ESPP

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2024

OR

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

For the transition period from to

Commission File Number: 000-56409

Global Crossing Airlines Group, Inc.

(Exact name of registrant as specified in its charter)

Delaware	86-2226137
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification Number)

4200 NW 36th Street, Building 5A Miami International Airport Miami, Florida	33166
(Address of principal executive office)	(Zip Code)

Registrant’s telephone number, including area code: (786) 751-8503

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act: common stock and Class B non-voting common stock

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes [ ] No [X]

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes [ ] No [X]

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

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

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

Large accelerated filer	[ ]	Accelerated filer	[ ]
Non-accelerated filer	[X]	Smaller reporting company	[X]
		Emerging growth company	[X]

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

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C 7262(b)) by the registered public accounting firm that prepared or issued its audit report. [ ]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [X]

The number of shares outstanding of the registrant’s Common Stock as of August 12, 2024 was 60,698,680 shares, consisting of 43,062,231 shares of common stock, 5,537,313 shares of Class A Non-Voting Common Stock and 12,099,136 shares of Class B Non-Voting Common Stock.

GLOBAL CROSSING AIRLINES GROUP, INC.

Form 10-Q

Period Ended June 30, 2024

Index

Global Crossing Airlines Group, Inc.	Page
ITEM 1. GLOBAL CROSSING AIRLINES GROUP, INC. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Condensed Consolidated Balance Sheets as of June 30, 2024 (Unaudited) and December 31, 2023	3
Condensed Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2024 and 2023 (Unaudited)	4
Condensed Consolidated Statements of Stockholders' Equity for the Three and Six Months Ended June 30, 2024 and 2023 (Unaudited)	5
Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2024 and 2023 (Unaudited)	6
Notes to Condensed Consolidated Financial Statements (Unaudited)	7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	18
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	26
ITEM 4. CONTROLS AND PROCEDURES	27
PART II - OTHER INFORMATION	28
ITEM 6. EXHIBITS	29
SIGNATURES	30

2

GLOBAL CROSSING AIRLINES GROUP INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except par value and share quantities)

	June 30, 2024 (Unaudited)	December 31, 2023
Current Assets
Cash and cash equivalents	$8,047	$11,596
Restricted cash	2,400	6,080
Accounts receivable, net of allowance	6,485	10,180
Prepaid expenses and other current assets	2,017	2,552
Current assets held for sale	403	184
Total Current Assets	19,352	30,592
Property and equipment, net	8,296	5,525
Finance leases, net	20,107	4,108
Operating lease right-of-use assets	90,664	76,880
Deposits	11,909	12,506
Other assets	3,114	1,717
Total Assets	$153,442	$131,328
Current liabilities
Accounts payable	$9,982	$7,481
Accrued liabilities	17,159	17,465
Deferred revenue	3,888	9,896
Customer deposits	4,429	3,935
Current portion of long-term operating leases	13,323	13,650
Current portion of finance leases	2,284	599
Total current liabilities	51,065	53,026
Other liabilities
Note payable, net of unamortized debt issuance costs	29,389	29,175
Long-term operating leases	79,512	65,158
Long-term finance leases	17,964	3,292
Other liabilities	511	544
Total other liabilities	127,376	98,169
Total Liabilities	$178,441	$151,195
Commitments and Contingencies (Note 7)
Equity (Deficit)
Common Stock
$.001 par value; 200,000,000 authorized; 60,603,681 and 58,925,871 issued and outstanding as of June 30, 2024 and December 31, 2023, respectively	$60	$59
Additional paid-in capital	40,004	38,943
Retained deficit	(65,189)	(59,094)
Total Company's stockholders’ deficit	(25,125)	(20,092)
Noncontrolling interest	126	225
Total stockholders’ deficit	(24,999)	(19,867)
Total Liabilities and Deficit	$153,442	$131,328

See accompanying notes to consolidated financial statements.

3

GLOBAL CROSSING AIRLINES GROUP INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)

(In thousands, except share and per share amounts)

	Three Months Ended June 30, 2024	Three Months Ended June 30, 2023	Six Months Ended June 30, 2024	Six Months Ended June 30, 2023
Revenue	$57,546	$31,475	$111,380	$63,626
Operating Expenses
Salaries, Wages, & Benefits	16,745	12,140	33,520	23,308
Aircraft Fuel	5,601	6,087	13,800	14,036
Maintenance, materials and repairs	2,645	1,767	5,578	3,326
Depreciation and amortization	1,444	443	2,609	886
Contracted ground and aviation services	4,757	5,201	11,660	10,054
Travel	3,118	1,347	6,969	3,601
Insurance	1,554	1,245	3,188	2,370
Aircraft Rent	14,762	6,830	27,523	12,474
Other	4,377	3,191	8,609	5,995
Total Operating Expenses	$55,003	$38,251	$113,456	$76,050
Operating Income (Loss)	2,543	(6,776)	(2,076)	(12,424)
Non-Operating Expenses
Interest Expense	2,258	695	4,018	1,119
Total Non-Operating Expenses	2,258	695	4,018	1,119
Income (Loss) before income taxes	285	(7,471)	(6,094)	(13,543)
Income tax expense	-	-	-	-
Net Income (Loss)	285	(7,471)	(6,094)	(13,543)
Net Income attributable to Noncontrolling Interest	1	-	1	-
Net Income (Loss) attributable to the Company	284	(7,471)	(6,095)	(13,543)
Income (Loss) per share:
Basic	$0.00	$(0.13)	$(0.10)	$(0.24)
Diluted	$0.00	$(0.13)	$(0.10)	$(0.24)
Weighted average number of shares outstanding	60,008,779	56,857,629	59,621,946	55,680,815
Fully diluted shares outstanding	83,633,139	56,857,629	59,621,946	55,680,815

See accompanying notes to consolidated financial statements.

4

GLOBAL CROSSING AIRLINES GROUP INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(UNAUDITED)

(In thousands, except shares quantities)

	Common Stock Number of Shares	Amount	Additional Paid in Capital	Retained Deficit	Total
Beginning – January 1, 2023	53,440,482	$53	$30,774	$(38,083)	$(7,256)
Issuance of shares – options exercised	150,000	-	67	-	67
Issuance of shares – warrants exercised	2,499,453	3	1,134	-	1,137
Issuance of shares - share based compensation on RSUs	208,416	-	501	-	501
Loss for the period	-	-	-	(6,072)	(6,072)
Ending – March 31, 2023	56,298,351	$56	$32,476	$(44,155)	$(11,623)
Issuance of shares – options exercised	-	-	-	-	-
Issuance of shares – warrants exercised	227,630	-	220	-	220
Issuance of shares - share based compensation on RSUs	481,593	1	578	-	579
Issuance of shares - ESPP	300,121	-	199	-	199
Loss for the period	-	-	-	(7,471)	(7,471)
Ending – June 30, 2023	57,307,695	$57	$33,473	$(51,626)	$(18,096)

	Common Stock Number of Shares	Amount	Additional Paid in Capital	Retained Deficit	Total	Noncontrolling Interest	Total
Beginning – January 1, 2024	58,925,871	$59	$38,943	$(59,094)	$(20,092)	$225	$(19,867)
Issuance of shares - share based compensation on RSUs	742,079	1	342	-	343	-	343
Loss for the period	-	-	-	(6,379)	(6,379)	-	(6,379)
Ending – March 31, 2024	59,667,950	$60	$39,285	$(65,473)	$(26,128)	$225	$(25,903)
Issuance of shares - share based compensation on RSUs	544,157	-	498	-	498	-	498
Issuance of shares - ESPP	391,574	-	221	-	221	-	221
Dividends	-	-	-	-	-	(100)	(100)
Income for the period	-	-	-	284	284	1	285
Ending – June 30, 2024	60,603,681	$60	$40,004	$(65,189)	$(25,125)	$126	$(24,999)

See accompanying notes to consolidated financial statements.

5

GLOBAL CROSSING AIRLINES GROUP INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

(In thousands)

	For The Six Months Ended June 30,
	2024			2023
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss	$	(6,094	)	$	(13,543	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation expense		2,609			894
Bad debt expense (recovery)		357			(18	)
Loss on sale of property		—			136
Loss (gain) on sale of spare parts		79			(107	)
Foreign exchange loss		—			1
Amortization of debt issue costs		339			531
Amortization of operating lease right of use assets		7,081			3,647
Share-based payments		874			1,109
Interest on finance leases		1,042			202
Changes in assets and liabilities:
Accounts receivable		3,339			(2,931	)
Assets held for sale		(298	)		701
Prepaid expenses and other current assets		535			(684	)
Accounts payable		2,501			4,767
Accrued liabilities and other liabilities		(5,821	)		12,344
Operating lease obligations		(6,838	)		(3,669	)
Other liabilities		(945	)		233
Net cash (used in) provided by operating activities		(1,240	)		3,613
CASH FLOWS FROM INVESTING ACTIVITIES
Deposits, deferred costs and other assets		(1,616	)		(1,069	)
Purchases of property and equipment		(3,603	)		(2,969	)
Net cash used in investing activities		(5,219	)		(4,038	)
CASH FLOWS FROM FINANCING ACTIVITIES
Principal payments on finance leases		(858	)		(221	)
Dividends		(100	)		—
Proceeds on issuance of shares		188			1,594
Proceeds from note payable		—			2,017
Net cash (used in) provided by financing activities		(770	)		3,390
Net (decrease) increase in cash, cash equivalents, and restricted cash		(7,229	)		2,965
Cash, cash equivalents and restricted cash - beginning of the period		17,676			5,461
Cash, cash equivalents and restricted cash - end of the period	$	10,447		$	8,426
Non-cash transactions
Right-of-use (ROU) assets acquired through operating leases	$	20,865		$	37,297
Equipment acquired through finance leases	$	17,085		$	1,334
Note Payable reductions through accounts receivable from sale of Assets held for sale	$	-		$	337
Reclass of capitalized professional fees from proceeds from senior secured note	$	125		$	-
Cash paid for
Interest	$	3,421		$	473

See accompanying notes to consolidated financial statements.

6

GLOBAL CROSSING AIRLINES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

(In thousands, except share and per share data)

Item 1 - Financial Statements

1.BASIS OF PRESENTATION AND GOING CONCERN

Global Crossing Airlines Group, Inc. (the “Company” or “GlobalX”) principal business activity is providing passenger and cargo aircraft to customers through aircraft operating service agreements including, crew, maintenance, insurance (“ACMI”) and charter services “Charter” serving the United States, Caribbean, Latin American and European markets.

The condensed consolidated financial statements include the accounts of the Company, and its subsidiaries, Global Crossing Airlines, Inc. and Global Crossing Airlines Operations, LLC (collectively “GlobalX USA”), Global Crossing Airlines Holdings, Inc, GlobalX Travel Technologies, Inc. (“Technologies”), GlobalX Air Tours, LLC (“GlobalX Tours”), LatinX Air S.A.S., GlobalX Colombia S.A.S., UrbanX Air Mobility, Inc. ("UrbanX") and Charter Air Solutions, LLC ("Top Flight"). All intercompany transactions and balances have been eliminated on consolidation.

The accompanying unaudited condensed consolidated financial statements and related notes (the “Financial Statements”) have been prepared in accordance with the U.S. Securities and Exchange Commission (the “SEC”) requirements for quarterly reports on Form 10-Q, and consequently exclude certain disclosures normally included in audited consolidated financial statements prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP). The Financial Statements should be read in conjunction with the audited consolidated financial statements and the notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, which includes additional disclosures and a summary of our significant accounting policies.

Our quarterly results are subject to seasonal and other fluctuations and the operating results for any quarter are therefore not necessarily indicative of results that may be otherwise expected for the entire year.

The condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP), on a going concern basis which assumes that the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future. As of June 30, 2024, the Company had a working capital deficit of $31.7 million and a retained deficit of $65.2 million. The Company began flight operations in August 2021. Without ongoing income generation or additional financing, the Company will be unable to fund general and administrative expenses and working capital requirements for the next 12 months. These material uncertainties raise substantial doubt as to the Company’s ability to continue as a going concern. The Company is evaluating financing its future requirements through a combination of debt, equity and/or other facilities. There is no assurance that the Company will be able to obtain such financing or obtain them on favorable terms. The condensed consolidated financial statements do not reflect the adjustments to the carrying values of assets and liabilities and the reported expenses and statement of financial position classifications that would be necessary were the going concern assumption deemed to be inappropriate. These adjustments could be material.

2. NEW ACCOUNTING STANDARDS

Recently Issued Accounting Standards

In March 2024, the FASB issued ASU 2024-02 - Codification Improvements - Amendments to Remove References to the Concepts Statements. This update contains amendments to the Codification that remove reference to various FASB Concepts Statement. The amendments in this update are effective for public business entities for fiscal years beginning after December 15, 2024. Management expects no significant impact after adoption of the new standard.

In March 2024, the FASB issued ASU 2024-01 - Compensation-Stock Compensation - Amendments to improve generally accepted accounting principles (GAAP) by adding an illustrative example to demonstrate how an entity should apply the scope guidance in paragraph 718-10-15-3 to determine whether profits interest and similar awards ("profits interest awards") should be accounted for in accordance with Topic 718, Compensation-Stock Compensation. The amendments in this update are effective for public business entities for fiscal years beginning after December 15, 2024. Management expects no significant impact after adoption of the new standard.

7

3.INVESTMENTS

Investment in Canada Jetlines Operations Ltd.:

On June 28, 2021, the Company completed the spin-out pursuant to the Arrangement under which the Company transferred 75% of shares of Jetlines to GlobalX shareholders. At that time, GlobalX retained 25% of the shares issued and outstanding of Jetlines and accounts for the investment in accordance with the equity method. As of June 30, 2024 and 2023, the Company holds approximately 7% and 13% ownership in Jetlines, respectively.

Investment in Top Flight:

On September 18, 2023, the Company acquired 80% of Charter Air Solutions, LLC ("Top Flight"). Top Flight was established on February 8, 2023 and had no significant transactions from the date of formation to the acquisition date. The balance sheet and operating activity of Top Flight are included in the Company's consolidated financial statements and net income is adjusted in the consolidated statement of operations to exclude the noncontrolling interests' proportionate share of results. The proportionate share of equity attributable to noncontrolling interests is presented as equity within our consolidated balance sheet.

4.NOTE PAYABLE

On January 27, 2023, the Company announced an up to $5.0 million loan (the "Loan") with a key investor to provide working capital and additional liquidity to support GlobalX’s rapidly growing operations. The net proceeds of the Loan were to be used to further the business objectives of the Company and to secure additional aircraft for charter operations. As of June 30, 2024, the Company received $2.5 million from the loan.

The terms of the promissory note (the "Note") issued in connection with Loan include:

•a maturity date of 6 months from the date of issuance (the “Maturity Date”) and the principal amount of the Note, together with any accrued and unpaid interest, will be payable on the Maturity Date;

•the Note bears interest at the rate of 20% per annum, accruing monthly and payable on the Maturity Date;

•the principal amount of the Note will be advanced in two tranches of $2.5 million each. The first tranche was advanced within one business day and the second tranche will be advanced after the Company delivers a draw down notice, but subject to the lender receiving internal approval for the second tranche; and

•the Note is unsecured, is not convertible and provides for no warrants.

This loan was paid off in connection with the new $35.0 million secured notes closed on August 2, 2023 and the outstanding balance related to debt costs and discounts of approximately $945 thousand was written off.

On August 2, 2023, the Company closed the placement of $35 million senior secured notes due 2029. The proceeds from these notes were used to pay-off the pre-existing Loan and Subscription Agreement.

The terms of the senior secure notes include:

•a term of 6 years and maturity date of June 30, 2029 with no principal payments due until maturity date;

•the notes bear interest at a fixed rate of 15% per annum and include an upfront fee of 2% of the principal payment;

•the Company is permitted to prepay all (but not less than all) of the notes beginning on July 1, 2025 subject to a redemption premium of (i) 7.5% of the principal to be redeemed on or prior to August 2, 2026, (ii) 5.0% of the principal to be redeemed after August 2, 2026 or on or prior to August 2, 2027, (iii) 2.5% of the principal to be redeemed after August 2, 2027 or on or prior to August 2, 2028, (iv) 0% of the principal to be redeemed after August 2, 2028;

•the investors will be issued 10 million warrants, each exercisable into one share of Class A common stock at an exercise price of $1.00 per share, with such warrants expiring on June 30, 2030;

•each of the Company's material subsidiaries will guarantee the notes;

•the notes and the related guarantees will be secured by a lien on substantially all of the property and assets of the Company and the guarantors of the notes.

•financial covenants requirements as follows:

8

ominimum adjusted EBITDA of (i) $5 million for the fiscal year ended December 31, 2023, (ii) $15 million for the fiscal year ended December 31, 2024 and (iii) $25 million for the fiscal year ended December 31, 2025;

ominimum liquidity of $5 million measured at each quarter end;

•collateralized by substantially of all the Company's assets.

The Company determined that the terms of the warrants issued in the financing require the warrants to be classified as equity. Accordingly, upon issuance, the Company recorded debt issuance costs of $3.8 million related to the warrants along with a corresponding credit to additional paid in capital. As the warrants are classified as equity warrants the Company will not remeasure the warrants each accounting period.

Since the warrants may purchase a fixed number of shares for a fixed price, the Company chose to use the Monte Carlo option pricing model to value the warrants at issuance. The inputs selected are: underlying stock price at date of issuance of $0.85 per share, exercise price of $1.0 per share, expected term of 6.91 years, dividends of $0, a risk free rate of 4.21%, and volatility of 50%.

The debt issuance costs resulting from the warrants along with other direct costs of the financing will be amortized to interest expense using the effective interest method.

On December 21, 2023, the Company and the senior secured notes due 2029 purchasers amended the original placement of $35 million senior secured notes due 2029 for the sale of an additional $5 million senior secured notes due 2029 to original purchasers and the total warrants increased by 142,874 warrants with an exercise price of US$1.00 per warrant. The net proceeds from the sale of the additional notes will be used to repurchase $4.3 million principal amount of senior secure notes due 2029 from an original purchaser plus payment of accrued interest due of $251 thousand, with the balance expected to be used for general corporate purposes, including the transaction expenses and deposits to expand its current fleet of aircraft. No other substantial modification to the terms of the original $35 million senior secure notes due 2029 was made in the issuance of the additional notes.

Notes Payable is comprised of the following:

	For the Period Ended June 30, 2024		For the Year Ended December 31, 2023
Subscription Agreement	$	35,684	$	35,684
Less unamortized debt issuance costs, noncurrent		6,295		6,509
Total carrying amount		29,389		29,175
Less current maturities	—		—
Total long-term Note Payable	$	29,389	$	29,175

GEM Global Yield LLC SCS

The Company entered into an agreement with GEM Global Yield LLC SCS ("GEM"), the private alternative investment group to provide the Company with up to CND $100 million over a 36-month term following the closing of the Transaction (the “Facility”). The initial CAD $100 million is in the form of a capital commitment that allows the Company to draw down funds during the 36-month term by issuing shares to GEM (or such persons as it may direct) and subject to share lending arrangement(s) being in place. The purchase price of the shares to be sold is set at (i) 90% of the recent average daily closing price of the Company’s common stock on the TSX Venture Exchange or (ii) the floor price set by the company for each drawn down. The Company is not permitted to make a draw-down request in an amount that exceeds (i)1000% of the average daily trading volume of the Company’s stock for the 15 trading days preceding the draw-down date or (ii) 90% of the closing price on the trading day immediately prior to the issue or the relevant draw down notice and then added to the aggregate purchase price of all the common shares subscribed for pursuant to all prior closings would not exceed the total facility. GEM may accept or reject such drawn down notice based on various conditions described in the agreement. On July 8, 2020, the TSX Venture Exchange provided approval for the Facility.

On March 4, 2024, Global Crossing Airlines and GEM decided to extend the length of the GEM Facility by 12 months with a new expiration date of March 4, 2025.

5.SHARE CAPITAL AND ADDITIONAL PAID IN CAPITAL AUTHORIZED

As of June 30, 2024 and December 31, 2023, the Company had 42,440,983 and 40,420,350 common shares, 5,537,313 and 5,537,313 Class A Non-Voting Common Shares, and 12,625,385 and 12,968,208 Class B Non-Voting Shares outstanding, respectively.

9

6.WARRANTS

Following is a summary of the warrant activity during the three and six months ended June 30, 2024 and 2023:

	Number of Share Purchase Warrants			Weighted Average Exercise Price
Outstanding January 1, 2023		19,633,911		$	1.18
Issued		-			-
Exercised		(2,499,453	)		0.43
Expired		-			-
Outstanding March 31, 2023		17,134,458		$	1.29
Issued		-			-
Exercised		(227,630	)		0.97
Expired		(4,530,808	)		0.99
Outstanding June 30, 2023		12,376,020		$	1.40
Outstanding January 1, 2024		22,571,471		$	1.35
Issued		-			-
Exercised		-			-
Expired		(4,838,707	)		1.24
Outstanding March 31, 2024		17,732,764		$	1.21
Issued		-			-
Exercised		-			-
Expired		-			-
Outstanding June 30, 2024		17,732,764		$	1.21

As of June 30, 2024, the following share purchase warrants were outstanding and exercisable:

Outstanding		Exercise Price	Remaining life (years)		Expiry Date
	7,537,313	USD$1.50		1.83	April 29, 2026
	10,195,451	USD$1.00		6.00	Jun 30, 2030
	17,732,764

As of June 30, 2023, the following share purchase warrants were outstanding and exercisable:

Outstanding		Exercise Price	Remaining life (years)		Expiry Date
	4,838,707	USD$1.24		0.75	March 28, 2024
	7,537,313	USD$1.50		2.83	April 29, 2026
	12,376,020

7.SHARE-BASED PAYMENTS

The maximum number of voting shares is the number of common stock of the Company issuable pursuant to share-based payment arrangements, including stock options, restricted share units and performance share units, is 9,400,000.

Stock options

The Company grants stock options to directors, officers, employees and consultants as compensation for services, pursuant to its Amended Stock Option Plan (the “Stock Option Plan”). The maximum price shall not be less than the closing price of the Company’s shares on the last trading day preceding the date on which the grant of options is approved by the Board of Directors. Options have a maximum expiry period of ten years from the grant date. Vesting conditions are determined by the Board of Directors in its discretion with certain restrictions in accordance with the Stock Option Plan.

The following is a summary of stock option activities for the three and six months ended June 30, 2024 and 2023:

10

	Number of stock options			Weighted average exercise price		Weighted average grant date fair value
Outstanding January 1, 2023		820,668		$	0.25	$	0.34
Granted		—			—		—
Exercised		(150,000	)		0.48		0.16
Forfeited		(200,000	)		0.25		0.57
Outstanding March 31, 2023		470,668		$	0.25	$	0.54
Granted		—			—		—
Exercised		—			—		—
Forfeited		—			—		—
Outstanding June 30, 2023		470,668		$	0.25	$	0.54
Outstanding January 1, 2024		470,668		$	0.25	$	0.54
Granted		—			—		—
Exercised		—			—		—
Forfeited		(157,334	)		0.37		0.24
Outstanding March 31, 2024		313,334		$	0.25	$	0.25
Granted		—			—		—
Exercised		—			—		—
Forfeited		(66,667	)		0.25		0.67
Outstanding June 30, 2024		246,667		$	0.25	$	0.67

As of June 30, 2024, the following stock options were outstanding and exercisable:

Outstanding		Exercisable		Exercise Price		Remaining life (years)		Expiry Date
	246,667		246,667	$	0.25		—	June 23, 2025
	246,667		246,667

As of June 30, 2023, the following stock options were outstanding and exercisable:

Outstanding		Exercisable		Exercise Price		Remaining life (years)		Expiry Date
	420,668		420,668	$	0.25		1.98	June 23, 2025
	50,000		50,000	$	0.62		2.24	September 23, 2025
	470,668		470,668

The Company recognizes share-based payments expense for all stock options granted using the fair value based method of accounting. The fair value of stock options is determined by the Black-Scholes Option Pricing Model with assumptions for risk-free interest rates, dividend yields, volatility factors of the expected market price of the Company’s shares, forfeiture rate, and expected life of the options.

There were no stock options granted during the three and six months ended June 30, 2024 and 2023.

Restricted share units

The Company grants restricted share units (“RSUs”) to directors, officers, employees and consultants as compensation for services, pursuant to its Amended RSU Plan (the “RSU Plan”). One restricted share unit has the same value as a Voting Share. The number of RSUs awarded and underlying vesting conditions are determined by the Board of Directors in its discretion.

At the election of the Board of Directors, upon each vesting date, participants receive (a) the issuance of Voting Shares from treasury equal to the number of RSUs vesting, or (b) a cash payment equal to the number of vested RSUs multiplied by the fair market value of a Voting Share, calculated as the closing price of the Voting Shares on the NEO for the trading day immediately preceding such payment date; or (c) a combination of (a) and (b).

On the grant date of RSUs, the Company determines whether it has a present obligation to settle in cash. If the Company has a present obligation to settle in cash, the RSUs are accounted for as liabilities, with the fair value remeasured at the end of each reporting period and at the date of settlement, with any changes in fair value recognized in profit or loss for the period. The Company has a present obligation to settle in cash if the choice of settlement in shares has no commercial substance, or the Company has a past practice or a stated policy of settling in cash, or generally settles in cash whenever the counterpart asks for cash settlement.

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If no such obligation exists, RSUs are accounted for as equity settled share-based payments and are valued using the share price on grant date. Upon settlement:

a.If the Company elects to settle in cash, the cash payment is accounted for as the repurchase of an equity interest (i.e. as a deduction from equity), except as noted in (c) below.

b.If the Company elects to settle by issuing shares, the value of RSUs initially recognized in reserves is reclassified to capital, except as noted in (c) below.

c.If the Company elects the settlement alternative with the higher fair value, as of the date of settlement, the Company recognizes an additional expense for the excess value given (i.e. the difference between the cash paid and the fair value of shares that would otherwise have been issued, or the difference between the fair value of the shares and the amount of cash that would otherwise have been paid, whichever is applicable).

The following is a summary of RSU activities for the three and six months ended June 30, 2024 and 2023:

	Number of RSUs			Weighted average grant date fair value per RSU
Outstanding January 1, 2023		3,305,837		$	1.14
Granted		1,687,777			0.97
Vested		(400,542	)		1.04
Forfeited		(129,315	)		0.96
Outstanding March 31, 2023		4,463,757		$	1.10
Granted		1,155,000			0.97
Vested		(467,500	)		0.91
Forfeited		(378,334	)		1.01
Outstanding June 30, 2023		4,772,923		$	1.01
Outstanding January 1, 2024		4,989,603		$	0.98
Granted		2,573,333			0.52
Vested		(794,579	)		1.02
Forfeited		(870,002	)		1.11
Outstanding March 31, 2024		5,898,355		$	0.75
Granted		231,667			0.54
Vested		(619,908	)		1.26
Forfeited		(330,892	)		0.71
Outstanding June 30, 2024		5,179,222		$	0.69

During the three and six months ended June 30, 2024, the Company recognized total share-based payments expense with respect to stock options, RSUs and employees' stock purchase plan of $0.5 and $0.9 million, respectively. During the three and six months ended June 30, 2023, the Company recognized total share-based payments expense with respect to stock options, RSUs and employees' stock purchase plan of $0.6 and $1.1 million, respectively.

The remaining compensation that has not been recognized as of June 30, 2024 and 2023 with regards to RSUs and the weighted average period they will be recognized are $2.8 million and 2.16 years and $3.8 million and 2.18 years, respectively. As of June 30, 2024, all compensation expense with respect to stock options has been recognized.

Employee Stock Purchase Plan

In September 2021, the Board adopted the GlobalX 2021 Employee Stock Purchase Plan (“ESPP”). There are 2 offering periods that the employees make contributions to the plan. The first offering period starts from June 16th to November 15th and the second offering period starts from November 16 th to May 15th of each year. Eligible employees may purchase maximum of $10 of the Company's common stock per offering through payroll deductions at a price equal to 85% of the lower of the fair market values of the stock as of the beginning or the end of six-month offering periods. An employee's payroll deductions under the ESPP are limited to 15% of the employee's compensation and an employee may not purchase more than $25 of stock during any calendar year in which the employee’s option to purchase stock under the ESPP is outstanding at any time.

During the three and six months ended June 30, 2024, the Company issued 391,574 common shares under the ESPP. During the three and six months ended June 30, 2023, the Company issued 300,121 common shares under the ESPP.

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As of June 30, 2024 and 2023, total recognized equity-based compensation costs related to ESPP was 0.2 million.

ESPP payroll contributions accrued at June 30, 2024 and 2023, totaled $48 and $88 thousand, respectively, and are included within accrued expenses in the consolidated balance sheets. Employee payroll contributions used to purchase shares under the ESPP will be reclassified to stockholders' equity at the end of the offering period.

8. INCOME TAXES

The Company’s expected effective tax rate for the three and six months ended June 30, 2024, and 2023 was 0%. The effective tax rate varies from the statutory rate due to the change in the valuation allowance.

9. COMMITMENTS AND CONTINGENCIES

The Company has contractual obligations and commitments primarily with regard to management and development services, lease arrangements and financing arrangements.

On October 14, 2021, the Company entered into a lease agreement for one Airbus A321 converted freighter. The ten-year lease term commenced on January 23, 2023. Under the agreement, the Company will pay the lessor a fixed monthly rent for 120 months, plus supplemental rent for maintenance of the aircraft.

On June 21, 2022, the Company entered into a lease agreement for one A321F cargo aircraft. The eight-year lease term commenced on August 1, 2023. Under the agreement, the Company will pay the lessor a fixed monthly rent for 94 months, plus supplemental rent for maintenance of the aircraft.

On December 14, 2022, the Company entered into a lease agreement for one A319 passenger aircraft. The two-year lease term commenced on August 18, 2023. Under the agreement, the Company will pay the lessor a fixed monthly rent for 24 months, plus supplemental rent for maintenance of the aircraft.

On January 27, 2023, the Company entered into a lease agreement for one A320 passenger aircraft. The six-year lease term commenced on April 21, 2023. Under the agreement, the Company will pay the lessor a fixed monthly rent for 72 months, plus supplemental rent for maintenance of the aircraft.

On May 22, 2023, the Company entered into a lease agreement for a commercial property warehouse. The five-year lease term commenced on June 1, 2023. Under the agreement, the Company will pay the lessor variable monthly rents increasing once every year for 62 months, plus estimated expenses for insurance, utilities, taxes, management fees and other operating expenses.

On June 16, 2023, the Company entered into a lease agreement for one A320 passenger aircraft. The four-year lease term commenced on November 13, 2023. Under the agreement, the Company will pay the lessor a fixed monthly rent for 48 months, plus supplemental rent for maintenance of the aircraft.

On August 8, 2023, the Company signed a lease agreement for an A320 passenger aircraft and paid commitment fees to the lessor. The lease will commence upon aircraft delivery which is expected to be in 2024 and will run through the next heavy maintenance visit reached (estimated to be in February 2028) from delivery date. In addition to basic rent due, the Company will pay the lessor supplemental rent for maintenance of aircraft equipment.

On September 8, 2023, the Company entered into a lease agreement for one A321F cargo aircraft. The eight-year lease term commenced on October 6, 2023. Under the agreement, the Company will pay the lessor a fixed monthly rent for 96 months, plus supplemental rent for maintenance of the aircraft.

On November 17, 2023, the Company signed a lease agreement for one A321 passenger aircraft and paid commitment fees to the lessor. The lease will commence upon aircraft delivery which is expected to be in 2025 and will run through 24 months from delivery date. In addition to basic rent due, the Company will pay the lessor supplemental rent for maintenance of the aircraft.

On November 20, 2023, the Company entered into a lease agreement for one A320 passenger aircraft. The seven-year lease term commenced on February 9, 2024. Under the agreement, the Company will pay the lessor a fixed monthly rent for 86 months, plus supplemental rent for maintenance of the aircraft.

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On December 22, 2023, the Company entered into a lease agreement for one A321F cargo aircraft. The ten-year lease commenced on March 8, 2024. Under the agreement, the Company will pay the lessor a fixed monthly rent for 120 months, plus supplemental rent for maintenance of the aircraft.

On January 19, 2024, the Company signed a lease agreement for one A320 passenger aircraft and paid commitment fees to the lessor. The lease will commence upon aircraft delivery which is expected to be in 2024 and will run through 96 months from delivery date. In addition to basic rent due, the Company will pay the lessor supplemental rent for maintenance of the aircraft.

On April 16, 2024, the Company entered into a lease agreement for one A320 passenger aircraft. The six-year lease commenced on April 17, 2024. Under the agreement, the Company will pay the lessor a fixed monthly rent for 72 months, plus supplemental rent for maintenance of the aircraft.

On April 29, 2024, the Company signed a lease agreement for one A321F passenger aircraft and paid commitment fees to the lessor. The lease will commence upon aircraft delivery which is expected to be in 2024 and will run through the next heavy maintenance visit on November 15, 2025. Following the expiration date, the aircraft is expected to undergo a passenger-to-freighter conversion and a second lease after completion which will run through an additional 102 months from redelivery date. In addition to basic rent due, the Company will pay the lessor supplemental rent for maintenance of the aircraft.

On April 29, 2024, the Company signed a lease agreement for one A321F cargo aircraft and paid commitment fees to the lessor. The lease will commence upon aircraft delivery which is expected to be in 2024 and will run through 102 months from delivery date. In addition to basic rent due, the Company will pay the lessor supplemental rent for maintenance of the aircraft.

The Company reviewed the operating leases for extension options that may be reasonably certain to be exercised and then would become part of the right-of-use assets and lease liabilities. On December 21, 2022, and October 10, 2023, the Company signed extensions for two aircraft extending their lease terms for an additional 60 and 15 months from original ending date of June 1, 2023, and October 1, 2023, to May 31, 2028, and December 31, 2024, respectively. In addition, on March 27, 2024 an additional extension was signed to extend aircraft lease term for an additional 74 months from previous extended ending date of December 31, 2024 to February 28, 2031. Terms of extensions were agreed solely to grant the Company the right to use the asset for the related additional time including no changes in payment rent. As such, extension was accounted as a modification of lease in accordance with ASC 842 rather than as a new contract and the Company remeasured at modification date the following: Right-of-use asset, lease liability, discount rate, lease term and classification. In addition, as of March 31, 2024, the Company signed a lease agreement to convert one of its lease passenger aircraft with lease term ending on November 1, 2024, into an Aircraft Freighter at lessor's expense. The new lease is contingent on a successful conversion from induction date of November 1, 2024, and can take up to a year. Among terms agreed includes commitment fees paid to lessor and also no basic and supplemental rent shall be payable while the Aircraft undergoes conversion during the period commencing on the conversion induction date and ending on the conversion redelivery date. The Company expects to record a new lease on the acceptance of redelivery date, which is the date the lessee will have access to the leased asset.

The following table provides details of the Company's future minimum lease payments under finance lease liabilities and operating lease liabilities recorded in thousands on the Company's condensed consolidated balance sheets as of June 30, 2024. The table does not include commitments that are contingent on events or other factors that are currently uncertain or unknown.

	Finance Leases		Operating Leases
Remainder of 2024	$	2,471	$	12,509
2025		5,122		24,535
2026		5,122		22,854
2027		5,013		20,936
2028		4,384		16,232
2029 and thereafter		8,485		44,412
Total minimum lease payments		30,597		141,478
Less amount representing interest		10,349		48,643
Present value of minimum lease payments		20,248		92,835
Less current portion		2,284		13,323
Long-term portion	$	17,964	$	79,512

The table below presents information for lease costs related to the Company's finance and operating leases in thousands:

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	For The Three Months Ended June 30,				For The Six Months Ended June 30,
	2024		2023		2024		2023
Finance lease cost
Amortization of leased assets	$	756	$	105	$	1,087	$	219
Interest of lease liabilities		733		101		1,042		202
Operating lease cost
Operating lease cost (1)		4,377		1,800		7,081		3,647
Total lease cost		5,866		2,006		9,210		4,068

(1) Expenses are classified within Aircraft Rent on the Company's condensed consolidated statements of operations.

The Company utilizes the rate implicit in the lease whenever it is easily determined. For leases where the implicit rate is not readily available, we utilize our incremental borrowing rate as the discount rate. The table below presents lease terms and discount rates related to the Company's finance and operating leases:

	June 30, 2024			June 30, 2023
Weighted-average remaining lease term
Operating leases	6.51 years			6.52 years
Finance leases	6.36 years			5.71 years
Weighted-average discount rate
Operating leases		13.87	%		12.12	%
Finance leases		14.62	%		12.16	%

The table below presents cash and non-cash activities associated with our leases:

	Six Months Ended June 30,
	2024		2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	6,838	$	3,669
Financing cash flows from finance leases		858		221

The Company is subject to various legal proceedings in the normal course of business and records legal costs as incurred. Management believes these proceedings will not have a materially adverse effect on the Company.

10. INCOME (LOSS) PER SHARE

Basic earnings per share, which excludes dilution, is computed by dividing Net Income (Loss) available to common stockholders by the weighted average number of common shares outstanding for the period. Diluted earnings per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock. The number of incremental shares from the assumed issuance of shares relating to share based awards is calculated by applying the treasury stock method.

The following table shows the computation of basic and diluted earnings per share for the three months ended June 30, 2024 and 2023 in thousands, except share and per share amounts:

	Three Months Ended June 30,
	2024		2023
Numerator:
Net income (loss)	$	284	$	(7,471	)
Denominator:
Weighted average common shares outstanding - Basic		60,008,779		56,857,629
Dilutive effect of stock options, RSUs and warrants		23,029,458		—
Weighted average common shares outstanding - Diluted		83,633,139		56,857,629
Basic earnings (loss) per share	$ 0.00		$	(0.13	)
Diluted earnings (loss) per share (1)	$ 0.00		$	(0.13	)

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The following table shows the computation of basic and diluted earnings per share for the six months ended June 30, 2024 and 2023 in thousands, except share and per share amounts:

	Six Months Ended June 30,
	2024			2023
Numerator:
Net loss	$	(6,095	)	$	(13,543	)
Denominator:
Weighted average common shares outstanding - Basic		59,621,946			55,680,815
Dilutive effect of stock options, RSUs and warrants		—			—
Weighted average common shares outstanding - Diluted		59,621,946			55,680,815
Basic loss per share	$	(0.10	)	$	(0.24	)
Diluted loss per share (1)	$	(0.10	)	$	(0.24	)

(1) There were 17,732,764 warrants, 246,667 options, and 5,179,222 RSUs outstanding at June 30, 2024 and there were 12,376,020 warrants, 470,668 options, and 4,772,923 RSUs outstanding at June 30, 2023. The Company excluded the warrants, options and RSUs from the calculation of diluted EPS for the six months ended June 30, 2024 and 2023 and three months ended June 30, 2023, as inclusion would have an anti-dilutive effect.

11. RELATED PARTY TRANSACTIONS

Related parties and related party transactions impacting the consolidated financial statements not disclosed elsewhere in these consolidated financial statements are summarized below and include transactions with the following individuals or entities.

As mentioned in footnote 3, on June 28, 2021, the Company completed the spin-out of Jetlines to GlobalX. GlobalX continues to provide back-office support including sharing the costs of the Company’s aircraft fleet management software (TRAX).

As of June 30, 2024 and 2023, amounts due to related parties include the following:

1.GlobalX earned $0 and $0 during the 3 and 6 months ended on June 30, 2024 and it was owed $0 and $0, respectively, in relation to flights flown and shared TRAX services with Jetlines, respectively. GlobalX earned $15 and $31 thousand during the 3 and 6 months ended on June 30, 2023 and it was owed $1 thousand in relation to flights flown and shared TRAX services with Jetlines, respectively;

2.Jetlines earned approximately $0.2 and $1.3 million during the 3 and 6 months ended on June 30, 2024, respectively, and it was owed $18 thousand, in relation to flights flown by Jetlines for GlobalX. Jetlines earned approximately $0 and $0 million during the 3 and 6 months ended on June 30, 2023, respectively, and it was owed $0, in relation to flights flown by Jetlines for GlobalX.

As described in footnote 4 above, on August 2, 2023, the Company issued Secured Notes of $35.5 million with entity of which its executive was elected Board of Directors' member of the Company during the last annual shareholders meeting in December 2023.

12. ACCRUED LIABILITIES

Accrued liabilities consisted of the following as of June 30, 2024 and December 31, 2023, in thousands.

	June 30, 2024		December 31, 2023
Salaries, wages and benefits	$	2,920	$	2,899
Passenger Taxes		4,611		2,317
Aircraft fuel		295		1,435
Contracted ground and aviation services		1,401		2,200
Maintenance		258		1,081
Aircraft Rent		3,376		3,384
Other		4,298		4,149
Accrued liabilities	$	17,159	$	17,465

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13. REVENUE CONTRACT LIABILITY

Deferred revenue for customer contracts represents amounts collected from, or invoiced to, customers in advance of revenue recognition. The balance of deferred revenue will increase or decrease based on the timing of invoices and recognition of revenue.

Significant changes in our deferred revenue liability balances during the period and year ended, June 30, 2024 and December 31, 2023, respectively, were as follows in thousands:

	June 30, 2024			December 31, 2023
Beginning Balance	$	9,896		$	3,201
Revenue Recognized		(13,845	)		(3,201	)
Amounts Collected or Invoiced		7,837			9,896
Ending Balance	$	3,888		$	9,896

The Company has 2 customers that accounted for approximately 55% and 48% of the revenue for the 3 and 6 months period ended on June 30, 2024 and approximately 6% and 7% of the revenue for the 3 and 6 months period ended on June 30, 2023. The Company expects to maintain these relationships with those customers.

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Item 2 - Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis should be read in conjunction with the Financial Statements included in Item 1 of this report. This Item 2 contains forward-looking statements that involve risks and uncertainties. Undue reliance should not be placed on these forward-looking statements, which speak only as of the date of this report. Actual results may differ materially from those expressed or implied in such forward-looking statements.

Background

Certain Terms - Glossary

The following represents terms and statistics specific to our business and industry. They are used by management to evaluate and measure operations, results, productivity, and efficiency.

ACMI	Service offering, whereby we provide outsourced cargo and passenger aircraft operating solutions, including the provision of an aircraft, crew, maintenance, and insurance, while customers assume fuel, demand and price risk. In addition, customers are generally responsible for landing, navigation and most other operational fees and costs
Block Hour	The time interval between when an aircraft departs the terminal until it arrives at the destination terminal
Charter	Service offering, whereby we provide cargo and passenger aircraft charter services to customers. The customer generally pays a fixed charter fee that includes fuel, insurance, landing fees, navigation fees and most other operational fees and costs
Net Available Aircraft	The number of aircraft available each month reduced by (netted) days the aircraft is unavailable due to various maintenance events or deliveries during a month
2Y Check	“Heavy” airframe maintenance checks, which are the most extensive in scope and are generally performed every two years and can take from 20 – 40 days to complete.
6Y Check	“Heavy” airframe maintenance checks, which are the most extensive in scope and are generally performed every six years and can take from 45-75 days to complete
12Y Check	“Heavy” airframe maintenance checks, which are the most extensive in scope and are generally performed every twelve years and can take from 60 – 100 days to complete
Heavy Maintenance	Scheduled maintenance activities that are extensive in scope and are primarily based on time or usage intervals, which include, but are not limited to 2Y Checks, 6Y Checks, 12Y Checks and engine overhauls. In addition, unscheduled engine repairs involving the removal of the engine from the aircraft are considered to be Heavy Maintenance.
Line Maintenance	Maintenance events occurring during normal day-to-day operations.
Non-heavy Maintenance	Discrete maintenance activities for the overhaul and repair of specific aircraft components, including landing gear, auxiliary power units and engine thrust reversers.
Utilization	The average number of Block Hours operated per day per aircraft.

Business Overview

GlobalX operates a US Part 121 domestic flag and supplemental airline using the Airbus A320 family of aircraft, operating both passenger and cargo aircraft. GlobalX’s business model is to (1) provide services on an ACMI using wet lease contracts to airlines and non-airlines, and (2) on a Charter basis whereby we provide passenger aircraft charter services to customers by charging an “all-in” fee that includes fuel, insurance, landing fees, navigation fees and most other operational fees and costs. GlobalX operates within the United States, Europe, Canada, Central and South America.

Business Strategy

GlobalX intends to become the best-in-class U.S. narrow-body, ACMI charter airline, operating both passenger and cargo charter aircraft while recruiting and maintaining a dynamic team of customer-centric flight crews, ground and maintenance teams and management staff.

GlobalX operates its A320 family aircraft for airlines, tour operators, college and professional sports teams, incentive groups, resorts and casino groups and government agencies. It is our goal to deliver best in class on time performance and dispatch reliability, expand existing relationships and develop additional relationships with leading charter/tour operators to provide aircraft during their peak seasons; and provide ad-hoc and track charter programs for non-airline customers.

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Business Developments

During the six months period ended June 30, 2024, the Company refocused the business back to GlobalX’s core competency – operating narrow body charter flights for both passengers and cargo. This led to the cancellation of several initiatives and the prioritization of adding aircraft to our operating certificate. Projects cancelled, include UrbanX, GlobalX Colombia, GlobalX Ecuador, adding ETOP’s capability, the acquisition of a wide body A330 aircraft and the development of a hangar facility at Fort Lauderdale Airport. Not only does the cancellation of these projects represent significant cash savings in 2024, but it also allows the team to devote efforts towards our stated goal: creating the largest narrow body charter operation in North America generating sustainable, long-term profits. To achieve this goal, GlobalX continues to invest in its three key assets–certifications, aircraft, and crew.

GlobalX achieved the following during the six months period ended June 30, 2024:

•Department of Transportation granted us economic authority to operate 20 aircraft, an increase from 16

•Took delivery of two A320 passenger aircraft and one A321F.

•Completed five heavy maintenance events and 12 non-heavy maintenance events.

•Hired and trained over 70 people in dispatch, crew scheduling, operation control center and maintenance, people required to operate the volume of flights anticipated over the remainder of 2024.

•Slightly increase pilot headcount from 134 to 136.

•Operated our first flight for the Department of Defense, a key customer representing an important milestone for GlobalX.

•Due to increasingly high demand in 2024, GlobalX also contracted over 1,200 block hours on other carriers to fulfill our customers’ missions.

The Passenger Charter Market

The passenger market continues to experience surging demand resulting in improved aircraft utilization and improved operating income. There are several factors, including the supply of aircraft, reduced direct competition, increased reliance on air charter by colleges and increased customer demand driving increased demand for our services. GlobalX anticipates the high level of demand will continue through the summer and well into 2025. To address this demand, the Company has prioritized passenger aircraft deliveries over cargo, devoted sales and operational resources to develop long term relationships with key customers and to expand the markets served as opportunities arise. Passenger charter services will be the economic engine for GlobalX in 2024.

The Cargo Charter Market

GlobalX believes in the longer term viability of the A321F (passenger to freighter) cargo aircraft. During Q1 2024, we had two aircraft offline, one for maintenance and, one for conformity. This left two operational aircraft, both of which generated lower than anticipated revenue. GlobalX attributed the softness of the market to several external factors including the rebid of the USPS contract, general economic conditions, and excess capacity in the North American freight market. In response to this slowdown during the quarter, the Company cancelled two aircraft deliveries, elected to take two A321’s as passenger rather than freighter and deferred two other cargo deliveries to 2025. GlobalX is working diligently to place the aircraft we have into long term ACMI contracts and continues to make progress establishing our reputation for on-time performance as the market better understands the capabilities of the A321F aircraft. While the Company cannot predict when the cargo market will recover, GlobalX has taken concrete steps to reduce our financial exposure in 2024 while expanding our customer base for the aircraft the Company does have.

GlobalX Aircraft Fleet

Critical to GlobalX’s business model is, a fleet of modern and cost-effective aircraft. To achieve this objective, GlobalX has selected what it believes is the best overall single-aisle aircraft family to operate. This approach differs from traditional airlines, which purchase a variety of aircraft, often from different manufacturers, to achieve their operational flight sectors, resulting in increased training, operating and spare part costs. GlobalX conducted research to determine the best aircraft to fly in competition with other narrow-body charter airlines in the single-aisle seat market and GlobalX selected the A320 aircraft family.

The following factors support GlobalX’s choice to operate the Airbus A320 and A321 aircraft versus the Boeing family of aircraft:

Cost and Operating factors: lower fuel burn, and better aircraft and cockpit crew pool availability.

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Operational Capability: the A320 has a range advantage over the 737-800 and can fly non-stop from Miami to selected airports in North America, South America, the Caribbean, and between most major destinations in Europe. The A320 has excellent maintenance dispatch reliability and strong availability of spare parts and components, making the A320, in management’s estimation, the most popular aircraft among low-cost airlines.

Passenger comfort: better seat width, cargo bin volume for carry-on baggage and cargo hold volume.

Aircraft Maintenance

Heavy maintenance checks are expected to continue to be outsourced to FAA-approved service providers. The 6Y and 12Y checks will be primarily paid for using funds from the accrued maintenance reserves paid to lessors under operating leases.

Strategy to Address Competitive Response

There have been significant changes to the competitive environment for US Charter operators in recent months. The liquidation of iAero (our largest competitor), the acquisition of Hillwood Airways by Eastern Airlines, the acquisition of iAero Assets by Eastern Airlines and Breeze Airways renewed focus on charter operations have all had a large impact on the charter market. It is our expectation that Eastern Airlines, with the assets acquired from iAero, will look to expand their business domestically. In response we are focusing on our core business, emphasizing on time performance, reinforcing our differentiation of our Airbus product and actively soliciting longer-term contracts with key customers.

Experienced management team

Our management team has extensive operating and leadership experience in the airfreight, airline, and aircraft leasing, maintenance, and management industries at companies such as JetBlue Airways, Virgin America, American Airlines, US Airways, Atlas Air, Breeze Airways, Miami Air, Spirit Airlines, Continental Airlines, Pan Am, and Flair Airlines, as well as the United States Army, and Air Force.

Results of Operations

The following discussion should be read in conjunction with our Financial Statements and other financial information appearing and referred to elsewhere in this report.

Revenue & Statistics

The following discussion should be read in conjunction with our Financial Statements and other financial information appearing and referred to elsewhere in this report.

The analysis of GlobalX results for the three and six-month periods ended on June 30, 2024 and 2023 requires an understanding of how the Company fundamentally evolved during that time period. 2023 was only our second year of full operations and was a period where the company was focused on securing new customers, entering new markets, and flying to new locations; primarily in the domestic and Caribbean markets.

By contrast in 2024, GlobalX is expanding on our existing relationships both domestically and internationally and grew operations in the ACMI market through increased focus on operating for government agencies. As the company grows, operational efficiency and margins are continuing to improve. Our key metric is block hours flown and block hours flown per available aircraft, which is the measure by which the Company tracks commercial activity. While other airlines discuss available seat miles and revenue per available seat mile (“rasm”), cost per available seat mile (“casm”), these metrics are not germane to our business model as an ACMI and Charter operator. GlobalX charters the entire aircraft, does not take fuel risk, and does not take third party risk therefore all results are evaluated on a block hour basis.

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Three months ended June 30, 2024 and 2023

The following table compares our Operating Fleet (average aircraft equivalents during the period) and total Block Hours operated:

	Three Months Ended June 30,
Operating Fleet	2024		2023		Inc/(Dec)			% Change
A319		1.0		—		1.0		N/A
A320		9.7		8.0		1.7			21.3	%
A321		5.7		2.7		3.0			111.1	%
Total Operating Average Aircraft Equivalents		16.4		10.7		5.7			53.3	%
Net Aircraft Available		14.4		7.8		6.6			83.9	%
Total Block Hours		6,591		3,585		3,006			83.8	%
Average Utilization per available aircraft		457.7		457.9		(0.2	)		0.0	%

The following table describes the degree to which variations in revenues in thousands can be attributed to fluctuations in prices and nature of GlobalX services.

	Three Months Ended June 30,
Revenue	2024		2023		Inc/(Dec)			% Change
Charter	$	24,616	$	25,126	$	(510	)	-2.0%
ACMI		31,911		5,766		26,145		453.4%
Other		1,019		583		436		74.8%
Total	$	57,546	$	31,475	$	26,071		82.8%
Block Hours
Charter		1,575		2,209		(634	)	-28.7%
ACMI		4,824		1,362		3,462		254.2%
Non Revenue		192		14		178		1271.4%
Total		6,591		3,585		3,006		83.8%
Revenue per Block Hour
Charter		15.6		11.4		4.2		36.8%
ACMI		6.6		4.2		2.4		57.1%

Charter revenue for the period decreased $0.5 million or 2.0%, from $25.1 million in 2023 to $24.6 million in 2024. Charter block hours decrease 28.7% from 2,209 to 1,575 resulting in a $7.2 million reduction which was primarily offset by the rate for Charter flying which increased 36.8% from $11,374 per block hour to $15,629 per block hour resulting in a $6.7 million impact. The increase in the rate per block hour is primarily driven by high market demand and a shortage of supply as competitors reduced capacity to increase demand, higher fuel and handling fees and the mix of flying. The decrease in charter block hours was due to the increase in the number of aircraft in the ACMI segment.

ACMI revenue for the period increased by $26.1 million or 453.4% from $5.8 million in 2023 to $31.9 million in 2024. This variance is primarily driven by an 83.9% increase in the number of available aircraft which resulted in an increase from 1,362 block hours in 2023 to 4,824 block hours in 2024, an increase of 254.5% or 3,463 block hours. This volume accounted for 56.1% or $14.7 million of the revenue increase. The average revenue per block hour increased $2,382 per block hours from $4,233 per block hour in 2023 to $6,615 per block hour in 2024 and accounted for $11.5 million or 43.9% of the revenue increase. The primary driver for the increase was related to both high market demand and a shortage of supply as competitors reduce capacity.

Other revenue for the period increased by $0.4 million from $0.6 million in 2023 to $1.0 million in 2024. The increase is primarily driven by additional ancillary services provided to our customers.

21

Operating Expenses

The following table compares our Operating Expenses (in thousands):

	Three Months Ended June 30,
Operating Expenses	2024		2023		Inc/(Dec)			% Change
Salaries, Wages, & Benefits	$	16,745	$	12,140	$	4,605			37.9	%
Aircraft Fuel		5,601		6,087		(486	)		-8.0	%
Maintenance, materials and repairs		2,645		1,767		878			49.7	%
Depreciation and amortization		1,444		443		1,001			226.0	%
Contracted ground and aviation services		4,757		5,201		(444	)		-8.5	%
Travel		3,118		1,347		1,771			131.5	%
Insurance		1,554		1,245		309			24.8	%
Aircraft Rent		14,762		6,830		7,932			116.1	%
Other		4,377		3,191		1,186			37.2	%
Total Operating Expenses	$	55,003	$	38,251	$	16,752			43.8	%

Salaries, wages, and benefits increased $4.6 million from $12.2 million to $16.7 million, or 37.9%, primarily due to the hiring and training of pilots and other airline personnel necessitated by the growing fleet and operations. The total employees grew 14.1% from 581 to 663 and pilots increased from 114 to 136, or 19.2%. Increase in block hours of 83.8% drove $10.2 million increase, offset by $5.6 million due to a reduction in rate per block hour of 25.0%.

Aircraft fuel decreased by $0.5 million, from $6.1 million to $5.6 million, or 8.0%, primarily due to the volume of non-ACMI block hours which decreased 8.6% or $0.5 million. This was partially offset by an increase in fuel prices by 0.7%.

Maintenance, materials, and repairs increased by $0.9 million, from $1.8 million to $2.6 million, or 49.7%. $1.5 million increase was primarily due to volume from the increase in both the number of aircraft and the number of block hours flown which increased 3,006 or 83.8% from 3,585 to 6,591 block hours. This was primarily offset by $0.6 million due to the rate per block hour improvement of 18.6% from $493 per block hour to $401 per block hour.

Depreciation and amortization increased $1.0 million, from $0.4 million to $1.4 million or 226.0%, driven by assets acquired to support our airport operations. These assets include, but are not limited to, aircraft deliveries secured on capital leases, computers, software, and rotable inventory.

Contracted ground and aviation services decreased by $0.4 million from $5.2 million to $4.8 million, or 8.5%, These costs are directly correlated to the number of Charter hours operated. A $1.5 million reduction was primarily driven by the decrease in charter block hours by 28.7%. This was offset by $1.1 million primarily due to an increase in rate by 28.2%.

Travel increased $1.8 million, from $1.3 million to $3.1 million or 131.5%, this increase was driven by increased activity at newly created bases to support new customers resulting in additional hotel, flight and meal costs.

Insurance increased $0.3 million, from $1.2 million to $1.5 million or 24.8%, primarily related to the increase in the number of aircraft.

Aircraft rent increased $7.9 million, from $6.8 million to $14.8 million or 116.1%, primarily due to the increase in the number of aircraft from 10.7 to 16.4 aircraft in the fleet. $3.6 million or 45.9% of the increase is driven by the increase in the number of aircraft being leased, with the remaining $4.3 million or 54.1% due to rate increase per aircraft and short-term ACMI leases from other airlines due to flights sold exceeded capacity available during the period.

Operating income/loss increased $9.3 million, from an operating loss of $6.8 million to an operating profit of $2.5 million. This was a direct result of GlobalX’s ability to grow its revenue faster than its cost structure as the airline works towards achieving scale and profitability. There are several factors driving the improved margins. The first factor is rates as the Company was able to secure higher rates for both ACMI and Charter contracts. The Company’s ACMI rate grew 57.1%, from $4,233 per block hour to $6,615 per block hour, while Charter rate per block hour is up 36.8% from $11,374 per block hour to $15,629 per block hour. The second factor is scale. As an example, when measured on a per block hour basis, Salaries, wages, and benefits dropped from $3,386 to $2,507 per block hour, a 25% reduction. There were also savings on a per block hour basis in fuel, maintenance, insurance, and general overhead expenses (other) which combined with the other factors drove the improvement.

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Non-operating Expenses

The following table compares our Non-operating Expenses (in thousands) :

	Three Months Ended June 30,
Non-Operating Expenses (Income)	2024		2023		Inc/(Dec)		% Change
Interest Expense	$	2,258	$	695	$	1,563		224.9	%
Total Non-Operating Expenses (Income)	$	2,258	$	695	$	1,563		224.9	%

Interest expense, net increased $1.6 million from $0.7 million to $2.2 million driven mainly by the interest payable on the debentures issued in 2023.

Net Income/Loss

Net Income/Loss increased by $7.8 million, from a net loss of $7.5 million in 2023 to net income of $0.3 million in 2024. Net income/loss as a percentage improved 103.8%. This was a direct result of GlobalX’s ability to grow its revenue quicker than its cost structure as the airline works towards achieving scale and profitability. There are several factors driving the improved margins. The first factor is rates as the Company was able to secure higher rates for both ACMI and Charter contracts. The Company’s ACMI rate grew 57.1%, from $4,233 per block hour to $6,615 per block hour, while Charter rate per block hour is up 36.8% from $11,374 to $15,629 per block hour. The second factor is scale. As an example, when measured on a per block hour basis, Salaries, wages, and benefits dropped from $3,386 to $2,507 per block hour, a 26.0% reduction. There were also savings on a per block hour basis in fuel, maintenance, insurance, and general overhead expenses (other) which combined with the other factors drove the improvement.

Six months ended June 30, 2024 and 2023

The following table compares our Operating Fleet (average aircraft equivalents during the period) and total Block Hours operated:

	Six Months Ended June 30,
Operating Fleet	2024		2023		Inc/(Dec)		% Change
A319		1.0		—		1.0	N/A
A320		9.0		7.5		1.5		20.0	%
A321		5.3		2.3		3.0		130.4	%
Total Operating Average Aircraft Equivalents		15.3		9.8		5.5		56.1	%
Net Aircraft Available		13.2		8.0		5.2		65.0	%
Total Block Hours		11,791		6,719		5,072		75.5	%
Average Utilization per available aircraft		893.3		839.9		53.4		6.4	%

The following table describes the degree to which variations in revenues in thousands can be attributed to fluctuations in prices and nature of GlobalX services.

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	Six Months Ended June 30,
Revenue	2024		2023		Inc/(Dec)			% Change
Charter	$	58,631	$	51,554	$	7,077		13.7%
ACMI		50,533		10,986		39,547		360.0%
Other		2,216		1,086		1,130		104.1%
Total	$	111,380	$	63,626	$	47,754		75.1%
Block Hours
Charter		3,739		4,160		(421	)	-10.1%
ACMI		7,734		2,536		5,198		205.0%
Non Revenue		318		23		295		1282.6%
Total		11,791		6,719		5,072		75.5%
Revenue per Block Hour
Charter		15.7		12.4		3.3		26.6%
ACMI		6.5		4.3		2.2		51.2%

Charter revenue for the period increased $7.1 million or 13.7%, from $51.6 million in 2023 to $58.6 million in 2024. The rate for Charter flying increased 26.6% from $12,393 per block hour to $15,680 per block hour resulting in a $12.3 million increase. This was offset by a $5.2 million reduction due to charter block hours decreasing 10.1% from 4,160 to 3,739 block hours. The increase in the rate per block hour is primarily driven by high market demand and a shortage of supply as competitors reduced capacity to increase demand, higher fuel and handling fees and the mix of flying. The decrease in charter block hours was due to the increase in the number of aircraft in the ACMI segment.

ACMI revenue for the period increased by $39.5 million or 360.0% from $11.0 million in 2023 to $50.5 million in 2024. This variance is driven by an increase from 2,536 block hours in 2023 to 7,734 block hours in 2024, an increase of 205.0% or 5,198 block hours. This volume accounted for 56.9% or $22.5 million of the increase. The average revenue per block hour increased $2,202 per block hours from $4,332 per block hour in 2023 to $6,534 per block hour in 2024 and accounted for $17.0 million or 43.1% of the revenue increase. The primary driver for the increase was related to both high market demand and a shortage of supply as competitors reduce capacity.

Other revenue for the period increased by $1.1 million from $1.1 million in 2023 to $2.2 million in 2024. The increase is primarily driven by ancillary services provided to our customers.

Operating Expenses

The following table compares our Operating Expenses (in thousands):

	Six Months Ended June 30,
Operating Expenses	2024		2023		Inc/(Dec)			% Change
Salaries, Wages, & Benefits	$	33,520	$	23,308	$	10,212			43.8	%
Aircraft Fuel		13,800		14,036		(236	)		-1.7	%
Maintenance, materials and repairs		5,578		3,326		2,252			67.7	%
Depreciation and amortization		2,609		886		1,723			194.5	%
Contracted ground and aviation services		11,660		10,054		1,606			16.0	%
Travel		6,969		3,601		3,368			93.5	%
Insurance		3,188		2,370		818			34.5	%
Aircraft Rent		27,523		12,474		15,049			120.6	%
Other		8,609		5,995		2,614			43.6	%
Total Operating Expenses	$	113,456	$	76,050	$	37,406			49.2	%

Salaries, wages, and benefits increased $10.2 million from $23.3 million to $33.5 million, or 43.8%, primarily due to the hiring and training of pilots and other airline personnel necessitated by the growing fleet and operations. The total employees grew 14.1% from 581 to 663 and pilots increased from 114 to 136, or 19.2%. A block hour increase of 75.5% drove $17.6 million increase, offset by $7.4 million due to a reduction in rate per block hour of 18.0%.

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Aircraft fuel decreased by 1.7% to $13.8 million, the volume of non-ACMI block hours increased by 14.6% or $2.1 million. This was primarily offset by a decrease in base jet fuel of approximately 14.2% or $2.3 million.

Maintenance, materials, and repairs increased by $2.3 million, from $3.3 million to $5.6 million, or 67.7%. $2.5 million of the increase was primarily due to volume from the increase in both the number of aircraft to 17 and the number of block hours flown which increased 83.8% from 3,585 to 6,591 block hours. This was primarily offset by $0.3 million due to the rate per block hour improvement of 4.4% from $495 per block hour to $473 per block hour.

Depreciation and amortization increased $1.7 million, from $0.9 million to $2.6 million or 194.54%, driven by assets acquired to support our airport operations. These assets include, but are not limited to, aircraft deliveries secured on capital leases, computers, software, and rotable inventory.

Contracted ground and aviation services increased by $1.6 million from $10.1 million to $11.7 million, or 16.0%. A rate increase or 29% per block hour drove an increase of $2.6 million. This was partially offset by lower charter block hour by 10.1% drove a reduction of $1.0 million.

Travel increased $3.4 million, from $3.6 million to $7.0 million or 93.5%, $2.7 million was driven by the 75.5% increase in block hours. The remaining $0.7 million variance is driven rate increase by 10.3%, caused by higher flying at outstations, thus raising hotel and meal cost for crews on missions.

Insurance increased $0.8 million, from $2.4 million to $3.2 million or 34.5%, primarily related to the increase in the number of aircraft.

Aircraft rent increased $15.0 million, from $12.5 million to $27.5 million or 120.6%, primarily due to the increase in the number of aircraft from 10 to 17 aircraft in the fleet. $7.0 million or 46.5% of the increase is driven by the increase in the number of aircraft being leased, with the remaining $8.0 million or 53.5% due to rate increase per aircraft and short-term ACMI leases from other airlines due to flights sold exceeded capacity available during the period.

Operating loss decreased $10.3 million, from an operating loss of $12.4 million to $2.1 million, or 83.3% improvement. In addition, operating loss as a percentage of revenue improved from (19.5%) to (1.9%), a 17.7% improvement. This was a direct result of GlobalX’s ability to grow its revenue faster than its cost structure as the airline works towards achieving scale and profitability. There are several factors driving the improved margins. The first factor is rates as the Company was able to secure higher rates for both ACMI and Charter contracts. The Company’s ACMI rate grew 51.2%, from $4,332 per block hour to $6,534 per block hour, while Charter rate per block hour is up 26.6% from $12,393 per block hour to $15,680 per block hour. The second factor is utilization as our average utilization per available aircraft grew 6.4%. The third factor is scale. As an example, when measured on a per block hour basis, Salaries, wages, and benefits dropped from $3,469 to $2,824 per block hour, a 18.6% reduction. There were also savings on a per block hour basis in fuel, Maintenance, insurance, and general overhead expenses (other) which combined with the other factors drove the improvement.

Non-operating Expenses

The following table compares our Non-operating Expenses (in thousands):

	Six Months Ended June 30,
Non-Operating Expenses (Income)	2024		2023		Inc/(Dec)		% Change
Interest Expense	$	4,018	$	1,119	$	2,899		259.1	%
Total Non-Operating Expenses (Income)	$	4,018	$	1,119	$	2,899		259.1	%

Interest expense, net increased $2.9 million from $1.1 million to $4.0 million driven mainly by the interest payable on the debentures issued in 2023.

Net Loss

Net Loss decreased by $7.4 million or 55.0%, from a net loss of $13.5 million in 2023 to $6.1 million in 2024. Net loss as a percentage improved from (21.3%) to (5.5%), an 15.8% improvement. This was a direct result of GlobalX’s ability to grow its revenue quicker than its cost structure as the airline works towards achieving scale and profitability. There are several factors driving the improved margins. The first factor is rates as the Company was able to secure higher rates for both ACMI and Charter contracts. The Company’s ACMI rate grew 51.2%, from $4,332 per block hour to $6,534 per block hour, while Charter rate per block hour is up 26.6% from $12,393 per block hour to $15,680 per block hour. The second factor is utilization as our average utilization per available aircraft grew 6.4%. The

25

third factor is scale. As an example, when measured on a per block hour basis, Salaries, wages, and benefits dropped from $3,469 to $2,824 per block hour, a 18.6% reduction. There were also savings on a per block hour basis in fuel, maintenance, insurance, and general overhead expenses (other) which combined with the other factors drove the improvement.

Liquidity and Capital Resources

As of June 30, 2024, the Company had approximately $8.0 million in unrestricted cash and cash equivalents and approximately $2.4 million in restricted cash, a decrease of approximately $3.5 million and $3.7 million from December 31, 2023, respectively primarily due to new aircraft deliveries, deposits, and net loss in operations. Management is confident that the augmented cash and cash equivalents, coupled with the anticipated rise in sales linked to the Company’s strategies to attract more funds, will adequately address the Company’s liquidity requirements. Management is actively assessing various options to procure additional funds, including exploring opportunities for additional equity or debt financing.

Net Cash used in operating activities during the six months ended June 30, 2024 decreased $4.9 million to $1.2 million, consisting primarily of $6.8 million of increase in accrued liabilities and other liabilities, $6.1 million of net loss, $6.8 million of increase in operating leases obligations, and $0.3 million of increase in assets held for sale. These were partially offset by $2.5 million of increase in accounts payable, $10.0 million in noncash adjustments for depreciation and amortization of fixed assets, operating lease right of use assets and debt issue costs, $3.3 million of increase in accounts receivable, $0.5 million of increase in prepaid expenses and other current assets, $0.4 million of bad debt expense and $0.9 million of share-based payments. Net Cash provided by operating activities during the six months ended June 30, 2023 increased $9.8 million to $3.6 million, consisting primarily of $13.5 million of net loss, $2.9 million of increase of accounts receivable, $0.7 million of increase in prepaid expenses and other current assets and $3.7 million of decrease of operating lease obligations. These were partially offset by $12.7 million of increase of accrued liabilities and other liabilities, $4.8 million of increase in accounts payable and $5.0 million in noncash adjustments for depreciation and amortization of fixed assets, operating lease right of use assets and debt issue costs, and $1.1 million of share-based payments.

The Company has significant fixed and noncancelable lease commitments of aircraft, equipment and related maintenance checks. As of June 30, 2024, the Company had total of $15.6 million due in the next 12 months of future minimum lease payments under finance and operating leases. As of June 30, 2024, the Company had total of $97.5 million due after 12 months from the balance sheet date of future minimum lease payments under finance and operating leases, and approximately $29 million in notes payable included in the non-current liabilities presented in the Company’s consolidated balance sheet. The Company ended the period of April 1 to June 30, 2024 with thirteen passenger aircraft and four cargo aircraft and expects the fleet to increase to 16 and 22 passenger aircraft and six cargo aircraft by the end of 2024 and 2025, respectively. To achieve the number of aircraft deliveries in 2024 and 2025, the Company currently has eight aircrafts under lease with partial or total deposit paid.

During the six months ended June 30, 2024, net cash used for investing activities increased $1.2 million to $5.2 million, consisting of $3.7 million of Purchases of property and equipment and $1.6 million of increase of deposit, deferred costs and other assets. During the six months ended June 30, 2023, net cash used for investing activities increased $1.3 million to $4.0 million, consisting of $3.0 million of of Purchases of property and equipment and $1.0 million increase of deposit, deferred costs and other assets.

During the six months ended June 30, 2024, net cash provided by financing activities decreased $4.2 million to $0.8 million of net cash used in financing activities, consisting of $0.9 million of Principal payments on finance leases and $0.1 million of Dividends, partially offset by Proceeds on issuance of shares of $0.2 million. During the six months ended June 30, 2023, net cash provided by financing activities decreased $3.0 million to $3.4 million, consisting of $2.0 million of Proceeds from note payable, $1.6 million of Proceeds on issuance of shares, partially offset by $0.2 million of Principal payments on finance leases.

The Company continuously seeks to identify external sources of capital from time to time depending on our cash requirements, assessment of current and anticipated market conditions, and the after-tax cost of capital. Our access to capital markets can be adversely impacted by prevailing economic conditions and by financial, business and other factors, some of which are beyond our control. Additionally, the Company’s borrowing costs are affected by market conditions and may be adversely impacted by a tightening in credit markets.

The Company regularly assesses our anticipated working capital needs, debt and leverage levels, debt maturities, capital expenditure requirements and future investments or acquisitions to maximize shareholder return, efficiently finance our ongoing operations and maintain flexibility for future strategic transactions. The Company also regularly evaluates its liquidity and capital structure to ensure financial risks, adequate liquidity access and lower cost of capital are efficiently managed.

Item 3 – Quantitative and Qualitative Disclosures about Market Risk

Not applicable.

26

Item 4 – Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our Executive Chairman and President & Chief Financial Officer, referred to collectively herein as the Certifying Officers, are responsible for establishing and maintaining our disclosure controls and procedures that are designed to ensure that information relating to the Company required to be disclosed in the reports that the Company files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, including ensuring that such information is accumulated and communicated to the Company’s management, including the Executive Chairman and the President & Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

The Certifying Officers have reviewed and evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 240.13a-15(e) and 15d-15(e) promulgated under the Securities Exchange Act of 1934) as of June 30, 2024. Our Executive Chairman and President & Chief Financial Officer concluded that, as of June 30, 2024, the Company’s disclosure controls and procedures were not effective, due to the material weaknesses in internal control over financial reporting described below.

Material Weakness in Internal Control over Financial Reporting

1.Insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of U.S. generally accepted accounting principles (“GAAP”) and SEC disclosure requirements.

Remediation Plans

In order to mitigate the foregoing material weakness, the Company plans to take steps to develop and enhance its internal controls over financial reporting in the remainder of 2024, including:

1.Developing formal policies and procedures over accounting and reporting disclosure requirements.

2.Provide additional training on application of US GAAP and SEC disclosure requirements.

3.Obtain checklists to ensure all application disclosures required under US GAAP and SEC requirements are included in each filing.

As we continue to evaluate and work to improve our internal control over financial reporting, Certifying officers and management may determine that additional measures to address control deficiencies or modifications to the remediation plan are necessary. Therefore, we cannot assure you when the Company will remediate the material weakness identified above, nor can we be certain that additional actions will not be required and what the costs of any such additional actions may be. Moreover, we cannot assure you that additional material weaknesses will not arise in the future.

Notwithstanding the material weakness identified in our internal control over financial reporting, we believe that the consolidated financial statements in this quarterly report fairly present, in all material respects, the Company’s consolidated financial condition as of June 30, 2024 and consolidated results of its operations and cash flows for the period then ended, in conformity GAAP.

Changes in Internal Control Over Financial Reporting

There has been no change in the Company’s internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during the period ended June 30, 2024 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

27

PART II - OTHER INFORMATION

ITEM 1 Legal Proceedings

On August 11, 2023 Global Crossing Airlines in combination with Top Flight Charters and its minority interest member filed a lawsuit in the United States District Court Southern District of Florida against Shorts Travel Management, Inc (Shorts) and STM Charters, Inc. seeking (1) to have an old non-solicit agreement signed by Top Flight' minority interest member to be declared invalid, (2) a declaration that Shorts alleged trade secrets do not exist and (2) damages arising from the Shorts defamation per se based on numerous false statements made by Shorts in the marketplace. On October 4, 2023, Shorts responded in court by denying the claims made and countersued all parties for breach of contract and theft of trade secrets. This case was settled with no financial impact to GlobalX.

ITEM 2 Unregistered Sales of Equity Securities and Use of Proceeds

None.

ITEM 3 Defaults Upon Senior Securities

None.

ITEM 4 Mine Safety Disclosures

Not Applicable

ITEM 5 Other Information

None.

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Item 6 - Exhibits

Exhibit Number	Description
31.1*	Rule 13a-14(a)/15d-14(a) Certification of acting principal executive officer. *
31.2*	Rule 13a-14(a)/15d-14(a) Certification of acting principal financial officer. *
32.1*	Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*
32.2*	Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*
101.INS	Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File as its XBRL tags are embedded within the Inline XBRL document.
101.SCH	Inline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents.
104	Cover Page Interactive Data File (embedded within the Inline XBRL document).

* Filed herewith.

29

SIGNATURES

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

SIGNATURE	TITLE	DATE
/s/ Ryan Goepel	President - CFO	August 14, 2024
/s/ Chris Jamroz	Executive Chairman	August 14, 2024
/s/ Ed Wegel	Director	August 14, 2024
/s/ Alan Bird	Director	August 14, 2024
/s/ T. Allan McArtor	Director	August 14, 2024
/s/ Deborah Robinson	Director	August 14, 2024
/s/ Cordia Harrington	Director	August 14, 2024

30