Company: XTIA
Filing Date: 2025-04-15
Form Type: 10-K
Source: 0001213900-25-032213
Chunk: 45

Company: XTI Aerospace, Inc.
Filing Date: 2025-04-15
Form: 10-K
Item: Item 1
Chunk 45
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 enjoins Chardan from prosecuting the Arbitration against XTI Aerospace, Inc. and (b) declares that XTI Aerospace,
Inc. has no contractual or other duty to arbitrate with Chardan. Legacy XTI remains as a party to the arbitration and intends to defend
against the Arbitration vigorously.

23

Regardless
of the merits of any particular claim, responding to such actions could divert time, resources and management’s attention away
from our business operations, and we may incur significant expenses in defending these lawsuits or other similar lawsuits. The results
of litigation and other legal proceedings are inherently uncertain, and adverse judgments or settlements in some of these legal disputes
may result in adverse monetary damages, penalties or injunctive relief against us, which could have a material adverse effect on our
financial condition, operating results and cash flows. Any claims or litigation, even if fully indemnified or insured, could damage our
reputation and make it more difficult to compete effectively or to obtain adequate insurance in the future.

Furthermore,
while we maintain insurance for certain potential liabilities, such insurance does not cover all types and amounts of potential liabilities
and is subject to various exclusions as well as deductibles and caps on amounts of coverage. Even if we believe a claim is covered by
insurance, insurers may dispute our entitlement to coverage for a variety of potential reasons, which may affect the timing and, if the
insurers prevail, the amount of our available insurance coverage for a particular claim.

We
may also be required to initiate expensive litigation or other proceedings to protect our business interests. There is a risk that we
will not be successful or otherwise be able to satisfactorily resolve such claims or litigation. Litigation and other legal claims are
subject to inherent uncertainties. Those uncertainties include, but are not limited to, litigation costs and attorneys’ fees, unpredictable
judicial or jury decisions and the differing laws and judicial proclivities regarding damage awards among the states in which we operate.
Unexpected outcomes in such legal proceedings, or changes in management’s evaluation or predictions of the likely outcomes of such
proceedings, could have a material adverse effect on our business, financial condition, results of operations and cash flows. Our current
financial status may increase our default and litigation risks and may make us more financially vulnerable in the face of threatened
litigation.

The
loss of key personnel may adversely affect our operations.

Our success depends to a significant extent upon the operation, experience,
and continued services of our key personnel. While our