ENGLEWOOD, CO - XTI Aerospace, Inc. (NASDAQ:XTIA), a computer programming services company, has announced an extension of the maturity date for its bridge notes and the issuance of new equity shares, based on an 8-K filing with the Securities and Exchange Commission.
On Monday, the company entered into a material definitive agreement with Damon Motors Inc., a British Columbia corporation. This agreement, known as the Second Letter Agreement, amends the conditions of the bridge notes originally acquired during a private placement on October 26, 2023. The amendments include an extension of the bridge notes' maturity to October 31, 2024, with an option for Damon Motors to extend this period by an additional 30 days. Additionally, the definition of Permitted Indebtedness was expanded to encompass guarantees by Damon Motors for obligations of Grafiti Holding Inc. to certain note holders.
In relation to the issuance of equity securities, XTI Aerospace has exchanged 2,779,310 shares of its common stock for 550 shares of its Series 9 Preferred Stock, which were returned and canceled. The exchange took place on August 23, 2024, and Monday, with the Preferred Exchange Shares being issued at an effective price per share ranging between $0.1898 and $0.2256. This transaction was conducted under Section 3(a)(9) of the Securities Act, which allows for the exchange of securities without additional consideration or commissions.
Following these transactions, XTI Aerospace's outstanding common stock totals 39,447,029 shares as of today. The company's actions, as disclosed in the SEC filing, reflect ongoing financial adjustments and capital structure management.
In other recent news, XTI Aerospace has been actively involved in several significant developments. The company has entered into a second amendment to its Business Combination Agreement with Damon Motors Inc., extending the termination date of the agreement to October 30, 2024, and introducing new conditions, including a requirement for Damon Motors to secure at least $13 million in financing commitments.
XTI Aerospace has also announced a series of key appointments. Tobin Arthur, with a wealth of experience from his previous roles at Starbucks (NASDAQ:SBUX) Coffee, CureUs, and AngelMD, has been appointed as its Chief Strategy Officer. The company has also established a Corporate Advisory Board, led by Michael Tapp from Palingen Capital.
In addition, XTI Aerospace is currently engaged in a legal dispute with Chardan Capital Markets LLC over compensation claims, which has resulted in an arbitration claim. The company has also been involved in equity transactions, issuing shares and resulting in a total of 34,242,861 shares of common stock outstanding.
In terms of product development, XTI Aerospace has filed a non-provisional patent application for its TriFan 600 vertical takeoff and landing aircraft. It has also secured a conditional purchase agreement with Mesa Air Group (NASDAQ:MESA), Inc. for up to 100 TriFan 600 aircraft, potentially generating approximately $1 billion in revenue.
Lastly, XTI Aerospace has welcomed finance expert Tensie Axton to its Board of Directors. These are the recent developments for XTI Aerospace.
InvestingPro Insights
XTI Aerospace's recent financial maneuvers, as detailed in the article, align with several key insights from InvestingPro. The company's decision to extend the maturity of its bridge notes and issue new equity shares reflects its current financial position and market challenges.
InvestingPro data shows that XTI Aerospace has a market capitalization of just $6.37 million, indicating its small-cap status. This modest valuation is consistent with the company's recent financial restructuring efforts. Additionally, the company's revenue for the last twelve months as of Q2 2024 stands at $1.25 million, with a gross profit of $0.8 million, highlighting the scale of its operations.
Two particularly relevant InvestingPro Tips for XTI Aerospace are that the company is "quickly burning through cash" and its "short term obligations exceed liquid assets." These tips provide context for the company's decision to extend its bridge notes and issue new equity, as it likely needs to manage its cash flow and debt obligations carefully.
It's worth noting that XTI Aerospace is "trading near its 52-week low" and has experienced a significant price decline over the past year. This market performance may have influenced the company's recent financial decisions and could be of interest to investors considering the stock.
For readers seeking a more comprehensive analysis, InvestingPro offers 11 additional tips for XTI Aerospace, providing a deeper understanding of the company's financial health and market position.
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