ENGLEWOOD, Colo. - XTI Aerospace, Inc. (NASDAQ: XTIA) today provided an update on the spin-off of its former subsidiary Grafiti Holding Inc. and the ensuing business combination with Damon Motors, Inc., a company known for its HyperSport electric motorcycle. The transaction, which is in the process of obtaining necessary regulatory approvals, is expected to be finalized in the coming months.
On December 27, 2023, XTI's board determined the holders of its capital stock and certain securities who would be entitled to the distribution of shares of Grafiti. These shares were transferred to a liquidating trust for the benefit of the securityholders on the record date. The shares are currently held by the trust and will be distributed upon the effectiveness of the registration statement filed with the Securities and Exchange Commission (SEC).
The distribution of the shares is contingent on the registration statement becoming effective. Moreover, the business combination hinges on several conditions, including approvals from Damon securityholders, the Supreme Court of British Columbia, and the Nasdaq Stock Market for the listing of the combined company's shares.
Once the business combination is completed, 80% of the distributed Grafiti shares will be subject to lock-up restrictions, with potential for earlier release if the shares reach a specified trading threshold on Nasdaq. The remaining capital stock of the combined company will be approximately 18.75% owned by Grafiti's current management and XTI's former management, as well as the record date securityholders.
XTI Aerospace, Inc. is the parent company of XTI Aircraft Company, which is developing the TriFan 600, a vertical takeoff and landing aircraft. Its Inpixon (NASDAQ:XTIA) business unit is a leader in Real-Time Location Systems (RTLS) technology.
Damon Motors, based in Vancouver, Canada, and San Rafael, California, is aiming to revolutionize urban mobility with its electric motorcycles, featuring proprietary technology and safety features.
Grafiti Holding, headquartered in the United Kingdom, provides data analytics and visualization solutions with applications in various scientific and engineering fields.
This press release contains forward-looking statements regarding the anticipated benefits and timing of the business combination. These statements are based on current expectations and are subject to risks and uncertainties that could cause actual results to differ materially. The completion of the business combination is not guaranteed and is dependent on several factors, including regulatory approvals and market conditions.
The information for this article is based on a press release statement from XTI Aerospace, Inc.
InvestingPro Insights
XTI Aerospace, Inc. (NASDAQ: XTIA) is navigating a complex financial landscape as it moves forward with its business combination plans. The latest real-time data from InvestingPro paints a picture of a company that's facing significant financial challenges.
InvestingPro Data reveals that XTI Aerospace has a market capitalization of only $9.9 million, reflecting the market's valuation of the company. The company's P/E ratio stands at a negative -2.68, and the adjusted P/E ratio for the last twelve months as of Q3 2023 is even lower at -0.9, indicating that the company is not currently profitable. Furthermore, the price of XTIA shares has fallen to just 2.22% of its 52-week high, with the previous close at $0.88.
InvestingPro Tips suggest that XTIA operates with a significant debt burden and is quickly burning through cash. Moreover, the stock has taken a big hit over the last week, month, and year, with price total returns plummeting. The RSI indicator also suggests the stock is in oversold territory, which might interest traders looking for potential rebounds. However, given the weak gross profit margins and the fact that short-term obligations exceed liquid assets, investors should be cautious.
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