What changed in this filing

/stocks — the workspaceLOADING

Item 7. Management’s Discussion and Analysis

2023-03-31 compared with 2022-04-14 · 383 added, 285 removed, 68 unchanged (91% of the section changed)

Management’s Discussion and Analysis of Financial Condition and Results of Operations

References to the “Company,” “Inflection Point Acquisition

Corp.,” “our,” “us” or “we” refer to Inflection Point Acquisition Corp.

The following discussion

and analysis of the Company’s financial condition and results of operations should be read in conjunction with the audited financial

statements and the notes thereto contained elsewhere in this Annual Report.

Note Regarding Forward-Looking Statements

This Annual Report includes forward-looking statements.

These forward-looking

statements are based on our current expectations and beliefs concerning future developments and their potential effects on us.

be no assurance that future developments affecting us will be those that we have anticipated.

These forward-looking statements involve

a number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or performance

to be materially different from those expressed or implied by these forward-looking statements.

Our forward-looking statements include,

but are not limited to, statements regarding our or our management team’s expectations, hopes, beliefs, intentions or strategies

regarding the future.

In addition, any statements that refer to projections, forecasts or other characterizations of future events or

circumstances, including any underlying assumptions, are forward-looking statements.

The words “anticipate,” “believe,”

“continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,”

“plan,” “possible,” “potential,” “predict,” “project,” “should,”

“would” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that

a statement is not forward-looking.

Factors that might cause or contribute to such forward-looking statements include, but are not limited

to, those set forth in the Risk Factors section of this Annual Report.

The following discussion and analysis of the Company’s financial

condition and results of operations should be read in conjunction with the audited financial statements and the notes thereto contained

elsewhere in this Annual Report.

We are a blank check company incorporated on January 27, 2021 as a

Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization

or similar business combination with one or more businesses (the “ Initial Business Combination ”).

Our sponsor is Inflection Point Holdings LLC, a Cayman Islands limited

liability company (the “ Sponsor ”).

The registration statement for our initial public offering was declared effective

on September 21, 2021.

On September 24, 2021, we consummated our initial public offering (the “ Initial Public Offering ”

or “ IPO ”) of 30,000,000 units, at $10.00 per unit (the “ Units ”).

Each Unit consists of one of the

Company’s Class A ordinary shares, $0.0001 par value (the “ Class A Ordinary Shares ” or “ Public

Shares ”) and one-half of one redeemable warrant (each, a “ Public Warrant ”).

The underwriters had a 45-day

option from the effective date to purchase up to an additional 4,500,000 Units to cover over-allotments, if any.

On October 29, 2021,

the underwriters partially exercised the over-allotment option (the “ Over-Allotment ” and together with the IPO, the

“ Public Offering ”) and purchased an additional 2,975,000 Units (the “ Over-Allotment Units ”), generating

additional gross proceeds of $29,750,000, and forfeited their option to purchase the remaining 1,525,000 Units.

Simultaneously

with the closing of the IPO, the Sponsor purchased an aggregate of 6,250,000 private placement warrants (“ IPO Private Placement

Warrants ”) at a price of $1.00 per IPO Private Placement Warrants, for an aggregate purchase price of $6,250,000.

29, 2021, simultaneously with the sale of the Over-Allotment Units, the Sponsor purchased an additional 595,000 private placement warrants

(the “ Over-Allotment Private Placement Warrants ” and together with the IPO Private Placement Warrants, the “ Private

Placement Warrants ”), generating aggregate gross proceeds to the Company of $595,000.

Management’s Discussion and Analysis

of Financial Condition and Results of Operations.

You should read the following discussion and

analysis of our financial condition and results of operations in conjunction with the audited financial statements and the notes thereto

included in Part II.

of this Annual Report.

Unless otherwise indicated, references to the

“Company,” “our,” “us” or “we” in this Item 7 refer to Inflection Point Acquisition Corp.,

or IPAX, before the consummation of the Business Combination.

The term “New Intuitive Machines” refers to Intuitive Machines,

after the consummation of the Business Combination.

The financial information included in this

Item 7 is that of IPAX prior to the Business Combination because the Business Combination was consummated subsequent to the period covered

by the audited financial statements included in this Annual Report.

Until February 13, 2023, we were a blank check

company incorporated on January 27, 2021 as a Cayman Islands exempted company under the name, Inflection Point Acquisition Corp., for

the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with

one or more businesses.

Initial Public Offering and Private Placements

On September 24, 2021, we completed our initial

public offering (“IPO”) of 30,000,000 units, at $10.00 per unit (the “Units”), and issued an additional 2,975,000

Units (the “Over-Allotment Units”) to the underwriters on October 29, 2021 upon their partial exercise of their over-allotment

option, generating aggregate gross proceeds to us of $329,750,000.

Each Unit consisted of one of our Class A ordinary shares, $0.0001

par value (the “Class A ordinary shares” or “Public Shares”) and one-half of one redeemable warrant

(each, a “Public Warrant”), with each whole warrant entitling the holder to purchase one Class A ordinary share for $11.50 per

share, subject to adjustment.

Simultaneously with the closing of the IPO, we

sold to our Sponsor, Inflection Point Holdings LLC, a Cayman Islands limited liability company (the “Sponsor”), 6,250,000

private placement warrants (“IPO Private Placement Warrants”) at a price of $1.00 per warrant, and simultaneously with the

sale of the Over-Allotment Units, sold to our Sponsor an additional 595,000 private placement warrants (the “Over-Allotment Private

Placement Warrants” and, together with the IPO Private Placement Warrants, the “Private Placement Warrants”), generating

aggregate gross proceeds to us of $6,845,000.

An aggregate of 12 qualified institutional buyers

(“ Anchor Investors ”) expressed an interest to purchase an aggregate of approximately $322.3 million of the Units to

be sold in the IPO.

None of the Anchor Investors expressed an interest in purchasing more than 9.9% of the Units sold in the IPO.

(“Anchor Investors”) were allocated and purchased a total of 29,540,000 Units or 98.5% of the Units sold in the IPO.

One of the Anchor Investors,

Kingstown 1740 Fund, LP, is an affiliate of the Sponsor, and was allocated and purchased 2,900,000 Units in the IPO.

the Anchor Investors, Kingstown 1740 Fund, LP (“Kingstown 1740”), is an affiliate of our Sponsor, and was allocated and purchased

2,900,000 Units in the IPO.

In addition, subject to each Anchor Investor purchasing

100% of the Units allocated to it, in connection with the closing of the IPO, the Sponsor sold membership interests reflecting an allocation

of Class B ordinary shares, par value $0.0001 per share (the “ Founder Shares ”) to each Anchor Investor, or an aggregate

of 1,625,000 Founder Shares to all Anchor Investors.

The Company estimated the aggregate fair value of these Founder Shares attributable

100% of the Units allocated to it, in connection with the closing of the IPO, our Sponsor sold membership interests reflecting an allocation

of Class B ordinary shares, par value $0.0001 per share (the “Founder Shares”) to each Anchor Investor, amounting to an aggregate

of 1,625,000 Founder Shares to all Anchor Investors collectively.

We estimated the aggregate fair value of these Founder Shares attributable

to Anchor Investors to be approximately $9.68 million, or $5.96 per share.

3 unchanged sentences

Warrants was all charged to shareholder’s equity upon the completion of the IPO.

Transaction costs amounted to $26,658,313, consisting

of $4,595,000 of underwriting commissions, $11,541,250 of deferred underwriting commissions, $9,680,125 of excess fair value of founder

shares, and $841,938 of other offering costs, with $23,439 included in the statement of operations as an allocation for the over-allotment

option, $24,538,134 included in temporary equity as an allocation for the Class A ordinary shares subject to redemption, and $2,096,740

included in additional paid-in capital as an allocation for the Class A ordinary shares not subject to redemption, the Public Warrants

and the Private Placement Warrants.

Following the closing of the IPO on September 24, 2021, $300,000,000

($10.00 per Unit) from the net proceeds of the sale of the Units in the IPO and the sale of the IPO Private Placement Warrants was deposited

into a trust account (the “ Trust Account ”).

Following the closing of the Over-Allotment on October 29, 2021, an additional

$29,750,000 ($10.00 per Over-Allotment Unit) from the net proceeds from the sale of the Over-Allotment Units in the Over-Allotment and

the sale of the Over-Allotment Private Placement Units was deposited into the Trust Account.

The proceeds deposited in the Trust Account

are, and will be, invested only in U.S.

government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company

Act of 1940, as amended (the “ Investment Company Act ”), having a maturity of 185 days or less or in money market funds

meeting certain conditions under Rule 2a-7 promulgated under the Investment Company Act which invest only in direct U.S.

government treasury

Except with respect to interest earned on the funds held in the Trust Account that may be released to the Company to pay

taxes, if any, the proceeds from the Public Offering and the sale of the Private Placement Warrants will not be released from the Trust

Account until the earliest of (i) the completion of an Initial Business Combination, (ii) the redemption of the Company’s Public

Shares if the Company is unable to complete the Initial Business Combination by September 24, 2023, subject to applicable law, or (iii)

the redemption of the Company’s Public Shares properly submitted in connection with a shareholder vote to amend the Company’s

Amended and Restated Memorandum and Articles of Association to (A) modify the substance or timing of the Company’s obligation to

allow redemption in connection with the Initial Business Combination or to redeem 100% of its Public Shares if the Company has not consummated

an Initial Business Combination by September 24, 2023 or (B) with respect to any other material provisions relating to shareholders’

rights or pre-Initial Business Combination activity.

The proceeds deposited in the Trust Account could become subject to the claims of

the Company’s creditors, if any, which could have priority over the claims of the Company’s Public Shareholders.

The Company’s management has broad discretion with respect to

the specific application of the net proceeds of the Public Offering and the sale of the Private Placement Warrants although substantially

all of the net proceeds are intended to be generally applied toward consummating an Initial Business Combination (less deferred underwriting

commissions).

The Company’s Initial Business Combination must be with one or more operating businesses or assets with a fair market

value equal to at least 80% of the value of the Trust Account (excluding the amount of any deferred underwriting discount held in trust

and taxes payable on the income earned on the Trust Account).

However, the Company will only complete an Initial Business Combination

if the post-transaction company owns or acquires 50% or more of the issued and outstanding voting securities of the target or otherwise

acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment

There is no assurance that the Company will be able to successfully effect an Initial Business Combination.

The Company will have until September 24, 2023

to complete the Initial Business Combination (the “ Combination Period ”).

However, if the Company is unable to complete

the Initial Business Combination within the Combination Period, the Company will (i) cease all operations except for the purpose of winding

up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the Public Shares, at a per-share price,

payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest earned on the funds held in the

Trust Account (less tax payable and up to $100,000 of interest to pay dissolution expenses) divided by the number of then outstanding

Public Shares, which redemption will completely extinguish Public Shareholders’ rights as shareholders (including the right to receive

further liquidation distributions, if any), and (iii) as promptly as reasonably possible following such redemption, subject to the approval

of the Company’s remaining shareholders and the Company’s board of directors, liquidate and dissolve, subject in the case

of clauses (ii) and (iii) to the Company’s obligations under Cayman Islands law to provide for claims of creditors and in all cases

subject to the other requirements of applicable law.

Liquidity and Capital Resources;

Going Concern

As of December 31, 2021, we had approximately $0.36 million in cash

and working capital of $0.62 million.

September 30, 2021, the Sponsor agreed to provide us with loans in such amounts as may be required by us to fund our working capital

requirements up to an aggregate of $250,000.

In addition, in order to finance transaction costs in connection with an Initial Business

Combination, our Sponsor or an affiliate of our Sponsor or certain of our officers and directors may, but are not obligated to, provide

Working Capital Loans to us.

As of December 31, 2021, there were no amounts outstanding under any Working Capital Loans.

Based on the foregoing, it is possible that the $0.36 million in cash

held outside the Trust Account might not be sufficient to allow the Company to operate for at least 12 months from the date of this Annual

Report, assuming that an Initial Business Combination is not consummated during that time.

Until consummation of its Initial Business

Combination, the Company will be using these funds for paying existing accounts payable, identifying and evaluating prospective Initial

Business Combination candidates, performing due diligence on prospective target businesses, paying for travel expenditures, selecting

the target business to merge with or acquire, and structuring, negotiating and consummating the Initial Business Combination.

Company can raise additional capital through Working Capital Loans from the Sponsor, certain of the Company’s officers and directors,

or through loans from third parties.

If the Company is unable to raise additional capital, it may be required to take additional measures

to conserve liquidity, which could include, but not necessarily be limited to, curtailing operations, suspending the pursuit of its business

plan, and reducing overhead expenses.

The Company cannot provide assurance that new financing will be available to it on commercially

acceptable terms, if at all.

These conditions raise substantial doubt about the Company’s ability to continue as a going concern

for a reasonable period of time, which is considered to be one year from the issuance date of these financial statements.

and Uncertainties

continues to evaluate the impact of the COVID-19 pandemic and has concluded that while it is reasonably possible that the virus could

have a negative effect on the Company’s financial position, results of its operations, and/or search for a target company, the

specific impact is not readily determinable as of the date of this Annual Report.

The financial statements do not include any adjustments

that might result from the outcome of this uncertainty.

of Operations

Transaction costs from the IPO amounted to $26,658,313,

consisting of $4,595,000 of underwriting commissions, $11,541,250 of deferred underwriting commissions, $9,680,125 of excess fair value

of Founder Shares, and $841,938 of other offering costs, with $23,439 allocated to the over-allotment option, $24,538,134 allocated to

the Class A ordinary shares subject to redemption, and $2,096,740 allocated to the Class A ordinary shares not subject to redemption,

the Public Warrants and the Private Placement Warrants.

Following the consummation of the IPO, including

the sale of the Over-Allotment Units, a total of $329,750,000 from the proceeds of the Units in the IPO and the sale of the Over-Allotment

Units was deposited into a trust account (the “Trust Account”).

The proceeds from the Private Placement Warrants were used

to pay a portion of the transaction expenses with the remainder deposited into the operating account.

Business Combination with Intuitive Machines

On September 16, 2022, the Company entered

into a business combination agreement (the “Business Combination Agreement”) with Intuitive Machines OpCo.

10, 2023, as contemplated by the Business Combination Agreement and described in the section titled “The Business Combination Proposal”

of the Company’s final prospectus and definitive proxy statement, dated January 24, 2023 (the “Proxy Statement/Prospectus”)

and filed with the SEC on January 24, 2023, the Company filed a notice of deregistration with the Cayman Islands Registrar of Companies,

together with the necessary accompanying documents, and filed a certificate of incorporation (the “Certificate of Incorporation”)

and a certificate of corporate domestication with the Secretary of State of the State of Delaware, pursuant to which the Company was domesticated

and continues as a Delaware corporation, changing its name to “Intuitive Machines, Inc.” (the “Domestication”).

prior to the Domestication, each of the then issued and outstanding Class B ordinary shares of the Company, par value $0.0001 per share

(each, a “Class B ordinary share”), converted automatically, on a one-for-one basis, into a Class A ordinary share of the

As a result of and upon the effective time of the Domestication, among other things, (1) each of the then issued and outstanding

Class A ordinary shares automatically converted, on a one-for-one basis, into a share of the Company’s Class A common stock, par

value $0.0001 per share (the “Class A Common Stock”);

(2) each of the then issued and outstanding warrants representing the

right to purchase one Class A ordinary share automatically converted into a warrant to acquire one share of the Company’s Class

A Common Stock pursuant to the related warrant agreement (each warrant, an “Intuitive Machines Warrant”);

and (3) each of

the then issued and outstanding Units were canceled and each holder thereof was entitled to one share of the Company’s Class A Common

Stock and one-half of one Intuitive Machines Warrant per unit.

On February 13, 2023, we consummated the transactions

contemplated by the Business Combination Agreement, whereby (i) Intuitive Machines OpCo appointed

the Company as its managing member, (ii) we issued to certain existing members of Intuitive Machines OpCo prior to the Business Combination,

a number of shares of our Class B Common Stock, par value $0.0001 per share, having one vote per share and no economic rights or our Class

C Common, par value $0.0001 per share, having three votes per share and no economic rights, in each case, equal to the number of common

units of Intuitive Machines OpCo (“Intuitive Machines OpCo Common Units”) held by such person as of and on the Closing Date

and (iii) we contributed to Intuitive Machines OpCo an amount in cash (the “Available Closing Cash”) equal to the sum of (without

duplication):

(a) all amounts in our Trust Account, less (x) amounts required for the redemptions of Cayman Class A Shares by shareholders

of IPAX prior to the Business Combination and (y) our and Intuitive Machines OpCo’s transaction expenses, plus (b) the aggregate

proceeds actually received by IPAX from the Securities Purchase Agreement (the “Securities Purchase Agreement”) with certain

investors (collectively, the “Series A Investors”), pursuant to which the Series A Investors purchased $26.0 million (the

“Series A Investment”) of 10% Series A Cumulative Convertible Preferred Stock, par value $0.0001 per share, of the Company

(“Series A Preferred Stock”) and warrants exercisable to purchase shares of our Class A Common Stock at an initial exercise

price of $15.00 (the “Preferred Investor Warrants”), plus (c) all other cash and cash equivalents of IPAX, determined in accordance

with GAAP as of 11:59 p.m.

Eastern Time on February 12, 2023 plus (d) the Founder Subscription Amount (as defined in the Business Combination

Agreement) in exchange for the issuance by Intuitive Machines OpCo to us (w) a number of Intuitive Machines OpCo Common Units equal to

the number of shares of our Class A Common Stock issued and outstanding as of the Closing Date, (x) a number of warrants of Intuitive

Machines OpCo (the “Intuitive Machines OpCo Warrants”) equal to the number of Intuitive Machines Warrants issued and outstanding

as of the Closing Date, (y) a number of Series A preferred units of Intuitive Machines (the “Series A Preferred Units”) equal

to the number of shares of Series A Preferred Stock issued and outstanding as of the Closing Date and issued to the Series A Investors

and (z) a number of Intuitive Machines OpCo preferred investor warrants (the “Intuitive Machines OpCo Preferred Investor Warrants”)

equal to the number of Preferred Investor Warrants delivered to the Series A Investors on the Closing Date (together with the Domestication,

the “Transactions”).

For additional information regarding the Transactions,

see the section titled “The Business Combination Proposal” of the Company’s final

prospectus and definitive proxy statement, dated January 24, 2023 (the “Proxy Statement/Prospectus”) and filed with the SEC

on January 24, 2023 and the Company’s Current Report on Form 8-K filed on February 14, 2023.

As a result of the Business Combination, our only

direct assets consist of Intuitive Machines OpCo Common Units, and substantially all of our assets and business are held by Intuitive

Machines OpCo and its subsidiaries.

See Note 1 in the notes to our audited financial statements included in Part II.

Item 8 in this Annual

The Series A Investment

On September 16, 2022, concurrently with the execution

of the Business Combination Agreement, IPAX entered into a purchase agreement (the “Series A Purchase Agreement”) with Kingstown

1740 (an existing security holder of the Company and an affiliate of the Sponsor) and Ghaffarian Enterprises, LLC (an affiliate of Kamal

Ghaffarian, an Intuitive Machines founder) (collectively, the “Series A Investors”), pursuant to which, and on the terms and

subject to the conditions of which, New Intuitive Machines agreed to issue and sell to the Series A Investors (i) an aggregate of 26,000

shares of Series A Preferred Stock which would be convertible into shares of New Intuitive Machines Class A Common Stock and (ii) warrants

to purchase 541,667 shares of New Intuitive Machines Class A Common Stock at an initial exercise price of $15.00 per share, subject to

adjustment (the “Preferred Investor Warrants”).

The Series A Investment was consummated following the Domestication but immediately

prior to the Closing.

Tax Receivable Agreement

On February 13, 2023, in connection with the consummation

of the Transactions and as contemplated by the Business Combination Agreement, New Intuitive Machines entered into a Tax Receivable Agreement

(the “Tax Receivable Agreement”) with Intuitive Machines OpCo and certain members of Intuitive Machines OpCo.

See Part III.

“Certain Relationships and Related Transactions, and Director Independence – Post-Business Combination Arrangements

-Tax Receivables Agreement” for further information.

Equity Facility

On September 16, 2022, the Company entered

into a common stock purchase agreement (the “Cantor Purchase Agreement”), dated September 16, 2022, with CF Principal Investments

LLC (“CFPI”) relating to an equity facility under which shares of newly issued New Intuitive Machines Class A Common Stock

may be sold to CFPI by New Intuitive Machines.

Pursuant to the terms of the Cantor Purchase Agreement, New Intuitive Machines will have

the right, but not the obligation, from time to time at its sole discretion, until the first day of the month following the 18-month period

from and after the Commencement (as defined in the Cantor Purchase Agreement), to direct CFPI to purchase up to the lesser of (i) $50 million

of newly issued New Intuitive Machines Class A Common Stock and (ii) the Exchange Cap (as defined in the Cantor Purchase Agreement),

by delivering written notice to CFPI prior to the commencement of trading on any trading day, subject to certain customary conditions

and limitations set forth in the Cantor Purchase Agreement.

In connection with the execution of the Cantor Purchase Agreement, the Company

agreed to issue 100,000 shares (the “Commitment Shares”) of New Intuitive Machines’ Class A Common Stock to CFPI.

Company entered into a registration rights agreement with CFPI, pursuant to which it agreed to register for resale, pursuant to Rule 415

under the Securities Act of 1933, as amended (the “Securities Act”), the shares of New Intuitive Machines’ Class A Common

Stock that are sold to CFPI under the equity facility and the Commitment Shares.

Subscription Agreements

On February 13, 2023, New Intuitive Machines and

Intuitive Machines OpCo entered into subscription agreements with certain legacy investors in Intuitive Machines OpCo (the “SAFE

Investors”) that held simple agreements for future equity (“SAFEs”) of Intuitive Machines OpCo, pursuant to which, among

other things, the SAFE Investors contributed the SAFEs to Intuitive Machines and, in exchange for such contribution, New Intuitive Machines

issued an aggregate of 2,066,666 shares of Class A Common Stock to the SAFE Investors (the “SAFE Exchange”).

Immediately following

the consummation of the SAFE Exchange, New Intuitive Machines and Intuitive Machines OpCo exchanged all of the SAFEs received by Intuitive

Machines in the SAFE Exchange for 2,066,666 Intuitive Machines OpCo Common Units in a recapitalization of the SAFEs in order to maintain

a one-to-one ratio of the Intuitive Machines OpCo Common Units owned by Intuitive Machines and the number of outstanding shares of New

Intuitive Machines’ Class A Common Stock in accordance with the A&R Operating Agreement.

Results of Operations

As of December 31, 2022, we had not commenced

any operations.

All activity for the period from January 27, 2021 (inception) through December 31, 2021 relates to our formation and the

Public Offering and, subsequent to the closing of the IPO, identifying a target company for an Initial Business Combination.

have neither engaged in any operations nor generated any revenues to date.

We will not generate any operating revenues until after

the completion of our Initial Business Combination, at the earliest.

We will generate non-operating income in the

form of interest income on cash and cash equivalents from the proceeds derived from the Public Offering.

We incur increased expenses

as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence

All activity for the period from January 27, 2021 (inception) through December 31, 2022 related to our formation and the

IPO and, subsequent to the closing of the IPO, identifying a target company for an initial business combination.

We have neither

engaged in any operations nor generated any revenues or income during the period from inception through December 31, 2022 other than non-operating income in

the form of interest income on cash and cash equivalents from the proceeds derived from the IPO.

Since our IPO through December

31, 2022, we incurred increased expenses as a result of being a public company (for legal, financial reporting, accounting and auditing

compliance), as well as for due diligence expenses.

For the year ended December 31, 2022, we had net

loss of $190,408, which consisted primarily of interest income earned on cash and marketable securities held in Trust Account amounting

to $4,833,790, offset by formation and operating costs amounting to $5,024,198.

For the period from January 27, 2021 (inception)

2 unchanged sentences

amounting to $5,798, and change in fair value of over-allotment liability of $193,471.

do not have any long-term debt obligations, capital lease obligations, operating lease obligations, purchase obligations or long-term

of December 31, 2021, we did not have any off-balance sheet arrangements as defined in Item 303(a)(4)(ii) of Regulation S-K.

Administrative

Services Agreement

on September 22, 2021, we agreed to pay Kingstown Capital Management L.P., an affiliate of the Sponsor, $15,000 per month for office

space, utilities and secretarial and administrative support services.

Upon the earlier of the completion of the Initial Business

Combination or our liquidation, we will cease paying such monthly fees.

The holders of the (i) Founder Shares and the Class A Ordinary

Shares issuable upon conversion of Founder Shares, (ii) Forward Purchase Shares, (iii) Private Placement Warrants and the Class A

Ordinary Shares underlying such Private Placement Warrants and (iv) warrants that may be issued upon conversion of Working Capital

Loans and the Class A Ordinary Shares underlying such warrants will have registration rights to require us to register a sale of

any of our securities held by them and any other securities of the Company acquired by them prior to the consummation of our Initial Business

Combination pursuant to a registration rights agreement entered into in connection with the IPO.

Pursuant to the registration rights agreement

and assuming $1,500,000 of Working Capital Loans are converted into additional Private Placement Warrants, we will be obligated to register

up to 21,588,750 Class A Ordinary Shares and 8,345,000 Private Placement Warrants.

The number of Class A Ordinary Shares includes

(i) 8,243,750 Class A Ordinary Shares to be issued upon conversion of the Founder Shares, (ii) 5,000,000 Forward Purchase Shares,

(iii) 6,845,000 Class A Ordinary Shares underlying the Private Placement Warrants and (iv) 1,500,000 Class A Ordinary Shares

underlying the warrants issuable upon conversion of working capital loans.

The number of warrants includes 6,845,000 Private Placement

Warrants and 1,500,000 additional warrants issuable upon the conversion of Working Capital Loans.

The holders of these securities are

entitled to make up to three demands, excluding short form demands, that we register such securities.

In addition, the holders have certain

“piggy-back” registration rights with respect to registration statements filed subsequent to our completion of our Initial

Business Combination.

Liquidity and Capital Resources

As of December 31, 2022, we had $14,932 in cash and working capital

deficit of $4,082,477.

On September 30, 2021, our Sponsor agreed to provide

us with loans in such amounts as may be required by us to fund our working capital requirements up to an aggregate of $250,000.

March 8, 2022, our Sponsor agreed to provide us with loans in such amounts as may be required by us to fund our working capital requirements

up to an aggregate of $500,000.

On August 4, 2022, our Sponsor agreed to loan

the Company up to $1,000,000 to be used for ongoing expenses reasonably related to the business of the Company and the consummation of

an initial business combination pursuant to a convertible promissory note (the “Working Capital Note”).

All unpaid principal under the Working Capital

Note was due and payable in full on the earlier of (i) September 24, 2023 and (ii) the effective date of an initial business combination,

involving the Company and one or more businesses (such earlier date, the “Maturity Date”), unless accelerated upon the occurrence

of an event of default as set forth in the Working Capital Note.

The Sponsor had the option, at any time on or prior to the Maturity Date,

to convert up to $1,000,000 outstanding under the Working Capital Note into warrants to purchase Class A ordinary shares at a conversion

price of $1.00 per warrant, with each warrant entitling the holder to purchase one Class A ordinary share at a price of $11.50 per share,

subject to the same adjustments applicable to the Private Placement Warrants.

As of December 31, 2022, there was $625,000 outstanding

under the Working Capital Note.

Subsequent to December 31, 2022, the Company drew an additional $100,000 on the Working Capital Note.

The Working Capital Note was subsequently repaid at Closing.

Until the consummation of the Business Combination,

the Company used the funds not held in the Trust Account for identifying and evaluating target businesses, performing due diligence on

prospective target businesses, traveling to and from the offices, plants or similar location of prospective target businesses or their

representatives or owners, reviewing corporate documents and material agreements of prospective target businesses and structuring, negotiating

and completing the Business Combination.

Upon the closing of the Business Combination,

we received approximately $34 million of gross proceeds to fund operations.

We believe that the cash available from the consummation of

the Business Combination and related transactions will be sufficient to fund the short-term liquidity needs and the execution of the business

plan through at least the twelve month-period from the date of the Business Combination.

Prior to the closing of the Business Combination,

holders of 27,481,818 shares of Class A ordinary shares exercised their right to redeem such shares for cash at a price of approximately

$10.18 per share for aggregate payments of $279,884,314.

We may need to raise additional capital to fund our operations and our business

There can be no assurance that we will be successful in obtaining capital sufficient to meet our operating needs on terms or a timeframe

acceptable to us or at all.

Further, in the event that market conditions preclude our ability to obtain sufficient capital, we may be

required to evaluate additional alternatives in restructuring our business and our capital structure.

Financial Statements and MD&A of Intuitive

Machines OpCo

In light of the consummation of the Business Combination,

the historical financial statements of IPAX ceased to be representative of the consolidated financial position, results of operations,

stockholders’ equity and cash flows of New Intuitive Machines.

As described in the “Basis of Presentation” section of

this Annual Report, in future reporting periods, our

financial statements will be prepared on a consolidated basis with the financial statements of Intuitive Machines OpCo beginning on the

Closing Date and will represent a continuation of the financial statements of Intuitive Machines OpCo.

The consolidated financial position, results of operations,

stockholders’ equity and cash flows of Intuitive Machines OpCo as of and for the years ended December 31, 2022 and 2021 (“OpCo

Financial Statements”), and management’s discussion and analysis of the OpCo Financial Statements, including known trends

and uncertainties regarding the future consolidated financial position, results of operations, stockholders’ equity and cash flows

of Intuitive Machines OpCo will be filed as exhibits to Amendment No.

2 to the Company’s Current Report on Form 8-K to be filed

with the SEC on or about March 30, 2023.

Risks and Uncertainties

We have evaluated the impact of the COVID-19 pandemic

and Russian-Ukraine war on the industry and have concluded that while it is reasonably possible that the virus and the war could have

a negative effect on our financial position, results of its operations and/or search for a target company, the specific impact is not

readily determinable as of the date of the financial statements included elsewhere in this Annual Report.

The financial statements do

not include any adjustments that might result from the outcome of this uncertainty.

Off-Balance Sheet Financing Arrangements

As of December 31, 2022, we had no obligations,

assets or liabilities, which would be considered off-balance sheet arrangements.

Contractual Obligations

As of December 31, 2022, we did not have any long-term

debt obligations, capital lease obligations, operating lease obligations, purchase obligations or long-term liabilities.

Administrative Services Agreement

Commencing on September 21, 2021, we agreed to

pay Kingstown Capital Management L.P., an affiliate of our Sponsor, $15,000 per month for office space, utilities and secretarial

and administrative support services.

Upon the consummation of the Business Combination, we ceased paying such monthly fees.

Registration Rights

As of December 31, 2022, certain securityholders

of IPAX had registration rights to require us to register a sale of any of our securities held by them and our any other securities acquired

by them prior to the consummation of our initial business combination pursuant to a registration rights agreement entered into in connection

with the IPO.

Pursuant to the registration rights agreement and assuming $1,500,000 of Working Capital Loans were converted into additional

warrants, we would have been obligated to register up to 21,588,750 Class A ordinary shares and 8,345,000 warrants.

The holders of

these securities were entitled to make up to three demands, excluding short form demands, that we register such securities.

the holders had certain “piggy-back” registration rights with respect to registration statements filed subsequent to our completion

of our initial business combination.

We will bear the expenses incurred in connection with the filing of any such registration statements.

The Company granted the underwriters a 45-day

option from the date of IPO prospectus to purchase up to an additional 4,500,000 Units to cover over-allotments, if any.

On October 29,

2021, the underwriters partially exercised the over-allotment option and purchased 2,975,000 Over-Allotment Units, generating aggregate

gross proceeds of $29,750,000, and forfeited their option to purchase the remaining 1,525,000 Units.

The underwriters were entitled to a cash underwriting

discount of 2.0% per Unit, or $4,595,000, excluding the proceeds from the purchase of an aggregate of 10,000,000 Units by certain of our

Anchor Investors, $4,000,000 of which was payable upon the closing of the IPO and $595,000 was payable upon closing of the Over-Allotment.

Additionally, Citigroup Global Markets Inc.

will be entitled to a deferred underwriting discount of 3.5% of the gross proceeds

of the Public Offering, or $11,541,250 upon the completion of the Company’s Initial Business Combination.

The deferred fee will

become payable from the amounts held in the Trust Account solely in the event that the Company completes an Initial Business Combination,

subject to the terms of the underwriting agreement.

At the Closing, the Company, the Sponsor and certain

securityholders of the Company entered into an amended and restated registration rights agreement (the “A&R Registration Rights

Agreement”), pursuant to which, among other things, the Sponsor and such securityholders were granted certain customary registration

rights, on the terms and subject to the conditions therein, with respect to securities of the Company that they hold following the Business

See Part III.

“Certain Relationships and Related Transactions, and Director Independence – A&R Registration

Rights Agreement.”

Underwriting Agreement

We granted the underwriters a 45-day option from

the effective date of the IPO to purchase up to an additional 4,500,000 Units to cover over-allotments, if any.

On October 29, 2021, the

underwriters partially exercised the over-allotment option and purchased 2,975,000 Over-Allotment Units, generating aggregate gross proceeds

of $29,750,000, and forfeited their option to purchase the remaining 1,525,000 Units.

The Company provided a discount to the underwriters

at the closing of the Public Offering of 2.0% per Unit, or $4,595,000, excluding the proceeds from the purchase of an aggregate of 10,000,000

Units by certain of our Anchor Investors, $4,000,000 of which was payable upon the closing of the IPO and $595,000 was payable upon closing

of the Over-Allotment.

Additionally, the underwriting agreement states that the Company will pay Citigroup Global Markets Inc.

deferred discount of $0.35 per Unit sold in the Public Offering including pursuant to the Over-Allotment, or an aggregate of $11,541,250

upon the Company’s completion of an initial business combination, which would be payable from the amounts held in the Trust Account

solely in the event that we complete an initial business combination, subject to the terms of the underwriting agreement.

November 27, 2022, in connection with the proposed Business Combination, Citi agreed to waive its entitlement to the deferred underwriting

commission of $11,541,250 to which it became entitled upon completion of the Company’s IPO, subject to the completion of an initial

business combination .

As a result, the Company recorded

$11,541,250 to additional paid-in capital in relation to the reduction of the deferred underwriter fee in the accompanying condensed financial

As of December 31, 2022 and December 31, 2021, the deferred underwriting fee payable was $0 and $11,541,250, respectively.

Professional Service Agreement

The Company reimburses its Sponsor for services

provided by one of the Sponsor’s employees who serves as the Company’s Chief of Staff (“ COS ”).

receives $12,500 per month for services rendered, commencing September 25, 2021, through the closing of our initial business combination.

For the period from January 27, 2021 (date of inception) through December 31, 2021, the Company recorded $40,000 of compensation for services

As of December 31, 2021, there was no balance due to the COS.

We reimbursed our Sponsor for services provided

by one of our Sponsor’s employees who served as our Chief of Staff (“COS”).

The COS received $12,500 per month for services

rendered, commencing September 25, 2021, through the closing of our initial business combination.

For the year ended December 31, 2022,

we recorded $191,668 of compensation for services provided.

As of December 31, 2022, there was $0 due to the COS.

Upon the consummation

of the Transactions, the professional services agreement was terminated.

Critical Accounting Policies

14 unchanged sentences

to the Public Offering.

Offering costs are allocated to the separable financial instruments to be issued in the Public Offering based

on a relative fair value basis, compared to total proceeds received.

Offering costs are allocated to the separable financial instruments issued in the Public Offering based on

a relative fair value basis, compared to total proceeds received.

Transaction costs amounted to $26,658,313, consisting of $4,595,000

of underwriting commissions, $11,541,250 of deferred underwriting commissions, $9,680,125 of excess fair value of founder shares, and

$841,938 of other offering costs, with $23,439 included in the statement of operations as an allocation for the over-allotment option,

$841,938 of other offering costs, with $23,439 included in the statements of operations as an allocation for the over-allotment option,

$24,538,134 included in temporary equity as an allocation for the Class A ordinary shares subject to redemption, and $2,096,740 included

2 unchanged sentences

Subject to each Anchor Investor purchasing 100%

of the Units allocated to it in the IPO, and in connection with the closing of the IPO, the Sponsor sold membership interests reflecting

of the Units allocated to it in the IPO, and in connection with the closing of the IPO, our Sponsor sold membership interests reflecting

an allocation of an aggregate of 1,625,000 Founder Shares to the Anchor Investors collectively.

The Company, through an independent valuations

We, through an independent valuations

expert, estimated the aggregate fair value of these Founder Shares attributable to Anchor Investors to be approximately $9.68 million,

2 unchanged sentences

Accounting Bulletin Topic 5A.

A Ordinary Shares Subject to Possible Redemption

of the Class A Ordinary Share sold as part of the Units in the Public Offering contain a redemption feature which allows for the redemption

of such Public Shares in connection with the Company’s liquidation, if there is a shareholder vote or tender offer in connection

with the Initial Business Combination and in connection with certain amendments to the Company’s Amended and Restated Memorandum

and Articles of Association.

In accordance with SEC and its staff’s guidance on redeemable equity instruments, which has been codified

in ASC 480-10-S99, redemption provisions not solely within the control of the Company require ordinary shares subject to redemption to

be classified outside of permanent equity.

Class A Ordinary Shares Subject to Possible

All of the Class A ordinary shares sold as part

of the Units in the IPO contain a redemption feature which allows for the redemption of such Public Shares in connection with our liquidation,

if there is a shareholder vote or tender offer in connection with an initial business combination and in connection with certain amendments

to our amended and restated memorandum and articles of association.

In accordance with SEC and its staff’s guidance on redeemable

equity instruments, which has been codified in ASC 480-10-S99, redemption provisions not solely within our control require ordinary shares

subject to redemption to be classified outside of permanent equity.

The Class A ordinary shares are subject to SEC

1 unchanged sentence

If it is probable that the

equity instrument will become redeemable, the Company has the option to either accrete changes in the redemption value over the period

from the date of issuance (or from the date that it becomes probable that the instrument will become redeemable, if later) to the earliest

redemption date of the instrument or to recognize changes in the redemption value immediately as they occur and adjust the carrying amount

of the instrument to equal the redemption value at the end of each reporting period.

The Company recognizes changes in redemption value

immediately as they occur.

Immediately upon the closing of the IPO and the Over-Allotment, the Company recognized the remeasurement from

initial book value to redemption amount value.

The change in the carrying value of redeemable ordinary shares resulted in charges against

additional paid-in capital.

Party Redemption Waiver Agreement

In September 2021, the Company entered into a

redemption waiver agreement with one of its Anchor Investors, Kingstown 1740 Fund, LP, whereby Kingstown 1740 Fund, LP agreed to waive

its redemption rights on 1,386,989 Class A Ordinary Shares it holds, and these Class A Ordinary Shares are classified as shareholders’

equity instrument will become redeemable, we have the option to either accrete changes in the redemption value over the period from the

date of issuance (or from the date that it becomes probable that the instrument will become redeemable, if later) to the earliest redemption

date of the instrument or to recognize changes in the redemption value immediately as they occur and adjust the carrying amount of the

instrument to equal the redemption value at the end of each reporting period.

We recognize changes in redemption value immediately as

Immediately upon the closing of the IPO and the Over-Allotment, we recognized the remeasurement from initial book value to

redemption amount value.

The change in the carrying value of redeemable ordinary shares resulted in charges against additional paid-in

Related Party Redemption Waiver Agreement

In September 2021, we entered into a redemption

waiver agreement with one of our Anchor Investors, Kingstown 1740, whereby Kingstown 1740 agreed to waive its redemption rights on 1,386,989

Class A ordinary shares it held.

These Class A ordinary shares are classified as shareholders’ equity in the financial statements

included in this Annual Report.

Net Loss Per Ordinary Share

We comply with accounting and disclosure requirements

of ASC Topic 260, “Earnings Per Share.” Our statement of operations include a presentation of income per share for ordinary

shares subject to possible redemption in a manner similar to the two-class method of income per share.

of ASC Topic 260, “Earnings Per Share.” Our statements of operations include a presentation of loss per share for ordinary

shares subject to possible redemption in a manner similar to the two-class method of loss per share.

The remeasurement associated with

the redeemable Class A ordinary shares is excluded from net loss per ordinary share as the redemption value approximates fair value.

income per share, basic and diluted, for Class A redeemable ordinary shares is calculated by dividing interest income earned and realized

gains or losses on the Trust Account for the period from January 27, 2021 (inception) through December 31, 2021, by the weighted average

number of Class A redeemable ordinary shares outstanding since original issuance.

The Company has not considered the effect of the Public

Warrants or the Private Placement Warrants to purchase an aggregate of 23,332,500 of the Company’s Class A Ordinary Shares

in the calculation of diluted income per share, since their exercise is contingent upon future events.

Net income per share, basic

and diluted, for Class A and Class B non-redeemable ordinary shares is calculated by dividing the net income, adjusted for income or loss

attributable to Class A redeemable ordinary shares, by the weighted average number of Class A and Class B non-redeemable ordinary shares

outstanding for the period.

Class A and Class B non-redeemable ordinary shares includes the Founder Shares as these shares do not have

any redemption features and do not participate in the income or losses of the Trust Account.

At December 31, 2021, we did not have any

dilutive securities and other contracts that could, potentially, be exercised or converted into ordinary shares and then share in the

earnings of our company.

As a result, diluted income per share is the same as basic income per share for the period presented.

loss per share, basic and diluted, for Class A redeemable ordinary shares is calculated by dividing interest income earned and realized

gains or losses on the Trust Account for the year ended December 31, 2022 and for the period from January 27, 2021 (Inception) to December

31, 2021, by the weighted average number of Class A ordinary shares outstanding since original issuance.

We have not considered the effect

of the Public Warrants or the Private Placement Warrants to purchase an aggregate of 23,332,500 of our Class A ordinary shares in

the calculation of diluted loss per share, since their exercise is contingent upon future events.

Net loss per share, basic and diluted,

for Class A and Class B non-redeemable ordinary shares is calculated by dividing the net loss, adjusted for income or loss attributable

to Class A ordinary shares, by the weighted average number of Class A and Class B non-redeemable ordinary shares outstanding for the period.

Class A non-redeemable ordinary shares and Class B non-redeemable ordinary shares, which include the Founder Shares, do not have any redemption

features and do not participate in the income or losses of the Trust Account.

At December 31, 2022 and 2021, we did not have any dilutive

securities and other contracts that could, potentially, be exercised or converted into ordinary shares and then share in the earnings

of our company.

As a result, diluted loss per share is the same as basic loss per share for the period presented.

Derivative Financial Instruments

We evaluate our financial instruments to determine

if such instruments are derivatives or contain features that qualify as embedded derivatives in accordance with ASC Topic 815, “Derivatives

and Hedging.” Derivative instruments are initially recorded at fair value on the grant date and re-valued at each reporting date,

with changes in the fair value reported in the statements of operations.

Derivative assets and liabilities are classified in the balance

sheets as current or non-current based on whether or not net-cash settlement or conversion of the instrument could be required within

12 months of the balance sheet date.

We evaluated the warrants in accordance with ASC

1 unchanged sentence

or tender offer provisions in the warrant agreement that precluded the warrants from being accounted for as components of equity, and

the Warrants meet the criteria in ASC 815-40-25 to be classified in shareholders’ equity.

Fair value of the Public and Private Placement

Warrants was determined by an independent valuation expert as of September 24, 2021 (the date of the IPO) and October 29, 2021 (the date

the over-allotment option was exercised) using a Monte Carlo Model.

the warrants meet the criteria in ASC 815-40-25 to be classified in shareholders’ deficit.

Fair value of the Public and Private

Placement Warrants was determined by an independent valuation expert as of September 24, 2021 (the date of the IPO) and October 29, 2021

(the date of the Over-Allotment) using a Monte Carlo Model.

Proceeds from the IPO and subsequent partial exercise of the over-allotment

5 unchanged sentences

In September 2021, we entered into a forward purchase

agreement (“FPA”) pursuant to which certain affiliates of the Sponsor (“ Kingstown ”) agreed to purchase

up to 5,000,000 forward purchase Class A ordinary shares (“ Forward Purchase Shares ”), for $10.00 per share, or an aggregate

amount of up to $50,000,000, in a private placement that will close concurrently with the closing of our Initial Business Combination,

subject to approval by the Kingstown investment committee.

We have the right, in our sole discretion, to reduce the amount of Forward

Purchase Shares that Kingstown may purchase pursuant to the FPA.

We have not considered the effect of the Forward Purchase Shares in the

calculation of diluted income per share, since their issuance is contingent upon future events.

agreement (“FPA”) pursuant to which certain affiliates of our Sponsor (“Kingstown”) agreed to purchase up to 5,000,000

forward purchase Class A ordinary shares (“Forward Purchase Shares”), for $10.00 per share, or an aggregate amount of up to

$50,000,000, in a private placement that will close concurrently with the closing of our initial business combination, subject to approval

by the Kingstown investment committee.

We have the right, in our sole discretion, to reduce the amount of Forward Purchase Shares that

Kingstown may purchase pursuant to the FPA.

We have not considered the effect of the Forward Purchase Shares in the calculation of diluted

income per share, since their issuance is contingent upon future events.

We evaluated the FPA under ASC 480 and ASC 815-40

4 unchanged sentences

However, as the issuance of Forward Purchase Shares is contingent on several factors, including

the consummation of the Initial Business Combination, approval by the Kingstown board of directors, and the Company’s discretion,

we will record the FPA when it becomes probable that the triggering events will occur.

Until such time, due to the contingent nature of

the FPA, we will disclose the contingency in the notes to our financial statements.

do not believe that inflation had a material impact on our business, revenues or operating results during the period presented.

Growth Company Status

are an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart our

Business Startups Act of 2012, (the “ JOBS Act ”), and may take advantage of certain exemptions from various reporting

requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not

being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure

obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding

a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.

Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial

accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective

or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting

The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements

that apply to non-emerging growth companies but any such election to opt out is irrevocable.

We have elected not to opt out

of such extended transition period which means that when a standard is issued or revised and it has different application dates for public

or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies

the consummation of an initial business combination, approval by the Kingstown investment committee, and our discretion, we will record

the FPA when it becomes probable that the triggering events will occur.

Until such time, due to the contingent nature of the FPA, we will

disclose the contingency in the notes to our financial statements.

The FPA was terminated on November 30, 2022.

We do not believe that inflation had a material

impact on our business, revenues or operating results during the period presented.

Emerging Growth Company Status

We are an “emerging growth company,”

as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart our Business Startups Act of 2012, (the “JOBS

Act”), and may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies

that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements

of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports

and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder

approval of any golden parachute payments not previously approved.

Further, Section 102(b)(1) of the JOBS Act

exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies

(that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered

under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) are required to comply with the new or revised

financial accounting standards.

The JOBS Act provides that a company can elect to opt out of the extended transition period and comply

with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable.

We have elected

not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application

dates for public or private companies, we, as an emerging growth company, can adopt the new or revised standard at the time private companies

adopt the new or revised standard.

This may make comparison of our financial statements with another public company which is neither

an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible

This may make comparison of our financial statements with another public company which is either not

an emerging growth company or an emerging growth company which has opted out of using the extended transition period difficult or impossible

because of the potential differences in accounting standards used.

Quantitative and Qualitative Disclosures about Market Risk

are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information otherwise

required under this item.

Quantitative and Qualitative Disclosures

About Market Risk.

We are a smaller reporting company as defined

by Rule 12b-2 of the Exchange Act and are not required to provide the information otherwise required under this item.

Financial Statements and Supplementary

The financial statements required to be filed

pursuant to this Item 8 are appended to this Annual Report.

An index of those financial statements is found in Item 15 of Part IV of this

Annual Report.

Changes in and Disagreements with Accountants

on Accounting and Financial Disclosure.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis