Company: XTIA
Filing Date: 2025-05-19
Form Type: 10-Q
Source: 0001213900-25-045396
Chunk: 26

Company: XTI Aerospace, Inc.
Filing Date: 2025-05-19
Form: 10-Q
Item: Part I, Item 1
Chunk 26
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2 million and $0.4 million for the three months ended March 31, 2025 and 2024, respectively.

Streeterville Debt Exchanges and Repayment

During the three months ended March 31, 2025,
the Company issued an aggregate of 240,229 shares of common stock (the “Exchange Shares”) to Streeterville Capital, LLC (“Streeterville”),
the holder of that certain outstanding secured promissory note of the Company issued on May 1, 2024 (the “Original Note”),
at a price between $2.48 and $4.21 per share, in each case equal to the Minimum Price as defined in Nasdaq Listing Rule 5635(d) in accordance
with the terms and conditions of certain exchange agreements, pursuant to which the Company and Streeterville agreed to (i) partition
new secured promissory notes in the form of the Original Note in the aggregate original principal amount of $750,000 and then cause the
outstanding balance of the Original Note to be reduced by an aggregate of $750,000; and (ii) exchange the partitioned notes for the delivery
of the Exchange Shares.

On March 31, 2025 and using the net proceeds from
the March Offering (see “March 2025 Public Offering” disclosure in Note 10), the Company repaid the remaining obligation
of approximately $2.7 million (which included principal, accrued interest and monitoring fees, and a 15% prepayment penalty) in respect
of the two secured promissory notes issued by the Company to Streeterville on May 1, 2024 and May 24, 2024. As a result of the repayments,
Streeterville released its security interest in the stock the Company owns in Legacy XTI and the assets owned by Legacy XTI. Due to the
repayment of the promissory notes occurring before the maturity date, the Company incurred a loss on extinguishment of debt of approximately
$0.4 million, which is reported within other (expense) income on the condensed consolidated statements of operations.

21

XTI AEROSPACE, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 10 - Common Stock

Capital Raises

At-the-Market (ATM) Offering Program

The Company was able, from time to time, to sell
shares of the Company’s common stock under its “at-the-market