Company: XTIA
Filing Date: 2025-06-25
Form Type: 424B4
Source: 0001213900-25-057901
Chunk: 23

Company: XTI Aerospace, Inc.
Filing Date: 2025-06-25
Form: 424B4
Chunk 23
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”) before FINRA against the
Company and its subsidiary, XTI Aircraft Company (“Aircraft”). Aircraft and Chardan are parties to an engagement letter agreement
(the “Agreement”). In the Arbitration, Chardan originally alleged that the Company was bound by the Agreement even though
it did not sign the Agreement, which the Company denied. Chardan further alleged that Aircraft and the Company breached the Agreement
by not making separate payments to Chardan of $200,000, $94,511, $484,044.40 and $174,000. Chardan also sought to recover unspecified
amounts relating to an alleged right of first refusal to perform banking services (the “ROFR”) that the Company supposedly
did not honor, including with respect to an At-The-Market securities offering that was underwritten by The Maxim Group LLC (the “ATM”).
The Company filed a petition in the U.S. District Court for the Southern District of New York (the “Court”) seeking to stay
the Arbitration to the extent that it was asserted against the Company. On or about January 21, 2025, the Court entered a final judgment
that: (a) enjoins Chardan from prosecuting the Arbitration against the Company; and (b) declares that the Company has no contractual or
other duty to arbitrate with Chardan.

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On April 30, 2025, Chardan
amended its Statement of Claim in the Arbitration. The Amended Statement of Claim (“ASOC”) is asserted solely against Aircraft.
Thus, the Company no longer is a respondent in the Arbitration. Through the ASOC, Chardan now asserts claims against Aircraft for breach
of contract and unjust enrichment. It seeks to recover: (a) a $200,000 cash payment that Aircraft supposedly was required to, but did
not, make; (b) approximately $134,000 in damages, for supposedly issuing 189,037 shares of the Company’s common stock to Chardan
on March 19, 2024 instead of 208,113 shares; and (c) all payments supposedly due to Chardan under the ROFR, which Chardan states continue
to accumulate. According to Chardan, amounts due under the ROFR include 30% of any banking fees paid with respect to at least the following
acts of the Company: (i) the entry into an