Company: XTIA
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001213900-25-076767
Chunk: 322

Company: XTI Aerospace, Inc.
Filing Date: 2025-08-14
Form: 10-Q
Item: Part I, Item 3
Chunk 322
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: (i) an extension of all discovery
deadlines by three months, through November 24, 2025; (ii) an extension of expert discovery through February 16, 2026; and (iii) that
the parties finalize a protective order and Electronically Stored Information (“ESI”) protocol by July 25, 2025. The parties
subsequently submitted a stipulated protective order and ESI protocol, which the Court entered on July 28, 2025. The parties are continuing
to exchange written discovery and will be conducting depositions.  The litigation remains in the early stages of discovery. The Company
believes the claims against Legacy XTI are without merit and intends to continue to vigorously defend against them. At this time, the
Company is unable to predict the outcome of this matter or estimate the likelihood or magnitude of a potential loss, if any.

51

In connection with the litigation matter described in the immediately
preceding paragraph, on June 12, 2024, the Company received correspondence from legal counsel for Auctus Fund, LLC (“Auctus”),
dated April 3, 2024, asserting that the Company and/or Legacy XTI may have assumed Xeriant’s obligations under a Senior Secured
Promissory Note (the “Note”) issued by Xeriant to Auctus in the original principal amount of $6,050,000, pursuant to a letter
agreement dated May 17, 2022, between Xeriant and Legacy XTI  (the “May 17 letter”). Auctus claimed that the outstanding
amount due under the Note, including accrued interest, was $8,435,008.81 as of April 3, 2024. In July 2024, Legacy XTI responded to Auctus’s
claims, asserting that the May 17 letter is invalid and unenforceable on multiple grounds. Legacy XTI further stated that, even if the
May 17 letter were enforceable, it did not create or trigger any obligation for Legacy XTI to assume Xeriant’s debt under the Note
or otherwise. On May 13, 2025, Auctus filed a lawsuit against Legacy XTI in the District Court of Arapahoe County, Colorado, asserting
a single claim for breach of contract based on its prior allegations. Auctus contends that Legacy XTI is contractually obligated to repay
nearly $9 million in principal