Tevogen Bio Holdings Inc. (TVGN)

Item
7. 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 together with our audited consolidated
financial statements and related notes included elsewhere in this Annual Report. This discussion and other parts of this Annual Report
contain forward-looking statements that involve risk and uncertainties, such as statements of our plans, objectives, expectations and
intentions. As a result of many factors, including those factors set forth in the “Risk Factors” section of this Annual Report,
our actual results could differ materially from the results described in or implied by the forward-looking statements contained in the
following discussion and analysis.

References to the “Company,”
“we,” “us,” and “our” in this section generally refer to Tevogen Bio Inc before the Business Combination
and to Tevogen Bio Holdings Inc. and its subsidiary collectively from and after the Business Combination, unless the context otherwise
requires.

Overview

We are a clinical-stage specialty
immunotherapy company harnessing one of nature’s most powerful immunological weapons, CD8+ CTLs, to develop off-the-shelf, precision
T cell therapies for the treatment of infectious diseases, cancers, and other disorders, with the aim of addressing the significant unmet
needs of large patient populations. We believe the full potential of T cell therapies remains largely untapped, and aspire to be the first
biotechnology company offering commercially attractive, economically viable, and cost-effective personalized T cell therapies.

We believe our allogeneic, precision
T cell technology, ExacTcellTM, has the potential to mainstream cell therapy with a new class of off-the-shelf T cell therapies
with diverse applications across virology, oncology, and other areas. ExacTcell is a set of processes and methodologies to develop, enrich,
and expand single human HLA restricted CTL therapies with proactively selected, precisely defined targets. We are focused on using ExacTcell
to develop therapeutics that are intended to be infused in patients other than the original donor. ExacTcell is designed to maximize
the immunologic specificity of our products in order to eliminate malignant and virally infected cells while allowing healthy cells to
remain intact. In addition, through our Tevogen.AI artificial intelligence initiative, we are exploring ways to deploy artificial intelligence-powered
target detection to further accelerate our product development pace.

The first clinical product of
ExacTcell, TVGN 489, is initially being developed to fill a critical gap in COVID-19 therapeutics for the immunocompromised and the high-risk
elderly, with potential applications in both treatment and prevention of Long COVID. We have completed a Phase 1 proof-of-concept clinical
trial of TVGN 489 for the treatment of ambulatory, high-risk adult COVID-19 patients. No dose-limiting toxicities or significant treatment-related
adverse events were observed in the treatment arm of the trial. Secondary endpoints showing a rapid reduction of viral load and that infusion
of TVGN 489 did not prevent development of the patients’ own T cell-related (cellular) or antibody-related (humoral) anti-COVID-19
immunity were also met. None of the patients who participated in the trial reported progression of infection, reinfection, or the development
of Long COVID during the six-month follow-up period.

Our commercial success depends
in part on our ability to obtain and maintain patent and other protection for our products and methods, preserve the confidentiality of
our trade secrets, operate without infringing, misappropriating, or otherwise violating the valid, enforceable proprietary rights of others,
and prevent others from infringing, misappropriating, or otherwise violating our proprietary rights. We rely on a combination of patents,
patent applications, trademarks, and trade secrets to establish and protect our intellectual property rights. Our ability to stop third
parties from making, using, selling, offering to sell, or importing our products without the right to do so may depend on the extent to
which we have rights under valid and enforceable patents, trademarks or trade secrets that cover these activities.

As our patents were developed
internally, historical expenditures related to their development were all expensed as incurred per GAAP. We believe these patents have
significant value as the basis of our product pipeline. Our continued investment in our pipeline highlights our belief in future commercial
viability of these products.

On February 14, 2024
(the “Closing Date”), pursuant to the agreement and plan of merger dated June 28, 2023 (the “Merger Agreement”)
by and among Semper Paratus, Semper Merger Sub, Inc., a wholly owned subsidiary of Semper Paratus (“Merger Sub”), SSVK Associates,
LLC, Tevogen Bio, and Dr. Ryan Saadi, in his capacity as seller representative, Merger Sub merged with and into Tevogen Bio, with Tevogen
Bio being the surviving company and a wholly owned subsidiary of Semper Paratus (the “Merger,” and together with the other
transactions contemplated by the Merger Agreement, the “Business Combination”) and Semper Paratus was renamed Tevogen Bio
Holdings Inc. (the “Closing”). See Note 4 to our consolidated financial statements in this Annual Report for additional information
regarding the net assets acquired through the Merger. The Merger was accounted for as a reverse recapitalization under GAAP because the
Company was determined to be the accounting acquirer.

Since commencing operations
in June 2020, we have devoted substantially all our efforts and financial resources to establishing corporate governance, recruiting essential
staff, establishing research and development capability including securing laboratory space and equipment, conducting scientific research,
securing intellectual property rights to our inventions related to our product candidates and ExacTcell, carrying out drug discovery including
pre-clinical studies and our Phase 1 clinical trial of TVGN 489, raising capital, and pursuing the Business Combination.

To date, we have not
generated any revenue. Our net loss for the years ended December 31, 2024 and 2023 was $13.7 million and $60.5 million, respectively.
Net loss for the year ended December 31, 2024 was primarily attributable to a $53.6 million loss from operations that primarily resulted
from non-cash, stock-based compensation expense recognized with the liquidity event condition contained in certain stock awards was satisfied
upon the closing of the Business Combination as well as $7.5 million in transaction costs in connection with the Business Combination,
partially offset by the change in fair value of convertible promissory notes of $48.5 million. As of December 31, 2024, we had cash of
$1.3 million.

On February 14, 2024,
we entered into a securities purchase agreement with The Patel Family, LLP (the “Patel Family”) pursuant to which the Patel
Family purchased 500 shares of our Series A Preferred Stock for an aggregate purchase price of $2.0 million. On March 27, 2024, we entered
into an Amended and Restated Securities Purchase Agreement with the Patel Family pursuant to which we amended and restated the original
agreement and the Patel Family agreed to purchase 600 shares of our Series A-1 Preferred Stock for an aggregate purchase price of $6.0
million, of which $3.0 million has been received through the date of this Annual Report. On August 21, 2024, we entered into a securities
purchase agreement with the Patel Family, pursuant to which the investor purchased 600 shares of our Series C Preferred Stock for an aggregate
purchase price of $6.0 million.

As described in more
detail in “—Liquidity and Capital Resources—Funding Requirements” below, on June 6, 2024, we entered into
a Loan Agreement (the “Loan Agreement”) with the Patel Family providing for (i) an unsecured line of credit facility (the
“Facility”), pursuant to which the Patel Family agreed to lend us up to an initial amount of $36.0 million (the “Maximum
Loan Amount”) of term loans in $1.0 million increments on a monthly basis, over a draw period of thirty-six months, and (ii) a contingent
option for the Patel Family to purchase at least $14.0 million of our Common Stock in a future private placement (the “Optional
PIPE”). The Loan Agreement also contains a contingent option for the Patel Family to purchase at least $14.0 million of our Common
Stock plus up to the then-remaining available amount under the Facility, in a future private placement if the ten-day trailing volume
weighted average price per share of the Common Stock (the “Trailing VWAP”) reaches $10.00 per share. Pursuant to the terms
of the Loan Agreement, we also issued to the Patel Family 1,000,000 shares of Common Stock as a commitment fee (the “Commitment
Shares”), subject to forfeiture by the Patel Family of the Commitment Shares or an equal number of shares of Common Stock in the
event the Patel Family fails to (i) make a deposit under the Facility when due or (ii) pay the purchase price for the Optional PIPE within
30 days after the Threshold Price Notice Date (as defined in the Loan Agreement) in the event we have satisfied all applicable closing
conditions.

In addition, in January
2025, we received a grant of $2.0 million from KRHP to further our development
of off-the-shelf, genetically unmodified precision T cell therapeutics to treat infectious diseases and cancers. KRHP is affiliated with
the Patel Family.

Based on cash
on hand as of the date of this Annual Report of approximately $1.3 million, the amounts available under our Loan Agreement, and the
$8.0 million of additional committed grant funding from KRHP, we have concluded that we have sufficient cash to fund our operations
for at least the next 12 months from the issuance date of our consolidated financial statements.

We do not expect to generate
product revenue unless and until we obtain marketing approval or other authorization for and successfully commercialize TVGN 489 or another
product candidate. We expect to incur expenses related to expanding our research and development capability, building our manufacturing
infrastructure including through acquisitions, and developing our commercialization organization, including reimbursement, marketing,
managed market, and distribution functions, and training and deploying a specialty medical science liaison team.

Components of our Results of Operations

Revenue

To date, we have not generated
any revenue, and we do not expect to generate any revenue from the sale of products unless and until we obtain marketing approval or other
authorization for and commercialize TVGN 489 or another product candidate.

Operating Expenses

Research and Development Expenses

Research and development expenses
consist primarily of costs incurred for our research activities, including staffing, discovery efforts, preclinical studies, and clinical
development of TVGN 489, and preclinical studies of other product candidates, and include:

Research and development activities
are central to the biotechnology business model. Product candidates in later stages of clinical development generally have higher development
costs than those in earlier stages, primarily due to the increased study sizes, which also leads generally to longer patient enrollment
times in later-stage clinical trials. We expect our research and development expenses to increase significantly over the next several
years as we increase manufacturing, shipping, and storage of clinical batches required for clinical trials, incur increased personnel
costs, including stock-based compensation, conduct planned clinical trials for TVGN 489 and other clinical and pre-clinical activities
for other product candidates, and prepare regulatory filings for any of our product candidates.

The successful development of
our current or future product candidates is highly uncertain. At this time, we cannot reasonably estimate or know the nature, timing,
and costs of the efforts that will be necessary to complete the development of any product candidates. The success of TVGN 489 and our
other product candidates will depend on several factors, including the following:

A change in the outcome of any
of these variables concerning the development, manufacturing, or commercialization activities of a product candidate could result in a
significant change in the costs and timing associated with the development of that product candidate. For example, if we are required
to conduct additional clinical trials or other testing of our product candidates beyond those that we currently contemplate, if we are
unable to successfully complete clinical trials of our product candidates or other testing, if the results of these trials or tests are
not positive or are only modestly positive, if there are safety concerns, or if we determine that the observed safety or efficacy profile
would not be competitive in the marketplace, we could be required to expend significant additional financial resources and time on the
completion of clinical development. We anticipate that product commercialization may take several years, and we expect to spend a significant
amount in development costs.

General and Administrative Expenses

General and administrative expenses
primarily consist of personnel expenses, which include salaries, benefits, and stock-based long term incentive compensation for employees.
These expenses also encompass corporate facility costs such as rent, utilities, depreciation, and maintenance, as well as costs not classified
under research and development expenses. Legal fees pertaining to intellectual property and corporate matters, as well as fees for accounting
and consulting services, are also included in general and administrative expenses.

We expect that our general and
administrative expenses will increase in the future to support our continued research and development activities, potential commercialization
efforts, and increased costs of operating as a public company. These increases will likely include increased costs related to the hiring
of additional personnel and fees to outside consultants, lawyers, accountants, and recruitment firms, among other expenses. Increased
costs associated with being a public company will also include expenses related to services associated with maintaining compliance with
SEC and Nasdaq requirements, insurance, and investor relations costs. If any of our current or future product candidates obtains marketing
approval, we expect that we would incur significantly increased expenses associated with sales and marketing efforts.

Interest Expense, Net

Interest expense, net consists
primarily of interest on our former convertible promissory notes and Loan Agreement, partially offset by interest earned on bank deposits.
(See “—Liquidity and Capital Resources—Sources of Liquidity” below.)

Merger Transaction Costs

Transaction costs we incurred in relation
to the Business Combination were initially capitalized as deferred transaction costs up through the Closing Date, at which time such costs
were charged to expense in our statements of operations less the amount of cash received in the Business Combination.

Change in Fair Value of Convertible Promissory Notes

U.S. accounting standards provide
entities with an option to measure many financial instruments and certain other items at fair value. As a result of us electing this option,
we recorded all convertible promissory notes at fair value with changes in fair value reported in our statements of operations at each
balance sheet date through the settlement of the convertible promissory notes in connection with the Closing, at which time the convertible
promissory notes were converted into our Common Stock.

Loss on Issuance of Commitment Shares

Our other expenses consist
of losses on the issuance of the Commitment Shares for the year ended December 31, 2024 associated with the Loan Agreement. Since we intend
to elect the fair value option for future draws under the Loan Agreement, we expense all issuance costs associated with the Loan Agreement,
which are comprised of the fair value of the Commitment Shares as well as the issuance date fair value of the $14 million Purchase Option
and Additional Amount Purchase Option. For more information about the Loan Agreement, see “—Liquidity and Capital Resources—Funding
Requirements” below.

Income Tax Provision

Since inception, we have incurred
significant net losses. As of December 31, 2024, we had net operating loss carryforwards (“NOLs”) for federal and state income
tax purposes of $25.6 million and $27.8 million, respectively. We have provided a valuation allowance against the full amount of our net
deferred tax assets since, in the opinion of our management, based upon our historical and anticipated future losses, it is more likely
than not that the benefits will not be realized.

Our utilization of our NOLs may
be subject to a substantial annual limitation in the event of certain cumulative changes in the ownership interest of significant stockholders
over a three-year period in excess of 50%, as defined under Sections 382 and 383 of the Internal Revenue Code of 1986, as amended, respectively,
as well as similar state provisions.

Results of Operations

Comparison of the years ended December 31, 2024
and 2023

The following table summarizes
our results of operations for the years ended December 31, 2024 and 2023:

Research and Development Expenses

We do not track our internal
research and development costs on a program-by-program basis. The following table summarizes our research and development expenses for
the years ended December 31, 2024 and 2023:

Research and development expenses
for the year ended December 31, 2024 were $31.0 million, compared to $4.4 million for the year ended December 31, 2024. The increase was
primarily attributable to an increase in stock-based compensation due to stock compensation expense related to the restricted stock units
(“RSUs”) granted to Dr. Saadi on the Closing Date.

General and Administrative Expenses

The following table summarizes
our general and administrative expenses for the years ended December 31, 2024 and 2023:

General and administrative expenses
for the year ended December 31, 2024 were $22.5 million compared to $4.4 million for the year ended December 31, 2023. The increase was
primarily attributable to stock-based compensation expense of $13.8 million, of which $7.7 million was recognized as a non-cash stock-based
compensation expense from certain stock-based awards that continue to vest through satisfaction of service conditions subsequent to the
satisfaction of the liquidity condition upon the Closing, and $2.3 million was recognized as restricted stock compensation expense related
to the RSUs granted. The increase of $0.6 million in personnel costs was primarily attributable to an increase in headcount and an increase
in premium for our director and officer insurance policy. The increase of $4.0 million in legal and professional fees was primarily attributable
to the additional services incurred as a result of the Merger.

Interest Expense, Net

We recognized $0.2 million and
$1.2 million in interest expense for the years ended December 31, 2024 and 2023, respectively, which was attributable primarily to the
outstanding principal balance associated with our convertible promissory notes that converted into Common Stock in connection with the
Closing.

Merger Transaction Costs

Merger transaction costs in excess of cash
received from the Business Combination of $7.5 million were recognized as period expenses for the year ended December 31, 2024.

Change in Fair Value of Convertible Promissory
Notes

We recognized a non-cash gain
of $48.5 million and a non-cash loss of $50.4 million for the change in fair value of the convertible promissory notes for the years ended
December 31, 2024 and 2023, respectively. The change was primarily a result of the increase in the underlying estimated fair value of
our Common Stock during the year ended December 31, 2023 compared to a decrease in the underlying estimated fair value of our Common Stock
from January 1, 2024 to the settlement of the convertible promissory notes upon the Closing.

Loss on Issuance of Commitment Shares

We incurred losses on the issuance
of Commitment Shares during the year ended December 31, 2024, associated with the Loan Agreement.

Liquidity and Capital Resources

Sources of Liquidity

As of December 31, 2024, we had
$1.3 million in cash, as compared to $1.1 million in cash as of December 31, 2023. To date, we have not yet commercialized any products
or generated any revenue from product sales and have financed our operations primarily with proceeds from the sale of convertible promissory
notes and preferred stock, funds drawn on the Loan Agreement, and grant funding. Since January 2021, we have raised aggregate gross proceeds
of $24.0 million from the sale of convertible promissory notes, $2.0 million from the sale of our Series A Preferred Stock, $3.0 million
from deposits related to the future sale of our Series A-1 Preferred Stock, and $6.0 million from the sale of our Series C Preferred Stock.
In June 2024, we entered into the Loan Agreement, which provided up to $36.0 million of term loans that can be drawn in $1.0 million increments
each month over thirty-six months, as described below. As of December 31, 2024, we had drawn $1.0 million with a remaining $30.0 million available
for future financing over the remaining 30 months. We drew an additional $1.0 million on February 10, 2025. In addition, in
January 2025, we received a grant of $2.0 million from KRHP. We expect to receive an additional $8.0 million grant from KRHP during the second quarter of 2025.

Cash Flows

The following table summarizes
our cash flows for the years ended December 31, 2024 and 2023:

Cash Flows from Operating Activities

During the year ended December
31, 2024, we used $12.0 million of net cash in operating activities. Cash used in operating activities reflected our net loss of $13.7
million offset by $1.7 million of non-cash charges related to the change in the fair value of the convertible promissory notes, depreciation
expense, reductions in the operating right of use (“ROU”) assets, non-cash interest on the convertible promissory notes, and
the net change in our operating assets and liabilities attributable to the timing of our payments to our vendors for research and development
activities.

During the year ended December
31, 2023, we used $8.2 million of net cash in operating activities. Cash used in operating activities reflected our net loss of $60.5
million offset by $52.0 million of non-cash charges related to the change in the fair value of the convertible promissory notes, depreciation
expense, reductions in the ROU assets, non-cash interest on the convertible promissory notes, and a $0.3 million net change in our operating
assets and liabilities attributable to the timing of our payments to our vendors for research and development activities.

Cash Flows from Investing Activities

During the years ended December
31, 2024 and 2023, we used $0.0 million and $0.1 million respectively, for the purchase of property and equipment.

Cash Flows from Financing Activities

During the year ended December
31, 2024, we received $12.3 million of net cash from financing activities attributable to $2.0 million in proceeds from the sale of Series
A Preferred Stock, $6.0 million in proceeds from the sale of Series C Preferred Stock, $3.0 million of non-refundable prepaid proceeds
towards the anticipated issuance of Series A-1 Preferred Stock, $1.0 million drawn under the Loan Agreement, and $0.2 million of cash
in connection with the Merger.

During the year ended December
31, 2023, we received $4.0 million of net cash from financing activities attributable to the proceeds from the convertible promissory
notes, less $0.1 million related to payments of deferred transaction costs.

Funding Requirements

Our primary
sources of funds to meet our near-term liquidity and capital requirements include cash on hand, including the funding we have
received from the sale of our Series A and Series C Preferred Stock and the funding we expect to receive from the sale of our Series
A-1 Preferred Stock, our access to an unsecured line of credit (limited to a $1.0 million monthly draw) under the Loan Agreement
described below, and the $8.0 million of grant funding that KRHP has committed to provide to be used towards the Company’s
ongoing operational expenses. On February 14, 2024, we entered into a securities
purchase agreement with an investor pursuant to which the investor agreed to purchase shares of our Series A Preferred Stock for an
aggregate purchase price of $8.0 million. On March 27, 2024, we entered into an agreement pursuant to which that amount was reduced
to $2.0 million and the investor agreed to purchase shares of our Series A-1 Preferred Stock for an aggregate purchase price of $6.0
million. We have not yet received $3.0 million of the $6.0 million purchase price for the Series A-1 Preferred Stock. Even if we
receive such proceeds, we will still need additional capital to fully implement our business, operating, and development plans. On
August 21, 2024, we entered into a securities purchase agreement with an investor pursuant to which the investor agreed to purchase
shares of our Series C Preferred Stock for an aggregate purchase price of $6.0 million.

On June 6, 2024, we entered into
the Loan Agreement, pursuant to which the Patel Family agreed to provide to us up to the Maximum Loan Amount of $36.0 million under the Facility.
The Patel Family is also the investor in our Series A, Series A-1, and Series C Preferred Stock. The Facility permits us to borrow up to $1.0
million monthly in a single monthly draw over a period of up to three years. Draws accrue interest at a fixed annual rate of the lower
of (i) the daily secured overnight financing rate, measured on the date we receive the draw (the “Deposit Date”), plus 2.00%
and (ii) 7.00%, accruing quarterly beginning on the Deposit Date and payable quarterly beginning on the three-month anniversary of the
Deposit Date. Interest will be payable in shares of Common Stock with an effective purchase price of $1.50 per share, and each draw will
mature 48 months after the Deposit Date. Prepayment will be permitted without penalty. We may repay or prepay any amount of outstanding
principal balance under the Facility at our election in cash or in shares of Common Stock with an effective purchase price of the greater
of $1.50 per share and the 10-day trailing volume weighted average price of the Common Stock (the “Trailing VWAP”) as of the
trading day prior to payment, subject to certain requirements related to resale registration. Pursuant to the Loan Agreement, we also
agreed to provide the Patel Family an option to purchase $14.0 million of shares of our Common
Stock plus an additional amount up to the total then-remaining available and undrawn portion of the Maximum Loan Amount (which amount
would thereafter no longer be available under the Facility). The Optional PIPE would be priced at a 30% discount to the Trailing VWAP
on the date such price first reaches at least $10.00 per share (the “Threshold Price Date”) and will be exercisable by the
Patel Family by written notice within three business days after we have notified the Patel Family of the Threshold Price Date (the date
of such notice, the “Threshold Price Notice Date”). Pursuant to the terms of the Loan Agreement, we issued to the Patel Family
the Commitment Shares, subject to forfeiture by the Patel Family of the Commitment Shares or an equal number of shares of Common Stock
in the event the Patel Family fails to (i) make a deposit under the Facility when due or (ii) pay the purchase price for the Optional
PIPE within 30 days after the Threshold Price Notice Date in the event we have satisfied all applicable closing conditions. There is no
assurance as to the amount of proceeds we will ultimately receive under the Loan Agreement. As of December 31, 2024, we have drawn an
aggregate of $1.0 million under the Loan Agreement.

We expect to devote considerable
financial resources to our ongoing and planned activities, particularly as we conduct our planned clinical trials of TVGN 489 and other
product candidates.

Identifying potential
product candidates and conducting pre-clinical testing and clinical trials is a time-consuming, expensive, and uncertain process that
takes years to complete, and we may never generate the necessary data or results required to obtain marketing approval and achieve product
sales. In addition, our product candidates, if approved, may not achieve commercial success.

We expect our expenses
to increase in connection with our ongoing activities, particularly as we advance our pre-clinical studies and clinical trials. In addition,
if we obtain marketing approval for TVGN 489 in any indication or for any other product candidate we are developing or develop in the
future, we expect to incur commercialization expenses related to product manufacturing, sales, marketing, and distribution. Furthermore,
we expect to continue to incur increased costs associated with operating as a public company. Accordingly, we will need additional funding
to fully implement our business plans.

Our future capital requirements
will depend on many factors, including:

As of December 31, 2024, we had
cash of $1.3 million. We believe that our cash balance and amounts available under the Loan Agreement, which allows us to draw down term
loans of $1.0 million per month over thirty-six months, will allow us to have adequate cash and financial resources, to operate for at
least the next 12 months from the date of issuance of our consolidated financial statements included in this Annual Report. In addition, KRHP has committed to provide an additional $8.0 million of
grant funding to the Company to be used towards the Company’s ongoing operational expenses. The grant funding will be used to satisfy
the Company’s obligations as they come due through March 31, 2026. The Company does not plan to initiate a clinical trial until
additional funding is received.

We regularly evaluate different
strategies to obtain funding for operations for subsequent periods. These strategies may include but are not limited to private placements
of securities, licensing and/or marketing arrangements, partnerships with other pharmaceutical or biotechnology companies, and public
offerings of securities. We may not be able to obtain financing on acceptable terms and may not be able to enter into strategic alliances
or other arrangements on favorable terms. The terms of any financing may adversely affect the holdings or the rights of our stockholders.
If we are unable to obtain sufficient funding, we could be required to delay, reduce or eliminate research and development programs, product
portfolio expansion, or future commercialization efforts, which could adversely affect our business prospects.

Contractual Obligations and Commitments

The following table summarizes
our contractual obligations and commitments as of December 31, 2024:

The commitment amounts in the
table above are associated with contracts that are enforceable and legally binding and that specify all significant terms, including fixed
or minimum services to be used, fixed, minimum, or variable price provisions, and the approximate timing of the actions under the contracts.
Our contracts with CROs, CMOs, and other third parties for the manufacture of our product candidates and to support pre-clinical research
studies and clinical testing are generally cancelable by us upon prior notice and do not contain any minimum purchase commitments. Payments
due upon cancellation consisting only of payments for services provided or expenses incurred, including noncancelable obligations of our
service providers, up to the date of cancellation are not included in the table above as the amount and timing of such payments are not
known.

Critical Accounting Policies and Estimates

This discussion and analysis
of our financial condition and results of operations is based on our consolidated financial statements, which have been prepared in accordance
with GAAP. The preparation of the consolidated financial statements requires us to make estimates and judgments that affect the reported
amounts of assets, liabilities, and expenses and the disclosure of contingent assets and liabilities in our consolidated financial statements.
On an ongoing basis, we evaluate our estimates and judgments, including those related to accrued expenses, the fair value of our Common
Stock, the fair value of our convertible promissory notes, and stock-based compensation. We base our estimates on historical experience,
known trends and events, and various other factors that are believed to be reasonable under the circumstances, the results of which form
the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual
results may differ from these estimates under different assumptions or conditions, including those factors set out in the “Risk
Factors” section and elsewhere in this Annual Report, including the section entitled “Special Note Regarding Forward-Looking
Statements.”

While our significant accounting
policies are described in more detail in Note 3 to our consolidated financial statements, we believe the following accounting policies
are the most critical to the judgments and estimates used in the preparation of our consolidated financial statements or involve a significant
level of estimation uncertainty and have had or are reasonably likely to have a material impact on our financial condition or results
of operation.

Research and Development Expenses

Research and development activities
are expensed as incurred. As part of the process of preparing our consolidated financial statements, we are required to estimate our accrued
research and development expenses, including those related to clinical trials and product candidate manufacturing. This process involves
reviewing open contracts and purchase orders, communicating with our applicable personnel to identify services that have been performed
on our behalf and estimating the level of service performed and the associated cost incurred for the services when we have not yet been
invoiced or otherwise notified of actual costs. Our service providers invoice us in arrears or require prepayments for services performed,
as well as on a pre-determined schedule or when contractual milestones are met. We make estimates of our accrued expenses as of each balance
sheet date in the consolidated financial statements based on facts and circumstances known to us at that time. We periodically confirm
the accuracy of the estimates with the service providers and make adjustments if necessary. Examples of estimated accrued research and
development expenses include fees paid to:

Costs for clinical trials and
manufacturing activities are recognized based on an evaluation of our vendors’ progress towards completion of specific tasks, using
data such as participant enrollment, clinical site activations, or information provided to us by our vendors regarding their actual costs
incurred. Payments for these activities are based on the terms of individual contracts and payment timing may differ significantly from
the period in which the services were performed. We determine accrual estimates through reports from and discussions with applicable personnel
and outside service providers as to the progress or state of completion of studies, or the services completed. Our estimates of accrued
expenses as of each balance sheet date are based on the facts and circumstances known at the time. Costs that are paid in advance of performance
are deferred as a prepaid expense and amortized over the service period as the services are provided.

Although we do not expect our
estimates to be materially different from amounts actually incurred, our understanding of the status and timing of services performed
relative to the actual status and timing of services performed may vary and may result in reporting amounts that are too high or too low
in any particular period. To date, there have not been any material adjustments to our prior estimates of accrued research and development
expenses. However, due to the nature of estimates, we cannot assure you that we will not make changes to our estimates in the future as
we become aware of additional information about the status or conduct of our clinical trials and other research activities.

Fair Value Measurements

Our recurring fair value measurements primarily
consist of the convertible promissory notes prior to the Merger, for which we elected the fair value option, the freestanding $14 million
purchase option under the Loan Agreement, and the bifurcated purchase option that is embedded within the loan commitment under the Loan
Agreement.

We used the Probability Weighted Expected
Return Method (“PWERM”) valuation methodology to determine the fair value of the convertible promissory notes prior to the
Merger for all the periods presented. The PWERM is a scenario-based methodology that estimates the fair value based upon an analysis of
future values for the company, assuming various outcomes. The value is based on the probability-weighted present value of expected future
investment returns considering each of the possible outcomes available. The future value under each outcome is discounted back to the
valuation date at an appropriate risk-adjusted discount rate and probability weighted to arrive at an indication of value. Significant
assumptions used in determining the fair value of convertible promissory notes include volatility, discount rate, and probability of a
future liquidity event. In February 2024, concurrent with the Merger, we converted our outstanding convertible promissory notes into 10,337,419
shares of Common Stock.

We used a Monte Carlo Simulation (“MCS”)
valuation methodology to determine the fair value of the freestanding $14 million purchase option and embedded purchase option associated
with the Loan Agreement at inception and as of December 31, 2024. The MCS methodology simulates our future stock price to estimate if
and when the Trailing VWAP will reach $10.00 per share, and discounts the resulting payoff back to each valuation date using a present
value factor. Significant assumptions used in determining the fair value of these options include volatility and discount rate.

Stock-Based Compensation

Awards under our compensation
plans are accounted for in accordance with Accounting Standards Codification 718, Compensation – Stock Compensation. Compensation
cost is measured at the grant date fair value of the award and is recognized over the vesting period of the award. We use the straight-line
method to record compensation expense of awards with service-based vesting conditions. We account for forfeitures of stock-based awards
as they occur. We recognize share-based compensation expense for awards with performance conditions when it is probable that the condition
will be met, and the award will vest. Prior to the Merger, we estimated the fair value of our Common Stock in accordance with the guidance
outlined in the American Institute of Certified Public Accountants’ Accounting and Valuation Guide, Valuation of Privately-Held-Company
Equity Securities Issued as Compensation.

Recent Accounting Pronouncements

See Note 3 to our consolidated
financial statements found in this Annual Report for a description of recent accounting pronouncements applicable to our financial statements.

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

The
following discussion and analysis of our financial condition and results of operations should be read in conjunction with our financial
statements and the related notes included elsewhere in this Annual Report. Some of the information contained in this discussion and analysis
or set forth elsewhere in this Annual Report, including information with respect to our plans, objectives, expectations, projections,
and strategy for its business and related financing, includes forward-looking statements that involve risks and uncertainties. As a result
of many factors, including those factors set out in the “Risk Factors” section of this Annual Report, our actual results
could differ materially from the results described in or implied by these forward-looking statements. See also the section titled “Cautionary
Note Regarding Forward-Looking Statements” in this Annual Report.

Unless
otherwise indicated or as the context requires, the historical financial information included or discussed in this Management’s
Discussion and Analysis of Financial Condition and Results of Operations is that of Semper Paratus Acquisition Corporation prior to the
Business Combination because the Business Combination was consummated after the period covered by the financial statements included in
this Annual Report. In addition, accordingly, unless otherwise indicated or the context requires, historical references to the “Company,”
“we,” “us,” and “our” in this section also generally refer to Semper Paratus Acquisition Corporation
prior to the closing of the Business Combination.

Overview

We
are a clinical-stage specialty immunotherapy company harnessing one of nature’s most powerful immunological weapons, CD8+ cytotoxic
T lymphocytes (“CD8+ CTLs”), to develop off-the-shelf, precision T cell therapies for the treatment of infectious diseases,
cancers, and neurological disorders with the aim of addressing the significant unmet needs of large patient populations. We believe that
sustainability and commercial success in the forthcoming era of medicine will rely on ensuring patient accessibility through advanced
science and innovative business models. We aspire to be the first biotechnology company offering commercially attractive, economically
viable, and cost-effective personalized T cell therapies.

We
believe our allogeneic, precision T cell technology platform, ExacTcell, represents a significant scientific breakthrough that has the
potential to produce a new class of off the shelf – manufactured and stored for immediate use – drugs with diverse applications
spanning virology, oncology, and neurology. ExacTcell is a set of processes and methodologies to develop, enrich, and expand single HLA
restricted CTL therapies with proactively selected, precisely defined targets. HLA molecules are proteins that play an important role
in the immune system’s ability to recognize “self” versus “foreign.” CTLs, also known as killer T cells,
are white blood cells that are part of the immune system and destroy infected, malignant, or otherwise damaged cells. We are focused
on using ExacTcell to develop allogeneic therapeutics, meaning therapeutics that are intended to be infused in patients other than the
original donor. ExacTcell therapies are based on carefully selected, naturally occurring CTLs that recognize targets of interest from
the body’s native T cell receptor pool, unlike genetically engineered T cell therapies. Our confidence in ExacTcell is reflected
in our development pipeline, which has been carefully tailored to address the unmet needs of large patient populations grappling with
life-threatening viral diseases, both viral and non-viral induced cancers, and neurological disorders such as multiple sclerosis.

The
first clinical product of ExacTcell, TVGN 489, is being developed to fill a critical gap in COVID-19 therapeutics for the immunocompromised
and the high-risk elderly, with potential applications in both treatment and prevention of Long COVID. TVGN 489 consists of CTLs active
against multiple precise, well defined, and well characterized targets across the SARS-CoV-2 genome. We hope to launch a pivotal trial
of TVGN 489 in COVID-19 patients with B cell malignancies in as soon as late 2024, with studies of other highly vulnerable populations
thereafter. TVGN 489 is also in preclinical development for treatment and prevention of Long COVID.

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To
date, we have not generated any revenue. As a result, we have never been profitable and have incurred net losses since the commencement
of our operations. We do not expect to generate product revenue unless and until we obtain marketing approval for and successfully commercialize
TVGN 489 or another product candidate, and we cannot assure you that we will ever generate significant revenue or profits. We expect
to incur significant expenses related to expanding our research and development capability, building our manufacturing infrastructure
including through acquisition, and our commercialization organization, including reimbursement, marketing, managed market, distribution
functions, and training, and deploying a specialty medical science liaison team.

Semper
Paratus Acquisition Corporation

We
were incorporated as a Cayman Islands exempted company on April 21, 2021. We were formed for the purpose of entering into a merger, share
exchange, asset acquisition, stock purchase, reorganization or other similar business transaction with one or more businesses (an “Initial
Business Combination”).

On
November 8, 2021, we consummated the initial public offering (the “IPO”) of 30,000,000 units (“Units”) with respect
to the ordinary shares included in the Units being offered (the “Public Shares”) at $10.00 per Unit generating gross proceeds
of $300,000,000. Simultaneously with the closing of the IPO, we consummated the sale of 1,360,000 private placement units (“Private
Placement Units”) at a price of $10.00 per Private Placement Unit in a private placement to our sponsor, Semper Paratus Sponsor
LLC (the “Original Sponsor”) and underwriter Cantor Fitzgerald & Co. (“Cantor”), generating gross proceeds
of $13,600,000. Simultaneously with the closing of the IPO, we consummated the closing of the sale of 4,500,000 additional Units upon
receiving notice of the underwriter’s election to fully exercise its overallotment option (“Overallotment Units”),
generating additional gross proceeds of $45,000,000, and the private placement of an additional 90,000 Private Placement Units to the
Original Sponsor, generating gross proceeds of $900,000. Following the closing of the IPO, $351,900,000 from the net proceeds of the
sale of the Units in the IPO and the Private Placement Units was placed in a trust account (the “Trust Account”) for investment
in U.S. government securities with a maturity of 180 days or less or in any open-ended investment company that holds itself as a money
market fund until the earlier of the completion of an Initial Business Combination and the distribution of the Trust Account.

On
May 4, 2023, we entered into a purchase agreement (the “Purchase Agreement”) with the Sponsor and the Original Sponsor, pursuant
to which the Sponsor purchased from the Original Sponsor (x) 7,988,889 Class A ordinary shares and (y) 1,000,000 Private Placement Units,
each consisting of one Class A ordinary share and one-half of one redeemable warrant that is exercisable for one Class A ordinary share,
free and clear of all liens and encumbrances (other than those contained in the Letter Agreement, dated November 3, 2021, that we entered
into with our officers, directors and the Original Sponsor, and the Underwriting Agreement, dated November 3, 2021, that we entered into
with Cantor as representative of the several underwriters (the “Underwriting Agreement”)), for an aggregate purchase price
of $1.00 (the “Purchase Price”) payable at the time of the Initial Business Combination. The transactions contemplated by
the Purchase Agreement closed June 7, 2023, and the Original Sponsor transferred the Private Placement Units and the Class A ordinary
shares to the Sponsor.

Prior
to the Business Combination (defined below), our management had broad discretion with respect to the specific application of the net
proceeds of its IPO and the sale of Private Placement Warrants, although substantially all of the net proceeds were intended to be applied
generally toward consummating a business combination.

Charter
Amendments and Share Redemptions

On
February 3, 2023, our shareholders approved an amendment (the “First Extension Charter Amendment”) to our Amended and Restated
Memorandum and Articles of Association to extend the date by which we were required to consummate an Initial Business Combination from
February 8, 2023, to December 15, 2023. Under Cayman Islands law, the First Extension Charter Amendment took effect upon approval by
the shareholders. In connection with the meeting, shareholders holding approximately 32,116,947 Public Shares exercised their right to
redeem their shares for a pro rata portion of the funds in the Trust Account. As a result, approximately $333 million (approximately
$10.38 per Public Share) was removed from the Trust Account to pay such holders.

81

On
December 14, 2023, our shareholders approved an amendment (the “Second Extension Charter Amendment”) to our Amended and
Restated Memorandum and Articles of Association to extend the date by which we were required to consummate an Initial Business
Combination to September 15, 2024. Under Cayman Islands law, the Second Extension Charter Amendment took effect upon approval by the
shareholders. In connection with the meeting, shareholders holding approximately 880,873 Public Shares exercised their right to
redeem their shares for a pro rata portion of the funds in the Trust Account. As a result, approximately $9.71 million
(approximately $11.03 per Public Share) was removed from the Trust Account to pay such holders. Approximately $16.7 million remained
in the Trust Account as of December 31, 2023, and we had 1,502,180 public shares outstanding as of December 31, 2023.

On
January 31, 2024, our shareholders approved the proposals relating to the entry into and consummation of the Merger Agreement. In connection
with the Meeting, shareholders holding 1,432,457 Public Shares exercised their right to redeem their shares for a pro rata portion of
the funds in the Trust Account. As a result, approximately $16.0 million (approximately $11.14 per Public Share) was removed from the
Trust Account to pay such holders. Following these redemptions, approximately $0.8 million remained in the Trust Account.

Business
Combination

On
the Closing Date, pursuant to the Merger Agreement, Merger Sub merged with and into Tevogen Bio, with Tevogen Bio being the surviving
company and our wholly owned subsidiary (the “Merger,” and together with the other transactions contemplated by the Merger
Agreement, the “Business Combination”). Prior to the effective time of the Merger (the “Effective Time”), pursuant
to the Merger Agreement, we changed our jurisdiction of incorporation by deregistering as a Cayman Islands exempted company and continuing
and domesticating as a corporation incorporated under the laws of the State of Delaware (the “Domestication”). In connection
with the Domestication, we changed our name to “Tevogen Bio Holdings Inc.” Also in connection with the Domestication, our
governing documents were amended and restated.

At
the Effective Time, in accordance with the terms and subject to the conditions of the Merger Agreement, each share of common stock of
Tevogen Bio issued and outstanding immediately prior to the Effective Time was converted into the right to receive the number of shares
of duly authorized, validly issued, fully paid, and nonassessable shares of our common stock, par value $0.0001 per share (the “Common
Stock”), equal to the quotient obtained by dividing (x) the quotient obtained by dividing (i) $1,200,000,000 by (ii) ten dollars
($10.00) by (y) the aggregate number of shares of the common stock of Tevogen Bio that were issued and outstanding immediately prior
to the Effective Time (the “Exchange Ratio”).

Results
of Operations

As
of December 31, 2023, we had not commenced any operations. All activity through December 31, 2023, relates to our formation, the IPO,
the search for an Initial Business Combination, and the consummation of the Business Combination with Tevogen Bio. We did not generate
any operating revenues prior to the completion of the Business Combination. We generated non-operating income in the form of interest
income from the proceeds derived from the IPO placed in the Trust Account.

For
the year ended December 31, 2023, we had a net loss of $67,325, which consisted of unrealized gain on investment held in the Trust
Account of $2,734,426, offset by general and administrative expenses of $2,273,970, change in the fair value of warrants of $21,750, interest expense of $256,031, and impairment of amounts due from related party of $250,000.

For
the year ended December 31, 2022, we had a net income of $4,408,361, which consisted of unrealized gain on investment held in the Trust
Account of $4,948,194 and change in the fair value of warrants of $413,250, offset by general and administrative expenses of $953,083.

Liquidity
and Capital Resources

For
the year ended December 31, 2023, net cash used in operating activities was $1,376,351, net loss of $67,325 was impacted by the unrealized
gain on investments held in the Trust Account of $2,734,426, offset by non-cash interest expense of $256,031, the change in the fair value of warrants of $21,750 and changes
in operating assets and liabilities of $1,147,619.

For
the year ended December 31, 2022, net cash used in operating activities was $215,395, net income of $4,408,361 was impacted by the unrealized
gain on investments held in the Trust Account of $4,948,194, a change in the fair value of warrants of $413,250 and changes in operating
assets and liabilities of $737,688.

82

As
of December 31, 2023, we had $8,835 in cash and $16,681,497 remained in the Trust Account. See “Overview – Charter
Amendments and Share Redemptions” above for a discussion of withdrawals from the Trust Account in connection with redemptions
in 2023.

Our primary sources of funds
to meet our near-term liquidity and capital requirements include cash on hand, including the funding the funding we have received
from the sale of our Series A Preferred Stock, and the funding we expect to receive from the sale of our Series A-1 Preferred Stock.
On February 14, 2024, we entered into a securities purchase agreement with an investor pursuant to which an investor agreed to
purchase shares of our Series A Preferred Stock for an aggregate purchase price of $8.0 million. On March 27, 2024, we entered into
an agreement pursuant to which that amount was reduced to $2.0 million and the investor agreed to purchase shares of our Series A-1
Preferred Stock for an aggregate purchase price of $6.0 million. As of the date of this Annual Report, we have received only $1.2
million of the $6.0 million aggregate purchase price for the shares of Series A-1 Preferred Stock. Even if we receive all of
such proceeds, we will still need additional capital to fully implement our business, operating, and development plans.

We
expect to devote substantial financial resources to our ongoing and planned activities, particularly as we conduct our planned clinical
trials of TVGN 489 and other product candidates. Identifying potential product candidates and conducting pre-clinical testing and clinical
trials is a time-consuming, expensive, and uncertain process that takes years to complete, and we may never generate the necessary data
or results required to obtain marketing approval and achieve product sales. In addition, our product candidates, if approved, may not
achieve commercial success.

We
expect our expenses to increase substantially in connection with our ongoing activities, particularly as we advance our pre-clinical
studies and clinical trials. In addition, if we obtain marketing approval for TVGN 489 in any indication or for any other product candidate
we are developing or develop in the future, we expect to incur significant commercialization expenses related to product manufacturing,
sales, marketing, and distribution. Furthermore, we expect to incur additional costs associated with operating as a public company. Accordingly,
we will need to obtain substantial additional funding.

Until
such time, if ever, as we can generate substantial revenues from product sales, we expect to finance our cash needs through a combination
of public and private equity offerings and debt financings, strategic alliances, collaborations, and marketing, distribution, or licensing
arrangements. However, adequate additional financing may not be available to us on acceptable terms, or at all, and may be impacted by
the economic climate and market conditions. See the risk factor in this Annual Report with the caption beginning “We will require
substantial additional financing to pursue our business objectives ….”

Off-Balance
Sheet Arrangements

We
have no obligations, assets or liabilities, which would be considered off-balance sheet arrangements as of December 31, 2023 and 2022. We do
not participate in transactions that create relationships with entities or financial partnerships, often referred to as variable
interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements. We have not
entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or
commitments of other entities, or purchased any non-financial assets.

Contractual
Obligations

As
of December 31, 2023 and 2022, we did not have any long-term debt, capital lease obligations, operating lease obligations or long-term
liabilities.

Underwriting
Agreement

Cantor
was entitled to deferred underwriting commissions of $14,700,000 in the aggregate, consisting of $13,800,000 deferred underwriting commissions,
and $900,000 cash underwriting discount agreed to be deferred until consummation of the Business Combination. The deferred fee was to
become payable to the underwriter from the amounts held in the Trust Account solely in the event that we completed a Business Combination,
subject to the terms of the Underwriting Agreement.

On
June 28, 2023, we entered into a fee reduction agreement with Cantor (the “Fee Reduction Agreement”) pursuant to which Cantor
agreed to forfeit $9,700,000 of the deferred underwriting fees payable, resulting in a remainder of $5,000,000 of deferred underwriting
fees payable (the “Reduced Deferred Fee”) to Cantor that became payable upon the closing of the Business Combination. The
Reduced Deferred Fee was payable to Cantor in the form of 500,000 shares of our common stock. The Fee Reduction Agreement only applied
to the consummation of the Transaction with Tevogen Bio and no other potential Business Combinations that we may contemplate or consummate.

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JOBS
Act

On
April 5, 2012, the JOBS Act was signed into law. The JOBS Act contains provisions that, among other things, relax certain reporting requirements
for qualifying public companies. We qualify as an “emerging growth company” and under the JOBS Act are allowed to comply
with new or revised accounting pronouncements based on the effective date for private (not publicly traded) companies. We have elected
to delay the adoption of new or revised accounting standards, and as a result, we may not comply with new or revised accounting standards
on the relevant dates on which adoption of such standards is required for non-emerging growth companies. As such, our financial statements
may not be comparable to companies that comply with public company effective dates.

Subject
to certain conditions set forth in the JOBS Act, as an “emerging growth company,” we are not required to, among other things,
(i) provide an auditor’s attestation report on our system of internal control over financial reporting pursuant to Section 404
of the Sarbanes-Oxley Act, (ii) provide all of the compensation disclosure that may be required of non-emerging growth public companies
under the Dodd-Frank Wall Street Reform and Consumer Protection Act, or (iii) comply with any requirement that may be adopted by the
PCAOB regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the
audit and the financial statements (auditor discussion and analysis). These exemptions will apply for a period of five years following
the completion of our IPO or until we are otherwise no longer an emerging growth company, whichever is earlier.

Critical
Accounting Estimates

The
preparation of unaudited condensed financial statements and related disclosures in conformity with accounting principles generally accepted
in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and
liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and income and expenses during
the periods reported. Actual results could materially differ from those estimates. We have identified the following critical accounting
policies:

Warrant
Liabilities

We
account for the Private Placement Warrants included in Private Placement Units and the redeemable warrants (the “Public Warrants”)
that were included in units that we issued in our IPO (collectively, the “Warrants”) in accordance with Accounting Standards
Codification (“ASC”) 815-40, Derivatives and Hedging—Contracts in Entity’s Own Equity (“ASC 815”),
under which the Private Placement Warrants do not meet the criteria for equity classification and must be recorded as liabilities. As
the Private Placement Warrants meet the definition of a derivative as contemplated in ASC 815, the Private Placement Warrants are measured
at fair value at inception and at each reporting date in accordance with ASC 820, Fair Value Measurement, with changes in fair value
recognized in the statements of operations in the period of change.

Ordinary
Shares Subject to Possible Redemption

We
account for our ordinary shares that were subject to possible redemption in accordance with the guidance in ASC Topic 480 “Distinguishing
Liabilities from Equity.” Ordinary shares subject to mandatory redemption are classified as liability instruments and are measured
at fair value. Conditionally redeemable ordinary shares (including ordinary shares that feature redemption rights that are either within
the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within our control) are classified
as temporary equity. At all other times, ordinary shares are classified as shareholders’ equity. Our ordinary shares featured certain
redemption rights that are considered to have been outside of our control and subject to occurrence of uncertain future events. Accordingly,
ordinary shares subject to possible redemption are presented as temporary equity outside of the shareholders’ equity section of
our balance sheets. We recognize changes in redemption value immediately as they occur and adjust the carrying value of redeemable ordinary
shares to equal the redemption value at the end of each reporting period. Increases or decreases in the carrying amount of redeemable
ordinary shares are affected by charges against additional paid in capital and accumulated deficit.

84

Recently
Issued Accounting Pronouncements

In
June 2016, the Financial Accounting Standards Bureau (“FASB”) issued Accounting Standards Update 2016-13 – Financial
Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”). This
update requires financial assets measured at amortized cost basis to be presented at the net amount expected to be collected. The measurement
of expected credit losses is based on relevant information about past events, including historical experience, current conditions, and
reasonable and supportable forecasts that affect the collectability of the reported amount. Since June 2016, FASB issued clarifying updates
to the new standard including changing the effective date for smaller reporting companies. The guidance is effective for fiscal years
beginning after December 15, 2022, and interim periods within those fiscal years, with early adoption permitted. We adopted ASU 2016-13
on January 1, 2023. The adoption of ASU 2016-13 did not have a material impact on its financial statements.

In
December 2023, FASB issued Accounting Standards Update 2023-09, “Improvements to Income Tax Disclosures” (“ASU 2023-09”),
which provides for additional disclosures primarily related to the income tax rate reconciliations and income taxes paid. ASU 2023-09
requires entities to annually disclose the income tax rate reconciliation using both amounts and percentages, considering several categories
of reconciling items, including state and local income taxes, foreign tax effects, tax credits and nontaxable or nondeductible items,
among others. Disclosure of the reconciling items is subject to a quantitative threshold and disaggregation by nature and jurisdiction.
ASU 2023-09 also requires entities to disclose net income taxes paid or received to federal, state and foreign jurisdictions, as well
as by individual jurisdiction, subject to a five percent quantitative threshold. ASU 2023-09 may be adopted on a prospective or retrospective
basis and is effective for fiscal years beginning after December 15, 2024 with early adoption permitted. We are evaluating the impact
of ASU 2023-09 on disclosures in our Financial Statements.

Management
does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material
effect on our condensed financial statements.

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with our audited financial statements and the notes thereto which are included in “Item 8. Financial Statements and Supplementary Data” of this Report. Certain information contained in the discussion and analysis set forth below includes forward-looking statements. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors, including those set forth under “Cautionary Note Regarding Forward-Looking Statements,” “Item 1A. Risk Factors” and elsewhere in this Report.

Overview

Semper Paratus Acquisition Corporation was incorporated as a Cayman Islands exempted company on April 21, 2021. The Company was formed for the purpose of entering into a merger, share exchange, asset acquisition, stock purchase, reorganization or other similar business transaction with one or more businesses that the Company has not yet identified (a “Business Combination”).

We expect to continue to incur significant costs in the pursuit of our acquisition plans. We cannot assure you that our plans to complete a Business Combination will be successful.

Results of Operations

As of December 31, 2022, the Company had not commenced any operations. All activity through December 31, 2022, relates to the Company’s formation, the initial public offering (the “IPO”) and the search for a prospective initial Business Combination. The Company will not generate any operating revenues until after the completion of a Business Combination, at the earliest. The Company will generate non-operating income in the form of interest income from the proceeds derived from the IPO placed in the Trust Account (defined below).

For the year ended December 31, 2022, we had a net income of $4,408,361, which consisted of unrealized gain on investment held in the Trust Account of $4,948,194 and change in the fair value of warrants of $413,250, offset by the general and administrative expenses of $953,083.

For the period from April 21, 2021 (inception) through December 31, 2021, we had a net loss of $28,745, which consisted of general and administrative expenses of $181,421 and transaction costs allocated to warrant issuance of $880, offset by change in fair value of warrants $137,750 and unrealized gain on investment held in the Trust Account of $15,806.

Liquidity and Capital Resources

The Registration Statement on Form S-1, as amended (the “Registration Statement”), for the Company’s IPO was declared effective on November 3, 2021. On November 8, 2021, the Company consummated the IPO of 30,000,000 units (“Units”) with respect to the ordinary shares included in the Units being offered (the “Public Shares”) at $10.00 per Unit generating gross proceeds of $300,000,000, which is discussed in Note 3. The company has selected December 31 as its fiscal year end.

Simultaneously with the closing of the IPO, the Company consummated the sale of 1,360,000 private placement units (“Private Placement Units”) at a price of $10.00 per Private Placement Unit in a private placement to the Company’s sponsor, Semper Paratus Sponsor LLC (the “Sponsor”) and underwriter Cantor Fitzgerald & Co. (“Cantor”) generating gross proceeds of $13,600,000.

Simultaneously with the closing of the IPO, the Company consummated the closing of the sale of 4,500,000 additional Units upon receiving notice of the underwriter’s election to fully exercise its overallotment option (“Overallotment Units”), generating additional gross proceeds of $45,000,000 and incurring additional offering costs of $2,700,000 in underwriting fees all of which is deferred until completion of the Company’s Business Combination. Simultaneously with the exercise of the overallotment, the Company consummated the Private Placement of an additional 90,000 Private Placement Units to the Sponsor, generating gross proceeds of $900,000.

Following the closing of the IPO, $351,900,000 ($10.20 per Unit) from the net proceeds of the sale of the Units in the IPO and the Private Placement Units was placed in a trust account (“Trust Account”) and will be invested in U.S. government securities,

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Table of Contents

within the meaning set forth in Section 2(a)(16) of the Investment Company Act of 1940, as amended (the “Investment Company Act”), with a maturity of 180 days or less or in any open-ended investment company that holds itself out as a money market fund selected by the Company meeting the conditions of paragraphs (d)(2), (d)(3) and (d)(4) of Rule 2a-7 of the Investment Company Act, as determined by the Company, until the earlier of: (i) the completion of a Business Combination and (ii) the distribution of the Trust Account.

For the year ended December 31, 2022, net cash used in operating activities was $215,395, net income of $4,408,361 was impacted by the unrealized gain on investments held in the Trust Account of $4,948,194, a change in the fair value of warrants of $413,250 and changes in operating asset and liabilities of $737,688.

For the period from April 21, 2021 (inception) through December 31, 2021, net cash used in operating activities was $713,825, net loss of $28,745 was impacted by the unrealized gain on investments held in the Trust Account of $15,806, a change in the fair value of warrants of $137,750, transaction costs allocated to warrant issuance of $880 and changes in operating asset and liabilities of $532,405.

We intend to use substantially all of the funds held in the Trust Account, including any amounts representing interest earned on the Trust Account (less taxes payable), to complete our Business Combination. To the extent that our capital stock or debt is used, in whole or in part, as consideration to complete our Business Combination, the remaining proceeds held in the Trust Account will be used as working capital to finance the operations of the target business or businesses, make other acquisitions and pursue our growth strategies.

In order to finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor, or certain of the Company’s officers and directors may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). If the Company completes a Business Combination, the Company would repay the Working Capital Loans out of the proceeds of the Trust Account released to the Company. Otherwise, the Working Capital Loans would be repaid only out of funds held outside the Trust Account. In the event that a Business Combination does not close, the Company may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. Except for the foregoing, the terms of such Working Capital Loans, if any, have not been determined and no written agreements exist with respect to such loans. The Working Capital Loans would either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $1.5 million of such Working Capital Loans may be convertible into private placement-equivalent units at a price of $10.00 per unit. As of December 31, 2022, the Company had no borrowings under the Working Capital Loans.

We do not believe we will need to raise additional funds in order to meet the expenditures required for operating our business. However, if our estimate of the costs of identifying a target business, undertaking in-depth due diligence and negotiating a Business Combination are less than the actual amount necessary to do so, we may have insufficient funds available to operate our business prior to our Business Combination. Moreover, we may need to obtain additional financing either to complete our Business Combination or because we become obligated to redeem a significant number of our Public Shares upon consummation of our Business Combination, in which case we may issue additional securities or incur debt in connection with such Business Combination.

Off-Balance Sheet Arrangements

We have no obligations, assets or liabilities, which would be considered off-balance sheet arrangements as of December 31, 2022. We do not participate in transactions that create relationships with entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements. We have not entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any non-financial assets.

Contractual Obligations

We do not have any long-term debt, capital lease obligations, operating lease obligations or long-term liabilities. The underwriter is entitled to deferred underwriting commissions of $14,700,000 in the aggregate, consisting of $13,800,000 deferred underwriting commissions, and $900,000 cash underwriting discount agreed to be deferred until Business Combination. The deferred fee will become payable to the underwriter from the amounts held in the Trust Account solely in the event that the Company completes a Business Combination, subject to the terms of the underwriting agreement.

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JOBS Act

On April 5, 2012, the JOBS Act was signed into law. The JOBS Act contains provisions that, among other things, relax certain reporting requirements for qualifying public companies. We will qualify as an “emerging growth company” and under the JOBS Act will be allowed to comply with new or revised accounting pronouncements based on the effective date for private (not publicly traded) companies. We are electing to delay the adoption of new or revised accounting standards, and as a result, we may not comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. As such, our financial statements may not be comparable to companies that comply with public company effective dates.

Additionally, we are in the process of evaluating the benefits of relying on the other reduced reporting requirements provided by the JOBS Act. Subject to certain conditions set forth in the JOBS Act, if, as an “emerging growth company,” we choose to rely on such exemptions we may not be required to, among other things, (i) provide an auditor’s attestation report on our system of internal control over financial reporting pursuant to Section 404 of the Sarbanes-Oxley Act, (ii) provide all of the compensation disclosure that may be required of non-emerging growth public companies under the Dodd-Frank Wall Street Reform and Consumer Protection Act, (iii) comply with any requirement that may be adopted by the PCAOB regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements (auditor discussion and analysis) and (iv) disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of executive compensation to median employee compensation. These exemptions will apply for a period of five years following the completion of our IPO or until we are no longer an “emerging growth company,” whichever is earlier.

Critical Accounting Policies

The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and income and expenses during the periods reported. Actual results could materially differ from those estimates. We have identified the following critical accounting policies:

Warrant Liabilities

We account for the Private Placement Warrants included in Private Placement Units and the redeemable warrants (the “Public Warrants”) that were included in units issued by the Company in its Initial Public Offering (collectively, the “Warrants”) in accordance with Accounting Standards Codification (“ASC”) 815-40, Derivatives and Hedging—Contracts in Entity’s Own Equity (“ASC 815”), under which the Private Placement Warrants do not meet the criteria for equity classification and must be recorded as liabilities. As the Private Placement Warrants meet the definition of a derivative as contemplated in ASC 815, the Private Placement Warrants are measured at fair value at inception and at each reporting date in accordance with ASC 820, Fair Value Measurement, with changes in fair value recognized in the statement of operations in the period of change.

Ordinary Shares Subject to Possible Redemption

We account for our ordinary shares subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Ordinary shares subject to mandatory redemption are classified as liability instruments and are measured at fair value. Conditionally redeemable ordinary shares (including ordinary shares that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within our control) are classified as temporary equity. At all other times, ordinary shares are classified as shareholders’ equity. Our ordinary shares feature certain redemption rights that are considered to be outside of our control and subject to occurrence of uncertain future events. Accordingly, ordinary shares subject to possible redemption are presented as temporary equity, outside of the shareholders’ equity section of our balance sheets. The Company recognizes changes in redemption value immediately as they occur and adjusts the carrying value of redeemable ordinary shares to equal the redemption value at the end of each reporting period. Increases or decreases in the carrying amount of redeemable ordinary shares are affected by charges against additional paid in capital and accumulated deficit.

Management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on our financial statements.

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Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our audited financial statements and the notes related thereto contained elsewhere in this Report. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.

All statements other than statements of historical fact included in this Report including, without limitation, statements under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” regarding the Company’s financial position, business strategy and the plans and objectives of management for future operations, are forward-looking statements. When used in this Report, words such as “anticipate,” “believe,” “estimate,” “expect,” “intend” and similar expressions, as they relate to us or the Company’s management, identify forward-looking statements. Such forward-looking statements are based on the beliefs of management, as well as assumptions made by, and information currently available to, the Company’s management. Actual results could differ materially from those contemplated by the forward-looking statements as a result of many factors, including those set forth under “Cautionary Note Regarding Forward-Looking Statements,” “Item 1A. Risk Factors” and elsewhere in this Report.

Overview

We are a blank check company formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more target businesses. We intend to effectuate our business combination using cash from the proceeds of our initial public offering and the sale of the placement units that occurred simultaneously with the completion of our IPO, our ordinary shares, debt or a combination of cash, shares and debt.

We expect to continue to incur significant costs in the pursuit of our acquisition plans. We cannot assure you that our plans to complete a business combination will be successful.

Risks and Uncertainties

In February 2022, the Russian Federation commenced a military action with the country of Ukraine. As a result of this action, various nations, including the United States, have instituted economic sanctions against the Russian Federation. The invasion of Ukraine may result in market volatility that could adversely affect our stock price. Further, the impact of this action and related sanctions on the world economy are not determinable as of the date of these financial statements and the specific impact on the Company’s financial condition, results of operations, and cash flows is also not determinable as of the date of these financial statements.

Management continues to evaluate the impact of the COVID-19 pandemic on the industry and has concluded that while it is reasonably possible that the virus could have a negative effect on our financial position, results of our operations and/or search for a target company, the specific impact is not readily determinable as of the date of the financial statements. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Results of Operations

We have neither engaged in any operations nor generated any operating revenues to date. Our only activities from inception through December 31, 2021 were organizational activities and those necessary to prepare for the IPO, described below, and since the IPO, the search for a prospective initial business combination. We do not expect to generate any operating revenues until after the completion of our initial business combination, at the earliest. We expect to generate non-operating income in the form of interest income from the proceeds of the IPO placed in the trust account. We expect that we will 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 expenses in connection with searching for, and completing, a business combination.

For the year ended December 31, 2021, we had a net loss of $28,745 which primarily consists of operating expenses of $181,421, offset by change in fair value of warrants $137,750 and interest earned on marketable securities held in the trust account of $15,806.

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Liquidity and Going Concern

On November 8, 2021, we consummated the IPO of 30,000,000 units, at $10.00 per unit generating gross proceeds of $300,000,000. Simultaneously with the closing of the IPO, we consummated the sale of 1,360,000 private placement units at a price of $10 per private placement unit in a private placement to the Company’s sponsor and Cantor generating gross proceeds of $13,600,000.

Simultaneously with the closing of the IPO, the Company consummated the closing of the sale of 4,500,000 additional Units upon receiving notice of the underwriter’s election to fully exercise its overallotment option (“Overallotment Units”), generating additional gross proceeds of $45,000,000 and incurring additional offering costs of $2,700,000 in underwriting fees all of which are deferred until completion of the initial business combination. Simultaneously with the exercise of the overallotment, the Company consummated the private placement of an additional 90,000 placement units to the sponsor, generating gross proceeds of $900,000.

For the year ended December 31, 2021, cash used in operating activities was $713,825. Net Cash used in investing activities was $351,900,000 and Net cash provided by financing activities was $352,958,406 mainly reflecting the proceeds of our IPO and subsequent deposit into the trust account.

At December 31, 2021, we had cash and marketable securities held in the trust account of $351,915,805. We intend to use substantially all of the funds held in the trust account, including any amounts representing interest earned on the trust account (less income taxes payable), to complete our business combination. To the extent that our capital stock or debt is used, in whole or in part, as consideration to complete our Business Combination, the remaining proceeds held in the trust account will be used as working capital to finance the operations of the target business or businesses, make other acquisitions and pursue our growth strategies.

At December 31, 2021, we had cash of $344,581 outside of the trust account. We intend to use the funds held outside the trust account primarily to identify and evaluate target businesses, perform business due diligence on prospective target businesses, travel to and from the offices, plants or similar locations of prospective target businesses or their representatives or owners, review corporate documents and material agreements of prospective target businesses, and structure, negotiate and complete a business combination.

In addition, in order to finance transaction costs in connection with our initial business combination, the sponsor or an affiliate of the sponsor, or certain of the Company’s officers and directors may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). If the Company completes its initial business combination, the Company would repay the Working Capital Loans out of the proceeds of the trust account released to the Company. Otherwise, the Working Capital Loans would be repaid only out of funds held outside the trust account. In the event that our initial business combination does not close, the Company may use a portion of proceeds held outside the trust account to repay the Working Capital Loans but no proceeds held in the trust account would be used to repay the Working Capital Loans. Except for the foregoing, the terms of such Working Capital Loans, if any, have not been determined and no written agreements exist with respect to such loans. The Working Capital Loans would either be repaid upon consummation of our initial business combination, without interest, or, at the lender’s discretion, up to $1.5 million of such Working Capital Loans may be convertible into private placement-equivalent units at a price of $10.00 per unit. As of December 31, 2021, the Company had no borrowings under the Working Capital Loans.

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 a potential transaction, and reducing overhead expenses. The Company cannot provide any 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 the financial statements. These financial statements do not include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be necessary should the Company be unable to continue as a going concern.

Off-Balance Sheet Arrangements

We have no obligations, assets or liabilities, which would be considered off-balance sheet arrangements as of December 31, 2021. We do not participate in transactions that create relationships with entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements. We have not entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any non-financial assets.

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Contractual Obligations

We do not have any long-term debt, capital lease obligations, operating lease obligations or long-term liabilities.

The underwriters were paid a cash underwriting discount of $0.20 per unit, or $6,000,000 in the aggregate at the closing of the IPO. The underwriters have agreed to defer the cash underwriting discount of $0.20 per share related to the over-allotment to be paid at Business Combination ($900,000 in the aggregate). In addition, the underwriters are entitled to a deferred underwriting commissions of $0.40 per unit, or $13,800,000 from the closing of the IPO. The total deferred fee is $14,700,000 consisting of the $13,800,000 deferred portion and the $900,000 cash discount agreed to be deferred until the completion of our initial business combination. The deferred fee will become payable to the underwriters from the amounts held in the trust account solely if the Company completes our initial business combination, subject to the terms of the underwriting agreement.

JOBS Act

On April 5, 2012, the JOBS Act was signed into law. The JOBS Act contains provisions that, among other things, relax certain reporting requirements for qualifying public companies. We will qualify as an “emerging growth company” and under the JOBS Act will be allowed to comply with new or revised accounting pronouncements based on the effective date for private (not publicly traded) companies. We are electing to delay the adoption of new or revised accounting standards, and as a result, we may not comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. As such, our financial statements may not be comparable to companies that comply with public company effective dates.

Additionally, we are in the process of evaluating the benefits of relying on the other reduced reporting requirements provided by the JOBS Act. Subject to certain conditions set forth in the JOBS Act, if, as an “emerging growth company,” we choose to rely on such exemptions we may not be required to, among other things, (i) provide an auditor’s attestation report on our system of internal control over financial reporting pursuant to Section 404 of the Sarbanes-Oxley Act, (ii) provide all of the compensation disclosure that may be required of non-emerging growth public companies under the Dodd-Frank Wall Street Reform and Consumer Protection Act, (iii) comply with any requirement that may be adopted by the PCAOB regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements (auditor discussion and analysis) and (iv) disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of executive compensation to median employee compensation. These exemptions will apply for a period of five years following the completion of our IPO or until we are no longer an “emerging growth company,” whichever is earlier.

Critical Accounting Policies

The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and income and expenses during the periods reported. Actual results could materially differ from those estimates.

Warrant Liabilities

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

For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of additional paid-in-capital at the time of issuance. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded at their initial fair value on the date of issuance, and each balance sheet date thereafter. Changes in the estimated fair value of the warrants are recognized as a non-cash gain or loss on the statements of operations.

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Class A Ordinary Shares Subject to Possible Redemption

The Company accounts for its ordinary shares subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Class A ordinary shares subject to mandatory redemption (if any) are classified as a liability instrument and are measured at fair value. Conditionally redeemable Class A ordinary shares (including Class A ordinary shares that features redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) is classified as temporary equity. At all other times, Class A ordinary shares are classified as shareholders’ equity. The Company’s Public Shares feature certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, at December 31, 2021, 34,500,000 Class A ordinary shares subject to possible redemption are presented as temporary equity, outside of the shareholders’ deficit section of the Company’s balance sheet.

Net Loss per Ordinary Share

The Company has two classes of shares. Earnings and losses are shared pro rata between the two classes of shares. Net loss per share is computed by dividing net loss by the weighted average number of shares of ordinary shares outstanding during the period, excluding shares of ordinary share subject to forfeiture by the sponsor. At December 31, 2021, the Company did not have any dilutive securities and/or other contracts that could, potentially, be exercised or converted into shares of ordinary share and then share in the earnings of the Company. As a result, diluted loss per share is the same as basic loss per share for the period presented.

Recent Accounting Standards

In August 2020, the FASB issued Accounting Standard Update (“ASU”) No. 2020-06, Debt -Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging -Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity, which simplifies accounting for convertible instruments by removing major separation models required under current GAAP. The ASU removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception, and it also simplifies the diluted earnings per share calculation in certain areas. The Company adopted ASU 2020-06 on April 21, 2021, with no impact upon adoption. The Company’s management does not believe that any other recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on the Company’s financial statement.

Management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on our financial statements.