Company: XTIA
Filing Date: 2025-04-15
Form Type: 10-K
Source: 0001213900-25-032213
Chunk: 144

Company: XTI Aerospace, Inc.
Filing Date: 2025-04-15
Form: 10-K
Item: Item 1
Chunk 144
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MENTS
FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023

Amendment
to Series 9 Preferred Stock

The
Certificate of Amendment to Designations of Preferences and Rights of Series 9 Preferred Stock (the “Certificate of Amendment”)
allows the Company to pay the holders of Series 9 Preferred Stock, if such holders agree, with securities or other property of the Company
in an amount equal to the Series 9 Preferred Liquidation Amount (as defined in the Series 9 Preferred Stock Certificate of Designation)
in the event the Company elects to redeem all of any portion of the Series 9 Preferred Stock then issued and outstanding (a “Corporation
Optional Redemption”). Previously, the Company was to pay any such amount in only cash. The Certificate of Amendment also now provides
that the Company will provide notice of a Corporation Optional Redemption to the holders of Series 9 Preferred Stock within five business
days prior to the consummation of such redemption rather than five business days following the determination of the Company’s
board of directors to consummate such redemption. In addition, the Certificate of Amendment eliminates the requirement for the Company
to obtain the written consent of the holders of at least a majority of the outstanding Series 9 Preferred Stock before repaying any outstanding
indebtedness owed to any holder of Series 9 Preferred Stock or its affiliates. The Company evaluated the amendment and accounted for
it as a modification, which requires the Company to recognize any increase in fair value as an expense. However, the Company concluded
the increase in the fair value of the Series 9 Preferred Stock from immediately before to immediately after the amendment is immaterial.

Series
9 Preferred Stock Exchanges

From
April through December 31, 2024, the Company entered into exchange agreements with the holder of shares of the Company’s Series
9 Preferred Stock pursuant to which the Company and the holder agreed to exchange 9,790 shares of Series 9 Preferred Stock with an aggregate
stated value of $10,279,500 (the “Preferred Shares”) for 441,391 shares of common stock (the “Preferred Exchange Shares”)
at an effective price per share ranging from $10.00 to $740.00.

The
Company issued the Preferred Exchange Shares to the holder, at which time the Preferred Shares were cancelled. The Preferred Exchange
Shares were issued in reliance on the exemption from registration provided by Section 3(a)(9) of the Securities