Company: XTIA
Filing Date: 2025-06-03
Form Type: DRS
Source: 0001213900-25-050156
Chunk: 52

Company: XTI Aerospace, Inc.
Filing Date: 2025-06-03
Form: DRS
Chunk 52
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 of this offering.

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Price Stabilization, Short Positions and Penalty Bids

In connection with this Offering,
the underwriters may engage in transactions that stabilize, maintain or otherwise affect the price of our common stock. Specifically,
the underwriters may over-allot in connection with this Offering by selling more shares than are set forth on the cover page of this prospectus.
This creates a short position in our common stock for its own account. The short position may be either a covered short position or a
naked short position. In a covered short position, the number of shares of common stock over-allotted by the underwriters is not greater
than the number of shares of common stock that they may purchase in the over-allotment option. In a naked short position, the number of
shares of common stock involved is greater than the number of shares of common stock in the over-allotment option. To close out a short
position, the underwriters may elect to exercise all or part of the over-allotment option. The underwriters may also elect to stabilize
the price of our common stock or reduce any short position by bidding for, and purchasing, common stock in the open market.

The underwriters may also
impose a penalty bid. This occurs when a particular underwriter or dealer repays selling concessions allowed to it for distributing shares
of common stock in this Offering because the underwriter repurchases the shares of common stock in stabilizing or short covering transactions.

Finally, the underwriters
may bid for, and purchase, shares of our common stock in market making transactions, including “passive” market making transactions
as described below.

These activities may stabilize
or maintain the market price of our common stock at a price that is higher than the price that might otherwise exist in the absence of
these activities. The underwriters are not required to engage in these activities, and may discontinue any of these activities at any
time without notice. These transactions may be effected on the national securities exchange on which our shares of common stock are traded,
in the over-the-counter market, or otherwise.

Indemnification

We have agreed to indemnify
the underwriters against liabilities relating to this Offering arising under the Securities Act and the Exchange Act, liabilities arising
from breaches of some, or all of the representations and warranties contained in the underwriting agreement, and to contribute to payments
that the underwriters may be required to make for these liabilities.

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