflict between Russia and Ukraine, the United States and other countries have imposed sanctions or other restrictive actions against Russia. Any of the above factors, including sanctions, export controls, tariffs, trade wars and other governmental actions, could have a material adverse effect on the value of the Company’s securities.

Management continues to evaluate the impact of these types of risks and has concluded that while it is reasonably possible that these risks and uncertainties could have a negative effect on the Company’s financial position and results of its operations, the specific impact is not readily determinable as of the date of these consolidated financial statements. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Litigation

Goodwill and Intangible Assets, net (Details 2) $ in Thousands	Dec. 31, 2023 USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]
2024	$ 2,731
2025	2,731
2026	2,731
2027	2,731
2028	1,844
2029 and thereafter	5,368
Total	$ 18,136

Business Combination (Details 1) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
Business Combination (Details 1) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2023	Dec. 31, 2022
Risks and Uncertainties [Abstract]
Revenues	$ 1,962	$ 7,366	$ 8,470
Net loss	$ (6,365)	$ (57,904)	$ (20,828)

Supplementary Financial Information (Details) - USD ($) $ / shares in Units, $ in Thousands	1 Months Ended	2 Months Ended	3 Months Ended								10 Months Ended	12 Months Ended
	Mar. 31, 2023	Mar. 14, 2023	Mar. 31, 2024	Dec. 31, 2023	Sep. 30, 2023	Jun. 30, 2023	Dec. 31, 2022	Sep. 30, 2022	Jun. 30, 2022	Mar. 31, 2022	Dec. 31, 2023	Dec. 31, 2023	Dec. 31, 2022
Net Revenue												$ 7,366
Gross Profit												5,615
Net Income / (Loss)												$ (42,580)
Successor [Member]
Net Revenue	$ 342			$ 1,719	$ 1,770	$ 1,915
Gross Profit	255		$ 1,491	1,376	1,412	1,435					$ 4,478
Net Income / (Loss)	$ 2,758			$ (38,707)	$ 1,441	$ (14,730)
Successor [Member] \| Class A Common Stock [Member]
Basic weighted average shares outstanding	8,582,699			15,254,389	10,818,459	8,582,699
Diluted weighted average shares outstanding	8,582,699			15,254,389	10,818,459	8,582,699
Basic net income (loss) per share	$ 0.20			$ (2.54)	$ 0.13	$ (1.05)
Diluted net income (loss) per share	$ 0.20			$ (2.54)	$ 0.13	$ (1.05)
Successor [Member] \| Class C Common Stock [Member]
Basic weighted average shares outstanding	5,487,300					5,487,300
Diluted weighted average shares outstanding	5,487,300					5,487,300
Basic net income (loss) per share	$ 0.20					$ (1.05)
Diluted net income (loss) per share	$ 0.20					$ (1.05)
Predecessor [Member]
Net Revenue		$ 1,620					$ 1,997	$ 1,742	$ 2,149	$ 2,582			$ 8,470
Gross Profit		1,137					1,561	1,243	1,609	1,993			6,406
Net Income / (Loss)		$ (4,380)					$ (5,541)	$ (10,929)	$ (11,034)	$ (1,671)			$ (29,175)

Stock Option Plan and Stock-Based Compensation (Details 2) - Successor [Member]	3 Months Ended	10 Months Ended
	Mar. 31, 2024	Dec. 31, 2023
Finite-Lived Intangible Assets [Line Items]
Risk-free interest rate		3.67%
Expected life of option grants		5 years 9 months
Expected volatility of underlying stock	61.65%	61.65%
Dividends assumption		(0.00%)
Minimum [Member]
Finite-Lived Intangible Assets [Line Items]
Risk-free interest rate	3.67%
Expected life of option grants	5 years 9 months
Maximum [Member]
Finite-Lived Intangible Assets [Line Items]
Risk-free interest rate	4.03%
Expected life of option grants	6 years 3 months

Income Taxes

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Income Tax Disclosure [Abstract]

Income Taxes

NOTE 13 – Income Taxes

NOTE 14 – Income Tax

The Company’s net deferred tax assets/(liabilities) consisted of the effects of temporary differences attributable to the following:


	Successor			Predecessor
(In thousands)	December 31, 2023			December 31, 2022
Organizational costs/startup expenses	$	1,031		$	-
Deferred revenue		41			-
Section 174 - software development cost		1,097			-
Stock based compensation		164			549
Research credits		-			123
Other accruals		50			49
Fixed assets		-			22
Other		-			1,328
Net operating loss carryforward		2,202			17,038
Total deferred tax asset		4,585			19,109
Less: Valuation allowance		(871	)		(14,403	)

Deferred tax asset, net of valuation allowance	$	3,714		$	4,706

	Successor			Predecessor
	December 31, 2023			December 31, 2022
Intangibles	$	(4,338	)	$	(4,386	)
Property, plant & equipment		(13	)		(13	)
Other		-			(177	)
Capitalized research		-			(127	)
Total deferred tax liabilities		(4,351	)		(4,703	)

Net Deferred Tax Asset (Liability)	$	(637	)	$	3

The income tax provision consists of the following for the years ended December 31, 2023 and 2022:

Schedule of income tax provision
	Successor			Predecessor
	Period from March 15, 2023, to December 31, 2023			Period from January 1, 2023, to March 14, 2023			Year ended December 31, 2022
Foreign
Current	$	-		$	-		$	152
Deferred		-			4,054			(1,533	)

Federal
Current		(7	)		-			-
Deferred		(2,154	)		(637	)		(2,697	)

State and Local
Current		19			-			3
Deferred		(506	)		(273	)		(743	)
Total		(2,648	)		3,144			(4,818	)

Change in valuation allowance		(924	)		(3,144	)		4,971
Income tax expense/(benefit)	$	(3,572	)	$	-		$	153

A reconciliation of the federal income tax rate to the Company’s effective tax rate for the years ended December 31, 2023 and 2022 are as follows:


	Successor			Predecessor
	Period from March 15, 2023, to December 31, 2023			Period from January 1, 2023, to March 14, 2023			Year ended December 31, 2022
Statutory federal income tax rate		21.00	%		21.00	%		21.00	%
Incentive stock options		-	%		(0.30	)%		(0.16	)%
Change in fair value of derivative warrant liabilities		(2.18	)%		-	%		-	%
Goodwill impairment loss		(14.34	)%		-	%		(4.00	)%
US-Foreign income tax rate difference		-	%		1.30	%		1.02	%
Permanent difference		0.22	%		0.07	%		(1.01	)%
Cancellation of debt income		-	%		(101.38	)%		-	%
Rate differential on foreign earnings		0.24	%		-	%		-	%
State taxes, net of federal tax benefit		0.93	%		3.49	%		2.01	%
Current federal tax true-up		0.01	%		-	%		-	%
Provision to return adjustments		-	%		-	%		(1.29	)%
Deferred only adjustment		-	%		4.80	%		(0.91	)%
Other		-	%		(0.35	)%		(0.06	)%
Valuation allowance		0.88	%		71.31	%		(17.13	)%
Income tax provision		6.76	%		-	%		(0.53	)%

- Definition

+ References

+ Details

Foreign Operations

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Foreign Operations

Foreign Operations

NOTE 15 – Foreign Operations

The Company’s operations are located primarily in the United States, Canada, and the Philippines. Revenues by geographic area are attributed by country of domicile of the Company’s subsidiaries. The financial data by geographic area are as follows (in thousands):


	United States			Canada			Philippines		Eliminations			Total
For the Three Months Ended March 31, 2024 (Successor):
Revenues by geographic area	$	1,667		$	151		$	240	$	(240	)	$	1,818
Operating income (loss) by geographic area	$	(3,000	)	$	(602	)	$	15	$	-		$	(3,587	)
Net income (loss) by geographic area	$	(4,527	)	$	(657	)	$	14	$	-		$	(5,170	)


For the Period from January 1, 2023, to March 14, 2023 (Predecessor):
Revenues by geographic area	$	1,395		$	285		$	160	$	(220	)	$	1,620
Operating income (loss) by geographic area	$	(3,479	)	$	(905	)	$	3	$	-		$	(4,381	)
Net income (loss) by geographic area	$	(3,342	)	$	(1,041	)	$	3	$	-		$	(4,380	)

For the Period from March 15, 2023, to March 31, 2023 (Successor):
Revenues by geographic area	$	272		$	70		$	196	$	(196	)	$	342
Operating income (loss) by geographic area	$	(486	)	$	(158	)	$	157	$	-		$	(487	)
Net income (loss) by geographic area	$	2,780		$	(158	)	$	157	$	(21	)	$	2,758

As of March 31, 2024 (Successor)
Identifiable assets by geographic area	$	36,681		$	600		$	445	$	(3,169	)	$	34,557
Long lived assets by geographic area	$	17,533		$	282		$	122	$	-		$	17,937
Goodwill by geographic area	$	8,737		$	-		$	-	$	-		$	8,737


As of December 31, 2023 (Successor)
Identifiable assets by geographic area	$	38,143		$	627		$	434	$	(2,623	)	$	36,581
Long lived assets by geographic area	$	18,269		$	320		$	148	$	-		$	18,737
Goodwill by geographic area	$	8,737		$	-		$	-	$	-		$	8,737

NOTE 16 – Foreign Operations


	United States			Canada			India		Philippines			Eliminations			Total
For the Period from March 15, 2023, to December 31, 2023 (Successor):
Revenues by geographic area	$	4,838		$	908		$	-	$	884		$	(884	)	$	5,746
Operating income (loss) by geographic area	$	(46,018	)	$	(2,380	)	$	-	$	190		$	-		$	(48,208	)
Net income (loss) by geographic area	$	(47,073	)	$	(2,332	)	$	-	$	188		$	(21	)	$	(49,238	)


For the Period from January 1, 2023, to March 14, 2023 (Predecessor):
Revenues by geographic area	$	1,395		$	285		$	-	$	160		$	(220	)	$	1,620
Operating income (loss) by geographic area	$	(3,479	)	$	(905	)	$	-	$	3		$	-		$	(4,381	)
Net income (loss) by geographic area	$	(3,342	)	$	(1,041	)	$	-	$	3		$	-		$	(4,380	)

For the Year Ended December 31, 2022 (Predecessor):
Revenues by geographic area	$	7,011		$	2,061		$	1,345	$	166		$	(2,113	)	$	8,470
Operating income (loss) by geographic area	$	(22,358	)	$	(7,163	)	$	569	$	(96	)	$	23		$	(29,025	)
Net income (loss) by geographic area	$	(21,774	)	$	(7,769	)	$	467	$	(99	)	$	-		$	(29,175	)

As of December 31, 2023 (Successor)
Identifiable assets by geographic area	$	38,143		$	627		$	-	$	434		$	(2,623	)	$	36,581
Long lived assets by geographic area	$	18,269		$	320		$	-	$	148		$	-		$	18,737
Goodwill by geographic area	$	8,737		$	-		$	-	$	-		$	-		$	8,737

As of December 31, 2022 (Predecessor)
Identifiable assets by geographic area	$	24,591	$	5,484	$	228	$	415	$	(1,438	)	$	29,280
Long lived assets by geographic area	$	15,558	$	4,788	$	98	$	215	$	-		$	20,659
Goodwill by geographic area	$	-	$	-	$	-	$	-	$	-		$	-

Warrants

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Warrants

Warrants

NOTE 11 – Warrants

Public Warrants

As of March 31, 2024 (Successor) there were 10,751,862 public warrants outstanding. Each whole warrant entitles the holder thereof to purchase one share of the Company’s Class A common stock at a price of $11.50 per share, subject to adjustments described in the Company’s registration statement on Form S-1 (Registration No. 333-249177) filed in connection with its initial public offering.

The public warrants is exercisable and will expire on March 15, 2028, or earlier upon redemption or liquidation. public warrants may only be exercised for a whole number of shares. No fractional warrants will be issued upon separation of the units and only whole warrants will trade.

The Company will not be obligated to deliver any shares of Class A common stock pursuant to the exercise of a warrant and will have no obligation to settle such warrant exercise unless a registration statement under the Securities Act covering the issuance of the shares of Class A common stock underlying the warrants is then effective and a prospectus relating thereto is current, subject to the Company satisfying its obligations with respect to registration. No warrant will be exercisable, and the Company will not be obligated to issue shares of Class A common stock upon exercise of a warrant unless Class A common stock issuable upon such warrant exercise has been registered, qualified or deemed to be exempt under the securities laws of the state of residence of the registered holder of the warrants.

On July 13, 2023, warrant holders exercised 435,000 public warrants at an exercise price of $11.50, for a total of $5,002 thousand of cash proceeds to the Company.

On July 14, 2023, the Company entered into a Warrant Exchange Agreement (the “Agreement”) with an unaffiliated third-party investor (the “Warrant Holder”) with respect to warrants to purchase an aggregate of 2,000 thousand shares of its common stock, par value $0.0001 per share (the “common stock”) initially issued by the Company in its initial public offering on December 15, 2020 (the “public warrants”). Pursuant to the Agreement, the Company issued an aggregate of 600 thousand shares of common stock to the Warrant Holder in exchange for the surrender and cancellation of the public warrants held by such holder. This resulted to an additional paid in capital of $4,914 thousand in a non-cash transaction and resulted in a $3,900 thousand loss on the warrant conversion, which is included in change in fair value of derivative liability in the statement of operations.

For the three months ended September 30, 2023, about 613 thousand public warrants to purchase Class A common stock were exercised on a cashless basis for approximately 50 thousand shares of common stock and are no longer outstanding.

Private Warrants

As of March 31, 2024 (Successor) and December 31, 2023 (Successor), there were 10,280 thousand and 10,280 thousand private placement warrants outstanding. The private placement warrants are identical to the public warrants, except that the private placement warrants and the shares of Class A common stock issuable upon the exercise of the private placement warrants will not be transferable, assignable or salable until April 14, 2023, subject to certain limited exceptions. Additionally, the private placement warrants will be exercisable on a cashless basis and be non-redeemable, except as described above, so long as they are held by the initial purchasers or their permitted transferees. If the private placement warrants are held by someone other than the initial purchasers or their permitted transferees, the private placement warrants will be redeemable by the Company and exercisable by such holders on the same basis as the public warrants.

NOTE 11 – Warrants

Public Warrants

As of December 31, 2023, there were 10,752 thousand public warrants outstanding, and none as of December 31, 2022. Each whole warrant entitles the holder thereof to purchase one share of the Company’s Class A common stock at a price of $11.50 per share, subject to adjustments described in the Company’s registration statement on Form S-1 (Registration No. 333-249177) filed in connection with its initial public offering.

On July 13, 2023, warrant holders exercised 435 thousand public warrants at an exercise price of $11.50, for a total of $5,002 thousand of cash proceeds to the Company.

On July 14, 2023, the Company entered into a Warrant Exchange Agreement (the “Agreement”) with third-party investor (the “Warrant Holder”) with respect to warrants to purchase an aggregate of 2,000 thousand shares of its common stock, par value $0.0001 per share (the “common stock”) initially issued by the Company in its initial public offering on December 15, 2020 (the “public warrants”). Pursuant to the Agreement, the Company issued an aggregate of 600 thousand shares of common stock to the Warrant Holder in exchange for the surrender and cancellation of the public warrants held by such holder. This resulted in an additional paid in capital of $4,914 thousand in a non-cash transaction and resulted in a $3,900 thousand loss on the warrant conversion, which is included in change in fair value of derivative liability in the statement of operations.

For the quarter ended September 30, 2023, about 613 thousand public warrants to purchase Class A common stock were exercised on a cashless basis for approximately 50 thousand shares of common stock and are no longer outstanding.

Private Warrants

As of December 31, 2023, there were 10,280 thousand private placement warrants outstanding and none as of December 31, 2022. The private placement warrants are identical to the public warrants, except that the private placement warrants and the shares of Class A common stock issuable upon the exercise of the private placement warrants will not be transferable, assignable or salable until 30 days after the completion of a Business Combination, subject to certain limited exceptions. Additionally, the private placement warrants will be exercisable on a cashless basis and be non-redeemable, except as described above, so long as they are held by the initial purchasers or their permitted transferees. If the private placement warrants are held by someone other than the initial purchasers or their permitted transferees, the private placement warrants will be redeemable by the Company and exercisable by such holders on the same basis as the public warrants.

Public and private warrant exercise activity and underlying common stock issued or surrendered for the year ended December 31, 2023, is:


	Public Warrants			Private Warrants		Total
January 1, 2023		13,800,000			10,280,000		24,080,000
Warrants exchanged and exercised – cash		(2,435,000	)		-		(2,435,000	)
Warrants exercised – cashless		(613,138	)		-		(613,138	)
December 31, 2023		10,751,862			10,280,000		21,031,862

Leases (Details) - Successor [Member] - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Year 2024	$ 197	$ 315
Year 2025	174	177
Year 2026	59	60
Total lease payments	430	552
Less: Imputed interest	(39)	(47)
Present value of lease liabilities	$ 391	$ 505

Leases (Details Narrative) - USD ($) $ in Thousands	1 Months Ended	2 Months Ended	3 Months Ended	10 Months Ended	12 Months Ended
Leases (Details Narrative) - USD ($) $ in Thousands	Mar. 31, 2023	Mar. 14, 2023	Mar. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Successor [Member]
Operating lease expenses	$ 9		$ 113	$ 345
Weighted average remaining lease term			1 year 1 month 6 days	1 year 4 months 24 days
Weighted average discount rate used to determine operating lease			8.00%	8.00%
Predecessor [Member]
Operating lease expenses		$ 57			$ 681
Weighted average remaining lease term					2 years 9 months 25 days
Weighted average discount rate used to determine operating lease					8.00%

Common Stock

12 Months Ended

Dec. 31, 2023

Equity [Abstract]

Common Stock

NOTE 13 – Common Stock

In March 2023, the Company issued 100,000 shares of Class A common stock as a compensation to BTIG, LLC (BTIG) for a one-year strategic and capital markets advisory services to be provided to the Company effective on the business day following the Business Combination. During the period March 15, 2023, to December 31, 2023, the Company recorded compensation amounted to $155 thousand which is included in the general and administrative expenses of the consolidated statements of operations and comprehensive loss and in the consolidated statements of cash flows as stock-based compensation.

Following the Business Combination, the Company’s Class C common stock is subject to transfer restrictions and will automatically convert into the Company’s Class A common stock on the earlier to occur of (i) the 180th day following the closing of the Merger and (ii) the day that the last reported sale price of the New CXApp Class A common stock equals or exceeds $12.00 per share for any 20 trading days within any 30-trading day period following the closing of the Merger.

On September 10, 2023, the Company’s 5,487,300 shares of Class C common stock were automatically converted into an aggregate of 5,487,300 shares of the Company’s Class A common stock, par value $0.0001 per share.

- Definition

The entire disclosure for equity.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (h)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 14
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-14

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 235
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481062/946-235-50-2

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 235
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481062/946-235-50-2

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 505
-Name Accounting Standards Codification
-Section 50
-Paragraph 6
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481004/946-505-50-6

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 815
-SubTopic 40
-Name Accounting Standards Codification
-Section 50
-Paragraph 6
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480237/815-40-50-6

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.3-04)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480008/505-10-S99-1

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(e)(1))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1

Reference 10: http://fasb.org/us-gaap/role/ref/legacyRef
-Topic 505
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org//505/tableOfContent

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (g)
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-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (i)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 14
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-14

Reference 15: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
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Reference 16: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
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-Name Accounting Standards Codification
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Reference 17: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-18

Reference 18: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
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-Name Accounting Standards Codification
-Section 50
-Paragraph 18
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-18

Reference 19: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
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-Name Accounting Standards Codification
-Section 50
-Paragraph 18
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-18

+ Details

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	2 Months Ended	10 Months Ended	12 Months Ended
	Mar. 14, 2023	Dec. 31, 2023	Dec. 31, 2022
Successor [Member]
Operating activities
Net loss		$ (49,238)
Adjustments to reconcile net loss to net cash used in operating activities
Depreciation and amortization		75
Amortization of intangible assets		2,162
Amortization of right of use asset		298
Amortization of debt discount and deferred financing cost		37
Accrued interest expense on promissory note		16
Deferred income taxes		(3,570)
Provision for credit loss expense		(11)
Stock-based compensation expense		1,080
Gain on change in fair value of earnout payable
(Gain) loss on foreign currency transactions		(44)
Change in fair value of derivative liability		4,714
Impairment of goodwill		36,056
Unrealized loss on note
Others
Change in operating assets and liabilities:
Accounts receivable and other receivables		300
Prepaid expenses and other current assets		719
Inventory
Other assets		(37)
Accounts payable		499
Accrued liabilities		(5,876)
Income tax liabilities
Operating lease liabilities		(306)
Deferred revenue		360
Net cash used in operating activities		(12,766)
Investing activities
Purchases of property and equipment		(57)
Investment in capitalized software
Cash acquired in connection with Business Combination		10,003
Net cash provided by (used in) investing activities		9,946
Financing activities
Net equity investment from parent
Taxes paid related to stock based compensation
Repayment of CXApp acquisition liability
Net proceeds from issuance of promissory note		3,000
Repayment of related party promissory note		(328)
Warrant exercise - net		4,948
Net cash provided by financing activities		7,620
Effect of exchange rate changes on cash and cash equivalents		(28)
Net increase in cash and cash equivalents		4,772
Cash and cash equivalents, beginning of period		1,503
Cash and cash equivalents, end of period	$ 1,503	6,275
Supplemental disclosures of cash flow information
Cash paid for taxes		4
Cash paid for interest		18
Supplemental schedule of noncash investing and financing activities
Right of use asset obtained in exchange for lease liability		230
Parent’s net equity issued for CXApp earnout
Noncash investment from parent
Class A Common Stock and Class C Common Stock issued in connection with Business Combination		69,928
Financing of Director and Officer Insurance		671
Warrant exercise – cashless		549
Warrant exchange to Class A common stock		4,914
Predecessor [Member]
Operating activities
Net loss	(4,380)		$ (29,175)
Adjustments to reconcile net loss to net cash used in operating activities
Depreciation and amortization	228		646
Amortization of intangible assets	806		3,885
Amortization of right of use asset	40		266
Amortization of debt discount and deferred financing cost
Accrued interest expense on promissory note
Deferred income taxes
Provision for credit loss expense			5
Stock-based compensation expense	158		1,640
Gain on change in fair value of earnout payable			(2,827)
(Gain) loss on foreign currency transactions	(32)
Change in fair value of derivative liability
Impairment of goodwill	(0)		5,540
Unrealized loss on note			1,478
Others			(500)
Change in operating assets and liabilities:
Accounts receivable and other receivables	(857)		109
Prepaid expenses and other current assets	(20)		109
Inventory			117
Other assets			18
Accounts payable	(796)		400
Accrued liabilities	(787)		1,096
Income tax liabilities			(513)
Operating lease liabilities	(38)		(257)
Deferred revenue	534		(932)
Net cash used in operating activities	(5,144)		(18,895)
Investing activities
Purchases of property and equipment	(9)		(88)
Investment in capitalized software	(45)		(394)
Cash acquired in connection with Business Combination
Net cash provided by (used in) investing activities	(54)		(482)
Financing activities
Net equity investment from parent	9,089		25,967
Taxes paid related to stock based compensation			(104)
Repayment of CXApp acquisition liability	(197)		(5,135)
Net proceeds from issuance of promissory note
Repayment of related party promissory note
Warrant exercise - net
Net cash provided by financing activities	8,892		20,728
Effect of exchange rate changes on cash and cash equivalents	1		(71)
Net increase in cash and cash equivalents	3,695		1,280
Cash and cash equivalents, beginning of period	6,308	$ 10,003	5,028
Cash and cash equivalents, end of period	10,003		6,308
Supplemental disclosures of cash flow information
Cash paid for taxes			119
Cash paid for interest			1
Supplemental schedule of noncash investing and financing activities
Right of use asset obtained in exchange for lease liability			284
Parent’s net equity issued for CXApp earnout			3,697
Noncash investment from parent	409
Class A Common Stock and Class C Common Stock issued in connection with Business Combination
Financing of Director and Officer Insurance
Warrant exercise – cashless
Warrant exchange to Class A common stock

Promissory Note (Details Narrative) - Successor [Member] - USD ($) $ in Thousands	1 Months Ended	3 Months Ended	10 Months Ended
	Mar. 31, 2023	Mar. 31, 2024	Dec. 31, 2023	May 15, 2024
Principal amount		$ 3,885	$ 3,885
Proceeds from note payable		3,000	3,000
Aggregate outstanding principal and interest balance				$ 4,050
Interest expense	$ 0	$ 320	$ 53
Subsequent Event [Member]
Aggregate outstanding principal and interest balance				$ 4,050

- Definition

Amount of the cost of borrowed funds accounted for as interest expense.

+ References + Details

CONSOLIDATED BALANCE SHEETS (Parenthetical) $ in Thousands	Dec. 31, 2023 USD ($) $ / shares shares
Successor [Member]
Allowance for credit losses \| $	$ 2
Debt discount \| $	834
Unamortized financing cost \| $	14
Interest payable \| $	$ 16
Successor [Member] \| Common Class A [Member]
Common stock, par value \| $ / shares	$ 0.0001
Common stock, shares authorized	200,000,000
Common stock, shares issued	15,254,389
Common stock, shares outstanding	15,254,389
Successor [Member] \| Common Class C [Member]
Common stock, par value \| $ / shares	$ 0.0001
Common stock, shares authorized	10,000,000
Common stock, shares issued	0
Common stock, shares outstanding	0

Deferred Revenue

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Deferred Revenue

Deferred Revenue

NOTE 8 – Deferred Revenue

Deferred revenue consisted of the following (in thousands):

Schedule of deferred revenue
	License Agreements			Professional Service Agreements			Total
Deferred Revenue – January 1, 2024	$	2,404		$	474		$	2,878
Revenue recognized		(1,588	)		(230	)		(1,818	)
Revenue deferred		2,406			166			2,572
Deferred Revenue – March 31, 2024	$	3,222		$	410		$	3,632

	License Agreements			Professional Service Agreements			Total
Deferred Revenue – March 15, 2023	$	2,148		$	386		$	2,534
Revenue recognized		(4,560	)		(1,186	)		(5,746	)
Revenue deferred		4,816			1,274			6,090
Deferred Revenue – December 31, 2023	$	2,404		$	474		$	2,878

Deferred revenues were approximately $3,632 thousand and $2,878 thousand at March 31, 2024 (Successor) and December 31, 2023 (Successor), respectively.

The fair value of the deferred revenue approximates the services to be rendered.

NOTE 8 – Deferred Revenue

Deferred revenue consisted of the following (in thousands):

Schedule of deferred revenue
	Successor
	License Agreements			Professional Service Agreements			Total
Deferred Revenue - March 15, 2023	$	2,148		$	386		$	2,534
Revenue recognized		(4,560	)		(1,186	)		(5,746	)
Revenue deferred		4,816			1,274			6,090
Deferred Revenue - December 31, 2023	$	2,404		$	474		$	2,878

	Predecessor
	License Agreements			Professional Service Agreements			Total
Deferred Revenue - January 1, 2022	$	2,524		$	622		$	3,146
Revenue recognized		(5,476	)		(2,994	)		(8,470	)
Revenue deferred		4,883			2,603			7,486
Deferred Revenue - December 31, 2022	$	1,931		$	231		$	2,162

Deferred revenues were approximately $2,878 thousand, $2,534 thousand, and $2,162 thousand at December 31, 2023 (Successor), March 14, 2023 (Predecessor), and December 31, 2022 (Predecessor), respectively.

The fair value of the deferred revenue approximates the services to be rendered given the short-term period over which it is expected to be recognized.

Goodwill and Intangible Assets (Details Narrative) - USD ($) $ in Thousands		1 Months Ended	3 Months Ended	10 Months Ended
	Apr. 14, 2024	Dec. 31, 2023	Dec. 31, 2023	Dec. 31, 2023	Mar. 31, 2024	Mar. 14, 2023
Goodwill, Impairment Loss		$ 36,056	$ 36,056
Successor [Member]
Goodwill		$ 8,737	$ 8,737	$ 8,737	$ 8,737
Goodwill, Impairment Loss				$ 36,056
Down Payment	$ 85
Due to related parties					$ 226

- Definition

+ References + Details

Disaggregation of Revenue

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Disaggregation Of Revenue

Disaggregation of Revenue

NOTE 4 – Disaggregation of Revenue

The Company recognizes revenue when control is transferred of the promised products or services to its customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those products or services. The Company derives revenue from software as a service, design and implementation services for its enterprise apps solutions systems, and professional services for work performed in conjunction with its systems.

Revenues consisted of the following (in thousands):

Schedule of disaggregation of revenue
	Successor				Predecessor
	Three Months Ended March 31, 2024		Period from March 15, 2023, to March 31, 2023		Period from January 1, 2023, to March 14, 2023
Subscription revenue
Software	$	1,588	$	240	$	1,204
Total subscription revenue	$	1,588	$	240	$	1,204

Non-subscription revenue
Professional services	$	230	$	102	$	416
Total non-subscription revenue		230	$	102	$	416

Total Revenue	$	1,818	$	342	$	1,620

	Successor				Predecessor
	Three Months Ended March 31, 2024		Period from March 15, 2023, to March 31, 2023		Period from January 1, 2023, to March 14, 2023
Revenue recognized over time⁽¹⁾⁽²⁾	$	1,818	$	342	$	1,620
Total	$	1,818	$	342	$	1,620

	(1)	Professional services are also contracted on the fixed fee and time and materials basis. Fixed fees are paid monthly, in phases, or upon acceptance of deliverables. The Company has generally elected the practical expedient to recognize revenue for the right to invoice because the Company’s right to consideration corresponds directly with the value to the customer of the performance completed to date.
	(2)	Software As A Service Subscription Revenue’s performance obligation is satisfied evenly over the service period using a time-based measure because the Company is providing continuous access to its service and service is recognized over time.

NOTE 4 – Disaggregation of Revenue

Revenues consisted of the following (in thousands):

Schedule of disaggregation of revenue
	Successor		Predecessor
	Period from March 15, 2023, to December 31, 2023		Period from January 1, 2023, to March 14, 2023		Year ended December 31, 2022
Subscription revenue
Software	$	4,560	$	1,204	$	5,476
Total subscription revenue	$	4,560	$	1,204	$	5,476

Non-subscription revenue
Professional services	$	1,186	$	416	$	2,994
Total non-subscription revenue	$	1,186	$	416	$	2,994

Total revenue	$	5,746	$	1,620	$	8,470

	Successor		Predecessor
	Period from March 15, 2023, to December 31, 2023		Period from January 1, 2023, to March 14, 2023		Year ended December 31, 2022
Revenue recognized over time⁽¹⁾⁽²⁾	$	5,746	$	1,620	$	8,470
Total	$	5,746	$	1,620	$	8,470

	(1)	Professional services are also contracted on the fixed fee and time and materials basis. Fixed fees are paid monthly, in phases, or upon acceptance of deliverables. The Company has generally elected the practical expedient to recognize revenue for the right to invoice because the Company’s right to consideration corresponds directly with the value to the customer of the performance completed to date, in which revenue is recognized over time.
	(2)	Software As A Service Subscription Revenue’s performance obligation is satisfied evenly over the service period using a time-based measure because the Company is providing continuous access to its service and service is recognized over time.

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Current Assets
Total current assets	$ 9,029	$ 8,798
Total Assets	36,581	33,433
Current Liabilities
Total current liabilities	10,316	8,645
Total Liabilities	11,183	9,842
Stockholders’ Equity
Total Stockholders’ Equity	25,398	23,591
Total Liabilities and Stockholders’ Equity	36,581	33,433
Successor [Member]
Current Assets
Cash and cash equivalents	6,275
Accounts receivable, net of allowance for credit losses of $2 and $5, respectively	1,956
Notes and other receivables	211
Prepaid expenses and other current assets	587
Total current assets	9,029
Property and equipment, net	115
Intangible assets, net	18,136
Operating lease right-of-use asset, net	486
Software development costs, net
Goodwill	8,737
Other assets	78
Total Assets	36,581
Current Liabilities
Accounts payable	975
Accrued liabilities	1,452
Deferred revenue	2,878
Acquisition liability
Warrant liability	1,683
Operating lease obligation, current	275
Note payable, net of debt discount of $834, unamortized financing costs of $14, and interest payable of $16 as of December 31, 2023	3,053
Total current liabilities	10,316
Operating lease obligation, noncurrent	230
Other noncurrent liabilities
Deferred tax liability	637
Total Liabilities	11,183
Stockholders’ Equity
Common Stock value	2
Additional paid-in capital	83,282
Accumulated deficit	(57,801)
Accumulated other comprehensive income (loss)	(85)
Net parent investment
Total Stockholders’ Equity	25,398
Total Liabilities and Stockholders’ Equity	36,581
Successor [Member] \| Common Class A [Member]
Stockholders’ Equity
Common Stock value	2
Successor [Member] \| Common Class C [Member]
Stockholders’ Equity
Common Stock value
Predecessor [Member]
Current Assets
Cash and cash equivalents		6,308
Accounts receivable, net of allowance for credit losses of $2 and $5, respectively		1,338
Notes and other receivables		273
Prepaid expenses and other current assets		650
Total current assets		8,569
Property and equipment, net		202
Intangible assets, net		19,289
Operating lease right-of-use asset, net		681
Software development costs, net		487
Goodwill
Other assets		52
Total Assets		29,280
Current Liabilities
Accounts payable		1,054
Accrued liabilities		1,736
Deferred revenue		2,162
Acquisition liability		197
Warrant liability
Operating lease obligation, current		266
Note payable, net of debt discount of $834, unamortized financing costs of $14, and interest payable of $16 as of December 31, 2023
Total current liabilities		5,415
Operating lease obligation, noncurrent		444
Other noncurrent liabilities		30
Deferred tax liability
Total Liabilities		5,889
Stockholders’ Equity
Additional paid-in capital
Accumulated deficit
Accumulated other comprehensive income (loss)		1,155
Net parent investment		22,236
Total Stockholders’ Equity		23,391
Total Liabilities and Stockholders’ Equity		29,280
Predecessor [Member] \| Common Class A [Member]
Stockholders’ Equity
Common Stock value
Predecessor [Member] \| Common Class C [Member]
Stockholders’ Equity
Common Stock value

Warrants (Details Narrative) - Successor [Member] - USD ($) $ / shares in Units, $ in Thousands			3 Months Ended		10 Months Ended	12 Months Ended
	Jul. 14, 2023	Jul. 13, 2023	Mar. 31, 2024	Sep. 30, 2023	Dec. 31, 2023	Dec. 31, 2023	Dec. 31, 2022
Proceeds from public warrants exercised					$ 4,948
Non-cash transaction	$ 4,914		$ 4,914
Loss on the warrant conversion	$ 3,900
Fair value of derivative liability			$ 3,900
Warrant Holder [Member]
Number of Warrant exercised		435,000
Number of warrant purchase	2,000,000
Common Stock, Par or Stated Value Per Share	$ 0.0001
Number of Warrant exchange	600,000
Public Warrants [Member]
Warrants outstanding			10,751,862		10,752,000	10,752,000	0
Warrant Price			$ 11.50
Proceeds from public warrants exercised		$ 5,002
Number of public warrants exercised				613,000		613,000
Number public warrants exercised				50,000		50,000
Private Warrants [Member]
Warrant Price					$ 11.50
Exercise Price per share		$ 11.50
Private Placements Warrants [Member]
Warrants outstanding			10,280,000		10,280,000	10,280,000	0

Goodwill and Intangible Assets (Tables)

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of intangible assets

Schedule of intangible assets
	March 31, 2024								December 31, 2023
	Weighted Average Remaining Useful Life (Years)	Gross Amount		Accumulated Amortization			Net Carrying Amount		Gross Amount		Accumulated Amortization			Net Carrying Amount
Trade Name/Trademarks	5.9	$	3,294	$	(490	)	$	2,804	$	3,294	$	(373	)	$	2,921
Customer Relationships	3.9		5,604		(1,168	)		4,436		5,604		(887	)		4,717
Developed Technology	8.9		8,697		(906	)		7,791		8,697		(688	)		8,009
Patents and Intellectual Property	8.9		2,703		(281	)		2,422		2,703		(214	)		2,489
Totals		$	20,298	$	(2,845	)	$	17,453	$	20,298	$	(2,162	)	$	18,136

Schedule of intangible assets
	December 31, 2023 (Successor)								December 31, 2022 (Predecessor)
	Weighted Average Remaining Useful Life (Years)	Gross Amount		Accumulated Amortization			Net Carrying Amount		Gross Amount		Accumulated Amortization			Net Carrying Amount
Trade Name/Trademarks	6.17	$	3,294	$	(373	)	$	2,921	$	2,183	$	(725	)	$	1,458
Customer Relationships	4.17		5,604		(887	)		4,717		6,401		(1,765	)		4,636
Developed Technology	9.17		8,697		(688	)		8,009		15,179		(3,398	)		11,781
Non-compete Agreements	-		-		-			-		3,150		(1,736	)		1,414
Patents and Intellectual Property	9.17		2,703		(214	)		2,489		-		-			-
Totals		$	20,298	$	(2,162	)	$	18,136	$	26,913	$	(7,624	)	$	19,289

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block]


For the Years Ending December 31,	Amount
2024 (remainder of year)	$	2,048
2025		2,731
2026		2,731
2027		2,731
2028		1,844
2029 and thereafter		5,368
Total	$	17,453

Schedule of future amortization expense
For the Years Ending December 31,	Amount
2024	$	2,731
2025		2,731
2026		2,731
2027		2,731
2028		1,844
2029 and thereafter		5,368
Total	$	18,136

Disaggregation of Revenue (Details) - USD ($)
$ in Thousands

1 Months Ended

2 Months Ended

3 Months Ended

10 Months Ended

12 Months Ended

Mar. 31, 2023

Mar. 14, 2023

Mar. 31, 2024

Dec. 31, 2023

Dec. 31, 2022

Successor [Member]

Total Revenue

$ 342

$ 1,818

$ 5,746

Successor [Member] | Transferred over Time [Member]

Total Revenue

342

^[1],[2]

1,818

^[1],[2]

5,746

^[3],[4]

Successor [Member] | Warrant Exercise Period Condition One

Total Revenue

240

1,588

4,560

Successor [Member] | Warrant Exercise Period Condition One | Software [Member]

Total Revenue

240

1,588

4,560

Successor [Member] | Non Subscription Revenue [Member]

Total Revenue

102

230

1,186

Successor [Member] | Non Subscription Revenue [Member] | Professional Services [Member]

Total Revenue

$ 102

$ 230

$ 1,186

Predecessor [Member]

Total Revenue

$ 1,620

$ 8,470

Predecessor [Member] | Transferred over Time [Member]

Total Revenue

^[3],[4]

1,620

^[1]

8,470

Predecessor [Member] | Warrant Exercise Period Condition One

Total Revenue

1,204

5,476

Predecessor [Member] | Warrant Exercise Period Condition One | Software [Member]

Total Revenue

1,204

5,476

Predecessor [Member] | Non Subscription Revenue [Member]

Total Revenue

416

2,994

Predecessor [Member] | Non Subscription Revenue [Member] | Professional Services [Member]

Total Revenue

$ 416

$ 2,994

[1]	Professional services are also contracted on the fixed fee and time and materials basis. Fixed fees are paid monthly, in phases, or upon acceptance of deliverables. The Company has generally elected the practical expedient to recognize revenue for the right to invoice because the Company’s right to consideration corresponds directly with the value to the customer of the performance completed to date.
[2]	Software As A Service Subscription Revenue’s performance obligation is satisfied evenly over the service period using a time-based measure because the Company is providing continuous access to its service and service is recognized over time.
[3]	Professional services are also contracted on the fixed fee and time and materials basis. Fixed fees are paid monthly, in phases, or upon acceptance of deliverables. The Company has generally elected the practical expedient to recognize revenue for the right to invoice because the Company’s right to consideration corresponds directly with the value to the customer of the performance completed to date, in which revenue is recognized over time.
[4]	Software As A Service Subscription Revenue’s performance obligation is satisfied evenly over the service period using a time-based measure because the Company is providing continuous access to its service and service is recognized over time.

- Definition

Amount of revenue recognized from goods sold, services rendered, insurance premiums, or other activities that constitute an earning process. Includes, but is not limited to, investment and interest income before deduction of interest expense when recognized as a component of revenue, and sales and trading gain (loss).

+ References

+ Details

Income Tax (Details 1) - USD ($) $ in Thousands	1 Months Ended	2 Months Ended	3 Months Ended	10 Months Ended	12 Months Ended
Income Tax (Details 1) - USD ($) $ in Thousands	Mar. 31, 2023	Mar. 14, 2023	Mar. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Successor [Member]
Foreign
Current
Deferred
Federal
Current				(7)
Deferred				(2,154)
State and Local
Current				19
Deferred				(506)
Total				(2,648)
Change in valuation allowance				(924)
Income tax expense/(benefit)	$ (1,560)		$ (207)	$ (3,572)
Predecessor [Member]
Foreign
Current					$ 152
Deferred		4,054			(1,533)
Federal
Current
Deferred		(637)			(2,697)
State and Local
Current					3
Deferred		(273)			(743)
Total		3,144			(4,818)
Change in valuation allowance		(3,144)			4,971
Income tax expense/(benefit)					$ 153

Income Tax (Tables)

12 Months Ended

Dec. 31, 2023

Income Tax Disclosure [Abstract]

Schedule of company’s net deferred tax assets


	Successor			Predecessor
(In thousands)	December 31, 2023			December 31, 2022
Organizational costs/startup expenses	$	1,031		$	-
Deferred revenue		41			-
Section 174 - software development cost		1,097			-
Stock based compensation		164			549
Research credits		-			123
Other accruals		50			49
Fixed assets		-			22
Other		-			1,328
Net operating loss carryforward		2,202			17,038
Total deferred tax asset		4,585			19,109
Less: Valuation allowance		(871	)		(14,403	)

Deferred tax asset, net of valuation allowance	$	3,714		$	4,706

	Successor			Predecessor
	December 31, 2023			December 31, 2022
Intangibles	$	(4,338	)	$	(4,386	)
Property, plant & equipment		(13	)		(13	)
Other		-			(177	)
Capitalized research		-			(127	)
Total deferred tax liabilities		(4,351	)		(4,703	)

Net Deferred Tax Asset (Liability)	$	(637	)	$	3

Schedule of income tax provision

Schedule of income tax provision
	Successor			Predecessor
	Period from March 15, 2023, to December 31, 2023			Period from January 1, 2023, to March 14, 2023			Year ended December 31, 2022
Foreign
Current	$	-		$	-		$	152
Deferred		-			4,054			(1,533	)

Federal
Current		(7	)		-			-
Deferred		(2,154	)		(637	)		(2,697	)

State and Local
Current		19			-			3
Deferred		(506	)		(273	)		(743	)
Total		(2,648	)		3,144			(4,818	)

Change in valuation allowance		(924	)		(3,144	)		4,971
Income tax expense/(benefit)	$	(3,572	)	$	-		$	153

Schedule of reconciliation of the federal income tax rate to the Company’s effective tax rate


	Successor			Predecessor
	Period from March 15, 2023, to December 31, 2023			Period from January 1, 2023, to March 14, 2023			Year ended December 31, 2022
Statutory federal income tax rate		21.00	%		21.00	%		21.00	%
Incentive stock options		-	%		(0.30	)%		(0.16	)%
Change in fair value of derivative warrant liabilities		(2.18	)%		-	%		-	%
Goodwill impairment loss		(14.34	)%		-	%		(4.00	)%
US-Foreign income tax rate difference		-	%		1.30	%		1.02	%
Permanent difference		0.22	%		0.07	%		(1.01	)%
Cancellation of debt income		-	%		(101.38	)%		-	%
Rate differential on foreign earnings		0.24	%		-	%		-	%
State taxes, net of federal tax benefit		0.93	%		3.49	%		2.01	%
Current federal tax true-up		0.01	%		-	%		-	%
Provision to return adjustments		-	%		-	%		(1.29	)%
Deferred only adjustment		-	%		4.80	%		(0.91	)%
Other		-	%		(0.35	)%		(0.06	)%
Valuation allowance		0.88	%		71.31	%		(17.13	)%
Income tax provision		6.76	%		-	%		(0.53	)%

Organization, Nature of Business and Basis of Presentation

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Accounting Policies [Abstract]

Organization, Nature of Business and Basis of Presentation

NOTE 1 – Organization, Nature of Business and Basis of Presentation

CXApp Inc. and its subsidiaries (“CXApp” or the “Company”) is in the business of delivering intelligent enterprise workplace experiences. The CXApp SaaS platform is anchored on the intersection of customer experience (CX) and artificial intelligence (AI) providing digital transformation for the physical workplace for enhanced experiences across people, places and things.

The CXApp SaaS platform offers a suite of leading-edge technology workplace experience solutions including an enterprise employee application, indoor mapping, on-device positioning, augmented reality technologies, generative AI applications and an AI-based analytics platform, targeting the emerging hybrid workplace market. CXApp creates a connected workplace by reducing app overload, data fragmentation, and complex workflows and streamlines all capabilities through The Workplace SuperApp. All features, services and integrations are housed in one easy-to-access platform allowing businesses to deliver a more holistic employee experience in a hybrid workplace.

On September 25, 2022, an Agreement and Plan of Merger (the “Merger Agreement”), was entered into by and among Inpixon, KINS, CXApp, and KINS Merger Sub Inc., a Delaware corporation and a wholly owned subsidiary of KINS (“Merger Sub”), pursuant to which KINS acquired Inpixon’s enterprise apps business (including its workplace experience technologies, indoor mapping, events platform, augmented reality and related business solutions) (“Legacy CXApp”) in exchange for the issuance of shares of KINS capital stock (the “Business Combination”). As a result of the Business Combination, KINS changed their name to CXApp Inc. (“CXApp”). The shares are now trading on the Nasdaq using the ticker CXAI. The transaction closed on March 14, 2023. See Note 3 for more details.

Unless the context otherwise requires, “we,” “us,” “our,” “CXApp” and the “Company” refer to CXApp Inc., a Delaware corporation, and its consolidated subsidiaries following the Business Combination (as defined below). Unless the context otherwise requires, references to “KINS” refer to KINS Technology Group Inc., a Delaware corporation (“KINS”), prior to the Business Combination. All references herein to the “Board” refer to the board of directors of the Company. “Legacy CXApp” refers to CXApp Holding Corp., a Delaware corporation and a wholly owned subsidiary of the Company, which the Company acquired through the Business Combination. Prior to the Separation (as defined below), Legacy CXApp was a wholly owned subsidiary of Inpixon, a Nevada corporation (“Inpixon”).

The Business Combination was accounted for using the acquisition method (as a forward merger), with goodwill and other identifiable intangible assets recorded in accordance with GAAP, as applicable. Under this method of accounting, the “Enterprise Apps Business” (formerly known as CXApp) is treated as the “acquired” company for financial reporting purposes. KINS (now known as CXApp Inc.) has been determined to be the accounting acquirer because KINS maintains control of the Board of Directors and management of the combined company.

NOTE 1 – Organization, Nature of Business and Basis of Presentation

On September 25, 2022, an Agreement and Plan of Merger (the “Merger Agreement”) was entered into by and among Inpixon, KINS, CXApp, and KINS Merger Sub Inc., a Delaware corporation and a wholly owned subsidiary of KINS (“Merger Sub”), pursuant to which KINS acquired Inpixon’s enterprise apps business (including its workplace experience technologies, indoor mapping, events platform, augmented reality and related business solutions) (“Legacy CXApp”) in exchange for the issuance of shares of KINS capital stock (the “Business Combination”). As a result of the Business Combination, KINS changed their name to CXApp Inc. (“CXApp”). The shares are now trading on the Nasdaq using the ticker CXAI. The transaction closed on March 14, 2023. See Note 3 for more details.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (Unaudited) - USD ($) $ in Thousands	1 Months Ended	2 Months Ended	3 Months Ended								10 Months Ended	12 Months Ended
	Mar. 31, 2023	Mar. 14, 2023	Mar. 31, 2024	Dec. 31, 2023	Sep. 30, 2023	Jun. 30, 2023	Dec. 31, 2022	Sep. 30, 2022	Jun. 30, 2022	Mar. 31, 2022	Dec. 31, 2023	Dec. 31, 2023	Dec. 31, 2022
Gross Profit												$ 5,615
Successor [Member]
Revenues	$ 342		$ 1,818								$ 5,746
Cost of Revenues	87		327								1,268
Gross Profit	255		1,491	$ 1,376	$ 1,412	$ 1,435					4,478
Operating Expenses
Research and development	211		1,599								5,309
Sales and marketing	174		1,114								3,242
General and administrative	241		1,682								5,374
Amortization of intangible assets	116		683								2,162
Total Operating Expenses	742		5,078								52,686
Loss from Operations	(487)		(3,587)								(48,208)
Other Income (Expense)
Interest income (expense), net	(1)		(262)								65
Change in fair value of derivative liability	1,686		(1,472)								(4,714)
Other income (expense), net			(56)								47
Total Other Income (Expense)	1,685		(1,790)								(4,602)
Net Loss, before tax	1,198		(5,377)								(52,810)
Income tax benefit	1,560		207								3,572
Net Loss	2,758		(5,170)								(49,238)
Unrealized foreign exchange gain/(loss) from cumulative translation adjustments			54								(85)
Comprehensive Loss	$ 2,758		$ (5,116)								$ (49,323)
Successor [Member] \| Common Class A [Member]
Other Income (Expense)
Basic weighted average shares outstanding	8,582,699		15,254,389								11,403,393
Diluted weighted average shares outstanding	8,582,699		15,254,389								11,403,393
Basic net income (loss) per share	$ 0.20		$ (0.34)								$ (4.32)
Diluted net income (loss) per share	$ 0.20		$ (0.34)								$ (4.32)
Successor [Member] \| Class C Common Stock [Member]
Other Income (Expense)
Basic weighted average shares outstanding	5,487,300					5,487,300
Diluted weighted average shares outstanding	5,487,300					5,487,300
Basic net income (loss) per share	$ 0.20					$ (1.05)
Diluted net income (loss) per share	$ 0.20					$ (1.05)
Predecessor [Member]
Revenues		$ 1,620											$ 8,470
Cost of Revenues		483											2,064
Gross Profit		1,137					$ 1,561	$ 1,243	$ 1,609	$ 1,993			6,406
Operating Expenses
Research and development		1,455											9,323
Sales and marketing		964											5,096
General and administrative		2,293											11,571
Amortization of intangible assets		806											3,885
Total Operating Expenses		5,518											35,431
Loss from Operations		(4,381)											(29,025)
Other Income (Expense)
Interest income (expense), net		1											4
Change in fair value of derivative liability
Other income (expense), net													(1)
Total Other Income (Expense)		1											3
Net Loss, before tax		(4,380)											(29,022)
Income tax benefit													(153)
Net Loss		(4,380)											(29,175)
Unrealized foreign exchange gain/(loss) from cumulative translation adjustments		(28)											1,155
Comprehensive Loss		$ (4,408)											$ (28,020)

Income Tax (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022
Successor [Member]
Organizational costs/startup expenses	$ 1,031
Deferred revenue	41
Section 174 - software development cost	1,097
Stock based compensation	164
Research credits
Other accruals	50
Fixed assets
Other
Net operating loss carryforward	2,202
Total deferred tax asset	4,585
Less: Valuation allowance	(871)
Deferred tax asset, net of valuation allowance	3,714
Intangibles	(4,338)
Property, plant & equipment	(13)
Other
Capitalized research
Total deferred tax liabilities	(4,351)
Net Deferred Tax Asset (Liability)	$ (637)
Predecessor [Member]
Organizational costs/startup expenses
Deferred revenue
Section 174 - software development cost
Stock based compensation		549
Research credits		123
Other accruals		49
Fixed assets		22
Other		1,328
Net operating loss carryforward		17,038
Total deferred tax asset		19,109
Less: Valuation allowance		(14,403)
Deferred tax asset, net of valuation allowance		4,706
Intangibles		(4,386)
Property, plant & equipment		(13)
Other		(177)
Capitalized research		(127)
Total deferred tax liabilities		(4,703)
Net Deferred Tax Asset (Liability)		$ 3

Promissory Note

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Debt Disclosure [Abstract]

Promissory Note

NOTE 10 – Promissory Note

Note payable consisted of the following (in thousands):

Promissory note
		March 31, 2024		December 31, 2023
Principal amount		$	3,885	$	3,885
Less:	Unamortized original issue discount		616		834
	Unamortized debt issuance cost		11		14
			3,258		3,037
Add:	Accrued interest payable		115		16
		$	3,373	$	3,053

On December 15, 2023, we entered into a note purchase agreement with Streeterville Capital, LLC (the “Lender”), pursuant to which we agreed to issue and sell to the Lender an unsecured promissory note (the “Note”) in an aggregate initial principal amount of $3,885 thousand, which is payable on or before the date that is 12 months from the issuance date. The initial principal amount includes an original issue discount of $870 thousand and $15 thousand that we agreed to pay to the Lender to cover the Lender’s legal fees, accounting costs, due diligence, monitoring and other transaction costs. The net proceeds of the Note is $3,000 thousand.

Interest on the Note accrues at a rate of 10% per annum and is payable on the maturity date.

A monitoring fee of 10% of the outstanding balance will be charged starting six (6) months from the issuance of the Note to cover Lender’s accounting, legal and other costs incurred in monitoring. The foregoing fee shall automatically be added to the outstanding balance on the applicable date without any further action by either party.

The Lender shall have the right to redeem up to an aggregate of 1/6th of the initial principal balance of the Note plus any interest accrued thereunder each month by providing written notice delivered to us; provided, however, that if the Lender does not exercise any monthly redemption amount in its corresponding month then such monthly redemption amount shall be available for the Lender to redeem in any further month in addition to such future month’s monthly redemption amount.

Upon receipt of any monthly redemption notice, we shall pay the applicable monthly redemption amount in cash to the Lender within five (5) business days of the Company’s receipt of such monthly redemption notice.

The Note includes customary event of default provisions, subject to certain cure periods, and provides for a default interest rate of 22%. Upon the occurrence of an event of default, interest would accrue on the outstanding balance beginning on the date the applicable event of default occurred at an interest rate equal to the lesser of twenty-two percent (22%) or the maximum rate permitted under applicable law.

As of May 15, 2024, there is an aggregate outstanding principal and interest balance of approximately $4,050 thousand underlying the December 2023 Note.

Interest expense recognized on the condensed consolidated statement of operations and comprehensive loss were approximately $320 thousand, $0 thousand and $53 thousand for the three months ended March 31, 2024 (Successor), for the period from March 15, 2023, to March 31, 2023 (Successor) and for the period from March 15, 2023, to December 31, 2023 (Successor), respectively.

NOTE 10 – Promissory Note

Note payable as of December 31, 2023, consisted of the following:


(In thousands)
Principal amount		$	3,885
Less:	Unamortized original issue discount		834
	Unamortized debt issuance cost		14
		$	3,037
Add:	Accrued interest payable		16
		$	3,053

Interest on the Note accrues at a rate of 10% per annum and is payable on the maturity date.

As of May 15, 2024, there is an aggregate outstanding principal and interest balance of approximately $4,050 thousand underlying the December 2023 Note.

During the period from March 15, 2023, to December 31, 2023, interest expense recognized on the consolidated statement of operations and comprehensive loss is approximately $53 thousand.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1B
-Subparagraph (h)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(c))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1

Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef
-Topic 470
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org//470/tableOfContent

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1B
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1B
-Subparagraph (g)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1B
-Subparagraph (i)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1C
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1C

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1C
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1C

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1C
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1C

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
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-Name Accounting Standards Codification
-Section 50
-Paragraph 1E
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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1E

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1I
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1I
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1I
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I

+ Details

Warrants (Tables)

12 Months Ended

Dec. 31, 2023

Warrants

Schedule of public and private warrant exercise activity


	Public Warrants			Private Warrants		Total
January 1, 2023		13,800,000			10,280,000		24,080,000
Warrants exchanged and exercised – cash		(2,435,000	)		-		(2,435,000	)
Warrants exercised – cashless		(613,138	)		-		(613,138	)
December 31, 2023		10,751,862			10,280,000		21,031,862

Foreign Operations (Tables)

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Foreign Operations

Schedule of financial data by geographic area


	United States			Canada			Philippines		Eliminations			Total
For the Three Months Ended March 31, 2024 (Successor):
Revenues by geographic area	$	1,667		$	151		$	240	$	(240	)	$	1,818
Operating income (loss) by geographic area	$	(3,000	)	$	(602	)	$	15	$	-		$	(3,587	)
Net income (loss) by geographic area	$	(4,527	)	$	(657	)	$	14	$	-		$	(5,170	)


For the Period from January 1, 2023, to March 14, 2023 (Predecessor):
Revenues by geographic area	$	1,395		$	285		$	160	$	(220	)	$	1,620
Operating income (loss) by geographic area	$	(3,479	)	$	(905	)	$	3	$	-		$	(4,381	)
Net income (loss) by geographic area	$	(3,342	)	$	(1,041	)	$	3	$	-		$	(4,380	)

For the Period from March 15, 2023, to March 31, 2023 (Successor):
Revenues by geographic area	$	272		$	70		$	196	$	(196	)	$	342
Operating income (loss) by geographic area	$	(486	)	$	(158	)	$	157	$	-		$	(487	)
Net income (loss) by geographic area	$	2,780		$	(158	)	$	157	$	(21	)	$	2,758

As of March 31, 2024 (Successor)
Identifiable assets by geographic area	$	36,681		$	600		$	445	$	(3,169	)	$	34,557
Long lived assets by geographic area	$	17,533		$	282		$	122	$	-		$	17,937
Goodwill by geographic area	$	8,737		$	-		$	-	$	-		$	8,737


As of December 31, 2023 (Successor)
Identifiable assets by geographic area	$	38,143		$	627		$	434	$	(2,623	)	$	36,581
Long lived assets by geographic area	$	18,269		$	320		$	148	$	-		$	18,737
Goodwill by geographic area	$	8,737		$	-		$	-	$	-		$	8,737


	United States			Canada			India		Philippines			Eliminations			Total
For the Period from March 15, 2023, to December 31, 2023 (Successor):
Revenues by geographic area	$	4,838		$	908		$	-	$	884		$	(884	)	$	5,746
Operating income (loss) by geographic area	$	(46,018	)	$	(2,380	)	$	-	$	190		$	-		$	(48,208	)
Net income (loss) by geographic area	$	(47,073	)	$	(2,332	)	$	-	$	188		$	(21	)	$	(49,238	)


For the Period from January 1, 2023, to March 14, 2023 (Predecessor):
Revenues by geographic area	$	1,395		$	285		$	-	$	160		$	(220	)	$	1,620
Operating income (loss) by geographic area	$	(3,479	)	$	(905	)	$	-	$	3		$	-		$	(4,381	)
Net income (loss) by geographic area	$	(3,342	)	$	(1,041	)	$	-	$	3		$	-		$	(4,380	)

For the Year Ended December 31, 2022 (Predecessor):
Revenues by geographic area	$	7,011		$	2,061		$	1,345	$	166		$	(2,113	)	$	8,470
Operating income (loss) by geographic area	$	(22,358	)	$	(7,163	)	$	569	$	(96	)	$	23		$	(29,025	)
Net income (loss) by geographic area	$	(21,774	)	$	(7,769	)	$	467	$	(99	)	$	-		$	(29,175	)

As of December 31, 2023 (Successor)
Identifiable assets by geographic area	$	38,143		$	627		$	-	$	434		$	(2,623	)	$	36,581
Long lived assets by geographic area	$	18,269		$	320		$	-	$	148		$	-		$	18,737
Goodwill by geographic area	$	8,737		$	-		$	-	$	-		$	-		$	8,737

As of December 31, 2022 (Predecessor)
Identifiable assets by geographic area	$	24,591	$	5,484	$	228	$	415	$	(1,438	)	$	29,280
Long lived assets by geographic area	$	15,558	$	4,788	$	98	$	215	$	-		$	20,659
Goodwill by geographic area	$	-	$	-	$	-	$	-	$	-		$	-

Stock Option Plan and Stock-Based Compensation (Details)	3 Months Ended	12 Months Ended
	Mar. 31, 2024 $ / shares shares	Dec. 31, 2023 $ / shares shares
Stock Option Plan And Stock-based Compensation
Number of options outstanding, beginning \| shares	984,900
Weighted-average exercise price, beginning	$ 1.53
Number of options, Granted \| shares	705,000	1,377,172
Weighted-average exercise price, Granted	$ 1.20	$ 1.53
Number of options, Forfeited \| shares		(392,272)
Weighted-average exercise price, Forfeited		$ 1.53
Number of options outstanding, ending \| shares	1,689,900	984,900
Weighted-average exercise price, ending		$ 1.53
Weighted average remaining contractual term (years)	9 years	9 years 3 months
Weighted-Average Fair Value at Grant Date	$ 0.90	$ 0.90
Number of options exercisable \| shares	492,450
Weighted-average exercise price, options exercisable	$ 1.53
Weighted average remaining contractual term, Granted	9 years 10 months 9 days
Weighted-Average Fair Value at Grant Date, Granted	$ 0.74
Number of options, Forfeited \| shares		392,272

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Current Assets
Total current assets		$ 9,029
Total Assets		36,581
Current Liabilities
Total current liabilities		10,316
Total Liabilities		11,183
Stockholders’ Equity
Total Stockholders’ Equity		25,398
Total Liabilities and Stockholders’ Equity		36,581
Successor [Member]
Current Assets
Cash and cash equivalents	$ 5,603	6,275
Accounts receivable, net of allowance for credit losses of $2 as of March 31, 2024, and December 31, 2023	1,370	1,956
Unbilled and other receivables	156	211
Prepaid expenses and other current assets	676	587
Total current assets	7,805	9,029
Property and equipment, net	110	115
Intangible assets, net	17,453	18,136
Operating lease right-of-use asset, net	374	486
Goodwill	8,737	8,737
Other assets	78	78
Total Assets	34,557	36,581
Current Liabilities
Accounts payable	1,019	975
Accrued liabilities	1,675	1,452
Deferred revenue	3,632	2,878
Warrant liability	3,155	1,683
Operating lease obligation, current	231	275
Note payable	3,373	3,053
Total current liabilities	13,085	10,316
Operating lease obligation, noncurrent	160	230
Deferred tax liability	429	637
Other noncurrent liabilities	2
Total Liabilities	13,676	11,183
Stockholders’ Equity
Common Stock value	2	2
Additional paid-in capital	83,881	83,282
Accumulated deficit	(62,971)	(57,801)
Accumulated other comprehensive loss	(31)	(85)
Total Stockholders’ Equity	20,881	25,398
Total Liabilities and Stockholders’ Equity	$ 34,557	$ 36,581

Subsequent Events

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Subsequent Events [Abstract]

Subsequent Events

NOTE 18 – Subsequent Events

On April 1, 2024, it is announced to the public that CXApp will be partnering with Google Cloud to define a new category in enterprise software: Employee Experiences. Google Cloud powers most of CXApp’s enterprise customer applications and is a natural partner to aid in expanding service offerings. As part of the agreement, Google and its service partners will provide advanced services including end-to-end security, analytics and monitoring as well as usage-based SaaS performance enhancements to create the best-in-class cloud-mobile experience to CXApp’s clients on the new CXAI Platform.

CXAI Platform is expected to be first deployed in the summer. Google has agreed to add the CXAI application platform to the Google Marketplace and signed a go-to-market partnership agreement. This would enable all of Google’s existing clients to have access to the CXAI platform with seamless and automated delivery.

On April 18, 2024, the Company received a notice (the “Notice”) from The Nasdaq Stock Market LLC (“Nasdaq”) notifying the Company that, because the Company is delinquent in filing its 2023 Form 10-K, the Company no longer complies with Nasdaq Listing Rule 5250(c)(1) (the “Listing Rule”), which requires companies with securities listed on Nasdaq to timely file all required periodic reports with the SEC.

In accordance with Nasdaq’s listing rules, the Company has 60 calendar days after the Notice to submit a plan of compliance (the “Plan”) to Nasdaq addressing how the Company intends to regain compliance with Nasdaq’s listing rules, and Nasdaq has the discretion to grant the Company up to 180 calendar days from the due date of the 2023 Form 10-K, or October 14, 2024, to regain compliance. The Company intends to submit the Plan and take the necessary steps to regain compliance with Nasdaq’s listing rules as soon as practicable.

On May 22, 2024, the Company entered into an equity line financing agreement for up to $10,000 thousand, with an initial draw of $2,500 thousand in the second quarter of 2024.

NOTE 20 – Subsequent Events

The Company evaluated subsequent events and transactions that occurred after December 31, 2023, up to the date that the consolidated financial statements were issued.

On January 3, 2024, the Company decided to streamline operations with a reorganization to drive efficiency using advanced technologies and a regional product and engineering support model. The Company is fully committed to all of its existing products and customers as well as its roadmap of AI based analytics and applications. As a result of this realignment, the Company expects operational efficiencies in excess of 25% as well as enhanced customer experiences moving forward.

In connection with the realignment described above, on January 3, 2024, it was determined that Leon Papkoff, Chief Product Officer, will separate from the Company effective January 4, 2024. The decision was not the result of any disagreement with the Company on any matter relating to the Company’s operations, policies or practices. Mr. Papkoff’s separation from employment will be treated per his employment agreement with the Company dated March 29, 2023.

On May 22, 2024, the Company entered into an equity line financing agreement for up to $10,000 thousand, with an initial draw of $2,500 thousand in the second quarter of 2024.

Goodwill and Intangible Assets, net (Details) - USD ($) $ in Thousands	1 Months Ended	3 Months Ended	10 Months Ended
	Dec. 31, 2023	Dec. 31, 2023	Dec. 31, 2023
Impairment	$ (36,056)	$ (36,056)
Successor [Member]
Beginning balance
Acquisition of Legacy CXApp			44,122
Measurement Period Adjustments			671
Impairment			(36,056)
Ending balance	$ 8,737	$ 8,737	$ 8,737

- Definition

+ References + Details

Property and Equipment, net (Details Narrative) - USD ($) $ in Thousands	1 Months Ended	2 Months Ended	3 Months Ended	10 Months Ended	12 Months Ended
	Mar. 31, 2023	Mar. 14, 2023	Mar. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Successor [Member]
Depreciation and amortization expense	$ 4		$ 22	$ 75
Predecessor [Member]
Depreciation and amortization expense		$ 19			$ 119

Accrued Liabilities

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Payables and Accruals [Abstract]

Accrued Liabilities

NOTE 9 – Accrued Liabilities

Accrued liabilities consisted of the following (in thousands):

Schedule of accrued Liabilities
	March 31, 2024		December 31, 2023
Accrued compensation and benefits	$	251	$	387
Accrued bonus and commissions		279		108
Income tax payables		78		74
Accrued insurance premium and interest		225		-
Accrued transaction costs		13		13
Accrued sales and other indirect taxes payable		8		12
Accrued other		821		858
Accrued liabilities	$	1,675	$	1,452

Financed Director & Officers Insurance

The Company entered into a Directors & Officers (“D&O”) insurance agreement with Oakwood D&O Insurance, effective on March 14, 2024. The agreement states that the Company will pay a total of $310 thousand in premiums at an annual percentage rate of 9.5%. The first of ten monthly separate installment payments begin on April 14, 2023. The Company paid a down payment on the policy of $85 thousand. As of March 31, 2024 (Successor) the Company currently owes $226 thousand on the D&O insurance policy.

NOTE 9 – Accrued Liabilities

Accrued liabilities consisted of the following (in thousands):

Schedule of accrued Liabilities
	Successor		Predecessor
	December 31, 2023		December 31, 2022
Accrued compensation and benefits	$	387	$	586
Accrued bonus and commissions		108		422
Income tax payables		74		-
Accrued rent		-		559
Accrued transaction costs		13		-
Accrued sales and other indirect taxes payable		12		86
Accrued other		858		83
Accrued liabilities	$	1,452	$	1,736

Property and Equipment, net (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Successor [Member]
Property, Plant and Equipment [Line Items]
Total	$ 206	$ 198
Less: accumulated depreciation and amortization	(96)	(83)
Total Property and Equipment, Net	110	115
Successor [Member] \| Office Equipment [Member]
Property, Plant and Equipment [Line Items]
Total	187	179
Successor [Member] \| Furniture and Fixtures [Member]
Property, Plant and Equipment [Line Items]
Total	12	12
Successor [Member] \| Leasehold Improvements [Member]
Property, Plant and Equipment [Line Items]
Total	6	6
Successor [Member] \| Software [Member]
Property, Plant and Equipment [Line Items]
Total	$ 1	$ 1
Predecessor [Member]
Property, Plant and Equipment [Line Items]
Total			$ 1,213
Less: accumulated depreciation and amortization			(1,011)
Total Property and Equipment, Net			202
Predecessor [Member] \| Office Equipment [Member]
Property, Plant and Equipment [Line Items]
Total			992
Predecessor [Member] \| Furniture and Fixtures [Member]
Property, Plant and Equipment [Line Items]
Total			185
Predecessor [Member] \| Leasehold Improvements [Member]
Property, Plant and Equipment [Line Items]
Total			28
Predecessor [Member] \| Software [Member]
Property, Plant and Equipment [Line Items]
Total			$ 8

Property and Equipment, net (Tables)

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Property, Plant and Equipment [Abstract]

Schedule of property and equipment

Schedule of property and equipment
	March 31, 2024			December 31, 2023
Computer and office equipment	$	187		$	179
Furniture and fixtures		12			12
Leasehold improvements		6			6
Software		1			1
Total		206			198
Less: accumulated depreciation and amortization		(96	)		(83	)
Total Property and Equipment, Net	$	110		$	115

Schedule of property and equipment
	Successor			Predecessor
	December 31, 2023			December 31, 2022
Computer and office equipment	$	179		$	992
Furniture and fixtures		12			185
Leasehold improvements		6			28
Software		1			8
Total		198			1,213
Less: accumulated depreciation and amortization		(83	)		(1,011	)
Total Property and Equipment, Net	$	115		$	202

Goodwill and Intangible Assets, net (Details 1) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Successor [Member]
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount	$ 20,298	$ 20,298
Finite-Lived Intangible Assets, Accumulated Amortization	(2,845)	(2,162)
Net carrying amount	$ 17,453	$ 18,136
Successor [Member] \| Trademarks and Trade Names [Member]
Finite-Lived Intangible Assets [Line Items]
Remaining weighted average useful life	5 years 10 months 24 days	6 years 2 months 1 day
Gross carrying amount	$ 3,294	$ 3,294
Finite-Lived Intangible Assets, Accumulated Amortization	(490)	(373)
Net carrying amount	$ 2,804	$ 2,921
Successor [Member] \| Customer Relationships [Member]
Finite-Lived Intangible Assets [Line Items]
Remaining weighted average useful life	3 years 10 months 24 days	4 years 2 months 1 day
Gross carrying amount	$ 5,604	$ 5,604
Finite-Lived Intangible Assets, Accumulated Amortization	(1,168)	(887)
Net carrying amount	$ 4,436	$ 4,717
Successor [Member] \| Developed Technology Rights [Member]
Finite-Lived Intangible Assets [Line Items]
Remaining weighted average useful life	8 years 10 months 24 days	9 years 2 months 1 day
Gross carrying amount	$ 8,697	$ 8,697
Finite-Lived Intangible Assets, Accumulated Amortization	(906)	(688)
Net carrying amount	$ 7,791	8,009
Successor [Member] \| Noncompete Agreements [Member]
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount
Finite-Lived Intangible Assets, Accumulated Amortization
Net carrying amount
Successor [Member] \| Patents And Intellectual Property [Member]
Finite-Lived Intangible Assets [Line Items]
Remaining weighted average useful life	8 years 10 months 24 days	9 years 2 months 1 day
Gross carrying amount	$ 2,703	$ 2,703
Finite-Lived Intangible Assets, Accumulated Amortization	(281)	(214)
Net carrying amount	$ 2,422	$ 2,489
Predecessor [Member]
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount			$ 26,913
Finite-Lived Intangible Assets, Accumulated Amortization			(7,624)
Net carrying amount			19,289
Predecessor [Member] \| Trademarks and Trade Names [Member]
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount			2,183
Finite-Lived Intangible Assets, Accumulated Amortization			(725)
Net carrying amount			1,458
Predecessor [Member] \| Customer Relationships [Member]
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount			6,401
Finite-Lived Intangible Assets, Accumulated Amortization			(1,765)
Net carrying amount			4,636
Predecessor [Member] \| Developed Technology Rights [Member]
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount			15,179
Finite-Lived Intangible Assets, Accumulated Amortization			(3,398)
Net carrying amount			11,781
Predecessor [Member] \| Noncompete Agreements [Member]
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount			3,150
Finite-Lived Intangible Assets, Accumulated Amortization			(1,736)
Net carrying amount			1,414
Predecessor [Member] \| Patents And Intellectual Property [Member]
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount
Finite-Lived Intangible Assets, Accumulated Amortization
Net carrying amount

Accrued Liabilities (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Successor [Member]
Accrued compensation and benefits	$ 251	$ 387
Accrued bonus and commissions	279	108
Income tax payables	78	74
Accrued rent
Accrued transaction costs	13	13
Accrued sales and other indirect taxes payable	8	12
Accrued other	821	858
Accrued liabilities	1,675	1,452
Accrued insurance premium and interest	$ 225
Predecessor [Member]
Accrued compensation and benefits			$ 586
Accrued bonus and commissions			422
Income tax payables
Accrued rent			559
Accrued transaction costs
Accrued sales and other indirect taxes payable			86
Accrued other			83
Accrued liabilities			$ 1,736

Business Combination (Tables)

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Business Combination and Asset Acquisition [Abstract]

Schedule of assets acquired

Schedule of assets acquired
Description	Fair Value		Weighted Average Useful Life (in years)
Purchase Price	$	69,928

Assets acquired:
Cash and cash equivalents	$	10,003
Accounts receivable		2,226
Notes and other receivables		209
Prepaid assets and other current assets		408
Operating lease right of use asset		557	3 years
Property and equipment, net		133	3 years
Other assets		42
Developed technology		8,697	10 years
Patents		2,703	10 years
Customer relationships		5,604	5 years
Tradenames and trademarks		3,294	7 years
Total assets acquired	$	33,876

Liabilities assumed:
Accounts payable	$	443
Accrued liabilities		969
Deferred revenues		2,534
Operating lease obligation, current		194
Operating lease obligation, noncurrent		384
Deferred tax liability		4,217
Total liabilities assumed		8,741
Goodwill	$	44,793

Schedule of assets acquired
Description	Fair Value		Weighted Average Useful Life (in years)
Purchase Price	$	69,928

Assets acquired:
Cash and cash equivalents	$	10,003
Accounts receivable		2,226
Notes and other receivables		209
Prepaid assets and other current assets		588
Operating lease right of use asset		557
Property and equipment, net		133
Other assets		42
Developed technology		9,268	10 years
Patents		2,703	10 years
Customer relationships		5,604	5 years
Tradenames and trademarks		3,294	7 years
Total assets acquired	$	34,627

Liabilities assumed:
Accounts payable	$	461
Accrued liabilities		911
Deferred revenues		2,534
Operating lease obligation, current		194
Operating lease obligation, noncurrent		384
Deferred tax liability		4,337
Total liabilities assumed		8,821
Goodwill	$	44,122

Schedule of proforma financial information


	For the Three Months Ended March 31, 2023
Revenues	$	1,962
Net income (loss)		(6,365	)


	As of December 31,
	2023		2022
Assets
Current assets	$	9,029	$	8,798
Noncurrent assets		27,552		24,635
Total assets	$	36,581	$	33,433

Liabilities
Current liabilities	$	10,316	$	8,645
Noncurrent liabilities		867		1,197
Total liabilities	$	11,183	$	9,842

Stockholders’ equity	$	25,398	$	23,591
Total stockholders’ equity	$	25,398	$	23,591

Total liabilities and equity	$	36,581	$	33,433

CXAPP INC. AND SUBSIDIARIES

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND
COMPREHENSIVE INCOME (LOSS)

(in thousands)

	As of December 31,
	2023			2022
Revenues	$	7,366		$	8,470
Net loss	$	(57,904	)	$	(20,828	)

Warrants (Details) - Successor [Member]	12 Months Ended
Warrants (Details) - Successor [Member]	Dec. 31, 2023 shares
Warrants outstanding at beginning	24,080,000
Warrants exchanged and exercised - cash	(2,435,000)
Warrants exercised - cash	(613,138)
Warrants outstanding at ending	21,031,862
Public Warrants [Member]
Warrants outstanding at beginning	13,800,000
Warrants exchanged and exercised - cash	(2,435,000)
Warrants exercised - cash	(613,138)
Warrants outstanding at ending	10,751,862
Private Warrants [Member]
Warrants outstanding at beginning	10,280,000
Warrants exchanged and exercised - cash
Warrants exercised - cash
Warrants outstanding at ending	10,280,000

Common Stock (Details Narrative) - Successor [Member] - $ / shares	Sep. 10, 2023	Mar. 31, 2024	Dec. 31, 2023
Common Class C [Member]
Class of Stock [Line Items]
Number of shares converted	5,487,300
Common stock, par value	$ 0.0001		$ 0.0001
Common Class A [Member]
Class of Stock [Line Items]
Number of shares issued	5,487,300
Common stock, par value		$ 0.0001	$ 0.0001

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

Reference 1: http://www.xbrl.org/2003/role/exampleRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 2: http://www.xbrl.org/2003/role/recommendedDisclosureRef
-Topic 272
-SubTopic 10
-Name Accounting Standards Codification
-Section 45
-Paragraph 3
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483014/272-10-45-3

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 272
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482987/272-10-50-1

Reference 4: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(d))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (e)
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-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (h)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 14
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-14

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 18
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-18

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 210
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(27)(b))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480566/210-10-S99-1

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 210
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(28))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480566/210-10-S99-1

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-2

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Topic 210
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(29))
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-URI https://asc.fasb.org//1943274/2147480566/210-10-S99-1

Reference 15: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
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-Paragraph 3
-Subparagraph (SX 210.6-03(i)(2))
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-URI https://asc.fasb.org//1943274/2147479886/946-10-S99-3

Reference 16: http://www.xbrl.org/2003/role/disclosureRef
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Reference 17: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
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-Subparagraph (SX 210.6-03(i)(2)(i))
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-URI https://asc.fasb.org//1943274/2147479886/946-10-S99-3

Reference 18: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 3
-Subparagraph (SX 210.6-03(i)(2)(ii))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479886/946-10-S99-3

+ Details

Summary of Significant Accounting Policies (Details Narrative) - USD ($) $ in Thousands	1 Months Ended			2 Months Ended	3 Months Ended				10 Months Ended	12 Months Ended
	May 22, 2024	Dec. 31, 2023	Mar. 31, 2023	Mar. 14, 2023	Mar. 31, 2024	Dec. 31, 2023	Sep. 30, 2023	Jun. 30, 2023	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Property, Plant and Equipment [Line Items]
Goodwill, Impairment Loss		$ 36,056				$ 36,056
Equity line financing agreement description	Company entered into an equity line financing agreement for up to $10,000 thousand, with an initial draw of $2,500 thousand in the second quarter of 2024.
Successor [Member]
Property, Plant and Equipment [Line Items]
Working capital		1,287			$ 5,280	1,287			$ 1,287
Cash and cash equivalents		6,275			5,603	6,275			6,275
Net income			$ (2,758)		5,170				49,238
Cash for operating activities			4,431		$ 650				12,766
Reduction in accrued liabilities		5,876				5,876			$ 5,876
Cash and cash equivalents, description					As of March 31, 2024 (Successor), the Company had cash equivalents of approximately $4,916 thousand of certificates of deposit held by a number of banks limited to $250 thousand per bank with a duration of 90 days or less. As of December 31, 2023 (Successor), the Company had $5,584 cash equivalents.				As of December 31, 2023 (Successor), the Company had cash equivalents of approximately $5,584 thousand of certificates of deposit held by a number of banks limited to $250 thousand per bank with a duration of 90 days or less. As of December 31, 2022 (Predecessor), the Company had no cash equivalents.
Allowance for credit losses		2				2			$ 2
Impairment charge on goodwill									36,056
Goodwill, Impairment Loss									36,056
Revenue recognized			170		$ 1,030				2,163
Changes in estimated fair value of warrants			1,686		1,472				4,714
Change in FV of derivative instruments			(1,686)		1,472	(420)	$ (5,220)	$ 12,040	4,714
Impairment charges of long-lived assets			0		0				0
Cash and cash equivalents		5,584				5,584			5,584
Allowance for credit losses		2			2	2			2
Deferred revenue		$ 2,878		$ 2,534	3,632	$ 2,878			$ 2,878
Change in FV of derivative instruments			$ 1,686		$ 1,472
Successor [Member] \| Minimum [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, net useful life		5 years			5 years	5 years			5 years
Intangible assets useful life		5 years			5 years	5 years			5 years
Successor [Member] \| Maximum [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, net useful life		10 years			10 years	10 years			10 years
Intangible assets useful life		10 years			10 years	10 years			10 years
Successor [Member] \| Equity Line Financing Agreement [Member]
Property, Plant and Equipment [Line Items]
Cash and cash equivalents, description									The Company discussed plans to finance its future working capital requirements and capital expenditures from cash generated from operating activities, cash raised under the equity line financing agreement for up to $10,000 thousand, with an initial draw of $2,500 thousand in the second quarter of 2024, and cash raised under the promissory note of $3,000 thousand dollars payable by December 2024.
Predecessor [Member]
Property, Plant and Equipment [Line Items]
Cash and cash equivalents										$ 6,308
Net income				4,380						29,175
Cash for operating activities				5,144						18,895
Impairment charge on goodwill				36,056
Goodwill, Impairment Loss				(0)						5,540
Revenue recognized				865						2,820
Changes in estimated fair value of warrants				0
Impairment charges of long-lived assets				0						0
Allowance for credit losses										5
Deferred revenue				2,534						$ 2,162	$ 3,146
Change in FV of derivative instruments				$ 0

Summary of Significant Accounting Policies (Policies)

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Accounting Policies [Abstract]

Liquidity

Liquidity

●

In January 2024, the Company streamlined its operations to conserve cash resources by laying off approximately 20% of the global employee headcount;

●

In March 2024, the Company successfully negotiated for a 50% reduction in D&O insurance premium.

Liquidity

Use of Estimates

Use of Estimates

●

the valuation of stock-based compensation;

●

the valuation of warrant liabilities;

●

the allowance for credit losses;

●

the valuation allowance for deferred tax assets; and

●

impairment of long-lived assets and goodwill.

Use of Estimates

●

the valuation of stock-based compensation;

●

the valuation of warrant liabilities;

●

the allowance for credit losses;

●

the valuation allowance for deferred tax assets; and

●

impairment of long-lived assets and goodwill.

Basis of Presentation

Basis of Presentation

Principles of Consolidation

Principles of Consolidation

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

Principles of Consolidation

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

Emerging Growth Company

Emerging Growth Company

Cash and Cash Equivalents

Cash and Cash Equivalents

Cash and cash equivalents consist of cash, checking accounts, money market accounts, temporary investments and certificates of deposit with maturities of three months or less when purchased. As of December 31, 2023 (Successor), the Company had cash equivalents of approximately $5,584 thousand of certificates of deposit held by a number of banks limited to $250 thousand per bank with a duration of 90 days or less. As of December 31, 2022 (Predecessor), the Company had no cash equivalents.

Accounts Receivable, net and Allowance for Credit Losses

Accounts Receivable, net and Allowance for Credit Losses

Property and Equipment, net

Property and Equipment, net

Intangible Assets, net

Intangible Assets, net

Intangible Assets

Goodwill

Goodwill

The Company calculates the estimated fair value of a reporting unit using a weighting of the income and market approaches. For the income approach, the Company uses internally developed discounted cash flow models that include the following assumptions, among others: projections of revenues, expenses, and related cash flows based on assumed long-term growth rates and demand trends; expected future investments to grow new units; and estimated discount rates. For the market approach, the Company uses internal analyses based primarily on market comparables. The Company bases these assumptions on its historical data and experience, third-party appraisals, industry projections, micro and macro general economic condition projections, and its expectations. Based on its assessments, the Company incurred an impairment charge of $36,056 thousand for the period from March 15, 2023, to December 31, 2023 (Successor) and did not incur impairment for the period from January 1, 2023, to March 14, 2023 (Predecessor). The Company incurred an impairment charge of approximately $5,540 thousand for the year ended December 31, 2022 (Predecessor).

Leases and Right-of-Use Assets and Liabilities

Leases and Right-of-Use Assets and Liabilities

Income Taxes

Income Taxes

The Company accounts for income taxes using the asset and liability method. Accordingly, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in the tax rate is recognized in income or expense in the period that the change is effective. Income tax benefits are recognized when it is probable that the deduction will be sustained. A valuation allowance is established when it is more likely than not that all or a portion of a deferred tax asset will either expire before the Company is able to realize the benefit, or that future deductibility is uncertain.

Comprehensive Income (Loss) and Foreign Currency Translation

Comprehensive Income (Loss) and Foreign Currency Translation

Debt Issuance Costs

Debt Issuance Costs

Debt Issuance Cost

The costs related to the issuance of debt are capitalized and amortized to interest expense over the life of the related debt using the effective interest method. The amendments to FASB ASC 835-30 require that debt issuance costs be presented in the Consolidated Balance Sheet as a direct deduction from the carrying amount of debt, consistent with debt discounts or premiums.

Revenue Recognition

Revenue Recognition

The standard introduces a five-step model for revenue recognition that replaces the four criteria for revenue recognition under previous GAAP. The five steps are shown below:

Identify the contract with a customer;

Identify the performance obligations in the contract;

Determine the transaction price;

Allocate the transaction price to performance obligations; and

Recognize revenue when (or as) the entity satisfies a performance obligation.

License Subscription Revenue Recognition (Software As A Service)

Professional Services Revenue Recognition

The Company provides integration and software customization professional services to its customers.

Contract Balances

Costs to Obtain a Contract

Cost to Fulfill a Contract

The Company incurs costs to fulfill their obligations under a contract once it has obtained the contract. These costs are generally not significant and are recorded to expense as incurred.

Multiple Performance Obligations

Sales and Use Taxes

The Company presents transactional taxes such as sales and use tax collected from customers and remitted to government authorities on a net basis.

Shipping and Handling Costs

Shipping and handling costs are expensed as incurred as part of cost of revenues. These costs were deemed to be de minimis during each of the reporting periods.

Revenue Recognition

The Company recognizes revenue, in accordance with ASC 606, when control is transferred of the promised products or services to its customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those products or services. The Company derives revenue from its software as a service for cloud based software, as well as design, implementation and other professional services for work performed in conjunction with its cloud based software. The Company enters into contracts with its customers whereby it grants a non-exclusive cloud-based license for the use of its proprietary software and for professional services. The contracts may also provide for on-going services for a specified price, which may include maintenance services, designated support, and enhancements, upgrades and improvements to the software, depending on the contract. Licenses for cloud software provide the customer with a right to use the software as it exists when made available to the customer. All software provides customers with the same functionality and differs mainly in the duration over which the customer benefits from the software.

The standard introduces a five-step model for revenue recognition that replaces the four criteria for revenue recognition under previous GAAP. The five steps are shown below:

Identify the contract with a customer,

Identify the performance obligations in the contract,

Determine the transaction price,

Allocate the transaction price to performance obligations, and

Recognize revenue when (or as) the entity satisfies a performance obligation.

License Subscription Revenue Recognition (Software As A Service)

Professional Services Revenue Recognition

The Company provides integration and software customization professional services to its customers.

Professional services are also contracted on the fixed fee and in some cases on a time and materials basis. Fixed fees are paid monthly, in phases, or upon acceptance of deliverables. The Company’s time and materials contracts are paid weekly or monthly based on hours worked. Revenue on time and material contracts is recognized based on a fixed hourly rate as direct labor hours are expended. Materials, or other specified direct costs, are reimbursed as actual costs and may include markup. The Company has elected the practical expedient to recognize revenue for the right to invoice because the Company’s right to consideration corresponds directly with the value to the customer of the performance completed to date. For fixed fee contracts provided by in house personnel, the Company recognizes revenue evenly over the service period using a time-based measure because the Company is providing continuous service. Because the Company’s contracts have an expected duration of one year or less, the Company has elected the practical expedient in ASC 606-10-50-14(a) to not disclose information about its remaining performance obligations. Anticipated losses are recognized as soon as they become known. For the period from March 15, 2023, to December 31, 2023 (Successor), for the period from January 1, 2023, to March 14, 2023 (Predecessor), and year ended December 31, 2022 (Predecessor), the Company did not incur any such losses. These amounts are based on known and estimated factors.

Contract Balances

The timing of the Company’s revenue recognition may differ from the timing of invoicing to and payment by its customers. The Company records an unbilled receivable when revenue is recognized prior to invoicing and the Company has an unconditional right to payment. Alternatively, when invoicing a customer precedes the Company providing of the related services, the Company records deferred revenue until the performance obligations are satisfied. The Company had deferred revenue of approximately $2,878 thousand and $2,162 thousand as of December 31, 2023 (Successor) and December 31, 2022 (Predecessor), respectively, related to customer invoices rendered in advance for software licenses and professional services provided by the Company’s technical staff. The Company expects to satisfy its remaining performance obligations for the deferred revenue associated with professional services, and recognize the deferred revenue related to licenses generally over the remaining contract term which is generally twelve months following the commencement of the license. The Company recognized revenue in the reporting period of $2,163 thousand, $865 thousand, and $2,820 thousand, that was included in the deferred revenue at the beginning of the period, for the period from March 15, 2023, to December 31, 2023 (Successor), for the period from January 1, 2023, to March 14, 2023 (Predecessor), and for the year ended December 31, 2022 (Predecessor), respectively.

Costs to Obtain a Contract

Cost to Fulfill a Contract

The Company incurs costs to fulfill their obligations under a contract once it has obtained the contract. These costs are generally not significant and are recorded to expense as incurred.

Multiple Performance Obligations

Sales and Use Taxes

The Company presents transactional taxes such as sales and use tax collected from customers and remitted to government authorities on a net basis.

Shipping and Handling Costs

Shipping and handling costs are expensed as incurred as part of cost of revenues. These costs were deemed to be de minimis during each of the reporting periods.

Research and Development

Research and Development

Business Combinations

Business Combinations

Segments

Segments

Stock-Based Compensation

Stock-Based Compensation

The Company estimates forfeitures at the time of grant and revises these estimates in subsequent periods if actual forfeitures differ from those estimates.

Stock-Based Compensation

The Company measures the cost of employee and non-employee services received in exchange for an award of equity instruments based on the grant date fair value of the award. The Company has issued stock-based compensation awards in the form of options and restricted stock units. Fair value for options and restricted stock units are valued using the closing price of our common stock on the date of grant. The grant date fair value is recognized over the requisite service period during which an employee and non-employee is required to provide service in exchange for the award.

The Company estimates forfeitures at the time of grant and revises these estimates in subsequent periods if actual forfeitures differ from those estimates.

Derivative Warrant Liabilities

Derivative Warrant Liabilities

The Company utilized the public warrant quoted market price as the fair value of the warrants as of each relevant date.

Derivative Warrant Liabilities

For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of additional paid-in capital at the time of issuance or modification. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded at their initial fair value on the date of issuance as a warrant liability, and adjusted to the then fair value in each balance sheet date thereafter. Changes in the estimated fair value of the warrants are recognized as a non-cash gain or loss on the consolidated statements of operations and amounted to approximately $4,714 thousand of a loss for the period from March 15, 2023, to December 31, 2023 (Successor). The Company utilized the public warrant quoted market price as the fair value of the warrants as of each relevant date.

Earnings Per Share

Earnings Per Share

Schedule of antidilutive shares
(in thousands)	Three Months Ended March 31, 2024		Period from March 15, 2023, to March 31, 2023
Stock options		1,689,900		1,377,000
Restricted stock units		533,165		-
Warrants		21,032,000		24,080,000
Total		23,255,065		25,457,000

Earnings Per Share

The following table summarizes the number of common shares and common share equivalents excluded from the calculation of diluted net loss per common share for the year ended December 31, 2023.

Schedule of antidilutive shares
	Successor
(in thousands)	Year Ended December 31, 2023
Stock options		985
Restricted stock units		821
Warrants		21,032
Total		22,838

No calculation for Earnings Per Share was made for the year ended 2022 because CXApp only commenced operations in March 15, 2023.

Fair Value Measurements

Fair Value Measurements

●

Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities.

●

Level 2: Observable prices that are based on inputs not quoted on active markets but corroborated by market data.

●

The following table shows the changes in fair value of the liabilities:


Warrant liability – January 1, 2024	$	1,683
Change in FV of derivative instruments		1,472
Warrant liability – March 31, 2024	$	3,155

Warrant liability – March 15, 2023	$	2,649
Change in FV of derivative instruments		(1,686	)
Warrant liability – March 31, 2023	$	963

Fair Value Measurements

●

Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities.

●

Level 2: Observable prices that are based on inputs not quoted on active markets but corroborated by market data.

●

Fair value measurements discussed herein are based upon certain market assumptions and pertinent information available to management. The fair value of the warrants has been measured based on the listed market price of such warrants, a Level 1 measurement. For the period ended March 15, 2023 to December 31, 2023 (Successor), the Company recognized an unrealized loss in the Statements of Operations and Comprehensive Income of $4,714 thousand which is presented as change in fair value of derivative liability.

The following table shows the changes in fair value of the liabilities during the period ended December 31, 2023:


Balance at March 15, 2023	$	2,649
Change in FV of derivative instruments		(1,686	)
Balance at March 31, 2023		963
Change in FV of derivative instruments		12,040
Balance at June 30, 2023	$	13,003
Change in FV of derivative instruments		(5,220	)
FV of Warrants cash exercised and exchanged for Class A common stock (see Note 11 - Warrants)		(1,237	)
Loss on warrant extinguishment		(3,894	)
FV of Warrants cashless exercised for Class A common stock (see Note 11 - Warrants)		(549	)
Balance at September 30, 2023	$	2,103
Change in FV of derivative instruments		(420	)
Balance at December 31, 2023	$	1,683

Fair Value of Financial Instruments

Fair Value of Financial Instruments

Carrying Value, Recoverability and Impairment of Long-Lived Assets

Carrying Value, Recoverability and Impairment of Long-Lived Assets

The Company follows FASB ASC 360 “Property, Plant, and Equipment” (“ASC 360”) for its long-lived assets. Pursuant to ASC 360-10-35-17, an impairment loss shall be recognized only if the carrying amount of a long-lived asset (asset group) is not recoverable and exceeds its fair value. The carrying amount of a long-lived asset (asset group) is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset (asset group). That assessment shall be based on the carrying amount of the asset (asset group) at the date it is tested for recoverability. An impairment loss shall be measured as the amount by which the carrying amount of a long-lived asset (asset group) exceeds its fair value. Pursuant to ASC 360-10-35-20, if an impairment loss is recognized, the adjusted carrying amount of a long-lived asset shall be its new cost basis. For a depreciable long-lived asset, the new cost basis shall be depreciated (amortized) over the remaining useful life of that asset. Restoration of a previously recognized impairment loss is prohibited.

New Accounting Pronouncements Adopted in 2023

New Accounting Pronouncements Adopted in 2023

Recently Issued Accounting Standards Not Yet Adopted

Recently Issued Accounting Standards Not Yet Adopted

In October 2023, the FASB issued ASU 2023-06 “Disclosure Improvements,” which amends the codification in response to the SEC’s Disclosure Update and Simplification Initiative. The effective date of this update is for fiscal years beginning after June 30, 2027, including interim periods within those fiscal years. The Company is currently assessing potential impacts of ASU 2023-06 and does not expect the adoption of this guidance will have a material impact on its consolidated financial statements and disclosures.

Stock Option Plan and Stock-Based Compensation (Tables)

3 Months Ended

12 Months Ended

Mar. 31, 2024

Dec. 31, 2023

Stock Option Plan And Stock-based Compensation

Schedule of stock options

Schedule of stock options
	Number of Options		Weighted-average exercise price		Weighted average remaining contractual term (years)		Weighted-Average Fair Value at Grant Date
Options outstanding at January 1, 2024		984,900	$	1.53		9.00	$	0.90
Granted		705,000		1.20		9.86		0.74
Forfeited		-		-
Options outstanding at March 31, 2024		1,689,900
Options exercisable at March 31, 2024		492,450	$	1.53

Schedule of stock options
	Number of Options			Weighted average exercise price		Weighted average remaining contractual term (years)		Weighted- Average Fair Value at Grant Date
Options outstanding at January 1, 2023		-		$	-		-	$	-
Granted		1,377,172			1.53
Forfeited		(392,272	)		1.53
Options outstanding at December 31, 2023		984,900		$	1.53		9.25	$	0.90
Options exercisable at December 31, 2023		-		$	-		-		-

Schedule of assumptions used

Schedule of assumptions used
Risk-free interest rate		3.67% – 4.03%
Expected life of option grants		5.75 – 6.25 years
Expected volatility of underlying stock		61.65%
Dividends assumption		$-

Schedule of assumptions used
Risk-free interest rate		3.67%
Expected life of option grants		5.75 years
Expected volatility of underlying stock		61.65%
Dividends assumption		$-

Schedule of non-cash stock-based compensation expenses

	Successor				Predecessor
	Three Months ended March 31, 2024		Period from March 15, 2023, to March 31, 2023		Period from January 1, 2023, to March 14, 2023
Research and development	$	3	$	-	$	-
Sales and marketing		32		-		-
General and administrative		185		2		158
Total non-cash stock compensation	$	220	$	2	$	158

Schedule of non-cash stock-based compensation expenses related to restricted stock units


	Three Months ended March 31, 2024
Research and development	$	98
Sales and marketing		51
General and administrative		232
Total non-cash stock compensation	$	381