Company: XTIA
Filing Date: 2025-11-19
Form Type: 10-Q
Source: 0001213900-25-112615
Chunk: 412

Company: XTI Aerospace, Inc.
Filing Date: 2025-11-19
Form: 10-Q
Item: Part I, Item 3
Chunk 412
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 the risks associated with the acquisitions. We have secured indemnification for certain matters in connection
with the Drone Nerds and Anzu Robotics acquisitions in order to mitigate the consequences of breaches of representations, warranties and
covenants under the applicable acquisition agreements and the risks associated with historic operations, including those with respect
to compliance with laws, accuracy of financial statements, financial reporting controls and procedures, tax matters and undisclosed liabilities,
and certain matters known to us. We believe that the indemnification provisions of the acquisition agreements, together with insurance
policies that we have in place will limit the economic consequences of the issues we have identified in our due diligence to acceptable
levels. Notwithstanding our exercise of due diligence and risk mitigation strategies, the Drone Nerds and Anzu Robotics acquisitions may
expose us to unanticipated risks or unknown or contingent liabilities and the costs associated with these risks or liabilities may be
greater than we anticipate. We may not be able to contain or control the costs associated with unanticipated risks or liabilities, which
could materially and adversely affect our business, liquidity, capital resources or results of operations.

61

Item 2. Unregistered Sales of Equity Securities
and Use of Proceeds

a) Sales of Unregistered Securities

On February 1, 2025, the Company
entered into a public relations and branding agreement with a public relations firm (the “PR Firm”), pursuant to which the
Company agreed to issue the PR Firm, as partial compensation for public relations services, 25,000 unregistered shares of common stock
(the “PR Firm Shares”), subject to the approval of the Company’s board of directors (the “Board”). On March
7, 2025, the Company entered into an investor relations agreement with an investor relations firm (the “IR Firm”), pursuant
to which the Company agreed to issue the IR Firm, as partial compensation for investor relations services, 8,500 unregistered shares of
common stock (the “IR Firm Shares”), subject to the Board’s approval.

Following the Board’s
approval of the issuances of the PR Firm Shares and the IR Firm Shares, the Company issued the PR Firm Shares and the IR Firm Shares to
the PR Firm and the IR Firm, respectively, as of September 26, 2025. The PR Firm Shares and the IR Firm Shares were issued pursuant to
an exemption from registration provided by Section 4(a)(2) and/or Rule 506 of Regulation D of the Securities Act because such issuances
did not