Company: XTIA
Filing Date: 2025-04-15
Form Type: 10-K
Source: 0001213900-25-032213
Chunk: 313

Company: XTI Aerospace, Inc.
Filing Date: 2025-04-15
Form: 10-K
Item: Item 2
Chunk 313
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 the modifications of certain Legacy XTI convertible notes.
On November 1, 2023, Legacy XTI and certain convertible noteholders agreed to amend the convertible notes to extend the maturity date
and to revise the conversion terms. The amendment to the convertible notes was accounted for as an extinguishment of debt and reissuance
of the convertible notes in accordance with ASC 470-50, Debt – Modifications and Extinguishments, due to the addition
of a substantive conversion feature. As Legacy XTI elected to account for these convertible notes using the fair value option, Legacy
XTI measured the convertible notes at a fair value, which resulted in a loss on extinguishment of approximately $6.6 million. As of December
31, 2023, Legacy XTI re-measured the convertible notes at fair value resulting in the convertible notes balance being increased by $9.1
million, and therefore an additional loss being recognized of $9.1 million.

Provision
for Income Taxes

There
was an income tax provision of approximately $0.02 million for the year ended December 31, 2024 compared to an income
tax benefit of $0.0 for the comparable period in the prior year. The income tax provision for the year ended December 31, 2024 is
attributable to minimum state income taxes.

47

Liquidity
and Capital Resources as of December 31, 2024

Our
current capital resources and operating results as of and through December 31, 2024, consist of:

1.an
                                            overall working capital deficit of approximately $8.8 million;

2.cash
                                            of approximately $4.1 million;

 3.net cash used by operating activities for the year ended December 31,
2024 of approximately $22.3 million.

The
breakdown of our overall working capital deficit is as follows (in thousands):

    Working
    Capital 
    Assets  
    Liabilities  
    Net 
  
    Cash and
    cash equivalents 
    $4,105  
    $—  
    $4,105 
  
    Accounts receivable,
    net / accounts and related party payables 
     706  
     5,538  
     (4,832)
  
    Prepaid expenses and
    other current assets 
     1,018  
     —  
     1,018