Company: XTIA
Filing Date: 2025-05-19
Form Type: 10-Q
Source: 0001213900-25-045396
Chunk: 226

Company: XTI Aerospace, Inc.
Filing Date: 2025-05-19
Form: 10-Q
Item: Part I, Item 2
Chunk 226
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, asserts the following causes of action: (1) breach of
contract; (2) intentional fraud; (3) fraudulent concealment; (4) quantum meruit; (5) unjust enrichment; (6) unfair competition/deceptive
business practices; and (7) misappropriation of confidential information, and seeks damages in excess of $500 million, injunctive relief
enjoining us from engaging in any further misconduct, the imposition of a royalty obligation, and such other relief as deemed appropriate
by the court. On March 13, 2024, Legacy XTI moved for partial dismissal of the second amended complaint. On January 14, 2025, the Court
denied Legacy XTI’s motion to dismiss the complaint. On January 28, 2025, Legacy XTI filed an answer to the second amended complaint.
On January 28, 2025, Legacy XTI filed an amended answer and counterclaims against Xeriant. The counterclaims assert that Xeriant (1) breached
the joint venture agreement by failing to pay $4,600,000 to fund development of the TriFan 600 technology, and (2) breached its fiduciary
duty to XTI by engaging in bad faith, coercion, and self-dealing, including by appropriating material information for its own use and
concealing from Legacy XTI the identity of a potential strategic partner. On March 18, 2025, Xeriant moved for dismissal of Legacy XTI’s
counterclaims. The case is in its early stages of discovery, and we are unable to estimate the likelihood or magnitude of a potential
adverse judgment. Legacy XTI nevertheless denies the allegations of wrongdoing contained in the second amended complaint and is vigorously
defending against the lawsuit.

50

In connection with the litigation
matter described in the immediately preceding paragraph, on June 12, 2024, we received a letter from counsel for Auctus Fund, LLC (“Auctus”),
dated April 3, 2024, claiming that, pursuant to the above-referenced May 17 letter by and between Xeriant and Legacy XTI, as a result
of the XTI Merger and Legacy XTI’s entry into a promissory note agreement with Legacy Inpixon in March 2023, XTI Aerospace and Legacy
XTI may have assumed Xeriant’s obligations under that certain Senior Secured Promissory Note in the principal amount of