Company: XTIA
Filing Date: 2025-04-15
Form Type: 10-K
Source: 0001213900-25-032213
Chunk: 28

Company: XTI Aerospace, Inc.
Filing Date: 2025-04-15
Form: 10-K
Item: Item 1
Chunk 28
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, or capacity constraints
affecting, shipping and logistics. Such suppliers may be subject to additional risks such as financial problems that limit their ability
to conduct their operations. If any of these third parties experience difficulties, it may have a direct negative impact on us.

While
we believe that we may be able to establish alternate supply relationships and can obtain replacement components, we may be unable to
do so in the short term or at all at prices that are acceptable to us or may need to recertify components. We may experience source disruptions
in our or our partners’ supply chains, which may cause delays in our overall production process for both prototype and commercial
production aircraft.

If
we needed to find alternative suppliers for any of the key components of our aircraft, then this could increase our costs and adversely
affect our ability to receive such components on a timely basis, or at all, which could cause significant delays in our overall projected
timelines for the delivery of our aircraft and adversely affect our relationships with our customers.

In
addition, if we experience a significant increase in demand, or need to replace our existing suppliers, there can be no assurance that
additional suppliers of component parts will be available when required on terms that are acceptable to us, or at all, or that any supplier
would allocate sufficient supplies to us in order to meet our requirements or fill our orders in a timely manner. Further, if we are
unable to manage successfully our relationships with all of our suppliers and partners, the quality and availability of our aircraft
may be harmed. Our suppliers or partners could, under some circumstances, decline to accept new purchase orders from, or otherwise reduce
their business with, us. Any disruptions in the supply of components from our suppliers and partners could lead to delays in aircraft
production, which would materially adversely affect our business, financial condition and operating results.

Further,
if any conflicts arise between our suppliers or partners and us, the other party may act in a manner adverse to us and could limit our
ability to implement our business strategies, which could impact our projected production timelines and number of aircraft produced.
Our suppliers or partners may also develop, either alone or with others, products in related fields that are competitive with our products
as a result of any conflicts or disagreements. Any disagreements or conflicts with our suppliers or partners could have an adverse effect
on our reputation, which could also negatively impact our ability to source new suppliers or partners.

16

Any
changes in business conditions, wars, governmental changes,