Airship AI Holdings, Inc S-1, filed Jun 21, 2024

Airship AI Holdings, Inc. (AISP)

S-1 2024-06-21

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Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☒

	Per Share	Total
Public offering price	$	$
Underwriting discounts and commissions⁽¹⁾	$	$
Proceeds to us, before expenses	$	$

ABOUT THIS PROSPECTUS		2

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS		3

PROSPECTUS SUMMARY		4

THE OFFERING		8

RISK FACTORS		10

USE OF PROCEEDS		32

CAPITALIZATION		33

DILUTION		34

MARKET INFORMATION OF OUR SECURITIES		35

DESCRIPTION OF SECURITIES BEING OFFERED	36

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS		37

DESCRIPTION OF AIRSHIP AI’S BUSINESS		46

DIRECTORS AND EXECUTIVE OFFICERS		53

EXECUTIVE COMPENSATION		59

BENEFICIAL OWNERSHIP OF SECURITIES		66

CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS, AND DIRECTOR INDEPENDENCE		68

DESCRIPTION OF OUR SECURITIES		72

MATERIAL U.S. FEDERAL INCOME TAX CONSIDERATIONS		84

UNDERWRITING		89

EXPERTS		93

LEGAL MATTERS		93

WHERE YOU CAN FIND MORE INFORMATION		93

INDEX TO FINANCIAL STATEMENTS		F-1

	·	changes in the competitive industries and markets in which we operate or plan to operate;

	·	changes in applicable laws or regulations affecting our business;

	·	our ability to implement business plans, forecasts, and other expectations, and identify and realize additional opportunities;

	·	risks related to our potential inability to achieve or maintain profitability and generate significant revenue;

	·	current and future conditions in the global economy, including as a result of economic uncertainty, and its impact on us, our business and the markets in which we operate;

	·	our potential inability to manage growth effectively;

	·	our ability to recruit, train and retain qualified personnel;

	·	estimates for the prospects and financial performance of our business may prove to be incorrect or materially different from actual results;

	·	risks related to our marketing and growth strategies;

	·	the effects of competition on our business;

	·	expectations with respect to future operating and financial performance and growth, including when we will generate positive cash flow from operations; and

	·	our ability to raise funding on reasonable terms as necessary to develop our products in the timeframe contemplated by our business plan.

Issuer		Airship AI Holdings, Inc.

Common Stock being Offered		shares of common stock, assuming the sale of our common stock at an assumed public offering price of $ per share (the last reported sale price per share of our common stock on The Nasdaq Global Market on , 2024).

Common Stock Outstanding Before this Offering		23,159,219

Common Stock to be Outstanding Immediately After this Offering

Over-allotment Option		We have granted the underwriters a 45-day option to purchase up to an aggregate of shares of common stock (equal to 15% of the number of shares of common stock sold in this offering), less underwriting discounts and commissions on the same terms as set forth in this prospectus.

Use of Proceeds		We estimate that the net proceeds from this offering will be approximately $ million, or $ million if the underwriters exercise their over-allotment option in full, after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us. We currently intend to use the net proceeds from this offering for working capital and general corporate purposes. See “Use of Proceeds” for additional information.

Representative Warrants		The registration statement of which this prospectus is a part also registers for sale warrants (the “Representative Warrants”) to purchase shares of common stock (equal to 10% of the number of shares of common stock sold in this offering, including any shares of common stock sold to cover over-allotments, if any) to Roth Capital Partners, LLC (the “Representative”), as representative of the underwriters in the offering, as a portion of the compensation payable to the Representative in connection with this offering. The Representative Warrants will be immediately exercisable at an exercise price of $ (100% of the public offering price per share of the shares offered hereby) and expire on the fifth anniversary of the commencement of sales of this offering. See “Underwriting” section on page 93.

Risk Factors		An investment in our securities involves a high degree of risk. See “Risk Factors” beginning on page 7 of this prospectus and the other information included in this prospectus for a discussion of the risk factors you should carefully consider before deciding to invest in our securities.

Nasdaq Symbols		Our common stock is listed on The Nasdaq Global Market under the symbol “AISP” and our public warrants are listed on The Nasdaq Capital Market under the symbol “AISPW.”

	·	the fiscal year end procurement cycle of our government customers, and in particular U.S. government customers which have a fiscal year end of September 30;

	·	the fiscal year budgeting process for our commercial customers, many of which have a fiscal year end of December 31;

	·	seasonal reductions in business activity during the summer months in the United States, Europe, and certain other regions; and

	·	timing of projects and our customers’ evaluation of our work progress.

	·	our failure to predict market demand accurately in terms of product functionality and to supply offerings that meet this demand in a timely fashion;

	·	product defects, errors, or failures or our inability to satisfy customer service level requirements;

	·	negative publicity or negative private statements about the security, performance, or effectiveness of our platforms or product enhancements;

	·	delays in releasing to the market our new offerings or enhancements to our existing offerings, including new product modules;

	·	introduction or anticipated introduction of competing platforms or functionalities by our competitors;

	·	inability of our platforms or product enhancements to scale and perform to meet customer demands;

	·	receiving qualified or adverse opinions in connection with security or penetration testing, certifications or audits, such as those related to IT controls and security standards and frameworks or compliance;

	·	poor business conditions for our customers, causing them to delay software purchases;

	·	reluctance of customers to purchase proprietary software products;

	·	reluctance of our customers to purchase products hosted by our vendors and/or service interruption from such providers; and

	·	reluctance of customers to purchase products incorporating open source software.

	·	be time-consuming and expensive to defend, whether meritorious or not;

	·	require us to stop providing products or services that use the technology that allegedly infringes the other party’s intellectual property;

	·	divert the attention of our technical and managerial resources;

	·	require us to enter into royalty or licensing agreements with third-parties, which may not be available on terms that we deem acceptable;

	·	prevent us from operating all or a portion of our business or force us to redesign our products, services or technology platforms, which could be difficult and expensive and may make the performance or value of our product or service offerings less attractive;

	·	subject us to significant liability for damages or result in significant settlement payments; or

	·	require us to indemnify our customers.

	·	selling to governmental agencies can be highly competitive, expensive and time consuming, often requiring significant upfront time and expense without any assurance that such efforts will generate a sale;

	·	government certification requirements applicable to our platform may change and, in doing so, restrict our ability to sell into the governmental sector until we have attained the revised certification;

	·	government demand and payment for our platform may be impacted by public sector budgetary cycles and funding authorizations, with funding reductions or delays adversely affecting public sector demand for our platform; and

	·	governments routinely investigate and audit government contractors’ administrative processes, and any unfavorable audit could result in the government refusing to continue buying our platform, which would adversely impact our revenue and operating results.

	·	inability to integrate or benefit from acquired technologies, products, personnel or services in a profitable manner;

	·	unanticipated costs or liabilities associated with the acquisition, including potential liabilities due to litigation and potential identified or unknown security vulnerabilities in acquired technologies that expose us to additional security risks or delay our ability to integrate the product into our offerings or recognize the benefits of our investment;

	·	differences between our values and those of an acquired company, as well as potential disruptions to our workplace culture;

	·	incurrence of acquisition-related costs, including costs related to integration activities;

	·	difficulty integrating the accounting and information systems, operations, and personnel of the acquired business;

	·	augmenting the acquired technologies and platforms to the levels that are consistent with our brand and reputation;

	·	difficulties and additional expenses associated with supporting legacy products and hosting infrastructure of the acquired business;

	·	challenges converting the acquired company’s revenue recognition policies and forecasting the related revenues, including subscription-based revenues and software license revenues;

	·	potential write-offs of acquired assets or investments, and potential financial and credit risks associated with acquired customers;

	·	difficulty converting the customers of the acquired business onto our platform and contract terms;

	·	diversion of management’s attention and other company resources;

	·	harm to our existing business relationships with business partners and customers as a result of the acquisition;

	·	the potential loss of key employees;

	·	use of resources that are needed in other parts of our business; and

	·	use of substantial portions of our available cash to consummate the acquisition.

	·	the common stock being offered under this prospectus represents approximately % of the shares of common stock outstanding as of , 2024, and sales of a significant number of such shares could materially adversely affect the trading prices of our securities;

	·	the realization of any of the risk factors presented in this prospectus;

	·	the concentration of the ownership of our shares by a limited number of affiliated stockholders may limit interest in our securities;

	·	limited “public float” with a small number of persons whose sales or lack of sales could result in positive or negative pricing pressure on the market price for the common stock;

	·	additions or departures of key personnel;

	·	loss of a strategic relationship;

	·	variations in operating results from the expectations of securities analysts or investors;

	·	announcements of new products or services by us or our competitors;

	·	reductions in the market share of our products;

	·	announcements by us or our competitors of significant acquisitions, strategic partnerships, joint ventures or capital commitments;

	·	investor perception of our industry or prospects;

	·	insider selling or buying;

	·	investors entering into short sale contracts;

	·	regulatory developments affecting our industry;

	·	changes in our industry;

	·	competitive pricing pressures;

	·	our ability to obtain working capital financing;

	·	our ability to execute our business plan;

	·	operating results that fall below expectations;

	·	revisions in securities analysts’ estimates or reductions in security analysts’ coverage; and

	·	economic and other external factors.

	·	the ability of our board of directors to issue shares of preferred stock and to determine the price and other terms of those shares, including preferences and voting rights, without stockholder approval, which could be used to significantly dilute the ownership of a hostile acquiror;

	·	the right of our board of directors to elect a director to fill a vacancy created by the expansion of our board of directors or the resignation, death or removal of a director, which may prevent stockholders from being able to fill vacancies on our board of directors;

	·	the requirement that a special meeting of stockholders may be called only by our board of directors or the chairman of the board of directors, which could delay the ability of our stockholders to force consideration of a proposal or to take action, including the removal of directors; and

	·	on an actual basis; and

	·	on an as adjusted basis to reflect the issuance and sale of common stock in this offering, after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us.

	March 31, 2024
	Actual			Pro Forma
	(Unaudited)			(Unaudited)
Cash and cash equivalents	$	1,726

Senior Secured Convertible Promissory Notes	$	4,205
Warrant liability		7,515
Earnout liability		26,618
	$	38,338

STOCKHOLDERS' EQUITY
Common stock	$	2
Additional paid in capital		1,398
Accumulated deficit		(49,441	)
Accumulated other comprehensive loss		(10	)
Total stockholders' equity	$	(48,051	)
Total capitalization	$	(7,987	)

	·	5,114,589 shares of common stock issuable upon the exercise of stock options outstanding at a weighted average exercise price of $0.86 per share;

	·	3,931,241 shares of common stock reserved for future grants of equity-based awards under our equity incentive plan;

	·	16,159,112 shares of common stock issuable upon the exercise of public warrants at an exercise price of $7.80 per share;

	·	515,000 shares of common stock issuable upon the exercise of private warrants at an exercise price of $7.80 per share;

	·	2,689,902 shares of common stock issuable upon the exercise of warrants at an exercise price of $1.77 per share;

	·	1,758,105 shares of common stock underlying stock appreciation rights with a base value of $0.12 per share; and

	·	931,794 shares of common stock issuable upon the conversion of convertible debentures at an assumed conversion price of $2.275 per share.

Assumed public offering price per share				$
Net tangible book value per share as of March 31, 2024	$	(2.07	)
Increase in net tangible book value per share attributable to this offering
Pro forma as adjusted net tangible book value per share after this offering
Amount of dilution in net tangible book value per share to new investors in this offering

	Liability as of
	March 31, 2024⁽¹⁾

Earnout liability	$	26,618,278
Senior Secured Convertible Promissory Notes		4,204,743
Warrant liability (Public Warrants)		7,311,998
Warrant liability (Private Warrants)		203,078
Total liabilities measured at fair value	$	38,338,097

Other expense related to instruments recorded at fair value during the three months ended March 31, 2024	$	30,371,318

	Liability as of
	December 31, 2023⁽²⁾

Earnout liability	$	5,133,428
Senior Secured Convertible Promissory Notes		2,825,366
Warrant liability (Public Warrants)		646,428
Warrant liability (Private Warrants)		21,557
Total liabilities measured at fair value	$	8,626,779

	·	Growth within existing government customers. While we currently have a strong footprint across multiple large U.S. government agencies, growing our business within these agencies outside of the investigation focused departments is a fundamental area of our projected growth. Our ability to expand our footprint by implementing AI based solutions that leverage our core existing competencies within the agencies will be a critical indicator of the success of this strategy. We will measure progress against this objective through the disclosure of awards for new business within these agencies during the affected timeframe, providing tangible evidence of the success of our strategy to both management and investors alike.

	·	Greater penetration into the commercial marketplace. While we have several existing customers in the commercial marketplace, our ability to build on the solutions we provide those customers and expand that base will be critical to our projected growth objectives. We will measure progress against this objective through the disclosure of the number of new commercial customers added during the affected timeframe, providing tangible evidence of the success of our strategy to both management and investors alike.

	·	Expansion of our edge AI based solutions. We began to sell AI based solutions in late 2022. Our current strategy is highly focused on the transition of data management and analysis workloads to the edge, driving efficiency and cost savings for our customers. This strategy also includes new models being trained to extract data at the edge which enables real-time intelligent decision making for our customers. We will measure progress against this objective through the disclosure of the numbers of edge AI hardware devices we are selling as well as the growth of our edge AI analytic capabilities, providing tangible evidence of the success of our strategy to both management and investors alike.

	·	Increase in the sales of lower margin solutions as we expand our operational footprint. While our current focus remains on expanding our AI driven software application portfolio, opportunities will continue to present themselves to provide those software-based solutions as part of a larger hardware-based turn-key solutions where Airship AI can provide a unique value-add to the customer. While these solutions will positively affect revenue we anticipate our operating profits in future periods may be adversely affected as compared to previous years due to the lower operating margin for hardware versus software applications.

	·	Challenges due to geo-political driven supply-chain constraints. While many of the COVID-19 driven supply chain issues have been resolved, challenges to the timely production and delivery of Taiwan based products we utilize for our edge AI platform due to geo-political factors is a concern looking forward. In the event that our suppliers are unable to provide timely delivery of those supplies it will significantly impact our ability to meet delivery schedules for existing and anticipated edge AI hardware-based solutions.

	·	Near-term impacts due to merger and acquisition activity. If Airship AI merges with or acquires another company, it is reasonably expected that there will be increased operating expenses and costs associated with the merger that could negatively impact operating profits in the future periods immediately following the M&A event. The extent and longevity of those impacts is not possible to quantify.

	Three Months Ended March 31,
	2024			2023			$ Variance			% Variance

Net revenues	$	10,575		$	2,939		$	7,636			259.8	%
Cost of net revenues		7,947			2,135			(5,812	)		-272.2	%
Gross profit		2,628			804			1,824			226.9	%
Research and development expenses		695			674			(21	)		-3.1	%
Selling, general and administrative expenses		3,335			1,832			(1,503	)		-82.0	%
Total operating expenses		4,030			2,506			(1,524	)		-60.8	%
Operating loss		(1,402	)		(1,702	)		300			17.6	%
Other income (expense):
Loss from change in fair value of warrants		(6,847	)		-			(6,847	)		-100.0	%
Loss from change in fair value of earnout liability		(21,485	)		-			(21,485	)		-100.0	%
Loss from change in fair value of convertible debt		(2,039	)		-			(2,039	)		-100.0	%
Loss on note conversion		(159	)		-			(159	)		-100.0	%
Interest expense		(32	)		(5	)		(27	)		-540.0	%
Other expense		-			(5	)		5			100.0	%
Total other expense, net		(30,562	)		(10	)		(30,552	)		305520.0	%
Loss before income taxes		(31,964	)		(1,712	)		(30,252	)		-1767.1	%
Income tax benefit (expense)		-			-			-			-
Net loss	$	(31,964	)	$	(1,712	)	$	(30,252	)		-1767.1	%

	Year Ended December 31,
	2023			2022			$ Variance			% Variance

Net revenues	$	12,300		$	14,549		$	(2,249	)		-15.5	%
Cost of net revenues		6,536			6,128			(408	)		-6.7	%
Gross profit		5,764			8,421			(2,657	)		-31.6	%
Research and development expenses		2,729			3,615			886			24.5	%
Selling, general and administrative expenses		9,675			7,630			(2,045	)		-26.8	%
Total operating expenses		12,404			11,245			(1,159	)		-10.3	%
Operating loss		(6,640	)		(2,824	)		(3,816	)		-135.1	%
Other income (expense):
Gain from change in fair value of warrants		1,341			-			1,341			100.0	%
Gain from change in fair value of earnout liability		21,977			-			21,977			100.0	%
Loss from change in fair value of convertible debt		(241	)		-			(241	)		-100.0	%
Interest income		-			43			(43	)		-100.0	%
Interest expense		(56	)		(75	)		19			25.3	%
Other expense		(10	)		-			(10	)		-100.0	%
Other income- PPP loan forgiveness		-			1,146			(1,146	)		-100.0	%
Other income- Employee retention tax credit		-			1,233			(1,233	)		-100.0	%
Total other income, net		23,011			2,347			20,664			880.4	%
Income (loss) before income taxes		16,371			(477	)		16,848			3532.1	%
Income tax benefit (expense)		-			(10	)		10			100.0	%
Net income (loss)	$	16,371		$	(487	)	$	16,858			3461.3	%

			Less Than
Contractual Cash Obligations	Total		1 Year		1-3 Years		4-5 Years
Operating lease cash payments	$	1,382,081	$	424,158	$	735,332	$	222,591

	·	Structure data and analyze it in real-time,

	·	Extract value from the analyzed data in real-time,

	·	Securely transmit the usable data to the consumers who need it in real-time, and

	·	Securely retain all data at the edge for regulatory/evidentiary purposes.

	·	Acropolis Commercial. We built this platform first, supporting a variety of small and medium businesses across various commercial verticals, including schools, hospitals, casinos, logistics, and retail establishments. Our growth led us to larger commercial entities where we branched out from a standalone platform managing small numbers of cameras to an enterprise platform capable of managing hundreds of thousands of cameras and users from a single graphical user interface. Acropolis Commercial continues to support our commercial customers’ requirements today.

	·	Acropolis Law. We built this platform based on the success of our commercial offering and we have grown our customer base to include agencies across the law enforcement, defense, and intelligence sectors, with dozens of custom sensor integrations and unique workflows allowing agencies to break down data sharing silos when operating standalone or in joint interagency environments.

	·	Single Pane of Glass Platform: Our platform brings together disparate edge generated data into one place, structured and unstructured, allowing our customers the ability to visualize multiple analyzed data forms in a true “single pane of glass.” This approach substantially reduces the infrastructure, human and physical, that has been historically needed to view and extract operational value from the customers’ data.

	·	Superior Customer Experience: Our direct approach to customer engagements enables our team to manage the entire customer experience, starting with the first platform demonstration and continuing through installation and long-term employment. This is key to our goal to build partnerships with our customers, which we equate to potential long-term recurring revenue engagements with strong opportunities for expansion within the organization.

	·	Ease of Use and Adoption: Our solution is architected such that it can be installed in as little as one hour with minimal direct engagement or support needed, yet ready to support operational engagements of a handful of users and devices to thousands of users and tens of thousands of attached devices. Everything within the architecture is purpose built to be intuitive and straightforward, allowing users to become operationally proficient in short order with limited training.

	·	Hardened and Secure Platform: As a U.S. owned and operated company, our offerings are compliant with the National Defense Authorization Act (“NDAA”), the Commercial Software and the Trade Agreements Act (“TAA”), and the Buy American Act. Thus, cybersecurity and safeguarding data at rest and in transit is factored into everything we do, resulting in our platform having been accredited with numerous Authorities to Operate (“ATO”) for U.S. government agencies for on-premise deployments as well at the Fed Ramp high impact level in the secure cloud. This allows us to bring government-grade security to the larger commercial sector.

	·	Significant Cost Savings: Our edge solution enables customers to add AI capabilities to their existing IT infrastructure, allowing them to immediately recognize the operational benefits of our AI platform without having to add expensive backend servers. Additionally, our open approach to edge sensors and devices allows customers to extract the full value out of their existing devices compared to the more common industry standard rip and replace approach.

	·	Embrace Existing Direct Routes to Market While Building A Channel Program: Our focus in the near term is to continue building and expanding relationships with existing customers who we enjoy direct relationships with, while we build partnerships with global integrators who bring capabilities outside our core competencies along with access and placement to customers and verticals which we do not currently enjoy. We believe that these strategies can not only co-exist but be mutually beneficial.

	·	Expand Our Technology Partnerships and Integrations: Our focus remains on providing a best of breed “single pane of glass” solution for our customers data management challenges, which entails expanding our existing technology partnership ecosystem within our existing customer framework, as well as adjacent verticals. We believe this will drive new customer acquisitions as well as help expand our distribution capability into spaces our partners already participate.

	·	Commercial Expansion: Based on our existing lighthouse customers and the rapid acceleration of AI in solving public safety and operational challenges, we see significant opportunities for expansion of our platform in the broader commercial marketplace. While we see opportunities across multiple industry verticals, our focus in the short term will be on those verticals that can immediately benefit from the work already done, significantly reducing additional development efforts along with shortening the sales cycle. These verticals include infrastructure, transportation, logistics, and retail.

	·	Strategic M&A Activities: As part of our commercial landing and government expansion strategies, we plan to focus on strategic acquisition targets with complementary technologies that can rapidly accelerate existing development efforts or add new capabilities to our platform that are supportive of our existing technology partnerships and routes to market strategies.

Name	Age	Position
Victor Huang	55	Chief Executive Officer, Chairman of the Board and Director
Derek Xu	67	Chief Operating Officer, Director, Secretary and Treasurer
Paul Allen	54	President
Yanda Ma	45	Chief Technology Officer
Mark E. Scott	71	Chief Financial Officer
Peeyush Ranjan	50	Director
Louis Lebedin	66	Director
Amit Mital	54	Director

	·	appointing the independent auditors and pre-approving all auditing and non-auditing services permitted to be performed by the independent auditors;

	·	reviewing with the independent auditors any audit problems or difficulties and management’s response;

	·	discussing the annual audited financial statements with management and the independent auditors;

	·	reviewing the adequacy and effectiveness of our accounting and internal control policies and procedures and any steps taken to monitor and control major financial risk exposures;

	·	reviewing and approving all proposed related party transactions as defined by applicable law or Nasdaq listing requirements;

	·	meeting separately and periodically with management and the independent auditors; and

	·	monitoring compliance with our code of business conduct and ethics, including reviewing the adequacy and effectiveness of our procedures to ensure proper compliance.

	·	reviewing and approving the corporate goals and objectives applicable to the compensation of the chief executive officer, evaluating the chief executive officer’s performance, and determining and approving the chief executive officer’s compensation level based on this evaluation;

	·	reviewing and approving the compensation of all other Executive Officers;

	·	reviewing, approving and recommending incentive compensation plans and equity-based plans to the Board and stockholders of the Company for approval, and administering the Company’s incentive compensation plans, equity-based plans and the clawback policy;

	·	reviewing, approving and recommending employment agreements and severance arrangements or plans to the Board for approval;

	·	reviewing all Director compensation and benefits for service on the Board and Board committees, and recommending any changes to the Board as necessary; and

	·	overseeing, in conjunction with the Nominating and Corporate Governance Committee, engagement with stockholders and proxy advisory firms on executive compensation matters.

	·	determining the qualifications, qualities, skills, and other expertise required to be a director, and developing and recommending to the Board the criteria to be considered in selecting director nominees for the Board’s approval;

	·	identifying and screening individuals qualified to become members of the Board, and considering any director candidates recommended by the Company’s stockholders;

	·	selecting and approving the director nominees to be submitted to a stockholder vote at the stockholders’ annual meeting, subject to approval by the Board;

	·	developing and recommending to the Board a set of corporate governance guidelines applicable to the Company, reviewing these principles and recommending any changes to the Board;

	·	overseeing the Company’s corporate governance practices and procedures, including identifying best practices, and reviewing and recommending to the Board for approval any changes to the documents, policies and procedures in the Company’s corporate governance framework;

	·	reviewing the Board’s committee structure and composition and to make recommendations to the Board annually regarding the appointment of directors to serve as members of each committee and committee chairmen;

	·	if a vacancy on the Board and/or any Board committee occurs, identifying and making recommendations to the Board regarding the selection and approval of candidates to fill such vacancy either by election by stockholders or appointment by the Board;

	·	developing and overseeing a Company orientation program for new Directors and a continuing education program for current Directors, periodically reviewing these programs and updating them as necessary;

	·	reviewing and discussing with management disclosure of the Company’s corporate governance practices;

	·	developing and recommending to the Board for approval an officer succession plan, to review such succession plan periodically with the chief executive officer, developing and evaluating potential candidates for executive positions, and recommending to the Board any changes to and any candidates for succession under the succession plan.