Company: XTIA
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001213900-25-076767
Chunk: 55

Company: XTI Aerospace, Inc.
Filing Date: 2025-08-14
Form: 10-Q
Item: Part I, Item 1
Chunk 55
---
 against Legacy XTI, two unnamed entities,
and five unnamed individuals. On January 31, 2024, Xeriant filed an amended complaint adding the Company as a defendant. On February 29,
2024, Xeriant filed a second amended complaint, removing the Company and one of the unnamed entities as defendants. The second amended
complaint alleges that Legacy XTI breached several agreements with Xeriant, including a Joint Venture Agreement dated May 31, 2021, a
cross-patent license agreement, an operating agreement, and a letter dated May 17, 2022, which Xeriant claims arose from its introduction
of Legacy XTI to a Nasdaq-listed company as a potential acquirer.

Xeriant alleges that it provided intellectual
property, expertise, and capital in connection with Legacy XTI’s TriFan 600 aircraft and that it was improperly excluded from a
subsequent transaction involving the TriFan 600 technology as part of Legacy XTI’s merger with the Company. Xeriant asserts causes
of action including breach of contract, fraud, unjust enrichment, and misappropriation of confidential information. It seeks damages in
excess of $500 million, injunctive relief, a royalty obligation, and other equitable relief.

On March 13, 2024, Legacy XTI moved to dismiss
portions of the second amended complaint. The Court denied that motion on January 14, 2025. Legacy XTI filed an answer on January 28,
2025, and subsequently filed an amended answer and counterclaims on February 18, 2025. The amended counterclaims, further amended on April
14, 2025, allege that Xeriant breached the Joint Venture Agreement by failing to make required capital contributions of approximately
$4.6 million and by failing to deliver promised intellectual property and strategic support. Legacy XTI further alleges that Xeriant breached
its fiduciary duty by engaging in coercive and self-dealing conduct, including conditioning a strategic introduction on the issuance of
equity and assumption of debt. Legacy XTI seeks declaratory relief confirming that the joint venture has been terminated, that all intellectual
property related to the TriFan 600 belongs solely to Legacy XTI, and that Xeriant has no rights in the TriFan 600 technology.

33

XTI AEROSPACE, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS