XTI Aerospace, Inc. Q2 FY2023 earnings call

• Industrial RTLS business recap: Leverages RF technologies for precise positioning, integrates with third-party systems, and helps customers make data-driven decisions. Flat revenues for six months but expanded gross margins due to recurring revenues from IntraNav. • Merger with XTI Aircraft: Entered into a definitive merger agreement. XTI's TriFan 600 has a 700-mile range, 350 mph speed, and targets regional intercity travel. Over 700 conditional preorders could yield over $7 billion in gross revenue. Post-merger, the company will be NASDAQ-listed as XTI Aerospace with new leadership. • XTI's vision: To transform business aviation with the TriFan 600, a vertical lift crossover airplane (VLCA) designed for broader use cases than eVTOL air taxis, utilizing existing infrastructure and having no new flight regulations required.

Inpixon's industrial RTLS business had flat revenues for the six-month period ended June 30, 2023. Gross margins expanded as recurring revenues from the IntraNav product line increased. The RTLS business leverages connected hardware and software to track locations and provide actionable intelligence for customers, with customers including leading manufacturers in various segments.

• Expect to close the merger during the fourth quarter of 2023. • Shareholder meeting scheduled for Friday, September 8, at 1:00 PM Eastern for voting on merger-related proposals. • Post-merger, new leadership structure with Scott Pomeroy as CEO and Chairman, Michael Hinderberger as CEO of XTI Aircraft subsidiary, and Soumya Das as CEO of Inpixon’s RTLS business subsidiary.

• Forward-looking statements involve risks and uncertainties where stated expectations could differ materially from actual results. • Regulatory challenges for XTI's aircraft development, including FAA certification. • Infrastructure issues for eVTOLs such as undefined regulatory environment, nascent vertiports, and charging stations. • Technical limitations of battery/hydrogen technologies for eVTOLs, limiting range, air speed, altitude, and payload.

Q: Why is Inpixon pursuing this merger?

A: Inpixon believes its current value isn't adequately reflected in the market, and the merger with XTI offers the potential for significant upside with XTI's unique aircraft, over 700 conditional preorders, and entry into the NASDAQ market.

Q: What will be the ratio of stock ownership following the merger?

A: XTI shareholders will own about 60% of the outstanding shares of the post-combination company and Inpixon shareholders will retain approximately 40%, subject to adjustment based on the merger agreement terms.

Q: Will my Inpixon shares be automatically converted into shares of the new company?

A: No, Inpixon shares will remain the same; the name and ticker symbol will change, but there will be no conversion or exchange of shares.

Q: Why was the shareholder meeting moved?

A: The shareholder meeting was moved to allow shareholders more time to respond and vote on important proposals within the proxy materials.

Q: Why is XTI doing this deal?

A: The deal enhances XTI's ability to execute on its business plan, maintain production road map, formalize partnerships, accelerate aircraft development, expand the team, and become a NASDAQ-listed company.

Q: How would you characterize XTI's customers and their use cases?

A: Customers are spread globally across business aircraft and helicopter fleet operators, individuals, businesses, and regional airlines. Use cases include business travel, air medical, connecting communities with infrastructure challenges, and military applications.

Q: Could you please explain your sustainability path and why you're not using electric propulsion like all the eVTOLs aircraft being developed?

A: XTI is targeting a longer-range regional market not feasible with current battery technology. They're starting with turboshaft engines running on sustainable aviation fuel to reduce CO2 emissions, and will transition to hybrid/electric as technologies mature.