Company: XTIA
Filing Date: 2025-04-15
Form Type: 10-K
Source: 0001213900-25-032213
Chunk: 135

Company: XTI Aerospace, Inc.
Filing Date: 2025-04-15
Form: 10-K
Item: Item 1
Chunk 135
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 - 2021

During 2021, the Company entered into convertible
notes with a syndicate of investors. The notes had a combined principal amount of $2.5 million and accrued interest at a rate of 4.0%
per annum. As discussed in Note 10, pursuant to the terms of voluntary note conversion letter agreements, approximately $2.5 million
of the note’s outstanding principal balance and accrued interest were converted into shares of Legacy XTI common stock immediately
prior to the closing of the XTI Merger, which converted into shares of the Company’s common stock at the closing of the XTI Merger
on March 12, 2024. A repayment obligation remained after the XTI Merger closing with respect to approximately $0.05 million in principal,
which was repaid during the second quarter of 2024, and $0.25 million in accrued interest which remained outstanding as of December
31, 2024.

Promissory
Note - May 1, 2024

On
May 1, 2024 (the “Closing Date”), the Company entered into a note purchase agreement (the “Purchase Agreement”)
with Streeterville Capital, LLC (the “Holder”), pursuant to which the Company issued and sold to the Holder a secured promissory
note (the “Note”) in an initial principal amount of approximately $1.4 million, which is payable on or before the date
that is 12 months from the issuance date. The Purchase Agreement provides that, subject to the mutual consent of the Company
and the Holder, the Holder would purchase an additional secured promissory note on the date that is 30 days from the Closing
Date and another secured promissory note on the date that is 60 days from the Closing Date. The initial principal amount of
the Note includes an original issue discount of approximately $0.3 million. In exchange for the Note, the Holder paid an aggregate
purchase price to the Company of $1.0 million.

Interest
on the Note accrues at a rate of 10.0% per annum and is payable on the maturity date or otherwise in accordance with the Note. The
effective interest rate is 10.5%. If the Note is still outstanding on the date that is six months from the issuance date,
then a one-time monitoring fee equal to 10% of the then-current outstanding balance will be added to the outstanding