Company: XTIA
Filing Date: 2025-06-12
Form Type: S-1
Source: 0001213900-25-053928
Chunk: 21

Company: XTI Aerospace, Inc.
Filing Date: 2025-06-12
Form: S-1
Chunk 21
---
; (ii) a written agreement to transactions involving penny stocks;
and (iii) a signed and dated copy of a written suitability statement. These disclosure requirements may have the effect of reducing the
trading activity in the secondary market for our common stock, and therefore stockholders may have difficulty selling their shares.

Adverse judgments or settlements in legal proceedings could materially harm our business, financial condition, operating results and cash flows.

We may be a party to claims
that arise from time to time in the ordinary course of our business, which may include those related to, for example, our securities offerings,
contracts, sub-contracts, protection of confidential information or trade secrets, adversary proceedings arising from customer bankruptcies,
employment of our workforce and immigration requirements or compliance with any of a wide array of state and federal statutes, rules and
regulations that pertain to different aspects of our business.

Additionally, we are and we
may be made a party to future claims relating to the XTI Merger. On December 6, 2023, Xeriant, Inc. (“Xeriant”) filed a complaint
against Legacy XTI, along with two unnamed companies and five unnamed persons, in the United States District Court for the Southern District
of New York (the “Court”). On January 31, 2024, Xeriant filed an amended complaint, which added us as a defendant. On February
2, 2024, the Court ordered Xeriant to show cause as to why the amended complaint should not be dismissed without prejudice for lack of
subject matter jurisdiction. On February 29, 2024, Xeriant filed a second amended complaint, which removed us and one of the unnamed companies
as defendants. The second amended complaint alleges that Legacy XTI, through multiple breaches and fraudulent actions, has caused substantial
harm to Xeriant and has prevented it from obtaining compensation owed to it under various agreements entered into between Xeriant and
Legacy XTI, including but not limited to a joint venture agreement dated May 31, 2021 (the “Joint Venture Agreement”), a cross-patent
license agreement, an operating agreement, and a letter dated May 17, 2022 (the “May 17 letter”) arising from Xeriant’s
introducing Legacy XTI to a Nasdaq listed company as a potential acquirer of Legacy XTI. In particular, Xeriant contends that Legacy XTI
gained substantial advantages from the intellectual property, expertise and