XTI Aerospace subsidiary defaults on $4.51 million in seller notes, triggering cross-default on JPMorgan credit line

XTI Aerospace, Inc. disclosed in the Current Report on Form 8-K filed with the SEC on October 16, 2026 that its subsidiary, XTI Drones Holdings, LLC, failed to make principal payments due on or before September 30, 2026 on two promissory notes issued to fund its acquisitions of Drone Nerds, LLC and Anzu Robotics, LLC. The missed payments were $1,380,000 under the note held by The Origin Group DN, Inc. and $120,000 under the note held by The Origin Group AZ, Inc., the filing states.

Under the terms of the notes, a missed payment becomes an event of default if it continues for ten days. The filing says that period expired on October 10, 2026, so an event of default occurred on October 11, 2026. As of that date the aggregate outstanding principal on the two notes was approximately $4.51 million, including unpaid interest added to principal, according to the filing. The default rate on the notes rose to 9.25% per annum, up from the original 7.25%, the filing says.

The filing states that the sellers may, at their option, declare the full unpaid balance of each note immediately due, though as of the filing date neither seller had demanded payment or notified XTI Drones Holdings of any such declaration. XTI Drones Holdings has waived notice of default and notice of acceleration under both notes, the filing says.

The 8-K also discloses that the default on the Drone Nerds note triggered a cross-default under a Credit Agreement dated February 11, 2026 with JPMorgan Chase Bank, N.A., which provides a secured revolving credit facility of up to $20.0 million. While the resulting defaults continue, the filing states, the lender is not obligated to make further loans or issue letters of credit, and the loan parties may not make distributions to XTI Aerospace or payments on other indebtedness without the lender's consent. The filing says XTI Drones Holdings may need that consent to make the missed September 30 payments and to pay the remaining balance of the notes when they mature on November 10, 2026.

The filing states that the lender may also terminate its commitment, declare all amounts under the Credit Agreement immediately due, require cash collateral for outstanding letters of credit and charge an additional 2.00% in default interest. The filing does not say whether the lender has taken any of these steps.