SecProbe.io

CORRESP
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filename1.htm

October
27, 2023

Mr.
Daniel Morris

Legal
Branch Chief

Office
of Energy & Transportation

Division
of Corporation Finance

Securities
and Exchange Commission

Washington
DC 20549

    Re:
    Jet.AI
    Inc.

    Registration
    Statement on Form S-1

    Filed
    September 8, 2023

    File
    No. 333-274432

Dear
Mr. Morris:

We
acknowledge receipt of the comments in your letter dated October 5, 2023 and via telephone comment regarding the Registration Statement
of Jet.AI Inc. (the “Company”), which we have set out below, together with our responses. All terms not defined in this letter
have the meanings assigned to them in the Registration Statement.

Telephone
Comment received October 5, 2023.

As
requested by the Staff, the Company has checked the description of the shares being sold by the selling stockholders and checked the
calculation of fees in the Registration Statement and believes that the fee table as filed was correct.

In
light of the change in the market prices of the Company’s securities, the Company has added additional shares to be registered
under the Registration Statement to meet its potential obligations under the GEM Share Purchase Agreement, including the possibility
of paying the commitment fee in shares in lieu of cash, and has added additional shares and warrants per request from other securityholders
that have registration rights. As a result, the Registration Statement now relates to sales of 43,819,408 shares of Common Stock as follows:

    ●
    24,390,627
    shares of Common Stock representing shares that have either been issued or are issuable as follows:

    ○
    385,000
    shares issued and outstanding to Maxim,

    ○
    112,700
    shares issuable to Maxim upon conversion of Series A Preferred,

    ○
    12,300
    shares issuable to Maxim in the event the Company declares and issues a PIK dividend on the Series A Preferred Shares,

    ○
    548,127
    shares issued to Meteora,

    ○
    400,000
    shares issuable to GEM at the Company’s option in lieu of a commitment fee pursuant to the Share Purchase Agreement,

    ○
    20,000,000
    shares issuable to GEM in exchange for drawdowns pursuant to the Share Purchase Agreement,

    ○
    57,500
    shares issuable upon conversion of the Series A-1 Preferred Shares,

    ○
    2,875,000
    shares held by the Sponsor, pursuant to the Sponsor’s registration rights,

    ●
    19,428,781
    shares issuable upon exercise of the following warrants

    ○
    11,489,334
    shares underlying the JTAIW Warrants,

    ○
    2,179,447
    shares underlying the GEM Warrant, and

    ○
    5,760,000
    shares underlying the private warrants held by the Sponsor and Maxim, which warrants are exercisable.

Registration
Statement on Form S-1 filed September 8, 2023

Cover
Page

    1.
    For
    each of the shares being registered for resale, disclose the price that the selling stockholders paid for the shares or the securities
    overlying such shares.

The
Company has revised the cover page of the prospectus to highlight the prices at which the selling stockholders acquired, or will acquire,
their shares of Common Stock or the securities overlying such shares. We note that the price to be paid by GEM pursuant to the Share
Purchase Agreement between the Company and GEM is not definitive at this time and, as a result, we have instead disclosed that such price
will be equal to 90% of the average daily closing price during the applicable 30-day drawdown pricing period.

    2.
    Disclose
    the exercise price(s) of the warrants compared to the market price of the underlying shares. If the warrants are out the money, please
    disclose the likelihood that warrant holders will not exercise their warrants. Provide similar disclosure in the Prospectus Summary,
    Risk Factors, MD&A and Use of Proceeds section and disclose that cash proceeds associated with the exercises of the warrants
    are dependent on the stock price. As applicable, describe the impact on your liquidity and update the discussion on the ability of
    the Company to fund your operations on a prospective basis with your current cash on hand.

The
Company has revised the disclosure as requested by the Staff.

    3.

    We
    note the significant number of redemptions of your common stock in connection with your Extension Amendment Proposal and that the
    shares being registered for resale will constitute a considerable percentage of your public float. Please revise your disclosure
    here to include the total number of redemptions of Oxbridge shares in connection with the consummation of your business combination.
    Highlight the significant negative impact sales of shares on this registration statement could have on the public trading price of
    the Company’s common stock.

The
Company has revised the disclosure to include the number of redemptions requested in November 2022 and August 2023 and has highlighted
the significant negative impact sales pursuant to the Registration Statement may have on the public trading price.

    2

Prospectus
Summary

Forward
Purchase Agreement, page 10

    4.
    We
    note your disclosures on pages 10-12 regarding the Forward Purchase Agreement and the FPA Funding Amount PIPE Subscription Agreements.
    Please revise to explain the purpose for entering into these agreements and the inter-relationship between them. In this regard,
    we refer to the disclosures on page 11 indicating that the Company paid the Prepayment Amount required under the Forward Purchase
    Agreement directly from the Trust Account to the PIPE/FPA investors in order to fund the PIPE investments. Please disclose the Prepayment
    Amount paid by the Company to the PIPE/FPA investors and the net proceeds to the Company from this arrangement. Also, discuss here,
    and add risk factor disclosure, as appropriate, to address risks associated with these arrangements. Lastly, please revise to indicate
    whether Oxbridge, Jet Token, the Company, or their directors, officers, advisors or respective affiliates had material relationships
    with the PIPE/FPA investors at the time the PIPE and FPA agreements were negotiated. We may have additional comments.

The
Company has revised the disclosure as requested by the Staff. The Company respectfully advises the Staff that none of Oxbridge, Jet Token,
the Company, or their directors, officers, advisors or respective affiliates had material relationships with the Meteora entities and
therefore the Company has not added any disclosure to the prospectus.

Risk
Factors

Risks
Relating to Ownership of Jet.AI Common Stock, page 25

    5.

    Include
    an additional risk factor highlighting the negative pressure potential sales of shares pursuant to this registration statement could
    have on the public trading price of the Company’s common stock. To illustrate this risk, disclose the purchase price of the
    shares being registered for resale and the percentage that these shares currently represent of the total number of shares outstanding.
    Also disclose that even though the current trading price is significantly below the SPAC IPO price, the private investors have an
    incentive to sell because they will still profit on sales because of the lower price that they purchased their shares than the public
    investors.

The
Company has revised the disclosure to include a risk factor regarding the negative pressure potential sales of shares pursuant to the
Registration Statement and the sale of shares by private investors, once the lock-up agreements covering such shares are no longer in
effect, could have on the public trading price of the Common Stock. The Company respectfully advises the Staff that it does not yet know
the price at which GEM will acquire shares under the Share Purchase Agreement.

    3

Management’s
Discussion and Analysis of Financial Condition and Results of Operations, page 43

    6.

    We
    note that the projected revenues for 2023 were $33.9 million, as set forth in the unaudited prospective financial information management
    prepared and provided to the Board, the Company’s financial advisors and the SPAC in connection with the evaluation of the
    Business Combination. We also note that your actual revenues for the six months ended June 30, 2023 was approximately $4.7 million.
    It appears that you will miss your 2023 revenue projections. Please update your disclosure in Liquidity and Capital Resources, and
    elsewhere, to provide updated information about the Company’s financial position and further risks to the business operations
    and liquidity in light of these circumstances.

The
Company has revised the disclosure as requested by the Staff.

Overview,
page 43

    7.

    In
    light of the significant number of redemptions and the unlikelihood that the Company will receive significant proceeds from exercises
    of the warrants because of the disparity between the exercise price of the warrants and the current trading price of the Company’s
    common stock, expand your discussion of capital resources to address any changes in the Company’s liquidity position since
    the Business Combination. If the Company is likely to have to seek additional capital, discuss the effect of this offering on the
    company’s ability to raise additional capital.

The
Company has revised the disclosure as requested by the Staff.

    8.

    Please
    expand your discussion here to reflect the fact that this offering involves the potential sale of a substantial portion of shares
    for resale and discuss how such sales could impact the market price of the Company’s common stock. Your discussion should highlight
    the fact that your institutional investors, who currently beneficial own over 35.6% of your outstanding shares, will be able to sell
    all of their shares for so long as the registration statement of which this prospectus forms a part is available for use.

The
Company has revised the disclosure as requested by the Staff.

General

    9.

    Revise
    your prospectus to disclose the price that each selling stockholder paid for the shares being registered for resale. Highlight any
    differences in the current trading price, the prices that the selling stockholders acquired their shares and warrants, and the price
    that the public stockholders acquired their shares and warrants. Disclose that while the selling stockholders may experience a positive
    rate of return based on the current trading price, the public stockholders may not experience a similar rate of return on the securities
    they purchased due to differences in the purchase prices and the current trading price. Please also disclose the potential profit
    the selling stockholders will earn based on the current trading price. Lastly, please include appropriate risk factor disclosure.

The
Company has revised the disclosure as requested by the Staff.

    4

    10.

    We
    note that you are registering the primary issuance and the resale of such shares under your Share Purchase Agreement with GEM as
    an indirect primary offering. Please provide us with your analysis as to why you believe you are able to register the primary issuance
    of these shares. Refer to Securities Act C&DI 139.13.

The
Company has revised the disclosure throughout to indicate that only the resale of shares by GEM are being registered. The Company intends
to issue shares in the primary offering under the Share Purchase Agreement pursuant to Section 4(a)(2) of the Securities Act.

    11.
    We
    note that GEM, a selling stockholder, is the equity line investor under your Share Purchase Agreement dated as of August 4, 2022.
    Please revise to indicate that GEM is an underwriter. Refer to Securities Act C&DI 139.13.

The
Company has revised the prospectus to indicate that GEM may be deemed to be an underwriter within the meaning of Section 2(a)(11) of
the Securities Act.

    12.
    Please revise your prospectus to provide
the following disclosures with respect to your Share Purchase Agreement with GEM:

    ●
    the
    material risks of an investment in the Company and in the offering, including:

    ○
    the
    possibility that the Company may not have access to the full amount available to it under the equity line; and

    ○
    whether
    GEM can engage in short-selling activities and, if so, how any sale activities after announcement of a put may negatively affect
    the Company’s share price.

    ●
    the
    material market activities of the GEM, including:

    ○
    any
    short selling of the Company’s securities or other hedging activities that the GEM may or has engaged in, including prior to
    entering into the agreement and prior to the receipt of any shares pursuant to the terms of the agreement; and

    ○
    how
    GEM intends to distribute the securities it owns or will acquire.

    ●
    how
    the provisions of Regulation M may prohibit GEM and any other distribution participants that are participating in the distribution
    of the Company’s securities from:

    ○
    engaging
    in market making activities (e.g., placing bids or making purchases to stabilize the price of the common stock) while the equity
    line is in effect; and

    ○
    purchasing
    shares in the open market while the equity line is in effect.

The
Company respectfully advises the Staff that pursuant to Section 4.10 of the Share Purchase Agreement, GEM has agreed that neither GEM
nor its affiliates will, directly or indirectly, sell any securities of the Company except those shares that it owns or has the right
to purchase pursuant to the agreement. GEM further agreed that neither it nor its affiliates will, directly or indirectly, engage in
short sales, whether or not against the box, establish any “put equivalent position” with respect to the Company’s
shares, borrow or pre-borrow any shares of the Company, or grant any other right (including, without limitation, any put or call option)
with respect to the Company’s shares. As a result, the Company has not included a risk factor discussing the possible impact of
such activities by GEM. GEM has agreed in the Share Purchase Agreement that it will comply with Regulation M and Rule 10b-5, among other
requirements of the Securities Act and the Exchange Act.

    5

The
Company has revised the disclosure as requested by the Staff to address the possibility that the Company may not have access to the full
amount of the equity line and to disclose the contractual provisions applicable to GEM with respect to market activities.

    13.

    We
    note that you are seeking to register the primary issuance of the shares underlying the GEM warrant and shares underlying Series
    A Preferred Shares. Please provide your analysis as to why you believe you are eligible to register the primary issuance of the underlying
    common shares as the overlying securities appear to have been offered privately. Alternatively, please revise your registration fee
    table and prospectus to indicate that the registration statement does not cover the offer and sale of these underlying securities.
    For guidance, refer to Securities Act Sections C&DIs 103.04, 134.02 and 239.15..”

The
Company has revised the disclosure to clarify that the primary issuance of shares underlying the GEM warrant is not being registered
and only the resale by GEM is being registered. Likewise, the Company has revised the disclosure to make clear that only the resale of
the Common Stock underlying the Series A Preferred is being registered pursuant to the Registration Statement.

    14.

    We
    note you have issued 270,000 shares of common stock to Maxim to settle your payment obligations under the underwriting agreement
    dated August 11, 2021, and that up to 125,000 shares of common stock are issuable to Max