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XTI Aerospace, Inc. (NASDAQ:XTIA), currently trading at $2.04 with a market capitalization of $40.6 million, announced Tuesday it has entered into a settlement agreement with Chardan Capital Markets LLC and its subsidiary, XTI Aircraft Company, resolving all claims related to a previous arbitration proceeding. The company, which has seen its stock surge nearly 18% in the past week despite an 84% decline over six months, made this announcement in a recent SEC filing. According to InvestingPro data, XTI maintains a healthy balance sheet with more cash than debt.
According to the filing, the dispute originated from an engagement letter dated June 7, 2022, between Chardan and XTI Aircraft Company. Chardan initiated arbitration before the Financial Industry Regulatory Authority in August 2024. XTI Aerospace filed a petition in the U.S. District Court for the Southern District of New York to stay the arbitration as it related to the parent company. In January 2025, the court ruled in favor of XTI Aerospace, enjoining Chardan from pursuing arbitration against the parent company and declaring that XTI Aerospace had no obligation to arbitrate with Chardan. While the company faces legal challenges, InvestingPro analysis reveals 16 additional key insights about XTI’s financial position and market outlook.
Chardan later amended its claim in April 2025 to exclude XTI Aerospace as a party, focusing solely on XTI Aircraft Company. In June 2025, XTI Aircraft Company filed an answer and counterclaims for breach of contract.
On July 8, 2025, the parties executed a settlement agreement. Under the terms, all sides mutually released each other from any claims, including those related to the arbitration. Both Chardan and XTI Aircraft Company agreed to dismiss with prejudice all claims in the arbitration. The filing specifies that no payments were made by any party as part of the settlement, and no amounts or debts are owed between the parties. This settlement comes as XTI reports revenue of $3.47 million in the last twelve months, with analysts expecting sales growth in the current year despite challenges in achieving profitability.
The settlement also terminates the original engagement letter, which is now of no further effect.
XTI Aerospace’s common stock is listed on the Nasdaq Capital Market under the symbol XTIA. The company made the announcement through a press release statement included in its SEC filing.
In other recent news, XTI Aerospace announced the completion of several significant milestones related to the development and certification of its TriFan 600 aircraft. The company has successfully completed a propulsion technical familiarization meeting with the Federal Aviation Administration (FAA), which covered crucial aspects such as engine fire containment and cabin occupant safety. Additionally, XTI Aerospace has finalized a structures technical familiarization meeting with the FAA, marking further progress in the certification process. On the financial front, XTI Aerospace closed a partial exercise of the over-allotment option in its public offering, raising approximately $18 million before expenses. The company has also partnered with MagLev Aero to explore electric propulsion technologies for future aircraft models. This collaboration involves a preliminary order for up to 100 MagLev HyperDrive propulsion systems. Furthermore, XTI Aerospace has completed over 1,500 computational fluid dynamics calculations to optimize the aerodynamics of the TriFan 600, using the Frontier supercomputer. These developments underscore XTI Aerospace’s ongoing efforts to bring its innovative aircraft to market.
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