XTI Aerospace Announces Closing of $20 Million Common Stock Offering

Rhea-AI Summary

XTI Aerospace (NASDAQ: XTIA) has successfully closed its previously announced best-efforts offering, raising $20 million through the sale of 1,454,546 shares of common stock. The shares were priced at-the-market at $13.75 per share on a post 1-for-250 reverse stock split basis.

ThinkEquity served as the sole placement agent for the offering, which was conducted under the company's effective shelf registration statement on Form S-3. The net proceeds will be primarily used for working capital and general corporate purposes. The offering was made through a prospectus supplement and prospectus filed with the SEC.

Positive

• Successfully raised $20 million in gross proceeds through stock offering
• Completed at-market pricing indicating current market acceptance

Negative

• Potential dilution of existing shareholders through issuance of 1,454,546 new shares
• Recent 1-for-250 reverse stock split suggests previous share price challenges

Insights

Financial Analyst

The $20 million stock offering marks a critical capital raise for XTI Aerospace, though it comes with notable dilution at $13.75 per share. The 1,454,546 new shares represent substantial dilution for existing shareholders, particularly following the recent 1-for-250 reverse stock split - a move typically implemented to maintain listing requirements or improve stock marketability.

The at-the-market pricing suggests moderate market reception, neither commanding a premium nor requiring a steep discount. With a market cap of about $14.9 million pre-offering, this capital injection more than doubles the company's equity base. While the strengthened balance sheet provides important working capital, the significant dilution and recent reverse split could signal underlying financial stress.

For retail investors, it's important to understand that while fresh capital is positive for operations, the dilutive effect and the recent reverse split warrant careful consideration. The use of a shelf registration from June 2024 indicates this raise was part of a planned financing strategy rather than an opportunistic move.

Market Research Analyst

The timing and structure of this offering reveal important market dynamics in the aerospace sector. The best-efforts basis, rather than a firm commitment underwriting, indicates cautious institutional appetite for aerospace startups in the current market environment. ThinkEquity's role as sole placement agent, rather than a syndicate of larger banks, further suggests institutional interest.

The aerospace industry's capital-intensive nature makes funding important for pre-revenue companies like XTI. This raise provides operational runway but also highlights the challenging funding environment for emerging aerospace companies. The choice of an at-market offering rather than a private placement indicates a strategic decision to leverage public markets despite potential dilution.

ENGLEWOOD, Colo., Jan. 10, 2025 /PRNewswire/ -- XTI Aerospace, Inc. (Nasdaq: XTIA), ("XTI" or the "Company"), a pioneer in advanced aircraft design, today announced the closing of its previously announced best-efforts offering of 1,454,546 shares of common stock, priced at-the-market under Nasdaq rules at an offering price of $13.75 per share, on a post 1-for-250 reverse stock split basis. Gross proceeds from the offering were approximately $20,000,000, before deducting the placement agent's fees and other offering expenses. All the shares in the offering were offered by the Company.

The Company intends to use the net proceeds from the offering primarily for working capital and general corporate purposes.

ThinkEquity acted as sole placement agent for the offering.

The securities were offered and sold pursuant to the Company's currently effective shelf registration statement on Form S-3 (File No. 333-279901), including a base prospectus, filed with the U.S. Securities and Exchange Commission (the "SEC") on May 31, 2024 and declared effective on June 18, 2024. The offering was made by means of a prospectus supplement and prospectus which have been filed with the SEC and available on the SEC's website at www.sec.gov. You should read the applicable prospectus supplement and prospectus for more complete information about the Company and the offering. You may obtain these documents free of charge by visiting the SEC website at www.sec.gov. Alternatively, you may obtain copies by contacting ThinkEquity, 17 State Street, 41st Floor, New York, New York 10004.

This press release shall not constitute an offer to sell or a solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

About XTI Aerospace, Inc.

XTI Aerospace (XTIAerospace.com) (NASDAQ: XTIA) is the parent company of XTI Aircraft Company, an aviation business based near Denver, Colorado, currently developing the TriFan 600, a fixed-wing business aircraft designed to have the vertical takeoff and landing (VTOL) capability of a helicopter, speeds of up to 345 mph and a range of approximately 700 miles, creating an entirely new category – the vertical lift crossover airplane (VLCA). Additionally, the Inpixon (inpixon.com) business unit of XTI Aerospace is a leader in real-time location systems (RTLS) technology with customers around the world who use the company's location intelligence solutions in factories and other industrial facilities to help optimize operations, increase productivity, and enhance safety. For more information about XTI Aerospace, please visit XTIAerospace.com and HangerXStudios.com (an aviation innovation podcast), and follow the company on LinkedIn, Instagram, X, and YouTube.

Forward Looking Statements

This press release contains certain "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act, and Section 21E of the Exchange Act. All statements other than statements of historical fact contained in this press release, including without limitation, statements about the products under development by XTI, the advantages of XTI's technology, and XTI's customers, plans and strategies are forward-looking statements.
Some of these forward-looking statements can be identified by the use of forward-looking words, including "believe," "continue," "could," "would," "will," "estimate," "expect," "intend," "plan," "target," "projects," or the negatives of these terms or variations of them or similar expressions. All forward-looking statements are subject to risks, uncertainties, and other factors which could cause actual results to differ materially from those expressed or implied by such forward-looking statements. All forward-looking statements are based upon estimates, forecasts, and assumptions that, while considered reasonable by XTI and its management, are inherently uncertain, and many factors may cause the actual results to differ materially from current expectations. XTI undertakes no obligation to revise any forward-looking statements in order to reflect events or circumstances that might subsequently arise. Readers are urged to carefully review and consider the risk factors discussed from time to time in XTI's filings with the SEC, including those factors discussed under the caption "Risk Factors" in its most recent annual report on Form 10-K, filed with the SEC on April 16, 2024, and in subsequent reports filed with or furnished to the SEC.

Contacts:

General inquiries:
Email: contact@xtiaerospace.com
Web: https://xtiaerospace.com/contact

Investor Relations:
Crescendo Communications
Tel: +1 212-671-1020
Email: XTIA@crescendo-ir.com

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SOURCE XTI Aerospace, Inc.

FAQ

How much did XTI Aerospace (XTIA) raise in its January 2025 stock offering?

XTI Aerospace raised $20 million in gross proceeds through the offering of 1,454,546 shares of common stock priced at $13.75 per share.

What is the offering price per share for XTIA's January 2025 stock offering?

The offering was priced at $13.75 per share, at-the-market under Nasdaq rules, on a post 1-for-250 reverse stock split basis.

How will XTIA use the proceeds from its January 2025 stock offering?

XTI Aerospace intends to use the net proceeds primarily for working capital and general corporate purposes.

What was the reverse stock split ratio implemented by XTIA before the offering?

XTI Aerospace implemented a 1-for-250 reverse stock split prior to the offering.

Who was the placement agent for XTIA's January 2025 stock offering?

ThinkEquity acted as the sole placement agent for the offering.