Company: XTIA
Filing Date: 2025-04-15
Form Type: 10-K
Source: 0001213900-25-032213
Chunk: 593

Company: XTI Aerospace, Inc.
Filing Date: 2025-04-15
Form: 10-K
Item: Item 8
Chunk 593
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 Amendment modifies the vesting criteria with respect to the shares
of common stock underlying the warrant issued by the Company to Mesa pursuant to the conditional aircraft purchase contract described
below. As amended by the Warrant Amendment, (i) one-third or 757 warrant shares vested upon the execution and delivery of the conditional
aircraft purchase contract, dated February 2, 2022, by and between the Company and Mesa, relating to the purchase of 100 TriFan 600 airplane,
(ii) one-sixth or 378 of the warrant shares vested on March 12, 2024 in which the Company recorded $0.5 million of stock-based compensation
expense for the year ended December 31, 2024, (iii) one-sixth or 378 unvested warrant shares lapsed on March 12, 2024, and (iv) one-third
or 757 warrant shares will vest upon the acceptance of delivery and final purchase of the first TriFan 600 airplane by Mesa pursuant
to the Aircraft Purchase Agreement. On March 12, 2024 and per a warrant exercise letter agreement, all vested warrants shares were net
exercised into shares of Legacy XTI common stock immediately prior to the XTI Merger closing time, which resulted in the issuance of 1,135 shares
of the Company’s common stock.

To
induce warrant holders to exercise warrant shares, Legacy XTI entered into exercise letter agreements with several warrant holders in
February 2024 at reduced exercise prices from the original warrant agreements. The net impact of these warrant inducements to the condensed
consolidated statement of operations was not material. In total, 423 warrant shares (adjusted for the merger exchange) were net
exercised into shares of Legacy XTI common stock immediately prior to the XTI Merger closing time, which resulted in the issuance of
423 shares of the Company’s common stock.

During
the second quarter of 2024, an additional 82 warrant shares originally issued by Legacy XTI were exercised into 82 shares of
the Company’s common stock at an exercise price of $30.00.

Warrant
Exchanges

On
April 30, 2024 and May 1, 2024, the Company entered into warrant exchange agreements with the holders of certain of our then outstanding
warrants (the “Existing Warrants”) initially issued on May 17, 2023. Pursuant to the terms