Company: XTIA
Filing Date: 2025-05-19
Form Type: 10-Q
Source: 0001213900-25-045396
Chunk: 20

Company: XTI Aerospace, Inc.
Filing Date: 2025-05-19
Form: 10-Q
Item: Part I, Item 1
Chunk 20
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pixon’s common stock on March 12, 2024 of $5.27 (which reflects the 1-for-100 reverse stock split of the
Company’s outstanding common stock that became effective before the closing of the XTI Merger). The Company utilized Legacy Inpixon’s
common stock price in determining fair value as it is more reliably measurable than the value of Legacy XTI’s (accounting acquirer)
equity interests given it is not a publicly traded entity.

The aggregate fair value of warrants was approximately
$3.3 million was included in the total equity consideration. A portion of this total represents 918,689 warrants outstanding by the Company
with a fair value of $1.00 per warrant, which is the warrant’s redemption value. The warrant fair value was determined to be the
redemption value as the warrants include protective covenants for the Company that prevent the holder from exercising the warrants. The
remainder of this total represents 491,310 warrants with a fair value of $4.75 per warrant, which was determined by using level 3 inputs
and utilizing a Black-Scholes valuation. Significant inputs related to these warrants are as follows:

    Fair value of common stock 
    $5.27 
  
    Exercise price 
    $5.13 
  
    Expected term 
     4.76 years 
  
    Volatility 
     146%
  
    Risk-free interest rate 
     4.2%
  
    Dividend yield 
     —%

16

XTI AEROSPACE, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The fair value of preferred stock of approximately
$11.3 million included in the total equity consideration represents 11,302 shares of Series 9 Preferred Stock that were issued and outstanding
by the Company upon the consummation of the XTI Merger at a stated value and fair value of $1,000 per share.

The following table summarizes the purchase price allocations relating to the XTI Merger (in thousands):

    Assets acquired 

    Cash and cash equivalents 
    $2,968 
  
    Accounts receivable 
     696 
  
    Notes and other receivables 
     7,929 
  
    Inventory 
     3,283 
  
    Prepaid assets and other current assets 
     756 
  
    Property and equipment 
     246 
  
    Other assets