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

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

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.

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 ~~September~~April 30, ~~2022~~2023 was ~~52,573,938~~56,720,074 shares, consisting of ~~31,660,576~~37,965,552 shares of common stock, 5,537,313 shares of Class A Non-Voting Common Stock and ~~15,376,049~~13,217,209 shares of Class B Non-Voting Common Stock.


	September 30, 2022			December 31, 2021			March 31, 2023			December 31, 2022
	(Unaudited)						(Unaudited)
Current Assets
Cash and cash equivalents	$	2,875,901		$	5,241,716		$	2,200,686		$	1,875,673
Restricted cash	$	4,933,714		$	2,752,285		$	5,026,968		$	3,585,261
Accounts receivable, net of allowance	$	1,453,984		$	745,646		$	3,992,347		$	2,664,174
Prepaid expenses and other current assets	$	2,170,078		$	848,490		$	2,314,057		$	2,193,449
Current assets held for sale							$	1,149,893		$	1,405,741
Total Current Assets	$	11,433,677		$	9,588,137		$	14,683,951		$	11,724,298
Property and equipment, net	$	1,669,749		$	618,883		$	2,551,930		$	2,441,288
Finance leases, net	$	2,741,063		$	—		$	3,834,109		$	2,710,899
Operating lease right-of-use assets	$	24,677,532		$	22,668,308		$	42,314,668		$	27,952,609
Deferred costs and other assets	$	9,400,590		$	6,198,338
Deposits and other assets							$	7,025,696		$	6,334,878
Total Assets	$	49,922,611		$	39,073,666		$	70,410,354		$	51,163,973

Current liabilities
Accounts payable	$	6,673,457		$	3,574,186		$	5,355,869		$	4,997,080
Accrued liabilities	$	5,173,713		$	2,704,169		$	11,485,746		$	9,458,629
Deferred revenue	$	4,782,831		$	1,995,090		$	5,477,557		$	3,200,664
Customer deposits	$	2,284,000		$	1,264,502		$	2,272,720		$	1,617,337
Due from related parties	$	—		$	197,558
Current portion of notes payable	$	1,573,000		$	1,573,000		$	1,811,668		$	1,810,468
Current portion of operating leases	$	6,165,322		$	3,393,497
Current portion of long-term operating leases							$	7,271,902		$	6,445,915
Current portion of finance leases	$	317,423		$	—		$	461,867		$	335,527
Total current liabilities	$	26,969,746		$	14,702,002		$	34,137,329		$	27,865,621
Other liabilities
Note payable	$	4,184,188		$	—		$	7,831,750		$	5,081,294
Long-term operating leases	$	20,102,218		$	20,042,343		$	36,759,367		$	23,189,835
Long-term financial leases	$	2,148,431		$	—
Other liabilities	$	83,498		$	83,491		$	3,305,093		$	2,282,892
Total other liabilities	$	26,518,335		$	20,125,834		$	47,896,210		$	30,554,020
Commitments and Contingencies							$	—		$	—
Equity (Deficit)
Common stock - $.001 par value; 200,000,000 authorized; 52,573,938 and 51,237,876 issued and outstanding as of September 30, 2022 and December 31, 2021	$	52,574		$	51,237
Common stock - $.001 par value; 200,000,000 authorized; 56,298,351 and 53,440,482 issued and outstanding as of March 31, 2023 and December 31, 2022, respectively							$	56,297		$	53,440
Additional paid-in capital	$	30,025,791		$	26,456,900		$	32,475,526		$	30,774,197
Retained deficit	$	(33,643,835	)	$	(22,262,307	)	$	(44,155,008	)	$	(38,083,304	)
Total stockholders’ equity (Deficit)	$	(3,565,470	)	$	4,245,830		$	(11,623,185	)	$	(7,255,667	)
Total Liabilities and Equity (Deficit)	$	49,922,611		$	39,073,666		$	70,410,354		$	51,163,973


	Three Months Ended		Three Months Ended			Nine Months Ended			Nine Months Ended			Three Months Ended			Three Months Ended
	September 30, 2022		September 30, 2021			September 30, 2022			September 30, 2021			March 31, 2023			March 31, 2022
Operating Revenue	$	30,790,240	$	3,123,946		$	64,612,231		$	3,123,946		$	32,150,554		$	16,380,011
Operating Expenses
Salaries, Wages, & Benefits		7,712,688		2,558,017			20,829,632			5,048,218			11,167,593			5,865,074
Aircraft Fuel		7,764,761		834,313			15,402,450			998,331			7,948,962			3,250,554
Maintenance, materials and repairs		1,218,221		232,400			3,373,396			454,635			1,558,724			1,190,823
Depreciation and amortization		193,620		7,100			296,830			15,484			443,139			23,312
Contracted ground and aviation services		4,631,741		623,637			10,674,340			806,033			4,852,811			2,955,576
Travel		1,078,854		327,997			3,204,172			391,320			2,253,833			1,295,110
Insurance		947,342		481,678			2,713,791			1,424,400			948,781			857,268
Aircraft Rent		3,957,508		1,083,260			11,151,412			1,914,041			5,644,028			3,359,674
Other		2,489,530		2,232,978			7,464,756			5,000,740			2,862,672			2,345,908
Total Operating Expenses		29,994,265		8,381,380			75,110,779			16,053,202			37,680,543			21,143,299
Operating Income/(Loss)		795,975		(5,257,434	)		(10,498,548	)		(12,929,256	)
Non-Operating Expenses (Income)
Loss (Gain) on Warrant Valuation		—		—			—			2,650,772
Unrealized Loss (Gain) on Financial Instruments		—		82,529			(15	)		(73,037	)
Equity method investment activity		—		(20,478	)		—			(20,478	)
Interest Expense (Income)		632,344		(56,065	)		882,990			27,081
Operating Loss													(5,529,989	)		(4,763,288	)
Non-Operating Expenses
Interest Expense													541,715			16,214
Total Non-Operating Expenses		632,344		5,986			882,975			2,584,338			541,715			16,214
Loss from continuing operations		163,631		(5,263,420	)		(11,381,523	)		(15,513,594	)
Income from Discontinued Operations		—		—			—			177,706
Loss before income taxes		163,631		(5,263,420	)		(11,381,523	)		(15,335,888	)		(6,071,704	)		(4,779,502	)
Income tax expense		—		—			—			—			—			—
Net Income (Loss)		163,631		(5,263,420	)		(11,381,523	)		(15,335,888	)
Other comprehensive loss
Foreign currency translation adjustments		—		(164,738	)		—			(164,738	)
Comprehensive loss		163,631		(5,428,158	)		(11,381,523	)		(15,500,626	)
Net Loss													(6,071,704	)		(4,779,502	)
Loss per share:
Basic	$	0.00	$	(0.10	)	$	(0.22	)	$	(0.35	)	$	(0.11	)	$	(0.09	)
Diluted	$	0.00	$	(0.10	)	$	(0.22	)	$	(0.35	)	$	(0.11	)	$	(0.09	)
Weighted average number of shares outstanding		52,569,481		50,431,295			51,776,833			43,572,925			54,490,925			51,241,326
Fully diluted shares outstanding		76,507,900		50,431,295			51,776,833			43,572,925			54,490,925			51,241,326


	Common Stock Number of Shares		Amount		Common Stock Subscribed			Additional Paid in Capital			Accumulated Other Comprehensive Loss			Retained Deficit			Total

Beginning – January 1, 2021		28,938,060	$	28,938	$	452,269		$	2,264,966		$	—		$	(2,443,794	)	$	302,379
Issuance of shares – private placement		8,064,517		8,064		(212,073	)		4,773,698			—			—			4,569,689
Issuance of shares – warrants and options exercised		1,050,740		1,051		(100,000	)		517,759			—			—			418,810
Issuance of shares – RSUs		40,000		40		—			(40	)		—			—			—
Share based compensation on stock options or RSUs		—		—		—			120,411			—			—			120,411
Loss for the period		—		—		—			—			—			(5,974,924	)		(5,974,924	)
Ending – March 31, 2021		38,093,317	$	38,093	$	140,196		$	7,676,794		$	—		$	(8,418,718	)	$	(563,635	)
Issuance of shares – private placement		7,537,313	$	7,537		—			9,992,462			—			—			9,999,999
Issuance of shares – warrants and options exercised		4,474,138		4,474		(140,196	)		3,807,067			—			—			3,671,345
Share based compensation on stock options or RSUs		—		—		—			164,574			—			—			164,574
GEM warrants write-off		—		—		—			3,475,379			—			—			3,475,379
Loss for the period		—		—		—			—			—			(4,097,544	)		(4,097,544	)
Ending – June 30, 2021		50,104,768	$	50,104	$	—		$	25,116,276		$	—		$	(12,516,262	)	$	12,650,118
Issuance of shares – warrants and options exercised		357,999	$	358		—			89,142			—			—			89,500
Share based compensation on stock options or RSUs		—		—		—			280,903			—			—			280,903
Loss for the period		—		—		—			—			—			(5,263,420	)		(5,263,420	)
Other comprehensive income		—		—		—			—			(164,738	)		—			(164,738	)
Ending – September 30, 2021		50,462,767	$	50,462	$	—		$	25,486,321		$	(164,738	)	$	(17,779,682	)	$	7,592,363
																				Common Stock Number of Shares		Amount		Additional Paid in Capital		Retained Deficit			Total
Beginning – January 1, 2022		51,237,876	$	51,237	$	—		$	26,456,900		$	—		$	(22,262,307	)	$	4,245,830			51,237,876	$	51,237	$	26,456,900	$	(22,262,307	)	$	4,245,830
Issuance of shares – warrants and options exercised		20,700		21		—			9,909			—			—			9,930			20,700		21		9,909		—			9,930
Warrants issued									2,130,642			—						2,130,642							2,130,642					2,130,642
Share based compensation on stock options or RSUs		—		—		—			382,612			—			—			382,612			—		—		382,612		—			382,612
Loss for the period		—		—		—			—			—			(4,779,502	)		(4,779,502	)		—		—		—		(4,779,502	)		(4,779,502	)
Ending – March 31, 2022		51,258,576	$	51,258	$	—		$	28,980,063		$	—		$	(27,041,809	)	$	1,989,512			51,258,576	$	51,258	$	28,980,063	$	(27,041,809	)	$	1,989,512
Issuance of shares – warrants and options exercised		1,305,362		1,306		—			633,006			—			—			634,312
Share based compensation on stock options or RSUs		—		—		—			343,007			—			—			343,007

																				Common Stock Number of Shares		Amount		Additional Paid in Capital		Retained Deficit			Total
Beginning – January 1, 2023																					53,440,482	$	53,440	$	30,774,197	$	(38,083,304	)	$	(7,255,667	)
Issuance of shares – options exercised																					150,000	$	150		67,106		—			67,256
Issuance of shares - warrants exercised																					2,499,453	$	2,499		1,133,802		—			1,136,301
Issuance of shares - share based compensation on RSUs																					208,416	$	208		500,421		—			500,629
Loss for the period		—		—		—			—			—			(6,765,657	)		(6,765,657	)		—		—		—		(6,071,704	)		(6,071,704	)
Ending – June 30, 2022		52,563,938	$	52,564	$	—		$	29,956,076		$	—		$	(33,807,466	)	$	(3,798,826	)
Issuance of shares – warrants and options exercised		10,000		10		—			—			—			—			10
Share based compensation on stock options or RSUs		—		—		—			69,715			—			—			69,715
Income for the period		—		—		—			—			—			163,631			163,631
Ending – September 30, 2022		52,573,938	$	52,574	$	—		$	30,025,791		$	—		$	(33,643,835	)	$	(3,565,470	)
Ending – March 31, 2023																					56,298,351	$	56,297	$	32,475,526	$	(44,155,008	)	$	(11,623,185	)


	For The Nine Months Ended September 30,						For The Three Months Ended March 31,
	2022			2021			2023			2022
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss from continuing operations	$	(11,381,523	)	$	(15,513,594	)
Net loss							$	(6,071,704	)	$	(4,779,502	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation		296,830			15,484			443,139			23,312
Bad debt expense		94,893			—
Loss on warrant revaluation		—			2,650,772
Bad debt expense (recovery)								(17,540	)		—
Gain on sale of spare parts								(55,744	)		—
Amortization of debt issue costs		389,301			—			250,457			—
Amortization of operating lease right of use assets		3,381,624			817,900
Amortization of operating lease right of use asset								1,846,952			950,324
Share-based payments		795,334			565,888			500,630			382,612
Foreign exchange (gain) loss		3,753			(73,037	)		1,200			—
Loss on sale of property								135,772			—
Interest on finance leases								93,009			—
Changes in assets and liabilities
Accounts receivable		(803,231	)		(55,706	)		(1,254,889	)		275,953
Assets held for sale								255,848			—
Prepaid expenses and other current assets		(1,321,588	)		(377,087	)		(120,608	)		(839,677	)
Accounts payable		3,095,518			2,409,236			358,792			3,077,116
Accrued liabilities and other liabilities		6,248,347			1,324,177			4,803,034			729,211
Operating lease obligations		(2,559,147	)		(389,985	)		(2,017,874	)		(731,312	)
Net cash used in operating activities - continuing operations		(1,759,889	)		(8,625,952	)
Net cash provided by operating activities - discontinuing operations		—			177,706
Other liabilities								154,651			—
Net cash used in operating activities		(1,759,889	)		(8,448,246	)		(694,875	)		(911,963	)

CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of property and equipment		(1,124,712	)		(506,016	)		(306,618	)		(273,031	)
Deferred costs and other assets		(3,350,867	)		(1,394,700	)
Deposits, deferred costs and other assets								(823,971	)		(617,849	)
Net cash used in investing activities		(4,475,579	)		(1,900,716	)		(1,130,589	)		(890,880	)

CASH FLOWS FROM FINANCING ACTIVITIES
Payments to related party		(197,558	)		(196,792	)		—			(197,558	)
Principal repayments on finance leases		(321,140	)		—
Deferred finance fee		—			226,006
Other liabilities		—			31,221
Principal payments on finance leases								(111,373	)		—
Proceeds on issuance of shares		644,251			18,878,080			1,203,557			9,930
Common stock subscribed		—			(218,238	)
Notes payable		5,925,529			—
Net cash provided by financing activities – continuing operations		6,051,082			18,720,277
Net cash provided by financing activities – discontinued operations		—			(31,416	)
Proceeds from note payable								2,500,000			5,925,529
Net cash provided by financing activities		6,051,082			18,688,861			3,592,184			5,737,901

Net increase (decrease) in cash		(184,386	)		8,339,899
Net increase in cash								1,766,720			3,935,058

Cash, cash equivalents and restricted cash - beginning of the period		7,994,001			548,690			5,460,934			7,994,001
Cash, cash equivalents and restricted cash - end of the period	$	7,809,615		$	8,888,589		$	7,227,654		$	11,929,059

Non-cash transactions
Right-of-use (ROU) assets acquired through operating leases	$	5,390,848			—		$	16,209,011			—
Equipment acquired through finance leases		2,815,432			—			1,214,658			—
Warrants issued for debt (debt discount)		2,130,642			—

Cash paid for

Interest	$	285,684		$	27,306		$	291,258			—
Taxes	-			-			-			-

BASIS OF PRESENTATION AND GOING CONCERN

Global Crossing Airlines Group Inc. (the “Company” or “Global”) 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 US, Caribbean and Latin American markets

The condensed consolidated financial statements include the accounts of the Company, and its subsidiaries, Global Crossing Airlines, Inc. and Global Crossing Airlines, LLC (collectively “Global USA”), GlobalX A320 Aircraft Acquisitions Corp. (“Acquisition A320”), GlobalX A321 Aircraft Acquisition Corp. (“Acquisition A321”), GlobalX Travel Technologies, Inc. (“Technologies”), GlobalX Air Tours, LLC (“GlobalX Tours”), LatinX Air S.A.S., GlobalX Colombia S.A.S. and Capitol Airlines, LLC. 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~~years ended December 31, 2022 and 2021, which includes additional disclosures and a summary of our significant accounting policies. The December 31, ~~2021,~~2022, balance sheet data was derived from that Annual Report and may not include disclosures required for presentation in conformity with U.S. GAAP. In our opinion, these Financial Statements include all adjustments, consisting of normal recurring items, considered necessary by management to fairly state the Company’s results of operations, financial position, and cash flows

Our quarterly results are subject to seasonal and other fluctuations, including fluctuations resulting from the global COVID-19 pandemic 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 ~~September 30, 2022,~~March 31, 2023, the Company had a working capital deficit of $~~15,536,069~~19,453,377 and a retained deficit of $~~33,643,835~~44,155,008. 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 ~~financings~~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.

NEW ACCOUNTING STANDARDS

Recently Adopted Accounting Standards

~~In June 2016, the FASB issued ASU 2016-13,~~ ~~Financial Instruments - Credit Losses~~ ~~(Topic 326): Measurement of Credit Losses on Financial Instruments~~. The update requires the use of an “expected loss” model on certain types of financial instruments and requires consideration of a broader range of reasonable and supportable information to calculate credit loss estimates. For trade receivables, loans and held-to-maturity debt securities, entities will be required to estimate lifetime expected credit losses. For available-for-sale debt securities, entities will be required to recognize an allowance for credit losses rather than a reduction to the carrying value of the asset. ASU 2016-13 was initially effective for non- public companies for fiscal years and interim periods beginning after December 15, 2021, with early adoption permitted. In November 2019, the FASB issued ASU 2019-10, ~~Financial Instruments-Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842): Effective Dates~~, which delayed the effective date for certain entities, such as the Company, to apply ASU 2016-13 until fiscal years and interim periods beginning after December 15, 2022. The Company evaluated the impact of ASU 2016-13 and determined the adoption of Topic 326 will not have a material impact on our consolidated financial statements.

In May 2021, the Financial Accounting Standards Board (“FASB”) issued accounting standards update (“ASU”) 2021-04—Earnings Per Share (Topic 260), Debt— Modifications and Extinguishments (Subtopic 470-50), Compensation—Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options, to clarify and reduce diversity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options (for example, warrants) that remain equity classified after modification or exchange. The amendments in this ASU are effective for public and nonpublic entities for fiscal years beginning after December 15, 2021, and interim periods with fiscal years beginning after December 15, 2021. Early adoption was permitted, including adoption in an interim period. The adoption of this pronouncement had no impact on our accompanying consolidated financial statements.

Recently Issued Accounting Standards

In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The update requires the use of an “expected loss” model on certain types of financial instruments and requires consideration of a broader range of reasonable and supportable information to calculate credit loss estimates. For trade receivables, loans and held-to-maturity debt securities, entities will be required to estimate lifetime expected credit losses. For available-for-sale debt securities, entities will be required to recognize an allowance for credit losses rather than a reduction to the carrying value of the asset. ASU 2016-13 was initially effective for non- public companies for fiscal years and interim periods beginning after December 15, 2021, with early adoption permitted. In November 2019, the FASB issued ASU 2019-10, Financial Instruments-Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842): Effective Dates, which delayed the effective date for certain entities, such as the Company, to apply ASU 2016-13 until fiscal years and interim periods beginning after December 15, 2022. The Company evaluated the impact of ASU 2016-13 and determined the adoption of Topic 326 will not have a material impact on our consolidated financial statements.

EQUITY METHOD INVESTMENTS

Investments in partnerships and less-than-majority owned subsidiaries in which the Company does not have control but has the ability to exercise significant influence over operating and financial policies, are accounted for using the equity method of accounting. The equity method investments are included in the accompanying Balance Sheets with Deferred Costs and Other Assets. The Company’s share of earnings or losses from these investments is shown in the accompanying Consolidated Statements of Operations in Other Expense. Equity method investments are initially recognized at cost. The carrying amount of the equity investment is adjusted at each reporting period by the percentage of any change in its equity corresponding to the Company’s percentage interest in these equity affiliates. The carrying costs of these investments are also increased or decreased to reflect additional contributions or withdrawals of capital. Any difference in the book equity and the Company’s pro-rata share of the net assets of the investment will be reported as gain or loss at the time of the liquidation of the investment. It is the Company’s policy to record losses in excess of the investment if the Company is committed to provide financial support to the investee.

The Company’s investments in affiliates accounted for using the equity method include a 50% interest in GlobalX Ground Team, LLC (“GlobalX Ground”) and aapproximately 2513% ownership interest in Canada Jetlines Operations Ltd. (“Jetlines”). as of March 31, 2023.

Investment in GlobalX Ground Team, LLC:

On September 9, 2020, the Company entered into a joint venture agreement with KD Holdings, LLC (“KD Holdings”) for the purpose of providing ground handling services. Under the terms of the agreement, KD Holdings will run the day-to-day operations of the ground handling division and supply the ground equipment and Global will provide assistance and guidance to the operations. The Company accounts for the joint venture in accordance with the equity method.

As of December 31, 2021, the Company elected to write down GlobalX’s investment in the joint venture to zero. Going forward GlobalX has elected to self-perform all ground handling activities at Miami International Airport. As of ~~September 30, 2022~~March 31, 2023 and December 31, ~~2021,~~2022, there was $~~28,681~~0 due to GlobalX Ground and $0 and $~~197,558~~28,681, loss recorded during the three months period ended March 31, 2023 and the year ended on December 31, 2022, respectively, ~~due~~with respect to the equity investment in GlobalX Ground.

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 Global shareholders. Global retained 25% of the shares issued and outstanding of Jetlines and accounts for the investment in accordance with the equity method. ~~During~~As of March 31, 2023, the ~~three and nine months ended September 30, 2022~~Company holds approximately 13% ownership in Jetlines. Jetlines did not generate ~~revenue.~~net income during the year ended on December 31, 2022 and the three months period ended on March 31, 2023 .

~~DEBENTURES~~DEBT

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 will be used to further the business objectives of the Company and to secure additional aircraft for charter operations. As of March 31, 2023, 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.

On March 17, 2022, the Company entered into agreements (each a “Subscription Agreement”) pursuant to which the Company sold ~~US$~~$6.0 million of its securities (the “Financing”). The securities sold in the Financing consisted of (1) non-convertible debentures (each,

a “Debenture”) and (2) one common stock purchase warrant (each, a “Warrant”) for every US$1.24 of principal of the Debentures purchased for gross proceeds of up to US $6.0 million. Each Warrant is exercisable into one share of common stock (each, a “Warrant Share”) at an exercise price of US$1.24 per Warrant Share with an exercise period of 24 months from the date of closing.

The terms of the Debentures include:

•

a maturity date of 24 months from the date of issuance (the “Maturity Date”) and the principal amount of the Debentures, together with any accrued and unpaid interest, will be payable on the Maturity Date;

•

the Debentures bear interest (the “Interest”) at the rate of 15% per annum, which Interest will be payable in cash quarterly in arrears;

•

the Company has the option to prepay the principal amount of the Debentures on 30 business days’ notice, provided that if repaid in the first year, the Company must provide a payment such that the holders of the Debentures receive at least 10% premium on the principal amount, after deducting any prior Interest payments from such premium; and

•

it is intended that repayment by the Company of amounts owing under the Debentures will be secured by a secured lien on the tangible fixed assets of the Company

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 $2.2 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 Black-Scholes option pricing model to value the warrants at issuance. The inputs selected are: underlying stock price at date of issuance of $1.04 per share, exercise price of $1.24 per share, expected term of 2 years, dividends of $0, a risk free rate of -0.6%, and volatility of 143%.

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.

SHARE CAPITAL AND ADDITIONAL PAID IN CAPITAL AUTHORIZED

On July 12, 2021, the Company completed a share capital reorganization creating a new class of shares, Class B Non-Voting Common Stock. As of ~~September 30,~~March 31, 2023 and December 31, 2022, ~~and 2021,~~ the Company had ~~31,660,576~~37,334,659 and ~~24,978,768~~32,668,320 common shares, 5,537,313 and 5,537,313 Class A Non-Voting Common Shares, and ~~15,376,049~~13,426,379 and ~~19,946,686~~15,234,849 Class B Non-Voting Shares outstanding, respectively.

WARRANTS

Following is a summary of the warrant activity during the three months ended ~~September 30, 2022~~March 31, 2023 and ~~2021:~~2022:

Number of
Share
Purchase
Warrants

Weighted
Average
Exercise Price

Outstanding, January 1, 2021

7,507,005

0.49

Issued

8,414,517

0.99

Exercised

(1,050,740
)

0.49

Expired

-

Outstanding March 31, 2021

14,870,782

0.76

Issued

7,726,482

1.47

Exercised

(4,424,138
)

0.49

Expired

-

Outstanding June 30, 2021

18,173,126

1.03

Issued

-

-

Exercised

-

-

Expired

-

Outstanding September 30, 2021

18,173,126

1.03

Outstanding, January 1, 2022

17,631,350

1.05

Issued

4,838,707

1.24

Exercised

(20,700
)

0.49

Expired

-

Outstanding, March 31, 2022

22,449,357

1.09

Issued

-

-

Exercised

(1,078,470
)

0.48

Expired

(40,261
)

0.48

Outstanding, June 30, 2022

21,330,626

1.32

Issued

-

-

Exercised

-

-

Expired

(1,685,375
)

0.48

Outstanding, September 30, 2022

19,645,251

1.27


	Number of Share Purchase Warrants			Weighted Average Exercise Price
Outstanding, January 1, 2022		17,631,350		$	1.05
Issued		4,838,707			1.24
Exercised		(20,700	)		0.49
Expired		-			-
Outstanding, March 31, 2022		22,449,357			1.09

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

As of ~~September 30, 2021,~~March 31, 2022, the following common stock share purchase warrants were outstanding and exercisable:

Outstanding

Exercise Price

Remaining life
(years)

Expiry Date

3,338,806

USD$0.48

0.93

September 3, 2022

4,910,614

USD$1.00

1.57

April 26, 2023

203,840

USD$0.62

1.57

April 26, 2023

2,182,553

USD$0.39

1.59

May 04, 2023

7,537,313

USD$1.50

4.58

April 29, 2026

18,173,126


Outstanding		Exercise Price	Remaining life (years)	Expiry Date
	2,804,106	USD$0.48	0.23	April 23, 2022
	4,882,838	USD$1.00	1.07	April 26, 2023
	203,840	USD$0.62	1.07	April 26, 2023
	2,182,553	USD$0.39	1.09	May 4, 2023
	4,838,707	USD$1.24	1.99	March 28, 2024
	7,537,313	USD$1.50	4.08	April 29, 2026
	22,449,357

As of ~~September 30, 2022,~~March 31, 2023, the following common stock share purchase warrants were outstanding and exercisable:

Outstanding

Exercise Price

Remaining life
(years)

Expiry Date

203,840

USD$0.62

0.57

April 26, 2023

4,882,838

USD$1.00

0.57

April 26, 2023

2,182,553

USD$0.39

0.59

May 4, 2023

4,838,707

USD$1.24

1.49

March 28, 2024

7,537,313

USD$1.50

3.58

April 29, 2026

19,645,251


Outstanding		Exercise Price	Remaining life (years)	Expiry Date
	4,649,238	USD$1.00	0.07	April 26, 2023
	109,200	USD$0.62	0.07	April 26, 2023
	4,838,707	USD$1.24	0.99	March 28, 2024
	7,537,313	USD$1.50	3.08	April 29, 2026
	17,134,458

SHARE-BASED PAYMENTS

The maximum number of shares of common stock ("Voting ~~Shares~~Shares") issuable pursuant to share-based payment arrangements, including stock options, restricted share units and performance share units, is ~~5,460,000~~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 months ended ~~September 30, 2022~~March 31, 2023 and ~~2021:~~2022:


	Number of stock options			Weighted average exercise price		Weighted average grant date fair value
Outstanding, January 1, 2021		1,387,000		$	0.25	$	0.21
Granted		—			—		—
Exercised		—			—		—
Forfeited		—			—		—
Outstanding March 31, 2021		1,387,000			0.25		0.21
Granted		—			—		—
Exercised		—			—		—
Forfeited		—			—		—
Outstanding June 30, 2021		1,387,000			0.25		0.21
Granted		—			—		—
Exercised		(407,999	)		0.25		0.16
Forfeited		(25,000	)		0.25		0.16
Outstanding September 30, 2021		954,001			0.25		0.49
								Number of stock options			Weighted average exercise price		Weighted average grant date fair value
Outstanding January 1, 2022		920,668			0.25		0.49		920,668		$	0.25	$	0.49
Granted		—			—		—		—			—		—
Exercised		—			—		—		—			—		—
Forfeited		(16,667	)		0.25		0.57		(16,667	)		0.25		0.57
Outstanding, March 31, 2022		904,001		0.25		0.48			904,001		0.25		0.48

Outstanding January 1, 2023									820,668		$	0.25	$	0.34
Granted		—			—		—		—			—		—
Exercised		(33,333	)		0.25		0.57		(150,000	)		0.48		0.16
Forfeited		—			—		—		(200,000	)		0.25		0.57
Outstanding, June 30, 2022		870,668		0.25		0.48
Granted		—			—		—
Exercised		—			—		—
Forfeited		—			—		—
Outstanding, September 30, 2022		870,668		0.25		0.48
Outstanding, March 31, 2023									470,668		0.25			0.54

As of ~~September 30,~~March 31, 2022, the following stock options were outstanding and exercisable:

Outstanding

Exercisable

Exercise Price

Remaining life (years)

Expiry Date

150,000

150,000

0.47

0.75

June 29, 2023

670,668

670,668

0.25

2.73

June 23, 2025

50,000

33,333

0.62

2.98

September 23, 2025

870,668

854,001


Outstanding		Exercisable		Exercise Price		Remaining life (years)		Expiry Date
	150,000		150,000	$	0.47		1.25	June 29, 2023
	704,001		333,331	$	0.25		3.23	June 23, 2025
	50,000		33,333	$	0.62		3.48	September 23, 2025
	904,001		516,664

As of ~~September 30, 2021,~~March 31, 2023, the following stock options were outstanding and exercisable:

Outstanding

Exercisable

Exercise Price

Remaining life (years)

Expiry Date

150,000

75,000

0.47

1.75

June 29, 2023

754,001

412,328

0.25

3.73

June 23, 2025

50,000

16,666

0.62

3.98

September 23, 2025

954,001

503,994


Outstanding		Exercisable		Exercise Price		Remaining life (years)		Expiry Date
	420,668		420,668		0.25		2.23	June 23, 2025
	50,000		50,000		0.62		2.48	September 23, 2025
	470,668		470,668

The Company recognizes share-based payments expense for all stock options granted based on the grant date fair value with the expense recognized ratably over the service period. 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 nine~~ months ended ~~September 30, 2022~~March 31, 2023 and ~~the year ended December 31, 2021.~~2022.

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 ~~TSXV~~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 ~~counterparty~~counterpart asks for cash settlement.

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:

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.

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.

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 nine~~ months ended ~~September 30, 2022~~March 31, 2023 and ~~2021:~~2022:

109


	Number of RSUs			Weighted average grant date fair value per RSU
Outstanding, January 1, 2021		685,000			0.67
Granted		352,500			1.48
Issuance of common stock		(40,000	)		0.69
Forfeited		(10,000	)		1.48
Outstanding March 31, 2021		987,500			0.67
Granted		790,000			1.99
Issuance of common stock		—			—
Forfeited		—			—
Outstanding June 30, 2021		1,777,500			1.41
Granted		—			—
Issuance of common stock		—			—
Forfeited		(100,000	)		0.79
Outstanding September 30, 2021		1,677,500			1.45
						Number of RSUs			Weighted average grant date fair value per RSU
Outstanding, January 1, 2022		2,067,500		$	1.16		2,067,500		$	1.16
Granted		620,000			1.37		620,000			1.37
Issuance of common stock		—			—		—			—
Forfeited		(400,000	)		1.48		(400,000	)		1.48
Outstanding March 31, 2022		2,287,500			1.02		2,287,500			1.02

Outstanding, January 1, 2023							3,305,837		$	1.14
Granted		—			—		1,687,777			0.97
Issuance of common stock		—			—		(400,542	)		1.04
Forfeited		(115,000	)		1.79		(129,315	)		0.96
Outstanding June 30, 2022		2,172,500			1.47
Granted		1,570,000			0.63
Issuance of common stock		(10,000	)		0.69
Forfeited		(310,000	)		0.75
Outstanding September 30, 2022		3,422,500			1.16
Outstanding March 31, 2023							4,463,757			1.10

During the three ~~and nine~~ months ended ~~September 30,~~March 31, 2023 and 2022, the Company recognized share-based payments expense with respect to stock options and RSUs of $~~69,724~~500,630 and $~~795,334~~382,612, respectively. ~~During the three and nine months ended September 30,2021, the Company recognized share-based payments expense with respect to stock options and RSUs of $280,903~~ ~~and $565,888, respectively.~~

The remaining compensation that has not been recognized as of ~~September 30, 2022~~March 31, 2023 with regards to RSUs and the weighted average period they will be recognized are $~~1,615,975~~3,286,018 and ~~1.71~~2.12 years. ~~As of September 30, 2022, all compensation expense with respect to stock options has been recognized.~~

INCOME TAXES

The Company’s expected effective tax rate for the three months ended ~~September 30,~~March 31, 2023, and 2022 ~~and 2021~~ was 0%. The effective tax rate varies from the statutory rate due to the change in the valuation allowance.

COMMITMENTS AND CONTINGENCIES

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

On February ~~18, 2022,~~24, 2023, the Company entered into a lease agreement for an ~~aircraft.~~aircraft and paid commitment fees to the lessor. The lease will commence upon aircraft delivery which is expected to be on July 2023 and will run through ~~four year~~74 months ~~lease term commenced on~~ ~~June 15, 2022. Under the agreement,~~from delivery date. In addition to basic rent due, the Company will pay the lessor ~~a fixed hourly rent for each flight hour operated during the first~~ ~~12 months~~ ~~and a fixed monthly rent for the remaining~~ ~~36 months, plus~~ supplemental rent for maintenance of ~~the aircraft.~~

~~The Company amended one of its existing passengers~~ aircraft ~~lease agreements to extend from a~~ equipment.~~24 months~~ ~~lease term ending on~~ ~~April 13, 2023~~ ~~to end on~~ ~~November 15, 2023. In addition to this amendment, the Company entered into a definitive agreement to convert the aircraft and lease for a period of~~ 8 ~~years. The lease term is expected to commence after a 12 months conversion period and the Company will pay the lessor a fixed rent for month plus supplemental rent for maintenance of the aircraft.~~

During the three months ended ~~on September 30, 2022,~~March 31, 2023, the Company entered into ~~various~~five finance lease agreements for 18equipment ~~in use by~~to support the Company's technical operations. Payments under these finance lease agreements are fixed for terms of 5 ~~and~~ 7 years.

Some of our finance leases include optional renewal periods. Generally, we do not consider any additional renewal periods to be reasonably certain of being exercised, as the initial lease term of the related lease is for all or most of the useful life of the equipment and thus renewal periods are not included in the lease term, nor any related payments are reflected in the finance lease assets and finance lease liabilities.

The following table provides details of the Company's future minimum lease payments under finance lease liabilities and operating lease liabilities recorded on the Company's condensed consolidated balance sheets as of ~~September 30, 2022.~~March 31, 2023. 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 2022
$
145,654

$
2,100,000

2023

582,617

8,376,250

2024

582,617

6,712,500

2025

582,617

6,670,000

2026

582,617

5,632,100

2027 and thereafer

912,247

3,188,164

Total minimum lease payments

3,388,369

32,679,014

Less amount representing interest

922,515

6,411,474

Present value of minimum lease payments

2,465,854

26,267,540

Less current portion

317,423

6,165,322

Long-term portion

2,148,431

20,102,218


	Finance Leases		Operating Leases
Remainder of 2023	$	646,162	$	10,111,250
2024		861,549		10,937,500
2025		861,549		10,835,000
2026		861,549		9,702,100
2027		724,648		6,890,000
2028 and thereafer		1,013,641		14,625,058
Total minimum lease payments		4,969,098		63,100,908
Less amount representing interest		1,403,824		19,069,639
Present value of minimum lease payments		3,565,274		44,031,269
Less current portion		461,867		7,271,902
Long-term portion		3,103,407		36,759,367

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

Three Months Ended September 30,

Nine Months Ended September 30,

2022

2021

2022

2021

Finance lease cost

Amortization of leased assets

$
45,931

$
-

$
45,931

$
-

Interest of lease liabilities

30,405

—

30,405

—

Operating lease cost

Operating lease cost (1)

2,181,983

310,620

5,396,050

876,482

Total lease cost

2,258,319

310,620

5,472,386

876,482


	Three Months Ended March 31,
	2023		2022
Finance lease cost
Amortization of leased assets	$	114,009	$	-
Interest of lease liabilities		93,009		—
Operating lease cost
Operating lease cost (1)		3,216,770		1,817,845
Total lease cost		3,423,788		1,817,845

(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:


	September 30, 2022			September 30, 2021			March 31, 2023			March 31, 2022
Weighted-average remaining lease term
Operating leases	4.4 years			4.06 years			6.30 years			5.50 years
Finance leases	5.97 years				—		5.95 years				—
Weighted-average discount rate
Operating leases		10.65	%		10.21	%		11.63	%		10.07	%
Finance leases		11.67	%		—			12.14	%		—

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


		Nine Months Ended September 30,					Three Months Ended March 31,
		2022		2021			2023		2022
Cash paid for amounts included in the measurement of lease liabilities:	Cash paid for amounts included in the measurement of lease liabilities:					Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases		$	2,559,147	$	-		$	2,017,874	$	-
Financing cash flows from finance leases			321,140		—			111,373		—

~~On August 22,~~ ~~2022, the Company entered into a premium finance agreement with a financial institution to finance a~~ ~~12-month~~ ~~hull insurance policy for its aircrafts. The Company financed $187,196~~ ~~of the total premium amount of $219,713~~ ~~at a rate of~~ ~~5.05% interest. The down payment of $33,169~~ ~~and the first monthly installment was paid at time of signing.~~

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.

LOSS PER SHARE

Basic earnings per share, which excludes dilution, is computed by dividing ~~Net Income~~net income or loss attributable 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 ~~and nine~~ months ended ~~September 30, 2022~~March 31, 2023 and ~~2021:~~2022:

Nine Months Ended
September 31, 2022

Nine Months Ended
September 31, 2021

Numerator:

Net loss

$
(11,381,523
)

$
(15,335,888
)
Denominator:

Weighted average common shares outstanding - Basic

51,776,833

43,572,925

Dilutive effect of stock options, RSUs and warrants

—

—

Weighted average common shares outstanding - Diluted

51,776,833

43,572,925

Basic loss per share

$
(0.22
)

$
(0.35
)
Diluted loss per share

$
(0.22
)

$
(0.35
)


	Three Months Ended September 30, 2022		Three Months Ended September 30, 2021			Three Months Ended March 31, 2023			Three Months Ended March 31, 2022
Numerator:
Net income (loss)	$	163,631	$	(5,263,420	)	$	(6,071,704	)	$	(4,779,502	)
Denominator:
Weighted average common shares outstanding - Basic		52,569,481		50,431,295			54,490,925			51,241,326
Dilutive effect of stock options, RSUs and warrants		23,938,419		—
Dilutive effect of stock options and warrants							—			—

Weighted average common shares outstanding - Diluted		76,507,900		50,431,295			54,490,925			51,241,326

Basic loss per share	$	0.00	$	(0.10	)	$	(0.11	)	$	(0.09	)
Diluted loss per share	$	0.00	$	(0.10	)	$	(0.11	)	$	(0.09	)

There were ~~19,645,521~~17,134,458 warrants, ~~870,668~~470,668 options, and ~~3,422,500~~4,463,757 RSUs outstanding at ~~September 30, 2022~~March 31, 2023 and ~~18,173,126~~22,449,357 warrants, ~~954,001~~904,001 options and ~~1,677,500~~2,287,500 RSUs outstanding at ~~September 30, 2021~~March 31, 2022 that were excluded from the calculation of diluted EPS. The

Company excluded the warrants, options and RSUs from the calculation of diluted EPS for the ~~nine~~three months ended ~~September 30,~~March 31, 2023 and 2022, ~~and for the three and nine months ended September 30, 2021,~~ as inclusion would have an anti-dilutive effect.

11.

RELATED PARTY TRANSACTIONS

On May 19, 2021, the Company entered into an arrangement agreement to complete a spin-out of the shares of its wholly owned subsidiary, Canada Jetlines Operations Ltd. (“Jetlines”). 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 Global shareholders. Global retained 25% of the shares issued and outstanding of Jetlines and accounts for the investment in accordance with the equity method. As of March 31, 2023, Global Crossing Airlines hold approximately 13% of the outstanding at March 31, 2023. Currently, Global continues to provide back-office support including sharing the costs of the Company’s aircraft fleet management software (TRAX).

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 of ~~September 30,~~March 31, 2023 and December 31, 2022, amounts due to related parties include the following:

~~GlobalX Ground~~Global earned and was owed $~~28,681~~125,490 and $110,177, respectively, in relation to ~~ground~~shared TRAX services ~~provided at Miami-Dade Airport.~~with Canada Jetlines LLC.

Other Related Party Transactions and Balances

The amounts due to related parties are unsecured, non-interest bearing and have no stated terms of repayment.

Smartlynx Airlines Malta Limited is an entity ~~whose Chief Executive Officer is a Board Member~~who holds approximately 4% of ~~Global. During the year ending December 31, 2020, Global~~issued and outstanding shares. The Company made advanced payments totaling $~~500,000~~250,000 to ~~Smartlynx. $350,000~~ ~~of those payments related to~~ ~~two~~ ~~security deposits. One is a $250,000~~Smartlynx as security deposit for one passenger aircraft ~~to deliver 200 hours of ACMI services per month~~ and ~~the second~~it is ~~a $100,000~~ ~~security deposit for a long long-term lease of an A321F aircraft. Total~~included in deposits and ~~prepaid expense related to Smartlynx totaled $500,000~~ ~~as of September 30, 2022 and December 31, 2021, are included in~~ other assets on the consolidated balance ~~sheets.~~

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

The following discussion should be read together with the accompanying unaudited condensed consolidated financial statements and related notes in this report and the audited financial statements included in the Company’s Annual Report for December 31, ~~2021~~2022 on Form 10-K. 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. Factors which could cause actual results to differ materially are discussed throughout this report and include, but are not limited to, those set forth at the end of this Item 2 under the heading "Cautionary Statement Regarding Forward Looking Statements." Additional factors are under the heading “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2021.~~2022.

Global Crossing Airlines Group Inc. (“GlobalX” or the “Company”) operates a US Part 121 domestic flag and ~~charter~~supplemental airline using the Airbus A320 family of 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~~Full Service ("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. GlobalX ~~also plans to operate~~began operating the Airbus A321 freighter (“A321F”) ~~commencing in~~during the ~~fourth~~first quarter of ~~2022~~2023 after completing all FAA certification requirements with the A321F.

Focused on becoming a market leader with differentiated, value-creating solutions

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/our operators to provide aircraft during their peak seasons; and provide ad-hoc and track charter programs for non-airline customers, including hotels, casinos, cruise ship companies, tour operators.

GlobalX ~~plans to add~~added the A321F (passenger to freighter) aircraft to its operating certificate and into the fleet commencing ~~Q4 2022,~~Q1 2023, and expects cargo ~~will~~to be an integral part of the GlobalX business. GlobalX ~~intends to operate~~operates its A321Fs under ACMI charter operations with major package operators and major freight and logistics companies. Under these types of arrangements, customarily, these operators will take the commercial risk associated with the selling of the cargo and provide all ground handling and cargo-specific operations, with GlobalX assuming the operational risk of providing a functional aircraft, trained crew, in a safe and on time manner as the ACMI operator.

GlobalX ~~operates~~will initially operate from ~~four~~one primary geographic ~~bases:~~base:

GlobalX plans to achieve its revenue goals by flying charter operations for a variety of client groups:

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.

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.

Heavy maintenance checks are expected to be sourced out 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.

We expect the existing charter operators based in the U.S. to respond to GlobalX’s entry into the market by lowering their pricing to customers. The expected competitive response typically includes lowered ACMI rates for key contracts. We believe GlobalX’s existing relationships with potential customers and the underserved demand in the U.S., coupled with our newer planes allowing for a more cost-efficient operation, will allow us to address any competitive pressure and grow as anticipated.

GlobalX is a charter provider that currently focuses exclusively on providing customized, non-scheduled passenger air transport services with narrow-body Airbus A320 and A321 aircraft. We expect our primary line of business and focus to be commercial charter services from MIA to destinations throughout North and South America and the Caribbean, with established scheduled airlines that need additional air lift to supplement their own, and established tour and travel operators that sell tour packages in and between these markets.

We provide our services through two contract structures: (1) ACMI and (2) ~~Charter~~Charter.

We believe operating charter flights will largely insulate our expected profitability from fluctuations in jet fuel prices, which are typically the largest and most volatile expense for an air carrier. Under the vast majority of our commercial passenger charter arrangements, our customers bear 100% of the cost of jet fuel. In addition, consistent with industry practice, we plan for those customers to pay us our contract price approximately two weeks in advance of their flights.

Because ~~we expect that~~ our ACMI customers ~~would be~~are responsible for fuel costs, our expected commercial ACMI revenues would not be affected directly by fuel price changes. However, a significant increase in fuel prices would likely have an adverse effect on demand for the use of our aircraft, which could have a material adverse effect on our profitability and financial position.

Our management team has extensive operating and leadership experience in the airfreight, airline, and aircraft leasing, maintenance, and management industries at companies such as Republic Airways, Eastern Airlines, JetBlue Airways, Virgin America, Hawaiian Airlines, American Airlines, US Airways, Atlas Air, Breeze Airways, Emirates, North American Airlines, Miami Air, AAR, Continental Airlines, Pan Am, Atlantic Coast Airlines, and Flair Airlines, as well as the United States Army, and Air Force. In addition, our management team has a diversity of experience from other industries at companies such as KBR, Teladoc, The Home Depot, Halliburton, Lehman Brothers, and the Burger King Corporation.

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

In launching a US 121 Domestic Flag and Supplemental charter airline in the United States, GlobalX has done ~~or plans to do,~~ the following:

GlobalX operates its A320 family aircraft under ACMI/Full Contract charter operations for major airlines, tour operators, college and professional sports teams, incentive groups, major resorts and casino groups.

GlobalX plans to add A321F (passenger to freighter) aircraft to its operating certificate and into the fleet commencing Q4 2022. Cargo is an important revenue stream for airlines and will be an integral part of the GlobalX operation.

GlobalX intends to operate its A321Fs under ACMI/Wet Lease charter operations with major package operators and major freight and logistics companies. Under these arrangements, customarily, these operators will take the commercial risk associated with the selling of the cargo capacity and provide all ground handling and cargo-specific operations, with GlobalX assuming the operational risk of providing a functional aircraft, trained crew, in a safe and on time manner as the ACMI operator.

Our results for the ~~nine~~three months ended ~~September 30, 2022,~~March 31, 2023, were impacted by the following:

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

Three months ended March 31, 2023 and ~~nine months ended September 30,~~ 2022 ~~and 2021~~

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

Block Hours for the three months ended ~~September 30, 2022~~March 31, 2023 increased by ~~2,015~~1,405 or 81% compared with the same period in ~~2021,~~2022. The increase in block hours were driven by the availability of additional aircraft as the fleet grew from six to nine aircraft, a ~~direct result~~50% increase, the availability of ~~the~~additional pilots as our number of pilots grew from 51 to 85, a 66% increase driving higher utilization of ~~operating fleet from two to seven aircrafts.~~our available aircraft.

Block Hours for the nine months ended September 30, 2022 increased by 5,874 compared with the same period in 2021, as a direct result of the increase of operating fleet from two aircrafts for two months in 2021 to seven aircrafts in September 2022.

Operating revenue for the three months ended ~~September 30, 2022~~March 31, 2023 increased by ~~$27.7~~$15.8 million or 96.3%, compared with the same period in ~~2021, as a direct result~~2022. A number of factors drove the increase ofincluding the increase in the operating fleet from ~~two~~six to ~~seven aircrafts.~~

~~Operating revenue for~~eight passenger aircraft and the ~~nine months ended September 30, 2022~~addition of one cargo aircraft during the first quarter of 2023, increased utilization of existing aircraft partially driven by ~~$61.5 million~~the increased portion of Charter flying which included fuel and contracted ground services expenses. Charter block hours flown were up 116% and ACMI block hours flown were up 45% compared with the same period in ~~2021, as~~2022 contributing to a ~~direct result~~proportion of the percentage increase in revenue. These factors drove an increase in revenue per block hour of ~~operating fleet from two aircrafts for two months~~approximately 26% and on the basis of 88% in ~~2021~~the volume of hours flown when compared to ~~seven aircrafts~~the same period in ~~September~~ 2022.


	Three Months Ended September 30,									Three Months Ended March 31,
Operating Expenses	2022		2021		Inc/(Dec)		% Change			2023		2022		Inc/(Dec)		% Change
Salaries, Wages, & Benefits		7,712,688		2,558,017	$	5,154,671		201.5	%	$	11,167,593	$	5,865,074	$	5,302,519		90.4	%
Aircraft Fuel		7,764,761		834,313		6,930,448		830.7	%		7,948,962		3,250,554		4,698,408		144.5	%
Maintenance, materials and repairs		1,218,221		232,400		985,821		424.2	%		1,558,724		1,190,823		367,901		30.9	%
Depreciation and amortization		193,620		7,100		186,520		2627.0	%		443,139		23,312		419,827		1800.9	%
Contracted ground and aviation services		4,631,741		623,637		4,008,104		642.7	%		4,852,811		2,955,576		1,897,235		64.2	%
Travel		1,078,854		327,997		750,857		228.9	%		2,253,833		1,295,110		958,723		74.0	%
Insurance		947,342		481,678		465,664		96.7	%		948,781		857,268		91,513		10.7	%
Aircraft Rent		3,957,508		1,083,260		2,874,248		265.3	%		5,644,028		3,359,674		2,284,354		68.0	%
Other		2,489,530		2,232,978		256,552		11.5	%		2,862,672		2,345,908		516,764		22.0	%
Total Operating Expenses	$	29,994,265	$	8,381,380	$	21,612,885		257.9	%	$	37,680,543	$	21,143,299	$	16,537,244		78.2	%

	Nine Months Ended September 30,
Operating Expenses	2022		2021		Inc/(Dec)		% Change
Salaries, Wages, & Benefits		20,829,632		5,048,218	$	15,781,414		312.6	%
Aircraft Fuel		15,402,450		998,331		14,404,119		1442.8	%
Maintenance, materials and repairs		3,373,396		454,635		2,918,761		642.0	%
Depreciation and amortization		296,830		15,484		281,346		1817.0	%
Contracted ground and aviation services		10,674,340		806,033		9,868,307		1224.3	%
Travel		3,204,172		391,320		2,812,852		718.8	%
Insurance		2,713,791		1,424,400		1,289,391		90.5	%
Aircraft Rent		11,151,412		1,914,041		9,237,371		482.6	%
Other		7,464,756		5,000,740		2,464,016		49.3	%
Total Operating Expenses	$	75,110,779	$	16,053,202	$	59,057,577		367.9	%

Total operating expenses for the three months ended ~~September 30, 2022~~March 31, 2023 increased by ~~$21.7~~$16.5 million, or ~~260.9%~~78.2% compared with the same period in ~~2021,~~2022, as a direct result of the increase ofin the operating fleet from ~~two~~six to ~~seven aircrafts and~~nine aircraft, resources ~~required~~ to operate those ~~aircrafts.~~ aircraft and fuel and contracted ground services required to fly Charters.

The increase in salaries, wages, and benefits of $5.3 or 90.4% million is primarily due to the hiring and training of pilots and other airline personnel.

The increase in aircraft fuel of $4.7 million or 144.5% was mainly due to an increase of 76% in the volume of Charter block hours flown and ~~rent was primarily driven by~~an increase of 36% in the ~~addition of aircrafts to our existing fleet as well as increased block hours.~~fuel average price.

~~Total operating expenses for the nine months ended September 30, 2022~~Aircraft rent increased by ~~$59.3~~$2.3 million or 375.7% compared with the same period in 2021, as a direct result of the increase of operating fleet from two to seven aircrafts and resources required to operate those aircrafts. The increase in salaries, wages and benefits is primarily68% due to ~~the hiring and training of pilots and other airline personnel. The~~

increase in aircraft fuel and rent was primarily driven by the addition of aircrafts to our existing fleet as well as increased block hours. The increase in maintenance, materials and repairs was driven by the increase in the number of ~~aircrafts operated during the period. Depreciation~~aircraft from six aircraft in Q1 2022 to nine aircraft in Q1 2023.

The increase in contracted ground and ~~amortization also increased significantly as a result of~~aviation services was primarily driven by the increase ~~assets acquired to support our FAA certification and increase~~of 76% in ~~number of aircrafts operated.~~Charter hours.

Depreciation and amortization increased by $419.8 thousand or 1,800% primarily driven by excess scrapping of rotable parts.

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

Non-operating expense ~~(income)~~ for the three months ended ~~September 30, 2022~~March 31, 2023 increased by ~~$688.3~~$525.5 thousand, or ~~1,230%~~3,241% compared with the same period in ~~2021,~~2022, primarily driven by interest expense on the debentures issued during March 2022 and the working capital loan of $2.5 million (up to $5 million) entered in ~~connection with the Financing project on March 17, 2022.~~

Non-operating expenses (income) for the nine months ended December 31, 2022 decreased by $1.8 million, or 67% compared with the same period in 2021, primarily driven by reclassification of warrants during 2021 from a liability to equity as well as an increase in net interest expense due to the debentures issued in 2022. Our expected effective income tax rate was a benefit rate of 0%.January 2023.

The most significant liquidity events for the ~~nine~~three months ended ~~September 30,~~March 31, 2023 and 2022 ~~and 2021~~ were as follows:

Operating Activities. For the ~~nine~~three months ended ~~September 30, 2022, net~~March 31, 2023, Net cash used by operating activities ~~decreased~~increased by ~~$ 6.3~~$0.7 million to $2$1.8 million, which primarily reflected Net loss of ~~$11.4~~$6.1 million, increase in accounts receivable of ~~803.2 thousand,~~1.3 million, increase in prepaid, deposits and other assets of ~~$1.3~~$0.9 million, decrease in operating lease obligations of ~~$2.3~~$1.8 million, partially offset by an increase in accounts payable of ~~$3.1 million,~~$359 thousand, and an increase in accrued liabilities and other liabilities of ~~$5.9~~$4.8 million. The Net ~~Loss~~loss was also offset by noncash adjustments of ~~$296.8~~$443.1 thousand for depreciation expense, ~~$795.3~~$500.6 thousand for share-based payments, ~~$3.4~~$1.8 million for amortization of right-of-use assets and ~~$389.3~~$250.4 thousand for amortization of debt issuance costs. For the ~~nine~~three months ended ~~September 30, 2021, Net~~March 31, 2022, net cash used ~~for~~by operating activities was ~~$8.4 million,~~$912.0 thousand, which primarily reflected ~~the lack~~net loss of $4.8 million, an ~~airline~~increase in Prepaid expenses and other assets of $839.7 thousand, and a decrease in operating ~~certificate~~lease obligations of $731.3 thousand. These were partially offset by noncash adjustments of $382.6 thousand for share-based payments, and ~~revenue as well as treatment~~$950.3 thousand for amortization of ~~warrants as a liability.~~right-of-use assets, an increase in accrued liabilities of $729.2 thousand, and an increase in accounts payable of $3.1 million.

Investing Activities. For the ~~nine~~three months ended ~~September 30, 2022,~~March 31, 2023, net cash used for investing activities ~~increased~~decreased by ~~$2.5 million,~~$700 thousand to ~~$4.5 million, consisting primarily of $3.3 million related to Deferred costs and other assets, mainly due to new deposits to aircrafts and $1.1 million~~$200 thousand related to purchases of property and equipment. For the ~~nine~~three months ended ~~September 30, 2021,~~March 31, 2022, Net cash used for investing activities was ~~$1.9 million,~~$890.9 thousand, consisting primarily of ~~$506~~$617.8 thousand related to ~~Deferred~~deferred costs and other assets and ~~$1.4 million~~$273.0 thousand related to ~~purchases~~Purchases of property and equipment.

Financing Activities. For the ~~nine~~three months ended ~~September 30, 2022, net~~March 31, 2023, Net cash provided by financing activities decreased by ~~$12~~$2.0 million to ~~$6.3~~$3.8 million, ~~which~~consisting primarily ~~reflected decrease in~~of $2.5 million of Note Payable, proceeds on issuance of shares of ~~$18.6~~$1.2 million, partially offset by ~~increase of $5.9 million related to notes payable~~$111.4 thousand in ~~2022.~~ Principal payments on finance leases.For ~~2021,~~the three months ended March 31, 2022, Net cash provided by financing activities was ~~$18.7~~$5.7 million, which primarily reflected ~~$18.8~~$5.9 million ~~in proceeds from issuances of shares units,~~related to Note Payable, partially offset by ~~$218.2~~$197.6 thousand for ~~common stock subscribed.~~payments to related parties.

We may access external sources of capital from time to time depending on our cash requirements, assessments 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, our borrowing costs are affected by market conditions and may be adversely impacted by a tightening in credit markets.

We do not expect to pay any significant U.S. federal income tax in ~~2022.~~2023.

Our Chief Executive Officer and 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 Chief Executive Officer and the 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 December 31, ~~2021.~~2022. Our Chief Executive Officer and Chief Financial Officer concluded that, as of December 31, ~~2021,~~2022, the Company’s disclosure controls and procedures were effective.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

There were no changes in our internal control over financial reporting identified in connection with the evaluation required by paragraph (d) of Exchange Act Rules 13a-15 or 15d-15 that occurred during fiscal quarter ended ~~September 30, 2022~~March 31, 2023 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

On October 1, 2021, GEM ~~Yield Bahamas Limited (“GEM”) commenced an action~~has filed initial pleadings in the Supreme Court of the State of New York, County Ofof New York, ~~against the Company (the “GEM Litigation”). GEM claims~~claiming the Company breached ~~a May 4, 2020 promissory note (the “Note”) pursuant to which~~ the Company agreed to make certain payments to GEM in an aggregate amount of CDN $2,000,000 (the “Fee”) in consideration for GEM and GEM Global Yield LLC SCS (collectively the “GEM Parties”) entering into a share subscription agreement ~~(the “SSA”) providing for~~between the ~~GEM Parties to purchase up to CDN$100,000,000 worth of common shares in the Company upon the occurrence of certain events. GEM claims that the Company failed~~parties by failing to pay ~~the first installment of the Fee~~a $500,000 fee due on May 4, 2021 ~~as due~~GEM is requesting repayment in full of the CAD $2,000,000 promissory note issued by the Company to GEM plus accrued interest and ~~that~~costs and expenses related to collection. As of December 31, 2022, the note payable to GEM is recorded in current liabilities on the consolidated balance sheet and the Company expensed the full ~~CDN$2,000,000~~outstanding amount capitalized as deferred financing costs of $2,809,031.

On January 18, 2023 the Court granted summary judgment in favor of GEM. GEM subsequently filed a motion seeking $2,000,000 CAD, plus interest totaling $218,493.87, with an additional $506.02 accruing each day after January 30, 2023 until entry of Judgment. GEM also seeks $112,584.50 in attorney's fees and $4,884.86 in costs. In 2022, interest and attorney's fees were recorded in current liabilities on the consolidated balance sheet and other expenses non-operating on the consolidated statement of operation.

On March 29th, 2023 Global Crossing Airlines and GEM entered into a final settlement which included a payment plan for the $2,000,000 CAD over nine months plus the extention of the ~~Fee is accelerated~~agreement for 12 months. Consequently, GlobalX has adjusted the current liabilities to reverse the previously accrued interest and ~~due now.~~

~~The Company claims that the~~attorney’s fees no longer due. Upon final payment GEM Parties breached the SSA by, among other things, selling the Company’s common shares when prohibited from doing so pursuant to the SSA, as part of a stock manipulation scheme, and that such breach excuses the Company from paying the Fee. The Company is opposing the relief GEM seeks and cross-moving to stay the GEM Litigation on several bases including that (i) the parties agreed to arbitrate any dispute, (ii) GEM’s suit is procedurally improper, and (iii) the GEM Parties’ breach of the SSA excuses the Company from paying the Fee. The Company’s opposition papers were filed on November 19, 2021, at which point GEM had an opportunityagrees to file ~~reply papers. Given the backlog~~a satisfaction of ~~cases at the court due to COVID and other factors, the Company has not heard from or estimate when the court will rule on the parties’ respective filings.~~judgment in County of New York, effectively settling this issue.

There have been no material changes in our risk factors from those disclosed in “Part I. Item 1A. Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, ~~2021.~~2022.

~~Except as previously reported on our Current Reports on Form 8-K, we had no unregistered sales of equity securities during the period from January 1 2022 to September 30, 2022~~None.

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.


PART I - FINANCIAL INFORMATION

	ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS		Page

		Balance Sheets as of ~~September 30, 2022~~March 31, 2023 (unaudited) and December 31, ~~2021~~2022	1

		Statements of Operations for the Three ~~and Nine~~ Months Ended ~~September 30,~~March 31, 2023 and 2022 ~~and 2021~~ (unaudited)	2

		Statements of Stockholders’ Equity for the Three ~~and Nine~~ Months Ended ~~September 30,~~March 31, 2023 and 2022 ~~and 2021~~ (unaudited)	3

		Statements of Cash Flows for the ~~Nine~~Three Months Ended ~~September 30,~~March 31, 2023 and 2022 ~~and 2021~~ (unaudited)	4

		Notes to Financial Statements (unaudited)	5

	ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS		1513

	ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK		2117

	ITEM 4. CONTROLS AND PROCEDURES		2118

PART II - OTHER INFORMATION			2219

	ITEM 6. EXHIBITS		2320

SIGNATURES			2421


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 because XBRL tags are embedded within the Inline XBRL document.
101.SCH		Inline XBRL Taxonomy Extension Schema Document
101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)


SIGNATURE	TITLE	DATE

/s/ Edward Wegel	CEO	~~October 31, 2022~~May 10, 2023
Edward Wegel

/s/ Ryan Goepel	CFO	~~October 31, 2022~~May 10, 2023
Ryan Goepel

/s/ Alan Bird	Director	~~October 31, 2022~~May 10, 2023
Alan Bird

/s/ T. Allan McArtor	Director	~~October 31, 2022~~May 10, 2023
T. Allan McArtor

/s/ David G. Ross	Director	~~October 31, 2022~~May 10, 2023
David G. Ross

/s/ Deborah Robinson	Director	~~October 31, 2022~~May 10, 2023
Deborah Robinson

/s/ Cordia Harrington	Director	~~October 31, 2022~~May 10, 2023
Cordia Harrington


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


	Finance Leases		Operating Leases
Remainder of 2022	$	145,654	$	2,100,000
2023		582,617		8,376,250
2024		582,617		6,712,500
2025		582,617		6,670,000
2026		582,617		5,632,100
2027 and thereafer		912,247		3,188,164
Total minimum lease payments		3,388,369		32,679,014
Less amount representing interest		922,515		6,411,474
Present value of minimum lease payments		2,465,854		26,267,540
Less current portion		317,423		6,165,322
Long-term portion		2,148,431		20,102,218


	Nine Months Ended September 31, 2022			Nine Months Ended September 31, 2021
Numerator:
Net loss	$	(11,381,523	)	$	(15,335,888	)
Denominator:
Weighted average common shares outstanding - Basic		51,776,833			43,572,925
Dilutive effect of stock options, RSUs and warrants		—			—

Weighted average common shares outstanding - Diluted		51,776,833			43,572,925

Basic loss per share	$	(0.22	)	$	(0.35	)
Diluted loss per share	$	(0.22	)	$	(0.35	)


	Three Months Ended September 30,						Three Months Ended March 31,
Operating Fleet	2022		2021		Inc/(Dec)		2023		2022		Inc/(Dec)
A320		6		1		5		6.0		5.0		1.0
A321		1		1		—		2.7		1.0		1.7
Total Operating Average Aircraft Equivalents		7		2		5		8.7		6.0		2.7
Total Block Hours		2,395		380		2,015		3,134		1,729		1,405

	Nine Months Ended September 30,
Operating Fleet	2022		2021		Inc/(Dec)
A320		6		1		5
A321		1		1		—
Total Operating Average Aircraft Equivalents		7		2		5
Total Block Hours		6,254		380		5,874


	Three Months Ended September 30
Non-Operating Expenses (Income)	2022			2021			Inc/(Dec)			% Change
Interest Expense	$	632,344		$	(56,065	)	$	688,409		$	(12	)

	Nine Months Ended September 30
Non-Operating Expenses (Income)	2022			2021			Inc/(Dec)			% Change
Loss on Warrant Valuation		—			2,650,772		$	(2,650,772	)		(100.0	)%
Unrealized Loss (Gain) on Financial Instruments		(15	)		(73,037	)		73,022			(100.0	)%
Interest Expense		882,990			27,081			855,909			3160.6	%
Total Non-Operating Expenses (Income)	$	882,975		$	2,584,338		$	(1,701,363	)		(65.8	)%


	Three Months Ended March 31
Non-Operating Expenses	2023		2022		Inc/(Dec)		% Change
Interest Expense		541,715		16,214		525,501		3241.0	%
Total Non-Operating Expenses	$	541,715	$	16,214	$	525,501		3241.0	%