Company: XTIA
Filing Date: 2025-04-15
Form Type: 10-K
Source: 0001213900-25-032213
Chunk: 42

Company: XTI Aerospace, Inc.
Filing Date: 2025-04-15
Form: 10-K
Item: Item 1
Chunk 42
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 our business, financial condition, operating results and cash flows.

We
may be a party to claims that arise from time to time in the ordinary course of our business, which may include those related to, for
example, our securities offerings, contracts, sub-contracts, protection of confidential information or trade secrets, adversary proceedings
arising from customer bankruptcies, employment of our workforce and immigration requirements or compliance with any of a wide array of
state and federal statutes, rules and regulations that pertain to different aspects of our business.

Additionally, we are and we may be made a party to future claims relating
to the XTI Merger. On December 6, 2023, Xeriant, Inc. (“Xeriant”) filed a complaint against Legacy XTI, along with two unnamed
companies and five unnamed persons, in the United States District Court for the Southern District of New York. On January 31, 2024, Xeriant
filed an amended complaint, which added us as a defendant. On February 2, 2024, the Court ordered Xeriant to show cause as to why the
amended complaint should not be dismissed without prejudice for lack of subject matter jurisdiction. On February 29, 2024, Xeriant filed
a second amended complaint, which removed us and one of the unnamed companies as defendants. The second amended complaint alleges that
Legacy XTI, through multiple breaches and fraudulent actions, has caused substantial harm to Xeriant and has prevented it from obtaining
compensation owed to it under various agreements entered into between Xeriant and Legacy XTI, including but not limited to a joint venture
agreement, a cross-patent license agreement, an operating agreement, and a letter dated May 17, 2022 (the “May 17 letter”)
arising from Xeriant’s introducing Legacy XTI to a Nasdaq listed company as a potential acquirer of Legacy XTI. In particular, Xeriant
contends that Legacy XTI gained substantial advantages from the intellectual property, expertise, and capital deployed by Xeriant in the
design and development of Legacy XTI’s TriFan 600 airplane yet has excluded Xeriant from the transaction involving the TriFan 600
technology in its merger with us, which has resulted in a breach of the May 17 letter, in addition to the other aforementioned agreements.
Xeriant, in the second amended complaint, asserts the following causes of action: (1