Company: XTIA
Filing Date: 2025-05-19
Form Type: 10-Q
Source: 0001213900-25-045396
Chunk: 161

Company: XTI Aerospace, Inc.
Filing Date: 2025-05-19
Form: 10-Q
Item: Part I, Item 8
Chunk 161
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4 that terminated on March 27, 2025 pursuant to the
Settlement Agreement, (v) an increase in the Industrial IoT segment’s general and administrative expenses of $0.6 million as
the results for the three months ended March 31, 2024 only reflect the activity of the segment since the closing of the XTI Merger
on March 12, 2024, and (vi) an aggregate increase of approximately $2.8 million due to (a) increases in legal and accounting fees
relating to capital raising activities during the first quarter of 2025, (b) increase in administrative headcount to support
operations growth, and (c) increases in public company-related professional fees as the 2024 historical results reflect the
operations of a private company, Legacy XTI, from January 1, 2024 through the March 12, 2024 closing date of the XTI Merger.

Other (Expense) Income

Other (expense) income for the three months ended March 31, 2025 was
a loss of $2.5 million compared to a gain of $6.3 million for the comparable period in the prior year.

The loss of $2.5 million for
the three months ended March 31, 2025 was primarily attributable to (i) $0.4 million loss on extinguishment of debt due to the full repayment
of the Streeterville promissory notes before the maturity date, and (ii) $2.0 million of financing costs incurred relating to the issuance
of warrants in connection with the March Offering.

The gain of $6.3 million for
the three months ended March 31, 2024 was primarily attributable to the Company recognizing a gain of approximately $12.9 million relating
to the remeasurement of convertible notes payable at fair value. This gain was partially offset by inducement losses on debt conversions
of approximately $6.7 million, which is included in “loss on extinguishment of debt” on the condensed consolidated statements
of operations.

Provision for Income Taxes

The provision for income tax
for the three months ended March 31, 2025 and 2024 was immaterial.

Liquidity and Capital Resources as of March 31, 2025

Our current capital resources
and operating results as of and through March 31, 2025, consist of:

1)working capital of approximately $12,000;

2)cash and