Surf Air Mobility Inc. Files 10-Q for Period Ending March 31, 2024

TL;DR

<b>Surf Air Mobility Inc. filed its Q1 2024 10-Q, detailing financial instruments, debt, and equity agreements.</b>

AI Summary

SURF AIR MOBILITY INC. (SRFM) filed a Quarterly Report (10-Q) with the SEC on May 15, 2024. Surf Air Mobility Inc. filed a 10-Q report for the period ending March 31, 2024. The filing includes details on various financial instruments and agreements, such as convertible preferred stock, derivative liabilities, and purchase agreements with entities like GEM. Specific debt instruments mentioned include notes payable to Tecnam and a financing company with fixed interest rates and maturity dates in July/August 2032 and November 2024, respectively. The company also references share-based compensation awards, including performance-based restricted stock units. Fair value measurements for recurring items, particularly derivative liabilities, are detailed for both December 31, 2023, and March 31, 2024, with Level 3 inputs noted.

Why It Matters

For investors and stakeholders tracking SURF AIR MOBILITY INC., this filing contains several important signals. The filing provides a snapshot of the company's financial position and contractual obligations as of Q1 2024, including various debt instruments and equity-related items. Understanding these financial details is crucial for investors to assess the company's capital structure, potential liabilities, and ongoing financing activities.

Risk Assessment

Risk Level: medium — SURF AIR MOBILITY INC. shows moderate risk based on this filing. The company's financial disclosures indicate a complex web of debt and equity instruments, including convertible notes and purchase agreements, which could pose financial risks if not managed effectively.

Analyst Insight

Investors should closely examine the terms and conditions of the various debt and equity agreements detailed in the 10-Q to understand their potential impact on future financial performance and dilution.

Key Numbers

• 2024-03-31 — Reporting Period End Date (10-Q filing)
• 2024-05-15 — Filing Date (10-Q filing)
• July and August 2032 — Maturity Date (Note Payable to Tecnam)
• November 2024 — Maturity Date (Note Payable to Financing Company)
• April, June and September 2027 — Maturity Dates (Note Payable to Clarus Capital)

Key Players & Entities

• SURF AIR MOBILITY INC. (company) — Filer name
• PalantirTechnologiesIncMember (company) — Related entity
• Tecnam (company) — Note payable recipient
• GEM (company) — Party to purchase agreements
• Clarus Capital (company) — Note payable recipient
• Lamjam (company) — Related entity
• 7.60% (dollar_amount) — Fixed interest rate on note payable
• 6.75% (dollar_amount) — Fixed interest rate on note payable

FAQ

Risk Factors

• Derivative Liability Valuation [medium — financial]: The company's derivative liabilities are measured at fair value using Level 3 inputs, which are unobservable and can introduce significant estimation uncertainty.
• Convertible Debt and Warrants [medium — financial]: The presence of convertible preferred stock and warrants introduces potential dilution and complexity in the capital structure.
• Notes Payable Maturities [medium — financial]: Significant debt maturities in the near to medium term (e.g., November 2024, 2027, 2032) require careful cash flow management and potential refinancing.

Key Dates

• 2024-03-31: Quarterly Period End — Financial reporting period for the 10-Q
• 2024-05-15: Filing Date — Date the 10-Q was officially submitted to the SEC

Key Financial Figures

• $0.0001 — nge on which registered Common stock, $0.0001 par value per share SRFM New York S

Filing Documents

• srfm-20240331.htm (10-Q) — 1780KB
• srfm-ex31_1.htm (EX-31.1) — 12KB
• srfm-ex31_2.htm (EX-31.2) — 12KB
• srfm-ex32_1.htm (EX-32.1) — 6KB
• 0000950170-24-060529.txt (&nbsp;) — 10638KB
• srfm-20240331.xsd (EX-101.SCH) — 2293KB
• srfm-20240331_htm.xml (XML) — 1667KB

Financial Statements

Financial Statements 1 Unaudited Condensed Consolidated Balance Sheets 1 Unaudited Condensed Consolidated Statements of Operations 2 Unaudited Condensed Consolidated Statement of Changes in Redeemable Convertible Preferred Shares and Shareholders' Deficit 3 Unaudited Condensed Consolidated Statements of Cash Flows 4 Notes to Unaudited Condensed Consolidated Financial Statements 5 Item 2.

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

Management's Discussion and Analysis of Financial Condition and Results of Operations 26 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 33 Item 4.

Controls and Procedures

Controls and Procedures 34 PART II. OTHER INFORMATION 37 Item 1.

Legal Proceedings

Legal Proceedings 37 Item 1A.

Risk Factors

Risk Factors 37 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 37 Item 3. Defaults Upon Senior Securities 37 Item 4. Mine Safety Disclosures 37 Item 5. Other Information 37 Item 6. Exhibits 38

—FINANCIA L INFORMATION

PART I—FINANCIA L INFORMATION

Financi al Statements

Item 1. Financi al Statements. Surf Air Mobility Inc. Unaudited Condensed Con solidated Balance Sheets March 31, 2024 and December 31, 2023 (in thousands, except share and per share data) (Unaudited) March 31, 2024 December 31, 2023 Assets: Current assets: Cash $ 1,278 $ 1,720 Accounts receivable, net 4,710 4,965 Prepaid expenses and other current assets 10,725 11,051 Total current assets 16,713 17,736 Restricted cash 713 711 Property and equipment, net 46,706 45,991 Intangible assets, net 25,777 26,663 Operating lease right-of-use assets 12,263 12,818 Finance lease right-of-use assets 1,352 1,343 Other assets 5,262 5,727 Total assets $ 108,786 $ 110,989 Liabilities and Shareholders' Deficit: Current liabilities: Accounts payable $ 20,575 $ 18,854 Accrued expenses and other current liabilities 72,233 59,582 Deferred revenue 18,122 19,011 Current maturities of long-term debt 5,080 5,177 Operating lease liabilities, current 4,837 4,104 Finance lease liabilities, current 249 215 SAFE notes at fair value, current 14 25 Convertible notes at fair value, current 7,852 7,715 Due to related parties, current 36,508 25,431 Total current liabilities 165,470 140,114 Long-term debt, net of current maturities 19,985 20,617 Operating lease liabilities, long term 4,666 5,507 Finance lease liabilities, long term 1,143 1,137 Due to related parties, long term 1,288 1,673 Other long-term liabilities 22,535 19,426 Total liabilities $ 215,087 $ 188,474 Commitments and contingencies (Note 12) Shareholders' equity (deficit): Common shares, $ 0.0001 par value; 800,000,000 shares authorized as of both March 31, 2024 and December 31, 2023; 81,917,187 shares issued and outstanding as of March 31, 2024 and 76,150,437 shares issued and outstanding as of December 31, 2023 $ 8 $ 8 Addit

View Full Filing

View this 10-Q filing on SEC EDGAR