As filed with the Securities and Exchange Commission on November 7, 2023

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

AMENDMENT NO. 2
to
FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

INPIXON

(Exact name of Registrant as specified in its charter)

2479 E. Bayshore Road, Suite 195
Palo Alto, CA 94303
(408) 702-2167

(Address including zip code, and telephone number, including area code, of Registrant’s principal executive offices)

Nadir Ali
Chief Executive Officer
Inpixon
2479 E. Bayshore Road, Suite 195
Palo Alto, CA 94303
(408) 702-2167

(Name, address, including zip code, and telephone number, including area code, of agent for service)

Copies to:

Approximate date of commencement of proposed sale of the securities to the public: As soon as practicable after the effectiveness of this registration statement and the satisfaction or waiver of all other conditions under the Merger Agreement described herein.

If the securities being registered on this Form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, please check the following box. ☐

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐

If applicable, place an X in the box to designate the appropriate rule provision relied upon in conducting this transaction:

Exchange Act Rule 13(e)-4(i) (Cross-Border Issuer Tender Offer) ☐

Exchange Act Rule 14d-1(d) (Cross-Border Third-Party Tender Offer) ☐

Subject to completion, dated November 7, 2023

PRELIMINARY PROXY STATEMENT FOR

To the stockholders of Inpixon:

Inpixon (“Inpixon”) and XTI Aircraft Company (“XTI”) have entered into an Agreement and Plan of Merger, dated July 24, 2023 (as it may be amended from time to time, the “Merger Agreement”), pursuant to which a wholly-owned subsidiary of Inpixon will merge with and into XTI, with XTI surviving as a wholly-owned subsidiary of Inpixon (the “merger” or the “Business Combination”). Inpixon following the merger is also referred to as the “combined company.”

At the effective time of the merger (the “Effective Time”), each issued and outstanding share of common stock of XTI, $0.001 par value per share (“XTI common stock”), will be converted into the right to receive a number of shares of Inpixon common stock equal to the exchange ratio (the “Exchange Ratio”) determined pursuant to a formula in the Merger Agreement (the “Exchange Ratio Formula”) as described in more detail in the section titled “The Merger Agreement — Merger Consideration and Exchange Ratio” beginning on page 90 of this proxy statement/prospectus. Additionally, at the Effective Time, each outstanding option and warrant to purchase shares of XTI common stock will be assumed by the combined company and will be converted into an option or warrant, as applicable, to purchase shares of Inpixon common stock, with necessary adjustments to reflect the Exchange Ratio (collectively, the “Assumed Options and Warrants”). Prior to the Effective Time, and subject to the consent of the noteholders, as applicable, all outstanding XTI convertible notes will be converted into XTI common stock and will participate in the merger on the same basis as the other shares of XTI common stock, except for (1) a promissory note dated April 1, 2023, in the initial principal amount of $1,817,980, which will be amended to extend the maturity date thereof until no sooner than December 31, 2026 and be assumed by the combined company at the Closing to become convertible into the shares of common stock of the combined company (collectively with the Assumed Options and Warrants, the “Assumed Options, Warrants and Note”), and (2) a promissory note dated December 31, 2021, in the initial principal amount of $1,007,323, which will provide for, at Closing, payment in cash of $507,323 of the principal plus interest accrued to the date of payment, and the conversion of the remaining $500,000 of outstanding principal into shares of common stock of the combined company.

Each share of Inpixon capital stock, option and warrant to purchase Inpixon common stock that is outstanding at the Effective Time will remain outstanding in accordance with its terms, and such shares of capital stock, options and warrants will be unaffected by the merger

Under the Merger Agreement, the Exchange Ratio will be determined in part based on the fully diluted capitalization of each of Inpixon and XTI immediately prior to the Effective Time, provided that, for this purpose the calculation of Inpixon’s fully diluted capitalization will not take into account any shares of Inpixon common stock issuable after the Effective Time for cash consideration upon conversion, exercise or exchange of securities that are permitted to be issued by Inpixon under the Merger Agreement prior to the Effective Time. Under the Merger Agreement, prior to the Effective Time, Inpixon is permitted to issue common stock or securities that are convertible into or exercisable or exchangeable for common stock, for financing or debt cancellation purposes.

The Exchange Ratio will be adjusted to the extent the amount of Inpixon’s net cash (inclusive of amounts advanced by Inpixon to XTI) immediately prior to the Effective Time (“Inpixon Net Cash”) is greater than or less than $21,500,000 and the extent to which any debt remains outstanding under the promissory notes issued by Inpixon to Streeterville Capital, LLC on July 22, 2022 and December 30, 2022 (the “Streeterville Notes”). Inpixon will use commercially reasonable efforts to deliver Inpixon Net Cash of at least $10,000,000.

After application of the Exchange Ratio, Inpixon stockholders as of immediately prior to the Effective Time will retain approximately 40% of the issued and outstanding common stock of the combined company and XTI stockholders as of immediately prior to the Effective Time will retain approximately 60% of the issued and outstanding common stock of the combined company, subject to adjustments as provided in the Merger Agreement and excluding the impact of additional shares of Inpixon common stock that may be issued upon the exercise or vesting, as applicable, of the combined company’s outstanding warrants, convertible notes, unvested restricted stock and options including the Assumed Options, Warrants and Note.

Assuming the fully diluted capitalization of Inpixon and XTI immediately prior to the Effective Time is unchanged from the same as of October 24, 2023, if Inpixon Net Cash is $10,000,000, and the amount of principal and interest outstanding under the Streeterville Notes is $10,380,000, then the Exchange Ratio would be 0.08123614, assuming that Inpixon effects a reverse stock split of its common stock immediately prior to the Effective Time (an “Inpixon Reverse Stock Split”) at a ratio of 1-for-50. Inpixon may effect a reverse stock split at a different ratio, subject to compliance with applicable law, and references in this proxy statement/prospectus to a 1-for-50 reverse stock split are for illustrative purposes only.

At or prior to the Effective Time, Inpixon will effect transactions for the divestiture of its Shoom, SAVES and Game Your Game lines of business and investment securities, as applicable, by any lawful means, including a sale to one or more third parties, spin off, plan of arrangement, merger, reorganization, or any combination of these.

Inpixon common stock is currently listed on the Nasdaq Capital Market under the symbol “INPX.” Inpixon has filed an initial listing application for the combined company’s common stock on the Nasdaq Capital Market. After completion of the merger, Inpixon will change its corporate name to “XTI Aerospace, Inc.” and trade under the symbol “XTIA.” On November [    ], 2023, the last trading day before the date of this proxy statement/prospectus, the closing sale price of Inpixon common stock was $[            ] per share.

Inpixon is holding a special meeting in lieu of a 2023 annual meeting of its stockholders (the “Inpixon special meeting”) in order to obtain the stockholder approvals necessary to complete the merger and the related transactions, and stockholder approvals customary for an annual meeting, as described in this proxy statement/prospectus. The Inpixon special meeting will be held virtually at 10:00 A.M., Pacific Time, on December [    ], 2023, unless postponed or adjourned to a later date, for the purpose of considering and voting upon the matters set forth in the Notice of Special Meeting of Stockholders and accompanying proxy statement/prospectus. The Special Meeting will be a completely virtual meeting of stockholders conducted via live audio webcast. You will be able to attend the Inpixon special meeting by visiting www.virtualshareholdermeeting.com/INPX2023SM.

As described in the proxy statement/prospectus, two majority stockholders who own the requisite number of outstanding shares of XTI common stock have delivered a written consent sufficient to approve and adopt the Merger Agreement and the merger and the related transactions contemplated by the Merger Agreement. Therefore, no additional approval or vote from any holders of any class or series of stock of XTI will be necessary to approve the merger and the related transactions contemplated by the Merger Agreement.

After careful consideration, each of the boards of directors of Inpixon and XTI has (i) unanimously determined that the merger and all related transactions contemplated by the Merger Agreement are fair to, advisable and in the best interests of the applicable company’s stockholders, (ii) approved and declared advisable the Merger Agreement and the transactions contemplated by the Merger Agreement, and (iii) determined to recommend, upon the terms and subject to the conditions set forth in the Merger Agreement, that the respective stockholders approve the proposals necessary to accomplish the transactions contemplated by the Merger Agreement.

More information about Inpixon, XTI and the proposed transactions is contained in this proxy statement/prospectus. Inpixon and XTI urge you to read this proxy statement/prospectus carefully and in its entirety. IN PARTICULAR, YOU SHOULD CAREFULLY CONSIDER THE MATTERS DISCUSSED UNDER “RISK FACTORS” BEGINNING ON PAGE 23.

Inpixon and XTI are excited about the opportunities the merger brings to both Inpixon’s and XTI’s stockholders.

Nadir Ali
CEO, Inpixon

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this proxy statement/prospectus. Any representation to the contrary is a criminal offense.

The accompanying proxy statement/prospectus is dated [              ], 2023, and is first being mailed to Inpixon’s stockholders on or about [              ], 2023.

INPIXON
2479 E. Bayshore Road, Suite 195
Palo Alto, CA 94303
(408) 702-2167

NOTICE OF SPECIAL MEETING IN LIEU OF 2023 ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON DECEMBER [    ], 2023

Dear Stockholders of Inpixon:

On behalf of the board of directors (the “Inpixon Board”) of Inpixon, a Nevada corporation (“Inpixon”), we are pleased to deliver this proxy statement/prospectus for a special meeting of stockholders of Inpixon (the “Inpixon special meeting”) and for the proposed business combination between Inpixon and XTI Aircraft Company, a Delaware corporation (“XTI”), pursuant to which Superfly Merger Sub Inc., a Delaware corporation and wholly-owned subsidiary of Inpixon (“Merger Sub”), will merge with and into XTI, with XTI surviving as a wholly-owned subsidiary of Inpixon (the “merger”). The Inpixon special meeting will be a completely virtual meeting of stockholders conducted via live virtual meeting to enable our stockholders to participate from any location around the world. You will be able to attend the special meeting by visiting www.virtualshareholdermeeting.com/INPX2023SM. The Inpixon special meeting will be held on December [    ], 2023 at 10:00 A.M., Pacific Time, for the following purposes:

1.      to consider and vote upon a proposal to approve the issuance of shares of Inpixon common stock, $0.001 par value per share, to equity holders of XTI Aircraft Company pursuant to the terms of the Agreement and Plan of Merger, dated as of July 24, 2023, by and among Inpixon, Superfly Merger Sub Inc. and XTI Aircraft Company, a copy of which is attached as Annex A to this proxy statement/prospectus (the “Merger Agreement”), and the change of control of Inpixon resulting from the merger, pursuant to Nasdaq Listing Rules 5635(a) and 5635(b), respectively (the “Nasdaq Stock Issuance Proposal” or “Proposal No. 1”);

2.      to consider and vote on an advisory, non-binding basis to approve merger-related executive compensation for Inpixon’s executive officers (the “Transaction Bonus Plan Proposal” or “Proposal No. 2”);

3.      to elect five directors to serve until our next annual meeting of stockholders or until the election and qualification of their successors (the “Director Election Proposal” or “Proposal No. 3”);

4.      to consider and vote on an advisory, non-binding basis to approve the compensation paid to our named executive officers (the “Say-on-Pay Proposal” or “Proposal No. 4”);

5.      to ratify the appointment of Marcum LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2023 (the “Auditor Ratification Proposal” or “Proposal No. 5”);

6.      to consider and vote on an amendment to Inpixon’s Restated Articles of Incorporation, as amended (the “Articles of Incorporation”) to increase the number of authorized shares of Inpixon common stock to up to 1,000,000,000 shares, with such number to be determined at the Board’s discretion (the “Authorized Share Increase Proposal” or “Proposal No. 6”);

7.      To consider and vote on an increase in the reverse split ratio previously approved by the stockholders of Inpixon at the special meeting of Inpixon stockholders held on September 29, 2023, from a ratio of 1-for-2 to 1-for-50 to a ratio of 1-for-2 to 1-for-200 (the “Reverse Split Ratio Proposal” or “Proposal No. 7”);

8.      To consider and vote on a proposal to approve potential issuances of shares of Inpixon common stock pursuant to one or more potential non-public transactions in accordance with Nasdaq Listing Rule 5635(d) (the “Potential Financing Issuances Proposal” or “Proposal No. 8”);

9.      to consider and vote upon an adjournment of the Inpixon special meeting, if necessary, to solicit additional proxies if there are not sufficient votes in favor of Proposal Nos. 1, 3, 6, 7 and 8 above (the “Adjournment Proposal” or “Proposal No. 9”); and

10.    to transact such other business as may properly come before the Inpixon special meeting or any adjournment or postponement thereof.

The Inpixon Board has fixed October 24, 2023 as the record date for the determination of stockholders entitled to notice of, and to vote at, the Inpixon special meeting and any adjournment or postponement thereof (the “Record Date”). Only holders of record of shares of Inpixon common stock at the close of business on the Record Date are entitled to notice of, and to vote at, the Inpixon special meeting. At the close of business on the Record Date, Inpixon had 127,688,550 shares of common stock outstanding and entitled to vote.

Your vote is important. The affirmative vote of the holders of Inpixon common stock representing a majority of the votes cast by the holders of all shares of common stock present, virtually or by proxy, at the Inpixon special meeting and entitled to vote on the matter is required for approval of each of the proposals to be voted upon at the Inpixon special meeting.

The merger cannot be consummated without the approval of the Nasdaq Stock Issuance Proposal.

Even if you plan to virtually attend the Inpixon special meeting, Inpixon requests that you sign and return the enclosed proxy to ensure that your shares will be represented at the Inpixon special meeting if you are unable to attend.

THE INPIXON BOARD HAS DETERMINED AND BELIEVES THAT EACH OF THE PROPOSALS OUTLINED ABOVE IS ADVISABLE TO, AND IN THE BEST INTERESTS OF, INPIXON AND ITS STOCKHOLDERS AND HAS APPROVED EACH SUCH PROPOSAL. THE INPIXON BOARD RECOMMENDS THAT INPIXON STOCKHOLDERS VOTE “FOR” EACH SUCH PROPOSAL.

ABOUT THIS PROXY STATEMENT/PROSPECTUS

This proxy statement/prospectus, which forms part of a registration statement on Form S-4 filed with the SEC by Inpixon (File No. 333-273964), constitutes a prospectus of Inpixon under Section 5 of the Securities Act of 1933, as amended, (the “Securities Act”), with respect to the shares of Inpixon common stock to be issued pursuant to the Merger Agreement. This document also constitutes a notice of meeting and a proxy statement under Section 14(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), with respect to the Inpixon special meeting, at which Inpixon stockholders will be asked to consider and vote on, among other matters, a proposal to approve the issuance of shares of Inpixon common stock pursuant to the Merger Agreement.

No one has been authorized to provide you with information that is different from that contained in, or incorporated by reference into, this proxy statement/prospectus. This proxy statement/prospectus is dated November [        ], 2023. The information contained in this proxy statement/prospectus is accurate only as of that date or, in the case of information in a document incorporated by reference, as of the date of such document, unless the information specifically indicates that another date applies.

This proxy statement/prospectus does not constitute an offer to sell, or a solicitation of an offer to buy, any securities, or the solicitation of a proxy, in any jurisdiction in which or from any person to whom it is unlawful to make any such offer or solicitation in such jurisdiction.

The information concerning Inpixon contained in this proxy statement/prospectus or incorporated by reference has been provided by Inpixon, and the information concerning XTI contained in this proxy statement/prospectus has been provided by XTI.

TABLE OF CONTENTS

References to “Inpixon” and “XTI” in this proxy statement/prospectus refer to Inpixon and XTI Aircraft Company, respectively. References to the “combined company” refer to Inpixon and its wholly-owned subsidiary, XTI, or Inpixon, after the merger, as the context indicates. Except as otherwise noted, references to “we,” “us” or “our” refer to Inpixon. References to “Merger Sub” refer to Superfly Merger Sub Inc., a newly formed, wholly-owned subsidiary of Inpixon.

References to the “Merger Agreement” refer to that certain Agreement and Plan of Merger dated as of July 24, 2023, among Inpixon, Merger Sub and XTI, as amended from time to time. References to the “merger” refer to the merger of Merger Sub with and into XTI, with XTI surviving as the surviving entity and as a wholly-owned subsidiary of Inpixon as contemplated under the Merger Agreement.

QUESTIONS AND ANSWERS ABOUT THE MERGER AND
THE SPECIAL MEETING OF INPIXON STOCKHOLDERS

Except where specifically noted, the following information and all other information contained in this proxy statement/prospectus does not give effect to any Inpixon Reverse Stock Split that may be implemented prior to the consummation of the merger.

The following section provides answers to frequently asked questions about the merger. This section, however, provides only summary information. For a more complete response to these questions and for additional information, please refer to the cross-referenced sections.

Q:     What is the merger?

A:     On July 24, 2023, Inpixon, a Nevada corporation (“Inpixon”), entered into an Agreement and Plan of Merger (as it may be amended from time to time, the “Merger Agreement”) by and among Inpixon, Superfly Merger Sub Inc., a Delaware corporation and a wholly-owned subsidiary of Inpixon (“Merger Sub”), and XTI Aircraft Company, a Delaware corporation (“XTI”). The Merger Agreement was unanimously approved by Inpixon’s and XTI’s board of directors and the majority stockholders of XTI approved the Merger Agreement by written consent. If the Merger Agreement is approved by Inpixon’s stockholders (and the other closing conditions are satisfied or waived in accordance with the Merger Agreement), and the transactions contemplated by the Merger Agreement are consummated, Merger Sub will merge with and into XTI, with XTI surviving the merger as a wholly-owned subsidiary of Inpixon (collectively, the “Proposed Transaction”). In addition, upon the consummation of the Proposed Transaction (the “Closing,” and the date of the Closing, the “Closing Date”), Inpixon will be renamed “XTI Aerospace, Inc.” (the “Name Change”). Inpixon upon the Closing is referred to herein as the “combined company.”

Q:     What will XTI securityholders receive in the merger?

A:     At the Effective Time, each share of XTI common stock will be converted into the right to receive a number of shares of Inpixon common stock equal to the Exchange Ratio determined pursuant to the Exchange Ratio Formula as described in more detail in the section titled “The Merger Agreement — Merger Consideration and Exchange Ratio” beginning on page 90 of this proxy statement/prospectus. Additionally, at the Effective Time, each outstanding option and warrant to purchase shares of XTI common stock will be assumed by the combined company and will be converted into an option or warrant, as applicable, to purchase shares of Inpixon common stock, with necessary adjustments to reflect the Exchange Ratio.

Prior to the Effective Time, subject to obtaining the consent of requisite noteholders, all outstanding XTI convertible notes will be converted into XTI common stock and will participate in the merger on the same basis as the other shares of XTI common stock, except for (1) a promissory note dated April 1, 2023, in the initial principal amount of $1,817,980, which will be amended to extend the maturity date thereof until no sooner than December 31, 2026 and be assumed by the combined company at the Closing to become convertible into the shares of common stock of the combined company, and (2) a promissory note dated December 31, 2021, in the initial principal amount of $1,007,323, which will provide for, at Closing, payment in cash of $507,323 of the principal plus interest accrued to the date of payment, and the conversion of the remaining $500,000 of outstanding principal into shares of common stock of the combined company.

Assuming the fully diluted capitalization of Inpixon and XTI immediately prior to the Effective Time is unchanged from the same as of October 24, 2023, the Exchange Ratio is estimated to be 0.081236145 based on Inpixon and XTI’s fully diluted capitalization as of October 24, 2023, the amounts of the other elements defined in the Exchange Ratio Formula as of October 24, 2023, as well as the assumption that Inpixon will deliver an amount of net cash equal to $10,000,000 (inclusive of amounts advanced by Inpixon to XTI prior to closing) (“Inpixon Net Cash”) and that the Inpixon Reverse Stock Split is implemented immediately prior to the consummation of the merger at a ratio of 1-for-50. Inpixon may effect a reverse stock split at a different ratio, subject to compliance with applicable law, and references in this proxy statement/prospectus to a 1-for-50 reverse stock split are for illustrative purposes only. The Exchange Ratio will be further adjusted if any of the assumptions described above have changed as of the effective time of the merger, including the fully diluted capitalization of the parties, Inpixon’s actual net cash as calculated and as of a time determined in accordance with the Merger Agreement, and the outstanding balance payable under the Streeterville Notes.

The shares of Inpixon common stock to be issued as merger consideration to XTI stockholders who did not execute the XTI Stockholder Consent (as defined below) are being offered pursuant to this proxy statement/prospectus. The shares of Inpixon common stock to be issued as merger consideration to the stockholders who executed the XTI Stockholder Consent were offered in a private placement pursuant to an exemption from registration. There is no difference between the merger consideration that will be received by the XTI stockholders who did not execute the XTI Stockholder Consent and the XTI stockholders who executed the XTI Stockholder Consent, except that the shares of Inpixon Common Stock the XTI stockholders who executed the XTI Stockholder Consent will receive as merger consideration will not be registered under the Securities Act and will be subject to restrictions on resale unless registered under the Securities Act. Under the Merger Agreement, Inpixon has agreed to file a registration statement under the Securities Act within ten business days after the closing date of the merger to register the resale of such shares of Inpixon common stock the XTI stockholders who executed the XTI Stockholder Consent will receive as merger consideration.

Q:     What will Inpixon securityholders receive in the merger?

A:     At the Effective Time, holders of Inpixon capital stock, options and warrants will continue to own and hold their respective existing Inpixon capital stock, options and warrants. Each of the holders of the Inpixon January 2019 Warrants (34 shares of common stock are issuable upon the exercise of such warrants at an exercise price of $11,238.75 per share) and August 2019 Warrants (73 shares of common stock are issuable upon the exercise of warrants at an exercise price of $936.5625 per share), each subject to adjustment in proportion to the Inpixon Reverse Stock Split, may, concurrently with, or within 30 days after, the consummation of the merger, require Inpixon to purchase these warrants from the holder by paying to the holder an amount of cash equal to the Black Scholes Value of the remaining unexercised portion of the warrants on the date of the consummation of the merger.

Q:     What will happen to Inpixon if, for any reason, the merger does not close?

A:     If, for any reason, the merger does not close, the Inpixon Board may elect to, among other things, attempt to complete another strategic transaction like the merger, attempt to sell or otherwise dispose of the various assets of Inpixon, or resume its research and development activities and continue to operate the business of Inpixon. If Inpixon were to continue its business, it would need to raise additional cash to fund ongoing operations and future development activities for its existing product candidates and any new product candidates that it acquires.

Q:     Why are the two companies proposing to merge?

A:     Inpixon believes that the value of its businesses is not properly reflected by its current share price or market cap. This transaction provides Inpixon and its shareholders with an opportunity to retain a meaningful ownership interest in a company that is operating in a multi-billion market with a valuation range determined by an independent valuation firm that is multiples of Inpixon’s market cap. Inpixon believes that with XTI’s experienced executive team and the potential of the TriFan 600 for the aviation industry, the consummation of this transaction has the potential to unlock additional value for Inpixon shareholders. For XTI, the transaction is anticipated to enhance its profile as a Nasdaq listed company. It will also provide additional avenues for access to capital which will enhance its ability to execute on its business plan and production roadmap and expand its world-class team. For a discussion of Inpixon’s and XTI’s reasons for the merger, please see the section entitled “The Merger-Inpixon Reasons for the Merger” and “The Merger-XTI Reasons for the Merger” in this proxy statement/prospectus.

Q:     Why am I receiving this proxy statement/prospectus?

A:     You are receiving this proxy statement/prospectus because you have been identified as an Inpixon stockholder as of the Record Date, and you are entitled, as applicable, to notice of, and to vote at, the Inpixon special meeting. This document serves as:

•        a proxy statement of Inpixon used to solicit proxies for the Inpixon special meeting; and

•        a prospectus of Inpixon used to offer shares of Inpixon common stock in exchange for shares of XTI common stock in the merger and issuable upon exercise of the Assumed Options, Warrants and Note.

Q:     What is required to consummate the merger?

A:     To consummate the merger, Inpixon stockholders must approve the issuance of shares of Inpixon common stock to equityholders of XTI pursuant to the terms of the Merger Agreement and the change of control of Inpixon resulting from the merger under The Nasdaq Stock Market LLC rules. The merger cannot be consummated without the approval of the Nasdaq Stock Issuance Proposal.

Majority stockholders who own the requisite number of outstanding shares of XTI common stock have delivered a written consent sufficient to approve and adopt the Merger Agreement and the merger and the related transactions contemplated by the Merger Agreement (the “XTI Stockholder Consent”). Therefore, no additional approval or vote from any holders of any class or series of stock of XTI will be necessary to approve the merger.

In addition to the requirement of obtaining the Inpixon stockholder approval described above and appropriate regulatory approvals, each of the other closing conditions set forth in the Merger Agreement must be satisfied or waived. For a more complete description of the closing conditions under the Merger Agreement, please see the section entitled “The Merger Agreement-Conditions to the Completion of the Merger” in this proxy statement/prospectus.

Q:     What stockholder votes are required to approve the proposals required in connection with the merger at the Inpixon special meeting?

A:     The affirmative vote of the holders of Inpixon common stock representing a majority of the votes cast by the holders of all shares of common stock present, virtually or by proxy, at the Inpixon special meeting and entitled to vote on the matter is required for approval of Proposal Nos. 1-5 and 7-9. The affirmative vote of the holders of shares of Inpixon common stock representing a majority of the voting power outstanding as of the Record Date is required for approval of Proposal No. 6, the Authorized Share Increase Proposal.

Votes will be counted by the inspector of election appointed for the Inpixon special meeting, who will separately count “FOR” and “AGAINST” votes, abstentions and broker non-votes. Abstentions and broker non-votes will have no effect on the outcome of Proposal Nos. 1-5 and 7-9. Abstentions and broker non-votes will be counted as votes against Proposal No. 6, the Authorized Share Increase Proposal.

For Proposal No. 3, the Director Election Proposal, the election of Inpixon directors, the nominees will be elected by a majority of the votes cast by the holders of Inpixon common stock present virtually or represented by proxy and entitled to vote in the election. You may choose to vote FOR, AGAINST, or ABSTAIN separately for each nominee. A properly executed proxy or voting instructions marked ABSTAIN with respect to the election of one or more directors will not be voted with respect to the director or directors indicated, although it will be counted for the purposes of determining whether there is a quorum. Stockholders may not cumulate votes in the election of directors, which means that each stockholder may vote no more than the number of votes such stockholder is entitled to cast for a single director candidate.

Q:     How will the Inpixon Reverse Stock Split impact the merger?

A:     The Inpixon Reverse Stock Split, at a ratio of 1-for-2 to 1-for-50, has been approved by Inpixon’s stockholders. We are seeking approval from Inpixon stockholders to increase the maximum reverse split ratio from 1-for-50 to 1-for-200 at the Inpixon special meeting. The Inpixon Reverse Stock Split, once implemented, will reduce the number of shares of Inpixon Common Stock outstanding in proportion to the reverse split ratio to be determined in the discretion of Inpixon’s Board of Directors. We expect that when implemented, the Inpixon Reverse Stock Split will proportionally increase the market price of Inpixon Common Stock; however, it cannot be assured that it will increase the market price of Inpixon Common Stock by a multiple of the proposed stock split ratio or result in any permanent or sustained increase in the market price of Inpixon Common Stock. In addition, we believe that the Inpixon Reverse Stock Split will ensure that Inpixon has sufficient authorized but unissued shares of common stock to issue to the equityholders of XTI pursuant to the terms of the Merger Agreement. Moreover, our liquidity could also be adversely affected by the reduced number of shares outstanding after the Inpixon Reverse Stock Split. The reduction in the number of outstanding shares may lead to reduced trading and a smaller number of market makers for the combined company’s common stock. If the Inpixon Reverse Stock Split is implemented, the Exchange Ratio and related pro forma ownership will be adjusted pursuant to the merger agreement in accordance with the reverse split ratio to account for the effect of the Reverse Stock Split prior to the Effective Time.

Q:     Who will be the directors of Inpixon following the merger?

A:     Following the consummation of the merger, the size of the Inpixon Board is expected to be comprised of five directors. Pursuant to the terms of the Merger Agreement, the Inpixon Board will be reconstituted such that three of the initial post-Closing directors will be nominated by XTI, and two of the initial post-Closing directors will be nominated by Inpixon. In addition, the directorships for the Inpixon Board will be divided into three separate classes designated as Class I, Class II and Class III. The term of any initial Class I director shall expire in 2024,

the term of any initial Class II director shall expire in 2025, and the term of any initial Class III director shall expire in 2026, or, in each case, upon such director’s earlier death, resignation or removal. The composition and initial division into classes of the Inpixon Board will be agreed by Inpixon and XTI prior to the Closing; provided, however, no more than one (1) director nominated by Inpixon prior to Closing will be in any one class. It is currently anticipated that, following the Closing, the Inpixon Board will be constituted as follows:

Q:     Who will be the executive officers of Inpixon immediately following the merger?

A:     Immediately following the consummation of the merger, the executive management team of Inpixon is expected to be composed of certain members of Inpixon’s and XTI’s executive management team prior to the merger, as follows:

Q:     What are the material U.S. federal income tax consequences of the merger?

A:     Inpixon and XTI each intends and expects for the merger to qualify as a “reorganization” within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended (the “Code”). Assuming the merger so qualifies, a U.S. Holder (as defined on page 95) of XTI common stock (excluding a U.S. Holder who exercises dissenters’ rights) will not recognize any gain or loss for U.S. federal income tax purposes on the exchange of shares of XTI common stock for shares of Inpixon common stock in the merger.

Please review the information in the section entitled “The Merger-Material U.S. Federal Income Tax Consequences of the Merger” for a more complete description of the material U.S. federal income tax consequences of the merger to U.S. Holders of XTI common stock. The discussion of the material U.S. federal income tax consequences contained in this proxy statement/prospectus is intended to provide only a general discussion. The tax consequences to you of the merger will depend on your particular facts and circumstances, and you may be subject to state, local or non-U.S. tax laws that are not discussed in this joint proxy statement/prospectus. Therefore, you should consult your own tax advisor as to the specific tax consequences to you of the merger.

Q:     As an Inpixon stockholder, how does the Inpixon Board recommend that I vote?

A:     After careful consideration, the Inpixon Board recommends that Inpixon stockholders vote “FOR” all of the proposals described in this proxy statement/prospectus.

Q:     What risks should I consider in deciding whether to vote in favor of the merger?

A:     You should carefully review the section entitled “Risk Factors” in this proxy statement/prospectus which sets forth certain risks and uncertainties related to the merger, risks and uncertainties to which the combined company’s business will be subject, and risks and uncertainties to which each of Inpixon and XTI, as independent companies, are subject.

Q:     Who can vote at the Inpixon special meeting?

A:     Only Inpixon stockholders of record at the close of business on the Record Date will be entitled to vote at the Inpixon special meeting. As of the Record Date, there were 127,688,550 shares of Inpixon common stock outstanding and entitled to vote.

Stockholder of Record: Shares Registered in Your Name

If, at the close of business on the Record Date, your shares of Inpixon common stock were registered directly in your name with Inpixon’s transfer agent, Computershare Trust Company, N.A., then you are an Inpixon stockholder of record. As an Inpixon stockholder of record, you may vote virtually at the Inpixon special meeting or vote by proxy. Whether or not you plan to attend the Inpixon special meeting, please vote as soon as possible by completing and returning the enclosed proxy card or vote by proxy over the telephone or on the internet as instructed on the proxy card to ensure your vote is counted.

Beneficial Owner: Shares Registered in the Name of a Broker or Bank

If, at the close of business on the Record Date, your shares of Inpixon common stock were not held in your name, but rather in an account at a brokerage firm, bank, dealer or other similar organization, then you are the beneficial owner of shares held in “street name” and these proxy materials are being forwarded to you by that organization. The organization holding your account is considered to be the stockholder of record for purposes of voting at the Inpixon special meeting. As a beneficial owner, you have the right to direct your broker or other agent how to vote the shares in your account. You are also invited to attend the Inpixon special meeting. However, because you are not the stockholder of record, you may not vote your shares virtually at the Inpixon special meeting unless you request and obtain a valid legal proxy from your broker or other agent, giving you the right to vote the shares at the Inpixon special meeting.

Q:     How many votes do I have?

A:     On each matter to be voted upon, you have one vote for each share of Inpixon common stock you own as of the Record Date.

Q:     What is the quorum requirement?

A:    A quorum of Inpixon stockholders is necessary to hold a valid meeting. A quorum will be present if Inpixon stockholders holding one-third of the issued and outstanding shares of Inpixon common stock entitled to vote at the Inpixon special meeting are present virtually or represented by proxy at the Inpixon special meeting. As of the Record Date, there were 127,688,550 shares of Inpixon common stock outstanding and entitled to vote. Accordingly, Inpixon expects that the holders of at least 42,562,850 shares of Inpixon common stock must be present at the Inpixon special meeting for a quorum to exist. Your shares of Inpixon common stock will be counted toward the quorum at the Inpixon special meeting only if you attend the Inpixon special meeting virtually or are represented at the Inpixon special meeting by proxy.

Abstentions will be counted towards the quorum requirement. If a quorum is not present at the Inpixon special meeting, the Inpixon stockholders holding a majority of the eligible votes present virtually or by proxy may adjourn the meeting to a later date. If an adjournment is for more than 60 days or a new record date is fixed for the adjourned meeting, notice will be provided of the adjourned meeting to each Inpixon stockholder of record entitled to vote at the meeting.

Q:     What are “broker non-votes?”

A:     If you hold shares beneficially in street name and do not provide your broker or other agent with voting instructions, your shares may constitute “broker non-votes.” Broker non-votes occur on a matter when banks, brokers and other nominees are not permitted to vote on certain non-discretionary matters without instructions from the beneficial owner and instructions are not given. These matters are referred to as “non-routine” matters. Proposal Nos. 1-4, 8 and 9 are anticipated to be non-routine matters. Proposal Nos. 5, 6 and 7 are anticipated to be routine matters and not be subject to broker non-vote. Broker non-votes will have no effect on the outcome of Proposal Nos. 1-5 and 7-9, and will be counted as votes against Proposal No. 6, the Authorized Share Increase Proposal.

Q:     When do you expect the merger to be consummated?

A:     Inpixon and XTI anticipate that the merger will occur shortly after the Inpixon special meeting to be held on December [    ], 2023, but the companies cannot predict the exact timing. For more information, please see the section entitled “The Merger Agreement-Conditions to the Completion of the Merger” in this proxy statement/prospectus.

Q:     What do I need to do now?

A:     Inpixon urges you to read this proxy statement/prospectus carefully, including its annexes, and to consider how the merger affects you.

As an Inpixon stockholder of record, you may provide your proxy instructions in one of two different ways. First, you can mail your signed proxy card in the enclosed return envelope. You may also provide your proxy instructions via telephone or via the Internet by following the instructions on your proxy card or voting instruction form. Please provide your proxy instructions only once, unless you are revoking a previously delivered proxy instruction, and as soon as possible so that your shares can be voted at the Inpixon special meeting.

Q:     What happens if I do not return a proxy card or otherwise provide proxy instructions, as applicable?

A:     If you are a stockholder of record and you return a signed proxy card without marking any selections, your shares will be voted “FOR” each of Proposal Nos. 1-9.

If you are a beneficial owner of shares of Inpixon common stock and do not instruct your broker, bank, or other agent how to vote your shares, the question of whether your broker or nominee will still be able to vote your shares depends on whether the matters are deemed “routine” or “non-routine” matters. Inpixon believes that each of Proposal Nos. 1-4, 8 and 9 is considered a “non-routine” matter, while each of Proposal Nos. 5, 6 and 7 is considered a “routine” matter and anticipated to not be subject to broker non-vote. Broker non-votes will have no effect on the outcome of Proposal Nos. 1-5 and 7-9, and will be counted as votes against Proposal No. 6, the Authorized Share Increase Proposal.

Q:     When and where is the Inpixon special meeting and may I vote virtually?

A:     The Inpixon special meeting will be held virtually at 10:00 A.M., Pacific Time, on December [    ], 2023. The Inpixon special meeting will be a completely virtual meeting of Inpixon Stockholders conducted via live virtual meeting. You will be able to attend the Inpixon special meeting by visiting www.virtualshareholdermeeting.com/INPX2023SM and entering your control number as further explained in the accompanying proxy statement/prospectus. If your shares of Inpixon common stock are registered directly in your name with Inpixon’s transfer agent, you are considered to be the stockholder of record with respect to those shares, and the proxy materials and proxy card are being sent directly to you by Inpixon. If you are a stockholder of record, you may attend the Inpixon special meeting and vote your shares virtually. Even if you plan to attend the Inpixon special meeting virtually, Inpixon requests that you sign and return the enclosed proxy to ensure that your shares will be represented at the Inpixon special meeting if you become unable to attend. If your shares of Inpixon common stock are held in a brokerage account or by another nominee, you are considered the beneficial owner of shares held in “street name,” and the proxy materials are being forwarded to you by your broker or other nominee together with a voting instruction card. As the beneficial owner, you are also invited to attend the Inpixon special meeting. Because a beneficial owner is not the stockholder of record, you may not vote these shares virtually at the Inpixon special meeting unless you obtain a proxy from the broker, trustee or nominee that holds your shares, giving you the right to vote the shares at the Inpixon special meeting.

Q:     If my Inpixon shares are held in “street name” by my broker, will my broker vote my shares for me?

A:     Unless your broker has discretionary authority to vote on certain matters, your broker will not be able to vote your shares of Inpixon common stock without instructions from you. Brokers are not expected to have discretionary authority to vote for Proposal Nos. 1-4, 8 and 9. To make sure that your vote is counted, you should instruct your broker to vote your shares, following the procedures provided by your broker.

RISK FACTORS

The combined company will be faced with a market environment that cannot be predicted and that involves significant risks, many of which will be beyond its control. In addition to the other information contained in this proxy statement/prospectus, you should carefully consider the material risks described below and those described in the section of this proxy statement/prospectus titled “Cautionary Statement Concerning Forward-Looking Statements” before deciding how to vote your shares of stock. You should also read and consider the other information in this proxy statement/prospectus. Please see the section titled “Where You Can Find More Information” in this proxy statement/prospectus.

Risks Related to the Merger

The merger is subject to the satisfaction of certain conditions, which may not be satisfied on a timely basis, if at all.

The merger is subject to approval by Inpixon stockholders, approval by Nasdaq of the listing of shares of Inpixon common stock to be issued in connection with the merger, and approval by Nasdaq of the initial listing of the combined company’s common stock on Nasdaq, as well as other conditions set forth in the Merger Agreement, which must be satisfied or waived to complete the merger. These conditions are set forth in the Merger Agreement and described in the section entitled “Conditions to Closing” in this proxy statement/prospectus. Inpixon and XTI cannot assure you that all of the conditions will be satisfied or waived. If the conditions are not satisfied or waived, the merger will not occur or will be delayed, and Inpixon and XTI each may lose some or all of the intended benefits of the merger.

Failure to complete the merger may result in either Inpixon or XTI paying a termination fee to the other party, as described in the section entitled “Termination” in this report. Payment by Inpixon of a termination fee could materially and adversely affect its financial condition and termination of the transaction could have a material adverse effect on the market price of Inpixon common stock and negatively affect its future business and operations.

Inpixon and XTI securityholders may not realize a benefit from the merger commensurate with the ownership dilution they will experience in connection with the merger.

Inpixon may not be able to achieve the full strategic and financial benefits expected to result from the merger. Further, such benefits, if ultimately achieved, may be delayed. If the combined company is unable to realize the full strategic and financial benefits currently anticipated from the merger, Inpixon stockholders and XTI stockholders will have experienced substantial dilution of their ownership interests in their respective companies, without receiving any commensurate benefit, or only receiving part of the commensurate benefit to the extent the combined company is able to realize only part of the strategic and financial benefits currently anticipated from the merger.

The market price of Inpixon common stock may also decline as a result of the merger for a number of reasons, including:

•        if investors react negatively to the prospects of the combined company’s product candidates and services, business and financial condition following the closing of the merger;

•        the effect of the merger on the combined company’s business and prospects is not consistent with the expectations of financial or industry analysts; or

•        the combined company does not achieve the perceived benefits of the merger as rapidly or to the extent anticipated by financial or industry analysts.

The Exchange Ratio set forth in the Merger Agreement is adjustable based on the Inpixon Net Cash, so the relative ownership of the combined company as between current Inpixon securityholders and current XTI securityholders may change based on, among other things, Inpixon’s interim cash burn prior to the closing and the extent to which any debt remains outstanding under the Streeterville Notes. Because the Exchange Ratio formula takes into account equity issuances by Inpixon and XTI between signing and closing, and because Inpixon intends to issue additional shares and raise additional capital between signing and closing, Inpixon’s stockholders will also experience dilution as a result of such issuances.

The Exchange Ratio set forth in the Merger Agreement is adjustable based on the Inpixon Net Cash, so the relative ownership of the combined company as between current Inpixon securityholders and current XTI securityholders may change based on, among other things, Inpixon’s interim cash burn prior to the closing and the extent to which

any debt remains outstanding under the Streeterville Notes as described in the section entitled “The Merger-Merger Consideration and Exchange Ratio.” Because the Exchange Ratio formula takes into account equity issuances by Inpixon and XTI between signing and closing, and because Inpixon intends to issue additional shares and raise additional capital between signing and closing, Inpixon’s stockholders will also experience dilution as a result of such issuances. See “Risk Factors — There may be future sales or other dilution of our equity, which may adversely affect the market price of our common stock.”

The merger consideration at the closing may have a greater or lesser value than at the time the Merger Agreement was signed.

The Merger Agreement has set the calculation of the Exchange Ratio for the XTI capital stock, and the Exchange Ratio is based on the fully-diluted capitalization of XTI and Inpixon, in each case immediately prior to the Closing as described in the section entitled “The Merger-Merger Consideration and Exchange Ratio.”

The Merger Agreement does not include a price-based termination right. Therefore, if before the completion of the merger the market price of Inpixon common stock declines from the market price on the date of the Merger Agreement, then XTI stockholders could receive merger consideration with substantially lower value than the value of such merger consideration on the date of the Merger Agreement. Similarly, if before the completion of the merger the market price of Inpixon common stock increases from the market price of Inpixon common stock on the date of the Merger Agreement, then XTI Stockholders could receive merger consideration with substantially greater value than the value of such merger consideration on the date of the Merger Agreement. Because the Exchange Ratio does not adjust as a direct result of changes in the market price of Inpixon common stock (other than to the extent such changes impact the calculation of the Inpixon Net Cash), changes in the market price of Inpixon common stock will change the value of the total merger consideration payable to XTI stockholders pursuant to the Merger Agreement.

Stock price changes may result from a variety of factors, including, but not limited to, changes in XTI’s or Inpixon’s respective businesses, operations and prospects, market assessments of the likelihood that the merger will be completed, interest rates, federal, state, and local legislation, governmental regulation, legal developments in the industry segments in which XTI or Inpixon operate, the timing of the merger, and general market, industry and economic conditions, including geopolitical tensions, pandemics and other public health emergencies.

Our stockholders may not have the same benefits as an investor in an underwritten public offering.

Inpixon is already a publicly traded company. Therefore, the merger and the transactions described in this proxy statement/prospectus are not an underwritten initial public offering of securities of the combined company and differ from an underwritten initial public offering in several significant ways.

For example, like other business combinations and spin-offs, in connection with the merger, our stockholders will not receive the benefits of the diligence that would customarily be performed by the underwriters in an underwritten public offering. Investors in an underwritten public offering may benefit from the role of the underwriters in such an offering. In an underwritten public offering, an issuer initially sells its securities to the public market via one or more underwriters, who distribute or resell such securities to the public. Underwriters have liability under the U.S. securities laws for material misstatements or omissions in a registration statement pursuant to which an issuer sells securities. Because the underwriters have a “due diligence” defense to any such liability by, among other things, conducting a reasonable investigation, the underwriters and their counsel conduct a due diligence investigation of the issuer. Due diligence entails engaging legal, financial and/or other experts to perform an investigation as to the accuracy of an issuer’s disclosure regarding, among other things, its business and financial results. Auditors of the issuer will also deliver a “comfort” letter with respect to the financial information contained in the registration statement. In making their investment decision, investors have the benefit of such diligence in underwritten public offerings. Our stockholders must rely on the information in this proxy statement/prospectus and will not have the benefit of an independent review and investigation of the type normally performed by an independent underwriter in a public securities offering. While private investors and management in a business combination undertake a certain level of due diligence, it is not necessarily the same level of due diligence undertaken by an underwriter in a public securities offering.

In addition, because there are no underwriters engaged in connection with the merger, prior to the opening of trading on the Nasdaq on the trading day immediately following the Closing, there will be no traditional “roadshow” or book building process, and no price at which underwriters initially sold shares to the public to help inform efficient and sufficient price discovery with respect to the initial post-closing trades on the Nasdaq. Therefore, buy and sell orders submitted prior to and at the opening of initial post-closing trading of our securities will not have the benefit

of being informed by a published price range or a price at which the underwriters initially sold shares to the public, as would be the case in an underwritten initial public offering. There will be no underwriters assuming risk in connection with an initial resale of our securities or helping to stabilize, maintain or affect the public price of our securities following the Closing. Moreover, we will not engage in, and have not and will not, directly or indirectly, request financial advisors to engage in, any special selling efforts or stabilization or price support activities in connection with our securities that will be outstanding immediately following the Closing. No assurance can be given that brokerage firms will, in the future, want to conduct any offerings on the combined company’s behalf. All of these differences from an underwritten public offering of the combined company’s securities could result in a more volatile price for the combined company’s securities.

Such differences from an underwritten public offering may present material risks to unaffiliated investors that would not exist if XTI became a publicly listed company through an underwritten initial public offering instead or upon completion of the merger.

The historical unaudited pro forma condensed combined financial information may not be representative of the combined company’s results after the merger.

The historical unaudited pro forma condensed combined financial information included elsewhere in this proxy statement/prospectus has been presented for informational purposes only and is not necessarily indicative of the financial position or results of operations that actually would have occurred had the merger been completed as of the date indicated, nor is it indicative of future operating results or financial position.

Some Inpixon and XTI officers and directors have interests in the merger that are different from the respective stockholders of Inpixon and XTI and that may influence them to support or approve the merger without regard to the interests of the respective stockholders of Inpixon and XTI.

Certain officers and directors of Inpixon and XTI participate in arrangements that provide them with interests in the merger that are different from the interests of the respective stockholders of Inpixon and XTI, including, among others, the continued service as an officer or director of the combined company, severance benefits, the acceleration of stock option vesting, continued indemnification and the potential ability to sell an increased number of shares of common stock of the combined company in accordance with the Securities Act or pursuant to a registration statement. For example, certain of Inpixon’s named executive officers and a director will receive transaction bonuses under the Inpixon Transaction Bonus Plan described in the sections entitled “The Merger-Interests of Inpixon Directors and Executive Officers in the Merger” and “Inpixon Executive Compensation-Director Compensation” in this proxy statement/prospectus.

These interests, among others, may influence such officers and directors of Inpixon and XTI to support or approve the merger. For more information concerning the interests of Inpixon’s and XTI’s respective officers and directors, see the sections entitled “The Merger-Interests of Inpixon Directors and Executive Officers in the Merger” and “The Merger-Interests of XTI Directors and Executive Officers in the Merger” in this proxy statement/prospectus.

Failure to complete the merger may result in either Inpixon or XTI paying a termination fee to the other party and could significantly harm the market price of Inpixon common stock and negatively affect the future business and operations of each company.

If the merger is not completed and the Merger Agreement is terminated under certain circumstances, Inpixon or XTI may be required to pay the other party a termination fee of $2,000,000, and Future Loans and Existing Loans from Inpixon to XTI may be accelerated, forgiven or the maturity date of such loans may be extended, depending on the circumstances of the termination as set forth in the Merger Agreement. Even if a termination fee or expenses of the other party are not payable in connection with a termination of the Merger Agreement, each of Inpixon and XTI will have incurred significant fees and expenses, which must be paid whether or not the merger is completed. Further, if the merger is not completed, it could significantly harm the market price of Inpixon common stock and raise serious doubts as to its ability to continue as an entity.

In addition, if the Merger Agreement is terminated and the Inpixon Board or XTI Board determines to seek another business combination, there can be no assurance that either Inpixon or XTI will be able to find a partner and close an alternative transaction on terms that are as favorable or more favorable than the terms set forth in the Merger Agreement.

The market price of Inpixon common stock following the merger may decline as a result of the merger.

The market price of Inpixon common stock may decline as a result of the Proposed Transaction for a number of reasons, including if:

•        investors react negatively to the prospects of the combined company’s business and financial condition following the merger;

•        the effect of the merger on the combined company’s business and prospects is not consistent with the expectations of financial or industry analysts; or

•        the combined company does not achieve the perceived benefits of the merger as rapidly or to the extent anticipated by financial or industry analysts.

The issuance of Inpixon common stock to XTI equityholders pursuant to the Merger Agreement and the resulting change in control from the merger must be approved by Inpixon stockholders. Failure to obtain these approvals would prevent the closing of the merger.

Before the merger can be completed, the Inpixon stockholders must approve, among other things, the issuance of Inpixon common stock to XTI equityholders pursuant to the Merger Agreement and the resulting change in control from the merger. Failure to obtain the required stockholder approval may result in a material delay in, or the abandonment of, the merger. Any delay in completing the merger may materially adversely affect the timing and benefits that are expected to be achieved from the merger.

The merger may be completed even though certain events occur prior to the closing that materially and adversely affect Inpixon or XTI.

The Merger Agreement provides that either Inpixon or XTI can refuse to complete the merger if there is a material adverse change affecting the other party between July 24, 2023, the date of the Merger Agreement, and the closing. However, certain types of changes do not permit either party to refuse to complete the merger, even if such change could be said to have a material adverse effect on Inpixon or XTI, including:

•        any adverse change, effect, event or occurrence, state of facts or developments as a result of the public announcement or the pendency of the Merger Agreement or the transactions contemplated thereby or any actions required to be taken (or refrained from being taken) in compliance therewith, including any action taken (or omitted to be taken) with the written consent of or at the written request of the other parties to the Merger Agreement (as applicable);

•        changes generally affecting the industries in which the XTI, Inpixon or Inpixon’s Subsidiaries operate that are not specifically related to XTI, Inpixon or Inpixon’s Subsidiaries and do not have a materially disproportionate adverse effect on XTI, Inpixon or Inpixon’s Subsidiaries, taken as a whole;

•        changes in general economic conditions or political conditions, or in the financial, credit or securities markets in general (including changes in the prevailing interest rates, exchange rates or stock, bond and/or debt prices) in the United States, in any region thereof, or in any non-U.S. or global economy that do not have a materially disproportionate adverse effect on XTI, Inpixon or Inpixon’s Subsidiaries, taken as a whole any attack on, or by, outbreak or escalation of hostilities or acts of terrorism (including cyberterrorism) involving, the United States, or any declaration of war by the United States Congress or any hurricane or other natural disaster, or epidemics, pandemics or public health emergencies (as declared by the World Health Organization or the Health and Human Services Secretary of the United States);

•        any failure to meet financial projections, estimates or forecasts for any period;

•        the taking of any action by the parties or any of their Affiliates (including any breach of the Merger Agreement committed thereby);

•        any matter set forth in the Parent Disclosure Letter or the Company Disclosure Letter;

•        with respect to Inpixon, any change in the market price or trading volume of its common stock on Nasdaq, excluding any underlying effect that may have caused such change, unless such effect is otherwise exempt from causing a material adverse effect under the Merger Agreement;

•        any adverse change in the consolidated financial results of Inpixon that is not materially worse than Inpixon’s historic negative consolidated financial results and historic negative trends.

If adverse changes occur and Inpixon and XTI still complete the merger, the market price of the combined company’s common stock may suffer. This in turn may reduce the value of the merger to the stockholders of Inpixon, XTI or both.

Inpixon and XTI securityholders will have a reduced ownership and voting interest in, and will exercise less influence over the management of, the combined company following the closing as compared to their current ownership and voting interest in the respective companies.

If the proposed merger is completed, the current securityholders of Inpixon and XTI will own a smaller percentage of the combined company than their ownership in their respective companies prior to the merger. Accordingly, the issuance of shares of Inpixon common stock to XTI equityholders in the merger will reduce significantly the relative voting power of each share of Inpixon common stock held by its current stockholders and will reduce the relative voting power of each share of XTI common stock held by its current stockholders. Consequently, Inpixon stockholders as a group and XTI stockholders as a group will have less influence over the management and policies of the combined company after the merger than prior to the merger.

In addition, the board of directors for the post-merger combined company is expected to be comprised of five directors and the chief executive officer of the combined company will be Scott Pomeroy. Two directors will have been nominated by Inpixon prior to the Closing, at least one of which will be an independent director. Consequently, securityholders of both Inpixon and XTI will be able to exercise less influence over the management and policies of the combined company following the Closing than they currently exercise over the management and policies of their respective companies.

The combined company will need to raise additional capital by issuing securities or debt or other strategic arrangements, which may cause dilution to the combined company’s stockholders or restrict the combined company’s operations.

The combined company may be required to raise additional funds sooner than currently planned. If either or both of Inpixon or XTI hold less cash at the time of the closing than the parties currently expect, the combined company will need to raise additional capital sooner than expected. Additional financing may not be available to the combined company when it needs it or may not be available on favorable terms. To the extent that the combined company raises additional capital by issuing equity securities, such an issuance may cause significant dilution to the combined company’s stockholders’ ownership and the terms of any new equity securities may have preferences over the combined company’s common stock. Any debt financing the combined company enters into may involve covenants that restrict its operations. These restrictive covenants may include limitations on additional borrowing and specific restrictions on the use of the combined company’s assets, as well as prohibitions on its ability to create liens, pay dividends, redeem its stock or make investments.

These restrictive covenants could deter or prevent the combined company from raising additional capital as and when needed. The combined company’s failure to raise capital as and when needed would have a negative effect on its financial condition and its ability to develop and commercialize its aircraft and otherwise pursue the combined company’s business strategy and the combined company may be unable to continue as a going concern.

During the pendency of the merger, Inpixon and XTI may not be able to enter into a business combination with another party at a favorable price because of restrictions in the Merger Agreement, which could adversely affect their respective businesses.

Covenants in the Merger Agreement impede the ability of Inpixon and XTI to make acquisitions, subject to certain exceptions relating to fiduciary duties, as set forth below, or to complete other transactions that are not in the ordinary course of business pending completion of the merger. As a result, if the merger is not completed, the parties may be at a disadvantage to their competitors during such period. In addition, while the Merger Agreement is in

effect, each party is generally prohibited from soliciting, initiating, encouraging or entering into certain extraordinary transactions, such as a merger, sale of assets, or other business combination outside the ordinary course of business with any third party, subject to certain exceptions relating to fiduciary duties. Any such transactions could be favorable to such party’s stockholders.

Certain provisions of the Merger Agreement may discourage third parties from submitting alternative takeover proposals, including proposals that may be superior to the arrangements contemplated by the Merger Agreement.

The terms of the Merger Agreement prohibit each of Inpixon and XTI from soliciting, negotiating, authorizing, recommending, entering into or proposing to enter into any alternative acquisition proposals, or continuing to engage in discussions with any third party concerning any acquisition proposal, or encourage, solicit or initiate discussions, negotiations or submissions of proposals, indications of interest or offers in respect of an Acquisition Proposal, or furnish or cause to be furnished to any person any information in furtherance of an Acquisition Proposal, except in limited circumstances when such party’s board of directors determines in good faith that an unsolicited alternative takeover proposal is or is reasonably likely to lead to a superior takeover proposal and that failure to cooperate with the proponent of the proposal would be reasonably likely to be inconsistent with the applicable board’s fiduciary duties. As XTI has received stockholder approval for the merger, XTI is unable to terminate the Merger Agreement on the basis of any such “fiduciary out” provisions contained in the Merger Agreement. Any such transactions could be favorable to such party’s stockholders. In addition, if Inpixon terminates the Merger Agreement under certain circumstances, including terminating because of a decision of Inpixon to enter into definitive agreement with respect to a superior offer, Inpixon would be required to pay a termination fee of $2,000,000 to XTI, and all outstanding principal and accrued but unpaid interest in respect of the principal sum of $2,025,000 which Inpixon previously advanced to XTI, together with any Future Loans advanced under the Inpixon Promissory Note shall be forgiven. This termination fee described above may discourage third parties from submitting alternative takeover proposals to Inpixon stockholders.

Because the lack of a public market for XTI common stock makes it difficult to evaluate the value of XTI common stock, the XTI stockholders may receive shares of Inpixon common stock in the merger that have a value that is less than, or greater than, the fair market value of XTI common stock.

The outstanding common stock of XTI is privately held and is not traded in any public market. The lack of a public market makes it extremely difficult to determine the fair market value of XTI. Because the percentage of Inpixon common stock to be issued to XTI stockholders was determined based on negotiations between the parties, it is possible that the value of Inpixon common stock to be received by XTI stockholders will be less than the fair market value of XTI, or Inpixon may pay more than the aggregate fair market value for XTI.

Inpixon and XTI do not anticipate that the combined company will pay any cash dividends in the foreseeable future.

The current expectation is that the combined company will retain its future earnings, if any, to fund the development and growth of the combined company’s business. As a result, capital appreciation, if any, of the common stock of the combined company will be your sole source of gain, if any, for the foreseeable future.

Future sales of shares by existing stockholders could cause the combined company’s stock price to decline.

If existing stockholders of Inpixon and XTI sell, or indicate an intention to sell, substantial amounts of the combined company’s common stock in the public market after the merger, the trading price of the common stock of the combined company could decline.

The opinion received by the Inpixon Board from GVS is subject to a number of assumptions and it has not been, and is not expected to be, updated to reflect changes in circumstances that may have occurred since the date of the opinion.

GVS delivered its opinion to the Inpixon Board that, as of July 24, 2023, and based upon and subject to the qualifications, assumptions and other matters considered in connection with the preparation of its opinion, the Exchange Ratio was fair, from a financial point of view, to the Inpixon stockholders. GVS’s opinion was based on a number of assumptions including, among other things, that Inpixon stockholders would own approximately 40% of the outstanding common stock of the combined company immediately following consummation of the merger. The GVS opinion did not take into account any post-Closing dilutive issuances of Inpixon securities. See “Risk Factors-Inpixon and XTI

Securityholders may not realize a benefit from the merger commensurate with the ownership dilution they will experience in connection with the merger.” The GVS opinion does not reflect changes that may occur or may have occurred after the date of the opinion, including changes to Inpixon’s or XTI’s capitalization or changes to the estimated Inpixon Net Cash on the Anticipated Closing Date (as determined pursuant to the Merger Agreement). Any such changes may materially alter or affect the relative ownership percentages of Inpixon stockholders and XTI stockholders.

In addition, in conducting its implied multiple and implied value reference range analysis, GVS also reviewed and analyzed certain internal financial analyses, reports, preliminary internal market opportunity assumptions and other information concerning XTI prepared by the management of XTI. XTI management did not furnish any projections regarding XTI’s future cash flows, EBITDA, or other metrics to any directors of Inpixon other than the CEO and CFO. GVS did not rely on any projections regarding XTI’s future cash flows, EBITDA, or other metrics furnished by XTI management. Moreover, Inpixon management did not furnish any projections regarding XTI’s future cash flows, EBITDA, or other metrics to the Inpixon Board or to GVS. GVS expressed no opinion as to the financial analyses and other information or the assumptions upon which they were based and relied upon them without independent verification. GVS did not assume any responsibility for the accuracy or completeness of the financial information. In performing its analyses, GVS also made numerous assumptions with respect to industry performance, general business, economic and regulatory conditions and other matters, many of which are beyond the control of Inpixon or XTI. These assumptions are subject to significant economic, competitive, industry and other uncertainties and contingences, all of which are difficult or impossible to predict and many of which are beyond the control of Inpixon and XTI. GVS has not and does not intend to update, revise or reaffirm its opinion to reflect subsequent developments. See the section entitled “The Merger — Opinion of Gemini Valuation Services” beginning on page 81 and Annex B of this proxy statement/prospectus.

The pendency of the merger could have an adverse effect on the trading price of Inpixon common stock and its business, financial condition and prospects.

The pendency of the merger could disrupt Inpixon’s business in many ways, including:

•        the attention of its remaining management and employees may be directed toward the completion of the merger and related matters and may be diverted from Inpixon’s day-to-day business operations; and

•        third parties may seek to terminate or renegotiate their relationships with Inpixon as a result of the merger, whether pursuant to the terms of their existing agreements with Inpixon or otherwise.

Should they occur, any of these matters could adversely affect the trading price of Inpixon common stock or harm its business, financial condition and prospects.

If Inpixon fails to comply with the continued listing standards of the Nasdaq Capital Market, Inpixon common stock could be delisted. If it is delisted, Inpixon common stock and the liquidity of its common stock would be impacted.

The continued listing of Inpixon common stock on Nasdaq is contingent on Inpixon’s continued compliance with a number of listing standards. There is no assurance that Inpixon will remain in compliance with these standards. Delisting from Nasdaq would adversely affect Inpixon’s ability to consummate the merger, raise additional financing through the public or private sale of equity securities, significantly affect the ability of investors to trade Inpixon’s securities and negatively affect the value and liquidity of Inpixon common stock. Delisting also could limit Inpixon’s strategic alternatives and attractiveness to potential counterparties and have other negative results, including the potential loss of employee confidence, the loss of institutional investors or interest in business development opportunities. Moreover, Inpixon committed in connection with the sale of securities to use commercially reasonable efforts to maintain the listing of its common stock during such time that certain warrants are outstanding.

The merger may fail to qualify as a “reorganization” within the meaning of Section 368(a) of the Code.

Inpixon and XTI each intends and expects the merger to qualify as a “reorganization” within the meaning of Section 368(a) of the Code. However, Inpixon and XTI cannot guarantee that the Internal Revenue Service will not challenge the intended tax treatment of the merger, and that such a challenge will not be successful. If the merger were to fail to qualify as a reorganization within the meaning of Section 368(a) of the Code, then the consequences to holders of XTI common stock who exchange their XTI common stock for Inpixon common stock in the merger would be materially different than as described in this joint proxy statement/prospectus and holders of XTI common stock could be subject to U.S. federal income tax with respect to the receipt of Inpixon common stock in the merger. Therefore, you should consult your own tax advisor to determine the particular tax consequences to you if the merger fails to qualify as a reorganization.

Litigation relating to the merger could require Inpixon or XTI to incur significant costs and suffer management distraction, and could delay or enjoin the merger.

On August 21, 2023, a purported Inpixon shareholder filed a lawsuit in the United States District Court for the Northern District of California against Inpixon and its directors. Another shareholder filed a substantially similar suit in the same court against the same parties on August 24, 2023. The cases are styled Busby v. Inpixon, Case No. 3:23-cv-04249 (N.D. Cal.) and Panovski v. Inpixon, Case No. 4:23-cv-04330-KAW (N.D. Cal.). Both suits allege that Inpixon filed a purportedly misleading Form S-4 on August 14, 2023 that omits material information regarding the process leading to the merger and the analysis performed by Inpixon’s financial advisor in connection with the merger. The suits assert claims under Section 14(a) and Section 20 of the Securities Exchange Act and seek injunctive relief, damages, costs, attorneys’ fees, and other relief. Inpixon has also received demand letters from multiple purported Inpixon shareholders alleging that the Form S-4 omits or misstates material information regarding similar topics as alleged in the lawsuits, as well as material information pertaining to other topics, including information pertaining to the compensation and business or financial relationships of Inpixon’s financial advisor for the proposed transaction. The letters demand that Inpixon make supplemental disclosures to correct the alleged misstatements and omissions. It is possible that Inpixon may be named in additional suits or receive additional demand letters containing similar allegations or asserting additional allegations or claims regarding the merger.

While Inpixon does not believe the above demands and claims will hinder the merger, Inpixon and XTI could be subject to additional demands or litigation related to the merger, whether or not the merger is consummated. Regardless of the merits of any particular claim, such actions may create uncertainty relating to the merger, or delay or enjoin the merger, and responding to such actions could divert time, resources and management’s attention away from Inpixon’s or XTI’s business operations, as applicable.

Risks Related to Inpixon

In addition to the other information contained in this proxy statement/prospectus, including the matters addressed under the heading “Forward-Looking Statements,” you should carefully consider the following risk factors in deciding how to vote on the proposals presented in this proxy statement/prospectus. The risk factors described below disclose both material and other risks and are not intended to be exhaustive and are not the only risks facing us. Additional risks not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition, results of operations and cash flows in future periods or are not identified because they are generally common to businesses.

Unless the context otherwise requires, all references in this section to “we,” “us” or “our” refer to Inpixon.

Risks Related to Inpixon’s Business

We have had a strategic acquisition strategy and since 2014 have completed several strategic transactions including acquisitions and dispositions. We completed the spin-off of our VAR business in August 2018, which included our legacy value added reseller business and the Enterprise Apps Spin-off in March 2023, which may make it difficult for potential investors to evaluate our future business. Furthermore, due to the risks and uncertainties related to the acquisition of new businesses, any such acquisition does not guarantee that we will be able to attain profitability.

We have a strategic acquisition strategy and since 2014 we completed several strategic transactions and spin-offs. In August 2018, we completed the spin-off of our VAR business, and in 2019 we completed several other acquisition transactions to expand our product portfolio. In 2020, we acquired the Nanotron business, an exclusive license for the distribution and marketing of the SAVES software expanding our operations in the United Kingdom and Germany. In 2021, we acquired 100% of the outstanding capital stock of IntraNav GmbH, an industrial IoT (IIoT), real-time location system (RTLS), and sensor data services provider and 100% of the outstanding capital stock of Design Reactor, Inc. In 2023, we completed the spin-off of our enterprise apps business. Our limited operating history after such acquisitions and divestiture makes it difficult for potential investors to evaluate our business or prospective operations or the merits of an investment in our securities. With respect to acquisitions, we are subject to the risks inherent in the financing, expenditures, complications and delays characteristic of a newly combined business. These risks are described below under the risk factor titled “Any future acquisitions that we may make could disrupt our business, cause dilution to our stockholders and harm our business, financial condition or operating results.” In addition, while the Company has received indemnification protections in connection with these acquisitions from

undisclosed liabilities, there may not be adequate resources to cover such indemnity. Furthermore, there are risks that the vendors, suppliers and customers of any of the businesses we have acquired may not renew their relationships for which there is no indemnification. Accordingly, our business and success faces risks from uncertainties inherent to developing companies in a competitive environment. There can be no assurance that our efforts will be successful or that we will ultimately be able to attain profitability.

We may not be able to successfully integrate the business and operations of entities that we have acquired or may acquire in the future into our ongoing business operations, which may result in our inability to fully realize the intended benefits of these acquisitions, or may disrupt our current operations, which could have a material adverse effect on our business, financial position and/or results of operations.

We continue to integrate the technology and operations acquired in connection with our recent acquisitions, including but not limited to the Nanotron technology and operations. This process involves complex operational, technological and personnel-related challenges, which are time-consuming and expensive and may disrupt our ongoing business operations. Furthermore, integration involves a number of risks, including, but not limited to:

•        difficulties or complications in combining the companies’ operations;

•        differences in controls, procedures and policies, regulatory standards and business cultures among the combined companies;

•        the diversion of management’s attention from our ongoing core business operations;

•        increased exposure to certain governmental regulations and compliance requirements;

•        the potential increase in operating costs;

•        the potential loss of key personnel;

•        the potential loss of key customers or suppliers who choose not to do business with the combined business;

•        difficulties or delays in consolidating the acquired companies’ technology platforms, including implementing systems designed to maintain effective disclosure controls and procedures and internal control over financial reporting for the combined company and enable the Company to continue to comply with U.S. GAAP and applicable U.S. securities laws and regulations;

•        unanticipated costs to successfully integrate operations, technologies, personnel of acquired businesses and other assumed contingent liabilities;

•        difficulty comparing financial reports due to differing financial and/or internal reporting systems;

•        making any necessary modifications to internal financial control standards to comply with the Sarbanes-Oxley Act of 2002 and the rules and regulations promulgated thereunder; and/or

•        possible tax costs or inefficiencies associated with integrating the operations of the combined company.

These factors could cause us to not fully realize the anticipated financial and/or strategic benefits of the acquisitions and the recent reorganization, which could have a material adverse effect on our business, financial condition and/or results of operations.

Even if we are able to successfully operate the acquired businesses, we may not be able to realize the revenue and other synergies and growth that we anticipated from these acquisitions in the time frame that we currently expect, and the costs of achieving these benefits may be higher than what we currently expect, because of a number of risks, including, but not limited to:

•        the possibility that the acquisition may not further our business strategy as we expected;

•        the possibility that we may not be able to expand the reach and customer base for the acquired companies’ current and future products as expected;

•        the possibility that we may have entered a market with no prior experience and may not succeed in the manner expected; and

•        the possibility that the carrying amounts of goodwill and other purchased intangible assets may not be recoverable.

As a result of these risks, the acquisitions and integration may not contribute to our earnings as expected, we may not achieve expected revenue synergies or our return on invested capital targets when expected, or at all, and we may not achieve the other anticipated strategic and financial benefits of the acquisitions and the reorganization.

The risks arising with respect to the historic business and operations of our recent acquisition targets may be different from what we anticipate, which could significantly increase the costs and decrease the benefits of the acquisition and materially and adversely affect our operations going forward.

Although we performed significant financial, legal, technological and business due diligence with respect to our recent acquisition targets, we may not have appreciated, understood or fully anticipated the extent of the risks associated with the acquisitions. We have secured indemnification for certain matters in connection with our recent acquisitions in order to mitigate the consequences of breaches of representations, warranties and covenants under the applicable merger or acquisition agreements and the risks associated with historic operations, including those with respect to compliance with laws, accuracy of financial statements, financial reporting controls and procedures, tax matters and undisclosed liabilities, and certain matters known to us. We believe that the indemnification provisions of the merger agreements, together with any applicable holdback escrows and insurance policies that we have in place will limit the economic consequences of the issues we have identified in our due diligence to acceptable levels. Notwithstanding our exercise of due diligence and risk mitigation strategies, the risks of acquiring target companies with historic businesses and operations may expose us to unknown or contingent liabilities and the costs associated with these risks may be greater than we anticipate causing material and adverse impact on our business, liquidity, capital resources or results of operations.

The Business Combination is expected to cause the Enterprise Apps Spin-off to become taxable to Inpixon.

Although the Enterprise Apps Spin-off was expected to qualify as a tax-free transaction under Section 355 of the Code for Inpixon’s shareholders, the consummation of this Business Combination and the issuance of Inpixon common stock pursuant to the Merger Agreement is expected to cause the Enterprise Apps Spin-off to become taxable to Inpixon pursuant to the applicable of Section 355(e) of the Code. Although the Enterprise Apps Spin-off is expected to be taxable to Inpixon, Inpixon does not expect to recognize any material taxable income as a result of the transaction being taxable to it.

The lasting effects of the COVID-19 pandemic could adversely affect our business, operations, financial condition and results of operations, and the extent to which the effects of the pandemic will impact our business, operations, financial condition and results of operations remains uncertain.

While the unprecedented challenges posed by the COVID-19 pandemic over the last few years are subsiding, there continue to be lasting effects that may continue to result in significant volatility and business and economic disruptions and uncertainty. We have taken steps to protect our employees and we continue to operate all of our services, but the extent to which the remaining effects of the pandemic will impact our business, operations, financial condition and results of operations is uncertain, and hard to predict and will depend on numerous evolving factors that we may not be able to control or predict including:

•        the duration and scope of the pandemic;

•        the extent to which the national, local and regional government authorities would have taken action to control and prevent the spread of more contagious or lethal variants that may emerge;

•        the extent and effectiveness of responsive actions by authorities and the impact of these and other factors on our employees, customers and vendors;

•        the impact of the pandemic on our employees, including key personnel;

•        the extent to which we are able to maintain and replace critical internet infrastructure components, when necessary;

•        any disruption of our supply chain and the impact of such disruptions on our suppliers or our ability to deliver products and services to our customers;

•        our continued ability to execute on business continuity plans for the maintenance of our critical internet infrastructure, while most of our employees continue to work remotely; and

•        any negative impact on the demand for our services and products resulting from the economic disruption caused by the pandemic and responses thereto.

If we are unable to successfully respond to and manage the impact of the pandemic, and the resulting responses to it, our business, operations, financial condition and results of operations could be adversely impacted.

The ongoing impact of the military conflict between Russia and Ukraine has resulted in an increase in the likelihood of supply chain constraints, contributed to inflation driving up the cost of material and labor required to make our products, the effects of which remains uncertain and may have a material adverse impact on our business, operations and financial conditions.

The ongoing military conflict between Russia and Ukraine has increased the likelihood of supply interruptions which may hinder our ability to find the materials we need to make our products. Supply disruptions are making it harder for us to find favorable pricing and reliable sources for the materials we need, putting upward pressure on our costs and increasing the risk that we may be unable to acquire the materials and services we need to continue to make certain products. The wider implications of the conflict have contributed to inflation driving up the costs of labor and materials required to make our products. The fluidity and continuation of the conflict may result in additional economic sanctions and other impacts which could have a negative impact on the Company’s financial condition, results of operations and cash flows, including decreased sales; supply chain and logistics disruptions; volatility in foreign exchange rates and interest rates; inflationary pressures on materials and labor; and heightened cybersecurity threats. The overall impact on our business of these events continues to remain uncertain and there are no assurances that we will be able to continue to experience the same growth or not be materially adversely affected.

A significant portion of the purchase price related to our strategic acquisitions are allocated to goodwill and intangible assets that are subject to periodic impairment evaluations. An impairment loss could have a material adverse impact on our financial condition and results of operations.

A significant portion of the purchase price related to our strategic acquisitions are allocated to goodwill and intangible assets that are subject to periodic impairment evaluations. An impairment loss could have a material adverse impact on our financial condition and results of operations. As of December 31, 2022 we had no goodwill and the net book value of our intangible assets is approximately $22.3 million in connection with the various acquisitions that we have consummated.

As required by current accounting standards, we review intangible assets for impairment either annually or whenever changes in circumstances indicate that the carrying value may not be recoverable. The risk of impairment to goodwill is higher during the early years following an acquisition. This is because the fair values of these assets align very closely with what we paid to acquire the reporting units to which these assets are assigned. As a result, the difference between the carrying value of the reporting unit and its fair value (typically referred to as “headroom”) is smaller at the time of acquisition. Until this headroom grows over time, due to business growth or lower carrying value of the reporting unit, a relatively small decrease in reporting unit fair value can trigger impairment charges. When impairment charges are triggered, they tend to be material due to the size of the assets involved. Our business could be adversely affected, and impairment of goodwill could be triggered, if any of the following were to occur: higher attrition rates than planned as a result of the competitive environment or our inability to provide products and services that are competitive in the marketplace, lower-than-planned adoption rates by customers, higher-than-expected expense levels to provide services to customers, sustained declines in our stock price and related market capitalization and changes in our business model that may impact one or more of these variables. During the years ended December 31, 2022 and 2021 we recorded a goodwill and intangibles impairment charge of $12.2 million and $14.8 million, respectively. As of December 31, 2022 our goodwill was fully impaired.

Our ability to successfully execute our business plan may require additional debt or equity financing, which may otherwise not be available on reasonable terms or at all.

Based on our current business plan, we will need additional capital to support our operations, which may be satisfied with additional debt or equity financings. Future financings through equity offerings by us will be dilutive to existing stockholders. In addition, the terms of securities we may issue in future capital transactions may be more favorable to new investors than our current investors. Newly issued securities may include preferences, superior voting rights, and the issuance of warrants or other derivative securities. We may also issue incentive awards under our equity incentive plans, which may have additional dilutive effects. We may also be required to recognize non-cash expenses in connection with certain securities we may issue in the future such as convertible notes and warrants, which would adversely impact our financial condition and results of operations. Our ability to obtain needed financing may be impaired by factors, including the condition of the economy and capital markets, both generally and specifically in our industry, and the fact that we are not profitable, which could affect the availability or cost of future financing. If the amount of capital we are able to raise from financing activities, together with our revenues from operations, is not sufficient to satisfy our capital needs, we may need to reduce our operations by, for example, selling certain assets or business segments.

Failure to manage or protect growth may be detrimental to our business because our infrastructure may not be adequate for expansion.

Since its formation, our Company has grown significantly with increases in employee headcounts, product lines, physical locations across several countries, and managing of multiple relationships as well as interactions with users, distributors, vendors and other third parties. Our acquisitions may require substantial expansion of our systems, workforce and facilities and our corporate strategy includes plans for continued acquisitions of complementary technologies and businesses in furtherance of our growth plans. We may fail to adequately manage our anticipated future growth. The substantial growth in our operations as a result of our acquisitions has, and is expected to continue to, place a significant strain on our administrative, financial and operational resources, and increase demands on our management and on our operational and administrative systems, controls and other resources. There can be no assurance that our systems, procedures and controls will be adequate to support our operations as they expand. We cannot assure you that our existing personnel, systems, procedures or controls will be adequate to support our operations in the future or that we will be able to successfully implement appropriate measures consistent with our growth strategy. As part of this growth, we may have to implement new operational and financial systems, procedures and controls to expand, train and manage our employee base, and maintain close coordination among our staff. We cannot guarantee that we will be able to do so, or that if we are able to do so, we will be able to effectively integrate them into our existing staff and systems.

Our corporate strategy contemplates potential future acquisitions and to the extent we acquire other businesses, we will also need to integrate and assimilate new operations, technologies and personnel. The integration of new personnel will continue to result in some disruption to ongoing operations. The ability to effectively manage growth in a rapidly evolving market requires effective planning and management processes. We will need to continue to improve operational, financial and managerial controls, reporting systems and procedures, and will need to continue to expand, train and manage our work force. There can be no assurance that the Company would be able to accomplish such an expansion on a timely basis. If the Company is unable to effect any required expansion and is unable to perform its contracts on a timely and satisfactory basis, its reputation and eligibility to secure additional contracts in the future could be damaged. The failure to perform could also result in contract terminations and significant liability, and prompt the Company to restructure the organization or abandon the business of an acquired business. Any such result would adversely affect the Company’s business and financial condition.

We have a history of operating losses and working capital deficiency and there is no assurance that we will be able to achieve profitability or raise additional financing.

We have a history of operating losses and working capital deficiency. We have incurred net losses attributable to the stockholders of Inpixon of approximately $63.4 million and $69.2 million for the fiscal years ended December 31, 2022 and 2021, respectively. This decrease in loss of approximately $5.8 million was primarily attributable to the higher gross margin of $2.3 million, decreased operating expenses of $13.7 million, larger non-controlling interest of $1.9 million offset by greater other losses of $10.9 million and lower income tax benefit of $1.3 million. The continuation of our Company is dependent upon attaining and maintaining profitable operations and raising additional capital as needed, but there can be no assurance that we will be able to raise any further financing.

Our ability to generate positive cash flow from operations is dependent upon sustaining certain cost reductions and generating sufficient revenues. While our revenues have increased by 21% as compared to the same period for 2021, they are not sufficient to fund our operations and cover our operating losses. Our management is evaluating options and strategic transactions and continuing to market and promote our new products and technologies, however, there is no guarantee that these efforts will be successful or that we will be able to achieve or sustain profitability. We have funded our operations primarily with proceeds from public and private offerings of our common stock and secured and unsecured debt instruments. Our history of operating losses and cash uses, our projections of the level of cash that will be required for our operations to reach profitability, and the terms of the financing transactions that we completed in the past, may impair our ability to raise capital on terms that we consider reasonable and at the levels that we will require over the coming months. We cannot provide any assurances that we will be able to secure additional funding from public or private offerings or debt financings on terms acceptable to us, if at all. If we are unable to obtain the requisite amount of financing needed to fund our planned operations, it would have a material adverse effect on our business and ability to continue as a going concern, and we may have to curtail, or even to cease, certain operations. If additional funds are raised through the issuance of equity securities or convertible debt securities, it will be dilutive to our stockholders and could result in a decrease in our stock price.

Our business depends on experienced and skilled personnel, and if we are unable to attract and integrate skilled personnel, it will be more difficult for us to manage our business and complete contracts.

The success of our business depends on the skill of our personnel. Accordingly, it is critical that we maintain, and continue to build, a highly experienced management team and specialized workforce, including those who create software programs and sales professionals. Competition for personnel with skill sets specific to our industry is high, and identifying candidates with the appropriate qualifications can be costly and difficult. We may not be able to hire the necessary personnel to implement our business strategy given our anticipated hiring needs, or we may need to provide higher compensation or more training to our personnel than we currently anticipate.

Our business is labor intensive and our success depends on our ability to attract, retain, train, educate, and motivate highly skilled employees, including employees who may become part of our organization in connection with our acquisitions. The increase in demand for consulting, technology integration and managed services has further increased the need for employees with specialized skills or significant experience in these areas. Our ability to expand our operations will be highly dependent on our ability to attract a sufficient number of highly skilled employees and to retain our employees and the employees of companies that we have acquired. We may not be successful in attracting and retaining enough employees to achieve our desired expansion or staffing plans. Furthermore, the industry turnover rates for these types of employees are high and we may not be successful in retaining, training or motivating our employees. Any inability to attract, retain, train and motivate employees could impair our ability to adequately manage and complete existing projects and to accept new customer engagements. Such inability may also force us to increase our hiring of independent contractors, which may increase our costs and reduce our profitability on customer engagements. We must also devote substantial managerial and financial resources to monitoring and managing our workforce. Our future success will depend on our ability to manage the levels and related costs of our workforce.

In the event we are unable to attract, hire and retain the requisite personnel and subcontractors, we may experience delays in completing contracts in accordance with project schedules and budgets, which may have an adverse effect on our financial results, harm our reputation and cause us to curtail our pursuit of new contracts. Further, any increase in demand for personnel may result in higher costs, causing us to exceed the budget on a contract, which in turn may have an adverse effect on our business, financial condition and operating results and harm our relationships with our customers.

Any future acquisitions that we may make could disrupt our business, cause dilution to our stockholders and harm our business, financial condition or operating results.

If we are successful in consummating acquisitions, those acquisitions could subject us to a number of risks, including, but not limited to:

•        the purchase price we pay and/or unanticipated costs could significantly deplete our cash reserves or result in dilution to our existing stockholders;

•        we may find that the acquired company or technologies do not improve our market position as planned;

•        we may have difficulty integrating the operations and personnel of the acquired company, as the combined operations will place significant demands on the Company’s management, technical, financial and other resources;

•        key personnel and customers of the acquired company may terminate their relationships with the acquired company as a result of the acquisition;

•        we may experience additional financial and accounting challenges and complexities in areas such as tax planning and financial reporting;

•        we may assume or be held liable for risks and liabilities (including environmental-related costs) as a result of our acquisitions, some of which we may not be able to discover during our due diligence investigation or adequately adjust for in our acquisition arrangements;

•        our ongoing business and management’s attention may be disrupted or diverted by transition or integration issues and the complexity of managing geographically or culturally diverse enterprises;

•        we may incur one-time write-offs or restructuring charges in connection with the acquisition;

•        we may acquire goodwill and other intangible assets that are subject to amortization or impairment tests, which could result in future charges to earnings; and

•        we may not be able to realize the cost savings or other financial benefits we anticipated.

We cannot assure you that, following any acquisition, our continued business will achieve sales levels, profitability, efficiencies or synergies that justify the acquisition or that the acquisition will result in increased earnings for us in any future period. These factors could have a material adverse effect on our business, financial condition and operating results.

Any future disposition of assets and business could have material and adverse effect on business, financial conditions, and operations, if not consummated in a timely manner.

As part of our corporate strategy, our management considers and evaluates opportunities involving dispositions of assets and business. Such transactions may expose us to unknown or unforeseeable challenges resulting in disruption of business operations, loss of key personnel and ongoing tax benefits treatment, failure to obtain necessary statutory and regulatory approvals, provide ongoing indemnity, and compliance with post-closing obligations, which may affect or prevent us from consummating the transactions, and have a material and adverse effect on our business, financial conditions, and operations.

Insurance and contractual protections may not always cover lost revenue, increased expenses or liquidated damages payments, which could adversely affect our financial results.

Although we maintain insurance and intend to obtain warranties from suppliers, obligate subcontractors to meet certain performance levels and attempt, where feasible, to pass risks we cannot control to our customers, the proceeds of such insurance or the warranties, performance guarantees or risk sharing arrangements may not be adequate to cover lost revenue, increased expenses or liquidated damages payments that may be required in the future.

We have outstanding debt. Such indebtedness, along with the other contractual commitments of our Company, could adversely affect our business, financial condition and results of operations.

As of October 24, 2023, we have an outstanding principal and interest balance of approximately $10,380,000 underlying the promissory notes issued to a holder which mature on May 17, 2024 (the “Streeterville Notes”).

In addition, the noteholder may require us to redeem (i) 1/3 of the initial principal balance of the July 2022 Note and (ii) 1/6 of the initial principal balance of the December 2022 Note plus any interest accrued under the December 2022 Note each month in cash beginning on the date that is 6 months from the original issue date. The ability to meet payment and other obligations under these notes depends on our ability to generate significant cash flow in the future. This, to some extent, is subject to general economic, financial, competitive, legislative, regulatory and other factors beyond our control, including the risk factors described in this proxy statement/prospectus and our most recent Annual Report on Form 10-K. If we are not able to generate sufficient cash flow to service our debt

obligations, we may need to refinance or restructure debt, exchange debt for other securities, sell assets, reduce or delay capital investments, or seek to raise additional capital. If we are unable to implement one or more of these alternatives, we may not be able to meet debt payment and other obligations, which could have a material adverse effect on our financial condition.

In addition, so long as these notes are outstanding, the holders will have a right of first refusal on certain equity-linked financings and will be entitled to participate in certain equity or debt financings, in each case, subject to certain exceptions. The existence of these rights may deter potential financing sources and may lead to delays in our ability to close proposed financings. Any delay or inability to complete a financing when needed could have a material adverse effect on our financial condition.

We may also incur additional indebtedness in the future. If new debt or other liabilities are added to our current consolidated debt levels, the related risks that we now face could intensify.

If we were deemed to be an investment company under the Investment Company Act of 1940, as amended (the “1940 Act”), applicable restrictions could make it impractical for us to continue our business as contemplated and could have a material adverse effect on our business, financial condition and results of operations.

Under Sections 3(a)(1)(A) and (C) of the 1940 Act, a company generally will be deemed to be an “investment company” for purposes of the 1940 Act if (1) it is, or holds itself out as being, engaged primarily, or proposes to engage primarily, in the business of investing, reinvesting or trading in securities or (2) it engages, or proposes to engage, in the business of investing, reinvesting, owning, holding or trading in securities and it owns or proposes to acquire investment securities having a value exceeding 40% of the value of its total assets (exclusive of U.S. government securities and cash items) on an unconsolidated basis. In the past, we have made strategic investments in certain securities, including the purchase of certain interests in Cardinal Venture Holdings LLC, a Delaware limited liability company (“CVH”), which owns certain interests in the sponsor entity to KINS Technology Group Inc., a former special purpose acquisition company with which the Company entered into the Business Combination, as well as our holdings in Sysorex and Foxo Technologies Inc. Although we have made these strategic investments, we do not currently believe that we are an “investment company,” as such term is defined in either of those sections of the 1940 Act.

We intend to conduct our operations so that we will not be deemed an investment company. However, if we were to be deemed an investment company, restrictions imposed by the 1940 Act, including limitations on our capital structure and our ability to transact with affiliates, could make it impractical for us to continue our business as contemplated and could have a material adverse effect on our business, financial condition and results of operations.

We may be subject to damages resulting from claims that the Company or our employees have wrongfully used or disclosed alleged trade secrets of their former employers.

We may be subject to claims that our acquired companies and their employees may have inadvertently or otherwise used or disclosed trade secrets or other proprietary information of former employers or competitors. Litigation may be necessary to defend against these claims. We may be subject to unexpected claims of infringement of third party intellectual property rights, either for intellectual property rights of which we are not aware, or for which we believe are invalid or narrower in scope than the accusing party. Even if we are successful in defending against these claims, litigation could result in substantial costs and be a distraction to management. If we fail in defending such claims, in addition to paying money claims, we may lose valuable intellectual property rights or personnel or be enjoined from selling certain products or providing certain services. A loss of key research personnel or their work product could hamper or prevent our ability to commercialize certain products, which could severely harm our business.

We have been subject to regulatory and other government or regulatory investigations or inquiries under national, regional and local laws, as amended from time to time, and may be required to comply with data requests, or requests for information by government authorities and regulators in the United States or other jurisdictions in which we operate and any resulting enforcement action could have a materially adverse effect on us.

As a publicly trading reporting company with operations in the United States and internationally, we interact regularly with regulatory and self-regulatory agencies in the United States or other jurisdictions in which we operate, including the SEC and the Nasdaq Stock Market. We have been and may in the future be the subject of SEC and other regulatory investigations and may be required to comply with informal or formal orders or other requests for information or documentation from such government authorities and regulators regarding our compliance with

national, regional and local laws and regulations, including the rules and regulations under the Securities Act and the Exchange Act. Such laws and regulations and their interpretation and applications may also change from time to time. Responding to requests for information from regulators in connection with any such investigations or inquiries could have a materially adverse effect on our business through, among other things, significantly increased legal fees and the time and attention required of the Company’s management and employees to be diverted from our normal business operations and growth plans. Moreover, if a regulator were to initiate an enforcement action against us, such any action could further consume our resources, require us to change our business practices and have a material adverse effect on our business, financial condition, results of operations and cash flows.

Adverse judgments or settlements in legal proceedings could materially harm our business, financial condition, operating results and cash flows.

We may be a party to claims that arise from time to time in the ordinary course of our business, which may include those related to, for example, contracts, sub-contracts, protection of confidential information or trade secrets, adversary proceedings arising from customer bankruptcies, employment of our workforce and immigration requirements or compliance with any of a wide array of state and federal statutes, rules and regulations that pertain to different aspects of our business. Additionally, we may be made a party to future claims resulting from the Business Combination. We may also be required to initiate expensive litigation or other proceedings to protect our business interests. There is a risk that we will not be successful or otherwise be able to satisfactorily resolve any such claims or litigation. In addition, litigation and other legal claims are subject to inherent uncertainties. Those uncertainties include, but are not limited to, litigation costs and attorneys’ fees, unpredictable judicial or jury decisions and the differing laws and judicial proclivities regarding damage awards among the states in which we operate. Unexpected outcomes in such legal proceedings, or changes in management’s evaluation or predictions of the likely outcomes of such proceedings (possibly resulting in changes in established reserves), could have a material adverse effect on our business, financial condition, results of operations and cash flows. Due to recurring losses and net capital deficiency, our current financial status may increase our default and litigation risks and may make us more financially vulnerable in the face of threatened litigation.

The loss of our Chief Executive Officer or other key personnel may adversely affect our operations.

Our success depends to a significant extent upon the operation, experience, and continued services of certain of our officers, including our CEO, as well as other key personnel. While our CEO and key personnel are employed under employment contracts, there is no assurance we will be able to retain their services through the closing of the Business Combination. The loss of our CEO or several of the other key personnel could have an adverse effect on the Company. The changes to the senior management in connection with the merger, including the departure of our current CEO or other executive officers, and the transition to the new senior management team could result in us experiencing a loss in productivity while the successor obtains the necessary training and experience. To mitigate any adverse impact of such transition, our current CEO will continue to provide services based on his experience and knowledge on a consulting basis for one year pursuant to a consulting agreement. Furthermore, we do not maintain “key person” life insurance on the lives of any executive officer and their death or incapacity would have a material adverse effect on us. The competition for qualified personnel is intense, and the loss of services of certain key personnel could adversely affect our business.

Internal system or service failures could disrupt our business and impair our ability to effectively provide our services and products to our customers, which could damage our reputation and adversely affect our revenues and profitability.

Any system or service disruptions, on our hosted Cloud infrastructure or those caused by ongoing projects to improve our information technology systems and the delivery of services, if not anticipated and appropriately mitigated, could have a material adverse effect on our business including, among other things, an adverse effect on our ability to bill our customers for work performed on our contracts, collect the amounts that have been billed and produce accurate financial statements in a timely manner. We are also subject to systems failures, including network, software or hardware failures, whether caused by us, third-party service providers, invasions, disruptions, cyber security threats, hacker attacks, natural disasters, power shortages, terrorist attacks or other events, which could cause loss of data and interruptions or delays in our business, cause us to incur remediation costs, subject us to claims and damage our reputation. In addition, the failure or disruption of our communications or utilities could cause us financial or reputational damage, interrupt or suspend our operations, subject us to legal action and increased regulatory oversight, or otherwise adversely affect our business. Our property and business interruption insurance may be inadequate to compensate us for all losses that may occur as a result of any system or operational failure or disruption and, as a result, our future results could be adversely affected.

Systems failures could damage our reputation and adversely affect our revenues and profitability.

Many of the systems and networks that we develop, install and maintain for our customers on premise or host on our infrastructure involve managing and protecting confidential information and other sensitive corporate and government information. While we have programs designed to comply with relevant privacy and security laws and restrictions, if a system or network that we develop, install or maintain were to fail or experience a security breach or service interruption, whether caused by us, third-party service providers, shutdowns due to hardware failures, hacker attacks, cyber security threats or other events, we may experience loss of revenue, remediation costs or face claims for damages or contract termination. Any such event could cause serious harm to our reputation and prevent us from having access to or being eligible for further work on such systems and networks. Our errors and omissions liability insurance may be inadequate to compensate us for all of the damages that we may incur and, as a result, our future results could be adversely affected.

We may enter into joint venture, teaming and other arrangements, and these activities involve risks and uncertainties. A failure of any such relationship could have material adverse results on our business and results of operations.

We may enter into joint venture, teaming and other arrangements. These activities involve risks and uncertainties, including the risk of the joint venture or applicable entity failing to satisfy its obligations, which may result in certain liabilities to us for guarantees and other commitments, the challenges in achieving strategic objectives and expected benefits of the business arrangement, the risk of conflicts arising between us and our partners and the difficulty of managing and resolving such conflicts, and the difficulty of managing or otherwise monitoring such business arrangements. A failure of our business relationships could have a material adverse effect on our business and results of operations.

Our business and operations expose us to numerous legal and regulatory requirements and any violation of these requirements could harm our business.

We are subject to numerous federal, state and foreign legal requirements on matters as diverse as data privacy and protection, employment and labor relations, immigration, taxation, anti-corruption, import/export controls, trade restrictions, internal control and disclosure control obligations, securities regulation and anti-competition. Compliance with diverse and changing legal requirements is costly, time-consuming and requires significant resources. We are also focused on expanding our business in certain identified growth areas, such as health information technology, energy and environment, which are highly regulated and may expose us to increased compliance risk. Violations of one or more of these diverse legal requirements in the conduct of our business could result in significant fines and other damages, criminal sanctions against us or our officers, prohibitions on doing business and damage to our reputation. Violations of these regulations or contractual obligations related to regulatory compliance in connection with the performance of customer contracts could also result in liability for significant monetary damages, fines and/or criminal prosecution, unfavorable publicity and other reputational damage, restrictions on our ability to compete for certain work and allegations by our customers that we have not performed our contractual obligations.

If we do not adequately protect our intellectual property rights, we may experience a loss of revenue and our operations and growth prospects may be materially harmed.

We have not registered copyrights on any of the software we have developed, and while we may register copyrights in the software if needed before bringing suit for copyright infringement, such registration can introduce delays before suit of over three years and can constrain damages for infringement. We rely upon confidentiality agreements signed by our employees, consultants and third parties to protect our intellectual property. We cannot assure you that we can adequately protect our intellectual property or successfully prosecute actual or potential infringement of our intellectual property rights. In addition, we cannot assure you that others will not copy or reproduce aspects of our intellectual property and our products, or that others will not assert rights in, or ownership of, trademarks and other proprietary rights of ours or that we will be able to successfully resolve these types of conflicts to our satisfaction. Our failure to protect our intellectual property rights may result in a loss of revenue and could materially adversely affect our operations and financial condition.

In addition, any patents issued in the future may not provide us with any competitive advantages, and our patent applications may never be granted. The process of obtaining patent protection is expensive and time-consuming, and we may not be able to prosecute all necessary or desirable patent applications at a reasonable cost or in a timely manner. Even if issued, there can be no assurance that these patents will adequately protect our intellectual property, as the legal standards relating to the validity, enforceability and scope of protection of patent and other intellectual property rights are complex and often uncertain and are subject to change that can affect validity of patents issued under previous legal standards, particularly with respect to the law of subject matter eligibility. Our inability to protect our property rights could adversely affect our financial condition, operating results and growth prospects.

Our proprietary software is protected by common law copyright laws, as opposed to registration under copyright statutes. We have not registered copyrights on any of the proprietary software we have developed. Our performance and ability to compete are dependent to a significant degree on our proprietary technology. Common law protection may be narrower than that which we could obtain under registered copyrights. As a result, we may experience difficulty in enforcing our copyrights against certain third party infringements. As part of our confidentiality-protection procedures, we generally enter into agreements with our employees and consultants and limit access to, and distribution of, our software, documentation and other proprietary information. There can be no assurance that the steps we have taken will prevent misappropriation of our technology or that agreements entered into for that purpose will be enforceable. The laws of other countries may afford us little or no protection of our intellectual property. We also rely on a variety of technology that we license from third parties. There can be no assurance that these third party technology licenses will continue to be available to us on commercially reasonable terms, if at all. The loss of or inability to maintain or obtain upgrades to any of these technology licenses could result in delays in completing software enhancements and new development until equivalent technology could be identified, licensed or developed and integrated. Any such delays would materially and adversely affect our business.

The growth of our business is dependent on increasing sales to our existing customers and obtaining new customers, which, if unsuccessful, could limit our financial performance.

Our ability to increase revenues from existing customers by identifying additional opportunities to sell more of our products and services and our ability to obtain new customers depends on a number of factors, including our ability to offer high quality products and services at competitive prices, meeting customers’ needs and expectations, the strength of our competitors and the capabilities of our sales and marketing departments. If we are not able to continue to increase sales of our products and services to existing customers or to obtain new customers in the future, we may not be able to increase our revenues and could suffer a decrease in revenues as well.

Decreases, or slow growth, in the newspaper publishing industry may negatively affect our results from operation as it relates to our Shoom products.

The newspaper industry as a whole is experiencing challenges to maintain and grow print circulation and revenues. This results from, among other factors, increased competition from other media, particularly the growth of electronic media, and shifting preferences among some consumers to receive all or a portion of their news other than from a newspaper. The customer base for our Shoom products is focused on the newspaper publishing industry and therefore sales from this operating sector will be subject to the future of the newspaper industry.

Our competitiveness depends significantly on our ability to keep pace with the rapid changes in our industry. Failure by us to anticipate and meet our customers’ technological needs could adversely affect our competitiveness and growth prospects.

We operate and compete in an industry characterized by rapid technological innovation, changing customer needs, evolving industry standards and frequent introductions of new products, product enhancements, services and distribution methods. Our success depends on our ability to develop expertise with these new products, product enhancements, services and distribution methods and to implement solutions that anticipate and respond to rapid changes in technology, the industry, and customer needs. The introduction of new products, product enhancements and distribution methods could decrease demand for current products or render them obsolete. Sales of products and services can be dependent on demand for specific product categories, and any change in demand for or supply of such products could have a material adverse effect on our net sales if we fail to adapt to such changes in a timely manner.

Through our acquisitions, we have attempted to diversify our product offerings and increase our presence in new market verticals. There can be no assurances that consumer or commercial demand for our future products will meet, or even approach, our expectations. In addition, our pricing and marketing strategies may not be successful. Lack of customer demand, a change in marketing strategy and changes to our pricing models could dramatically alter our financial results. Unless we are able to release location based products that meet a significant market demand, we will not be able to improve our financial condition or the results of our future operations.

If we are unable to sell additional products and services to our customers and increase our overall customer base, our future revenue and operating results may suffer.

Our future success depends, in part, on our ability to expand the deployment of newly acquired technologies with existing customers and finding new customers to sell our products and services to. This may require increasingly sophisticated and costly sales efforts and may not result in additional sales. In addition, the rate at which our customers purchase additional products and services, and our ability to attract new customers, depends on a number of factors, including the perceived need for indoor mapping products and services, sustaining pricing of our product and services as well as general economic conditions. If our efforts to sell additional products and services are not successful, our business may suffer.

We operate in a highly competitive market and we may be required to reduce the prices for some of our products and services to remain competitive, which could adversely affect our results of operations.

Our industry is developing rapidly and related technology trends are constantly evolving. In this environment, we face, among other things, significant price competition from our competitors. As a result, we may be forced to reduce the prices of the products and services we sell in response to offerings made by our competitors and may not be able to maintain the level of bargaining power that we have enjoyed in the past when negotiating the prices of our products and services.

Our profitability is dependent on the prices we are able to charge for our products and services. The prices we are able to charge for our products and services are affected by a number of factors, including:

•        our customers’ perceptions of our ability to add value through our products and services;

•        introduction of new products or services by us or our competitors;

•        our competitors’ pricing policies;

•        our ability to charge higher prices where market demand or the value of our products or services justifies it;

•        procurement practices of our customers; and

•        general economic and political conditions.

If we are not able to maintain favorable pricing for our products and services, our results of operations could be adversely affected.

A delay in the completion of our customers’ budget processes could delay purchases of our products and services and have an adverse effect on our business, operating results and financial condition.

We rely on our customers to purchase products and services from us to maintain and increase our earnings, and customer purchases are frequently subject to budget constraints, multiple approvals and unplanned administrative, processing and other delays. If sales expected from a specific customer are not realized when anticipated or at all, our results could fall short of public expectations and our business, operating results and financial condition could be materially adversely affected.

Digital threats such as cyber-attacks, data protection breaches, computer viruses or malware may disrupt our operations, harm our operating results and damage our reputation, and cyber-attacks or data protection breaches on our customers’ networks, or in cloud-based services provided by or enabled by us, could result in liability for us, damage our reputation or otherwise harm our business.

Despite our implementation of network security measures, the products and services we sell to customers, and our servers, data centers and the cloud-based solutions on which our data, and data of our customers, suppliers and business partners are stored, are vulnerable to cyber-attacks, data protection breaches, computer viruses, malicious acts, and similar disruptions from unauthorized tampering or human error. Use of our products and services in our customers’ environments may have the possibility of being breached as a result of acts other than our customers exposing confidential and sensitive information. Despite our security controls and measures, any such event could compromise our networks or those of our customers, and the information stored on our networks or those of our

customers could be accessed, publicly disclosed, lost or stolen, which could subject us to liability to our customers, business partners and others, and could have a material adverse effect on our business, operating results, and financial condition and may cause damage to our reputation. Efforts to limit the ability of malicious third parties to disrupt the operations of the Internet or undermine our own security efforts may be costly to implement and meet with resistance, and may not be successful. Breaches of network security in our customers’ networks, or in cloud-based services provided by or enabled by us, regardless of whether the breach is attributable to a vulnerability in our products or services, could result in liability for us, damage our reputation or otherwise harm our business.

Any failures or interruptions in our services or systems could damage our reputation and substantially harm our business and results of operations.

Our success depends in part on our ability to provide reliable remote services, technology integration and managed services to our customers. The operations of our Cloud based applications and analytics are susceptible to damage or interruption from human error, fire, flood, power loss, telecommunications failure, terrorist attacks and similar events. We could also experience failures or interruptions of our systems and services, or other problems in connection with our operations, as a result of:

•        damage to or failure of our computer software or hardware or our connections;

•        errors in the processing of data by our systems;

•        computer viruses or software defects;

•        physical or electronic break-ins, sabotage, intentional acts of vandalism and similar events;

•        increased capacity demands or changes in systems requirements of our customers; and

•        errors by our employees or third-party service providers.

Any production interruptions for any reason, such as a natural disaster, epidemic, capacity shortages, or quality problems, at one of our manufacturing partners would negatively affect sales of product lines manufactured by that manufacturing partner and adversely affect our business and operating results.

Any interruptions in our systems or services could damage our reputation and substantially harm our business and results of operations. While we maintain disaster recovery plans and insurance with coverage we believe to be adequate, claims may exceed insurance coverage limits, may not be covered by insurance or insurance may not continue to be available on commercially reasonable terms.

Our Company may be subject to product liability due to manufacturing or design defects for which product liability insurance may not be sufficient.

We may be a party to product liability claims that arises from time to time in the ordinary course of our business, which may include those related to, for example, the development or marketing of the products, or adverse events known or reported to be associated with, or manufacturing defects in, the products sold by us or through third parties. Product liability claims may be time-consuming, cost-intensive, and may result in awarding of substantial damages to the plaintiff or demands for a product recall. Certain of our contract obligations with vendors, suppliers, or manufacturers require us to provide warranties against such claims. We cannot assure you that protections are sufficient against any product liability claim filed by or against us. In a few countries, strict liability is imposed even if an injury to the end user of a defective product was not caused by an act of the supplier, manufacturer, or seller. A successful claim or claims brought against us in an amount exceeding available insurance coverage or protections under our contractual relationships could subject us to significant liabilities and could have a material adverse effect on our business, financial condition, results of operations, and growth prospects.

We rely on a limited number of key customers, the importance of which may vary dramatically from year to year, and a loss of one or more of these key customers may adversely affect our operating results.

Our top three customers accounted for approximately 19% and 16% of our gross revenue during the years ended December 31, 2022 and 2021, respectively. No customer accounted for more than 10% of our gross revenue during the 2022 and 2021 years, with two customers accounting for 7% of our gross revenue in 2022 and one customer accounting for 8% in 2021; however, each of these customers may or may not continue to be a significant contributor

to revenue in 2023. The loss of a significant amount of business from one of our major customers would materially and adversely affect our results of operations until such time, if ever, as we are able to replace the lost business. Significant customers or projects in any one period may not continue to be significant customers or projects in other periods. To the extent that we are dependent on any single customer, we are subject to the risks faced by that customer to the extent that such risks impede the customer’s ability to stay in business and make timely payments to us.

We may need additional cash financing and any failure to obtain cash financing, could limit our ability to grow our business and develop or enhance our service offerings to respond to market demand or competitive challenges.

We expect that we will need to raise funds in order to continue our operations and implement our plans to grow our business. However, if we decide to seek additional capital, we may be unable to obtain financing on terms that are acceptable to us or at all. If we are unable to raise the required cash, our ability to grow our business and develop or enhance our service offerings to respond to market demand or competitive challenges could be limited.

If we cannot collect our receivables or if payment is delayed, our business may be adversely affected by our inability to generate cash flow, provide working capital or continue our business operations.

Our business depends on our ability to successfully obtain payment from our customers of the amounts they owe us for products received from us and any work performed by us. The timely collection of our receivables allows us to generate cash flow, provide working capital and continue our business operations. Our customers may fail to pay or delay the payment of invoices for a number of reasons, including financial difficulties resulting from macroeconomic conditions, lack of an approved budget, or participating in bankruptcy proceedings. An extended delay or default in payment relating to a significant account will have a material and adverse effect on the aging schedule and turnover days of our accounts receivable. If we are unable to timely collect our receivables from our customers for any reason, our business and financial condition could be adversely affected.

If our products fail to satisfy customer demands or to achieve increased market acceptance, our results of operations, financial condition and growth prospects could be materially adversely affected.

The market acceptance of our products are critical to our continued success. Demand for our products is affected by a number of factors beyond our control, including continued market acceptance, the timing of development and release of new products by competitors, technological change, and growth or decline in the mobile device management market. We expect the proliferation of mobile devices to lead to an increase in the data security demands of our customers, and our products may not be able to scale and perform to meet those demands. If we are unable to continue to meet customer demands or to achieve more widespread market acceptance of these products, our business operations, financial results and growth prospects will be materially and adversely affected.

Defects, errors, or vulnerabilities in our products or services or the failure of such products or services to prevent a security breach, could harm our reputation and adversely affect our results of operations.

Because our location based security products and services are complex, they have contained and may contain design or manufacturing defects or errors that are not detected until after their commercial release and deployment by customers. Defects may cause such products to be vulnerable to advanced persistent threats (“APTs”) or security attacks, cause them to fail to help secure information or temporarily interrupt customers’ networking traffic. Because the techniques used by hackers to access sensitive information change frequently and generally are not recognized until launched against a target, we may be unable to anticipate these techniques and provide a solution in time to protect customers’ data. In addition, defects or errors in our subscription updates or products could result in a failure to effectively update customers’ hardware products and thereby leave customers vulnerable to APTs or security attacks.

Any defects, errors or vulnerabilities in our products could result in:

•        expenditure of significant financial and product development resources in efforts to analyze, correct, eliminate, or work-around errors or defects or to address and eliminate vulnerabilities;

•        delayed or lost revenue;

•        loss of existing or potential customers or partners;

•        increased warranty claims compared with historical experience, or increased cost of servicing warranty claims, either of which would adversely affect gross margins; and

•        litigation, regulatory inquiries, or investigations that may be costly and harm our reputation

Our current research and development efforts may not produce successful products or features that result in significant revenue, cost savings or other benefits in the near future. If we do not realize significant revenue from our research and development efforts, our business and operating results could be adversely affected.

Developing products and related enhancements in our field is expensive. Investments in research and development may not result in significant design improvements, marketable products or features or may result in products that are more expensive than anticipated. We may not achieve the cost savings or the anticipated performance improvements expected, and we may take longer to generate revenue from products in development, or generate less revenue than expected.

Our future plans include significant investments in research and development and related product opportunities. Our management believes that we must continue to dedicate a significant amount of resources to research and development efforts to maintain a competitive position. However, we may not receive significant revenue from these investments in the near future, or these investments may not yield the expected benefits, either of which could adversely affect our business and operating results.

Misuse of our products could harm our reputation.

Our products, particularly our location based security and detection products, may be misused by customers or third parties that obtain access to such products. For example, location information combined with other information about the same users in the hands of criminals could result in misuse of the data and privacy law violations and result in negative press coverage and negatively affect our reputation.

If the general level of advanced attacks declines, or is perceived by current or potential customers to have declined, this could harm our location based security and detection operating segment, and our financial condition, operating results and growth prospects.

Our location based security and detection-operating segment is substantially dependent upon enterprises and governments recognizing that APTs and other security attacks are pervasive and are not effectively prevented by legacy security solutions. High visibility attacks on prominent enterprises and governments have increased market awareness of the problem of APTs and security attacks and help to provide an impetus for enterprises and governments to devote resources to protecting against attacks, such as testing our platform, purchasing it, and broadly deploying it within their organizations. If APTs and other security attacks were to decline, or enterprises or governments perceived that the general level of attacks has declined, our ability to attract new customers and expand its offerings for existing customers could be materially and adversely affected, which would, in turn, have a material adverse effect on our financial condition, results of operations and growth prospects.

If our location based security and detection products do not effectively interoperate with our customers’ IT infrastructure, installations could be delayed or cancelled, which would harm our financial condition, operating results and growth prospects.

Our products must effectively interoperate with our customers’ existing or future IT infrastructure, which often has different specifications, utilizes multiple protocol standards, deploys products from multiple vendors, and contains multiple generations of products that have been added over time. As a result, when problems occur in a company’s infrastructure, it may be difficult to identify the sources of these problems. If we find errors in the existing software or defects in the hardware used in our customers’ infrastructure, we may have to modify its software or hardware so that our products will interoperate with the infrastructure of our customers. In such cases, our products may be unable to provide significant performance improvements for applications deployed in the infrastructure of our customers. These issues could cause longer installation times for our products and could cause order cancellations, either of which would adversely affect our business, results of operations and financial condition. In addition, other customers may require products to comply with certain security or other certifications and standards. If our products are late in achieving or fail to achieve compliance with these certifications and standards, or competitors sooner achieve compliance with these certifications and standards, we may be disqualified from selling our products to such customers, or may otherwise be at a competitive disadvantage, either of which would harm our business, results of operations, and financial condition.

Our international business exposes us to geo-political and economic factors, legal and regulatory requirements, public health and other risks associated with doing business in foreign countries.

We provide our products and services to customers worldwide. These risks differ from and potentially may be greater than those associated with our domestic business.

Our international business is sensitive to changes in the priorities and budgets of international customers and geo-political uncertainties, which may be driven by changes in threat environments and potentially volatile worldwide economic conditions, various regional and local economic and political factors, risks and uncertainties, as well as U.S. foreign policy.

Our international sales are also subject to local government laws, regulations and procurement policies and practices, which may differ from U.S. Government regulations, including regulations relating to import-export control, investments, foreign exchange controls and repatriation of earnings, as well as to varying currency, geo-political and economic risks. Our international contracts may include industrial cooperation agreements requiring specific in-country purchases, manufacturing agreements or financial support obligations, known as offset obligations, and provide for penalties if we fail to meet such requirements. Our international contracts may also be subject to termination at the customer’s convenience or for default based on performance, and may be subject to funding risks. We also are exposed to risks associated with using foreign representatives and consultants for international sales and operations and teaming with international subcontractors, partners and suppliers in connection with international programs. As a result of these factors, we could experience award and funding delays on international programs and could incur losses on such programs, which could negatively affect our results of operations and financial condition.

We are also subject to a number of other risks including:

•        the absence in some jurisdictions of effective laws to protect our intellectual property rights;

•        multiple and possibly overlapping and conflicting tax laws;

•        restrictions on movement of cash;

•        the burdens of complying with a variety of national and local laws;

•        political instability;

•        currency fluctuations;

•        longer payment cycles;

•        restrictions on the import and export of certain technologies;

•        price controls or restrictions on exchange of foreign currencies; and

•        trade barriers.

In addition, our international operations (or those of our business partners) could be subject to natural disasters such as earthquakes, tsunamis, flooding, typhoons and volcanic eruptions that disrupt manufacturing or other operations. There may be conflict or uncertainty in the countries in which we operate, including public health issues (for example, an outbreak of a contagious disease such as 2019-Novel Coronavirus (2019-nCoV), avian influenza, measles or Ebola), safety issues, natural disasters, fire, disruptions of service from utilities, nuclear power plant accidents or general economic or political factors. For example, as a result of the Coronavirus outbreak, our ability to source internal connection cables for certain of our sensors has been delayed, which will require us to source these components from other vendors at a higher price that may result in an increase in our costs to produce our products In the event our customers are materially impacted by these events, it may impact anticipated orders and planned shipments for our products. With respect to political factors, the United Kingdom’s 2016 referendum, commonly referred to as “Brexit,” has created economic and political uncertainty in the European Union. Also, the European Union’s General Data Protection Regulation imposes significant new requirements on how we collect, process and transfer personal data, as well as significant fines for non-compliance. Any of the above risks, should they occur, could result in an increase in the cost of components, production delays, general business interruptions, delays from difficulties in obtaining export licenses for certain technology, tariffs and other barriers and restrictions, longer payment cycles, increased taxes, restrictions on the repatriation of funds and the burdens of complying with a variety of foreign laws, any of which could ultimately have a material adverse effect on our business.

Our international operations are subject to special U.S. government laws and regulations, such as the Foreign Corrupt Practices Act, and regulations and procurement policies and practices, including regulations to import-export control, which may expose us to liability or impair our ability to compete in international markets.

Our international operations are subject to the U.S. Foreign Corrupt Practices Act (“FCPA”), and other laws that prohibit improper payments or offers of payments to foreign governments and their officials and political parties by U.S. and other business entities for the purpose of obtaining or retaining business. We have operations and deal with governmental customers in countries known to experience corruption, including certain countries in the Middle East and in the future, the Far East. Our activities in these countries create the risk of unauthorized payments or offers of payments by one of our employees, consultants or contractors that could be in violation of various laws including the FCPA, even though these parties are not always subject to our control. We are also subject to import-export control regulations restricting the use and dissemination of information classified for national security purposes and the export of certain products, services, and technical data, including requirements regarding any applicable licensing of our employees involved in such work.

Difficult conditions in the global capital markets and the economy generally may materially adversely affect our business and results of operations, and we do not expect these conditions to improve in the near future.

Our results of operations are materially affected by conditions in the global capital markets and the economy generally, both in the U.S. and elsewhere around the world. Weak economic conditions generally, sustained uncertainty about global economic conditions, or a prolonged or further tightening of credit markets could cause our customers and potential customers to postpone or reduce spending on technology products or services or put downward pressure on prices, which could have an adverse effect on our business, results of operations or cash flows. Concerns over inflation, energy costs, geopolitical issues and the availability of credit, in the U.S. have contributed to increased volatility and diminished expectations for the economy and the markets going forward. These factors, combined with volatile oil prices and wavering business and consumer confidence, have precipitated an economic slowdown and uncertain global outlook. Domestic and international equity markets have been experiencing heightened volatility and turmoil. These events and the continuing market upheavals may have an adverse effect on our business. In the event of extreme prolonged market events, such as the global economic recovery, we could incur significant losses.

Changes in U.S. administrative policy, including changes to existing trade agreements and any resulting changes in international relations, could adversely affect our financial performance and supply chain economics.

As a result of changes to U.S. administrative policy, among other possible changes, there may be (i) changes to existing trade agreements; (ii) greater restrictions on free trade generally; and (iii) significant increases in tariffs on goods imported into the United States, particularly those manufactured in China. China is currently a leading global source of hardware products, including the hardware products that we use. In January 2020, the U.S. and China entered into Phase One of the Economic and Trade Agreement Between the United States of America and the People’s Republic of China (the “Phase One Trade Agreement”). The Phase One Trade Agreement takes steps to ease certain trade tensions between the U.S. and China, including tensions involving intellectual property theft and forced intellectual property transfers by China. Although the Phase One Trade Agreement is an encouraging sign of progress in the trade negotiations between the U.S. and China, questions still remain as to the enforcement of its terms, the resolution of a number of other points of dispute between the parties, and the prevention of further tensions. If the U.S.-China trade dispute re-escalates or relations between the United States and China deteriorate, these conditions could adversely affect our ability to source our hardware products and therefore our ability to manufacture our products. Our ability to manufacture our products could also be affected by economic uncertainty, in China or by our failure to establish a positive reputation and relationships in China. The occurrence of any of these events could have an adverse effect on our ability to source the components necessary to manufacture our products, which, in turn, could cause our long-term business, financial condition and operating results to be materially adversely affected.

There is also a possibility of future tariffs, trade protection measures, import or export regulations or other restrictions imposed on our products or on our customers by the United States, China or other countries that could have a material adverse effect on our business. A significant trade disruption or the establishment or increase of any tariffs, trade protection measures or restrictions could result in lost sales adversely impacting our reputation and business. A trade war, other governmental action related to tariffs or international trade agreements, changes in U.S. social, political,

regulatory and economic conditions or in laws and policies governing foreign trade, manufacturing, development and investment in the territories and countries where we currently do business or any resulting negative sentiments towards the United States could adversely affect our supply chain economics, consolidated revenue, earnings and cash flow.

We intend to use and leverage open source technology which may create risks of security weaknesses.

Some parts of our technology may be based on open-source technology, including, but not limited to the technology that we may use in our Indoor Intelligence products. There is a risk that the development team or other third parties may intentionally or unintentionally introduce weaknesses or bugs into the core infrastructure elements of our technology solutions interfering with the use of such technology or causing loss to the Company.

We may not be able to develop new products or enhance our product to keep pace with our industry’s rapidly changing technology and customer requirements.

The industry in which we operate is characterized by rapid technological changes, new product introductions, enhancements, and evolving industry standards. Our business prospects depend on our ability to develop new products and applications for our technology in new markets that develop as a result of technological and scientific advances, while improving performance and cost-effectiveness. New technologies, techniques or products could emerge that might offer better combinations of price and performance than the blockchain technology solutions that are being developed by the Company. It is important that we anticipate changes in technology and market demand. If we do not successfully innovate and introduce new technology into our anticipated technology solutions or effectively manage the transitions of our technology to new product offerings, our business, financial condition and results of operations could be harmed.

Domestic and foreign government regulation and enforcement of data practices and data tracking technologies is expansive, broadly defined and rapidly evolving. Such regulation could directly restrict portions of our business or indirectly affect our business by constraining our customers’ use of our technology and services or limiting the growth of our markets.

Federal, state, municipal and/or foreign governments and agencies have adopted and could in the future adopt, modify, apply or enforce laws, policies, and regulations covering user privacy, data security, technologies that are used to collect, store and/or process data, and/or the collection, use, processing, transfer, storage and/or disclosure of data associated with individuals. The categories of data regulated under these laws vary widely, are often broadly defined, and subject to new applications or interpretation by regulators. The uncertainty and inconsistency among these laws, coupled with a lack of guidance as to how these laws will be applied to current and emerging indoor positioning analytics technologies, creates a risk that regulators, lawmakers or other third parties, such as potential plaintiffs, may assert claims, pursue investigations or audits, or engage in civil or criminal enforcement. These actions could limit the market for our services and technologies or impose burdensome requirements on our services and/or customers’ use of our services, thereby rendering our business unprofitable.

Some features of our services may trigger the data protection requirements of certain foreign jurisdictions, such as the EU General Data Protection Regulation (the “GDPR”), and the EU ePrivacy Directive. In addition, our services may be subject to regulation under current or future laws or regulations. For instance, the EU ePrivacy Directive is soon to be replaced in its entirety by the ePrivacy Regulation, which will bring with it an updated set of rules relevant to many aspects of our business. If our treatment of data, privacy practices or data security measures fail to comply with these current or future laws and regulations in any of the jurisdictions in which we collect and/or process information, we may be subject to litigation, regulatory investigations, civil or criminal enforcement, financial penalties, audits or other liabilities in such jurisdictions, or our customers may terminate their relationships with us. In addition, data protection laws, such as the GDPR, foreign court judgments or regulatory actions could affect our ability to transfer, process and/or receive transnational data that is critical to our operations, including data relating to users, customers, or partners outside the United States. For instance, the GDPR restricts transfers of personal data outside of the European Economic Area, including to the United States, subject to certain requirements. Such data protection laws, judgments or actions could affect the manner in which we provide our services or adversely affect our financial results if foreign customers and partners are not able to lawfully transfer data to us.

This area of the law is currently under intense government scrutiny and many governments, including the U.S. government, are considering a variety of proposed regulations that would restrict or impact the conditions under which data obtained from individuals could be collected, processed, stored, transferred, sold or shared with third parties. In

addition, regulators such as the Federal Trade Commission and the California Attorney General are continually proposing new regulations and interpreting and applying existing regulations in new ways. For example, in June 2018, California passed the California Consumer Privacy Act (the “CCPA”), which provides new data privacy rights for consumers and new informational, disclosure and operational requirements for companies, effective January 2020. Fines for non-compliance may be up to $7,500 per violation. The burdens imposed by the GDPR and CCPA, and changes to existing laws or new laws regulating the solicitation, collection, processing, or sharing of personal and consumer information, and consumer protection could affect our customers’ utilization of our services and technology and could potentially reduce demand, or impose restrictions that make it more difficult or expensive for us to provide our services.

In addition, ongoing legal challenges in Europe to the mechanisms allowing companies to transfer personal data from the European Economic Area to the United States could result in further limitations on the ability to transfer data across borders, particularly if governments are unable or unwilling to reach new or maintain existing agreements that support cross-border data transfers, such as the EU-U.S. and Swiss-U.S. Privacy Shield frameworks and the European Commission’s Model Contractual Clauses, each of which are currently under particular scrutiny. Additionally, certain countries have passed or are considering passing laws requiring local data residency. The costs of compliance with, and other burdens imposed by, privacy laws, regulations and standards may limit the use and adoption of our services, reduce overall demand for our services, make it more difficult to meet expectations from or commitments to customers, lead to significant fines, penalties or liabilities for noncompliance, impact our reputation, or slow the pace at which we close sales transactions, any of which could harm our business.

Furthermore, the uncertain and shifting regulatory environment and trust climate may cause concerns regarding data privacy and may cause our customers or our customers’ customers to resist providing the data necessary to allow our customers to use our services effectively. Even the perception that the privacy of personal information is not satisfactorily protected or does not meet regulatory requirements could inhibit sales of our products or services and could limit adoption of our cloud-based solutions.

If our customers fail to abide by applicable privacy laws or to provide adequate notice and/or obtain any required consent from end users, we could be subject to litigation or enforcement action or reduced demand for our services.

Our customers utilize our services and technologies to track connected devices anonymously and we must rely on our customers to implement and administer notice and choice mechanisms required under applicable laws. If we or our customers fail to abide by these laws, it could result in litigation or regulatory or enforcement action against our customers or against us directly.

Any actual or perceived failure by us to comply with our privacy policy or legal or regulatory requirements in one or multiple jurisdictions could result in proceedings, actions or penalties against us.

Any failure or perceived failure by us to comply with federal, state or foreign laws or regulations, industry standards, contractual obligations or other legal obligations, or any actual or suspected security incident, whether or not resulting in unauthorized access to, or acquisition, release or transfer of personal data or other data, may result in governmental enforcement actions and prosecutions, private litigation, fines and penalties or adverse publicity and could cause our customers to lose trust in us, which could have an adverse effect on our reputation and business. Any inability to adequately address privacy and security concerns, even if unfounded, or comply with applicable laws, regulations, policies, industry standards, contractual obligations or other legal obligations could result in additional cost and liability to us, damage our reputation, inhibit sales and adversely affect our business.

Evolving and changing definitions of what constitutes “Personal Information” and “Personal Data” within the EU, the United States and elsewhere, may limit or inhibit our ability to operate or expand our business, including limiting technology alliance partners that may involve the sharing of data.

If we are perceived to cause, or are otherwise unfavorably associated with, violations of privacy or data security requirements, it may subject us or our customers to public criticism, financial penalties and potential legal liability. Existing and potential privacy laws and regulations concerning privacy and data security and increasing sensitivity of consumers to unauthorized processing of personal data may create negative public reactions to technologies, products and services such as ours. Public concerns regarding personal data processing, privacy and security may cause some of our customers’ end users to be less likely to visit their venues or otherwise interact with them. If enough end users choose not to visit our customers’ venues or otherwise interact with them, our customers could stop using our platform. This, in turn, may reduce the value of our service, and slow or eliminate the growth of our business, or cause our business to contract.

Around the world, there are numerous lawsuits in process against various technology companies that process personal information and personal data. If those lawsuits are successful, it could increase the likelihood that our company may be exposed to liability for our own policies and practices concerning the processing of personal data and could hurt our business. Furthermore, the costs of compliance with, and other burdens imposed by laws, regulations and policies concerning privacy and data security that are applicable to the businesses of our customers may limit the use and adoption of our technologies and reduce overall demand for it. Privacy concerns, whether or not valid, may inhibit market adoption of our technologies. Additionally, concerns about security or privacy may result in the adoption of new legislation that restricts the implementation of technologies like ours or require us to make modifications to our existing services and technology, which could significantly limit the adoption and deployment of our technologies or result in significant expense.

Changes in the value of the common stock or other securities that we own as a result of strategic investments may result in material fluctuations (increases or decreases) in our total asset value and net income on a quarterly basis.

On September 15, 2022, we acquired 891,124 shares of Class A common stock, par value $0.0001 (“FOXO common stock”) of Foxo Technologies Inc. (“FOXO”) in connection with the conversion of a 10% convertible note acquired on April 27, 2022 in an aggregate principal amount of $6,050,000 for a purchase price of $5,500,000 as a result of the closing of a business combination. On June 20, 2023 (the “Release Effective Date”), the Company entered into a general release agreement with FOXO, pursuant to which the Company received 0.67 shares of FOXO Class A Common Stock for every $1.00 of subscription amount of the 10% convertible note purchased on April 27, 2022 in exchange for an agreement by the Company to release, waive and forever discharge FOXO from any causes of action, losses, costs and expenses from the beginning of time through the Release Effective Date. The Company received 3,685,000 shares of FOXO Class A Common Stock in exchange for such release. The Company recognized a realized gain on receipt of FOXO securities of approximately $1,100,000 based on the fair value of the FOXO securities for the six months ended June 30, 2023, included in Other income/(expense), net, on the accompanying unaudited condensed consolidated statement of operations included elsewhere in this proxy statement/prospectus.

FOXO common stock is traded in active markets, as the security is trading under “FOXO” on the NYSE American. FOXO common stock is accounted for as available-for-sale equity securities based on “Level 1” inputs, which consist of quoted prices in active markets, with unrealized holding gains and losses included in earnings. The fair value of the FOXO common stock was determined by the closing trading price of the security as of June 30, 2023. The Company recognized an unrealized gain on FOXO common stock of $0.06 million for the six months ended June 30, 2023.

Consequently, the investment securities we own, are inherently volatile. Accordingly, the value of our total assets and as a consequence, the price of our common stock may decline or increase regardless of our operating performance, which may result in losses for investors purchasing shares of our common stock. Further, to the extent that we experience unrealized losses in connection with such securities from declines in securities values that management determines to be other than temporary, the book value of those securities will be adjusted to their estimated recovery value and we will recognize a charge to earnings in the quarter during which we make that determination. Additionally, the Company has no control over the price the Company will eventually receive as a result of the disposition of such assets and may be unable to sell the aforementioned securities at favorable prices quickly or when desired.

Risks Related to Ownership of Inpixon’s Securities

Our common stock may be delisted from the Nasdaq Capital Market which could negatively impact the price of our common stock, liquidity and our ability to access the capital markets.

Our common stock currently trades on the Nasdaq Capital Market (“Nasdaq”) under the symbol “INPX.” The listing standards of Nasdaq provide that a company, in order to qualify for continued listing, must maintain a minimum stock price of $1.00 and satisfy standards relative to minimum stockholder’s equity, minimum market value of publicly held shares and various additional requirements. If Nasdaq delists our securities from trading on its exchange for failure to meet the listing standards, we and our stockholders could face significant negative consequences including:

•        limited availability of market quotations for our securities;

•        a determination that the common stock is a “penny stock” which would require brokers trading in the common stock to adhere to more stringent rules, possibly resulting in a reduced level of trading activity in the secondary trading market for shares of common stock;

•        a limited amount of analyst coverage, if any; and

•        a decreased ability to issue additional securities or obtain additional financing in the future.

Delisting from Nasdaq could also result in other negative consequences, including the potential loss of confidence by suppliers, customers and employees, the loss of institutional investors’ interest and fewer business development opportunities.

In several instances in the past, including as recently as on April 14, 2023, we received written notification from Nasdaq informing us that because the closing bid price of our common stock was below $1.00 for 30 consecutive trading days, our shares no longer complied with the minimum closing bid price requirement for continued listing on Nasdaq under the Nasdaq Listing Rules. Each time, we were given a period of 180 days from the date of the notification to regain compliance with Nasdaq’s listing requirements by having the closing bid price of our common stock listed on Nasdaq be at least $1.00 for at least 10 consecutive trading days.

In connection with the April 14, 2023 notice, in accordance with Nasdaq Listing Rule 5810(c)(3)(A), we have been provided a period of 180 calendar days, or until October 11, 2023, in which to regain compliance. In order to regain compliance with the minimum bid price requirement, the closing bid price of our common stock must be at least $1.00 per share for a minimum of ten consecutive business days during this 180-day period. In the event that we do not regain compliance within this 180-day period, we may be eligible to seek an additional compliance period of 180 calendar days if we meet the continued listing requirement for market value of publicly held shares and all other initial listing standards for the Nasdaq Capital Market, with the exception of the bid price requirement, and provide written notice to Nasdaq of our intent to cure the deficiency during this second compliance period, by effecting a reverse stock split, if necessary. However, if it appears to the Nasdaq staff that the Company will not be able to cure the deficiency, or if the Company is otherwise not eligible, Nasdaq will provide notice to the Company that our common stock will be subject to delisting. The April 14, 2023 notice does not result in the immediate delisting of our common stock from the Nasdaq Capital Market. We plan to request an extension of the initial 180-day period to regain compliance in accordance with Nasdaq Listing Rule 5810(c)(3)(A)(ii).

We intend to monitor the closing bid price of our common stock and consider our available options in the event that the closing bid price of our common stock remains below $1 per share. While we have regained compliance within the applicable time periods in the past, we cannot be certain that we will be able to regain compliance in connection with the April 14, 2023 notice, or that we will be able to comply with the other continued listing requirements. The Inpixon Reverse Stock Split was approved by the shareholders of Inpixon at Inpixon’s special meeting of shareholders held on September 29, 2023. The Inpixon Reverse Stock Split, when implemented, is expected to satisfy Nasdaq’s initial listing requirements for the combined company’s stock and its minimum bid price requirement.

If during the compliance period the our common stock has a closing bid price of $0.10 or less for ten consecutive trading days, the Nasdaq Listing Qualifications Department may issue a Staff Delisting Determination under Nasdaq Listing Rule 5810. As of November 6th, 2023, our closing bid price has been trading at $0.10 or less for nine consecutive trading days. In the event we receive such a delisting determination, Nasdaq rules will permit us to appeal a delisting determination to a Nasdaq Hearings Panel. If such as letter is received, we intend to appeal such determination. The Inpixon Reverse Stock Split, when implemented, is expected to satisfy Nasdaq’s minimum bid price requirement.

If our shares of common stock lose their status on Nasdaq, we believe that they would likely be eligible to be quoted on the inter-dealer electronic quotation and trading system operated by OTC Markets Group Inc., commonly referred to as the Pink Open Market and we may also qualify to be traded on the OTCQB market (The Venture Market). These markets are generally not considered to be as efficient as, and not as broad as, Nasdaq. Selling our shares on these markets could be more difficult because smaller quantities of shares would likely be bought and sold, and transactions could be delayed. In addition, in the event our shares are delisted, broker-dealers have certain regulatory burdens imposed upon them, which may discourage broker-dealers from effecting transactions in our common stock or even holding our common stock, further limiting the liquidity of our common stock. These factors could result in lower prices and larger spreads in the bid and ask prices for our common stock.

Our stock price may be volatile.

The market price of our common stock is likely to be highly volatile and could fluctuate widely in price in response to various factors, many of which are beyond our control, including the following:

•        our ability to execute our business plan and complete prospective acquisitions;

•        changes in our industry;

•        competitive pricing pressures;

•        our ability to obtain working capital financing;

•        additions or departures of key personnel;

•        limited “public float” in the hands of a small number of persons whose sales or lack of sales could result in positive or negative pricing pressure on the market price for our common stock;

•        sales of our common stock;

•        operating results that fall below expectations;

•        changes in our capital structure;

•        costs associated with our acquisitions of companies, assets and technologies;

•        regulatory developments;

•        economic and other external factors;

•        period-to-period fluctuations in our financial results;

•        our inability to develop or acquire new or needed technologies or news relating to such technologies;

•        the public’s response to press releases or other public announcements by us or third parties, including filings with the SEC;

•        changes in financial estimates or ratings by any securities analysts who follow our common stock, our failure to meet these estimates or failure of those analysts to initiate or maintain coverage of our common stock;

•        the development and sustainability of an active trading market for our common stock; and

•        any future sales of our common stock by our officers, directors and significant stockholders.

In addition, the securities markets have from time to time experienced significant price and volume fluctuations that are unrelated to the operating performance of particular companies. These market fluctuations may also materially and adversely affect the market price of our common stock.

Your investment may suffer a decline in value as a result of the volatility of our stock.

The closing market price for our common stock has varied between a high of $2.39 on October 25, 2022, and a low of $0.10 on October 20, 2023, in the twelve-month period ended October 24, 2023. During this time, the price per share of common stock has ranged from an intra-day low of $0.09 per share to an intra-day high of $2.49 per share. As a result of fluctuations in the price of our common stock, you may be unable to sell your shares at or above the price you paid for them. The market price of our common stock is likely to continue to be volatile and subject to significant price and volume fluctuations in response to market, industry and other factors, including the other risk factors described in this section. The market price of our common stock may also be dependent upon the valuations and recommendations of the analysts who cover our business. If the results of our business do not meet these analysts’ forecasts, the expectations of investors or the financial guidance we provide to investors in any period, the market price of our common stock could decline.

In addition, the stock markets in general, and the markets for technology stocks in particular, have experienced significant volatility that has often been unrelated to the financial condition or results of operations of particular companies. These broad market fluctuations may adversely affect the trading price of our common stock and, consequently, adversely affect the price at which you could sell the shares that you purchase in this offering. In the past, following periods of volatility in the market or significant price declines, securities class-action litigation has often been instituted against companies. Such litigation, if instituted against us, could result in substantial costs and diversion of management’s attention and resources, which could materially and adversely affect our business, financial condition, results of operations and growth prospects.

Offers or availability for sale of a substantial number of shares of our common stock may cause the price of our common stock to decline.

If our stockholders sell substantial amounts of our common stock in the public market upon the expiration of any statutory holding period under Rule 144, or shares issued upon the exercise of outstanding options or warrants, it could create a circumstance commonly referred to as an “overhang” and, in anticipation of which, the market price of our common stock could fall. The existence of an overhang, whether or not sales have occurred or are occurring, also could make more difficult our ability to raise additional financing through the sale of equity or equity-related securities in the future at a time and price that we deem reasonable or appropriate.

In general, a non-affiliated person who has held restricted shares for a period of six months, under Rule 144, may sell into the market our common stock all of their shares, subject to the Company being current in its periodic reports filed with the SEC. As of the date of this filing, a significant portion of our outstanding shares of common stock outstanding are free trading.

Sales of our common stock or other securities, or the perception that future sales may occur, may cause the market price of our common stock to decline, even if our business is doing well.

Sales of our common stock or other securities, or the perception that future sales may occur, may cause the market price of our common stock to decline, even if our business is doing well. Sales of substantial amounts of our common stock in the public market, or the perception that these sales could occur, could adversely affect the price of our common stock and could impair our ability to raise capital through the sale of additional shares. For example, in June 2021, the SEC declared effective a shelf registration statement filed by us. This shelf registration statement allows us to issue any combination of our common stock, preferred stock, warrants, units, debt securities and subscription rights from time to time until expiry in June 2024 for an aggregate initial offering price of up to $350 million, subject to certain limitations.

During the nine months ended September 30, 2023, the Company sold 70,375,554 shares of common stock at share prices between $0.139609 and $1.86 per share under the Sales Agreement for gross proceeds of approximately $27.4 million or net proceeds of $26.5 million after deducting the placement agency fees and other offering expenses. As of October 24, 2023, we had an aggregate remaining amount of approximately [$59] million available for the issuance of securities in offerings under the shelf registration statement. However, our ability to raise capital under the shelf registration statement may be limited by, among other things, SEC rules and regulations impacting the eligibility of smaller companies to use Form S-3 for primary offerings of securities. Based on our public float, as of the date hereof, we are only permitted to utilize the shelf registration statement subject to Instruction I.B.6. to Form S-3, which is referred to as the “baby shelf” rule. For so long as our public float is less than $75.0 million, we may not sell more than the equivalent of one-third of our public float during any 12 consecutive months pursuant to the baby shelf rules. These rules may limit future issuances of shares by us in connection with the ATM Offering Program or other offerings pursuant to the Company’s effective shelf registration statement on Form S-3. Although alternative public and private transaction structures may be available, these may require additional time and cost, may impose operational restrictions on us, and may not be available on attractive terms. The specific terms of future offerings, if any, under the shelf registration statement would be established at the time of such offering. Depending on a variety of factors, including market liquidity of our common stock, the sale of shares under the shelf registration statement may cause the trading price of our common stock to decline. The sale of a substantial number of shares of our common stock under the shelf registration statement, or anticipation of such sales, could cause the trading price of our common stock to decline or make it more difficult for us to sell equity or equity-related securities in the future at a time and at a price that we might otherwise desire.

As of October 24, 2023, we had 127,688,550 shares of common stock outstanding. In addition, as of October 24, 2023, there were 1 share issuable upon conversion of 1 share of Series 4 Convertible Preferred Stock, 12 shares of Common Stock issuable upon conversion of 126 shares of Series 5 Convertible Preferred Stock, 144,846,260 shares subject to outstanding warrants, 286,764 shares subject to outstanding options under the Company’s equity incentive plans, 1 share subject to an option not under such plans and up to an additional 55,384,490 shares of common stock which may be issued under the Company’s 2018 Employee Stock Incentive Plan that will become, or have already become, eligible for sale in the public market to the extent permitted by any applicable vesting requirements, lock-up agreements, if any, Rule 144 under the Securities Act or in connection with their registration under the Securities Act. The issuance or sale of such shares could depress the market price of our common stock. In the future, we also may issue our securities if we need to raise additional capital. The number of new shares of our common stock issued in connection with raising additional capital could constitute a material portion of the then-outstanding shares of our common stock.

Historically, we have used our shares of common stock to satisfy our outstanding debt obligations, and, in the future, we expect to continue to issue our securities to raise additional capital or satisfy outstanding debt obligations. The number of new shares of our common stock issued in connection with raising additional capital or satisfying our outstanding debt obligations could constitute a material portion of the then-outstanding shares of our common stock.

There may be future sales or other dilution of our equity, which may adversely affect the market price of our common stock.

Our articles of incorporation allows us to issue up to 500,000,000 shares of our common stock, par value $0.001 per share, and to issue and designate the rights of, without stockholder approval, up to 5,000,000 shares of preferred stock, par value $0.001 per share. To raise additional capital, we may in the future sell additional shares of our common stock or other securities convertible into or exchangeable for our common stock at prices that are lower than the prices paid by existing stockholders, and investors purchasing shares or other securities in the future could have rights superior to existing stockholders, which could result in substantial dilution to the interests of existing stockholders. The market price of our common stock could decline as a result of sales of common stock or securities that are convertible into or exchangeable for, or that represent the right to receive common stock or the perception that such sales could occur.

Furthermore, the Merger Agreement permits additional sales of stock by Inpixon and XTI between signing and closing. As the Exchange Ratio will be adjusted in accordance with its terms for any securities issuances by Inpixon and XTI between signing and closing, and because Inpixon intends to issue additional shares and raise additional capital between signing and closing pursuant to the terms of the Merger Agreement, this means that Inpixon’s stockholders will also experience dilution as a result of such issuances.

In addition, to the extent that outstanding stock options or warrants have been or may be exercised or preferred stock converted or other shares issued, you may experience further dilution.

We may issue debt and equity securities or securities convertible into equity securities, any of which may be senior to our Common Stock as to distributions and in liquidation, which could negatively affect the value of our Common Stock.

In the future, we may attempt to increase our capital resources by entering into debt or debt-like financing that is unsecured or secured by up to all of our assets, or by issuing additional debt or equity securities, which could include issuances of secured or unsecured commercial paper, medium-term notes, senior notes, subordinated notes, guarantees, preferred stock, hybrid securities, or securities convertible into or exchangeable for equity securities. In the event of our liquidation, our lenders and holders of our debt and preferred securities would receive distributions of our available assets before distributions to the holders of our Common Stock. Because our decision to incur debt and issue securities in future offerings may be influenced by market conditions and other factors beyond our control, we cannot predict or estimate the amount, timing or nature of our future offerings or debt financings. Further, market conditions could require us to accept less favorable terms for the issuance of our securities in the future.

If our Common Stock is delisted, market liquidity for our Common Stock could be severely affected and our stockholders’ ability to sell their shares of our Common Stock could be limited. A delisting of our Common Stock from Nasdaq would negatively affect the value of our Common Stock. A delisting of our Common Stock could also adversely affect our ability to obtain financing for our operations and could result in the loss of confidence in our company.

If our Common Stock becomes subject to the penny stock rules, it would become more difficult to trade our shares.

The SEC has adopted rules that regulate broker-dealer practices in connection with transactions in penny stocks. Penny stocks are generally equity securities with a price of less than $5.00, other than securities registered on certain national securities exchanges or authorized for quotation on certain automated quotation systems, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or system. If we do not retain a listing on The Nasdaq Capital Market, and if the price of our Common Stock is less than $5.00, our Common Stock will be deemed a penny stock. The penny stock rules require a broker-dealer, before a transaction in a penny stock not otherwise exempt from those rules, to deliver a standardized risk disclosure document containing specified information. In addition, the penny stock rules require that before effecting any transaction in a penny stock not otherwise exempt from those rules, a broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive (i) the purchaser’s written acknowledgment of the receipt of a risk

disclosure statement; (ii) a written agreement to transactions involving penny stocks; and (iii) a signed and dated copy of a written suitability statement. These disclosure requirements may have the effect of reducing the trading activity in the secondary market for our Common Stock, and therefore stockholders may have difficulty selling their shares.

We do not intend to pay cash dividends to our stockholders, so it is unlikely that stockholders will receive any return on their investment in our Company prior to selling our stock.

We have never paid any dividends to our common stockholders as a public company. We currently intend to retain any future earnings for funding growth and, therefore, do not expect to pay any cash dividends in the foreseeable future. If we determine that we will pay cash dividends to the holders of our common stock, we cannot assure that such cash dividends will be paid on a timely basis. The success of your investment in our Company will likely depend entirely upon any future appreciation. As a result, you will not receive any return on your investment prior to selling your shares in our Company and, for the other reasons discussed in this “Risk Factors” section, you may not receive any return on your investment even when you sell your shares in our Company.

Some provisions of our Articles of Incorporation and bylaws may deter takeover attempts, which may inhibit a takeover that stockholders consider favorable and limit the opportunity of our stockholders to sell their shares at a favorable price.

Under our Articles of Incorporation, our Board may issue additional shares of common or preferred stock. Our Board has the ability to authorize “blank check” preferred stock without future shareholder approval. This makes it possible for our Board to issue preferred stock with voting or other rights or preferences that could impede the success of any attempt to acquire us by means of a merger, tender offer, proxy contest or otherwise, including a transaction in which our stockholders would receive a premium over the market price for their shares and/or any other transaction that might otherwise be deemed to be in their best interests, and thereby protects the continuity of our management and limits an investor’s opportunity to profit by their investment in the Company. Specifically, if in the due exercise of its fiduciary obligations, the Board were to determine that a takeover proposal was not in our best interest, shares could be issued by our Board without stockholder approval in one or more transactions that might prevent or render more difficult or costly the completion of the takeover by:

•        diluting the voting or other rights of the proposed acquirer or insurgent stockholder group,

•        putting a substantial voting bloc in institutional or other hands that might undertake to support the incumbent Board, or

•        effecting an acquisition that might complicate or preclude the takeover.

Nevada Anti-Takeover Law may discourage acquirers and eliminate a potentially beneficial sale for our stockholders.

We are subject to the provisions of Sections 78.411 to 78.444, inclusive, of the Nevada Revised Statutes, known as the “business combination” statute. This statute prevents many Nevada corporations from engaging in a business combination with any interested stockholder, under specified circumstances. For these purposes, a business combination includes a merger or sale of more than 5% of our assets, and an interested stockholder includes a stockholder who owns 10% or more of our outstanding voting stock, as well as affiliates and associates of these persons that, within two years prior to the combination, beneficially owned such percentage of the voting power. Under these provisions, this type of business combination is prohibited for up to four years following the date that the stockholder became an interested stockholder unless the transaction in which the stockholder became an interested stockholder is approved by the Board prior to the date the interested stockholder attained that status. Where the person becoming an interested stockholder was not approved in advance by the board of directors, the Nevada business combination statute imposes a basic moratorium of two years on business combinations unless they are approved by the board of directors and stockholders owning at least 60% of the outstanding voting power not beneficially owned by the interested stockholder and its affiliates and associates. After the two-year period, but before four years, combinations remain prohibited but may also be permitted if the interested stockholder satisfies certain requirements with respect to the aggregate consideration to be received by holders of outstanding shares in the combination.

We are also subject to the “acquisition of controlling interest” provisions of Sections 78.378 through 78.3793, inclusive, of the Nevada Revised Statutes, also known as the “control share” statute, which apply to “issuing corporations” that are Nevada corporations doing business, directly or through an affiliate, in Nevada, and having

at least 200 stockholders of record, including at least 100 of whom have addresses in Nevada appearing on the stock ledger of the corporation. Under that statute, any person who acquires a controlling interest in a corporation may not exercise voting rights of any control shares unless such voting rights are conferred by a majority vote of the disinterested stockholders of the issuing corporation at a special meeting of such stockholders held upon the request and at the expense of the acquiring person. The statute applies to acquisition of a “controlling interest” in ownership of outstanding voting shares of an issuing corporation sufficient to enable the acquiring person, individually or in association with others, directly or indirectly, to exercise (i) one fifth or more but less than one third, (ii) one third or more but less than a majority or (iii) a majority or more of the voting power of the issuing corporation in the election of directors, and voting rights must be conferred by a majority of the disinterested stockholders as each threshold is reached and/or exceeded. In the event that the control shares are accorded full voting rights and the acquiring person acquires control shares with a majority or more of all the voting power, any stockholder, other than the acquiring person, who does not vote in favor of authorizing voting rights for the control shares is entitled to demand payment for the fair value of such person’s shares, and the corporation must comply with the demand. The Nevada control share statute does not apply to any acquisition of a controlling interest in an issuing corporation if the articles of incorporation or bylaws of the corporation in effect on the 10th day following the acquisition of a controlling interest by the acquiring person provide that the provisions of those sections do not apply to the corporation or to an acquisition of a controlling interest specifically by types of existing or future stockholders, whether or not identified. Therefore, the board of directors of a Nevada corporation usually may unilaterally avoid the imposition of burdens imposed by the control share statute by amending the bylaws of the corporation in connection with a transaction. A Nevada corporation may impose stricter requirements if it so desires.

These statutes could prohibit or delay mergers or other takeover or change in control attempts and, accordingly, may discourage attempts to acquire us.

The limitation of liability, or our indemnification, of our officers and directors may cause us to use corporate resources in a manner that conflicts with the interests of our stockholders.

Nevada law eliminates the personal liability of our directors and officers for damages as a result of an act or failure to act in that capacity unless a statutory presumption that such person acted in good faith, on an informed basis and with a view to the interests of the corporation has been rebutted. In addition, it must be proven both that the act or failure to act constituted a breach of a fiduciary duty as a director or officer and that such breach involved intentional misconduct, fraud or a knowing violation of law. This limitation may not affect the availability of equitable remedies, such as injunctive relief or rescission. Our Articles of Incorporation require us to indemnify our directors and officers to the fullest extent permitted by Nevada law, including in circumstances in which indemnification is otherwise discretionary under Nevada law.

Nevada law generally permits indemnification of our directors, officers and others if the person either (i) acted in good faith and in a manner which he or she reasonably believed to be in or not opposed to Inpixon’s best interests, and, if the action is not by or in the right of the corporation and is with respect to any criminal proceeding, the person had no reasonable cause to believe that their conduct was unlawful, or (ii) is not liable under the Nevada statutory provision eliminating the liability of certain persons as described in the preceding paragraph.

These persons may be indemnified against expenses, including attorneys’ fees, judgments, fines, penalties, including excise taxes, and amounts paid in settlement and costs, actually and reasonably incurred by the person in connection with the proceeding. If the person is adjudged by a court to be liable to the corporation, no indemnification will be made unless that or another court determines that the person is fairly and reasonably entitled to indemnity for such expenses as the court deems proper.

Insofar as indemnification for liabilities under the Securities Act may be permitted to directors, officers or persons controlling us under the above provisions, we have been informed that, in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable.

The obligations associated with being a public company require significant resources and management attention, which may divert from our business operations.

We are subject to the reporting requirements of the Exchange Act and the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”). The Exchange Act requires that we file annual, quarterly and current reports, proxy statements, and other information. The Sarbanes-Oxley Act requires, among other things, that we establish and maintain effective

internal controls and procedures for financial reporting. Our principal executive officer and principal financial officer are required to certify that our disclosure controls and procedures are effective in ensuring that material information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. As a result, we incur significant legal, accounting and other expenses. Furthermore, the need to establish the corporate infrastructure demanded of a public company may divert management’s attention from implementing our growth strategy, which could prevent us from improving our business, results of operations and financial condition. We have made, and will continue to make, if necessary, changes to our internal controls and procedures for financial reporting and accounting systems to meet our reporting obligations as a public company. However, the measures we take may not be sufficient to satisfy our obligations as a public company. In addition, we cannot predict or estimate the amount of additional costs we may incur in order to comply with these requirements. We anticipate that these costs could materially increase our selling, general and administrative expenses.

Section 404 of the Sarbanes-Oxley Act requires annual management assessments of the effectiveness of our internal control over financial reporting. In connection with the implementation of the necessary procedures and practices related to internal control over financial reporting, we may identify deficiencies. Additionally, in the event we are no longer a smaller reporting company, as defined under the Exchange Act, and we are unable to comply with the internal controls requirements of the Sarbanes-Oxley Act of 2002, then we may not be able to obtain the independent registered public accountants’ certifications required by that act, which may preclude us from keeping our filings with the SEC current, and interfere with the ability of investors to trade our securities and our shares to continue to be listed on the Nasdaq Capital Market.

If we fail to establish and maintain an effective system of internal controls, we may not be able to report our financial results accurately or prevent fraud. Any inability to report and file our financial results accurately and timely could harm our reputation and adversely affect the trading price of our common stock.

Effective internal controls are necessary for us to provide reliable financial reports and prevent fraud. If we cannot provide reliable financial reports or prevent fraud, we may not be able to manage our business as effectively as we would if an effective control environment existed, and our business and reputation with investors may be harmed. With each prospective acquisition we may make we will conduct whatever due diligence is necessary or prudent to assure us that the acquisition target can comply with the internal controls requirements of the Sarbanes-Oxley Act. Notwithstanding our diligence, certain internal controls deficiencies may not be detected. As a result, any internal control deficiencies may adversely affect our financial condition, results of operations and access to capital. We have not performed an in-depth analysis to determine if historical undiscovered failures of internal controls exist, and may in the future discover areas of our internal controls that need improvement.

If we are unable to maintain effective internal controls, we may not have adequate, accurate or timely financial information, and we may be unable to meet our reporting obligations as a public company, including the requirements of the Sarbanes-Oxley Act, we may be unable to accurately report our financial results in future periods, or report them within the timeframes required by the requirements of the SEC, Nasdaq or the Sarbanes-Oxley Act. Failure to comply with the Sarbanes-Oxley Act, when and as applicable, could also potentially subject us to sanctions or investigations by the SEC or other regulatory authorities. Any failure to maintain or implement required new or improved controls, or any difficulties we encounter in their implementation, could result in identification of additional material weaknesses or significant deficiencies, cause us to fail to meet our reporting obligations or result in material misstatements in our financial statements. Furthermore, if we cannot provide reliable financial reports or prevent fraud, our business and results of operations could be harmed and investors could lose confidence in our reported financial information.

Public company compliance may make it more difficult to attract and retain officers and directors.

The Sarbanes-Oxley Act and rules implemented by the SEC have required changes in corporate governance practices of public companies. As a public company, these rules and regulations increase our compliance costs and make certain activities more time consuming and costly. As a public company, these rules and regulations may make it more difficult and expensive for us to maintain our director and officer liability insurance and we may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. As a result, it may be more difficult for us to attract and retain qualified persons to serve on our Board or as executive officers, and to maintain insurance at reasonable rates, or at all.

If securities or industry analysts do not publish research or reports about our business, or if they change their recommendations regarding our stock adversely, our stock price and trading volume could decline.

The trading market for our common stock relies in part on the research and reports that equity research analysts publish about us and our business. We do not control these analysts. The price of our common stock could decline if one or more equity research analysts downgrade our common stock or if they issue other unfavorable commentary or cease publishing reports about us or our business.

We may be or may become the target of securities litigation, which is costly and time-consuming to defend.

Following periods of market volatility in the price of a company’s securities or the reporting of unfavorable news, security holders may institute class action litigation. If the market value of our securities experience adverse fluctuations and we become involved in this type of litigation, regardless of the outcome, we could incur substantial legal costs and our management’s attention could be diverted from the operation of our business, causing our business to suffer.

Risks Related to XTI

In addition to the other information contained in this proxy statement/prospectus, including the matters addressed under the heading “Forward-Looking Statements,” you should carefully consider the following risk factors in deciding how to vote on the proposals presented in this proxy statement/prospectus. The risk factors described below disclose both material and other risks and are not intended to be exhaustive and are not the only risks facing us. Additional risks not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition, results of operations and cash flows in future periods or are not identified because they are generally common to businesses.

Unless the context otherwise requires, all references in this subsection to the “Company,” “we,” “us” or “our” refer to the business of XTI prior to the consummation of the merger, which will be the business of the combined company and its consolidated subsidiaries following the consummation of the merger. The occurrence of one or more of the events or circumstances described in these risk factors, alone or in combination with other events or circumstances, may have a material adverse effect on the business, financial condition, results of operations, cash flows and future prospects of the combined company, in which event the market price of the combined company common stock could decline, and you could lose part or all of your investment.

Risks Related to XTI’s Business and Industry

We have a limited operating history and have not yet manufactured any non-prototype aircraft or delivered any aircraft to customers, and we may never develop or manufacture any VTOL aircraft.

We have a limited operating history in the VTOL aircraft industry. XTI’s primary VTOL aircraft product is the TriFan 600 (the “aircraft”, “Aircraft” or the “TriFan 600”), which is currently in the developmental stage. If we are successful in commercially producing the Aircraft, we do not expect to be able to obtain approval from the Federal Aviation Administration (FAA) and regulatory bodies in other countries, and commence deliveries until 2028 at the earliest, if at all. We have no experience as an organization in high volume manufacturing of the Aircraft or any other type of aircraft. We cannot assure you that we or our partners will be able to develop efficient, automated, cost-efficient manufacturing capabilities and processes and reliable sources of component supplies that will enable us to meet the quality, price, engineering, design and production standards, as well as the production volumes, required to successfully mass market our aircraft. You should consider our business and prospects in light of the risks and significant challenges we face as a new entrant into our industry, including, among other things, with respect to our ability to:

•        design and produce safe, reliable and quality aircraft on an ongoing basis;

•        obtain the necessary regulatory approvals in a timely manner;

•        build a well-recognized and respected brand;

•        establish and expand our customer base;

•        successfully service our aircraft after sales and maintain a good flow of spare parts and customer goodwill;

•        improve and maintain our operational efficiency;

•        predict our future revenues and appropriately budget for our expenses;

•        attract, retain and motivate talented employees;

•        anticipate trends that may emerge and affect our business;

•        anticipate and adapt to changing market conditions, including technological developments and changes in our competitive landscape; and

•        navigate an evolving and complex regulatory environment.

If we fail to adequately address any or all of these risks and challenges, our business, financial condition and results of operations may be materially and adversely affected.

We are an early-stage Company and have not yet generated any revenues.

We were formed in 2009 and have a limited operating history. There is no assurance that the combined company will ever be profitable or generate sufficient revenue to pay dividends to the holders of the shares. We do not believe we will be able to generate revenues without successfully securing FAA certification of the TriFan 600 aircraft, which involves substantial risk. As a result, we are dependent upon raising sufficient financing to fund the Company until the TriFan 600’s entry-into-service. At the time of this filing and based on the Company’s conclusion of its Preliminary Design Review (“PDR”) in 2022, we estimate this amount to be a minimum of $500 million in capital, net of anticipated aircraft deposits. If planned operating levels are changed, higher operating costs encountered, lower sales revenue received, more time is needed to implement the plan, or less funding is received from customer deposits or sales, more investor funds than currently anticipated may be required. Additional difficulties may be encountered prior to FAA certification, such as unanticipated problems relating to development, testing, and initial and continuing regulatory compliance, vendor manufacturing costs, production and assembly, and the competitive and regulatory environments in which we intend to operate. If additional capital is not available when required, or is not available on acceptable terms, we may be forced to modify or abandon our business plan.

We have realized significant operating losses to date and expect to incur losses in the future.

We have operated at a loss since inception, and we anticipate that our expenses will increase and that we will continue to incur losses in the future until at least the time we begin manufacturing our aircraft. Even if we are able to successfully develop and sell our aircraft, there can be no assurance that the aircraft will be commercially successful and achieve or sustain profitability. Until the Company achieves profitability, it will have to seek other sources of capital in order to continue operations.

We expect the rate at which we will incur losses to be significantly higher in future periods as we, among other things, certify and assemble our aircraft, deploy our facilities, build up inventories of parts and components for our aircraft, increase our sales and marketing activities, develop our manufacturing infrastructure and increase our general and administrative functions to support our growing operations. These efforts may not result in the Company reaching profitability, which would further increase our losses.

There is a possibility that we may not be able to continue as a “going concern.”

We have adopted ASU No. 2014-15, “Disclosure of Uncertainties about the Entity’s Ability to Continue as a Going Concern.” We have concluded that there is an uncertainty about our ability to continue as a going concern and our independent auditors have incorporated this into their opinion of our 2022 audited financial statements, accordingly. This opinion could materially limit our ability to raise additional funds by issuing new debt or equity securities or otherwise. If we fail to raise sufficient capital when needed, we will not be able to complete our proposed business plan. As a result, we may have to liquidate our business and investors may lose their investments. Our ability to continue as a going concern is dependent on our ability to successfully accomplish our plan of operations described herein, obtain financing and eventually attain profitable operations.

Operating aircraft carries a degree of inherent risk. Accidents or incidents involving VTOL aircraft, us or our competitors could have a material adverse effect on our business, financial condition and results of operations.

Test flying prototype aircraft is inherently risky, and accidents or incidents involving our aircraft are possible. Any such occurrence would negatively impact our development, testing and certification efforts, and could result in re-design, certification delay and/or postponements or delays to the sales of our aircraft.

The operation of aircraft is subject to various risks, and we expect demand for our aircraft to be impacted by accidents or other safety issues regardless of whether such accidents or issues involve our aircraft. Such accidents or incidents could also have a material impact on our ability to obtain certification from the FAA and/or international regulators for our aircraft, or to obtain such certification in a timely manner. Such events could impact confidence in a particular aircraft type or the air transportation services industry as a whole, particularly if such accidents or disasters were due to a safety fault. We believe that regulators and the general public are still forming opinions about the safety and utility of various new types of VTOL aircraft, particularly “air taxis”, which are also known as “eVTOLs.” An accident or incident involving either our VTOL aircraft or an eVTOL aircraft during these early stages of opinion formation could have a disproportionate impact on the longer-term view of the advanced VTOL aircraft market generally.

There may be heightened public skepticism of new types of VTOL aircraft and its adopters. In particular, there could be negative public perception surrounding air taxis, including the overall safety and the potential for injuries or death occurring as a result of accidents involving them, regardless of whether any such safety incidents involve our aircraft. Any of the foregoing risks and challenges could adversely affect the combined company’s prospects, business, financial condition and results of operations.

We are at risk of adverse publicity stemming from any public incident involving our company, our people, our brand or other companies in our industry. Such an incident could involve the actual or alleged behavior of any of our employees or third-party contractors. Further, if our personnel, our aircraft or other types of aircraft are involved in a public incident, accident, catastrophe or regulatory enforcement action, we could be exposed to significant reputational harm and potential legal liability. The insurance we carry may be inapplicable or inadequate to cover any such incident, accident, catastrophe or action. In the event that our insurance is inapplicable or inadequate, we may be forced to bear substantial losses from an incident or accident. In addition, any such incident, accident, catastrophe or action involving our employees, our aircraft or other types of aircraft could create an adverse public perception, which could harm our reputation, result in passengers being reluctant to use our services and adversely impact our business, results of operations and financial condition.

The remainder of the development period for the TriFan 600 may take longer than anticipated.

Even if it meets its development schedule, we do not expect to deliver certified aircraft to customers until 2028 at the earliest. As a result, the receipt of significant revenues is not anticipated until that time and may occur later than projected, as our previous development schedule has been delayed. We depend on receiving large amounts of capital and other financing to complete our development work, with no assurance that we will be successful in completing our development work or becoming profitable.

We will face significant market competition.

The TriFan 600 potentially competes with a variety of aircraft manufacturers in the United States and abroad. Further, we could face competition from competitors of whom we are not aware that have developed or are developing technologies that will offer alternatives to the TriFan 600. Competitors could develop an aircraft that renders the TriFan 600 less competitive than we believe it will become. Many existing potential competitors are well-established, have or may have longer-standing relationships with customers and potential business partners, have or may have greater name recognition, and have or may have access to significantly greater financial, technical and marketing resources. Other manufacturers may be developing a light, fixed-wing, VTOL aircraft with performance similar to that of the TriFan 600.

The market for a civilian long-range fixed-wing VTOL aircraft is new and untested. If such market does not respond at the level we expect or if it fails to grow as large as we expect, our business, financial condition and results of operations could be harmed.

The market for a civilian long-range fixed-wing VTOL aircraft is completely new and untested. Our success in this market is dependent upon our ability to effectively market and sell travel and other applications by the TriFan 600 as a substitute for conventional methods of air transportation (i.e., helicopters and/or light and mid-size business aircraft) and the effectiveness of our other marketing and growth efforts. If the public does not respond as expected as a result of concerns regarding safety, affordability or for other reasons, then the market for our offerings may not develop, may develop more slowly than we expect or may not achieve the growth potential we expect, any of which could harm our business, financial condition and results of operations.

Developing new products and technologies entails significant risks and uncertainties.

Delays or cost overruns in the development or certification of the TriFan 600 and failure of the product to meet its performance estimates is likely to affect our financial performance. Delays and increased costs may be caused by unanticipated technological hurdles, changes to design or failure on the part of our suppliers to deliver components as agreed. This may further delay the development and/or certification of the TriFan 600.

Additionally, the TriFan 600 may not perform at the level we expect or may contain defects in design and manufacture that may cause them not to perform as expected or that may require repair. It is not possible to fully replicate every operating condition and validate the long-term durability of every aspect of our aircraft in testing prior to its use in service. In some instances, we may need to continue to rely upon projections and models to validate the projected performance of our aircraft over their lifetime. Therefore, similar to most aerospace products, there is a risk that our aircraft may suffer unforeseen faults, defect or other issues in service. Such faults, defects and other issues may require significant additional research and development to rectify and could involve suspension of operation of our aircraft until any such defects can be cured. There can be no assurance that such research and development efforts would result in viable products or cure any such defects. Obtaining the necessary data and results may take longer than planned or may not be obtained at all. Any such delays or setbacks could have a material adverse effect on our reputation and our ability to achieve our projected timelines and financial goals.

We may be unable to manage our future growth effectively, which could make it difficult to execute our business strategy.

If our operations continue to grow as planned, of which there can be no assurance, we will need to expand our sales, marketing, operations, and the number of partners with whom we do business. Our continued growth could increase the strain on our resources, and we could experience operating difficulties, including difficulties in hiring, training and managing an increasing number of employees. These difficulties may divert the attention of management and key employees and impact financial and operational results. The continued expansion of our business may also require additional space for administrative support. If we are unable to drive commensurate growth, these costs, which include lease commitments, marketing costs and headcount, could result in decreased margins, which could have an adverse effect on our business, financial condition and results of operations.

Our aircraft may require maintenance at frequencies or at costs that are greater than expected.

The TriFan 600, when produced, is anticipated to require regular maintenance and support. We are still developing our understanding of the long-term maintenance profile of the aircraft, and if useful lifetimes are shorter than expected, this may lead to greater maintenance costs than previously anticipated. If the TriFan 600 and related equipment require maintenance more frequently than we plan for or at costs that exceed our estimates, that would have an impact on the sales of our aircraft and have a material adverse effect on our business, financial condition and results of operations.

There may be a shortage of pilots and mechanics who meet the training standards required, which could reduce our ability to sell our aircraft at scale and on our expected timelines.

There is a shortage of pilots that is expected to exacerbate over time as more pilots in the industry approach mandatory retirement age. Similarly, trained and qualified aircraft and aviation mechanics are also in short supply. If these shortages continue, the aviation industry as a whole and our business may face challenges.

The pre-orders we have received for our aircraft are non-binding, conditional or written expressions of interest and may be terminated at any time prior to execution of a definitive purchase agreement. If these pre-orders are cancelled, modified, delayed or not placed in accordance with the terms agreed with each party, our business, results of operations, liquidity and cash flow will be materially adversely affected.

We have a pre-sales program which includes refundable deposits for TriFan 600 aircraft. Most pre-orders do not include deposits. The deposits we have received do not create an obligation on the part of the customer to purchase an aircraft, and a customer may request the full return of its refundable deposit. Most pre-orders are subject to the execution of a definitive purchase agreement between us and each party that contains the final terms for the purchase of our aircraft, including, but not limited to, the final number of aircraft to be purchased and the timing for delivery of the aircraft. Some or most customers might not transition to non-refundable purchase contracts until prior to aircraft delivery, if at all. Aircraft customers might respond to weak economic conditions or competitive alternatives in the market by canceling orders, resulting in lower demand for our aircraft and other materials, such as parts, services, and training, from which we expect to generate additional revenue. Such events would have a material adverse effect on our financial results and/or liquidity. For more detailed information regarding our material pre-orders, see “XTI’s Business — Key Agreement.”

Operations could be adversely affected by interruptions of production that are beyond our control.

We intend to produce the TriFan 600 and its derivatives using systems, components and parts developed and manufactured by third-party suppliers. This supply chain exposes us to multiple potential sources of delivery failure or component shortages for our aircraft, most of which are out of our control, including shortages of, or disruptions in the supply of, the raw materials used by our partners in the manufacture of components, disruptions to our partners’ workforce (such as strikes or labor shortfalls) and disruptions to, or capacity constraints affecting, shipping and logistics. Such suppliers may be subject to additional risks such as financial problems that limit their ability to conduct their operations. If any of these third parties experience difficulties, it may have a direct negative impact on us.

While we believe that we may be able to establish alternate supply relationships and can obtain replacement components, we may be unable to do so in the short term or at all at prices that are acceptable to us or may need to recertify components. We may experience source disruptions in our or our partners’ supply chains, which may cause delays in our overall production process for both prototype and commercial production aircraft.

If we needed to find alternative suppliers for any of the key components of our aircraft, then this could increase our costs and adversely affect our ability to receive such components on a timely basis, or at all, which could cause significant delays in our overall projected timelines for the delivery of our aircraft and adversely affect our relationships with our customers.

In addition, if we experience a significant increase in demand, or need to replace our existing suppliers, there can be no assurance that additional suppliers of component parts will be available when required on terms that are acceptable to us, or at all, or that any supplier would allocate sufficient supplies to us in order to meet our requirements or fill our orders in a timely manner. Further, if we are unable to manage successfully our relationships with all of our suppliers and partners, the quality and availability of our aircraft may be harmed. Our suppliers or partners could, under some circumstances, decline to accept new purchase orders from, or otherwise reduce their business with, us. Any disruptions in the supply of components from our suppliers and partners could lead to delays in aircraft production, which would materially adversely affect our business, financial condition and operating results.

Further, if any conflicts arise between our suppliers or partners and us, the other party may act in a manner adverse to us and could limit our ability to implement our business strategies, which could impact our projected production timelines and number of aircraft produced. Our suppliers or partners may also develop, either alone or with others, products in related fields that are competitive with our products as a result of any conflicts or disagreements. Any disagreements or conflicts with our suppliers or partners could have an adverse effect on our reputation, which could also negatively impact our ability to source new suppliers or partners.

Any changes in business conditions, wars, governmental changes, political intervention and other factors beyond our control or which we do not presently anticipate, could also affect our partners’ and suppliers’ abilities to deliver components to us on a timely basis, which could have a material adverse effect on our overall timelines to produce our aircraft. We do not control our suppliers or partners or such parties’ labor and other legal compliance practices, including their environmental, health and safety practices. If our current suppliers or partners, or any other suppliers or partners which we may use in the future, violates any specific laws or regulations, we may be subjected to extra

duties, significant monetary penalties, adverse publicity, the seizure and forfeiture of products that we are attempting to import or the loss of our import privileges. The effects of these factors could render the conduct of our business in a particular country undesirable or impractical and have a negative impact on our business, financial condition and results of operations.

We will require FAA certification, and a delay in receiving such certification could adversely affect our prospects, business, financial condition and results of operations.

The TriFan 600 is still in the development stage, and XTI is still working to obtain FAA type certification of the TriFan 600. Certification by the FAA will be required for the sale of the TriFan 600 in the civil or commercial market in the United States. The process to obtain such certification is expensive and time consuming and has inherent engineering risks. These include (but are not limited to) ground test risks such as structural strength and fatigue resistance, and structural flutter modes. Flight test risks include (but are not limited to) stability and handling over the desired center-of-gravity range, performance extremes (stalls, balked-landing climb, single-engine climb), and flutter control effectiveness (aircraft roll effectiveness, controllability, various control failure safety). Delays in FAA certification can be expected to result in us incurring increased costs in attempting to correct any issues causing such delays. Also, the impact of new or changed laws or regulations on the TriFan 600’s certification or the costs of complying with such laws and regulations cannot be predicted.

Our business may be adversely affected by the current macroeconomic challenges, including the effects of inflation, rising interest rates or an economic downturn or recession.

Current macroeconomic conditions, including inflation, rising interest rates and any economic downturn or recession in certain regions or worldwide have, and may continue to, adversely affect our business, financial condition and results of operations. The existence of inflation in certain economies has resulted in, and may continue to result in, rising interest rates and capital costs, supply shortages, increased costs of labor, components, manufacturing and shipping, as well as weakening exchange rates and other similar effects. As a result, we have experienced and may continue to experience cost increases. Although we take measures to mitigate the effects of inflation and rising interest rates, if these measures are not effective, our business, financial condition, results of operations and liquidity could be materially adversely affected. Even if such measures are effective, there could be a difference between the timing of when those beneficial actions impact our results or operations and when the cost of inflation is incurred.

We depend on key personnel.

Our future success depends on the efforts of key personnel, including its senior executive team. We do not currently carry any key man life insurance on our key personnel or senior executive team. The loss of services of any of these personnel may have an adverse effect on us. There can be no assurance that we will be successful in attracting and retaining the personnel we require to develop and market the proposed TriFan 600 aircraft and conduct our proposed operations.

Our estimates of market demand may be inaccurate.

We have projected the market for the TriFan 600 based upon a variety of internal and external market data. The estimates involve assumptions, which may not be realized in fact. There can be no assurance that our estimates for the number of TriFan 600 aircraft that may be sold in the market will be as anticipated. In the event that we have not accurately estimated the market size for and the number of TriFan 600 aircraft that we can sell, it could have a material adverse effect upon us and our results from operations.

We will require intellectual property protection and may be subject to the intellectual property claims of others.

Although we have received patents issued by the US Patent and Trademark Office (USPTO) (design patent D741247 and utility patent US 9,676,479) and various foreign patents for the TriFan 600, there is no guarantee that we will receive one or more additional patents for which we will apply to the USPTO or for which we have applied or will apply in foreign jurisdictions. If one or more of any of our existing or future patents are challenged by a third party (such as a claim of invalidity of our patents or a claim of infringement against us), the federal courts would determine whether we are entitled to patent protection. If we fail to successfully enforce our proprietary technology or otherwise maintain the proprietary nature of our intellectual property used in the TriFan 600 aircraft, our competitive position could suffer. Notwithstanding our efforts to protect our intellectual property, our competitors may independently

develop similar or alternative technologies or products that are equal to or superior to our TriFan 600 technology without infringing on any of our intellectual property rights or design around our proprietary technologies. There is no guarantee that the USPTO will issue one or more additional patents to us or that any court will rule in our favor in the event of a dispute related to our intellectual property. In the absence of further patent protection, it may be more difficult for us to achieve commercial production of the TriFan 600.

Any material disruption in our information systems could adversely affect our business.

Our systems, or those of third parties upon which we rely, may experience service interruptions, outages, or degradation because of hardware and software defects or malfunctions, human error or intentional bad acts by third parties or our employees, contractors, or service providers, natural disasters, power losses, disruptions in telecommunications services, fraud, military or political conflicts, terrorist attacks, cyberattacks or other events. Our insurance may not be sufficient, and we may not have sufficient remedies available to us from our third-party service providers, to cover all of our losses that may result from such issues which may have an adverse impact on our business, financial condition and results of operations.

Privacy concerns in the territories in which we operate could result in additional costs and liabilities to us or inhibit sales of our aircraft.

The regulatory framework for privacy issues worldwide is rapidly evolving and is likely to remain uncertain for the foreseeable future. Many government bodies and agencies have adopted or are considering adopting laws and regulations regarding the collection, use, storage and disclosure of personal information and breach notification procedures. We are also required to comply with laws, rules and regulations relating to data security. Interpretation of these laws, rules and regulations and their application to our software and professional services in applicable jurisdictions is ongoing and cannot be fully determined at this time.

In the United States, these include rules and regulations promulgated under the authority of the Federal Trade Commission, the Electronic Communications Privacy Act, the Computer Fraud and Abuse Act, the California Consumer Privacy Act of 2018 (the “CCPA”) and other state and federal laws relating to privacy and data security. By way of example, the CCPA requires covered businesses to provide new disclosures to California residents, provide them new ways to opt-out of certain disclosures of personal information, and allows for a cause of action for data breaches. It includes a framework that includes potential statutory damages and private rights of action. Multiple states have enacted, or are expected to enact, similar or more stringent laws. Additionally, in 2020, Nevada passed SB 220 which restricts the “selling” of personal information and Virginia’s Consumer Data Protection Act (the “CDPA”), which took effect on January 1, 2023 and grants new privacy rights for Virginia residents. There is also discussion in Congress of a new comprehensive federal data protection and privacy law to which we likely would be subject if it is enacted. Such new laws and proposed legislation, if passed, could have conflicting requirements that could make compliance challenging, require us to expend significant resources to come into compliance, and restrict our ability to process certain personal information. There is some uncertainty as to how the CCPA, CDPA and similar privacy laws emerging in other states, could impact our business as it depends on how such laws will be interpreted. As we expand our operations, compliance with privacy laws may increase our operating costs.

Our ability to use our net operating loss carryforwards and certain other tax attributes may be limited.

As of December 31, 2022, the Company has federal net operating loss carryforwards (“NOLs”) of approximately $11,780,633, of which $1,420,065 will begin to expire in 2036 and the remainder do not expire. Under the Tax Cuts and Jobs Act, federal NOLs generated by us in tax years through December 31, 2017 may be carried forward for 20 years and may fully offset taxable income in the year utilized and federal NOLs generated by us in tax years beginning after December 31, 2017 may be carried forward indefinitely but may only be used to offset 80% of our taxable income annually. Under Sections 382 and 383 of the Code, if a corporation undergoes an “ownership change,” the corporation’s ability to use its pre-change federal NOLs and other tax attributes (such as research and development tax credits) to offset its post-change income and taxes may be limited. In general, an “ownership change” occurs if there is a greater than 50 percentage point change (by value) in a corporation’s equity ownership by certain stockholders over a rolling three-year period. We may have experienced ownership changes in the past and may experience ownership changes in the future as a result of subsequent shifts in our stock ownership (some of which shifts are outside our control). As a result, our ability to use our pre-change federal NOLs and other tax attributes to offset future taxable income and

taxes could be subject to limitations. Similar provisions of state tax law may also apply. For these reasons, even if we achieve profitability, we may be unable to use a material portion of our NOLs and other tax attributes which may have an adverse impact on our business, financial condition and results of operations.

We may enter into joint venture, teaming and other arrangements, and these activities involve risks and uncertainties. A failure of any such relationship could have material adverse results on our business and results of operations.

We may enter into joint venture, teaming and other arrangements. These activities involve risks and uncertainties, including the risk of the joint venture or applicable entity failing to satisfy its obligations, which may result in certain liabilities to us for guarantees and other commitments, the challenges in achieving strategic objectives and expected benefits of the business arrangement, the risk of conflicts arising between us and our partners and the difficulty of managing and resolving such conflicts, and the difficulty of managing or otherwise monitoring such business arrangements. In addition, we do not currently have arrangements in place that will allow us to fully execute our business plan, including, without limitation, final supply and manufacturing agreements. Moreover, existing or future arrangements may contain limitations on our ability to enter into arrangements with other partners. A failure of our business relationships could have a material adverse effect on our business and results of operations.

If we are unable to obtain and maintain adequate facilities and infrastructure, we may be unable to develop and manufacture the aircraft as expected.

In order to develop and manufacture our aircraft, we must be able to obtain and maintain adequate facilities and infrastructure. We may be unsuccessful in obtaining, developing and/or maintaining these facilities in a commercially viable manner. Even if we are able to begin assembly operations in these facilities, maintenance of these facilities will require considerable capital expenditure as we expand operations. We cannot provide any assurance that we will be successful in obtaining and maintaining adequate facilities and infrastructure, and any failure to do so may result in our inability to develop and manufacture our aircraft as expected or on the timelines projected, which would adversely affect our business, financial condition and results of operations.

We have been, and may in the future be, adversely affected by health epidemics and pandemics, including the ongoing global COVID-19 pandemic, the duration and economic, governmental and social impact of which is difficult to predict, which may significantly harm our business, prospects, financial condition and operating results.

We face various risks related to public health issues, including epidemics, pandemics and other outbreaks, including the ongoing COVID-19 pandemic. The impact of the COVID-19 pandemic, including changes in consumer and business behavior, pandemic fears and market downturns, supply shortages and restrictions on business and individual activities, has created significant volatility in the global economy. The spread of COVID-19 has also created a disruption in the manufacturing, delivery and overall supply chain of aircraft manufacturers and suppliers. The extent to which the COVID-19 pandemic impacts our business, prospects and results of operations will depend on future developments, which are highly uncertain and cannot be predicted, including, but not limited to, the duration and spread of the pandemic, its severity, the actions to contain the virus and its variants or treat its impact and how quickly and to what extent normal economic and operating activities can resume. Even after the COVID-19 pandemic has subsided, we may continue to experience an adverse impact to our business as a result of COVID-19’s global economic impact, including ongoing inflationary pressures.

We are subject to risks associated with climate change, including the potential increased impacts of severe weather events on our operations and infrastructure.

The potential physical effects of climate change, such as increased frequency and severity of high wind conditions, storms, floods, fires, fog, mist, freezing conditions, sea-level rise and other climate-related events, could affect our operations, infrastructure and financial results. Climate change risks could result in but are not limited to operational risk from the physical effect of climate events on our terminal facilities, production facilities and other assets, as well as transitional risks, including new or more stringent regulatory requirements, increased monitoring and disclosure requirements, and potential effects on our reputation and/or changes in our business. We could incur significant costs to improve the climate resiliency of our aircraft or infrastructure and otherwise prepare for, respond to, and mitigate such physical effects of climate change. We are not able to accurately predict the materiality of any potential losses or costs associated with the physical effects of climate change.

CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS

This proxy statement/prospectus contains forward-looking statements (including within the meaning of Section 21E of the Exchange Act and Section 27A of the Securities Act) concerning, among other things, the following:

•        the anticipated benefits of the merger;

•        the ability of Inpixon and XTI to complete the merger, and whether and when the business combination will be consummated;

•        the ability to obtain or maintain the listing of the combined company’s common stock on the Nasdaq following the business combination;

•        the anticipated costs associated with the merger;

•        the combined company’s public securities’ potential liquidity and trading;

•        the combined company’s ability to raise financing in the future;

•        the ability to successfully execute its business, marketing, and other strategies;

•        the ability to achieve or maintain profitability in the future;

•        the ability to meet the development and commercialization schedule with respect to the TriFan 600;

•        the ability to develop other new products and technologies;

•        the ability to secure required certifications for the TriFan 600 and/or any other aircraft it develops;

•        the ability to navigate the regulatory environment and complexities with compliance related to such environment;

•        the ability to attract customers and/or fulfill customer orders;

•        the ability to enhance and maintain the reputation of its brand and flight experience and expand its customer base;

•        the ability to scale in a cost-effective manner and maintain and expand its manufacturing and supply chain relationships;

•        the ability to attract, integrate, manage, and retain qualified personnel or key employees;

•        the ability to operate in a competitive market;

•        the ability to respond to a failure of its systems and technology to operate its business;

•        the ability to protect its intellectual property;

•        the ability to respond to a noteworthy accident or incident involving its aircraft;

•        the ability to respond to health epidemics, geopolitical events and general economic conditions;

•        the ability to continue as a going concern;

•        the outcome of any known and unknown litigation and regulatory proceedings; and

•        the ability to anticipate the impact of changes in U.S. tax laws.

These forward-looking statements should not be relied upon as predictions of future events as Inpixon and XTI cannot assure you that the events or circumstances reflected in these statements will be achieved or will occur. You can identify forward-looking statements by the use of forward-looking terminology including “believes,” “expects,” “may,” “will,” “should,” “seeks,” “intends,” “plans,” “pro forma,” “estimates,” or “anticipates” or the negative of these words and phrases or other variations of these words and phrases or comparable terminology. All statements other

than statements of historical fact are statements that could be deemed forward-looking statements. Actual results could differ materially from those contained in any forward-looking statement as a result of various factors, including, without limitation:

•        the risk that the proposed transaction may not be completed in a timely manner or at all, which may adversely affect the price of Inpixon’s securities;

•        the failure to satisfy the conditions to the consummation of the proposed transaction, including the adoption of the merger agreement by the shareholders of Inpixon;

•        the occurrence of any event, change or other circumstance that could give rise to the termination of the merger agreement;

•        the adjustments permitted under the Merger Agreement to the exchange ratio that could result in XTI shareholders or Inpixon shareholders owning less of the post-combination company than expected;

•        the effect of the announcement or pendency of the proposed transaction on Inpixon’s and XTI’s business relationships, performance, and business generally;

•        risks that the proposed transaction disrupts current plans of Inpixon and XTI and potential difficulties in Inpixon’s and XTI’s employee retention as a result of the proposed transaction;

•        the outcome of any legal proceedings that may be instituted against XTI or against Inpixon related to the merger agreement or the proposed transaction;

•        failure to realize the anticipated benefits of the proposed transaction;

•        the inability to meet and maintain the listing of Inpixon’s securities (or the securities of the post-combination company) on Nasdaq;

•        the risk that the price of Inpixon’s securities (or the securities of the post-combination company) may be volatile due to a variety of factors, including changes in the highly competitive industries in which Inpixon and XTI operate, variations in performance across competitors, changes in laws, regulations, technologies that may impose additional costs and compliance burdens on Inpixon and XTI’s operations, global supply chain disruptions and shortages, national security tensions, and macro-economic and social environments affecting Inpixon and XTI’s business and changes in the combined capital structure;

•        the inability to implement business plans, forecasts, and other expectations after the completion of the proposed transaction, and identify and realize additional opportunities;

•        the risk that XTI has a limited operating history, has not yet manufactured any non-prototype aircraft or delivered any aircraft to a customer, and XTI and its current and future collaborators may be unable to successfully develop and market XTI’s aircraft or solutions, or may experience significant delays in doing so;

•        the risk that XTI is subject to the uncertainties associated with the regulatory approvals of its aircraft including the certification by the Federal Aviation Administration, which is a lengthy and costly process;

•        the risk that the post-combination company may never achieve or sustain profitability;

•        the risk that XTI, Inpixon and the post-combination company may be unable to raise additional capital on acceptable terms to finance its operations and remain a going concern;

•        the risk that the post-combination company experiences difficulties in managing its growth and expanding operations;

•        the risk that XTI’s conditional pre-orders (which include conditional aircraft purchase agreements, non-binding reservations, and options) are canceled, modified, delayed or not placed and that XTI must return the refundable deposits;

•        the risks relating to long development and sales cycles, XTI’s ability to satisfy the conditions and deliver on the orders and reservations, its ability to maintain quality control of its aircraft, and XTI’s dependence on third parties for supplying components and potentially manufacturing the aircraft;

•        the risk that other aircraft manufacturers develop competitive VTOL aircraft or other competitive aircraft that adversely affect XTI’s market position;

•        the risk that XTI’s future patent applications may not be approved or may take longer than expected, and XTI may incur substantial costs in enforcing and protecting its intellectual property;

•        the risk that XTI’s estimates of market demand may be inaccurate;

•        the risk that XTI’s ability to sell its aircraft may be limited by circumstances beyond its control, such as a shortage of pilots and mechanics who meet the training standards, high maintenance frequencies and costs for the sold aircraft, and any accidents or incidents involving VTOL aircraft that may harm customer confidence; and

•        other risks and uncertainties set forth in the sections entitled “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements” in Inpixon’s Annual Report on Form 10-K for the year ended December, 31, 2022, which was filed with the SEC on April 17, 2023 (the “2022 Form 10-K”), Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2023 filed on May 16, 2023 and Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2023 filed on August 18, 2023, and in the section entitled “Risk Factors” in XTI’s periodic reports filed pursuant to Regulation A of the Securities Act including XTI’s Annual Report on Form 1-K for the year ended December 31, 2022, which was filed with the SEC on July 13, 2023 (the “2022 Form 1-K”), as such factors may be updated from time to time in Inpixon’s and XTI’s filings with the SEC, the registration statement on Form S-4 and the proxy statement/prospectus contained therein. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements.

The foregoing risks should not be construed as exhaustive and should be read in conjunction with statements that are included herein and elsewhere. Inpixon and XTI can give no assurance that the conditions to the merger will be satisfied. For further discussion of the factors that may cause Inpixon, XTI or the combined company’s actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied in such forward-looking statements, or for a discussion of risks associated with the ability of Inpixon and XTI to complete the merger and the effect of the merger on the business of Inpixon, XTI and the combined company, see the section entitled “Risk Factors” in this proxy statement/prospectus.

Additional factors that could cause actual results to differ materially from those expressed in the forward-looking statements are discussed in reports filed with the SEC by Inpixon. See the section entitled “Where You Can Find More Information” of this proxy statement/prospectus.

If any of these risks or uncertainties materialize or any of these assumptions prove incorrect, the results of operations of Inpixon, XTI or the combined company could differ materially from the forward-looking statements. All forward-looking statements in this proxy statement/prospectus are current only as of the date of this proxy statement/prospectus. Inpixon and XTI do not undertake any obligation to publicly update any forward-looking statement to reflect events or circumstances after the date on which any statement is made, the occurrence of unanticipated events or any new information that becomes available in the future.

THE SPECIAL MEETING OF INPIXON STOCKHOLDERS

Date, Time and Place

The Inpixon special meeting will be held on December [    ], 2023, commencing at 10:00 A.M., Pacific Time. The Inpixon special meeting will be a completely virtual meeting of Inpixon stockholders conducted via live virtual meeting. You will be able to attend the Inpixon special meeting by visiting www.virtualshareholdermeeting.com/INPX2023SM and entering your control number as further explained in the accompanying proxy statement/prospectus. Inpixon is sending this proxy statement/prospectus to Inpixon stockholders in connection with the solicitation of proxies by the Inpixon Board for use at the Inpixon special meeting and any adjournments or postponements of the Inpixon special meeting. This proxy statement/prospectus is first being furnished to Inpixon stockholders on or about [            ], 2023.

Purposes of the Inpixon Special Meeting

The purposes of the Inpixon special meeting are:

1.      to consider and vote upon a proposal to approve the issuance of shares of Inpixon common stock to equity holders of XTI pursuant to the terms of the Merger Agreement, and the change of control of Inpixon resulting from the merger, pursuant to Nasdaq Listing Rules 5635(a) and 5635(b), respectively (the “Nasdaq Stock Issuance Proposal” or “Proposal No. 1”);

2.      to consider and vote on an advisory, non-binding basis to approve merger-related executive compensation for Inpixon’s executive officers (the “Transaction Bonus Plan Proposal” or “Proposal No. 2”);

3.      to elect five directors to serve until our next annual meeting of stockholders or until the election and qualification of their successors (the “Director Election Proposal” or “Proposal No. 3”);

4.      to consider and vote on an advisory, non-binding basis to approve of the compensation paid to our named executive officers (the “Say-on-Pay Proposal” or “Proposal No. 4”);

5.      to ratify the appointment of Marcum LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2023 (the “Auditor Ratification Proposal” or “Proposal No. 5”);

6.      to consider and vote on an amendment to Inpixon’s Restated Articles of Incorporation, as amended (the “Articles of Incorporation”) to increase the number of authorized shares of Inpixon common stock to up to 1,000,000,000 shares, with such number to be determined at the Board’s discretion (the “Authorized Share Increase Proposal” or “Proposal No. 6”);

7.      to consider and vote on an increase in the reverse split ratio previously approved by the stockholders of Inpixon at the special meeting of Inpixon stockholders held on September 29, 2023, from a ratio of 1-for-2 to 1-for-50 to a ratio of 1-for-2 to 1-for-200 (the “Reverse Split Ratio Proposal” or “Proposal No. 7”);

8.      To consider and vote on a proposal to approve potential issuances of shares of Inpixon common stock pursuant to one or more potential non-public transactions in accordance with Nasdaq Listing Rule 5635(d) (the “Potential Financing Issuances Proposal” or “Proposal No. 8”);

9.      to consider and vote upon an adjournment of the Inpixon special meeting, if necessary, to solicit additional proxies if there are not sufficient votes in favor of Proposal Nos. 1, 3, 6, 7 and 8 above (the “Adjournment Proposal” or “Proposal No. 9”); and

10.    to transact such other business as may properly come before the Inpixon special meeting or any adjournment or postponement thereof.

Recommendation of the Inpixon Board

•        The Inpixon Board has approved the issuance of Inpixon common stock to XTI equityholders pursuant to the Merger Agreement and the change of control of Inpixon resulting from the merger. The Inpixon Board recommends that Inpixon stockholders vote “FOR” Proposal No. 1 to approve the issuance of the Inpixon securities described above and the change of control of Inpixon resulting from the merger.

•        The Inpixon Board has approved merger-related executive compensation for Inpixon’s executive officers. The Inpixon Board recommends that Inpixon stockholders vote “FOR” Proposal No. 2 to approve the merger-related executive compensation.

•        The Inpixon Board has approved the nominees for Inpixon’s board of directors. The Inpixon Board recommends that Inpixon stockholders vote “FOR” each director nominee in Proposal No. 3.

•        The Inpixon Board has approved the current compensation paid to Inpixon’s named executive officers. The Inpixon Board recommends that Inpixon stockholders vote “FOR” Proposal No. 4 to approve on an advisory basis the compensation paid to Inpixon’s named executive officers.

•        The Inpixon Board has approved the appointment of Marcum LLP as Inpixon’s independent registered public accounting firm for the fiscal year ending December 31, 2023. The Inpixon Board recommends that Inpixon stockholders vote “FOR” Proposal No. 5 to ratify such appointment of Marcum LLP.

•        The Inpixon Board has approved the amendment to Inpixon’s Articles of Incorporation to increase the number of authorized shares of Inpixon common stock to up to 1,000,000,000 shares. The Inpixon Board recommends that Inpixon stockholders vote “FOR” Proposal No. 6 to approve the amendment increasing the number of authorized shares of Inpixon common stock to up to 1,000,000,000 shares.

•        The Inpixon Board has approved the increase of the maximum reverse split ratio previously approved by the stockholders of Inpixon from a ratio of 1-for-50 to 1-for-200. The Inpixon Board recommends that Inpixon stockholders vote “FOR” Proposal No. 7 to approve the increase to the previously approved maximum reverse split ratio to 1-for-200.

•        The Inpixon Board has approved the potential issuances of shares of Inpixon common stock pursuant to one or more potential non-public transactions in accordance with Nasdaq Listing Rule 5635(d). The Inpixon Board recommends that Inpixon stockholders vote “FOR” Proposal No. 8 to approve the potential issuances of shares of Inpixon common stock pursuant to one or more potential non-public transactions in accordance with Nasdaq Listing Rule 5635(d).

•        The Inpixon Board has approved adjourning the Inpixon special meeting, if necessary, to solicit additional proxies if there are not sufficient votes in favor of the Nasdaq Stock Issuance Proposal or the Director Election Proposal. The Inpixon Board recommends that Inpixon stockholders vote “FOR” the Adjournment Proposal adjourn the Inpixon special meeting, if necessary, to solicit additional proxies if there are not sufficient votes in favor of the Nasdaq Stock Issuance Proposal and the Director Election Proposal.

Record Date and Voting Power

Only holders of record of Inpixon common stock at the close of business on the Record Date, October 24, 2023, are entitled to notice of, and to vote at, the Inpixon special meeting. There were 59 holders of record of Inpixon common stock at the close of business on the Record Date. At the close of business on the Record Date, 127,688,550 shares of Inpixon common stock were issued and outstanding. Each share of Inpixon common stock entitles the holder thereof to one vote on each matter submitted for stockholder approval.

Voting and Revocation of Proxies

The proxy accompanying this proxy statement/prospectus is solicited on behalf of the Inpixon Board for use at the Inpixon special meeting.

If you are a stockholder of record of Inpixon as of the Record Date referred to above, you may vote virtually at the Inpixon special meeting or vote by proxy. Whether or not you plan to attend the Inpixon special meeting, Inpixon urges you to vote by proxy to ensure your vote is counted. You may still attend the Inpixon special meeting and vote virtually if you have already voted by proxy. As a stockholder of record you may vote in any of the following ways:

•        to vote virtually, attend the Inpixon special meeting and Inpixon will provide you a ballot when you arrive.

•        to vote using the proxy card, simply mark, sign and date your proxy card and return it promptly in the postage-paid envelope provided. If you return your signed proxy card to Inpixon before the Inpixon special meeting, Inpixon will vote your shares as you direct on the proxy card.

•        to vote by telephone or on the Internet, dial the number on the proxy card or visit the website on the proxy card form to complete an electronic proxy card. You will be asked to provide Inpixon’s number and control number from the enclosed proxy card. Your vote must be received by 11:59 p.m., Eastern Time on [______], 2023 to be counted.

If your shares of Inpixon common stock are held by your broker, bank or other nominee, that is, in “street name,” you will receive a voting instruction card from the institution that holds your shares. Please follow the instructions included on that voting instruction card regarding how to instruct your broker, bank or other nominee to vote your shares of Inpixon common stock. If you are a beneficial owner you may not vote your shares virtually at the Inpixon special meeting unless you obtain a legal proxy from your broker, bank or other nominee. If you do not give instructions to your broker, bank or other nominee, your broker can vote your shares of Inpixon common stock with respect to “discretionary” items but not with respect to “non-discretionary” items. Discretionary items are proposals considered routine under certain rules applicable to brokers and on which your broker may vote shares held in “street name” in the absence of your voting instructions. On non-discretionary items for which you do not give your broker instructions, your shares of Inpixon common stock will be treated as broker non-votes. It is anticipated that the Nasdaq Stock Issuance Proposal, the Transaction Bonus Plan Proposal, the Say-on-Pay Proposal, the Director Election Proposal, the Authorized Share Increase Proposal, the Potential Financing Issuances Proposal and the Adjournment Proposal will be non-discretionary. To make sure that your vote is counted, you should instruct your broker to vote your shares, following the procedures provided by the institution that holds your shares.

Inpixon stockholders of record may change their vote at any time before their proxy is voted at the Inpixon special meeting in one of three ways. First, an Inpixon stockholder of record can send a written notice to the Secretary of Inpixon stating that the stockholder would like to revoke its proxy. Second, an Inpixon stockholder of record can submit new proxy instructions either on a new proxy card or by telephone or via the Internet. Third, an Inpixon Stockholder of record can attend the Inpixon special meeting and vote virtually. Attendance alone will not revoke a proxy. If a stockholder who owns shares of Inpixon common stock in “street name” has instructed a broker to vote its shares of Inpixon common stock, the stockholder must follow directions received from its broker to change those instructions.

All properly executed proxies that are not revoked will be voted at the Inpixon special meeting and at any adjournments or postponements of the Inpixon special meeting in accordance with the instructions contained in the proxy. If a holder of Inpixon common stock executes and returns a proxy and does not specify otherwise, the shares represented by that proxy will be voted “FOR” the Nasdaq Stock Issuance Proposal to approve the issuance of shares of Inpixon common stock to XTI equityholders pursuant to the Merger Agreement and the change of control resulting from the merger; “FOR” the Transaction Bonus Plan Proposal to approve merger-related executive compensation for Inpixon’s executive officers; “FOR” each of the Inpixon director nominees in the Director Election Proposal; “FOR” the Say-on-Pay Proposal to approve, on an advisory basis, the compensation of Inpixon’s Named Executive Officers; “FOR” the Auditor Ratification Proposal to ratify the appointment of Marcum LLP as Inpixon’s independent registered public accounting firm; “FOR” the Authorized Share Increase Proposal to increase the number of authorized shares of Inpixon common stock to up to 1,000,000,000 shares, “FOR” the Reverse Split Ratio Proposal to increase the maximum reverse split ratio previously approved by Inpixon stockholders from 1-for-50 to 1-for-200, “FOR” the Potential Financing Issuances Proposal to issue shares of Inpixon common stock pursuant to one or more potential non-public transactions in accordance with Nasdaq Listing Rule 5635(d), and “FOR” the Adjournment Proposal to approve the adjournment of the Inpixon special meeting, if necessary, to solicit additional proxies if there are not sufficient votes in favor of the Nasdaq Stock Issuance Proposal, the Director Election Proposal, the Authorized Share Increase Proposal, the Reverse Split Ratio Proposal or the Potential Financing Issuances Proposal in accordance with the recommendation of the Inpixon Board.

Required Vote

The presence, virtually or by proxy, of the holders of Inpixon’s issued and outstanding shares of Inpixon common stock at the Inpixon special meeting is necessary to constitute a quorum at the meeting. Abstentions will be counted towards a quorum. Approval of the Nasdaq Stock Issuance Proposal, the Transaction Bonus Plan Proposal, the Say-on-Pay Proposal, the Auditor Ratification Proposal, the Reverse Split Ratio Proposal, the Potential Financing Issuances Proposal and the Adjournment Proposal requires the affirmative vote of a majority of the votes cast by the

holders of Inpixon common stock present virtually or by proxy at the Inpixon special meeting and entitled to vote on the matter. The affirmative vote of the holders of shares of Inpixon common stock representing a majority of the voting power outstanding as of the Record Date is required for approval of the Authorized Share Increase Proposal.

Votes will be counted by the inspector of election appointed for the Inpixon special meeting, who will separately count “FOR” and “AGAINST” votes, abstentions and broker non-votes. Abstentions will be counted towards the vote total. Abstentions and broker non-votes will have no effect on the Nasdaq Stock Issuance Proposal, the Transaction Bonus Plan Proposal, the Director Election Proposal, the Say-on-Pay Proposal, the Auditor Ratification Proposal, the Reverse Split Ratio Proposal, the Potential Financing Issuances Proposal and the Adjournment Proposal, and will have the same effect as votes AGAINST the Authorized Share Increase Proposal.

The merger cannot be consummated without the approval of the Nasdaq Stock Issuance Proposal.

For the Director Election Proposal, the election of Inpixon directors, the nominees will be elected by a majority of the votes cast by the holders of Inpixon common stock present virtually or represented by proxy and entitled to vote in the election. You may choose to vote FOR, AGAINST, or ABSTAIN separately for each nominee. A properly executed proxy or voting instructions marked ABSTAIN with respect to the election of one or more directors will not be voted with respect to the director or directors indicated, although it will be counted for the purposes of determining whether there is a quorum. Stockholders may not cumulate votes in the election of directors, which means that each stockholder may vote no more than the number of votes such stockholder is entitled to cast for a single director candidate.

Solicitation of Proxies

In addition to solicitation by mail, the directors, officers, employees and agents of Inpixon may solicit proxies from Inpixon stockholders by personal interview, telephone, telegram or otherwise. Inpixon and XTI will share equally the costs of printing and filing this proxy statement/prospectus and proxy card. Arrangements will also be made with brokerage firms and other custodians, nominees and fiduciaries who are record holders of Inpixon common stock for the forwarding of solicitation materials to the beneficial owners of Inpixon common stock. Inpixon will reimburse these brokers, custodians, nominees and fiduciaries for the reasonable out-of-pocket expenses they incur in connection with the forwarding of solicitation materials. Inpixon may engage a proxy solicitor to assist in the solicitation of proxies and provide related advice and informational support. If we engage a proxy solicitor we would expect to pay the proxy solicitor fees an estimated $12,500 and the reimbursement of customary disbursements.

Other Matters

As of the date of this proxy statement/prospectus, the Inpixon Board does not know of any business to be presented at the Inpixon special meeting other than as set forth in the notice accompanying this proxy statement/prospectus. If any other matters should properly come before the Inpixon special meeting, it is intended that the shares represented by proxies will be voted with respect to such matters in accordance with the judgment of the persons voting the proxies.

THE MERGER

This section and the section entitled “The Merger Agreement” in this proxy statement/prospectus describe the material aspects of the merger, including the Merger Agreement. While Inpixon and XTI believe that this description covers the material terms of the merger and the Merger Agreement, it may not contain all of the information that is important to you. You should read carefully this entire proxy statement/prospectus for a more complete understanding of the merger and the Merger Agreement, including the Merger Agreement attached as Annex A, the opinion of GVS attached as Annex B, and the other documents to which you are referred herein. See the section entitled “Where You Can Find More Information” in this proxy statement/prospectus.

Background to the Merger

Inpixon is a company incorporated in Nevada on April 8, 1999. Inpixon is the Indoor Intelligence™ company. Our solutions and technologies help organizations create and redefine exceptional experiences that enable smarter, safer and more secure environments. Inpixon customers can leverage our real-time positioning, mapping and analytics technologies to achieve higher levels of productivity and performance, increase safety and security, improve worker and employee satisfaction rates and drive a more connected work environment. We have focused our corporate strategy on being the primary provider of the full range of foundational technologies needed to form a comprehensive suite of solutions that make indoor data available and actionable to organizations and their employees. Together, our technologies allow organization to create and utilize the digital twin of a physical location and to deliver enhanced experiences in their current environment and in the metaverse. In addition to our Indoor Intelligence technologies and solutions, we also offer digital solutions (eTearsheets; eInvoice, and adDelivery) or cloud-based applications and analytics for the advertising, media and publishing industries through our advertising management platform referred to as Shoom by Inpixon; and a comprehensive set of data analytics and statistical visualization solutions for engineers and scientists referred to as SAVES by Inpixon.

Over the last few years, Inpixon pursued a corporate strategy that was focused on enhancing shareholder value and building and developing its business as a provider of end-to-end solutions ranging from the collection of data to delivering insights from that data to its customers with a focus on securing, digitizing, and optimizing premises with its indoor positioning, mapping and analytics solutions for businesses and governments. In furtherance of this strategy, Inpixon regularly considered opportunities for strategic business combinations. Inpixon received and responded to requests for potential transaction proposals from third parties and actively pursued possible business combination transactions with those third parties. In addition, from time to time, Inpixon’s senior management team engaged in informal discussions regarding possible business combination transactions with their counterparts at other companies that offered technologies and solutions that were complementary to Inpixon’s suite of indoor data and location-based technologies and products. Generally, in connection with these discussions, Inpixon and the other party would sign a non-disclosure agreement and in certain instances a preliminary non-binding letter of intent or exclusivity letter, and then share financial and other business and operations information.

The Inpixon Board received regular updates from management concerning potential strategic transaction opportunities, and the topic of potential strategic acquisition transactions was a recurring agenda item at many board meetings and topic of discussion with Inpixon financial advisors. In addition, the Inpixon Board determined that Kareem Irfan, a director or Inpixon, would provide additional support and assistance to Nadir Ali, the Chief Executive Officer of Inpixon, and the management team in connection with the evaluation and review of strategic opportunities presented to the company. Inpixon executed a number of strategic transactions in connection with some of these discussions where the business, technologies and teams were complementary to the Inpixon goals of enhancing its platform and technology, adding diversification or differentiation, expanding its customer base and adding revenue. In other instances, Inpixon determined not to pursue certain opportunities for a variety of reasons which may have been because the potential transaction was not viewed as accretive to Inpixon, there may have been concerns over the business fundamentals of the potential target company or failure to agree on prices, terms or conditions.

In December 2021, Inpixon’s Board authorized its management team to review strategic alternatives, including an asset sale, merger with another company or spin-off of one or more of its business units aimed at maximizing shareholder value. Inpixon looked at a wide range of potential strategic transactions, companies, and structures to affect this strategy. Inpixon evaluated over a dozen different companies and negotiated three non-binding letters of intent in its search for strategic partners and transactions that it believes could potentially increase shareholder value, consisting of a letter of intent with KINS Technology Group, Inc. (“KINS”) which became mutually exclusive (with respect to Inpixon, only as to Inpixon’s Design Reactor subsidiary and enterprise apps business) from August 18, 2022 until the closing of the KINS transaction, a letter of intent with XTI executed on September 12, 2022 as described in

further detail below, and a letter of intent with Damon Motors, Inc. (“Damon”) which had no exclusivity or no-shop provision (see discussion under “Recent Events — Grafiti Holding Spin-off and Proposed Business Combination between Grafiti Holding and Damon Motors” in the section “Inpixon Management’s Discussion and Analysis of Financial Condition and Results of Operations” contained elsewhere in this proxy statement/prospectus for further information about Inpixon’s proposed spin-off of Grafiti Holding Inc., a newly formed subsidiary of Inpixon to which Inpixon will transfer all of the shares of Inpixon Limited, a United Kingdom limited company operating Inpixon’s SAVES line business in the UK, and the proposed business combination between Grafiti Holding Inc. and Damon, as part of the solutions business divestiture contemplated by the merger agreement with XTI. In addition, on October 21, 2021, Inpixon entered into a unilateral exclusivity letter with a fourth company pursuant to which that company agreed to a no-shop period ending December 31, 2021, which no-shop obligation applied only to that company, not Inpixon.

Inpixon recently completed a spin-off of its enterprise apps business and related business combination with KINS, which was a special purpose acquisition company prior to such business combination, pursuant to which Inpixon stockholders received shares of KINS common stock valued at approximately $70 million. Now Inpixon is pursuing the transactions contemplated by the Merger Agreement with XTI with the goal of further delivering additional value for its shareholders.

The following chronology summarizes the key meetings and events that led to the signing of the Merger Agreement.

This chronology does not purport to catalogue every correspondence among representatives of Inpixon and XTI. Representatives of Inpixon involved in the discussions and negotiations referenced herein included one or more of Mr. Nadir Ali, Chief Executive Officer of Inpixon and Ms. Melanie Figueroa, General Counsel and Chief of Staff of Inpixon and Soumya Das, Chief Operating Officer of Inpixon. Representatives of XTI involved in the discussions and negotiations referenced herein included one or more of Mr. Scott Pomeroy, Chief Financial Officer of XTI, Mr. David Brody, Founder and Board Member of XTI, John Griffo, VP of Finance and Ms. Mara Babin, General Counsel of XTI.

On December 8, 2021, Inpixon Board held a meeting during which Mr. Ali provided an update on the status of ongoing discussions and the due diligence review process with a third-party entity (Party A) from which Inpixon had received an inbound preliminary indication of interest in relation to a strategic transaction. In addition, the Inpixon Board also considered whether it would be beneficial to update the company’s shareholders regarding the nature of the potential transactions that the company was evaluating and the receipt of the preliminary indications of interest. Subsequently, on December 14, 2021, Inpixon issued a press release announcing that the Inpixon Board had authorized management to consider potential strategic alternatives other than acquisition transactions, including asset sales, mergers with other companies or spin-offs of one or more business units to maximize shareholder value. Discussions were ongoing and a due diligence process continued between Inpixon and this third party over the next several months, however, the parties were ultimately not able to come to agreement on terms and conditions and the discussions ceased. Inpixon management continued to explore potential opportunities as they arose.

Around May of 2022, representatives of Maxim Group LLC (“Maxim”) advised Mr. Ali of a potential opportunity for a strategic transaction with a company in the VTOL industry. At this time, it was unclear whether Inpixon would be able to come to agreeable terms for a successful transaction with Party A, therefore Mr. Ali requested that Maxim arrange an introductory call with this party.

On May 18, 2022, following the introduction arranged by Maxim, Mr. Ali and Ms. Figueroa had an introductory call with Mr. Robert LaBelle (former CEO of XTI) and Ms. Sarita Jha (former CFO of XTI) to consider a potential merger of XTI with Inpixon. On May 18, 2022, Inpixon and XTI executed a mutual non-disclosure agreement so the parties could share more information and on May 25, 2022, the parties met in Denver, CO along with their bankers and advisors.

On May 29, 2022, Mr. Ali sent Mr. LaBelle and Ms. Jha a slide presentation of preliminary proposed deal terms for discussion purposes along with a proposed structure chart; timeline; and other considerations. The proposed deal terms provided for an assumed enterprise value of $225 million for XTI and a minimum net cash requirement of $21.5 million for Inpixon. This was followed up by a draft letter of intent on June 17, 2022, sent by Ms. Figueroa to Mr. LaBelle and Ms. Jha for discussion purposes.

On June 15, 2022, Mr. Ali updated the Inpixon Board noting that discussions with Party A had stalled but that there have been other parties that had approached Inpixon with interest in certain parts of its business and that Inpixon’s banking advisors suggested that Inpixon consider divesting certain assets which could result in a higher valuation for parts of the business as contrasted with the sale of the entire business.

This correspondence was followed by a meeting of the Inpixon Board held on June 16, 2022, pursuant to which Mr. Ali provided a more detailed update to the Inpixon Board regarding the status of discussions in connection with certain opportunities under management review and evaluation, including the stalled discussions with Party A which were unlikely to move forward, noting that if discussions resumed it was believed that the current financial conditions and market volatility were likely to lead to lower valuations. Mr. Ali also advised the Inpixon Board that there had been other strategic opportunities presented to the company related to various parties of the business. Mr. Ali also indicated that the Inpixon executive team was evaluating budget reductions and layoffs given the uncertainty that was developing in the economy and the financial markets.

Separately, Inpixon and XTI had a follow up conference call on June 13, 2022 to discuss the potential structure of a transaction. On June 22, 2022, XTI publicly announced that Michael Hinderberger had been named the new CEO of XTI. On July 12, 2022, the parties had a conference call and XTI informed Inpixon that Mr. LaBelle and Ms. Jha were no longer with XTI, but that XTI was still interested in moving forward with Inpixon regarding the merger. After robust discussions and careful consideration, the Inpixon Management team ultimately determined to pursue discussions with XTI regarding a strategic transaction with XTI based on: (i) the disruptive potential of the vertical take-off and landing (VTOL) aircraft XTI is in the process of developing, (ii) the multi-billion dollar total addressable market opportunity it represents, (iii) the significant interest in XTI’s aircraft demonstrated by the significant number of conditional pre-orders XTI had garnered and (iv) the highly experienced team at XTI that has played a role in taking over 40 aircraft through FAA certification.

On July 7, 2022, Mr. Ali provided an email update to the Inpixon Board including Mr. Kareem Irfan, Mr. Len Oppenheim, Mr. Tanveer Khader and Mrs. Wendy Loundermon, regarding the status of ongoing discussions including the proposed transaction with XTI and the potential transaction with KINS. This email update was followed by an Inpixon Board meeting on July 14, 2022 to discuss both of these transactions in detail and answer any questions on the respective LOIs, process, structure and timelines. All the board members were present and Ms. Figueroa joined the meeting as the secretary of the meeting.

On August 25, 2022, Inpixon and XTI held a conference call for each side to present their overall business and market opportunity. In the meeting, both teams shared their product offering, customer engagement strategy, major sales wins, product roadmap strategy and sales pipeline analysis. After a comprehensive discussion, the parties agreed to follow up on action items requested by the other party and provide additional materials in the data room. Mr. Soumya Das, COO and Mr. Ali presented the Inpixon business and Mr. Brody and Mr. Pomeroy presented the XTI business and were joined by Ms. Babin, Mr. Korhammer and Mr. Ron Levine.

On September 12, 2022 the parties executed a non-binding Letter of Intent (“LOI”). The LOI outlined key terms for a potential reverse triangular merger transaction between Inpixon and XTI as well as next steps for business due diligence. The LOI included a proposed equity split for the combined company of 60% for XTI and 40% for Inpixon, determined on a fully diluted basis including the merger consideration shares. The LOI also included a mutual no-shop provision whereby each party was restricted from soliciting or negotiating any alternative proposal to the proposed merger, for a period from the date of the LOI until the earlier of execution of definitive transaction documents for the merger, termination of negotiations of the merger, or 30 days from the date of the LOI, subject to one automatic extension for an additional period of thirty days unless terminated by either party prior to the end of the initial exclusivity period and so long as each party was continuing to use good faith efforts toward execution of definitive transaction documents for the merger, provided that during the exclusivity period Inpixon was permitted to engage in activities in connection with the divestiture of its assets not related to its industrial apps lines of business, which would be retained by the combined company resulting from the merger, including divestiture of Inpixon’s Shoom, SAVES, Game-Your-Game and enterprise apps lines of business, and each party was permitted to continue raising capital in an amount that would not constitute a change of control of such party. The parties shared initial due diligence request lists with each other and held several calls over the next few weeks between team members on due diligence process; working group roles and responsibilities; etc.

On October 5, 2022, Inpixon and XTI executed an amendment to the LOI which extended the exclusivity provision of the LOI by thirty days, such that the initial exclusivity period would be sixty days from the date of the original LOI, subject to extension by one additional period of thirty days as described above.

On October 9, 2022, Mr. Ali met with Mr. Brody, Mr. Pomeroy, Mr. Korhammer and Mr. Levine in Palo Alto, CA for dinner followed by a meeting the next day at Inpixon’s office to further discuss and define the deal terms and structure for the merger agreement, discuss in more detail each company’s financial statements and other diligence topics. Ms. Babin and Ms. Figueroa joined these discussions on October 10, 2022, by phone.

On October 19, 2022 the first draft of the merger agreement was circulated between the parties followed by additional due diligence meetings and conversations through October 31, 2022 regarding tax, audit, valuation and financial statements. These discussions included the Mrs. Loundermon, Mr. Ali and Ms. Figueroa, from Inpixon; Mr. Veera, Mr. Daneshgar, Mr. Mavrogian and Mr. Tittle from Maxim; Mr. Genady, Mr. Davis, Mr. Kazakov, Mr. Godfrey and Mr. Korhammer from Chardan along with Ms. Babin, Mr. Hinderberger and Mr. Pomeroy.

On November 9, 2022, Inpixon and GVS executed an engagement letter. Inpixon provided GVS with access to the XTI data room to begin their review process.

On December 6, 2022, Inpixon and XTI entered into an amendment to the LOI which provided that the exclusivity period will be further extended for successive periods of thirty days unless terminated by either party prior to the end of the then current exclusivity period.

On December 20, 2022 the parties had a capital/financing strategy discussion along with their respective bankers including Mr. Ali and Ms. Figueroa, from Inpixon; Mr. Veera and Mr. Mavrogian from Maxim; Mr. Genady, Mr. Kazakov, Mr. Godfrey and Mr. Korhammer from Chardan along with Ms. Babin, Mr. Ron Levine and Mr. Pomeroy.

On January 16, 2023 Mr. Ali presented an update to the Inpixon Board on the status of the XTI transaction including on-going due diligence; merger agreement negotiations; need for a shareholder meeting; Nasdaq requirements and need to separate the solutions divestiture products (SAVES, Shoom and certain other assets).

On January 23, 2023 the Inpixon management team reviewed the most recent draft of the merger agreement with their bankers.

On February 7, 2023, Inpixon scheduled a follow-on diligence call with XTI for GVS Partners in connection with the Fairness Opinion. On March 21, 2023 XTI arranged a call with Equitas, their due diligence consultant based in Germany, and Inpixon management including Mr. Soumya Das, COO and Mr. Nadir Ali, CEO to discuss the operations of Inpixon subsidiaries Nanotron and Intranav that are based in Germany. They separately held a meeting with Ms. Figueroa on March 23, 2023, in New York and a call with Mrs. Wendy Loundermon, CFO on May 2, 2023.

On June 7, 2023 the Inpixon Board met to discuss the status of the XTI transaction and certain issues that needed to be resolved including in particular how Inpixon will divest the product lines that XTI was not interested in retaining. Mr. Ali advised the Board that he consulted with Inpixon’s bankers on selling these product lines and/or assets to a third party but the feedback was that it would be difficult given the nature of the businesses, obtaining the valuations would be difficult; they would each require different buyers; banking fees would be cost prohibitive relative to the valuations; and the transaction would be unlikely to occur in the time frame required for the XTI transaction. The Board reviewed the financial statements and valuation of these assets and authorized Mr. Ali to pursue the best possible options to resolve this matter.

On June 9, 2023, Inpixon terminated the exclusivity provision of the LOI by written notice to XTI, notwithstanding its intention to continue negotiating towards completion of the merger. Inpixon terminated the exclusivity provision after receiving notification of a demand letter sent by Xeriant Inc. to XTI (see Note 8 — Commitments and Contingencies of XTI’s financial statements included in this proxy statement/prospectus). Inpixon terminated the exclusivity provision because it believed that would be in the best interests of Inpixon and its stockholders, while XTI continued its efforts to resolve the matter amicably.

From June 8, 2023 through July 24, 2023, the Inpixon and XTI management teams, attorneys from Greenberg Traurig LLP and Arnold & Porter LLP, accountants from Marcum LLP and BF Borgers CPA PC and advisors from Maxim Group LLC and Chardan Capital Markets LLC held bi-weekly status calls to work finalize the merger agreement, exhibits, and ancillary agreements. In addition, there were several direct calls between the management teams, primarily Mr. Ali and Mr. Pomeroy to negotiate the final points of the merger agreement. In particular on July 11, 2023, Mr. Ali and Mr. Pomeroy renegotiated certain of the key terms of the transaction, including, but not limited to increasing XTI’s assumed valuation to $300 million based on the recent valuations completed in connection with the fairness evaluation but maintaining the 60/40 equity ratio; eliminating the minimum cash requirement in exchange for a best-efforts raise of up to $10M in cash at closing.

A meeting of the Inpixon Board was held by videoconference on July 13, 2023, at which GVS presented to the Inpixon Board of directors its summary presentation on the valuation methodology, analysis and results for XTI. Representatives of GVS presented an analysis of their valuation of XTI based on various financial methods,

including market trading multiples of select public companies in the related VTOL aircraft industry segment, comparable transaction multiples of companies with selected target companies that have been a participant of a merger or acquisition transaction in the related industry, and performed such other studies and analyses as deemed appropriate. GVS also discussed the increase in the valuation range of XTI from their initial draft dated April 14, 2023, which indicated an average valuation of $225 million to $300 million in the final draft resulting in an increase in the market caps of the selected VTOL companies from the initial valuation date to the final report dated July 24, 2023. Discussion and Q&A session ensued after the presentation regarding the profile, size and industry of companies selected by GVS for its comparable company analysis, among other things. At this meeting, representatives of GVS delivered its oral opinion that the merger consideration in GVS’s opinion was fair, from a financial point of view. Such opinion was subsequently confirmed by delivery of a written opinion from GVS dated July 24, 2023.

After GVS’s presentation was completed, Mr. Ali presented the final revised terms of the merger agreement and the reasons for the changes as well as an updated timeline for signing of the merger agreement and next steps. The Board reviewed and followed up with questions for Mr. Ali and Ms. Figueroa.

On July 19, 2023, the XTI Board held a meeting to review and approve the Merger Agreement and certain other ancillary documents including the Note and Security Agreement.

On July 23, 2023, the Inpixon Board held a conference call to review the final merger agreement. The Board adopted the associated board resolutions approving the merger agreement and authorizing Mr. Ali to execute the merger agreement with XTI.

Following the meeting of the Inpixon Board and the meeting of the XTI Board, on July 24, 2023, Inpixon, and XTI executed the merger agreement and the related transaction documentations. Following the execution of the merger agreement, on July 24, 2023, representatives of Arnold & Porter sent to representatives of Greenberg Traurig the executed written consent of the XTI Stockholders constituting the XTI Stockholder Approval, which, among other things, approved the merger agreement and the transactions contemplated thereby.

On July 25, 2023, Inpixon and XTI issued press releases announcing the transaction prior to the commencement of trading of the shares of Inpixon Common Stock on Nasdaq followed by filing a Form 8-K at 5:00 p.m. on July 25, 2023.

Inpixon Reasons for the Merger

The Inpixon Board, in evaluating the transaction with XTI, consulted with its legal advisors, as well as its financial and accounting advisors. In reaching its conclusion (i) that the terms and conditions of the Merger Agreement and the transactions contemplated thereby are advisable, fair to and in the best interests of Inpixon and its stockholders and (ii) to recommend that the stockholders approve the issuance of the shares of Inpixon common stock as contemplated by the terms of the Merger Agreement, the Inpixon Board considered and evaluated a number of factors, including, but not limited to, the material factors discussed below. In light of the number and wide variety of factors considered in connection with its evaluation of the transactions contemplated by the Merger Agreement, the Inpixon Board did not consider it practicable to, and did not attempt to, quantify or otherwise assign relative weights to the specific factors that it considered in reaching its determination and supporting its decision. The Inpixon Board viewed its decision as being based on all of the information available and the factors presented to and considered by it. In addition, individual directors may have given different weight to different factors. This explanation of Inpixon’s reasons for the consummation of the transactions contemplated by the Merger Agreement and all other information presented in this section is forward-looking in nature and, therefore, should be read in light of the factors discussed under “Cautionary Statement Regarding Forward-Looking Statements.”

For example, the Inpixon Board considered numerous factors, including the material factors set forth below (the order in which the following factors appear does not reflect any relative significance):

•        Leadership team with decades of aviation experience.    XTI’s founding leadership team possesses decades of aviation experience, with a deep expertise, and proven success bringing new aircrafts to market. Collectively, its founding leadership team has taken over 40 aircrafts through the federal aviation administration certification process. The changes to the senior management in connection with the merger, including the departure of our current CEO or other executive officers, and the transition to the new senior management team could result in us experiencing a loss in productivity while the successor obtains the necessary training and experience. However, the Inpixon Board believes that the anticipated consulting

arrangement with our current CEO, Mr. Nadir Ali, post-merger, under which he will continue to work with and advise the combined company to ensure its continued success, particularly during the period immediately following the closing of the transaction, will help to ease the difficulties of the transition. The Inpixon Board believes that weighing the risks and benefits, the XTI leadership team, as the successor senior management of the combined company post-merger, ultimately can provide continued success as delivered by our current senior management team.

•        Existing demand for XTI’s TriFan 600.    XTI has secured more than 700 conditional pre-orders and expressions of interest (collectively “pre-orders”) under a combination of aircraft purchase agreements, non-binding reservation deposit agreements, options and letters of intent. These pre-orders represent potential gross revenues of more than $7.0 billion, based on the current list price of $10 million per aircraft assuming the company is able to execute on the development program for the TriFan, secure FAA certification, and deliver these aircraft. For more details regarding the nature of the conditional pre-orders, please see “XTI Business — The Market” and “XTI Business — Key Agreements.” For the risks involved with the conditional pre-orders, please see “Risk Factors — The pre-orders we have received for our aircraft are non-binding, conditional or written expressions of interest and may be terminated at any time prior to execution of a definitive purchase agreement. If these pre-orders are cancelled, modified, delayed or not placed in accordance with the terms agreed with each party, our business, results of operations, liquidity and cash flow will be materially adversely affected,” “Risk Factors — The remainder of the development period for the TriFan 600 may take longer than anticipated” and “Risk Factors — We have a limited operating history and have not yet manufactured any non-prototype aircraft or delivered any aircraft to customers, and we may never develop or manufacture any VTOL aircraft.”

•        Addresses a large and growing market opportunity.    XTI services a number of diverse markets, including the business aircraft market, the helicopter market, emerging urban air mobility market, and emerging regional air mobility market, representing a total addressable market of over $1.15 trillion.

•        Historical and current market price of Inpixon common stock.    Inpixon’s management team believes that the trading price for Inpixon’s common stock has not historically recognized and does not currently recognize the full value of its business. With this transaction, Inpixon stockholders have an opportunity to retain a meaningful ownership interest in a company valued at multiples of Inpixon’s current market cap providing an opportunity for Inpixon stockholders to realize additional value for its investment.

•        Relative value received by Inpixon stockholders. The Inpixon Board and management team analyzed the terms of the proposed business combination with XTI in relation to the other opportunities available to Inpixon and concluded that the post-closing ownership ratios in the combined business would be more beneficial and would deliver more value in the business combination with XTI than in alternative opportunities whereby Inpixon’s stockholders would own significantly less than 40% of the combined company following the consummation of such transactions.

•        Fairness opinion of GVS.    The Inpixon Board considered the opinion delivered by GVS to the Inpixon Board, as of July 24, 2023, and subject to and based upon the assumptions made, procedures followed, matters considered, limitations of the review undertaken and qualifications therein, that the consideration to be received by XTI stockholders pursuant to the Merger Agreement was fair to Inpixon and its stockholders, from a financial point of view. See the section entitled “Opinion of Gemini Valuation Services, LLC.”

The Inpixon Board also considered a variety of risks and other countervailing factors related to the merger including, but not limited to the following:

•        Benefits not achieved.    The risk that the potential benefits of the transaction contemplated by the Merger Agreement may not be fully achieved or may not be achieved within the expected timeframe.

•        Closing Conditions.    The fact that completion of the transactions contemplated by the Merger Agreement are conditioned on the satisfaction of certain closing conditions that are not within Inpixon’s control.

•        Fees and Expenses.    The fees and expenses associated with completing the transactions contemplated by the Merger Agreement.

•        Other Risks.    Various other risks associated with the contemplated transaction, the business of Inpixon and the business of XTI described under the section entitled “Risk Factors.”

In addition, the Inpixon Board considered the interests that its directors and executive officers may have with respect to the merger that are different from or in addition to their interests as Inpixon Stockholders generally, as described under “The Merger-Interests of Inpixon Directors and Executive Officers in the Merger.”

Further, the merger is structured such that the stockholders of Inpixon have the opportunity to approve the issuance of shares to XTI equityholders pursuant to the terms of the merger and the change of control of Inpixon resulting from the merger. The Inpixon Board appointed Kareem Irfan, an independent director of Inpixon, as an unaffiliated representative and liaison for the independent members of the Inpixon Board and stockholders to engage with Inpixon’s management team regarding the merger. Additionally, as more fully described under “Opinion of Gemini Valuation Services,” Inpixon obtained a fairness opinion regarding the merger that evaluated the relative market values of comparable companies and valuations based on comparable transactions.

The Inpixon Board concluded that the potential benefits that it expected Inpixon and its stockholders to achieve as a result of the transactions outweighed the potentially negative factors associated with the transaction. Accordingly, the Inpixon Board determined that the Merger Agreement and the transactions contemplated by the Merger Agreement were advisable, fair to, and in the best interests of, Inpixon and its stockholders.

XTI Reasons for the Merger

For several years preceding the discussions with Inpixon, the XTI board of directors and senior management endeavoured to raise capital for the Company through a variety of sources including private capital, crowd funding and strategic partnerships. In the many months preceding discussions with Inpixon and in the course of deciding to merge with Inpixon, the XTI board of directors and senior management made numerous efforts to raise private capital for the Company with limited success. In 2021 and 2022, we thoroughly considered numerous alternatives that might be available to XTI to meet its capital requirements, with or without the Merger, including an alternative M&A transaction, SPAC mergers and an IPO. Prior to and during discussions with Inpixon, XTI sought advice from, and was advised by, a number of investment bankers on potential private and public sources of capital. We were informed by each that capital raising in the then current market environment, whether by a merger with a SPAC or an IPO, for a development stage, pre-revenue company like XTI would not be feasible given XTI’s large capital needs, long development timeline and lack of a strategic partner.

Specifically with respect to SPAC mergers since late 2021, many have brought minimal capital to their associated business combination targets. Meanwhile, we believe that the traditional IPO market has been even more challenging over the last two years. Compared to the 968 IPOs launched in the U.S. in 2021 (totaling $334.6 billion), there were only 118 IPOs launched in the U.S. in 2022 (totaling $22.9 billion raised) and only 46 IPOs so far this year (total proceeds of $13.5 billion). The traditional IPO process is costly and does not assure a successful capital raise and therefore XTI’s directors and XTI’s senior management felt that a traditional IPO was not a viable option for XTI.

In deciding to enter into the Merger with Inpixon, XTI’s directors and XTI’s senior management concluded that the Merger was the best alternative available to the Company and its stockholders. In reaching this conclusion, the Company considered a wide variety of factors and consulted with its legal counsel and financial advisors. The XTI directors considered numerous factors, including the material factors set forth below (the order in which the following factors appear does not reflect any relative importance):

•        the Merger and listed public company status will potentially expand XTI’s access to both public and private capital to support the development and certification of the TriFan 600 and the range of investors available to XTI as a listed public company, compared to the investors XTI could otherwise attract if it continued to operate without such status;

•        the potential benefits from increased public awareness of XTI and the TriFan 600;

•        the potential increase in shareholder value resulting from being a public company and having comparability with other public companies in the aviation industry;

•        the XTI board of directors’ fiduciary duties to XTI’s stockholders;

•        the opportunity to raise financing for XTI through the Merger;

•        the board of director’s belief that XTI would not be successful raising the needed capital in the current private capital market given the limited success of previous attempts at capital-raising and the large amount of capital required;

•        the board of director’s belief that there was no practical alternative to the Business Combination that could create greater value for XTI’s stockholders, after reviewing the various financing and other strategic options to enhance stockholder value;

•        the expected financial position, operations, management structure and operating plans of the combined company, including access to Inpixon management and staff with experience in public company operations;

•        the loans to be provided by Inpixon pursuant to the terms of the Merger Agreement and the Inpixon Promissory Note;

•        the business, history, operations, financial resources, assets of Inpixon;

•        the availability of appraisal rights under the DGCL to holders of XTI’s capital stock who comply with the required procedures under the DGCL;

•        the terms and conditions of the Merger Agreement, including the following:

•        the determination that the expected relative percentage ownership of Inpixon’s stockholders and XTI’s stockholders in the combined organization was appropriate, based on the XTI board of directors’ judgment and assessment of the approximate valuations of Inpixon (including the value of the net cash Inpixon is expected to provide to the combined organization) and XTI;

•        the expectation that the merger will be treated as a reorganization for U.S. federal income tax purposes, with the result that in the merger the XTI stockholders will generally not recognize taxable gain or loss for U.S. federal income tax purposes;

•        the nature of the conditions of the obligation of Inpixon to consummate the merger;

•        the rights of XTI under the Merger Agreement to consider certain unsolicited acquisition proposals under certain circumstances should XTI receive a superior proposal;

•        the conclusion of the XTI board of directors that the potential termination fees payable by Inpixon or XTI to the other party, and the circumstances when such fee may be payable, were reasonable; and

•        the belief that the other terms of the Merger Agreement, including the parties’ representations, warranties and covenants, and the conditions to their respective obligations, were reasonable in light of the entire transaction;

•        the shares of Inpixon common stock issued to XTI’s unaffiliated stockholders will be registered on a Form S-4 registration statement and will become freely tradable for such XTI’s stockholders at closing; and

•        the likelihood that the Business Combination will be consummated on a timely basis.

The XTI board of directors also considered a number of uncertainties and risks in its deliberations concerning the Business Combination and the other transactions contemplated by the Merger Agreement, including the following:

•        the possibility that the Business Combination might not be completed and the potential adverse effect of the public announcement of the Business Combination on the reputation of XTI and the ability of XTI to obtain financing in the future in the event the Business Combination` is not completed;

•        the risk that future sales of common stock by existing Inpixon security holders may cause the price of Inpixon common stock to fall, thus reducing the potential value of Inpixon common stock received by XTI stockholders as consideration and the difficulty such decline in value would have on future equity offerings;

•        the potential reduction of Inpixon’s net cash prior to the closing;

•        the risk that the Business Combination might not be consummated in a timely manner or at all;

•        the costs involved in connection with completing the Business Combination, the time and effort of XTI senior management required to complete the merger, the related disruptions or potential disruptions to XTI’s business operations and future prospects, including its relationships with its employees, suppliers and partners and others that do business or may do business in the future with XTI, and related administrative challenges associated with combining the companies;

•        the additional expenses and obligations to which XTI’s business will be subject following the merger that XTI has not previously been subject to, and the operational changes to XTI’s business, in each case that may result from being a public company;

•        the fact that the representations and warranties in the Merger Agreement do not survive the closing of the merger and the potential risk of liabilities that may arise post-closing; and

•        various other risks associated with the combined organization and the merger, including the risks described in the section entitled “Risk Factors” in this proxy statement/prospectus.

The foregoing information is not intended to be exhaustive, but summarizes the material factors considered by the XTI board of directors in its consideration of the Merger Agreement and the transactions contemplated. The XTI board of directors concluded that the benefits, advantages and opportunities of the Business Combination outweighed the uncertainties and risks described above. After considering these and other factors, the XTI board of directors unanimously approved the Merger Agreement, the Business Combination and the other transactions contemplated by the Merger Agreement.

Opinion of Gemini Valuation Services

On July 24, 2023, Gemini Valuation Services (“GVS”) rendered its opinion to the Inpixon (“INPX”) board of directors, as to, as of July 24, 2023, the fairness, from a financial point of view, of the contribution made and consideration received by the holders of Inpixon Common Stock pursuant to the Merger Agreement dated July 24, 2023.

The summary of the opinion in this proxy statement/prospectus is qualified in its entirety by reference to the full text of the written opinion, which is included as Annex B to this proxy statement/prospectus and sets forth the procedures followed, assumptions made, qualifications and limitations on the review undertaken and other matters considered by GVS in preparing its opinion. The opinion was addressed to the INPX board of directors for the use and benefit of the members of the INPX board (in their capacities as such) in connection with the INPX board’s evaluation of the Merger Agreement. Neither the opinion nor the summary of the opinion and related analyses set forth in this proxy statement/prospectus is intended to and they do not constitute advice or a recommendation to any of the shareholders of INPX or any other security holders as to how such holder should vote or act with respect to any matter relating to the transaction or otherwise. GVS’s opinion should not be construed as creating any fiduciary duty on GVS’s part to INPX, any other party to the Merger Agreement, any security holder of INPX or such other party, any creditor of INPX or such other party, or any other person. GVS’s opinion was just one of the several factors the INPX board took into account in making its determination to approve the Merger Agreement.

GVS’s opinion only addressed whether, as of the date of the opinion, the consideration received by the shareholders of INPX as part of the Merger Agreement, pursuant to the Merger Agreement was fair, from a financial point of view, to INPX shareholders. It did not address any other terms, aspects, or implications of the transaction or the Merger Agreement, including, without limitation, (i) any term or aspect of the transaction that was not susceptible to financial analysis, (iii) fairness to any other security holders of INPX, XTI Aircraft Company (“XTI”) or any other person or any creditors or other constituencies of INPX, XTI or any other person, nor (iv) the fairness of the amount or nature, or any other aspect, of any compensation or consideration payable to or received by any officers, directors, or employees of any parties to the transaction, or any class of such persons, relative to the consideration received by INPX shareholders pursuant to the Merger Agreement, or otherwise. GVS expressed no opinion as to (i) what the value of shares of INPX common stock actually would be when issued to the XTI shareholders in the Merger Agreement, (ii) the price at which shares of XTI common stock or any other security of XTI may be issued or sold in the XTI Private Placement, the price at which shares of INPX common stock or any other security of INPX may be issued or sold in the INPX private placement, or (iii) the prices at which XTI stock or INPX common stock may trade, be purchased or sold at any time.

GVS’s opinion did not address the relative merits of the transaction as compared to any alternative transaction or business strategy that might exist for INPX, or the merits of the underlying decision by the INPX board or INPX to engage in or consummate the transaction. The financial and other terms of the transaction were determined pursuant to negotiations between the parties to the Merger Agreement and were not determined by or pursuant to any recommendation from GVS.

GVS’s analyses and opinion were necessarily based upon market, economic, and other conditions as they existed on, and could be evaluated as of, the date of the opinion. Accordingly, although subsequent developments could arise that would otherwise affect its opinion, GVS did not assume any obligation to update, review, or reaffirm its opinion to the INPX board or any other person or otherwise to comment on or consider events occurring or coming to GVS’s attention after the date of its opinion.

In arriving at its opinion, GVS made such reviews, analyses, and inquiries as GVS deemed necessary and appropriate under the circumstances. Among other things, GVS:

•        Reviewed a draft copy, received by GVS on July 13, 2023, of the Merger Agreement and a final copy of the Merger Agreement, received by GVS on July 24, 2023.

•        Reviewed certain publicly available financial information and other data with respect to XTI that GVS deemed relevant.

•        Reviewed certain other information and data with respect to XTI made available to GVS by INPX, including historical financial statements for FY2019 through FY2022, and other internal financial information furnished to GVS by or on behalf of XTI.

•        Considered and compared the financial and operating performance of XTI with that of companies with publicly traded equity securities that GVS deemed relevant.

•        Considered the publicly available financial terms of certain transactions that GVS deemed relevant.

•        Discussed the business, operations, and prospects of XTI, and the proposed transaction with INPX’s management and certain of INPX’s representatives.

•        Conducted such other analyses and inquiries, and considered such other information and factors, as GVS deemed appropriate.

In arriving at its opinion, GVS, with the INPX board’s consent, relied upon and assumed, without independently verifying, the accuracy and completeness of all of the financial and other information that was supplied or otherwise made available to GVS or available from public sources, and GVS further relied upon the assurances of INPX’s and XTI’s management that they were not aware of any facts or circumstances that would make any such information inaccurate or misleading. GVS also relied upon, without independent verification, the assessments of the management of INPX as to XTI’s existing and future technology, products and services and the validity and marketability of, and risks associated with, such technology, products and services (including, without limitation, the development, testing and marketing of such technology, products and services; the receipt of all necessary governmental and other regulatory approvals for the development, testing and marketing thereof; and the life of all relevant patents and other intellectual and other property rights associated with such technology, products and services), and GVS assumed, at the INPX board’s direction, that there would be no developments with respect to any such matters that would adversely affect GVS’s analyses or opinion. GVS is not legal, tax, accounting, environmental or regulatory advisors, and GVS did not express any views or opinions as to any legal, tax, accounting, environmental or regulatory matters relating to INPX, XTI, the transaction or otherwise. GVS understood and assumed that INPX obtained or would obtain such advice as it deemed necessary or appropriate from qualified legal, tax, accounting, environmental, regulatory and other professionals.

GVS did not evaluate the solvency or creditworthiness of INPX, XTI or any other party to the transaction, or whether INPX, XTI or any other party to the transaction is paying or receiving reasonably equivalent value in the transaction under any applicable foreign, state, or federal laws relating to bankruptcy, insolvency, fraudulent transfer, or similar matters, nor did GVS evaluate, in any way, the ability of INPX, XTI or any other party to the transaction to pay its obligations when they come due. GVS did not physically inspect INPX’s or XTI’s properties or facilities and did not make or obtain any evaluations or appraisals of INPX’s or XTI’s assets or liabilities (including any contingent, derivative, or off-balance-sheet assets and liabilities). GVS did not attempt to confirm whether INPX or XTI had good title to their respective assets. GVS’s role in reviewing any information was limited solely to performing such reviews as it deemed necessary to support its own advice and analysis and was not on behalf of the INPX board, INPX, or any other party.

GVS assumed, with the INPX board’s consent, that the transaction would be consummated in a manner that complies in all respects with applicable foreign, federal, state, and local laws, rules, and regulations and that, in the course of obtaining any regulatory or third party consents, approvals, or agreements in connection with the transaction, no delay, limitation, restriction, or condition would be imposed that would have an adverse effect on INPX, XTI or the transaction. GVS also assumed, with the INPX board’s consent that the transaction would be consummated on the terms set forth in the Merger Agreement, without waiver, modification, or amendment of any term, condition, or agreement thereof material to GVS’s analyses or opinion. GVS also assumed that the representations and warranties of the parties to the Merger Agreement contained therein were true and correct and that each such party would perform all of the covenants and agreements to be performed by it under the Merger Agreement. GVS offered no opinion as to the contractual terms of the Merger Agreement or the likelihood that the conditions to the consummation of the Merger Agreement, set forth in the Merger Agreement, including, without limitation, any of the ancillary transactions, would be satisfied. GVS further assumed that for U.S. federal tax income purposes, the Merger Agreement would qualify as a reorganization within the meaning of Section 368 of the Code.

In connection with preparing its opinion, GVS performed a variety of financial analyses. The following is a summary of the material financial analyses performed by GVS in connection with the preparation of its opinion. It is not a complete description of all analyses underlying such opinion. The preparation of an opinion is a complex process involving various determinations as to the most appropriate and relevant methods of financial analysis and the application of those methods to the particular circumstances. As a consequence, neither GVS’s opinion nor the respective analyses underlying its opinion is readily susceptible to partial analysis or summary description. In arriving at its opinion, GVS assessed as a whole the results of all analyses undertaken by it with respect to the opinion. While it took into account the results of each analysis in reaching its overall conclusions, GVS did not make separate or quantifiable judgments regarding individual analyses and did not draw, in isolation, conclusions from or with regard to any individual analysis or factor. Therefore, GVS believes that the analyses underlying the opinion must be considered as a whole and that selecting portions of its analyses or the factors it considered, without considering all analyses and factors underlying the opinion collectively, could create a misleading or incomplete view of the analyses performed by GVS in preparing the opinion.

The implied multiple ranges and implied value reference ranges indicated by GVS’s analyses are not necessarily indicative of actual values nor predictive of future results, which may be significantly more or less favorable than those suggested by such analyses. Much of the information used in, and accordingly the results of, GVS’s analyses are inherently subject to substantial uncertainty.

The following summary of the material financial analyses performed by GVS in connection with the preparation of its opinion includes information presented in tabular format. The tables alone do not constitute a complete description of these analyses. Considering the data in the tables below without considering the full narrative description of the analyses, as well as the methodologies and assumptions underlying the analyses, could create a misleading or incomplete view of the financial analyses GVS performed.

For purposes of its analyses, GVS reviewed a number of financial metrics, including the following:

Equity Value — generally the value as of a specified date of the relevant company’s outstanding equity securities (taking into account its options and other outstanding convertible securities) plus the value as of such date of its net debt (the value of its outstanding indebtedness, preferred stock and minority interests less the amount of cash on its balance sheet).

Unless the context indicates otherwise, (1) share prices for the selected companies used in the selected companies analysis described below were as of July 12, 2023, (2) the relevant values for the selected transactions analysis described below were calculated on an enterprise value basis based on the consideration proposed to be paid in the selected transactions, (3) any estimates of financial performance for the selected companies listed below were based on publicly available research analyst estimates for those companies.

Selected Companies Analysis

GVS considered certain financial data for selected companies with publicly traded equity securities GVS deemed relevant with regards to XTI. The financial data reviewed included equity and enterprise value of these companies. The selected companies with publicly traded equity securities from the vertical take-off and landing (VTOL) aircraft industry were:

Joby Aviation, Inc.
Lilium N.V.
Vertical Aerospace Ltd.
Eve Holding, Inc.
EHang Holdings Limited
Archer Aviation Inc.
Blade Air Mobility, Inc.

GVS looked at the above VTOL companies that are publicly listed and are deemed to be relevant based on their business profiles and financial metrics, including product portfolios, end-markets, customers, size, growth and profitability, among others. GVS believes that the groups of companies listed above have business models similar to those of XTI but noted that none of these companies has the same management, composition, size, operations, financial profile or combination of businesses as XTI.

Source: Capital IQ. All amounts in millions, except share price.

Based on the management discussion and internal analysis of various factors including intellectual property, product lifecycle stage, historical and current evidences with regards to product development, licenses and partnerships and current business plan, XTI’s enterprise value is using the lower ranges of the equity values from the set of comparable companies. Based on this, the enterprise value for XTI is estimated between $299.3 million and 411.3 million.

Selected Transactions Analysis

GVS considered certain financial data and the financial terms of the following business transactions (a combination of reverse mergers and private placement transactions) GVS deemed relevant for XTI. The financial data reviewed included the equity values (calculated based on the consideration to be paid in the relevant transaction) and the selected transactions were:

Valuation and Invested Capital amounts in millions.

GVS looked at the above transactions in the VTOL industry that are deemed to be relevant based on their business profiles and financial metrics, including product portfolios, end-markets, customers, size, growth and profitability, among others. GVS believes that the groups of companies listed above have business models similar to those of XTI but noted that none of these companies has the same management, composition, size, operations, financial profile or combination of businesses as XTI.

Based on the management discussion and internal analysis of various factors including intellectual property, product lifecycle stage, historical and current evidences with regards to product development, licenses and partnerships and current business plan, XTI’s equity value is estimated between the median and the average equity values from the set of comparable transactions. Based on this, the enterprise value for XTI is estimated between $205.4 million and $275.6 million.

Concluded Equity Value

XTI: Based on the above determined equity value ranges for XTI and averaging the low and high ranges under each valuation method, the enterprise value for XTI is estimated to range between $253.3 million and $343.4 million.

Relative Valuation Analysis

GVS compared the above calculated equity value of XTI against the value of contribution by INPX’s shareholders to the Merger Agreement below.

As part of the Merger Agreement, INPX is offering approximately 60% of post transaction outstanding common stock to the common stockholders and debt holders of XTI while INPX shareholders will retain approximately 40% of the post transaction outstanding common stock.

Based on the above analyses, GVS noted that, the implied contribution made by the holders of INPX Common Stock is lower than the consideration received by the holders of INPX Common Stock pursuant to the Merger Agreement.

Other Matters Relating to GVS’s Opinion

The preparation of a fairness opinion is a complex analytical process involving various determinations as to the most appropriate and relevant methods of financial analysis and the application of those methods to the particular circumstances and, therefore, a fairness opinion is not readily susceptible to summary description. In arriving at its opinion, GVS did not draw, in isolation, conclusions from or with regard to any factor or analysis that it considered. Rather, GVS made its determination as to fairness on the basis of its experience and professional judgment after considering the results of all of the analyses.

The GVS opinion was one of the many factors taken into consideration by INPX’s board of directors in making its determination to approve the Merger Agreement. Consequently, the analyses as described above should not be viewed as determinative of the opinion of INPX’s board of directors with respect to the contribution made/consideration received for the shares of INPX Common Stock in the Merger Agreement or of whether INPX’s board of directors would have been willing to agree to different exchange ratio. The contribution made/consideration received for the shares of INPX Common Stock in the Merger Agreement was determined through arm’s- length negotiations between INPX and XTI and was approved by INPX’s board of directors. Neither GVS nor any of its affiliates recommended any specific exchange ratio to INPX or INPX’s board of directors or that any specific exchange ratio constituted the only appropriate exchange ratio for the Merger Agreement.

As part of its financial advisory business, GVS regularly is engaged in the evaluation of businesses and their securities in connection with mergers, acquisitions, corporate restructurings, private placements and other purposes. GVS is a recognized advisory firm that has substantial experience in providing financial advice in connection with proposed mergers, acquisitions, sales of companies, businesses and other assets and other transactions. GVS regularly undertakes valuation engagements in connection with public offerings, private placements, business combinations and similar transactions. GVS may provide financial advisory and other financial services to Inpixon and/or XTI or other participants in the merger in the future, for which GVS may receive compensation.

During the two years preceding the date of GVS’ written opinion, GVS has had a commercial and investment banking relationship with Inpixon, for which GVS has received customary compensation in the aggregate amount of $245,000. Such services during such period have included preparing the GVS fairness opinion delivered in connection with Inpixon’s sale of CXApp Holding Corp. to KINS Technology Group Inc. in March 2023, serving as valuation advisor in connection with Inpixon’s acquisition of IntraNav GmbH in December 2021, serving as valuation advisor in connection with the April 2021 settlement of the certain loan made by Inpixon to Sysorex, Inc., serving as valuation advisor in connection with Inpixon’s acquisition of Game Your Game, Inc. in March 2021, and other purchase price allocation or valuation analysis for accounting or audit purposes for a variety of Inpixon businesses.

For services rendered in connection with the delivery of its opinion, Inpixon paid GVS an investment banking fee of $80,000 in two installments: $40,000 at the signing of the engagement letter, which has been fully paid, and the balance of $40,000 paid upon the earlier of a successful transaction closing or 30 days after the signing of the engagement letter, which was also fully paid. No portion of the GVS fee is contingent upon the closing of the merger or upon the conclusions reached in its written opinion. Inpixon also agreed to reimburse GVS for its reasonable out-of-pocket expenses incurred in connection with its services, including the fees and expenses of its counsel, and will indemnify GVS against certain liabilities arising out of its engagement.

Inpixon selected GVS to render a fairness opinion in connection with the Merger based on GVS’s professional qualifications and experience providing similar services to Inpixon on competitive economic terms, as described above.

The GVS opinion does not constitute a recommendation to the Inpixon board of directors or any Inpixon stockholder as to how the Inpixon board of directors, such stockholder or any other person should vote or otherwise act with respect to the merger or any other matter, including whether or not any Inpixon stockholder should enter into any voting, support, stockholder or other agreements, arrangements or understandings in connection with the merger.

Interests of Inpixon Directors and Executive Officers in the Merger

In considering the recommendation of the Inpixon Board with respect to issuing shares of Inpixon common stock as contemplated by the Merger Agreement and the other matters to be acted upon by Inpixon stockholders at the Inpixon special meeting, Inpixon Stockholders should be aware that certain members of the Inpixon Board and certain of Inpixon’s executive officers have interests in the merger that may be different from, or in addition to, the interests of Inpixon stockholders. These interests may present them with actual or potential conflicts of interest, and these interests, to the extent material, are described below.

The Inpixon Board was aware of these potential conflicts of interest and considered them, among other matters, in reaching its decisions to approve the Merger Agreement and the merger, and to recommend, as applicable, that Inpixon stockholders approve the proposals to be presented to Inpixon stockholders for consideration at the Inpixon special meeting as contemplated by this proxy statement/prospectus.

Ownership Interests

As of October 24, 2023, Inpixon’s directors and current executive officers beneficially owned, in the aggregate less than 1% of the shares of Inpixon common stock. For more detailed information, see “Principal Stockholders of Inpixon.”

Transaction Bonus Plan

On July 24, 2023, the compensation committee of the Inpixon Board adopted a Transaction Bonus Plan (the “Plan”), which is intended to provide incentives to certain employees and other service providers to remain with Inpixon through the consummation of a Contemplated Transaction or Qualifying Transaction (each as defined below) and to maximize the value of Inpixon with respect to such transaction for the benefit of its stockholders. The Plan will be administered by the compensation committee (the “Committee”). It will automatically terminate upon the earlier of (i) the one-year anniversary of the adoption date, (ii) the completion of all payments under the terms of the Plan, or (iii) at any time by the Committee, provided, however, that the Plan may not be amended or terminated following the consummation of a Contemplated Transaction or Qualifying Transaction without the consent of each participant being affected, except as required by any applicable law.

A “Contemplated Transaction” refers to a strategic alternative transaction including an asset sale, merger, reorganization, spin-off or similar transaction (a “Strategic Transaction”) that results in a change of control as defined in the Plan. A Qualifying Transaction refers to a Strategic Transaction that does not result in a change of control for which bonuses may be paid pursuant to the Plan as approved by the Committee. The merger is expected to qualify as a Contemplated Transaction.

Pursuant to the Plan, in connection with the closing of a Contemplated Transaction or a Qualifying Transaction, the participants will be eligible to receive bonuses as described below.

•        Participants listed on Schedule 1 of the Plan including Inpixon’s named executive officers Nadir Ali, Wendy Loundermon and Soumya Das, will be eligible for a cash bonus equal to 100% of their aggregate annual base salary and target bonus amount in effect as of the closing of a Contemplated Transaction and any applicable Qualifying Transaction, as applicable, provided that the participants must execute a customary release of claims and confidentiality agreement. These bonus amounts will be paid at the closing of each applicable transaction.

•        Participants listed on Schedule 2 of the Plan including Inpixon’s named executive officers Nadir Ali and Wendy Loundermon will be eligible for a cash bonus in an aggregate amount of 4% of the applicable Transaction Value (as defined below), with Mr. Ali and Ms. Loundermon being entitled to 3.5% and 0.5% of such Transaction Value, respectively. These bonus amounts will be paid at the closing of each applicable transaction but the pro rata portion attributable to any deferred payments will be paid when those deferred payments become due, within a maximum period of five years from the closing date. “Transaction Value” means the sum of any cash and the fair market value of any securities or other assets or property received by Inpixon or available for distribution to the holders of Inpixon’s equity securities in connection with the applicable transaction as provided for in the definitive agreement governing the applicable transaction, or such value as shall be designated by the Committee.

•        Participants listed on Schedule 3 of the Plan including Inpixon’s named executive officers Nadir Ali, Wendy Loundermon and Soumya Das, may be eligible for equity-based grants, such as options or restricted stock, on such terms and upon such date as the Committee may determine.

•        In the sole discretion of the Committee, receipt or eligibility for receipt by a participant of a transaction bonus in respect of a Contemplated Transaction shall not preclude such participant from receiving or being eligible to receive an additional transaction bonus in respect of a Qualifying Transaction.

If a participant becomes entitled to any payments or benefits from the Plan or any other amounts (the “Company Payments Relating to the Plan”) that are subject to the Excise Tax, the company will pay the participant the greater of the following amounts: (i) the Company Payments Relating to the Plan, or (ii) one dollar less than the amount of the Company Payments Relating to the Plan that would subject the participant to the tax imposed by Section 4999 of the Internal Revenue Code (the “Code”) (the “Excise Tax”), as mutually agreed between the company and the participant.

The transactions contemplated by the Merger Agreement will constitute a Contemplated Transaction as defined by the Plan, under which the eligible participants of the Plan shall be entitled to a bonus. The Transaction Value as it applies to such transaction is equal to at least $225 million.

The foregoing description of the Inpixon Transaction Bonus Plan does not purport to be complete and is qualified in its entirety by the terms and conditions of the Plan, a copy of which is attached hereto as Exhibit 10.4 and is incorporated herein by reference.

Golden Parachute Compensation

This section sets forth the information required by Item 402(t) of Regulation S-K regarding the compensation that is based on or otherwise relates to the merger and that is payable or may become payable to Inpixon’s named executive officers. This compensation is referred to as “golden parachute” compensation by the applicable SEC disclosure rules.

For a narrative description of the terms and conditions applicable to the payments quantified in the table below, see “Inpixon Executive Compensation.”

Indemnification of the Inpixon Officers and Directors

The Nevada Revised Statutes provide that we may indemnify our officers and directors against losses or liabilities which arise in their corporate capacity. The effect of these provisions could be to dissuade lawsuits against our officers and directors.

The Nevada Revised Statutes Section 78.7502 provides that:

(1)    A corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, except an action by or in the right of the corporation, by reason of the fact that he is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses, including attorneys’ fees, judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with the action, suit or proceeding if he: (a) Is not liable pursuant to NRS 78.138; or (b) Acted in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction or upon a plea of nolo contendere or its equivalent, does not, of itself, create a presumption that the person is liable pursuant to NRS 78.138 or did not act in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the corporation, or that, with respect to any criminal action or proceeding, he had reasonable cause to believe that his conduct was unlawful.

(2)    A corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that he is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against expenses, including amounts paid in settlement and attorneys’ fees actually and reasonably incurred by him in connection with the defense or settlement of the action or suit if he: (a) Is not liable pursuant to NRS 78.138; or (b) Acted in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the corporation. Indemnification may not be made for any claim, issue or matter as to which such a person has been adjudged by a court of competent jurisdiction, after exhaustion of all appeals therefrom, to be liable to the corporation or for amounts paid in settlement to the corporation, unless and only to the extent that the court in which the action or suit was brought or other court of competent jurisdiction determines upon application that in view of all the circumstances of the case, the person is fairly and reasonably entitled to indemnity for such expenses as the court deems proper.

(3)    To the extent that a director, officer, employee or agent of a corporation has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in subsections 1 and 2, or in defense of any claim, issue or matter therein, the corporation shall indemnify him against expenses, including attorneys’ fees, actually and reasonably incurred by him in connection with the defense.

The Nevada Revised Statutes Section 78.751 provides that:

(1)    Any discretionary indemnification pursuant to NRS 78.7502, unless ordered by a court or advanced pursuant to Section 78.751 subsection 2; may be made by the corporation only as authorized in the specific case upon a determination that indemnification of the director, officer, employee or agent is proper in the circumstances. The determination must be made: (a) By the stockholders; (b) By the board of directors by majority vote of a quorum consisting of directors who were not parties to the action, suit or consisting of directors who were not parties to the action, suit or proceeding so orders, by independent legal counsel in a written opinion; or (c) If a quorum consisting of directors who were not parties to the action, suit or proceeding cannot be obtained, by independent legal counsel in a written opinion.

(2)    The articles of incorporation, the bylaws or an agreement made by the corporation may provide that the expenses of officers and directors incurred in defending a civil or criminal action, suit or proceeding must be paid by the corporation as they are incurred and in advance of the final disposition of the action, suit or proceeding, upon receipt of an undertaking by or on behalf of the director or officer to repay the amount if it is ultimately determined by a court of competent jurisdiction that he is not entitled to be indemnified by the corporation. The provisions of this subsection do not affect any rights to advancement of expenses to which corporate personnel other than directors or officers may be entitled under any contract or otherwise by law.

(3)    The indemnification pursuant to NRS 78.7502 and advancement of expenses authorized in or ordered by a court pursuant to this section: (a) Does not exclude any other rights to which a person seeking indemnification or advancement of expenses may be entitled under the articles of incorporation or any bylaw, agreement, vote of stockholders or disinterested directors or otherwise, for either an action in his official capacity or an action in another capacity while holding his office, except that indemnification, unless ordered by a court pursuant to NRS 78.7502 or for the advancement of expenses made pursuant to subsection 2, may not be made to or on behalf of any director or officer if a final adjudication establishes that his acts or omissions involved intentional misconduct, fraud or a knowing violation of the law and was material to the cause of action; and, (b) Continues for a person who has ceased to be a director, officer, employee or agent and inures to the benefit of the heirs, executors and administrators of such a person.

Article X of our Bylaws, as amended, provides that every person who was or is a party or is threatened to be made a party to or is involved in any action, suit, or proceeding, whether civil, criminal, administrative or investigative, by reason of the fact that he or a person of whom he is the legal representative is or was a director or officer of the Company or is or was serving at the request of the Company or for its benefit as a director or officer of another corporation, or as its representative in a partnership, joint venture, trust, or other enterprise shall be indemnified and held harmless to the fullest extent permissible by the Nevada Revised Statutes from time to time against all expenses, liability and loss (including attorneys’ fees, judgments, fines, and amounts paid or to be paid in settlement) reasonably incurred or suffered by him in connection therewith, except any expense or payments incurred in connection with any claim or liability established to have arisen out of his own willful misconduct or gross negligence.

See also the undertakings set out in response to Item 22 herein.

The Merger Agreement provides that, for a period of six years following the Effective Time of the merger, Inpixon and the combined company will indemnify each of the current and former directors and officers of Inpixon and XTI as provided in each entity’s articles/certificate of incorporation or bylaws as in effect as of the date of Merger Agreement with respect to matters occurring on or prior to the Effective Time, to the fullest extent permitted by applicable law. Prior to the Effective Time of the merger, each of Inpixon and XTI will cause the directors’ and officers’ liability insurance coverage for the respective existing directors and officers of Inpixon and XTI to be extended with the applicable premiums fully paid, in each case for a claims reporting or discovery period of at least six (6) years from and after the Effective Time with respect to any claim related to any period of time at or prior to the Effective Time.

Continued Service in the Combined Company

Soumya Das, Inpixon’s Chief Operating Officer, is expected to resign as Chief Operating Officer of Inpixon, and be appointed to serve as CEO of the indoor intelligence business. Mr. Das and Kareem Irfan, a current director of Inpixon, are expected to serve as members of the Inpixon Board following the merger.

In addition, at the Effective Time, Inpixon shall enter into consulting agreements with Mr. Ali and Ms. Loundermon, pursuant to which Mr. Ali and Ms. Loundermon will provide advisory services on an independent contractor basis to the combined company’s management based on each individual’s’ knowledge and expertise. The term of the consulting agreements will commence at the Effective Time and continue for one year, unless terminated earlier. Mr. Ali and Ms. Loundermon are expected to receive consideration for their services and be reimbursed for their non-ordinary out-of-pocket expenses reasonably incurred in connection with the services. The consulting agreements will contain non-solicitation and non-competition covenants for the term of the consulting agreement and for one year thereafter.

Form of the Merger

The Merger Agreement provides that at the Effective Time, Merger Sub will be merged with and into XTI. Upon the consummation of the merger, XTI will continue as the surviving corporation and will be a wholly-owned subsidiary of Inpixon.

After completion of the merger, Inpixon is expected to be renamed “XTI Aerospace, Inc.” and be traded on Nasdaq under the symbol “XTIA.”

Merger Consideration and Exchange Ratio

Subject to the terms and conditions of the Merger Agreement, at the Effective Time:

•        each share of XTI common stock outstanding immediately prior to the Effective Time (excluding any shares to be canceled pursuant to the Merger Agreement and shares held by holders of XTI common stock who have exercised and perfected appraisal rights or dissenters’ rights as more fully described in the section entitled “The Merger — Appraisal Rights and Dissenters’ Rights” in this proxy statement/prospectus) will automatically be converted into the right to receive a number of shares of Inpixon common stock equal to the Exchange Ratio as described below. Prior to the Effective Time, subject to obtaining the consent of requisite noteholders, all outstanding XTI convertible notes will be converted into XTI common stock and will participate in the merger on the same basis as the other shares of XTI common stock, except for the Note Amendments;

•        each option to purchase shares of XTI common stock outstanding and unexercised immediately prior to the Effective Time will be assumed by Inpixon and will become an option, subject to any applicable vesting conditions, to purchase shares of Inpixon common stock with the number of shares of Inpixon common stock underlying the unexercised portions of such options and the exercise prices for such options to be adjusted to reflect the Exchange Ratio; and

•        each warrant to purchase shares of XTI common stock outstanding and unexercised immediately prior to the Effective Time will be assumed by Inpixon and will become a warrant to purchase shares of Inpixon common stock with the number of shares of Inpixon common stock underlying such warrants and the exercise prices for such warrants will be adjusted to reflect the Exchange Ratio.

The Exchange Ratio is determined pursuant to the following formula: [((Inpixon Fully-Diluted Shares Outstanding less Inpixon Financing Adjustment Shares) divided by Adjustment Percentage) less (Inpixon Fully-Diluted Shares Outstanding less Inpixon Financing Adjustment Shares)] divided by XTI Fully-Diluted Shares Outstanding.

As used in the Exchange Ratio Formula:

•        “Adjustment Percentage” means 40% less Net Cash Adjustment Percentage less Note Adjustment Percentage.

•        “May 2023 Inpixon Warrants” means the warrants to purchase up to 150,000,000 shares of Inpixon common stock issued on May 17, 2023 (as amended on June 20, 2023), pursuant to the terms and conditions of those certain Warrant Purchase Agreements by and among Inpixon and the parties thereto (as amended on June 20, 2023).

•        “Maxim Shares” means the total number of shares of Inpixon common stock issued or issuable to Maxim Group LLC pursuant to that certain Engagement Letter dated May 16, 2023.

•        “Net Cash Adjustment Percentage” means the percentage determined pursuant to the following formula: a*(b/d), where

a = 0.4%

b = (f – c – e)

c = the principal amount of (i) any outstanding loans or advances made by Inpixon to XTI prior to the date of the Merger Agreement and (ii) any loans or advances made by Inpixon to XTI on a monthly basis up to a total amount of $1,775,000 (or such greater amount as Inpixon agrees), which total amount is outstanding as of immediately prior to the Effective Time (without duplication)

d = $1,000,000

e = Inpixon Net Cash

f = $21,500,000

•        “Note Adjustment Percentage” means the percentage determined pursuant to the following formula: g*(h/i), where

g = 0.3%

h = principal amount of, and the amount of accrued but unpaid interest on, the Streeterville Notes outstanding as of immediately prior to the Effective Time

i = $1,000,000

•        “Inpixon Financing Adjustment Shares” means the number determined pursuant to the following formula: j – k, where

j = Inpixon Financing Shares Issuable

k = Inpixon Financing Shares Issued

•        “Inpixon Financing Shares Issuable” means the total number of shares of Inpixon common stock issued or issuable pursuant to Inpixon Permitted Issuances.

•        “Inpixon Financing Shares Issued” means the total number of shares of Inpixon common stock issued pursuant to Inpixon Permitted Issuances plus shares of Inpixon common stock issuable without payment or potential payment of additional cash consideration upon conversion, exercise or exchange of derivative securities issued pursuant to Inpixon Permitted Issuances with XTI consent to the extent required pursuant to the Merger Agreement.

•        “Inpixon Fully-Diluted Shares Outstanding” means the sum of (i) the total number of shares of Inpixon common stock issued and outstanding immediately prior to the Effective Time, including Inpixon common stock issued on exercise of the May 2023 Inpixon Warrants prior to the Effective Time (for the avoidance of doubt, this clause (i) excludes shares of Inpixon common stock held in “treasury” or directly or indirectly by Inpixon), (ii) the total number of shares of Inpixon common stock issuable upon conversion of Inpixon preferred stock issued and outstanding immediately prior to the Effective Time, (iii) the total number of shares of Inpixon common stock issuable upon exercise of the Inpixon Warrants outstanding immediately prior to the Effective Time (excluding the May 2023 Inpixon Warrants to the extent not exercised prior to the Effective Time), (iv) the total number of shares of Inpixon common stock issuable upon exercise or vesting of the Inpixon Equity Awards outstanding immediately prior to the Effective Time, (v) the Maxim Shares, and (vi) shares of Inpixon common stock issued or issuable without payment or potential payment of additional cash consideration upon conversion, exercise or exchange of derivative securities issued pursuant to Inpixon Permitted Issuances.

•        “Inpixon Permitted Issuances” means the issuance by Inpixon after the date of the Merger Agreement, and prior to the Effective Time, of shares of Inpixon common stock, including pursuant to an at-the-market offering, or derivative Inpixon securities that that by their terms automatically will be converted into or exercised or exchanged for shares of Inpixon common stock prior to the Effective Time, or, if not subject to such automatic conversion, exercise or exchange, subject to prior written approval of XTI, Inpixon derivative securities issued pursuant to one or more capital raising transactions or in consideration of cancellation of indebtedness; provided, however, that Inpixon Permitted Issuances shall not include any issuance of shares of any class or series of capital stock by Inpixon that has preferential rights or privileges as to dividends, distributions, liquidation, dissolution, winding up, redemption, repurchase or any other rights that create a preference relative to the Inpixon common stock.

•        “Streeterville Notes” means those certain Promissory Notes issued to Streeterville Capital, LLC on July 22, 2022 and December 30, 2022.

•        “XTI Derivative Financing Shares Outstanding” means the total number of shares of XTI common stock issuable upon exercise, conversion or exchange of derivative securities issued pursuant to XTI Permitted Issuances with Inpixon consent to the extent required pursuant to the Merger Agreement that remain outstanding at the Effective Time.

•        “XTI Fully-Diluted Shares Outstanding” means the sum of (i) the total number of shares of XTI common stock issued and outstanding immediately prior to the Effective Time, including in respect of XTI Permitted Issuances (for the avoidance of doubt, this clause (i) excludes shares of XTI common stock held in “treasury” or directly or indirectly by XTI), (ii) the total number of shares of XTI common stock issuable upon exercise of assumed XTI warrants outstanding immediately prior to the Effective Time, (iii) the total number of shares of XTI common stock issuable upon exercise of the XTI options outstanding immediately prior to the Effective Time, and (iv) the total number of shares of XTI common stock issuable upon exercise or conversion of XTI convertible notes outstanding immediately prior to the Effective Time and (v) the XTI Derivative Financing Shares Outstanding.

•        “XTI Permitted Issuance” means any issuance by XTI after the date of the Merger Agreement, and prior to the Effective Time, of shares of XTI common stock or derivative XTI securities that by their terms automatically will be converted into or exercised or exchanged for shares of XTI common stock prior to the Effective Time or, if not subject to such automatic conversion, exercise or exchange, XTI derivative securities that have been approved by Inpixon in writing prior to issuance and which Inpixon has agreed in writing to assume at the Effective Time, pursuant to one or more capital raising transactions or in consideration of cancellation of indebtedness; provided, however, that XTI Permitted Issuances shall not include any issuance of any class or series of capital stock by XTI that has preferential rights or privileges as to dividends, distributions, liquidation, dissolution, winding up, redemption, repurchase or any other rights that create a preference relative to the XTI common stock.

Under the Merger Agreement, the Exchange Ratio will be determined in part based on the fully diluted capitalization of each of Inpixon and XTI immediately prior to the Effective Time, provided that, for this purpose the calculation of Inpixon’s fully diluted capitalization will not take into account any shares of Inpixon common stock issuable after the Effective Time for cash consideration upon conversion, exercise or exchange of securities that are permitted to be issued by Inpixon under the Merger Agreement prior to the Effective Time. Under the Merger Agreement, prior to the Effective Time, Inpixon is permitted to issue common stock or securities that are convertible into or exercisable or exchangeable for common stock, for financing or debt cancellation purposes.

The Exchange Ratio will be adjusted to the extent the amount of Inpixon’s net cash immediately prior to the Effective Time (“Inpixon Net Cash”) is greater than or less than $21,500,000 and the extent to which any debt remains outstanding under the promissory notes issued by Inpixon to Streeterville Capital, LLC on July 22, 2022 and December 30, 2022 (the “Streeterville Notes”). Inpixon will use commercially reasonable efforts to deliver Inpixon Net Cash of at least $10,000,000.

Assuming the fully diluted capitalization of Inpixon and XTI immediately prior to the Effective Time is unchanged from the same as of October 24, 2023, the Exchange Ratio is estimated to be 0.081236145 based on Inpixon and XTI’s fully diluted capitalization as of October 24, 2023, the amounts of the other elements defined in the Exchange Ratio Formula as of October 24, 2023, as well as the assumption that Inpixon will deliver an amount of net cash equal to $10 million, assuming that the Inpixon Reverse Stock Split has been implemented immediately prior to the consummation of the merger at a ratio of 1-for-50. Inpixon may effect a reverse stock split at a different ratio, subject to compliance with applicable law, and references in this proxy statement/prospectus to a 1-for-50 reverse stock split are for illustrative purposes only. The Exchange Ratio will be further adjusted if any of the assumptions described above have changed as of the effective time of the merger, including the fully diluted capitalization of the parties, Inpixon’s actual net cash as calculated and as of a time determined in accordance with the Merger Agreement, and the outstanding balance payable under the Streeterville Notes.

Immediately following the Effective Time, Inpixon stockholders as of immediately prior to the Effective Time are expected to own approximately 40% of the issued and outstanding shares of Inpixon common stock, while the XTI stockholders as of immediately prior to the Effective Time are expected to own approximately 60% of the issued and outstanding shares of Inpixon common stock, excluding the impact of additional shares of Inpixon common stock that may be issued upon the exercise or vesting, as applicable, of the combined company’s outstanding shares of preferred stock, warrants, unvested restricted stock and options including the Assumed Options, Warrants and Note.

No fractional shares of Inpixon common stock will be issued in connection with the merger. Any fractional shares of Inpixon common stock resulting from the conversion of XTI common stock into the right to receive a number of shares of Inpixon common stock equal to the Exchange Ratio pursuant to the Merger Agreement will be rounded up to the nearest whole share of Inpixon common stock.

Solutions Divestiture

Upon, prior to or around the Closing, Inpixon will effect transactions for the divestiture of its Shoom, SAVES and Game Your Game lines of business and investment securities, as applicable, by any lawful means, including a sale to one or more third parties or related parties, spin off, plan of arrangement, merger, reorganization, or any combination of the foregoing.

Grafiti Holding Spin-off and Proposed Business Combination between Grafiti Holding and Damon Motors

The following information was previously reported in Inpixon’s Current Report on Form 8-K filed with the SEC on October 23, 2023.

On October 23, 2023, as part of the Solutions Divestiture, Inpixon entered into a Separation and Distribution Agreement with Grafiti Holding Inc., a British Columbia corporation and newly formed wholly-owned subsidiary of Inpixon, pursuant to which Inpixon plans to transfer to Grafiti all of the outstanding shares of Inpixon Limited., a UK limited company that operates Inpixon’s SAVES line of business in the UK, such that Inpixon UK will become a wholly-owned subsidiary of Grafiti. Following the Reorganization and subject to conditions in the Separation Agreement, Inpixon will spin off Grafiti by distributing to Inpixon stockholders and certain securities holders as of a record date to be determined on a pro rata basis all of the outstanding common shares of Grafiti owned by Inpixon, subject to certain lock-up restrictions and subject to registration of the Grafiti Common Shares pursuant to the Securities Exchange Act, or the Securities Act.

On October 23, 2023, Inpixon entered into a Business Combination Agreement, by and among Inpixon, Damon Motors Inc., a British Columbia corporation, Grafiti, and 1444842 B.C. Ltd., a British Columbia corporation and a newly formed wholly-owned subsidiary of Grafiti, pursuant to which it is proposed that Amalco Sub and Damon amalgamate under the laws of British Columbia, Canada with the amalgamated company continuing as a wholly-owned subsidiary of Grafiti. The Damon Business Combination is subject to material conditions, including approval of the Damon Business Combination by securities holders of Damon, approval of the issuance of Grafiti Common Shares to Damon securities holders pursuant to the Damon Business Combination Agreement by a British Columbia court after a hearing upon the fairness of the terms and conditions of the Damon Business Combination Agreement as required by the exemption from registration provided by Section 3(a)(10) under the Securities Act, and approval of the listing of the Grafiti Common Shares on the Nasdaq Stock Market after giving effect to the Damon Business Combination. Upon the consummation of the Damon Business Combination, both Inpixon UK and the Damon Surviving Corporation will be wholly-owned subsidiaries of Grafiti, which will adopt a new name as determined by Damon. Grafiti, after the Damon Closing, is referred to herein as the “Grafiti combined company.” Pursuant to the Damon Business Combination Agreement, the parties will take all necessary action so that at the Damon Closing, the board of directors of the Grafiti combined company will consist of such directors as Damon may determine, subject to the independent requirements under the Nasdaq rules, and provided that at least one director will be nominated by Grafiti.

Holders of Grafiti Common Shares, including Participating Securityholders and management that hold Grafiti Common Shares immediately prior to the Damon Closing, are anticipated to retain approximately 18.75% of the outstanding capital stock of the Grafiti combined company determined on a fully diluted basis, which includes up to 5% in equity incentives which may be issued to Inpixon management.

Inpixon expects that there will be no public trading market for the Grafiti Common Shares unless the Damon Business Combination is consummated.

No securities of Inpixon will be issued in connection with the Damon Business Combination.

Regulatory Approvals

In the United States, Inpixon must comply with applicable federal and state securities laws and the rules and regulations of Nasdaq in connection with the issuance of shares of Inpixon common stock and the filing of this proxy statement/prospectus with the SEC.

Notice to XTI Stockholders of Adoption of Merger Agreement by Written Consent

The adoption of the Merger Agreement by XTI’s stockholders required the affirmative vote or written consent by holders of a majority of the issued and outstanding shares of XTI common stock entitled to vote thereon. Following the execution of the Merger Agreement, on July 24, 2023, the David E Brody 2019 Spousal Trust and the Jason S Brody 2019

Trust (collectively, the “Majority Stockholders”), which together on such date beneficially owned 23,450,000 shares of XTI common stock (excluding any warrants held by such stockholders) representing approximately 67.4% of the outstanding shares of XTI common stock, delivered a written consent approving and adopting in all respects the Merger Agreement (the “Written Consent”).

As a result, no further action by any other stockholder of XTI is required under applicable law or the Merger Agreement (or otherwise) to adopt the Merger Agreement, and XTI is not, and will not be, soliciting votes for or consent to the adoption of the Merger Agreement and the approval of the transactions contemplated thereby and will not call a stockholders’ meeting for purposes of voting on the adoption of the Merger Agreement and the approval of the transactions contemplated thereby.

This Registration Statement on Form S-4, including this notice of Written Consent, will be mailed to the stockholders of XTI who have not consented in writing to the actions set forth in the Written Consent and who, if the actions had been taken at a meeting, would have been entitled to notice of the meeting if the record date for notice of such meeting had been July 24, 2023, the date the executed Written Consent was delivered to the Company to adopt and approve the Merger Agreement, at their address of record on the books and records of XTI.

You are not being asked for a proxy, and you are requested not to send a proxy.

Material U.S. Federal Income Tax Consequences of the Merger

The following is a discussion of the material U.S. federal income tax consequences of the merger to U.S. Holders (as defined below) who exchange their XTI common stock for Inpixon common stock in the merger or that exercise dissenters’ rights. The discussion does not purport to be a complete analysis of all potential tax effects to such a U.S. Holder. The effects of other U.S. federal tax laws, such as estate and gift tax laws and any withholding considerations under the Foreign Account Tax Compliance Act of 2010 (including the Treasury Regulations issued thereunder and intergovernmental agreements entered into pursuant thereto or in connection therewith), and any applicable state, local or non-U.S. tax laws are not addressed in this discussion. This discussion is based on the Code, Treasury Regulations promulgated thereunder, judicial decisions, and published rulings and administrative pronouncements of the IRS, in each case in effect as of the date hereof. These authorities may change or be subject to differing interpretations. Any such change or differing interpretation may be applied retroactively in a manner that could adversely affect a U.S. Holder. This discussion assumes that the merger will be consummated in accordance with the Merger Agreement and as described in this proxy statement/prospectus.

This discussion is limited to U.S. Holders that hold XTI common stock as a “capital asset” within the meaning of Section 1221 of the Code (generally, property held for investment). This discussion does not address all U.S. federal income tax consequences relevant to a U.S. Holder’s particular circumstances, including the impact of the alternative minimum tax or the Medicare contribution tax on net investment income. In addition, it does not address consequences relevant to U.S. Holders subject to special rules, including, without limitation:

•        U.S. expatriates and former citizens or long-term residents of the United States;

•        U.S. Holders whose functional currency is not the U.S. dollar;

•        persons holding XTI common stock as part of a hedge, straddle or other risk reduction strategy or as part of a conversion transaction or other integrated investment;

•        banks, insurance companies, and other financial institutions;

•        real estate investment trusts or regulated investment companies;

•        brokers, dealers or traders in securities;

•        “controlled foreign corporations,” “passive foreign investment companies,” and corporations that accumulate earnings to avoid U.S. federal income tax;

•        S corporations, partnerships or other entities or arrangements treated as partnerships for U.S. federal income tax purposes (and investors therein);

•        persons for whom XTI common stock constitutes “qualified small business stock” within the meaning of Section 1202 of the Code or as “Section 1244 stock” for purposes of Section 1244 of the Code;

•        tax-exempt organizations or governmental organizations;

•        persons subject to special tax accounting rules as a result of any item of gross income with respect to XTI common stock being taken into account in an “applicable financial statement” (as defined in the Code);

•        persons deemed to sell XTI common stock under the constructive sale provisions of the Code;

•        persons who hold or received XTI common stock pursuant to the exercise of any employee stock option or otherwise as compensation; and

•        tax-qualified retirement plans.

If an entity treated as a partnership for U.S. federal income tax purposes holds XTI common stock, the tax treatment of a partner in the partnership will depend on the status of the partner, the activities of the partnership and certain determinations made at the partner level. Accordingly, partnerships holding XTI common stock and the partners in such partnerships should consult their own tax advisors regarding the U.S. federal income tax consequences to them of the merger.

For purposes of this discussion, a U.S. Holder is a beneficial owner of XTI common stock that, for U.S. federal income tax purposes, is:

•        an individual who is a citizen or resident of the United States;

•        a corporation, or entity treated as a corporation, created or organized under the laws of the United States, any state thereof, or the District of Columbia;

•        an estate, the income of which is subject to U.S. federal income tax regardless of its source; or

•        a trust that (i) is subject to the primary supervision of a U.S. court and the control of one or more “United States persons” (within the meaning of Section 7701(a)(30) of the Code) over all of its substantial decisions or (ii) that was in existence on August 20, 1996 and has a valid election in effect to be treated as a United States person for U.S. federal income tax purposes.

Holders of XTI common stock who are not U.S. Holders may have different tax consequences than those described below and are urged to consult their own tax advisors regarding the particular tax consequences of the merger to them under U.S. federal income tax laws and the tax laws of any applicable state, local or non-U.S. taxing jurisdiction.

IN ADDITION, IT IS RECOMMENDED THAT ALL HOLDERS CONSULT THEIR OWN TAX ADVISORS WITH RESPECT TO THE APPLICATION OF THE U.S. FEDERAL INCOME TAX LAWS TO THEIR PARTICULAR SITUATIONS AS WELL AS ANY TAX CONSEQUENCES OF THE MERGER ARISING UNDER THE U.S. FEDERAL ESTATE OR GIFT TAX LAWS OR UNDER THE LAWS OF ANY STATE, LOCAL OR NON-U.S. TAXING JURISDICTION OR UNDER ANY APPLICABLE INCOME TAX TREATY.

U.S. Federal Income Tax Consequences of the Merger Generally

Inpixon and XTI each intends and expects the merger to qualify as a “reorganization” within the meaning of Section 368(a) of the Code. However, Inpixon and XTI cannot guarantee that the Internal Revenue Service will not challenge the intended tax treatment of the merger, and that such a challenge will not be successful. Inpixon and XTI have not sought, and do not intend to seek, any ruling from any governmental authority, including the Internal Revenue Service, regarding the U.S. federal income tax consequences of the merger, and as a result, there can be no assurance that the Internal Revenue Service will not assert, or that a court would not sustain, any positions contrary to any of the conclusions described herein. If the Internal Revenue Service were to successfully challenge the “reorganization” status of the merger, the tax consequences of the merger could differ from those set forth in this proxy statement/prospectus and a U.S. Holder could be subject to U.S. federal income tax with respect to its receipt of Inpixon common stock in the merger. You should consult your own tax advisor as to the specific tax consequences to you in light of your specific circumstances in the event the merger does not qualify as a “reorganization” within the meaning of Section 368(a) of the Code. The following discussion assumes that the merger will qualify as a “reorganization” within the meaning of Section 368(a) of the Code.

Tax Consequences to U.S. Holders that Exchange XTI Common Stock for Inpixon Common Stock

If you are a U.S. Holder who exchanges XTI common stock for Inpixon common stock in the merger, the U.S. federal income tax consequences of the merger to you generally will be as follows:

•        a U.S. Holder of shares of XTI common stock will not recognize any gain or loss upon the exchange of such shares for shares of Inpixon common stock in the merger;

•        a U.S. Holder of shares of XTI common stock will have a tax basis in the shares of Inpixon common stock received in the merger equal to the tax basis of the shares of XTI common stock surrendered in exchange therefor;

•        a U.S. Holder of shares of XTI common stock will have a holding period for the shares of Inpixon common stock received in the merger that includes its holding period for its shares of XTI common stock surrendered in exchange therefor; and

•        if a U.S. Holder of shares of XTI common stock acquired different blocks of shares of XTI common stock at different times or at different prices, the shares of Inpixon common stock received in the merger will be allocated pro rata to each block of shares of XTI common stock, and the basis and holding period of such shares of Inpixon common stock will be determined on a block-for-block approach depending on the basis and holding period of each block of shares of XTI common stock exchanged for such shares of Inpixon common stock.

If you acquired different blocks of shares of XTI common stock at different times or at different prices, you should consult your own tax advisor regarding the manner in which your basis and holding period should be allocated among your Inpixon common stock in light of your specific circumstances.

U.S. Holders Exercising Dissenters’ Rights

If a U.S. Holder of XTI common stock exercises dissenters’ rights, the U.S. Holder would exchange all of its XTI common stock for cash. A U.S. Holder that receives only cash in exchange for its XTI common stock generally would recognize gain or loss equal to the difference between the amount of cash received and such U.S. Holder’s adjusted tax basis in its XTI common stock. Except as described below, this gain or loss generally would be capital gain or loss and would be long-term capital gain or loss if the U.S. Holder’s holding period for its shares of XTI common stock at the time of the exchange exceeds one year.

In some cases, if a U.S. Holder of XTI common stock actually or constructively owns shares of Inpixon common stock (other than Inpixon common stock received as consideration in connection with the merger), the U.S. Holder’s gain, if any, that is recognized as a result of exercising dissenters’ rights could be treated as having the effect of the distribution of a dividend under the tests set forth in Section 302 of the Code, in which case such gain would be treated as dividend income to the extent of the U.S. Holder’s ratable share of Inpixon’s accumulated earnings and profits (as calculated for U.S. federal income tax purposes). The determination of whether a U.S. Holder will recognize a capital gain or dividend income is complex, depends upon the specific factual circumstances particular to each U.S. Holder, including the application of various constructive ownership rules, and must be determined on a shareholder-by-shareholder basis. Accordingly, each U.S. Holder should consult its own tax advisor as to the tax consequences of the foregoing rules in light of its particular circumstances.

Information Reporting and Backup Withholding

Current Treasury Regulations require certain U.S. Holders who are “significant holders” of XTI common stock to comply with certain reporting requirements in connection with a merger that qualifies as a “reorganization” within the meaning of Section 368(a) of the Code. Under Treasury Regulation Section 1.368-3, a significant holder includes a person who transfers stock of a target corporation and receives stock of an acquirer in a reorganization transaction if, immediately before the exchange, such person owned at least one percent (by vote or value) of the total outstanding stock of the target corporation (which is not publicly traded). The statement must include, among other things, the significant holder’s tax basis and fair market value of the XTI common stock surrendered in the merger (determined immediately before the merger), the date of the merger, and the name and employer identification number of each party to the merger. U.S. Holders should consult their own tax advisors to determine whether they are required to provide the foregoing statement.

In addition, a U.S. Holder may be subject to information reporting and backup withholding when such holder receives cash as a result of exercising dissenters’ rights. Certain U.S. Holders are exempt from backup withholding, including corporations and certain tax-exempt organizations. A U.S. Holder will be subject to backup withholding if such holder is not otherwise exempt and:

•        the holder fails to furnish the holder’s taxpayer identification number, which for an individual is ordinarily his or her social security number;

•        the holder furnishes an incorrect taxpayer identification number;

•        the applicable withholding agent is notified by the IRS that the holder previously failed to properly report payments of interest or dividends; or

•        the holder fails to certify under penalties of perjury that the holder has furnished a correct taxpayer identification number and that the IRS has not notified the holder that the holder is subject to backup withholding.

Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules may be allowed as a refund or a credit against a U.S. Holder’s U.S. federal income tax liability, provided the required information is timely furnished to the IRS. U.S. Holders should consult their own tax advisors regarding their qualification for an exemption from backup withholding and the procedures for obtaining such an exemption.

The U.S. federal income tax consequences of the merger to a U.S. Holder are complex and will depend on such U.S. Holder’s own tax situation. Accordingly, each U.S. Holder is urged to consult its own tax advisor with respect to the specific tax consequences of the merger to it, taking into account its own circumstances.

Nasdaq Listing

Inpixon common stock currently is listed on Nasdaq under the symbol “INPX.” Inpixon has agreed to use commercially reasonable efforts to (i) maintain its existing listing on Nasdaq until the Effective Time, (ii) to prepare and submit a Nasdaq notification form for the listing of the shares of Inpixon common stock to be issued in connection with the merger, and to cause such shares to be approved for listing (subject to official notice of issuance), and (iii) to file an initial listing application for the combined company’s common stock on Nasdaq and to cause such application to be approved prior to the Effective Time. In addition, under the Merger Agreement, each party’s obligation to complete the merger is subject to the satisfaction or waiver by each of the parties prior to the Closing of various conditions, including that the existing shares of Inpixon common stock must have been continually listed on Nasdaq, and Inpixon must have caused the shares of Inpixon common stock to be issued in the merger to be approved for listing on Nasdaq as of the closing.

Inpixon has filed an initial listing application for the combined company’s common stock with Nasdaq pursuant to Nasdaq “business combination” rules. If such this application is accepted, Inpixon anticipates that the shares of Inpixon common stock will be listed on Nasdaq following the closing under the trading symbol “XTIA.” In order to meet the requirements for listing on Nasdaq, the combined company will be required to satisfy Nasdaq’s initial listing requirements, including the financial and liquidity requirements for the applicable Nasdaq market tier upon which the combined company’s shares will trade following the merger. Certain Nasdaq market tiers and standards require companies seeking to list to demonstrate a minimum “Market Value of Unrestricted Publicly Held Shares” as of the effective time of the closing of a business combination. Per current Nasdaq rules and requirements, the “Market Value of Unrestricted Publicly Held Shares” may not include the value of any securities subject to resale restrictions under Rule 144.

Anticipated Accounting Treatment

The Merger is anticipated to be accounted for using the acquisition method (as a reverse acquisition) in accordance with GAAP. Although Inpixon is the legal acquirer and will issue shares of its common stock to effect the merger with XTI, XTI is considered the accounting acquirer. Under this method of accounting, Inpixon will be treated as the “acquired” company for financial reporting purposes. XTI has been determined to be the accounting acquirer because XTI maintains control of the Board of Directors and management of the combined company. For accounting purposes, the acquirer is the entity that has obtained control of another entity and, thus, consummated a business combination. Under the acquisition method of accounting (as a reverse acquisition), Legacy XTI’s assets and liabilities will be recorded at carrying value and the assets and liabilities associated with Inpixon will be recorded at estimated fair value as of the acquisition date. The excess of the purchase price over the estimated fair values of the net assets acquired, if applicable will be recognized as goodwill. Determination of fair value of certain assets acquired

is dependent upon certain valuations that have yet to commence or progress to a stage where there is sufficient information for a definitive measurement. A final determination of these estimated fair values, which cannot be made prior to the completion of the transaction, will be based on the actual net tangible assets of Inpixon that exist as of the date of the completion of the transaction. Therefore, the actual purchase price allocation may differ from the amounts reflected in the unaudited pro forma condensed combined financial statements. The unaudited pro forma condensed consolidated financial statements include the accounts of Inpixon since the effective date of merger and XTI since inception.

Appraisal Rights and Dissenters’ Rights

Dissenters’ Rights of Inpixon Stockholders

Holders of Inpixon common stock are not entitled to rights of dissent or appraisal rights under the Nevada Revised Statutes in connection with the Business Combination or the other Proposals.

Appraisal Rights of XTI Stockholders

XTI stockholders are entitled to appraisal rights in connection with the Merger under Section 262 of the DGCL.

The discussion below is not a complete summary regarding XTI stockholders’ appraisal rights under Delaware law and is qualified in its entirety by reference to the text of the relevant provisions of Delaware law, which are attached as Annex C. Stockholders intending to exercise appraisal rights should carefully review Annex C. Failure to follow precisely any of the statutory procedures set forth in Annex C may result in a termination or waiver of these rights. In the event of any inconsistency between the information contained in this summary, and the actual text of Section 262 of the DGCL, the actual text of Section 262 of the DGCL controls. All references in Section 262 and in this summary to a “stockholder” are to the record holder of shares of XTI capital stock unless otherwise expressly noted herein, and all such references to a “beneficial owner” mean a person who is the beneficial owner of shares of XTI capital stock held either in voting trust or by a nominee on behalf of such person unless otherwise expressly noted herein. This summary does not constitute legal or other advice, nor does it constitute a recommendation that XTI stockholders exercise their appraisal rights under Delaware law.

Under Section 262, where a merger is adopted by stockholders by written consent in lieu of a meeting of stockholders pursuant to Section 228 of the DGCL, either the constituent corporation before the effective date of such merger or the surviving corporation, within ten days after the effective date of such merger, must notify each stockholder of the constituent corporation entitled to appraisal rights of the approval of such merger, the effective date of such merger and that appraisal rights are available. XTI’s stockholders adopted the merger by Written Consent on July 24, 2023. For more information, see the section entitled “Notice to XTI Stockholders of Adoption of Merger Agreement by Consent in Lieu of a Meeting” in this proxy statement/prospectus.

Following stockholder approval of the Merger, and no later than 10 days after the effective date of the Merger, XTI will notify its stockholders entitled thereto that the Merger has been approved and that appraisal rights are available to any stockholder who is entitled to exercise appraisal rights, including by not having delivered the Written Consent to the adoption of the Merger Agreement. Such notice may, and, if given on or after the effective date of the Merger, shall, also notify such stockholders of the effective date of the Merger. If such notice did not notify stockholders of the effective date of the Merger, XTI will send a second notice notifying each of the stockholders of XTI that are entitled to appraisal rights of the effective date of the Merger either before the effective date of the Merger or on or within 10 days after such effective date; provided, however, that if such second notice is sent more than 20 days following the sending of the first notice, such second notice need only be sent to each stockholder who is entitled to appraisal rights and who has demanded appraisal of such holder’s shares in accordance with Section 262(d)(2) of the DGCL and any beneficial owner who has demanded appraisal under Section 262(d)(3) of the DGCL. Holders of record or beneficial owners of shares of XTI capital stock who desire to exercise their appraisal rights must deliver a written demand for appraisal to XTI within 20 days after the date of the giving of this notice of appraisal rights, and that the shares subject to such appraisal demand must not have been voted, including by written consent, in favor of the Merger and adopting the Merger Agreement. A demand for appraisal must reasonably inform XTI of the identity of the stockholder or the beneficial owner and that such stockholder or beneficial owner intends thereby to demand appraisal of the shares of XTI capital stock held by such stockholder or beneficial owner. In addition, in the case of a demand for appraisal made by a beneficial owner, the demand must (1) reasonably identify the holder of record of the shares

Costs of the appraisal proceeding may be determined by the Delaware Court and taxed upon the parties as the Delaware Court deems equitable in the circumstances. However, costs do not include attorneys’ and expert witness fees. Upon the application of a person whose name appears on the verified list who participated in the proceeding and incurred expenses in connection therewith, the Delaware Court may order all or a portion of the expenses, including, without limitation, reasonable attorneys’ fees and the fees and expenses of experts, to be charged pro rata against the value of all shares entitled to appraisal that were not dismissed or subject to an award pursuant to a reservation of jurisdiction pursuant to subsection (k) of Section 262. In the absence of such a determination or assessment, each party bears its own expenses. Any person who has demanded appraisal rights will not, after the effective time, be entitled to vote shares subject to that demand for any purpose or to receive payments of dividends or any other distribution with respect to those shares, other than with respect to payment to stockholders of record of XTI as of a record date prior to the effective time.

To the extent there are any inconsistencies between the foregoing summary, on the one hand, and Section 262, on the other hand, Section 262 will govern.

Failure to follow the steps required by Section 262 for perfecting appraisal rights will result in the loss of appraisal rights. In view of the complexity of Section 262, persons who may wish to exercise appraisal rights, or preserve their right to do so, should consult their legal advisors.

Please review the information in the sections entitled “The Merger Agreement” on page 103, “Opinion of Gemini Valuation Services” on page 81 and refer to the sections herein describing the business and/or financials of XTI and Inpixon.

Ratification of Prior Corporate Acts of XTI

The XTI Board of Directors determined that it was advisable and in the best interests of XTI and its stockholders to ratify certain corporate actions pursuant to Section 204 of the DGCL in order to cure technical defects in the manner in which such corporate actions were adopted or filed under Delaware law. There are no claims or controversies with respect to the ratified actions and no further action is required by or requested of any XTI stockholder. Under Section 204 of the DGCL, a statutory process exists by which a Delaware corporation can ratify defective corporate acts, retroactive to the date the act was originally taken, if the procedures of Section 204 of the DGCL are followed. No further action by the stockholders of XTI is required under Delaware law in connection with such ratification.

On December 30, 2014, XTI’s Board of Directors adopted resolutions approving an increase to the number of authorized shares of XTI common stock from 100,000 to 100,000,000 shares (the “Amendment”), intending for such increase to become effective on December 31, 2014; however, such increase was not effected pursuant to a duly approved and adopted amendment in accordance with Section 242 of the DGCL, including because a Certificate of Amendment setting forth the Amendment was not filed with the Delaware Secretary of State and because stockholder approval of the Amendment may not have been obtained. On November 10, 2015, XTI filed a Certificate of Validation (the “Prior Validation”) with the Delaware Secretary of State in respect of the Amendment and the issuance of 35,769,565 shares of XTI common stock; however, the ratification of the defective corporate acts for which the filing of the Prior Validation was required may not have been duly approved and adopted in accordance with Section 204 of the DGCL, including because board and stockholder approval thereof was obtained pursuant to a joint consent. Such joint format may not have complied with Sections 141 and 228 of the DGCL and such ratification may not have been approved first by the board and second by the stockholders, as required by Section 204 of the DGCL. As a result, XTI may have issued shares of common stock in excess of the number of shares of common stock that XTI had the power to issue under Section 161 of the DGCL and XTI’s Certificate of Incorporation at the time of such issuances. With respect to shares issued after December 30, 2014, such shares were issued in uncertificated form; however, XTI’s Board of Directors did not provide for the issuance of such shares as uncertificated shares, as required by Section 158 of the DGCL and Section 6.1 of XTI’s Bylaws, and XTI did not give the record holders of such shares the notice described in Section 151(f) of the DGCL. Such shares were registered in electronic form with XTI’s transfer agent at the time. In 2017, XTI replaced its initial transfer agent with ComputerShare which became the exclusive registrar and transfer agent for its common stock. ComputerShare is a global computer service bureau that provides electronic share registry and transfer agent services to corporations. XTI’s Board of Directors also ratified these issuances of uncertificated stock pursuant to Section 204 on July 23, 2023. Moreover, certain of the uncertificated shares were subsequently transferred, and following such transfers, XTI failed to provide the notice described in Section 151(f) of the DGCL.

The defective corporate acts described in the foregoing paragraph were ratified pursuant to Section 204 of the DGCL by XTI’s Board of Directors on October 2, 2023 and the requisite stockholders approved such ratification by written consent in lieu of a meeting on October 2, 2023. Such ratification requires the filing of a Certificate of Correction and a Certificate of Validation with the Delaware Secretary of State.

XTI will be mailing a notice pursuant to Sections 204(g) and 228(e) in respect of the foregoing matters and such notice will include copies of the resolutions adopted by XTI’s Board of Directors pursuant to Section 204 of the DGCL. Any claim that the defective corporate acts (including all putative stock) identified in such resolutions are void or voidable due to the failures of authorization, or any claim that the Court of Chancery of the State of Delaware should declare in its discretion that the ratification not be effective or be effective only on certain conditions, must be brought within 120 days from the date on which such notice is given.

Legal Proceedings Relating to the Merger

On August 21, 2023, a purported Inpixon shareholder filed a lawsuit in the United States District Court for the Northern District of California against Inpixon and its directors. Another shareholder filed a substantially similar suit in the same court against the same parties on August 24, 2023. The cases are styled Busby v. Inpixon, Case No. 3:23-cv-04249 (N.D. Cal.) and Panovski v. Inpixon, Case No. 4:23-cv-04330-KAW (N.D. Cal.). Both suits allege that Inpixon filed a purportedly misleading Form S-4 on August 14, 2023 that omits material information regarding the process leading to the Business Combination and the analysis performed by Inpixon’s financial advisor in connection with the merger. The suits assert claims under Section 14(a) and Section 20 of the Securities Exchange Act and seek injunctive relief, damages, costs, attorneys’ fees, and other relief. Inpixon has also received demand letters from multiple purported Inpixon shareholders alleging that the Form S-4 omits or misstates material information regarding similar topics as alleged in the lawsuits, as well as material information pertaining to other topics, including information pertaining to the compensation and business or financial relationships of Inpixon’s financial advisor for the proposed transaction. The letters demand that Inpixon make supplemental disclosures to correct the alleged misstatements and omissions. It is possible that Inpixon may be named in additional suits or receive additional demand letters containing similar allegations or asserting additional allegations or claims regarding the Business Combination.

THE MERGER AGREEMENT

The following is a summary of the material terms of the Merger Agreement. A copy of the Merger Agreement is attached as Annex A to this proxy statement/prospectus and is incorporated by reference into this proxy statement/prospectus. The Merger Agreement has been attached to this proxy statement/prospectus to provide you with information regarding its terms. It is not intended to provide any other factual information about Inpixon, XTI or Merger Sub. The following description does not purport to be complete and is qualified in its entirety by reference to the Merger Agreement. You should refer to the full text of the Merger Agreement for details of the merger and the terms and conditions of the Merger Agreement.

The Merger Agreement contains representations and warranties that Inpixon and Merger Sub, on the one hand, and XTI, on the other hand, have made to one another as of specific dates. These representations and warranties have been made for the benefit of the other parties to the Merger Agreement and may be intended not as statements of fact but rather as a way of allocating the risk to one of the parties if those statements prove to be incorrect. In addition, the assertions embodied in the representations and warranties are qualified by information in confidential disclosure schedules exchanged by the parties in connection with signing the Merger Agreement. While Inpixon and XTI do not believe that these disclosure schedules contain information required to be publicly disclosed under the applicable securities laws, other than information that has already been so disclosed, the disclosure schedules do contain information that modifies, qualifies and creates exceptions to the representations and warranties set forth in the attached Merger Agreement. Accordingly, you should not rely on the representations and warranties as current characterizations of factual information about Inpixon and XTI, because they were made as of specific dates, may be intended merely as a risk allocation mechanism between Inpixon, Merger Sub and XTI and are modified by the disclosure schedules.

General

Under the Merger Agreement, at the Effective Time, Merger Sub will merge with and into XTI, with XTI surviving as a wholly-owned subsidiary of Inpixon.

Merger Consideration and Exchange Ratio

Subject to the terms and conditions of the Merger Agreement, at the Effective Time:

•        each share of XTI common stock outstanding immediately prior to the Effective Time (excluding any shares to be canceled pursuant to the Merger Agreement and shares held by holders of XTI common stock who have exercised and perfected appraisal rights or dissenters’ rights as more fully described in the section entitled “The Merger — Appraisal Rights and Dissenters’ Rights” in this proxy statement/prospectus) will automatically be converted into the right to receive a number of shares of Inpixon common stock equal to the Exchange Ratio as described below. Prior to the Effective Time, subject to obtaining the consent of requisite noteholders, all outstanding XTI convertible notes will be converted into XTI common stock and will participate in the merger on the same basis as the other shares of XTI common stock, except for the Note Amendments;

•        each option to purchase shares of XTI common stock outstanding and unexercised immediately prior to the Effective Time will be assumed by Inpixon and will become an option, subject to any applicable vesting conditions, to purchase shares of Inpixon common stock with the number of shares of Inpixon common stock underlying the unexercised portions of such options and the exercise prices for such options to be adjusted to reflect the Exchange Ratio; and

•        each warrant to purchase shares of XTI common stock outstanding and unexercised immediately prior to the Effective Time will be assumed by Inpixon and will become a warrant to purchase shares of Inpixon common stock with the number of shares of Inpixon common stock underlying such warrants and the exercise prices for such warrants will be adjusted to reflect the Exchange Ratio.

The Exchange Ratio is determined pursuant to the following formula: [((Inpixon Fully-Diluted Shares Outstanding less Inpixon Financing Adjustment Shares) divided by Adjustment Percentage) less (Inpixon Fully-Diluted Shares Outstanding less Inpixon Financing Adjustment Shares)] divided by XTI Fully-Diluted Shares Outstanding.

As used in the Exchange Ratio Formula:

•        “Adjustment Percentage” means 40% less Net Cash Adjustment Percentage less Note Adjustment Percentage.

•        “May 2023 Inpixon Warrants” means the warrants to purchase up to 150,000,000 shares of Inpixon common stock issued on May 17, 2023 (as amended on June 20, 2023), pursuant to the terms and conditions of those certain Warrant Purchase Agreements by and among Inpixon and the parties thereto (as amended on June 20, 2023).

•        “Maxim Shares” means the total number of shares of Inpixon common stock issued or issuable to Maxim Group LLC pursuant to that certain Engagement Letter dated May 16, 2023.

•        “Net Cash Adjustment Percentage” means the percentage determined pursuant to the following formula: a*(b/d), where

a = 0.4%

b = (f – c – e)

c = the principal amount of (i) any outstanding loans or advances made by Inpixon to XTI prior to the date of the Merger Agreement and (ii) any loans or advances made by Inpixon to XTI on a monthly basis up to a total amount of $1,775,000 (or such greater amount as Inpixon agrees), which total amount is outstanding as of immediately prior to the Effective Time (without duplication)

d = $1,000,000

e = Inpixon Net Cash

f = $21,500,000

•        “Note Adjustment Percentage” means the percentage determined pursuant to the following formula: g*(h/i), where

g = 0.3%

h = principal amount of, and the amount of accrued but unpaid interest on, the Streeterville Notes outstanding as of immediately prior to the Effective Time

i = $1,000,000

•        “Inpixon Financing Adjustment Shares” means the number determined pursuant to the following formula: j – k, where

j = Inpixon Financing Shares Issuable

k = Inpixon Financing Shares Issued

•        “Inpixon Financing Shares Issuable” means the total number of shares of Inpixon common stock issued or issuable pursuant to Inpixon Permitted Issuances.

•        “Inpixon Financing Shares Issued” means the total number of shares of Inpixon common stock issued pursuant to Inpixon Permitted Issuances plus shares of Inpixon common stock issuable without payment or potential payment of additional cash consideration upon conversion, exercise or exchange of derivative securities issued pursuant to Inpixon Permitted Issuances with XTI consent to the extent required pursuant to the Merger Agreement.

•        “Inpixon Fully-Diluted Shares Outstanding” means the sum of (i) the total number of shares of Inpixon common stock issued and outstanding immediately prior to the Effective Time, including Inpixon common stock issued on exercise of the May 2023 Inpixon Warrants prior to the Effective Time (for the avoidance of doubt, this clause (i) excludes shares of Inpixon common stock held in “treasury” or directly or indirectly

by Inpixon), (ii) the total number of shares of Inpixon common stock issuable upon conversion of Inpixon preferred stock issued and outstanding immediately prior to the Effective Time, (iii) the total number of shares of Inpixon common stock issuable upon exercise of the Inpixon Warrants outstanding immediately prior to the Effective Time (excluding the May 2023 Inpixon Warrants to the extent not exercised prior to the Effective Time), (iv) the total number of shares of Inpixon common stock issuable upon exercise or vesting of the Inpixon Equity Awards outstanding immediately prior to the Effective Time, (v) the Maxim Shares, and (vi) shares of Inpixon common stock issued or issuable without payment or potential payment of additional cash consideration upon conversion, exercise or exchange of derivative securities issued pursuant to Inpixon Permitted Issuances.

•        “Inpixon Permitted Issuances” means the issuance by Inpixon after the date of the Merger Agreement, and prior to the Effective Time, of shares of Inpixon common stock, including pursuant to an at-the-market offering, or derivative Inpixon securities that that by their terms automatically will be converted into or exercised or exchanged for shares of Inpixon common stock prior to the Effective Time, or, if not subject to such automatic conversion, exercise or exchange, subject to prior written approval of XTI, Inpixon derivative securities issued pursuant to one or more capital raising transactions or in consideration of cancellation of indebtedness; provided, however, that Inpixon Permitted Issuances shall not include any issuance of shares of any class or series of capital stock by Inpixon that has preferential rights or privileges as to dividends, distributions, liquidation, dissolution, winding up, redemption, repurchase or any other rights that create a preference relative to the Inpixon common stock.

•        “Streeterville Notes” means those certain Promissory Notes issued to Streeterville Capital, LLC on July 22, 2022 and December 30, 2022.

•        “XTI Derivative Financing Shares Outstanding” means the total number of shares of XTI common stock issuable upon exercise, conversion or exchange of derivative securities issued pursuant to XTI Permitted Issuances with Inpixon consent to the extent required pursuant to the Merger Agreement that remain outstanding at the Effective Time.

•        “XTI Fully-Diluted Shares Outstanding” means the sum of (i) the total number of shares of XTI common stock issued and outstanding immediately prior to the Effective Time, including in respect of XTI Permitted Issuances (for the avoidance of doubt, this clause (i) excludes shares of XTI common stock held in “treasury” or directly or indirectly by XTI), (ii) the total number of shares of XTI common stock issuable upon exercise of assumed XTI warrants outstanding immediately prior to the Effective Time, (iii) the total number of shares of XTI common stock issuable upon exercise of the XTI options outstanding immediately prior to the Effective Time, and (iv) the total number of shares of XTI common stock issuable upon exercise or conversion of XTI convertible notes outstanding immediately prior to the Effective Time and (v) the XTI Derivative Financing Shares Outstanding.

•        “XTI Permitted Issuance” means any issuance by XTI after the date of the Merger Agreement, and prior to the Effective Time, of shares of XTI common stock or derivative XTI securities that by their terms automatically will be converted into or exercised or exchanged for shares of XTI common stock prior to the Effective Time or, if not subject to such automatic conversion, exercise or exchange, XTI derivative securities that have been approved by Inpixon in writing prior to issuance and which Inpixon has agreed in writing to assume at the Effective Time, pursuant to one or more capital raising transactions or in consideration of cancellation of indebtedness; provided, however, that XTI Permitted Issuances shall not include any issuance of any class or series of capital stock by XTI that has preferential rights or privileges as to dividends, distributions, liquidation, dissolution, winding up, redemption, repurchase or any other rights that create a preference relative to the XTI common stock.

Subject to adjustment pursuant to the formula for the Exchange Ratio set forth in Exhibit A of the Merger Agreement, the Exchange Ratio will be determined based on the fully diluted capitalization of each of Inpixon and XTI immediately prior to the Effective Time, provided, however, that for this purpose the calculation of Inpixon’s fully diluted capitalization will not take into account any shares of Inpixon common stock issuable after Closing for cash consideration upon conversion, exercise or exchange of derivative securities that are issued by Inpixon in Inpixon Permitted Issuances. “Inpixon Permitted Issuances” are any issuances of common stock or derivative securities by Inpixon for financing or debt cancellation purposes that are permitted under the Merger Agreement and occur after the date of the Merger Agreement but before the Closing.

Assuming the fully diluted capitalization of Inpixon and XTI immediately prior to the Effective Time is unchanged from the same as of October 24, 2023, if Inpixon Net Cash is $10,000,000, the Exchange Ratio would be 0.081236145, and assuming the amount of principal and interest outstanding under the Streeterville Notes is $10,380,000 and the Inpixon Reverse Stock Split is effected immediately prior to the merger at a ratio of 1-for-50. Inpixon may effect a reverse stock split at a different ratio, subject to compliance with applicable law, and references in this proxy statement/prospectus to a 1-for-50 reverse stock split are for illustrative purposes only.

After application of the Exchange Ratio and subject to those certain adjustments described above, Inpixon stockholders immediately prior to the Effective Time will retain approximately 40% of the issued and outstanding capital stock of the combined company and XTI stockholders immediately prior to the Effective Time will retain approximately 60% of the issued and outstanding capital stock of the combined company.

Treatment of Inpixon Equity Awards and Warrants

Inpixon Options and Unvested Restricted Stock

All shares of unvested restricted stock and options to purchase Inpixon common stock outstanding immediately prior to the Effective Time shall remain unaffected by the merger and shall, at the Effective Time, continue to remain outstanding in accordance with the respective terms and conditions as were applicable to each such shares of Inpixon restricted stock and options as set forth in the applicable stock incentive plan and/or other documents evidencing such securities, in each case, immediately prior to the Effective Time.

The number of shares of Inpixon common stock underlying the unvested Inpixon restricted stock and options and the exercise prices for such options will be appropriately adjusted to reflect any Inpixon Reverse Stock Split.

Inpixon Warrants

All warrants to purchase Inpixon common stock outstanding immediately prior to the Effective Time shall remain unaffected by the merger and shall, at the Effective Time, continue to remain outstanding in accordance with the terms and conditions as were applicable to each such warrants as set forth in the applicable warrant agreements and/or other documents evidencing such securities, immediately prior to the Effective Time.

The number of shares of Inpixon common stock underlying the warrants and the exercise prices for such warrants will be appropriately adjusted to reflect any Inpixon Reverse Stock Split.

Each of the holders of the Inpixon January 2019 Warrants (34 shares of common stock are issuable upon the exercise of such warrants at an exercise price of $11,238.75 per share) and August 2019 Warrants (73 shares of common stock are issuable upon the exercise of warrants at an exercise price of $936.5625 per share), each subject to adjustment in proportion to the Inpixon Reverse Stock Split, may, concurrently with, or within 30 days after, the consummation of the merger, require Inpixon to purchase these warrants from the holder by paying to the holder an amount of cash equal to the Black Scholes Value of the remaining unexercised portion of the warrants on the date of the consummation of the merger.

Treatment of XTI Options, Warrants and Convertible Notes

XTI Options

At the Effective Time, each option to purchase shares of XTI common stock outstanding immediately prior to the Effective Time, whether or not vested, will be converted into an option to purchase shares of Inpixon common stock. From and after the Effective Time, each XTI option assumed by Inpixon may be exercised for such number of shares of Inpixon common stock as is determined by multiplying the number of shares of XTI common stock subject to the option by the Exchange Ratio and rounding that result down to the nearest whole number of shares of Inpixon common stock. The per share exercise price of the converted option will be determined by dividing the existing per share exercise price of the option by the Exchange Ratio and rounding that result up to the nearest whole cent. Any restrictions on the exercise of any XTI option assumed by Inpixon will continue following the conversion and the term, exercisability, vesting schedules and other provisions of assumed XTI options will generally remain unchanged; provided, that any XTI options assumed by Inpixon may be subject to adjustment to reflect definitional changes in the

applicable terms of the XTI options to reference Inpixon or Inpixon common stock, changes in Inpixon’s capitalization or other similar corporate events that relate to Inpixon or Inpixon common stock after the Effective Time and that the Inpixon Board will succeed to the authority of the XTI Board with respect to each assumed XTI option.

XTI Warrants

At the Effective Time, each warrant to purchase shares of XTI common stock outstanding immediately prior to the Effective Time will be converted into a warrant to purchase shares of Inpixon common stock. From and after the Effective Time, each XTI warrant assumed by Inpixon may be exercised for such number of shares of Inpixon common stock as is determined by multiplying the number of shares of XTI common stock subject to the warrant by the Exchange Ratio and rounding that result down to the nearest whole number of shares of Inpixon common stock. The per share exercise price of the converted warrant will be determined by dividing the existing per share exercise price of the warrant by the Exchange Ratio and rounding that result up to the nearest whole cent. The term, exercisability, and other provisions of assumed XTI warrants will generally remain unchanged; provided, that any XTI warrants assumed by Inpixon may be subject to adjustment to reflect definitional changes in the applicable terms of the XTI warrants to reference Inpixon or Inpixon common stock, changes in Inpixon’s capitalization or other similar corporate events that relate to Inpixon or Inpixon common stock after the Effective Time.

XTI Convertible Notes

Prior to the Effective Time, subject to obtaining the consent of the requisite noteholders, all XTI convertible notes outstanding as of the Closing Date shall be converted into shares of XTI common stock, except for that certain promissory note of XTI, dated April 1, 2023, in the initial principal amount of $1,817,980, which shall have been amended to provide for, upon the Effective Time, the extension of the maturity date to December 31, 2026 and the convertibility of the outstanding principal and interest into Inpixon common stock, and that certain promissory note of XTI held by David Brody, dated December 31, 2021, in the initial principal amount of $1,007,323, which will provide for, at Closing, payment in cash of $507,323 of the principal plus interest accrued to the date of payment, and the conversion of the remaining $500,000 of outstanding principal into Inpixon common stock.

Directors and Officers of Inpixon Following the Merger

Pursuant to the Merger Agreement, each of the current directors and officers of Inpixon who will not continue as directors or officers of Inpixon or the combined company following the consummation of the merger, shall resign effective upon the Closing. Following the Closing, the Inpixon Board is expected to be comprised of five directors. Two of the five directors will have been nominated by Inpixon prior to the Closing, and at least one of which will be an independent director. It is anticipated that Soumya Das and Kareem Irfan will remain as directors of Inpixon following the Closing, and that all other current Inpixon directors will resign as of the Effective Time. Scott Pomeroy is expected to be appointed to the board as Chair of the board of directors. It is anticipated that Scott Pomeroy, David Brody, and one director to be later designated will be appointed to the board of the combined company as designees of XTI. It is anticipated that Inpixon’s executive officers upon the Closing will be Scott Pomeroy as Chief Executive Officer, Brooke Martellaro as Chief Financial Officer, Mara Babin as General Counsel, Soumya Das as Chief Executive Officer of the RTLS Division, and Michael Hinderberger will serve as Chief Executive Officer of XTI Aircraft Company.

Conditions to the Completion of the Merger

Each party’s obligation to complete the merger is subject to the satisfaction or waiver by each of the parties, at or prior to the Closing, of various conditions, which include the following:

•        obtaining the “required XTI stockholder approval,” whereby the holders of a majority of the outstanding shares of XTI common stock must have adopted and approved the Merger Agreement and the transactions contemplated by the Merger Agreement;

•        obtaining the “required Inpixon stockholder approval,” whereby the holders of Inpixon common stock representing the requisite affirmative vote of the holders of all shares of Inpixon common stock present virtually or by proxy at the Inpixon special meeting and entitled to thereon must have approved the Nasdaq Stock Issuance Proposal, which relates to the issuance of shares of Inpixon common stock on the terms and subject to the conditions of the Merger Agreement (the “Inpixon Stock Issuance”);

•        no order, injunction, statute, rule, regulation or decree shall have been issued, enacted, entered, promulgated or enforced by a governmental entity that prohibits, precludes, restrains, enjoins or makes illegal the consummation of the merger or the Inpixon Stock Issuance;

•        the registration statement on Form S-4, of which this proxy statement/prospectus is a part, must have been declared effective by the SEC under the Securities Act and must not be subject to any stop order or proceeding, or any proceeding threatened by the SEC, seeking a stop order that has not been withdrawn; and

•        the approval of the listing of shares to be issued pursuant to the Merger Agreement of Inpixon common stock on Nasdaq must have been obtained, and Inpixon must have caused the shares of the combined company’s common stock to be approved for initial listing on Nasdaq (subject to official notice of issuance) as of the Closing.

For purpose of the Merger Agreement, “XTI Material Adverse Effect” means (i) a material adverse effect on the business, results of operations, financial condition or assets of XTI, or (ii) a material adverse effect on XTI’s ability to consummate the transactions contemplated in the Merger Agreement; provided, however, that in no event shall any of the following, alone or in combination, be deemed to constitute an XTI Material Adverse Effect, or be taken into account in determining whether an XTI Material Adverse Effect has occurred: (A) any adverse change, effect, event or occurrence, state of facts or developments as a result of the public announcement or the pendency of the Merger Agreement or the transactions contemplated hereby or any actions required to be taken (or refrained from being taken) in compliance herewith, including any action taken (or omitted to be taken) with the written consent of or at the written request of either Inpixon or Merger Sub, (B) any change in federal, state, non-U.S. or local law, regulations, policies or procedures, or interpretations thereof, GAAP, or regulatory accounting requirements applicable or potentially applicable to the industries in which XTI operates, (C) changes generally affecting the industries in which XTI operates that are not specifically related to XTI and do not have a materially disproportionate adverse effect on XTI, (D) changes in general economic conditions or political conditions, or in the financial, credit or securities markets in general (including changes in the prevailing interest rates, exchange rates or stock, bond and/or debt prices) in the United States, in any region thereof, or in any non-U.S. or global economy that do not have a materially disproportionate adverse effect on XTI, (E) any attack on, or by, outbreak or escalation of hostilities or acts of terrorism (including cyberterrorism) involving, the United States, or any declaration of war by the United States Congress or any hurricane or other natural disaster, or epidemics, pandemics or public health emergencies (as declared by the World Health Organization or the Health and Human Services Secretary of the United States), (F) any failure to meet financial projections, estimates or forecasts for any period (provided, however, that the underlying cause of such failure may, to the extent applicable, be considered in determining whether there has been an XTI Material Adverse Effect), (G) the taking of any action by Inpixon, Merger Sub or any of their respective affiliates (including any breach of the Merger Agreement committed thereby), or (H) any matter set forth in XTI’s disclosure schedule.

For purpose of the Merger Agreement, “Inpixon Material Adverse Effect” means (i) a material adverse effect on the business, results of operations, financial condition or assets of Inpixon and its subsidiaries taken as a whole, or (ii) a material adverse effect on Inpixon’s or Merger Sub’s ability to consummate the transactions contemplated hereby; provided, however, that in no event shall any of the following, alone or in combination, be deemed to constitute an Inpixon Material Adverse Effect, or be taken into account in determining whether an Inpixon Material Adverse Effect has occurred: (A) any adverse change, effect, event or occurrence, state of facts or developments as a result of the public announcement or the pendency of the Merger Agreement or the transactions contemplated hereby or any actions required to be taken (or refrained from being taken) in compliance herewith, including any action taken (or omitted to be taken) with the written consent of or at the written request of XTI, (B) any change in federal, state, non-U.S. or local law, regulations, policies or procedures, or interpretations thereof, GAAP or regulatory accounting requirements applicable or potentially applicable to the industries in which Inpixon or its subsidiaries operate, (C) changes generally affecting the industries in which Inpixon or its subsidiaries operate that are not specifically related to Inpixon and its subsidiaries and do not have a materially disproportionate adverse effect on Inpixon and its subsidiaries, taken as a whole, (D) changes in general economic conditions or political conditions, or in the financial, credit or securities markets in general (including changes in the prevailing interest rates, exchange rates or stock, bond and/or debt prices) in the United States, in any region thereof, or in any non-U.S. or global economy that do not have a materially disproportionate adverse effect on Inpixon and its subsidiaries, taken as a whole, (E) any attack on, or by, outbreak or escalation of hostilities or acts of terrorism (including cyberterrorism) involving, the United States, or any declaration of war by the United States Congress or any hurricane or other natural disaster, or epidemics, pandemics or public health emergencies (as declared by the World Health Organization or the Health and Human Services Secretary of the

United States), (F) any failure to meet financial projections, estimates or forecasts for any period (provided, however, that the underlying cause of such failure may, to the extent applicable, be considered in determining whether there has been an Inpixon Material Adverse Effect), (G) the taking of any action by XTI or any of its affiliates (including any breach of the Merger Agreement committed thereby), (H) any matter set forth in Inpixon’s disclosure schedule; (I) changes in the market price or trading volume of the Inpixon common stock on Nasdaq (it being understood that this does not and shall not be deemed to apply to the underlying cause or causes of any such changes), and (J) any adverse change in Inpixon’s and its subsidiaries’, taken as a whole, financial results that is not materially worse than Inpixon’s historical negative financial results and historical negative trends either (x) reflected in Inpixon’s 2022 annual financial statements included in its annual report on Form 10-K for the year ended December 31, 2022 filed with the SEC on April 17, 2023 (the “2022 Inpixon Annual Report”), in Inpixon’s quarterly report on Form 10-Q for the quarter ended March 31, 2023 filed with the SEC on May 16, 2023 and Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2023 filed with the SEC on August 18, 2023 (the “2023 Inpixon Interim Reports”), or Inpixon’s current report on Form 8-K filed with the SEC on July 25, 2023 (the “July 2023 Current Report”) (y) discussed in the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the 2022 Inpixon Annual Report or the 2023 Inpixon Interim Reports.

In addition, the obligation of Inpixon and Merger Sub to complete the merger is further subject to the satisfaction or waiver of the following conditions:

•        the representations and warranties of XTI shall be true and correct in all material respects on the date of the Merger Agreement and on the Closing Date with the same force and effect except for (i) those representations and warranties that address matters only as of a particular date, which shall be true and correct in all respects as of that date and (ii) any failure or failures of such representations and warranties to be so true and correct (without giving effect to any qualifications or limitations as to materiality), individually or in the aggregate, have not resulted in or would reasonable be expected to result in a XTI Material Adverse Effect, and Inpixon shall have received a certificate signed on behalf of XTI by its Chief Executive Officer to such effect;

•        XTI shall have performed in all material respects all obligations required to be performed by it under the Merger Agreement at or prior to the Closing Date, and Inpixon shall have received a certificate signed on behalf of XTI by its Chief Executive Officer to such effect;

•        since the date of the Merger Agreement, there shall not have been any XTI Material Adverse Effect or any event, change, or effect that would, individually or in the aggregate, reasonably be expected to have an XTI Material Adverse Effect;

•        the 20-day period during which appraisal must be demanded as contemplated by Section 262(d)(2) of the DGCL shall have concluded and no greater than 5% of the issued and outstanding shares of XTI common stock shall be dissenting shares;

•        the required XTI stockholder approval shall have been obtained by a written consent of XTI’s stockholders (the “XTI Stockholder Consent”) within 24 hours after the execution and delivery of the Merger Agreement and Inpixon shall have received a certificate signed on behalf of XTI by its Chief Executive Officer as to the obtainment of the required XTI stockholder approval;

•        the promissory note of XTI, dated April 1, 2023, in the initial principal amount of $1,817,980 (the “April 1, 2023 Note”), shall have been amended to extend the maturity date thereof until no sooner than December 31, 2026, and such that, upon the Effective Time, it will become convertible into Inpixon common stock, pursuant to such form of amendment as is reasonably acceptable to Inpixon;

•        XTI, Inpixon and their respective successors, assigns and affiliates shall have received an unconditional full release of certain claims against XTI and its affiliates in form and substance acceptable to Inpixon and XTI;

•        XTI shall use commercially reasonable efforts to amend, in form and substance reasonably acceptable to Inpixon, any XTI warrant that, as of the date of this Agreement, requires cash payment to the applicable warrant holder by XTI or its successor as a result of a fundamental transaction such as a merger or reorganization, including the warrants held by Startengine Crowdfunding, Inc., to eliminate such cash payment obligation, and cause such XTI warrants to become assumed XTI warrants; and

•        XTI and Chardan Capital Markets LLC (or its applicable affiliate) shall have amended their fee agreement in form and substance reasonably acceptable to Parent.

In addition, the obligation of XTI to complete the merger is further subject to the satisfaction or waiver of the following conditions:

•        the representations and warranties of Inpixon and Merger Sub shall be true and correct in all material respects on the date of the Merger Agreement and on the Closing Date with the same force and effect except for (i) those representations and warranties that address matters only as of a particular date, which shall be true and correct in all respects as of that date and (ii) any failure or failures of such representations and warranties to be so true and correct (without giving effect to any qualifications or limitations as to materiality), individually or in the aggregate, have not resulted in or would reasonable be expected to result in an Inpixon Material Adverse Effect, and XTI shall have received a certificate signed on behalf of Inpixon by its Chief Executive Officer to such effect;

•        each of Inpixon and Merger Sub shall have performed in all material respects all obligations required to be performed by it under the Merger Agreement at or prior to the Closing Date, and XTI shall have received a certificate signed on behalf of Inpixon by its Chief Executive Officer to such effect;

•        since the date of the Merger Agreement, there shall not have been any Inpixon Material Adverse Effect or any event, change, or effect that would, individually or in the aggregate, reasonably be expected to have an Inpixon Material Adverse Effect; and

•        with respect to the Streeterville Notes, Inpixon shall have obtained (i) a waiver from Streeterville such that consummation of the Merger in accordance with the Merger Agreement will not constitute a Change of Control (as defined in the Streeterville Notes) under any of the Streeterville Notes; and (ii) approval by Streeterville of the assumption by Inpixon of the April 1, 2023 Note, as amended in accordance with Section 8.2(f) of the Merger Agreement, upon the Effective Time.

Representations and Warranties

The Merger Agreement contains customary representations and warranties of Inpixon and XTI for a transaction of this type relating to, among other things:

•        corporate organization, power and similar corporate matters;

•        capitalization;

•        authority to enter into the Merger Agreement and the related agreements;

•        no violations of each party’s agreements as a result of the merger or the Merger Agreement;

•        votes required for completion of the merger and approval of the proposals that will come before the Inpixon stockholder special meeting and that will be the subject of the XTI Stockholder Consent;

•        except as otherwise specifically disclosed pursuant to in the Merger Agreement, the fact that the consummation of the merger would not contravene or require the consent of any third-party;

•        financial statements

•        SEC filings;

•        any brokerage or finder’s fee or other fee or commission in connection with the merger;

•        absence of certain changes or events;

•        legal proceedings;

•        taxes;

•        employee benefit plans;

•        compliance with applicable law;

•        the existence of and validity of material contracts to which the parties or their subsidiaries are a party and any violation, default or breach to such material contracts;

•        undisclosed liabilities;

•        ownership of real property and leasehold interests;

•        title to property;

•        insurance;

•        environmental liability;

•        intellectual property;

•        labor matters;

•        transactions with affiliates;

•        accuracy and lack of omission of disclosures in this proxy statement/prospectus;

•        with respect to Inpixon and Merger Sub, no business activities by Merger Sub;

•        with respect to Inpixon and Merger Sub, no ownership of XTI common stock or other agreements with XTI’s directors or officers relating to the merger; and

•        with respect to Inpixon and Merger Sub, sufficiency of assets.

The representations and warranties are, in many respects, qualified by materiality, knowledge and XTI Material Adverse Effect and Inpixon Material Adverse Effect, as applicable, and will not survive the merger, but their accuracy forms the basis of one of the conditions to the obligations of Inpixon and XTI to complete the merger.

No Solicitation

Each of Inpixon and XTI agreed that during the period commencing on the date of the Merger Agreement and ending on the earlier of the Effective Time or the termination of the Merger Agreement, except as described below, Inpixon and XTI will not, nor will either party authorize its respective subsidiaries, officers, directors, employees, affiliates, agents and representatives to, directly or indirectly:

•        negotiate, authorize, recommend, enter into or propose to enter into any acquisition agreement, business combination, merger agreement or similar definitive agreement, or any letter of intent, memorandum of understanding or agreement in principle, or any other agreement relating to an Acquisition Proposal (as defined below) (each, an “Alternative Acquisition Agreement”);

•        continue to engage in discussions with any third party concerning any Acquisition Proposal;

•        encourage, solicit or initiate discussions, negotiations or submissions of proposals, indications of interest or offers in respect of an Acquisition Proposal; or

•        furnish or cause to be furnished to any person any information in furtherance of an Acquisition Proposal.

An “Acquisition Proposal” means an inquiry, proposal or offer from, or indication of interest in making a proposal or offer by, any person or group relating to any transaction or series of related transactions (other than the transactions contemplated by the Merger Agreement), involving any:

•        direct or indirect acquisition of assets (including any voting equity interests of any subsidiaries, but excluding sales of assets in the ordinary course of business) of XTI and its subsidiary (taken as a whole) or Inpixon and its subsidiaries (taken as a whole), as applicable, equal to 20% or more of the fair market value of XTI’s or Inpixon’s and its subsidiaries’ (taken as a whole), as applicable, consolidated assets or to which 20% or more of XTI’s and its subsidiaries’ (taken as a whole) or Inpixon’s and its subsidiaries’ (taken as a whole), as applicable, net revenues or net income on a consolidated basis are attributable;

•        direct or indirect acquisition of 20% or more of the voting equity interests of XTI or Inpixon, as applicable, or any of XTI’s or Inpixon’s, as applicable, subsidiaries whose business constitutes 20% or more of the consolidated net revenues, net income or assets of XTI and its subsidiary (taken as a whole) or Inpixon and its subsidiaries (taken as a whole), as applicable;

•        tender offer or exchange offer that if consummated would result in any person or group (as defined in Section 13(d) of the Exchange Act) beneficially owning (within the meaning of Section 13(d) of the Exchange Act) 20% or more of the voting power of XTI or Inpixon, as applicable, or any of XTI’s or Inpixon’s, as applicable, subsidiaries whose business constitutes 20% or more of the consolidated net revenues, net income or assets of XTI and its subsidiary (taken as a whole) or Inpixon and its subsidiaries (taken as a whole), as applicable;

•        merger, consolidation, other business combination or similar transaction involving XTI or its subsidiary or Inpixon or any of its subsidiaries, as applicable, pursuant to which such person or group (as defined in Section 13(d) of the Exchange Act) would own 20% or more of the consolidated net revenues, net income or assets of XTI and its subsidiary (taken as a whole) or Inpixon and its subsidiaries (taken as a whole), as applicable;

•        liquidation, dissolution (or the adoption of a plan of liquidation or dissolution), recapitalization or other significant corporate reorganization of XTI or Inpixon, as applicable, or one or more of XTI’s or Inpixon’s, as applicable, subsidiaries which, individually or in the aggregate, generate or constitute 20% or more of the consolidated net revenues, net income or assets of XTI and its subsidiary (taken as a whole) or Inpixon and its subsidiaries (taken as a whole), as applicable; or

•        any combination of the foregoing.

Notwithstanding the foregoing, before obtaining the applicable approvals of the stockholders of XTI or Inpixon required to consummate the merger, as applicable, each party may furnish non-public information regarding such party and its subsidiaries to, and may enter into discussions or negotiations with, any third-party in response to a bona fide acquisition proposal made or received after the date of the Merger Agreement, which such party’s board of directors determines in good faith, after consultation with such party’s financial advisors and outside legal counsel, constitutes or is reasonably likely to result in a “Superior Proposal,” as defined below, if:

•        the Acquisition Proposal was not solicited, initiated, encouraged, facilitated or otherwise obtained in breach, in any material respect, of the non-solicitation provisions of the Merger Agreement described above;

•        such party’s board of directors determines in good faith after consultation with its financial advisor and outside legal counsel that such Acquisition Proposal constitutes or could reasonably be expected to lead to a Superior Proposal;

•        such party receives from the third party an executed confidentiality agreement containing provisions as to the treatment of confidential information that are no less favorable in any material respect to the disclosing party than those contained in the confidentiality agreement between Inpixon and XTI (except for such changes necessary for disclosing party to comply with its obligations under the Merger Agreement);

•        such party promptly (and in any event, within 48 hours) furnishes any non-public information provided to the third-party to the other party to the extent not previously furnished; and

•        such party promptly (and in any event, within 48 hours) notifies the other party of its board of directors’ determination.

A “Superior Proposal” means a bona fide written Acquisition Proposal with respect to XTI and its subsidiary (taken as a whole) or Inpixon or its subsidiaries (taken as a whole), as applicable, except that, for purposes of this definition, each reference in the definition of “Acquisition Proposal” to “20%” shall be “50%”, that the XTI Board or the Inpixon Board, as applicable, determines in good faith (after consultation with its outside legal counsel and financial advisor) is more favorable from a financial point of view to the holders of the XTI common stock or the Inpixon common stock, as applicable, than the transactions contemplated by the Merger Agreement, taking into account: (A) all financial considerations; (B) the identity of the third party making such Acquisition Proposal; (C) the anticipated timing, conditions (including any financing condition or the reliability of any debt or equity funding

commitments) and prospects for completion of such Acquisition Proposal; (D) the other terms and conditions of such Acquisition Proposal and the implications thereof on XTI and its subsidiary (taken as a whole) or Inpixon and its subsidiaries (taken as a whole), as applicable, including relevant legal, regulatory and other aspects of such Acquisition Proposal deemed relevant by the XTI Board or the Inpixon Board, as applicable; and (E) any revisions to the terms of the Merger Agreement and the merger proposed by XTI or Inpixon, as applicable, during the notice period described above.

Changes in Board Recommendation

As described above, and subject to the provisions described below, (i) the Inpixon Board recommends that Inpixon Stockholders vote “FOR” all of the proposals described in this proxy statement/prospectus/information and (ii) the XTI Board recommends that XTI Stockholders execute the written consent to approve the merger, the Merger Agreement, and the transactions contemplated therein, substantially in accordance with the terms of the Merger Agreement and the other agreements contemplated by the Merger Agreement.

Except as described below, prior to the Effective Time of the merger or the termination of the Merger Agreement pursuant to its terms, neither the Inpixon Board nor the XTI Board may (i) withdraw or modify the board of directors’ recommendation to Inpixon stockholders (the “Inpixon Recommendation”) or XTI stockholders (the “XTI Recommendation”), as applicable, (ii) submit any Acquisition Proposal to the vote of the Inpixon stockholders or XTI stockholders, as applicable, (iii) fail to include the board of directors’ recommendation in the XTI Board’s solicitation of stockholder written consent or this proxy statement/prospectus, as applicable, (iv) adopt, approve or recommend any Acquisition Proposal, (v) following the initial public announcement of any Acquisition Proposal (other than by the commencement of a tender offer or exchange offer), fail to issue a public press release within 10 business days of such public announcement that the board of directors recommends rejection of such Acquisition Proposal and affirms the Inpixon Recommendation or XTI Recommendation, as applicable, or (vi) following the initial public announcement of any Acquisition Proposal that is structured as a tender offer or exchange offer by a third party for equity securities, fail to recommend against acceptance by the stockholders of such tender offer or exchange offer within 10 business days of commencement of such tender offer or exchange offer, or (vii) publicly announce its intention, authorize or resolve to take, or that it will fail to take, as applicable, any such foregoing actions (any of the foregoing, a “change in recommendation”).

Notwithstanding the restrictions described above, the Merger Agreement provides that, prior to obtaining the required XTI stockholder approval or the required Inpixon stockholder approval, as applicable, the XTI Board or the Inpixon Board, as applicable, may make a change in recommendation in response to a written Acquisition Proposal that such board of directors have determined, in good faith, after consultation with its outside legal counsel and financial advisors, to be a Superior Proposal (provided that such Acquisition Proposal did not arise out of a material breach of the non-solicitation provisions described above).

Each of XTI and Inpixon shall promptly (any in any event, within 48 hours) notify the other party in writing if, from the date of the Merger Agreement, any Acquisition Proposal, or any inquiry, expression of interest, proposal, offer or request for information that would reasonably be expected to result in an Acquisition Proposal, is received by it or any of its representatives, indicating (except to the extent prohibited by applicable law) the identity of the person making such Acquisition Proposal and a description of the material terms and conditions of any such inquiry, expression of interest, proposal, offer or request for information or Acquisition Proposal, and thereafter shall keep the other party reasonably informed of the status and terms of any such Acquisition Proposal.

Meetings of Inpixon Stockholders; Consent of XTI Stockholders

Following the registration statement on Form S-4, of which this proxy statement/prospectus is a part, being declared effective by the SEC, Inpixon is obligated to call, give notice of and hold the Inpixon special meeting for the purposes of considering the approval of, among the other items noted herein, the Inpixon Stock Issuance, and any other proposal that Inpixon and XTI reasonably deem necessary or desirable to consummate the transactions contemplated under the Merger Agreement.

XTI is obligated under the Merger Agreement to obtain written consents of its stockholders sufficient to adopt the Merger Agreement thereby approving the merger and related transactions within 24 hours after the execution of the Merger Agreement. The required XTI stockholder approval by the XTI Stockholder Consent has been obtained.

Covenants; Conduct of Business Pending the Merger

Except as expressly required, contemplated or permitted by the Merger Agreement, as required by law, rule or regulation, during the period commencing on the date of the Merger Agreement and continuing until the earlier to occur of the Effective Time and the termination of the Merger Agreement, each of Inpixon and XTI will, and will cause their respective subsidiaries to, conduct its business and operations in the ordinary course and use commercially reasonable efforts to maintain and preserve substantially intact its business organization and the goodwill of those having business or other third-party relationships with it, including any governmental entity, and retain the services of its present officers and key employees.

Inpixon and XTI have also agreed that, except for certain actions expressly permitted in the Merger Agreement and for certain limited exceptions, without the consent of the other party, it will not, nor shall it cause or permit subsidiaries to, during the period commencing on the date of the Merger Agreement and continuing until the earlier to occur of the Closing and the termination of the Merger Agreement:

•        adjust, split, combine or reclassify its capital stock;

•        set any record or payment dates for the payment of any dividends or distributions on its capital stock or make, declare or pay any dividend or make any other distribution on any shares of its capital stock or any securities or obligations convertible into or exchangeable for any shares of its capital stock, except that the wholly-owned subsidiary may declare and pay dividends to its parent and other wholly-owned subsidiaries;

•        directly or indirectly redeem, purchase or otherwise acquire, any shares of its capital stock or any securities or obligations convertible into or exchangeable for any shares of its capital stock, except pursuant to the exercise or vesting any outstanding equity awards as of the date of the Merger Agreement or permitted to be issued thereafter, or the surrender or withholding of shares to cover tax withholding obligations or to pay any applicable exercise price under Inpixon or XTI’s equity incentive plans;

•        grant any stock appreciation rights or grant any person any right to acquire any shares of its capital stock, or issue, or commit to issue, sell, grant, dispose of, pledge or otherwise encumber, or authorize or propose the issuance, sale grant, disposition, pledge or other encumbrance of, any additional shares of capital stock, any securities convertible into or exercisable for, or any rights, warrants or options to acquire, any additional shares of capital stock, or any other securities in respect of, in lieu of, or in substitution for, any shares of its capital stock outstanding on the date of the Merger Agreement, except pursuant to the exercise or vesting of any outstanding equity awards as of the date of the Merger Agreement or permitted to be issued thereafter;

•        sell, transfer, mortgage, encumber or otherwise dispose of any of its material assets or material properties to any person (other than a direct wholly-owned subsidiary), by merger, consolidation, asset sale or other business combination (including formation of a joint venture) or cancel, release or assign any indebtedness to any such person or any claims held by any such person, except in the ordinary course of business consistent with past practice, disposition of obsolete or worthless assets, or sales of immaterial assets with a purchase price of $250,000;

•        make any investment or acquisition, by purchase or other acquisition of stock or other equity interests, by merger, consolidation, asset purchase or other business combination, or by contributions to capital; or make any material purchases of any property or assets, in or from any other person other than a wholly-owned subsidiary except in the ordinary course of business and in any case, involving consideration not in excess of $1,000,000;

•        enter into, renew, extend, amend or terminate any contract, lease or agreement that is or would be a material contract, except in the ordinary course of business consistent with past practice;

•        other than general pay increases, including in connection with promotions, made in the ordinary course of business consistent with past practice, for employees, directors or independent contractors generally, the payment of transaction-related bonuses to designated employees of Inpixon or as may be provided by any agreement in effect on the date of the Merger Agreement, (i) increase, or commit to increase, the

compensation or severance payable (including by granting or increasing the rate or terms of any salary, bonus, pension or other compensation except pursuant to the terms of any benefit plan of Inpixon or XTI), (ii) pay any severance other than in the ordinary course of business consistent with past practice or (iii) except as may be required, or advisable, to comply with applicable law or contract, amend, establish or enter into any benefit plan of Inpixon or XTI, as applicable, or other pension, retirement, profit-sharing, severance, retention or welfare benefit plan or agreement or incentive or employment, agreement with or for the benefit of any employee, director or independent contractor or accelerate the vesting of any stock options or other stock-based compensation;

•        amend its certificate of incorporation, bylaws or similar governing documents or similar organizational documents of any subsidiary;

•        enter into any new material line of business outside of its existing business;

•        assign, transfer, lease, cancel, fail to renew or fail to extend any material permit issued by any governmental entity;

•        incur any indebtedness for borrowed money, issue any debt securities or assume, guarantee or endorse or otherwise become responsible for the obligations of another person, or make any loans, advances of capital contributions to, or investments in, any other person, in each case, except in the ordinary course of business consistent with past practice;

•        make or change any material tax election or settle or compromise any material tax liability of XTI or of Inpixon, as applicable, or with respect to Inpixon, any of its subsidiaries;

•        make any material changes in its accounting methods or method of tax accounting, practices or policies, except as may be required under applicable law, rule, regulation or GAAP;

•        effect or permit, with respect to XTI or Inpixon, as applicable, and with respect to Inpixon, any of its subsidiaries, a “plant closing” or “mass layoff”, as such terms are defined under the Worker Adjustment and Retraining Act of 1988, as amended;

•        account for, manage or treat accounts receivable (including accelerating the collection thereof) or accounts payable (including delaying the payment thereof) in any manner other than in the in the ordinary course of business consistent with past practice;

•        except as permitted by the Merger Agreement, take any action that is intended or would reasonably be expected to result in any of the conditions to the merger not being satisfied;

•        agree to, or make any commitment to, take or announce any of the actions prohibited as described above.

Other Covenants and Agreements

•        Inpixon will amend its articles of incorporation upon the Effective Time to change its name to XTI Aerospace, Inc.;

•        From the date of the Merger Agreement until the Closing, each of XTI and Inpixon promptly shall provide advance written notice of, and to obtain the other party’s written consent to, each other of any XTI Permitted Issuances (as defined in the Merger Agreement) or Inpixon Permitted Issuances, as the case may be, and, only with respect to the issuance by XTI or Inpixon of any derivative securities requiring the other’s consent pursuant to the Merger Agreement, as the case may be, obtain the other’s advance written consent thereto;

•        as promptly as practicable following the date of the Merger Agreement, Inpixon and XTI agreed to cooperate to prepare and file with the SEC the registration statement, to which this proxy statement/prospectus is a part, to register with the SEC the shares of Inpixon common stock issuable pursuant to the Inpixon Stock Issuance, which will be sent to Inpixon’s stockholders in connection with the Inpixon special meeting to solicit proxies from Inpixon stockholders to vote at the Inpixon special meeting in favor of the Inpixon Stock Issuance and any other proposals the parties to the Merger Agreement deem necessary or desirable to consummate the merger and the related transactions contemplated by the Merger Agreement;

•        Inpixon and XTI will provide access to books and records and furnish relevant information to the other party, subject to certain limitations and confidentiality provisions;

•        Inpixon will use commercially reasonably efforts to enter into employment or consulting agreements with certain key employees and consultants;

•        Inpixon will take all actions reasonably necessary, proper or desirable to consummate the Solutions Divestiture;

•        for a period of six years after the Closing, Inpixon will indemnify each of the current and former directors and officers of Inpixon and XTI to the fullest extent permitted under the DGCL and will maintain directors’ and officers’ liability insurance for the directors and officers of Inpixon and XTI;

•        Inpixon Board and XTI Board will take all steps reasonably required to cause the transactions contemplated by the Merger Agreement to be exempt under Rule 16b-3 promulgated under the Exchange Act;

•        Inpixon and XTI will use its reasonable best efforts to take such actions so as to cause the merger to qualify as a reorganization within the meaning of Section 368(a) of the Code;

•        Inpixon will amend its bylaws to provide a classified board with three classes;

•        XTI will deliver its audited balance sheet as of December 31, 2021 and 2022 and audited statements of operations, cash flows and stockholders’ equity for the year ended December 31, 2021 and 2022 audited in accordance with PCAOB standards and any unaudited interim financial statements required by the registration statement, to which this proxy statement/prospectus is a part;

•        Inpixon will be permitted to pay transaction-related bonuses to certain employees;

•        Inpixon will use its reasonable best efforts to cause, at or prior to the Effective Time, each outstanding share of Inpixon preferred stock to be redeemed or otherwise converted into or exchanged for Inpixon common stock;

•        On the first calendar day of the month following the date of the Merger Agreement and on the first calendar day of each month thereafter until the earlier of (i) four months following the date of the Merger Agreement and (ii) the Closing Date, Inpixon will provide loans to XTI on a senior secured basis, in such amounts requested by XTI in writing prior to the first calendar day of each such month, each such monthly loan to be in the principal amount of up to $500,000 (up to a total of $1,775,000 or such greater amount as Inpixon shall otherwise agree in its sole and absolute discretion) by wire transfer of immediately available funds, such Future Loans and security to be evidenced by a Promissory Note and a Security Agreement, respectively;

•        Inpixon will file a registration statement under the Securities Act as soon as commercially practicable, and in any event, no later than ten Business Days, following the Closing, registering the resale of all shares of Inpixon Common Stock issued as Merger Consideration that are not registered on the Form S-4, and shall use its reasonable best efforts to cause such registration statement to be declared effective by the SEC as soon as commercially practicable following the initial filing thereof; and

•        Inpixon will use commercially reasonable efforts to consummate Parent Permitted Issuances prior to the Closing Date for aggregate gross cash proceeds of at least $10,000,000.

Termination

The Merger Agreement may be terminated at any time before the completion of the merger, whether before or after the required stockholder approvals to complete the merger have been obtained, as set forth below:

•        by mutual written consent of Inpixon and XTI;

•        by either Inpixon or XTI if the transactions contemplated by the Merger Agreement shall not have been consummated by December 31, 2023 (the “Outside Date”); provided, however, that if by the Outside Date, all of the closing conditions have been satisfied except for obtaining the required Inpixon stockholder approval or any other required consent or authorization from any governance entity, the Outside Date

may be extended for one or more periods of up to 30 days per extension by each of Inpixon or XTI up to an aggregate extension so that the Outside Date, as so extended, shall not be later than April 1, 2024; and provided, further, that the right to terminate the Merger Agreement will not be available to any party whose breach of any representation, warranty, covenant, or agreement set forth in the Merger Agreement has been the cause of, or resulted in, the failure of the merger to be consummated on or before the Outside Date;

•        by either Inpixon or XTI if the Inpixon special meeting shall have been held and completed, the Inpixon stockholders shall have taken a final vote on the Inpixon Stock Issuance, and the required Inpixon stockholder approval shall not have been obtained;

•        by either Inpixon or XTI if the XTI Stockholder Consent shall not have been obtained within 72 hours after the execution and delivery of the Merger Agreement;

•        by either Inpixon or XTI if any governmental entity of competent jurisdiction shall have issued or entered any law or order making illegal, permanently enjoining, or otherwise permanently prohibiting the merger or any of the other transactions contemplated by the Merger Agreement, provided, however, that the right to terminate the Merger Agreement will not be available to any party whose breach of any representation, warranty, covenant, or agreement set forth in the Merger Agreement has been the cause of, or resulted in, the issuance or entry of any such law or order;

•        by XTI, if

•        the Inpixon Board shall have made a change in recommendation;

•        Inpixon shall have breached or failed to perform in any material respect any of its covenants and agreements regarding the Inpixon special meeting or non-solicitation;

•        if prior to the receipt of the required XTI stockholder approval, the XTI Board authorizes the XTI, in full compliance with the terms of the Merger Agreement, to enter into an Alternative Acquisition Agreement in respect of a Superior Proposal; provided, that XTI shall have paid any termination fee required in the Merger Agreement, and at the times, specified therein; provided, further, that in the event of such termination, XTI substantially concurrently enters into such Alternative Acquisition Agreement;

•        if there shall have been a breach of any representation, warranty, covenant, or agreement on the part of Inpixon set forth in the Merger Agreement (other than with respect to a breach of the provisions regarding the Inpixon special meeting or non-solicitation) such that the conditions to the Closing would not be satisfied and, cannot be cured by Inpixon or, if capable of being cured, shall not have been cured by the later of (A) the Outside Date and (B) the date that is 30 days following receipt of written notice from XTI describing such breach or failure in reasonable detail; provided, however, XTI shall have given Inpixon at least 30 days written notice prior to such termination stating XTI’s intention to terminate the Merger Agreement; provided, further, XTI shall not have the right to terminate the Merger Agreement if XTI is then in material breach of any representation, warranty, covenant, or obligation hereunder, which breach has not been cured;

•        by Inpixon, if

•        the XTI Board shall have made a change in recommendation;

•        XTI shall have breached or failed to perform in any material respect any of its covenants and agreements regarding the XTI Stockholder Consent and non-solicitation;

•        if prior to the receipt of the required Inpixon stockholder approval, the Inpixon Board authorizes Inpixon, in full compliance with the terms of the Merger Agreement, to enter into an Alternative Acquisition Agreement in respect of a Superior Proposal; provided, that Inpixon shall have paid any termination fee required in the Merger Agreement, and at the times, specified therein; provided, further, that in the event of such termination, Inpixon substantially concurrently enters into such Alternative Acquisition Agreement;

•        if there shall have been a breach of any representation, warranty, covenant, or agreement on the part of XTI set forth in the Merger Agreement (other than with respect to a breach of the provisions regarding the XTI Stockholder Consent or non-solicitation) such that the conditions to the Closing would not be satisfied and, cannot be cured by Inpixon or, if capable of being cured, shall not have been cured by the later of (A) the Outside Date and (B) the date that is 30 days following receipt of written notice from Inpixon describing such breach or failure in reasonable detail; provided, however, Inpixon shall have given XTI at least 30 days written notice prior to such termination stating Inpixon’s intention to terminate the Merger Agreement; provided, further, Inpixon shall not have the right to terminate the Merger Agreement if Inpixon is then in material breach of any representation, warranty, covenant, or obligation hereunder, which breach has not been cured.

Termination Fee

Fee payable by Inpixon

Inpixon must pay XTI a termination fee of $2,000,000, if:

•        the Merger Agreement is terminated by XTI because Inpixon conducts a change in recommendation or in material breach of its covenants and agreements regarding the Inpixon special meeting or non-solicitation, in which case the maturity date in respect of Future Loans and Existing Loans would be extended to December 31, 2024;

•        the Merger Agreement is terminated by Inpixon because Inpixon adopts a Superior Proposal, in which case the Future Loans and Existing Loans would be forgiven and the related security interest would be released;

•        the Merger Agreement is terminated (i) by XTI because of Inpixon’s breach, provided, however, that the required Inpixon stockholder approval shall not have been obtained, or (ii) by XTI or Inpixon because of the expiration of the Outside Date, provided, however, that the required Inpixon stockholder approval shall not have been obtained, and, in each of the cases described above: (a) prior to such termination, an Acquisition Proposal with respect to Inpixon (all references in the definition of Acquisition Proposal to 20% shall be deemed to be references to “more than 50%” instead) shall have been publicly disclosed and not withdrawn, and (b) within 12 months following the date of the termination of the Merger Agreement, Inpixon shall have entered into a definitive agreement with respect to any Acquisition Proposal, or any Acquisition Proposal shall have been consummated (in each case, whether or not such Acquisition Proposal is the same as the original Acquisition Proposal made, communicated or publicly disclosed), then the Termination Fee is required immediately prior to and as a condition to consummating such transaction.

Fee payable by XTI

XTI must pay Inpixon a termination fee of $2,000,000, if

•        the Merger Agreement is terminated by Inpixon because XTI conducts a change in recommendation or in material breach of its covenants and agreements regarding the XTI Stockholder Consent or non-solicitation;

•        the Merger Agreement is terminated by XTI because XTI adopts a Superior Proposal, in which case XTI will pay to Inpixon, within three business days, all outstanding principal and accrued but unpaid interest in respect of the Future Loans and the Existing Loans, together with any outstanding fees and expenses payable by XTI to Inpixon;

•        the Merger Agreement is terminated (i) by Inpixon because of XTI’s breach, provided, however, that the required XTI stockholder approval shall not have been obtained, or (ii) by XTI or Inpixon because of the expiration of the Outside Date, provided, however, that the required XTI stockholder approval shall not have been obtained, and, in each of the cases described above: (a) prior to such termination, an Acquisition Proposal with respect to XTI (all references in the definition of Acquisition Proposal to 20% shall be deemed to be references to “more than 50%” instead) shall have been publicly disclosed and not withdrawn, and (b) within 12 months following the date of the termination of the Merger Agreement, XTI shall have entered into a definitive agreement with respect to any Acquisition Proposal, or any Acquisition

Proposal shall have been consummated (in each case, whether or not such Acquisition Proposal is the same as the original Acquisition Proposal made, communicated or publicly disclosed), then the Termination Fee is required immediately prior to and as a condition to consummating such transaction.

Amendment

The Merger Agreement may be amended by the parties at any time if such amendment is in writing, is approved by the boards of directors of each party to the Merger Agreement and is signed by each party to the Merger Agreement, except that after receipt of the required XTI stockholder approval, no amendment which by law or in accordance with the rules of any relevant stock exchange requires further approval by the stockholders of XTI may be, shall be made without such further approval.

MATTERS BEING SUBMITTED TO A VOTE OF INPIXON STOCKHOLDERS

Proposal No. 1: The Nasdaq Stock Issuance Proposal

At the Inpixon special meeting, Inpixon stockholders will be asked to approve the issuance of Inpixon common stock to XTI equityholders pursuant to the Merger Agreement and the change of control of Inpixon resulting from the merger.

Assuming the fully diluted capitalization of Inpixon and XTI immediately prior to the Effective Time is unchanged from the same as of October 24, 2023, the Exchange Ratio is estimated to be 0.081236145 based on Inpixon and XTI’s fully diluted capitalization as of October 24, 2023, the amounts of the other elements defined in the Exchange Ratio Formula as of October 24, 2023, as well as the assumption that Inpixon will deliver an amount of net cash equal to $10 million and that the Inpixon Reverse Stock Split will be effected immediately prior to the consummation of the merger at a ratio of 1-for-50. Inpixon may effect a reverse stock split at a different ratio, subject to compliance with applicable law, and references in this proxy statement/prospectus to a 1-for-50 reverse stock split are for illustrative purposes only. The Exchange Ratio will be further adjusted if any of the assumptions described above have changed as of the effective time of the merger, including the fully diluted capitalization of the parties, Inpixon’s actual net cash as calculated and as of a time determined in accordance with the Merger Agreement, and the outstanding balance payable under the Streeterville Notes. Immediately following the Effective Time, Inpixon stockholders are expected to own approximately 40% of the issued and outstanding shares of Inpixon common stock, while XTI stockholders immediately prior to the Effective Time are expected to own approximately 60% of the issued and outstanding shares of Inpixon common stock, excluding the impact of additional shares of Inpixon common stock that may be issued upon the exercise or vesting, as applicable, of the combined company’s outstanding shares of preferred stock, warrants, unvested restricted stock and options including the Assumed Options, Warrants and Note following the Closing.

Nasdaq Listing Rule 5635(a)(1) requires a company listed on Nasdaq to obtain stockholder approval prior to the issuance of common stock, among other things, in connection with the acquisition of the stock or assets of another company, if the number of shares of common stock to be issued is equal to or in excess of 20% of the number of shares of common stock then outstanding. The potential issuance of the shares of Inpixon common stock in the merger will exceed the 20% threshold under the Nasdaq Listing Rules. Accordingly, in order to ensure compliance with Nasdaq Listing Rule 5635(a)(1), Inpixon must obtain the approval of Inpixon Stockholders for the issuance of these shares in the merger.

Nasdaq Listing Rule 5635(b) requires a company listed on Nasdaq to obtain stockholder approval prior to an issuance of securities that will result in a “change of control” of the company. Although Nasdaq has not adopted any rule as to what constitutes a “change of control” for purposes of Rule 5635(b), Nasdaq has previously indicated that the acquisition of, or right to acquire, by a single investor or affiliated investor group, as little as 20% of the common stock (or securities convertible into or exercisable for common stock) or voting power of an issuer could constitute a change of control. In addition, Inpixon expects that the staff of Nasdaq will deem the merger to be a “change of control.” Accordingly, in order to ensure compliance with Nasdaq Listing Rule 5635(b), Inpixon must obtain the approval of Inpixon stockholders for the potential change in control of Inpixon resulting from the merger.

The terms of, reasons for and other aspects of the Merger Agreement, the merger, the issuance of Inpixon common stock to XTI equityholders pursuant to the Merger Agreement and the resulting change of control are described in detail in the other sections in this proxy statement/prospectus.

Vote Required

The affirmative vote of a majority of the votes cast by the holders of Inpixon common stock present virtually or by proxy at the Inpixon special meeting and entitled to vote on the matter is required for approval of the Nasdaq Stock Issuance Proposal. Abstentions and broker non-votes will have no effect on this proposal.

Recommendation of Inpixon Board

THE INPIXON BOARD RECOMMENDS THAT INPIXON STOCKHOLDERS VOTE “FOR” THE NASDAQ STOCK ISSUANCE PROPOSAL TO APPROVE THE ISSUANCE OF INPIXON COMMON STOCK TO XTI EQUITYHOLDERS PURSUANT TO THE MERGER AGREEMENT AND THE CHANGE OF CONTROL OF INPIXON RESULTING FROM THE MERGER. THE MERGER CANNOT BE CONSUMMATED WITHOUT THE APPROVAL OF THE NASDAQ STOCK ISSUANCE PROPOSAL.

Proposal No. 2: The Transaction Bonus Plan Proposal

General

Section 14A of the Exchange Act, which was enacted as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, requires that Inpixon provide stockholders with the opportunity to vote to approve, on non-binding, advisory basis, the payment of certain compensation that will or may become payable by Inpixon to its named executive officers in connection with the merger, as disclosed in the section titled “The Merger — Interests of Inpixon Directors and Executive Officers in the Merger.”

Upon the consummation of the merger, it is expected that each of the Inpixon named executive officers will be terminated without cause. Therefore, Inpixon is asking stockholders to indicate their approval of the compensation that will or may become payable by Inpixon to its named executive officers in connection with the merger. These payments are set forth in the section titled “The Merger — Interests of Inpixon Directors and Executive Officers in the Merger,” and the accompanying footnotes. In general, the employment agreements, equity awards and other arrangements including the Transaction Bonus Plan pursuant to which these compensation payments may be made have formed a part of Inpixon’s overall compensation program for its named executive officers. These employment agreements, equity awards and other arrangements including the Transaction Bonus Plan were adopted and approved by the compensation committee of Inpixon, which is composed solely of non-management directors, by the Inpixon board of directors and by the stockholders of Inpixon in its annual non-binding say-on-pay votes, where applicable, and are believed to be reasonable and in line with marketplace norms.

Accordingly, Inpixon is asking the stockholders of Inpixon to approve, on a nonbinding, advisory basis, the compensation that will or may become payable by Inpixon to its named executive officers that is based on or otherwise relates to the merger as disclosed pursuant to Item 402(t) of Regulation S-K in the section titled “The Merger — Interests of Inpixon Directors and Executive Officers in the Merger.”

Stockholders of Inpixon should note that this proposal is not a condition to the closing of the merger, and as an advisory vote, the result will not be binding on Inpixon, its board of directors or the named executive officers. Further, the underlying employment agreements, equity awards and other arrangements including the Transaction Bonus Plan are contractual in nature and not, by their terms, subject to stockholder approval. Accordingly, regardless of the outcome of the advisory vote, if the merger is consummated and Inpixon’s named executive officers cease to be employed in connection with the merger, the named executive officers will be eligible to receive the compensation that is based on or otherwise relates to the merger in accordance with the terms and conditions applicable to the underlying employment agreements, equity awards and other arrangements including the Transaction Bonus Plan Inpixon entered into with these named executive officers.

Vote Required

The affirmative vote of a majority of the votes cast by the holders of Inpixon common stock present virtually or by proxy at the Inpixon special meeting and entitled to vote on the matter is required for approval of the Transaction Bonus Plan Proposal. Abstentions and broker non-votes will have no effect on this proposal.

Recommendation of Inpixon Board

THE INPIXON BOARD RECOMMENDS THAT INPIXON STOCKHOLDERS VOTE “FOR” the Transaction Bonus Plan Proposal TO APPROVE ON A NON-BINDING ADVISORY VOTE BASIS, COMPENSATION THAT WILL OR MAY BECOME PAYABLE BY INPIXON TO ITS NAMED EXECUTIVE OFFICERS IN CONNECTION WITH THE MERGER.

Proposal No. 3: The Director Election Proposal

Inpixon’s business affairs are managed under the direction of Inpixon’s Board, which is currently composed of five members. Three of Inpixon’s directors are independent according to the independent director requirements of Nasdaq. Inpixon’s directors serve for one-year terms.

At the Inpixon special meeting, Inpixon stockholders will be asked to elect the following five directors to serve until the 2024 annual meeting of Inpixon stockholders or until their successors are duly elected and qualified:

•        Nadir Ali

•        Wendy Loundermon

•        Leonard Oppenheim

•        Kareem Irfan

•        Tanveer Khader

If a quorum is present at the Inpixon special meeting, then nominees will be elected by a majority of the votes cast by the holders of shares present virtually or represented by proxy and entitled to vote at the meeting. There is no cumulative voting in the election of Inpixon directors.

In the event that any nominee for any reason is unable to serve, or for good cause will not serve, the proxies will be voted for such substitute nominee as the Inpixon Board may determine. We are not aware of any nominee who will be unable to serve, or for good cause will not serve, as a director.

Unless otherwise provided by law, any vacancy on the Inpixon Board may be filled by a majority of the directors then in office, even if less than a quorum, or by a sole remaining director. A vacancy in the Inpixon Board created by the removal of a director, and not otherwise filled by the remaining directors, may be filled by the vote of a plurality of the votes cast at the annual meeting of the stockholders or at a duly called special meeting at which a quorum is present, or by the written consent of the holders of a majority of the outstanding Inpixon shares.

The relevant experiences, qualifications, attributes or skills of each nominee that led the Inpixon Board to recommend the above persons as a nominee for director are described in the section entitled “Inpixon Executive Officers, Directors and Corporate Governance.”

Inpixon stockholders should understand, however, that if the Business Combination is consummated, the effect of the approval of the director nominees named in the Director Election Proposal will be limited because the composition of the Inpixon Board will be reconstituted upon completion of the Business Combination, in accordance with the Merger Agreement. For more information regarding the expected directors of the combined company, please see the section titled “Management of the Combined Company Following the Merger.”

Vote Required

The nominees will be elected by a majority of the votes cast by the holders of Inpixon common stock entitled to vote at the Inpixon special meeting present virtually or represented by proxy and entitled to vote in the election. You may choose to vote FOR, AGAINST, or ABSTAIN separately for each nominee. If your shares are held by a broker and you do not give the broker specific instructions on how to vote your shares, your broker may not vote your shares at its discretion. Abstentions and broker non-votes will have no effect on the outcome of the vote on this proposal.

Recommendation of Inpixon Board

THE INPIXON BOARD RECOMMENDS THAT INPIXON STOCKHOLDERS VOTE “FOR” EACH OF THE NOMINEES LISTED ABOVE.

Proposal No. 4: The Say-on-Pay Proposal

Pay that reflects performance and alignment of pay with the long-term interests of our stockholders are key principles that underlie Inpixon’s compensation program. The Dodd-Frank Act enables our stockholders to approve, on an advisory basis, the compensation of our Named Executive Officers as disclosed in this proxy statement/prospectus in accordance with the SEC’s rules. The proposal, commonly known as a “say-on-pay” proposal, is required under Section 14A of the Exchange Act (which was put in place by the Dodd-Frank Act) and gives our stockholders the opportunity to express their views on Inpixon’s executive compensation. Because this vote is an advisory vote, this proposal is not binding upon Inpixon, the Inpixon Board or its Compensation Committee; however, the Compensation Committee, which is responsible for designing and administering Inpixon’s executive compensation program, values the opinions expressed by Inpixon stockholders in their vote on this proposal and will review the voting results. To the extent there is any significant vote against the compensation of our Named Executive Officers as disclosed in this proxy statement/prospectus, we will consider the concerns of the Inpixon stockholders and the Compensation Committee will evaluate whether any actions are necessary to address these concerns.

We are asking the Inpixon stockholders to indicate their support for Inpixon’s Named Executive Officer compensation program as described in this proxy statement/prospectus in accordance with the compensation disclosure rules of the SEC. This vote is not intended to address any specific item of compensation, but rather the overall compensation of Inpixon’s Named Executive Officers and the policies and practices described in this proxy statement/prospectus. Accordingly, we ask our stockholders to vote “FOR” the following resolution at the Inpixon special meeting:

“RESOLVED, that the compensation paid to Inpixon’s Named Executive Officers, as disclosed pursuant to Item 402 of Regulation S-K, including the compensation tables and the related narrative discussion in this proxy statement/prospectus, is hereby APPROVED.”

As required by the Dodd-Frank Act, this vote does not overrule any decisions by the Inpixon Board, will not create or imply any change to or any additional fiduciary duties of the Inpixon Board.

Inpixon’s next “say-on-pay” vote is expected to occur at the annual meeting of Inpixon stockholders in 2026. As required by Section 14A, Inpixon’s next vote on a proposal regarding the frequency of the vote on future say-on-pay proposals is expected to occur at the annual meeting of Inpixon stockholders in 2026.

Vote Required

The affirmative vote of a majority of the votes cast by holders of Inpixon common stock present virtually or by proxy at the Inpixon special meeting and entitled to vote on the matter is required for approval of, on an advisory basis, the executive compensation. This is a non-binding advisory vote. If your Inpixon shares are held by a broker and you do not give the broker specific instructions on how to vote your shares, your broker may not vote your shares at its discretion. Abstentions and broker non-votes will have no effect on the outcome of the vote on this proposal.

Recommendation of Inpixon Board

THE INPIXON BOARD RECOMMENDS THAT INPIXON STOCKHOLDERS VOTE “FOR” THE SAY-ON-PAY PROPOSAL TO APPROVE, ON AN ADVISORY BASIS, OF THE COMPENSATION PAID TO INPIXON’S NAMED EXECUTIVE OFFICERS.

Proposal No. 5: The Auditor Ratification Proposal

The Audit Committee of the Inpixon Board has appointed Marcum LLP (“Marcum”) as Inpixon’s independent registered public accounting firm to audit its financial statements for the fiscal year ending December 31, 2023. Marcum has served as Inpixon’s independent registered public accounting firm since 2012.

Inpixon stockholder ratification of the selection of Marcum as its independent registered public accounting firm is not required by Inpixon’s Bylaws or the Nevada Revised Statutes. The Inpixon Board seeks such ratification as a matter of good corporate practice. Should the Inpixon stockholders fail to ratify the selection of Marcum as its independent registered public accounting firm, the Inpixon Board will reconsider whether to retain that firm for fiscal year 2023. In making its recommendation to the Inpixon Board that Inpixon stockholders ratify the appointment of Marcum as its independent registered public accounting firm for the fiscal year ending December 31, 2023, the Inpixon Audit Committee considered whether Marcum’s provision of non-audit services is compatible with maintaining the independence of its independent registered public accounting firm. The Inpixon Audit Committee pre-approved the audit fees, audit-related fees, tax fees and all other fees described below in accordance with Inpixon’s pre-approval policy and believes such fees are compatible with the independence of Marcum. Set forth below are approximate fees for services rendered by Marcum LLP, Inpixon’s independent registered public accounting firm, for the fiscal years ended December 31, 2022 and 2021.

Audit Fees.    The “Audit Fees” are the aggregate fees of Marcum attributable to professional services rendered in 2022 and 2021 for the audit of Inpixon’s annual financial statements, for review of financial statements included in Inpixon’s quarterly reports on Form 10-Q or for services that are normally provided by Marcum in connection with statutory and regulatory filings or engagements for that fiscal year. These fees include fees billed for professional services rendered by Marcum for the review of registration statements or services that are normally provided in connection with statutory and regulatory filings or engagements for those fiscal years.

Audit-Related Fees.    Marcum billed Inpixon for professional services that were reasonably related to the performance of the audit or review of financial statements in 2022 and 2021, which are not included under Audit Fees above including the filing of Inpixon’s registration statements. This amount also includes audit fees related to acquisitions.

Tax Fees.    Marcum did not perform any tax advice or planning services in 2022 or 2021.

All Other Fees.    Marcum did not perform any services for us or charge any fees other than the services described above in 2022 and 2021.

Pre-approval Policies and Procedures

The Inpixon Audit Committee is required to review and approve in advance the retention of the independent auditors for the performance of all audit and lawfully permitted non-audit services and the fees for such services. The Inpixon Audit Committee may delegate to one or more of its members the authority to grant pre-approvals for the performance of non-audit services, and any such Audit Committee member who pre-approves a non-audit service must report the pre-approval to the full Inpixon Audit Committee at its next scheduled meeting. The Inpixon Audit Committee is required to periodically notify the Inpixon Board of their approvals. The required pre-approval policies and procedures were complied with during 2022.

Marcum LLP Representatives at Inpixon Special Meeting

We expect that representatives of Marcum will be present at the Inpixon special meeting. They will be given the opportunity to make a statement if they desire to do so, and they will be available to respond to appropriate questions after the meeting.

Vote Required

The affirmative vote of the holders of Inpixon common stock entitled to vote at the Inpixon special meeting representing a majority of the votes cast on such matter will be required for the ratification of the appointment of Marcum LLP as Inpixon’s independent registered public accounting firm for the fiscal year ending December 31, 2023. Abstentions and broker non-votes will have no effect on the outcome of the vote on this proposal. Brokers generally have discretionary authority to vote on the ratification of our independent registered public accounting firm, thus, broker non-votes are not expected to result from the vote on this proposal.

Recommendation of Inpixon Board

THE INPIXON BOARD RECOMMENDS THAT INPIXON STOCKHOLDERS VOTE “FOR” THE AUDITOR RATIFICATION PROPOSAL TO RATIFY MARCUM LLP AS INPIXON’S INDEPENDENT REGISTERED ACCOUNTING FIRM FOR THE FISCAL YEAR ENDING DECEMBER 31, 2023.

REPORT OF THE INPIXON AUDIT COMMITTEE

The Audit Committee of the Inpixon Board has:

•        reviewed and discussed Inpixon’s audited consolidated financial statements for the year ended December 31, 2022 with management;

•        discussed with Inpixon’s independent auditors the matters required to be discussed under Public Company Accounting Oversight Board Auditing Standard No. 1301; and

•        received the written disclosures and letter from the independent auditors required by the applicable requirements of the Public Accounting Oversight Board regarding the independent auditors communications with the Audit Committee of the Inpixon Board concerning independence, and has discussed with Marcum LLP matters relating to its independence.

In reliance on the review and discussions referred to above, the Audit Committee recommended to the Inpixon Board that the consolidated financial statements audited by Marcum LLP for the fiscal year ended December 31, 2022 be included in its Annual Report on Form 10-K for such fiscal year.

Audit Committee of the Board

Although this proposal to increase the authorized Inpixon common stock has been prompted by business and financial considerations and not by the threat of any hostile takeover attempt (nor is the Inpixon Board currently aware of any such attempts directed at us), nevertheless, stockholders should be aware that approval of this Proposal No. 6 could facilitate future efforts by us to deter or prevent changes in control, including transactions in which the stockholders might otherwise receive a premium for their shares over then current market prices.

This proposal will be effective upon its approval by our stockholders at the Inpixon special meeting and is not conditioned upon the approval by our stockholders of any other proposal. As each proposal will be presented to our stockholders at the Inpixon special meeting in the order presented herein, if this proposal is approved by our stockholders, it will become effective.

No Rights of Dissent or Appraisal

Under the NRS, stockholders are not entitled to rights of dissent or appraisal with respect to an increase in the number of authorized shares of Inpixon common stock as pursuant to this Proposal No. 6, and Inpixon will not independently provide the stockholders with any such right.

Vote Required

The affirmative vote of the holders of shares of Inpixon common stock representing a majority of the issued and outstanding shares of Inpixon common stock entitled to vote at the Inpixon special meeting will be required for approval of this proposal. Accordingly, abstentions and broker non-votes will have the same legal effect as votes “AGAINST” this proposal. Brokers generally have discretionary authority to vote on the amendment to our Articles of Incorporation to increase the number of authorized shares of common stock, thus, broker non-votes are not expected to result from the vote on this proposal.

Recommendation of Inpixon Board

THE INPIXON BOARD RECOMMENDS THAT INPIXON STOCKHOLDERS VOTE “FOR” THE AUTHORIZED SHARE INCREASE PROPOSAL TO APPROVE OF THE AMENDMENT TO INPIXON’S ARTICLES OF INCORPORATION TO INCREASE THE NUMBER OF AUTHORIZED SHARES OF COMMON STOCK TO UP TO 1,000,000,000 SHARES, WITH SUCH NUMBER TO BE DETERMINED AT THE INPIXON BOARD’S DISCRETION.

Proposal No. 7: The Reverse Split Ratio Proposal

Background and Purpose of the Reverse Split Ratio Increase

As reported on Inpixon’s current report on Form 8-K filed with the SEC on October 3, 2023, Inpixon held a special meeting of stockholders on September 29, 2023, at which our stockholders approved an amendment to Inpixon’s Articles of Incorporation to effect a reverse stock split of the outstanding Inpixon common stock, at a ratio between 1-for-2 and 1-for-50, to be determined at the discretion of the Inpixon Board, for the purpose of complying with the Nasdaq Listing Rules, subject to the Inpixon Board’s discretion to abandon such amendment. Upon receiving the stockholder approval, the Inpixon Board is authorized to implement the Inpixon Reverse Stock Split within the next twelve months (the “Authorized Period”). We expect to effect the Inpixon Reverse Stock Split immediately prior to the closing of the merger with XTI.

Inpixon is asking its stockholders to consider and vote upon a proposal to increase the maximum reverse stock split ratio previously approved by the stockholders at the special meeting held on September 29, 2023 from 1-to-50 to 1-for-200, for the purposes discussed below.

In addition to increasing the market price of our common stock so that we can meet the continued listing requirements of Nasdaq and enhancing the appeal of our common stock to the financial community with a higher priced stock, as discussed in greater detail under “Proposal One — Approval of the Amendment to Effect the Reverse Split” in the definitive proxy statement filed with the SEC on July 3, 2023, we believe increasing the previously approved maximum Reverse split ratio will provide additional flexibility in enabling us to satisfy the $4.00 minimum bid price requirement of the initial listing criteria of Nasdaq for the combined company, as required by Nasdaq Listing Rule 5110(a) in connection with the proposed merger with XTI. While stockholder approval of this proposal is not required by the merger agreement with XTI, we believe we will need to effect a reverse stock split to consummate the contemplated merger with XTI, and we may need to effect a reverse stock split at a ratio greater than 1-for-50 to satisfy the $4.00 minimum bid price requirement of the initial listing criteria of Nasdaq.

If this proposal is not approved by our stockholders, NRS  78.2055 will permit us to effect a reverse stock split of any ratio determined by our board of directors, so long as we effect a corresponding reduction of our authorized shares of common stock. However, if this proposal is not approved by our stockholders, and we are required to effect a reverse stock split at a ratio greater than 1-for-50 in order to meet the $4.00 minimum bid price requirement of the Nasdaq initial listing criteria in connection with the proposed merger with XTI, and we are required to reduce our authorized shares of common stock by a corresponding amount as a result, we may not have adequate authorized shares to satisfy our capital requirements, including our capital requirements to satisfy the initial listing criteria of the Nasdaq Capital Market in connection with the proposed merger with XTI. Accordingly, our board of directors has unanimously adopted resolutions approving a proposal to increase the maximum reverse stock split ratio previously approved by our stockholders at the special meeting held on September 29, 2023 from 1-to-50 to 1-for-200, and strongly recommends voting in favor of this proposal.

Board Discretion to Implement the Inpixon Reverse Stock Split

If this proposal is approved by our stockholders, the Inpixon Board will have the authority, in its sole determination without any further action necessary by the stockholders, to effect the Inpixon Reverse Stock Split during the Authorized Period at a ratio of 1-for-2 to 1-for-200, as determined by the Inpixon Board. The Inpixon Board may, in its sole determination, choose to not effect the Inpixon Reverse Stock Split. The Inpixon Board believes that granting this discretionary authority provides the Inpixon Board with maximum flexibility to react to prevailing market conditions and future changes to the market price of our common stock, and therefore better enables it to act in the best interests of Inpixon. In exercising its discretion, the Inpixon Board may consider the following factors:

•        the historical trading price and trading volume of our common stock;

•        the then-prevailing trading price and trading volume of our common stock and the anticipated impact of the Inpixon Reverse Stock Split on the trading market for our common stock;

•        the prevailing general market and economic conditions; and

•        the conditions required to be satisfied to close the merger with XTI.

At the close of business on October 24, 2023, Inpixon had 127,688,550 shares of common stock issued and outstanding. Following the effectiveness of the Inpixon Reverse Stock Split, if implemented, at a 1-for-2 ratio, Inpixon would have approximately 63,844,275 shares of common stock issued and outstanding (without giving effect to the treatment of fractional shares or any issuances of common stock after October, 2023) following the Inpixon Reverse Stock Split and at a 1-for-200 ratio, Inpixon would have approximately 638,442 shares of common stock issued and outstanding (without giving effect to the treatment of fractional shares or any issuances of common stock after October 24, 2023) following the Inpixon Reverse Stock Split. The actual number of shares of common stock outstanding after giving effect to the Inpixon Reverse Stock Split will depend on the ratio that is ultimately selected by the Inpixon Board, and the number of shares of common stock outstanding at the time the Inpixon Reverse Stock Split is effected. Inpixon does not expect the Inpixon Reverse Stock Split to have any economic effect on stockholders, warrant holders, debt holders or holders of options, except to the extent the Inpixon Reverse Stock Split results in fractional shares as discussed below.

Procedure for Effecting the Inpixon Reverse Stock Split

Subject to the stockholder approval, if the Inpixon Board decides to implement the Inpixon Reverse Stock Split, the Inpixon Board will effect the split at a ratio between 1-for-2 and 1-for-200, to be determined at the discretion of the Inpixon Board. We will file a Certificate of Amendment to our Articles of Incorporation, substantially in the form attached to this Proxy Statement as Annex E, with the Secretary of State of the State of Nevada to effect the Inpixon Reverse Stock Split. The Inpixon Reverse Stock Split would become effective at such time as the Certificate of Amendment is filed with the Secretary of State of the State of Nevada or at such later time as is specified therein. No further action on the part of our stockholders would be required and all shares of our common stock that were issued and outstanding immediately prior thereto would automatically be converted into new shares of our common stock based on the Inpixon Reverse Stock Split exchange ratio. As soon as practicable after the effective date of the Inpixon Reverse Stock Split, stockholders of record on the record date for the implemented Inpixon Reverse Stock Split would receive a letter from our transfer agent asking them to return the outstanding certificates representing our pre-split shares, which would be cancelled upon receipt by our transfer agent, and new certificates representing the post-split shares of our common stock would be sent to each of our stockholders. We will bear the costs of the issuance of the new stock certificates.

Effects of the Inpixon Reverse Stock Split Assuming Approval of the Reverse Split Ratio Increase

If the Inpixon Reverse Stock Split is implemented by the Inpixon Board, the principal effect will be to proportionately decrease the number of outstanding shares of common stock based on the split ratio. Shares of our common stock are currently registered under Section 12(b) of the Exchange Act and Inpixon is thus subject to the periodic reporting and other requirements of the Exchange Act. The Inpixon Reverse Stock Split will not affect the registration of our common stock with the SEC or Nasdaq, where the Common stock is traded. Following the Inpixon Reverse Stock Split, our common stock would continue to be listed on Nasdaq, assuming Inpixon’s compliance with the other continued listing standards of Nasdaq, although the shares will receive a new CUSIP number.

Proportionate voting rights and other rights of the holders of shares of our common stock will not be affected by the Inpixon Reverse Stock Split, other than as a result of the treatment of fractional shares as described below. For example, a holder of 2% of the voting power of the outstanding shares immediately prior to the effectiveness of the Inpixon Reverse Stock Split will generally continue to hold 2% of the voting power of the outstanding common stock after the Inpixon Reverse Stock Split. The number of stockholders of record will not be affected by the Inpixon Reverse Stock Split, other than as a result of the treatment of fractional shares as described below. If approved and implemented, the Inpixon Reverse Stock Split may result in some stockholders owning “odd lots” of less than 100 shares. Odd lot shares may be more difficult to sell, and brokerage commissions and other costs of transactions in odd lots are generally somewhat higher than the costs of transactions in “round lots” of even multiples of 100 shares. The Inpixon Board believes, however, that these potential effects are outweighed by the benefits to Inpixon of the Inpixon Reverse Stock Split.

The table, which does not take into account an increase in the authorized shares to up to 1,000,000,000 pursuant to Proposal No. 6 or the Inpixon Board’s authority to effect a reverse stock split without stockholder approval if the reduction in the number of issued and outstanding shares of common stock is coupled with a corresponding decrease in the number of authorized shares of common stock, below illustrates the number of shares of common stock authorized for issuance following the Inpixon Reverse Stock Split, the approximate number of shares of common stock that would

remain outstanding following the Inpixon Reverse Stock Split, and the number of unreserved shares of common stock available for future issuance following the Inpixon Reverse Stock Split. The information in the following table is based on 127,688,550 shares of common stock issued and outstanding as of October 24, 2023 and 207,087,914 shares reserved for future issuance as of October 24, 2023.

____________

(1)      All share numbers are rounded up to the nearest whole share but otherwise do not reflect the potential effect of rounding up for fractional shares that may result from the Inpixon Reverse Stock Split, which is subject to the Inpixon Board’s discretion to instead pay cash in lieu of any fractional shares.

As reflected in the table above, the number of authorized shares of our common stock will not be reduced by the Inpixon Reverse Stock Split. Accordingly, the Inpixon Reverse Stock Split will have the effect of creating additional unissued and unreserved shares of our common stock. We have no current arrangements or understandings providing for the issuance of any of the additional authorized and unreserved shares of our common stock that would be available as a result of the proposed Inpixon Reverse Stock Split. However, these additional shares may be used by us for various purposes in the future without further stockholder approval (subject to applicable Nasdaq listing rules), including, among other things: (i) raising capital necessary to fund our future operations and satisfying the closing conditions for the merger with XTI, (ii) providing equity incentives to our employees, officers, directors and consultants, (iii) entering into collaborations and other strategic relationships and (iv) expanding our business through the acquisition of other businesses or products.

The Exchange Ratio to determine the number of shares of Inpixon common stock to issue to XTI securityholders under the Merger Agreement will be adjusted based on the reverse split ratio of the Inpixon Reverse Stock Split. Therefore, the Inpixon Reverse Stock Split and the ratio determined by the Inpixon Board will not affect the anticipated percentage of issued and outstanding common stock of the combined company to be owned by the Inpixon stockholders and XTI stockholders immediately prior to the Effective Time.

Effect of the Inpixon Reverse Stock Split on Inpixon’s Amended and Restated 2011 Employee Stock Incentive Plan, Inpixon’s 2018 Employee Stock Incentive Plan, Warrants and Convertible or Exchangeable Securities

Based upon the split ratio, proportionate adjustments are generally required to be made to the per share exercise price and the number of shares issuable upon the exercise or conversion of all outstanding options, warrants, convertible or exchangeable securities entitling the holders to purchase, exchange for, or convert into, shares of common stock. This would result in approximately the same aggregate price being required to be paid under such options, warrants, convertible or exchangeable securities upon exercise, and approximately the same value of shares of common stock being delivered upon such exercise, exchange or conversion, immediately following the Inpixon Reverse Stock Split as was the case immediately preceding such split. The number of shares deliverable upon settlement or vesting of restricted stock awards will be similarly adjusted, subject to our treatment of fractional shares. The number of shares reserved for issuance pursuant to these securities will be proportionately based upon the ratio determined by the Inpixon Board, subject to our treatment of fractional shares.

The number of shares available under Inpixon’s 2018 Employee Stock Incentive Plan will not be adjusted in connection with the Inpixon Reverse Stock Split. Accordingly, following the effective time of the Inpixon Reverse Stock Split, there will be an increase in the number of available shares of our common stock available for future awards.

Additional shares of common stock, if issued in connection with an equity award, would have a dilutive effect upon the percentage of equity of Inpixon owned by our present stockholders.

Accounting Matters

The amendment to Inpixon’s Articles of Incorporation will not affect the par value of our common stock per share, which will remain $0.001 par value per share. As a result, the stated capital attributable to common stock and the additional paid-in capital account on our balance sheet will not change due to the Inpixon Reverse Stock Split. Reported per share net income or loss will be higher because there will be fewer shares of common stock outstanding.

Effective Date

The Inpixon Reverse Stock Split would become effective upon the filing of a Certificate of Amendment to our Articles of Incorporation with the office of the Secretary of State of the State of Nevada or at such later date as is specified in such filing. On the effective date, shares of common stock issued and outstanding, in each case, immediately prior thereto, will be combined and converted, automatically and without any action on the part of the stockholders, into new shares of common stock in accordance with the ratio determined by the Inpixon Board within the limits set forth in this proposal. We expect to effect the Inpixon Reverse Stock Split immediately prior to the closing of the merger with XTI.

No Going Private Transaction

Notwithstanding the decrease in the number of outstanding shares of common stock following the implementation of the Inpixon Reverse Stock Split, the Inpixon Board does not intend for this transaction to be the first step in a “going private transaction” within the meaning of Rule 13e-3 of the Exchange Act and the implementation of the proposed Inpixon Reverse Stock Split will not cause Inpixon to go private.

Treatment of Fractional Shares

No fractional shares would be issued if, as a result the Inpixon Reverse Stock Split, a registered stockholder would otherwise become entitled to a fractional share. Rather, either (i) fractional shares that would be created as a result of the Inpixon Reverse Stock Split will be rounded upward to the nearest whole share, or (ii) stockholders will receive cash equal to the market value of the fractional share, determined by multiplying such fraction by the closing sales price of the Common stock as reported on the Nasdaq on the last trading day before the effective date of the Inpixon Reverse Stock Split (as adjusted to give effect to the Inpixon Reverse Stock Split), with such determination regarding the treatment of fractional shares to be made by the Inpixon Board in its sole discretion prior to effecting the Inpixon Reverse Stock Split. The ownership of a fractional share will not give a stockholder any voting, dividend or other right except, to the extent the Inpixon Board decides to pay cash in lieu of fractional shares, the right to receive the cash payment therefor. If a stockholder is entitled to a cash payment in lieu of any fractional share, a check will be mailed to the stockholder’s registered address as soon as practicable after the effective date of the Inpixon Reverse Stock Split. By signing and cashing the check, stockholders will warrant that they owned the shares of common stock for which they received such cash payment. To the extent the Inpixon Board decides to round up fractional shares, share interests issued due to rounding will be given solely to save the expense and inconvenience of issuing fractional shares of common stock and will not represent separately bargained for consideration.

Book-Entry Shares

If the Inpixon Reverse Stock Split is effected, stockholders who hold uncertificated shares (i.e., shares held in book-entry form and not represented by a physical share certificate), either as direct or beneficial owners, will have their holdings electronically adjusted by Inpixon’s transfer agent (and, for beneficial owners, by their brokers or banks that hold in “street name” for their benefit, as the case may be) to give effect to the Inpixon Reverse Stock Split.

Stockholders who hold uncertificated shares as direct owners will be sent a statement of holding from Inpixon’s transfer agent that indicates the number of shares owned in book-entry form.

Certificated Shares

If the Inpixon Reverse Stock Split is effected, stockholders holding certificated shares (i.e., shares represented by one or more physical share certificates) will receive a transmittal letter from Inpixon’s transfer agent promptly after the effectiveness of the Inpixon Reverse Stock Split. The transmittal letter will be accompanied by instructions specifying how stockholders holding certificated shares can exchange certificates representing the pre-split shares for a statement of holding.

Beginning after the effectiveness of the Inpixon Reverse Stock Split, each certificate representing shares of our pre-split common stock will be deemed for all corporate purposes to evidence ownership of post-split Common stock.

STOCKHOLDERS SHOULD NOT DESTROY ANY PRE-SPLIT STOCK CERTIFICATE AND SHOULD NOT SUBMIT ANY CERTIFICATES UNTIL THEY ARE REQUESTED TO DO SO.

Possible Effects of Additional Issuances of Common Stock and History of Prior Inpixon Reverse Stock Splits

Following the effective time of the Inpixon Reverse Stock Split, there will be an increase in the number of authorized but unissued shares of our common stock. Under the NRS, the Inpixon Board can issue additional shares of common stock without further vote of our stockholders except as may be required in particular cases by our Articles of Incorporation, the NRS or other applicable law, regulatory agencies or Nasdaq Listing Rules. Stockholders do not have preemptive rights to subscribe to additional securities that we may issue, which means that current stockholders do not have a prior right thereunder to purchase any new issue of common stock, or securities that are convertible into common stock, in order to maintain their proportionate ownership interests in Inpixon.

Additional shares of common stock, if issued, would have a dilutive effect upon the percentage of equity of Inpixon owned by our stockholders. The issuance of such additional shares of common stock might be disadvantageous to current stockholders in that any additional issuances would potentially reduce per share dividends, if any. Stockholders should consider, however, that the possible impact upon dividends is likely to be minimal in view of the fact that Inpixon does not intend to pay any cash dividends on its common stock in the foreseeable future. In addition, the issuance of such additional shares of common stock, by reducing the percentage of equity of Inpixon owned by present stockholders, would reduce such present stockholders’ ability to influence the election of directors or any other action taken by the holders of common stock.

In the future the Inpixon Board could, subject to its fiduciary duties and applicable law, use the increased number of authorized but unissued shares of common stock to frustrate persons seeking to take over or otherwise gain control of our Company by, for example, privately placing shares with purchasers who might side with the Inpixon Board in opposing a hostile takeover bid. Shares of common stock could also be issued to a holder that would thereafter have sufficient voting power to assure that any proposal to amend or repeal Inpixon’s bylaws or Articles of Incorporation would not receive the requisite vote. Such uses of the common stock could render more difficult, or discourage, an attempt to acquire control of Inpixon if such transactions were opposed by the Inpixon Board. A result of the anti-takeover effect of the increase in the number of authorized shares of common stock could be that stockholders would be denied the opportunity to obtain any advantages of a hostile takeover, including, but not limited to, receiving a premium to the then current market price of our common stock, if the same was so offered by a party attempting a hostile takeover of our Company. Inpixon is not aware of any party’s interest in or efforts to engage in a hostile takeover attempt as of the date of this proxy statement/prospectus.

Inpixon effected a 1-for-15 reverse stock split of Inpixon’s issued and outstanding shares of common stock on March 1, 2017, a 1-for-30 reverse stock split of Inpixon’s issued and outstanding shares of common stock on February 6, 2018, a 1-for-40 reverse stock split of Inpixon’s issued and outstanding shares of common stock effected on November 2, 2018, a 1-for-45 reverse stock split of Inpixon’s issued and outstanding shares of common stock on January 7, 2020 and a 1-for-75 reverse stock split of Inpixon’s authorized and issued and outstanding shares of common stock effected on October 7, 2022. Inpixon effected these reverse stock splits for the purpose of complying with Nasdaq Listing Rule 5550(a)(2).

Certain Material U.S. Federal Income Tax Consequences of a Reverse Stock Split

The following discussion summarizes certain material U.S. federal income tax consequences relating to the participation in a reverse stock split by a U.S. stockholder who holds the shares as a capital asset. This discussion is based on the provisions of the Code, final, temporary and proposed U.S. Treasury regulations promulgated thereunder and current administrative rulings and judicial decisions, all as in effect as of the date hereof. All of these authorities may be subject to differing interpretations or repealed, revoked or modified, possibly with retroactive effect, which could materially alter the tax consequences set forth herein.

For purposes of this summary, a “U.S. stockholder” refers to a beneficial owner of Common stock who is any of the following for U.S. federal income tax purposes: (i) a citizen or resident of the United States, (ii) a corporation created or organized in or under the laws of the United States, any state thereof, or the District of Columbia, (iii) an

estate the income of which is subject to U.S. federal income taxation regardless of its source, or (iv) a trust if (1) its administration is subject to the primary supervision of a court within the United States and one or more U.S. persons have the authority to control all of its substantial decisions, or (2) it has a valid election in effect under applicable U.S. Treasury regulations to be treated as a U.S. person. A non-U.S. holder of Common stock is a stockholder who is not a U.S. stockholder.

This summary does not represent a detailed description of the U.S. federal income tax consequences to a stockholder in light of his, her or its particular circumstances. In addition, it does not purport to be complete and does not address all aspects of federal income taxation that may be relevant to stockholders in light of their particular circumstances or to any stockholder who may be subject to special tax rules, including, without limitation: (1) stockholders subject to the alternative minimum tax; (2) banks, insurance companies, or other financial institutions; (3) tax-exempt organizations; (4) dealers in securities or commodities; (5) regulated investment companies or real estate investment trusts; (6) traders in securities who elect to use a mark-to-market method of accounting for their securities holdings; (7) U.S. stockholders whose “functional currency” is not the U.S. dollar; (8) persons holding Common stock as a position in a hedging transaction, “straddle,” “conversion transaction” or other risk reduction transaction; (9) persons who acquire shares of common stock in connection with employment or other performance of services; (10) dealers and other stockholders who do not own their shares of common stock as capital assets; (11) U.S. expatriates, (12) foreign persons; (13) resident alien individuals; or (14) stockholders who directly or indirectly hold their stock in an entity that is treated as a partnership for U.S. federal tax purposes. Moreover, this description does not address the U.S. federal estate and gift tax, alternative minimum tax, or other tax consequences of the Inpixon Reverse Stock Split.

There can be no assurance that the Internal Revenue Service (the “IRS”) will not take a contrary position to the tax consequences described herein or that such position will be sustained by a court. In addition, U.S. tax laws are subject to change, possibly with retroactive effect, which may result in U.S. federal income tax considerations different from those summarized below. No opinion of counsel or ruling from the IRS has been obtained with respect to the U.S. federal income tax consequences of the Inpixon Reverse Stock Split.

This discussion is for general information only and is not tax advice. All stockholders should consult their own tax advisors with respect to the U.S. federal, state, local and non-U.S. tax consequences of the Inpixon Reverse Stock Split.

Tax Consequences to Inpixon — We believe that the Inpixon Reverse Stock Split will constitute a reorganization under Section 368(a)(1)(E) of the Code. Accordingly, we should not recognize taxable income, gain or loss in connection with the Inpixon Reverse Stock Split. In addition, we do not expect the Inpixon Reverse Stock Split to affect our ability to utilize our net operating loss carryforwards.

Tax Consequences to Stockholders — Stockholders should not recognize any gain or loss for U.S. federal income tax purposes as a result of the Inpixon Reverse Stock Split, except to the extent of any cash received in lieu of a fractional share of Common stock (which fractional share will be treated as received and then exchanged for cash), to the extent the Inpixon Board decides to pay cash in lieu of any fractional shares. Each stockholder’s aggregate tax basis in the Common stock received in the Inpixon Reverse Stock Split, including any fractional share treated as received and then exchanged for cash, should equal the stockholder’s aggregate tax basis in the Common stock exchanged in the Inpixon Reverse Stock Split. In addition, each stockholder’s holding period for the Common stock it receives in the Inpixon Reverse Stock Split should include the stockholder’s holding period for the Common stock exchanged in the Inpixon Reverse Stock Split.

In general, a stockholder who receives cash in lieu of a fractional share of Common stock pursuant to the Inpixon Reverse Stock Split should be treated for U.S. federal income tax purposes as having received a fractional share pursuant to the Inpixon Reverse Stock Split and then as having received cash in exchange for the fractional share and should generally recognize capital gain or loss equal to the difference between the amount of cash received and the stockholder’s tax basis allocable to the fractional share. Any capital gain or loss will generally be long term capital gain or loss if the stockholder’s holding period in the fractional share is greater than one year as of the effective date of the Inpixon Reverse Stock Split. Special rules may apply to cause all or a portion of the cash received in lieu of a fractional share to be treated as dividend income with respect to certain stockholders who own more than a minimal amount of Common stock (generally more than 1%) or who exercise some control over the affairs of Inpixon. Stockholders should consult their own tax advisors regarding the tax effects to them of receiving cash in lieu of fractional shares based on their particular circumstances.

THE PRECEDING DISCUSSION IS INTENDED ONLY AS A SUMMARY OF CERTAIN FEDERAL INCOME TAX CONSEQUENCES OF THE INPIXON REVERSE STOCK SPLIT AND DOES NOT PURPORT TO BE A COMPLETE ANALYSIS OR DISCUSSION OF ALL POTENTIAL TAX EFFECTS RELEVANT THERETO. YOU SHOULD CONSULT YOUR OWN TAX ADVISORS AS TO THE PARTICULAR FEDERAL, STATE, LOCAL, FOREIGN AND OTHER TAX CONSEQUENCES OF THE INPIXON REVERSE STOCK SPLIT IN LIGHT OF YOUR SPECIFIC CIRCUMSTANCES.

No Right of Dissent or Appraisal

Under NRS 92A.300 to 92A.500, inclusive, under certain circumstances, stockholders of a Nevada corporation may be entitled to dissent and demand payment of the fair value of such stockholder’s shares in the event of certain corporate actions, including reverse stock splits of a class or series held without correspondingly decreasing the number of authorized shares of the same class or series if money will be paid or scrip will be issued to stockholders who in the aggregate hold one percent or more of the outstanding shares of the affected class or series, and would otherwise be entitled to receive a fraction of a share in the exchange of their outstanding shares.

However, there is no such right of dissent for holders of a class or series of stock that is a “covered security” under Section 18(b)(1)(A) or (B) of the Securities Act. Inpixon’s common stock is listed on the Nasdaq Capital Market, a national securities exchange, making it a “covered security” within the meaning of Section 18(b)(1)(A) of the Securities Act. Therefore, the holders of common stock will not have the right under the NRS to dissent from, or demand payment for their shares in connection with, Proposal One, and we will not independently provide our stockholders with such a right.

Vote Required

The affirmative vote of a majority of the votes cast by the holders of Inpixon common stock present virtually or by proxy at the Inpixon special meeting and entitled to vote on the matter is required for approval of the Reverse Split Ratio Proposal. Abstentions and broker non-votes will have no effect on this proposal. Brokers generally have discretionary authority to vote on the amendment to our Articles of Incorporation to effect a reverse stock split of our outstanding common stock, thus, broker non-votes are not expected to result from the vote on this proposal.

Recommendation of Inpixon Board

THE INPIXON BOARD RECOMMENDS THAT INPIXON STOCKHOLDERS VOTE “FOR” THE REVERSE SPLIT RATIO PROPOSAL TO APPROVE THE INCREASE TO THE PREVIOUSLY APPROVED MAXIMUM REVERSE STOCK SPLIT RATIO OF 1-FOR-50 TO 1-FOR-200.

any adjourned session of the Inpixon special meeting and use the additional time to solicit additional proxies, including the solicitation of proxies from Inpixon Stockholders that previously have returned properly executed proxies or authorized a proxy by using the Internet or telephone. Among other things, approval of the Adjournment Proposal could mean that, even if Inpixon has received proxies representing a sufficient number of votes against the approval of the Nasdaq Stock Issuance Proposal, the Director Election Proposal, the Authorized Share Increase Proposal, the Reverse Split Ratio Proposal and the Potential Financing Issuances Proposal, Inpixon could adjourn the Inpixon special meeting without a vote on such proposal and seek to obtain sufficient votes in favor of any such proposal to obtain approval of that proposal.

Inpixon currently does not intend to propose adjournment at the Inpixon special meeting if there are sufficient votes to approve the Nasdaq Stock Issuance Proposal, the Director Election Proposal, the Authorized Share Increase Proposal, the Reverse Split Ratio Proposal and the Potential Financing Issuances Proposal.

Vote Required

The affirmative vote of a majority of the votes cast by the holders of Inpixon common stock present virtually or by proxy at the Inpixon special meeting and entitled to vote on the matter is required for approval of the Adjournment Proposal. Abstentions and broker non-votes will have no effect on this proposal.

Recommendation of Inpixon Board

THE INPIXON BOARD RECOMMENDS THAT INPIXON STOCKHOLDERS VOTE “FOR” THE ADJOURNMENT PROPOSAL TO ADJOURN THE INPIXON SPECIAL MEETING, IF NECESSARY, TO SOLICIT ADDITIONAL PROXIES IF THERE ARE NOT SUFFICIENT VOTES IN FAVOR OF THE NASDAQ STOCK ISSUANCE PROPOSAL, THE DIRECTOR ELECTION PROPOSAL, THE AUTHORIZED SHARE INCREASE PROPOSAL, THE REVERSE SPLIT RATIO PROPOSAL OR THE POTENTIAL FINANCING ISSUANCES PROPOSAL.

INPIXON BUSINESS

Unless the context otherwise requires, all references in this “Inpixon Business” section to “we,” “us,” “Inpixon,” “our” and the “Company” refer to Inpixon prior to the consummation of the merger.

Introduction

Inpixon is the Indoor Intelligence™ company. Our solutions and technologies help organizations create and redefine exceptional experiences that enable smarter, safer and more secure environments. Inpixon customers can leverage our real-time positioning, and analytics technologies to achieve higher levels of productivity and performance, increase safety and security, and drive a more connected work environment.

Inpixon specializes in providing real-time location systems (RTLS) for the industrial sector. As the manufacturing industry has evolved, RTLS technology has become a crucial aspect of Industry 4.0. Our RTLS solution leverages cutting-edge technologies such as IoT, AI, and big data analytics to provide real-time tracking and monitoring of assets, machines, and people within industrial environments. With our RTLS, businesses can achieve improved operational efficiency, enhanced safety and reduced costs. By having real-time visibility into operations, industrial organizations can make informed, data-driven decisions, minimize downtime, and ensure compliance with industry regulations. With our RTLS, industrial businesses can transform their operations and stay ahead of the curve in the digital age.

Inpixon’s full-stack industrial IoT solution provides end-to-end visibility and control over a wide range of assets and devices. It’s designed to help organizations optimize their operations and gain a competitive edge in today’s data-driven world. The turn-key platform integrates a range of technologies, including RTLS, sensor networks, edge computing, and big data analytics, to provide a comprehensive view of an organization’s operations. We help organizations to track the location and status of assets in real-time, identify inefficiencies, and make decisions that drive business growth. Our IoT stack covers all the technology layers, from the edge devices to the cloud. It includes hardware components such as sensors and gateways, a robust software platforms for data management and analysis, and a user-friendly dashboard for real-time monitoring and control. Our solutions also offer robust security features, to help ensure the protection of sensitive data. Additionally, Inpixon’s RTLS provides scalability and flexibility, allowing organizations to easily integrate it with their existing systems and add new capabilities as their needs evolve.

In addition to our Indoor Intelligence technologies and solutions, we also offer:

•        Digital solutions (eTearsheets; eInvoice, adDelivery) or cloudbased applications and analytics for the advertising, media and publishing industries through our advertising management platform referred to as Shoom by Inpixon; and

•        A comprehensive set of data analytics and statistical visualization solutions for engineers and scientists referred to as SAVES by Inpixon.

We report financial results for three segments: Indoor Intelligence, Shoom and SAVES. For Indoor Intelligence, we generate revenue from sales of hardware, software licenses and professional services. For Shoom and SAVES we generate revenue from the sale of software licenses.

Products and Services

Indoor Intelligence

Our Indoor Intelligence offerings consist of the following software and hardware products.

•        Industrial RTLS SaaS Platform — Our full stack offering in the Industrial IoT space includes an enterprise class, multi-technology RTLS IoT platform for industrial automation. Inpixon’s RTLS IoT platform is a comprehensive real-time IoT solution for the implementation of industrial RTLS (track & trace) applications for indoor and outdoor areas, such as vehicle localization, production tracking, yard management, gate allocation, forklift location (MHE), real-time route optimization, and the automatic identification (AutoID)

and booking of goods and material flows. In addition to real-time data applications for the digital twin, it also provides smart real-time location analyses from a single platform suite, enabling companies to identify significant process optimizations and make data-based decisions. Prebuilt modules offered within the platform include smart factory, smart warehouse, inventory manager, shipment manager, and yard manager. The digital twin of a physical space facilitates use cases for facility management, security safety, customer or worker experiences, asset tracking and more.

•        IoT Devices, Sensors and Tags — Our RTLS asset tracking hardware includes a full end-to-end portfolio of IoT sensors (also known as nodes or anchors) and tracking tags to track assets or personnel. This portfolio leverages our own products for ultra-wideband (UWB) and chirp spread spectrum (CSS) and GPS while incorporating support for third party integrated BLE, RFID and LiDAR solutions. In the security space, a version of our sensor enables detection of cellular, Wi-Fi and BLE signals that is combined with UWB to offer security and high value asset tracking solutions. Chirp technology is effective for longer range communication while UWB is an important RF standard for pinpoint asset tracking. Organizations across many different industries can leverage the accuracy, low-latency, and reliability of both technologies to track the real-time location and status of key assets and equipment, with precision. Users can display and track the static location and movement of assets and asset attribute information within a space on indoor maps.

•        Transceivers/Modules — The Inpixon nanoLOC transceiver is a low-power, highly integrated mixed-signal chip. This 2.4 GHz long range CSS transceiver transmits and receives wireless data packets for robust wireless communications, ranging capabilities, and real-time location determination. Inpixon’s chirp leverages a patented, Inpixon-owned technology and offers range comparable to Wi-Fi systems with accuracy of BLE or UWB in some scenarios. Supporting a freely adjustable center frequency with three non-overlapping frequency channels, amongst others, the Inpixon nanoLOC enables multiple physically independent networks and improved coexistence with existing 2.4 GHz wireless technologies. This product is also available in a module form to allow easier integration for our partners and integrators.

•        Video Integration — Our RF video solution uses IoT analytics data and allows direct integration with leading Video Management Systems (VMS) and CCTV to provide visual track and trace of assets or to quickly allow video to aid security personnel in an emergency situation. This solution builds upon the accurate mapping solutions while adding analytics and precise RTLS data.

•        Analytics and Insights — Our cloud-based analytics platform allows data from multiple sensors and data sources to be visualized for action by the customer. Our platforms can engage with data from our IoT sensors, mobile apps, third-party sensors and data that is ingested via an application programming interface (API) or data import. Analytics enable, for instance, factory operators to visualize and analyze the flow of products through the facility to address bottlenecks and improve efficiency and productivity.

•        Augmented Reality (AR) and 3D — Our augmented reality solutions allow us to easily scan a space and subsequently attach AR content persistently to any position in the world. The technology can also be used for visual asset tracking without beacons or markers as well as digital twin creation and manipulation. Using SLAM combined with innovative technologies offers tools to help enable augmented reality and metaverse capabilities for their business.

•        Wireless Device Detection for Security — Our wireless detection and positioning solutions help cultivate situational awareness and identify security risks by leveraging sensors with proprietary technology that can detect and position active cellular, Wi-Fi, Bluetooth, and UWB signals throughout a venue. This solution allows for the positioning of people and assets homogeneously as they travel in a controlled space and empowers customers to make key decisions around security, risk mitigation and public safety, at scale. Utilizing various radio signal technologies permits device positioning with accuracy ranging from several meters down to approximately thirty centimeters, depending on the product deployed and conditions in the indoor space. The technology allows for detailed understanding of space and resource utilization, and in security applications it enables detection and identification of authorized and unauthorized devices, prevention of rogue devices through alerts based on rules when unknown devices are detected in restricted areas and asset tracking with centimeter level precision.

•        Enterprise Apps — Our indoor intelligence segment for the reporting period covered by this report also includes the smart office app, events and mapping solution which comprised the enterprise apps line of products offering enhanced employee experiences with a holistic location aware customer branded employee app for a smart, innovative and connected workplace. This suite of products and solutions was spun off in connection with the separation of our enterprise apps business effective as of March 14, 2023. (See “Corporate History” below and “Recent Events — Enterprise Apps Spin-off and Business Combination” under Part II, Item 7 herein for more information).

Shoom

With Shoom Digital Solutions we offer comprehensive digital solutions or cloud-based applications and analytics for the media and publishing industry, including eTearsheets and eInvoice. eTearsheets provides both advertiser and publication users with an advertising analytics tool kit for accessing single ads or entire campaigns across multiple publications. eTearsheets seamlessly with existing PDF workflows, merging users PDF pages with ad data, creating links to the ads, and sending an option e-mail to advertisers containing a link to their ad pages. Users can access the site on their desktop, tablet or mobile devices, and need only internet access and a standard browser. eInvoice is a hosted, web-based solution offering email notifications, seamless interaction with eTearsheets and dynamic invoice searching.

SAVES

Through our SAVES product line we offer a comprehensive set of data analytics and statistical visualization software solutions for engineers and scientists. The suite of data analytics and statistical visualization tools includes SigmaPlot, SigmaStat, SYSTAT, PeakFit, TableCurve 2D, TableCurve 3D, SigmaScan and MYSTAT.

Product Enhancements

Our ability to adapt to the technological advancements within our industry is critical to our long-term success and growth. As a result, our executive management must continuously work to ensure that they remain informed and prepared to quickly adapt and leverage new technologies within our product and service offering as such technologies become available. In connection with that goal, our product roadmap development plans include expanding the use of both UWB and CSS technology for precise asset tracking, furthering our efforts towards 3D mapping, with a specific focus on light detection and ranging (LiDAR) and AR features, innovation in our machine learning algorithms for our positioning engines, and understanding worldwide 5G deployments to enhance our detection and positioning capabilities.

Positioning Innovation Powered by Machine Learning

In 2023, we intend to continue to expand our use of machine learning and artificial intelligence (“AI”) to improve positioning accuracy, reliability and range which would provide additional benefits to existing customers and unlock new opportunities for our technology. Following these enhancements, we believe our products will be able to assist in providing predictive, more accurate, bidirectional location information to secure and optimize our deployments using hardware that includes iOS and Android smartphones, IoT sensors, access points or BLE beacons.

5G

Building on research and development (R&D) efforts in 2022, we intend to continue to study the worldwide 5G deployments, both public and private, to identify a robust hardware and software solution to detect and position new handsets based on this technology and explore software defined radio solutions, as well as enhancements in antenna technology to provide our customers with additional capabilities in the security field. This is a complex challenge and we are working with partners and customers to understand requirements, use cases and solutions.

Analytics and Insights

Inpixon Analytics on-premises or in the cloud, along with specially-optimized algorithms and industry specific dashboards that are intended to provide better visibility, predictive maintenance, process optimization, security and safety, and data-driven decision-making. Improved visibility gives real-time locations and status of assets, people, and equipment both indoors and outdoors. By collecting and analyzing data from RTLS systems, organizations

gain insights from asset movements and use this information to optimize their operations. Predictive maintenance reduces downtime and maintenance costs, as well as improve the lifespan of equipment. Process optimization helps improve productivity, reduce costs, and enhance customer satisfaction. Security and safety helps prevent accidents, reduce the risk of theft, and enhance the overall safety of employees and customers. Data-driven decision making by analyzing data from RTLS systems, organizations gains a better understanding of their operations, identify areas for improvement, and make data-driven decisions that drive business value.

Augmented Reality and Digital Twin

Inpixon AR and digital twin technologies multiplies the capabilities of RTLS solutions by providing real-time visualization aided with meta data, remote monitoring, simulation and testing, predictive maintenance, collaboration, and training, all of which can help optimize operations and improve efficiency. AR helps visualize the real-time location of assets, people, and equipment in the physical world, overlaid with digital information such as asset status, maintenance history, and other relevant data. This can provide a more intuitive and efficient way for operators to understand and interact with the physical world. In addition, digital twin features can enable remote monitoring of assets and equipment, providing a virtual representation of the physical world that can be accessed from anywhere to monitor assets and equipment in real-time and make informed decisions based on the data gathered. Digital twin technology can also enable simulation and testing of scenarios in a virtual environment, allowing our customers to test different configurations and optimize their operations without the need for physical experimentation. Finally, AR and digital twin technologies can facilitate collaboration and training by providing a shared virtual environment where operators can train and work together remotely.

Corporate Strategy

In order to continue to respond to rapid changes and required technological advancements, as well as increase our shareholder value, we are exploring strategic transactions and opportunities that we believe will enhance shareholder value. Our board of directors has authorized a review of strategic alternatives, including a possible asset sale, merger with another company or spin-off of one or more of our business units. We will also be opportunistic and may consider other strategic and/or attractive transactions, which may include, but not be limited to other alternative investment opportunities, such as minority investments, joint ventures or special purpose acquisition companies. If we make any acquisitions in the future, we expect that we may pay for such acquisitions with cash, equity securities and/or debt in combinations appropriate for each acquisition. In September of 2022, we entered into an Agreement and Plan of Merger in connection with the spin-off and sale of our enterprise apps business which was consummated on March 14, 2023. (See “Corporate History” below and “Recent Events — Enterprise Apps Spin-off and Business Combination” under Part II, Item 7 herein for more details). In addition, we have entered into an Agreement and Plan of Merger with XTI on July 24, 2023 in connection with a proposed merger with XTI. Additionally, we expect to divest our Shoom, SAVES and Game Your Game lines of business by contributing the relevant assets and liabilities to a wholly-owned subsidiary and sell the equity interests in the subsidiary to an affiliated party following the merger.

Research and Development Expenses

Our future plans include investments in research and development and related product enhancement opportunities. Our management believes that we must continue to dedicate a significant amount of resources to research and development efforts to maintain a competitive position. Our products intersect many emerging fields including metaverse, augmented reality, occupancy planning, industry 4.0, smart cities, and more, and we continue to innovate and patent new methods to solve problems for our customers. Research and development expenses for the years ended December 31, 2022 and 2021 totaled approximately $17.7 million and $14.1 million, respectively.

Sales and Marketing

Inpixon sales channels include direct sales as well as indirect sales through channel partners including original equipment manufacturers (OEMs), integrators, resellers and distributors. Indirect sales partners may provide a range of pre- and post-sales services to Inpixon customers including system design, installation, commissioning and service.

Direct sales representatives are compensated with a base salary and, in certain circumstances, may participate in incentive plans such as commissions or bonuses.

Inpixon markets its products through industry-focused as well as account-based marketing strategies which utilize SEO, advertising, social media, trade shows, conferences, webinars and other media.

Our Inpixon products are primarily sold on a license (up-front one-time fee) or SaaS model. In our licensing model, we also typically charge an annual maintenance fee. The SaaS model is typically for a 2-3 year contract and includes maintenance upgrades. The SaaS model generates a recurring revenue stream. Our Shoom product is on a monthly subscription model based on 2-3 year contracts. SAVES products are sold as annual or perpetual licenses along with maintenance subscriptions.

Customers

Inpixon’s RTLS offerings which include real-time location tracking, collision avoidance and wireless device detections are used around the world in automotive factories, heavy equipment factories, logistics and distribution warehouses, mining operations, government and military buildings, and corporate offices. Shoom solutions customers are primarily found in the advertising, media and publishing industries. SAVES solutions are used by engineers and scientists in a variety of industries including environmental sciences, behavioral sciences, medical research and engineering.

Our top three customers accounted for approximately 19% and 16% of our gross revenue during the years ended December 31, 2022 and 2021, respectively. During 2022 no customer accounted for more than 10% of our gross revenue, and two customers accounted for 7% of our gross revenue in 2022 and one customer accounted for 8% of our gross revenue in 2021. From time to time, one or two customers can represent a significant portion of our revenue as a result of one-time projects.

Competition

Our business is characterized by innovation and rapid change. Our RTLS Indoor Intelligence products compete with companies such as Aruba, Cisco, Juniper Networks/Mist Systems, Ubisense, Sewio, Kinexon, Zebra Technologies and other mostly vertical focused RTLS companies. Some competitors determine positioning primarily using BLE or Wi-Fi and, therefore, we believe they cannot achieve the same accuracy that we do and so cannot meet some customers’ needs. Many Inpixon competitors are focused on one technology and/or vertical and, at this time, we believe none of them have as complete an offering of tags, anchors, positioning, engine, software, integrations and analytics.

We believe we offer a unique and differentiated approach to the market with our industrial RTLS which is:

•        Comprehensive.    We offer full-stack RTLS solutions which seamlessly integrates tracking tags, anchors, sensors, positioning engine, software, and connections to third-party systems. We integrate a myriad of indoor data inputs and outputs. With a single platform we can support a multitude of use cases across numerous industries in both the private and public sector.

•        Scalable.    Our solutions are built to support customers’ expanding needs and use cases. Unlike many other competitive point-solutions, we can offer expansion paths and support for a wide variety of location-based use cases at large, multi-size, global enterprises. Our multi-layered depiction of indoor data allows users to see the information most relevant to their role, in the optimal format for them (e.g., charts, tables, maps, etc.).

•        Technology-agnostic and open.    We embrace an ecosystem of hardware, software, integration and distribution partners welcoming integration and synchronization with third party data and systems in combination with our platform. Our open architecture is designed to enable the integration of disparate technologies, preserve investment and avoid obsolescence. APIs and MQTT make it possible to move data in and out of our platform to enable a plethora of opportunities and benefits.

MerlinOne and PressTeligence compete with the functionality of our Shoom products, but typically provide information only for the specific customer and not for the customer’s competitors or for the industry.

Originlab and Graphpad Prism are the main competitors of our SAVES products.

Intellectual Property

To establish and protect our proprietary rights, we rely on a combination of patents, trademarks, copyrights, trade secrets, including know-how, license agreements, confidentiality procedures, non-disclosure agreements with third parties, employee disclosure and invention assignment agreements, and other contractual rights. We do not believe that our proprietary technology is dependent on any single patent or copyright or groups of related patents or copyrights. We believe the duration of our patents is adequate relative to the expected lives of our products.

Our SAVES products are sold pursuant to an exclusive, world-wide, fully transferable, royalty free, 15 year (“License Term”) license and distribution agreement (the “Systat License Agreement”) with Cranes Software International Ltd. (“Cranes”) and Systat Software, Inc. (“Systat” and together with Cranes, the “Systat Parties”) pursuant to which we were granted (a) an exclusive, worldwide license to use, modify, develop, market and distribute the SYSTAT software suite of products related source code, user documentation and associated intellectual property and (b) an exclusive, worldwide sub-license to use, modify, develop, market and distribute the Sigma Plot suite of software, related source code, user documentation and associated intellectual property licensed to Systat by Cranes. In addition, we were also granted with an exclusive, worldwide, fully transferable, royalty free license to create derivative works and improvements, modifications, enhancements, changes, or corrections to the underlying software, source code and documentation during the License Term (“Modification”). We own title to any Modifications.

In connection with the Enterprise Apps Spin-off and the terms of the KINS Separation Agreement (defined below), each of Inpixon and CXApp have granted the other party a limited worldwide, non-exclusive, irrevocable, royalty free, fully paid up, perpetual license (the “Licensee”) to use, practice and otherwise exploit such intellectual property (with certain exceptions) that is owned, controlled or purported to be owned or controlled by the other party (the “Licensor”) to the extent used, practiced or otherwise exploited in the business of the Licensee during the twelve (12) months prior to the separation or is reasonably anticipated to be used after the separation for the conduct of any business of the Licensee as conducted on or prior to the separation and reasonably anticipated extension or evolutions thereof that are not substitutes for any product or service of the Licensor.

Government Regulation

In general, we are subject to numerous federal, state and foreign legal requirements on matters as diverse as data privacy and protection, employment and labor relations, immigration, taxation, anticorruption, import/export controls, trade restrictions, internal and disclosure control obligations, securities regulation and anti-competition.

Violations of one or more of these diverse legal requirements in the conduct of our business could result in significant fines and other damages, criminal sanctions against us or our officers, prohibitions on doing business and damage to our reputation. Violations of these regulations or contractual obligations related to regulatory compliance in connection with the performance of customer contracts could also result in liability for significant monetary damages, fines and/or criminal prosecution, unfavorable publicity and other reputational damage, restrictions on our ability to compete for certain work and allegations by our customers that we have not performed our contractual obligations. To date, compliance with these regulations has not been financially burdensome.

Employees

As of October 24, 2023, we have 97 employees, including 6 part-time employees, which includes all employees of our subsidiaries. This includes 3 officers, 17 sales personnel, 6 marketing personnel, 51 technical and engineering personnel and 14 finance, legal and administration personnel.

Corporate History

We were originally formed in the State of Nevada in April 1999. Prior to the spin-off in August 2018 of our wholly-owned subsidiary, Sysorex, Inc. (“Sysorex”), our business was primarily focused on providing information technology and telecommunications solutions and services to commercial and government customers primarily in the United States. The product and service offerings included enterprise infrastructure solutions for business operations, continuity, data protection, software development, collaboration, IT security, and physical security needs, including, third party hardware, software and related maintenance and warranty products and services resold from well-known brands and information technology development and implementation professional services.

On August 31, 2018, we completed the spin-off of Sysorex to separate our legacy enterprise infrastructure solution business from our indoor intelligence business.

On May 21, 2019, we completed the acquisition of 100% of the outstanding capital stock of Locality Systems, Inc. (“Locality”), including its wireless device positioning and RF augmentation of video surveillance systems through our subsidiary, Inpixon Canada. The video management system (“VMS”) integration, which is currently available for a number of VMS vendors, can assist security personnel in identifying potential suspects and tracking their movements cross-camera and from one facility to another. The solution is designed to enhance traditional security video feeds by correlating RF signals with video images.

On June 27, 2019, we acquired a portfolio of GPS technologies and IP, including, but not limited to (a) an IP portfolio that includes a registered patent, along with more than 20 pending patent applications or licenses to registered patents or pending applications relating to GPS technologies; (b) a smart school safety network solution that consists of a combination of wristbands, gateways and proprietary backend software, which rely on the Bluetooth Low-Energy protocol and a low-power enterprise wireless 2.4Ghz platform, to help school administrators identify the geographic location of students or other people or things (e.g., equipment, vehicles, tools, etc.) in order to, among other things, ensure the safety and security of students while at school; (c) a personnel equipment tracking system and ground personnel safety system, which includes a combination of hardware and software components, for a GPS and RF based personnel, vehicle and asset-tracking solution designed to provide ground situational awareness and near real-time surveillance of personnel and equipment traveling within a designated area for, among other things, government and military applications and (d) a right to 30% of royalty payments that may be received by GTX in connection with its ownership interest in Inventergy LBS, LLC, which is the owner of certain patents related to methods and systems for communicating with a tracking device.

On August 15, 2019, we acquired our Inpixon Mapping product in connection with the acquisition of Jibestream, Inc. (“Jibestream”) which was amalgamated into Inpixon Canada on January 1, 2020.

On October 31, 2019, we received stockholder approval for, and subsequently effected, a reverse split of our outstanding common stock at a ratio of 1-for-45, effective as of January 7, 2020 for the purpose of complying with Nasdaq Listing Rule 5550(a)(2).

On June 19, 2020, we acquired an exclusive license to use, market, distribute, and develop the SYSTAT and SigmaPlot software suite of products (referred to as “SAVES”) pursuant to an Exclusive Software License and Distribution Agreement, by and among the Company, Cranes Software International Ltd. (“Cranes”) and Systat Software, Inc. (“Systat” and, together with Cranes, the “Systat Parties”), as amended on June 30, 2020 and February 22, 2021 (as amended, the “License Agreement”). In connection with the License Agreement, we received an exclusive, worldwide license to use, modify, develop, market, sublicense and distribute the SAVES software, software source, user documentation and related Systat Intellectual Property (as defined in License Agreement) (the “License”); and an option to acquire the assets underlying the License (the “Purchase Option”). On February 22, 2021, we exercised the Purchase Option for a portion of the assets including certain of the SAVES software, trademarks, solutions, domain names and websites.

On August 19, 2020, we entered into an agreement with Ten Degrees Inc. (“TDI”), Ten Degrees International Limited (“TDIL”), mCube International Limited (“MCI”), and the holder of a majority of the outstanding capital of TDIL and mCube, Inc., and the sole shareholder of 100% of the outstanding capital stock of MCI (“mCube,” together with TDI, TDIL, and MCI collectively, the “Transferors”) to acquire a suite of on-device “blue-dot” indoor location and motion technologies, including patents, trademarks, software and related intellectual property from the Transferors.

On October 6, 2020, we acquired all of the outstanding shares of Nanotron (“Nanotron Shares”) through our wholly-owned subsidiary Inpixon GmbH, pursuant to a Share Sale and Purchase Agreement with Nanotron Technologies GmbH, a limited liability company incorporated under the laws of Germany (“Nanotron”), and Sensera Limited (“Sensera”), the sole shareholder of Nanotron. As a result of the acquisition, our asset tracking and RTLS business expanded to include offering wireless location awareness technology for consumers, for solutions such as locating and tracking a pet, livestock, child, or property, while transmitting the data into a useable format.

On March 25, 2021, we entered into a Stock Purchase Agreement (the “GYG Purchase Agreement”) with Game Your Game, Inc., a Delaware corporation (“GYG”), and certain selling shareholders (the “Selling Shareholders”), pursuant to which we acquired an aggregate of 522,000 shares of common stock of GYG (the “GYG Shares”), representing 55.4% of the outstanding shares of common stock of GYG. GYG’s business consists of developing and providing solutions using sports data and analytics.

On April 23, 2021 we entered into an asset purchase agreement (the “Asset Purchase Agreement”) with Visualix GmbH i.L. (the “Visualix”), its founders (each, a “Founder,” and collectively, the “Founders”), and Future Energy Ventures Management GmbH (“FEVM”) pursuant to which we acquired substantially all of the Visualix assets including certain computer vision, robust localization, large-scale navigation, mapping, and 3D reconstruction technologies (collectively, the “AR Technology”), the intellectual property and patent applications underlying the AR Technology.

On April 30, 2021, we acquired over 99.9% of the outstanding capital stock of Design Reactor, Inc., a California corporation (“The CXApp”), the provider of a leading SaaS app platform that enables corporate enterprise organizations to provide a custom-branded, location-aware employee app focused on enhancing the workplace experience and hosting virtual and hybrid events pursuant to the terms of a Stock Purchase Agreement. On May 10, 2021, we acquired the remaining interest of The CXApp.

On December 9, 2021, through our wholly-owned subsidiary, Nanotron Technologies GmbH, a limited liability company incorporated under the laws of Germany, we entered into a Share Sale and Purchase Agreement (the “Purchase Agreement”) with the shareholders of IntraNav GmbH, a limited liability company incorporated under the laws of Germany (“IntraNav”), pursuant to which we acquired 100% of the outstanding capital stock (the “IntraNav Shares”) of IntraNav, a leading industrial IoT (“IIoT”), real-time location system (“RTLS”), and sensor data services provider.

On September 25, 2022, we entered into an Agreement and Plan of Merger (the “KINS Merger Agreement”) by and among Inpixon, KINS Technology Group Inc., a Delaware corporation (renamed CXApp Inc., “KINS” or “New CXApp”), CXApp Holding Corp., a Delaware corporation and wholly-owned subsidiary of New CXApp (formerly a wholly-owned subsidiary of Inpixon, “CXApp”), and KINS Merger Sub Inc., a Delaware corporation and a wholly-owned subsidiary of KINS (“KINS Merger Sub”), pursuant to which KINS would acquire Inpixon’s enterprise apps business (including its workplace experience technologies, indoor mapping, events platform, augmented reality and related business solutions) (the “Enterprise Apps Business”) through the merger of KINS Merger Sub with and into CXApp (the “KINS Merger”), with CXApp continuing as the surviving company and as a wholly-owned subsidiary of KINS, in exchange for the issuance of shares of KINS capital stock valued at $69 million (the “KINS Business Combination”). Immediately prior to the KINS Merger and pursuant to a Separation and Distribution Agreement, dated as of September 25, 2022, among KINS, Inpixon, Design Reactor, Inc., a California corporation (“Design Reactor”) and CXApp (the “KINS Separation Agreement”), and other ancillary conveyance documents, Inpixon would, among other things and on the terms and subject to the conditions of the KINS Separation Agreement, transfer the Enterprise Apps Business, including certain related subsidiaries of Inpixon, including Design Reactor, to CXApp (the “KINS Reorganization”). Following the KINS Reorganization, Inpixon would distribute 100% of the common stock of CXApp, par value $0.00001, to certain holders of Inpixon securities as of the record date of March 6, 2023 (the “Enterprise Apps Spin-Off”).

On March 14, 2023, we completed the Enterprise Apps Spin-off and subsequent KINS Business Combination (the “KINS Closing”) In connection with the KINS Closing, KINS was renamed CXApp Inc. (“New CXApp”). Pursuant to the KINS Transaction Agreements, Inpixon contributed to CXApp cash and certain assets and liabilities constituting the Enterprise Apps Business, including certain related subsidiaries of Inpixon, to CXApp (the “CXApp Contribution”). In consideration for the CXApp Contribution, CXApp issued to Inpixon additional shares of CXApp common stock such that the number of shares of CXApp common stock then outstanding equaled the number of shares of CXApp common stock necessary to effect the KINS Distribution. Pursuant to the KINS Distribution, Inpixon shareholders as of the KINS Record Date received one share of CXApp common stock for each share of Inpixon common stock held as of such date. Pursuant to the KINS Merger Agreement, each share of Legacy CXApp common stock was thereafter exchanged for the right to receive 0.09752221612415190 of a share of New CXApp Class A common stock (with fractional shares rounded down to the nearest whole share) and 0.3457605844401750 of a share of New CXApp Class C common stock (with fractional shares rounded down to the nearest whole share). New CXApp Class A common stock and New CXApp Class C common stock are identical in all respects, except that New CXApp Class C common stock is not listed and will automatically convert into New CXApp Class A common stock on the earlier to occur of (i) the 180th day following the closing of the KINS Merger and (ii) the day that the last reported

sale price of New CXApp Class A common stock equals or exceeds $12.00 per share for any 20 trading days within any 30-trading day period following the closing of the Merger. Upon the closing of the KINS Business Combination, Inpixon’s existing securityholders held approximately 50.0% of the shares of New CXApp common stock outstanding. The Enterprise Apps Spin-off was expected to be tax-free to Inpixon and its stockholders for U.S. federal income tax purposes. If the Business Combination with XTI is completed, the Enterprise Apps Spin-off would become taxable to Inpixon. For more details, please see the risk factor entitled “The Business Combination is expected to cause the Enterprise Apps Spin-off to become taxable to Inpixon.”

On March 15, 2023, New CXApp began regular-way trading on NASDAQ under the ticker symbol “CXAI.” Inpixon continues to trade under the ticker symbol “INPX.”

Effective as of October 7, 2022, we effected a reverse stock split of our authorized and issued and outstanding common stock at a ratio of 1-for-75, for the purpose of complying with Nasdaq Listing Rule 5550(a)(2).

Corporate Information

As of June 30, 2023, we had four operating subsidiaries: (i) Inpixon Limited (100% ownership) based in Slough, United Kingdom; (iii) Inpixon GmbH (100% ownership) based in Ratingen, Germany; (iv) Game Your Game, Inc., based in Palo Alto, CA (55.4%); (vi) Inpixon India Limited (82.5% ownership) based in Hyderabad, India;. In addition, Active Mind Technology Ltd. and Active Mind Technology R&D, both based in Galway, Ireland, are indirect subsidiaries of the Company and the wholly-owned subsidiaries of Game Your Game Inc. Nanotron Technologies GmBh (“Nanotron”), based in Berlin, Germany is an indirect subsidiary of the Company and the wholly-owned subsidiary of Inpixon GmbH and IntraNav GmbH, based in Eschborn, Germany (“IntraNav”) is an indirect subsidiary of the Company and the wholly-owned subsidiary of Nanotron.

Our principal executive offices are located at 2479 E. Bayshore Road, Suite 195, Palo Alto, CA 94303, and our telephone number is (408) 702-2167. As of December 31, 2022, our subsidiaries maintained offices in Toronto, Ontario, Hyderabad, India, Berlin Germany, Ratingen, Germany, Eschborn, Germany, Manila, Philippines and Slough, UK. Our Internet website is www.inpixon.com. The information on, or that can be accessed through, our website is not part of this report, and you should not rely on any such information in making any investment decision relating to our common stock.

XTI BUSINESS

In this section, references to “we,” “us,” “XTI”, the “Company” and “our” are intended to refer to XTI Aircraft Company prior to the consummation of the Business Combination and to the combined company after the consummation of the Business Combination, unless the context clearly indicates otherwise.

This section contains forward-looking statements about the business and operations of XTI, and following the Business Combination, the combined company and its subsidiaries. The actual results of XTI and the combined company may differ materially from those currently anticipated as a result of many factors, including those described under “Risk Factors” and elsewhere in this prospectus. See also “Forward Looking Statements.”

Overview

XTI Aircraft Company is an aircraft development and manufacturing company. Headquartered in Englewood, Colorado, the Company is developing a vertical takeoff and landing aircraft that takes off and lands like a helicopter and cruises like a fixed-wing business aircraft. Our initial model, the TriFan 600, is a six-seat aircraft which is intended to provide point-to-point air travel over distances of up to 700 miles, fly at twice the speed of a helicopter and cruise at altitudes up to 25,000 feet.

We believe the TriFan 600 will be one of the first VTOL aircraft that offers the speed and comfort of a business aircraft and the range and versatility of VTOL for a wide range of customer applications, including private aviation for business and high net worth individuals, emergency medical services, and commuter and regional air travel.

The Company was incorporated in October 2009, and began operations in the fourth quarter of 2012. Since then, we have been engaged primarily in developing the design and engineering concepts for the TriFan 600, building and testing a two-thirds scale unmanned version of the TriFan 600, generating pre-orders for the TriFan 600, and seeking funds from investors to enable the Company to build full-scale piloted prototypes of the TriFan 600, and to eventually engage in commercial development of the TriFan 600.

TriFan 600

We believe that the target TriFan 600 design will provide unique advantages over existing helicopters, turboprop and light jet aircraft. Since the aircraft will take off and land vertically, we anticipate that the TriFan 600 will generate significant time savings on a typical 500-mile trip by traveling point-to-point or utilizing more convenient existing ground and airspace infrastructure (such as helipads) to avoid or reduce the time traveling on the ground to and from an airport. The TriFan 600 also is expected to have the capability to take off and land conventionally, if a runway is available. This added capability is expected to increase range and payload and expand utility.

We plan to either assemble the TriFan 600 aircraft in-house with supplier-provided components or engage a third-party manufacturer to assemble the aircraft. By combining existing and future state-of-the-art technologies and components (including turbine engines, composites, software, advanced propulsion and fuel systems) into our patented proprietary design, we believe the TriFan 600 will be a commercially successful aircraft for the business and other aviation markets described below.

Engineering and Development to Date

We plan to seek FAA certification of the TriFan 600 as a fixed-wing, VTOL aircraft. Initial concept and engineering analysis for the TriFan 600 was completed in April 2014. We built a 65% scale prototype and in May 2019 began initial hover tests. The prototype was successfully hover-tested multiple times. Subsequent to raising private funding during 2021, we hired a number of engineers (employees and consultants) to establish our core engineering organization. Additionally, we retained consulting firms to provide specialized engineering technical knowledge to complement our team.

We completed our preliminary design review (“PDR”) in 2022, which set the stage for the next step of design development. We updated the exterior design of the TriFan 600, including the wing fans location and the horizontal tail, all of which had a positive impact on the performance and efficiency of the aircraft. Design and engineering for other systems, including the propulsion system, landing gear, cockpit visibility, cabin sizing and structural integrity were also advanced significantly during 2021 and 2022.

The PDR phase included the identification of the Company’s supply chain. The team, through the design phase, has identified and started negotiating with key suppliers globally to support each of the components or systems of the TriFan 600, requesting proposals from each. As a result of these efforts, we have established a baseline bill-of-materials.

The current development design review phase (“DDR”) of the program includes further interactions with suppliers to develop and mature major structures and systems of the aircraft. With input from industry-respected suppliers, we believe all systems of the TriFan 600 can be incorporated into the airframe to deliver a fully-integrated solution. The fulfillment of this phase is expected to pave the way for approving engineering designs used to build the aircraft. The DDR phase also includes ongoing communication with the FAA to discuss and maintain awareness of the Company’s compliance with federal regulations.

The next target milestones include critical design review (“CDR”) and building and preliminary testing of a full-scale flight test aircraft. Achieving these milestones, along with building additional full-scale flight test aircraft, is fully dependent on XTI raising additional financing subsequent to the date of this filing.

Following the completion of the first full-scale flight test aircraft, certification from the FAA is expected to take an additional eighteen months to achieve. The Company anticipates FAA certification of the TriFan 600 in 2028.

The Market

In today’s regional air travel market, customers have two choices — either a fixed-wing airplane which requires a runway, or a helicopter which is slower, comparatively expensive, and relatively range limited. What we intend to bring to market is a unique “crossover” aircraft combining the best qualities of both. Our target customers for the TriFan 600 include business jet and helicopter operators, major and regional airlines, companies who own and operate their own private jets, air medical operators and individuals. In terms of current market size, the 2022 year-end General Aviation Aircraft Shipment Reports of the General Aviation Aircraft Manufacturers Association reports total turbine business aircraft and turbine helicopter shipments billings at approximately $27.4 billion for 2022.

We believe the anticipated differentiating performance capabilities of the TriFan 600 — the unique versatility delivered by combining the best of a helicopter and a business aircraft in one platform which we expect will result in significant time and cost savings — will be attractive to customers and disruptive in existing markets. As of the date of this filing, we have conditional pre-orders under a combination of aircraft purchase agreements, non-binding reservation deposit agreements, options and letters of intent for the delivery of more than 700 aircraft. One purchaser located in the southwest region of the United States is a party to a non-binding pre-order for 100 aircraft. We have entered into non-binding options to purchase for an aggregate of 412 aircraft with potential purchasers located in the northeast, southwest and west coast regions of the United States. We have entered into non-binding aircraft reservation deposit agreements for an aggregate of 114 aircraft with potential purchasers located in the United Kingdom, Ireland, Australia, Dubai, India, Japan, Brazil, and the United States. Customers making reservation deposits are not obligated to purchase aircraft until they execute a definitive purchase agreement. We have written letters of intent (without deposits) with customers for an additional 105 aircraft. Customers may request a return of their refundable deposits any time up until the execution of a purchase agreement. These conditional orders and reservations represent the potential of more than $7.0 billion in future gross revenue upon delivery of those aircraft, based on our current list price of $10 million per aircraft assuming we are able to execute on the development program for the TriFan 600, secure FAA certification, and deliver these aircraft. For more details regarding the nature of the conditional pre-orders, please see “— Key Agreement.” For the risks involved with the conditional pre-orders, please see “Risk Factors — The pre-orders we have received for our aircraft are non-binding, conditional or written expressions of interest and may be terminated at any time prior to execution of a definitive purchase agreement. If these pre-orders are cancelled, modified, delayed or not placed in accordance with the terms agreed with each party, our business, results of operations, liquidity and cash flow will be materially adversely affected”, “Risk Factors — The remainder of the development period for the TriFan 600 may take longer than anticipated” and “Risk Factors — We have a limited operating history and have not yet manufactured any non-prototype aircraft or delivered any aircraft to customers, and we may never develop or manufacture any VTOL aircraft.”

In contrast to the eVTOL (electric vertical takeoff and landing) aircraft, essentially short-range air taxis for urban transport being developed by other companies, the TriFan 600 is expected to have significantly greater range of 700 miles in addition to the flexibility to take off and land either vertically or conventionally. With our initial configuration of two turboshaft engines, we expect that our customers will be able to use much of the existing infrastructure on the ground, including more than 5,000 existing helipads in the U.S. alone, as well as other landing

areas where it is safe and legal to land and take off, including job sites, grassy areas, driveways, back yards, other paved and improved surfaces, hospital helipads and regional airports, which may not contain the requisite charging infrastructure for eVTOL aircraft. We expect that this flexibility in takeoff and landing sites will offer a significant competitive advantage over eVTOL aircraft because eVTOL aircraft depend on the availability of battery or hydrogen charging infrastructure which is largely undeveloped at this time. We expect that the TriFan 600 will provide increased connectivity between communities as well as generate time savings for travelers. As technology matures, we envision a transition to hybrid-electric propulsion in our pursuit of taking aviation to a greener future. We believe our phased, measured-risk approach is prudent given the lack of technology readiness of battery and hydrogen propulsion, limited and slow progress with respect to regulatory guidance regarding novel propulsion technologies, and expected long timelines to develop a widespread charging network. With time, we also expect to benefit from the expected expansion of the landing pads, vertiports, and other VTOL aircraft infrastructure that will accommodate the eVTOL air taxis. We anticipate owners and users of the TriFan will be able to access many of those facilities, which should allow XTI to participate to some extent in the upcoming and not yet established Advanced Air Mobility (“AAM”) market.

As of the date of this filing, the base price of the TriFan 600 aircraft is approximately $10 million. The announced price for our only known direct competitor for a civilian fixed-wing VTOL aircraft is between $20 million and $30 million.

The TriFan 600’s $10 million base price falls within the price range ($6.5 million – $12 million) for many of the business airplanes with whom we expect the TriFan 600 to compete. Unlike the TriFan 600, these airplanes require runways for takeoff and landing, which adds to total trip times. The $10 million base price is above the initial purchase price range ($5.5 million to $8.2 million) for helicopters with whom the TriFan 600 expects to compete. However, the TriFan 600 can complete missions at approximately twice the speed of competing helicopters. Therefore, the mission time compared to helicopters is expected to be reduced by 40% – 50% and mission costs and emissions will also be reduced. As a result, we expect the TriFan 600’s five-year cost of ownership (initial base purchase price plus annual direct operating costs) to be lower than much of the helicopter competition.

Competition

The private jet aircraft market is highly competitive and we face a significant number of original equipment manufacturer competitors, most of whom are larger, better known and have better financial resources than us. When the TriFan 600 goes into production, we believe it will compete with other aircraft manufacturers by providing our customers with what we believe is a unique “crossover” aircraft with superior performance capabilities at a competitive purchase price. We believe the TriFan 600 will be one of a small number of aircraft that offers the speed, range and comfort of a business aircraft with the versatility of VTOL. As we expect that the TriFan 600 will be capable of flying greater distances and on average at twice the speed of competing helicopters, we expect the TriFan 600 to offer lower direct operating costs (cost per flight hour) and be able to fly almost twice as many missions, thus generating additional cost savings and revenue for airlines and aircraft operators when compared with helicopters.

Aviation Regulations

In the U.S., civil aviation is regulated by the FAA, which controls virtually every aspect of flight from pilot licensing to aircraft design and construction, and use of the public air space within the boundaries and territorial waters of the United States. The FAA requires that every civilian aircraft that flies in the U.S. carry a valid “type certificate” and airworthiness certificate issued by the FAA or a foreign civil aviation authority.

We intend to seek approval for the design of the TriFan 600 by obtaining a standard Type Certificate under Federal Aviation Regulations, in particular the criteria set forth by the FAA (as defined in Part 23 of the Federal Aviation Regulations (14 CFR Part 23)), as a normal category piloted aircraft that can also take off and land vertically. The Company plans to submit its initial certification plan by the fourth quarter of 2023. The FAA will oversee extensive testing and analysis of the TriFan 600 to confirm the aircraft’s safety, stability, reliability, performance, and compliance with the applicable airworthiness standards.

In addition, once the FAA issues a type certificate to the Company, we intend to apply for a production certificate, the FAA’s approval required for the manufacture of an FAA-approved type design, to enable the Company to manufacture the TriFan in commercial quantities. TriFan 600 aircraft that are manufactured by XTI in accordance with the type certificate and the production certificate will be delivered to customers along with a certificate of airworthiness. To obtain a production certificate from the FAA, we must demonstrate that our organization and our personnel, facilities, and quality system can produce the aircraft such that they conform to the approved design.

Since we are not permitted to deliver commercially produced aircraft to customers until any such aircraft has obtained FAA certification, no material aircraft sales revenue will be generated before receipt of FAA certification. The process of obtaining a valid type certificate, production certificate and airworthiness certificate for the TriFan 600 will take several years.

In addition to the FAA, customers’ operation of the TriFan 600 will be regulated by various state, county, and municipal agencies. Specifically, flight of the TriFan 600 will be regulated by the FAA, while the ability to take off and land will be governed by the FAA and various zoning restrictions imposed by non-federal agencies in each location where an owner of the TriFan 600 intends to operate. These restrictions vary by location. Some government and private locations in the U.S. and around the world limit or prohibit the use of aircraft. There are currently over 5,000 helipads in the U.S. where helicopters are allowed to land. Thus, we expect that customers will be able to legally land the TriFan 600 in these locations and at thousands of other paved areas or grassy areas, job sites, residential and commercial locations in the U.S. and around the world where it’s safe and legal to land VTOL aircraft, as well as smaller general aviation airports unavailable to conventional business aircraft and jets.

Intellectual Property

We have received a utility patent (US Patent 9,676,479) and a design patent (US Patent D741247) for a VTOL aircraft that includes a pair of ducted lift/thrust fans that are rotatably moveable between the lift and thrust positions. Based on those U.S. patents, the Company has also applied for and has been issued multiple additional foreign utility patents, including from China, Japan, Europe and Canada. We have sought to protect the intellectual property of the Company through the use of patents and trade secrets. Employee and third-party consultants have signed non-disclosure agreements with the Company which include standard provisions related to assignment of work product and other requirements to further protect its proprietary rights. We are continuing to develop intellectual property and we intend to aggressively protect our position in key technologies. We own several trademarks protecting the Company’s name and logo. Our intellectual property also includes extensive data, engineering analyses and other know-how.

We have obtained broad patent protection in both respects through the above-referenced patents. Under the European patent, we have applied for issuance of patents in the U.K., France, Germany, and Italy, where we expect the aircraft will be sold and used. Patents are also pending in Brazil.

Key Agreement

This section describes an agreement entered into by XTI, but does not purport to describe all of the terms thereof. The full text of the agreement is filed as an exhibit to the registration statement of which this proxy statement/prospectus forms a part, and the following description is qualified in its entirety by the full text of such exhibit.

Aircraft Purchase Agreement

On February 2, 2022, we entered into a conditional aircraft purchase contract (the “Aircraft Purchase Agreement”) with a counterparty located in the southwest region of the United States (“Counterparty A”) relating to the purchase of 100 TriFan 600 aircraft. The parties’ obligations under the Aircraft Purchase Agreement are subject to certain conditions, including certification of our aircraft by the FAA and obligations to amend the Aircraft Purchase Agreement to add certain material terms including, among others, delivery dates, aircraft specifications, warranties, remedies, milestones relating to the development of the TriFan 600, the type and extent of assistance to be provided by Counterparty A in obtaining certification of the TriFan 600, branding and marketing matters, optional equipment and other matters. Counterparty A’s obligations to consummate the Aircraft Purchase Agreement arise only after all material terms are agreed upon, in the discretion of each party. If the parties do not agree on such material terms, either party will have the right to terminate the agreement if such party determines in its discretion that it is not likely that the material terms will be agreed to in a manner consistent with such party’s business and operational interests (as those interests may change from time to time).

INPIXON MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Unless the context otherwise requires, all references in this section to the “Company,” “we,” “us,” or “our” refer to the business of Inpixon prior to the consummation of the merger described in the Overview of Our Business section below.

The following discussion and analysis should be read in conjunction with Inpixon’s financial statements and related notes included elsewhere in this proxy statement/prospectus. This discussion contains forward-looking statements based upon current expectations that involve risks and uncertainties. Inpixon’s actual results and the timing of selected events could differ materially from those anticipated in these forward-looking statements as a result of several factors, including those set out under “Risk Factors” and elsewhere in this proxy statement/prospectus. See “Cautionary Note Concerning Forward-Looking Statements” elsewhere in this proxy statement/prospectus.

Overview of Our Business

Inpixon is the Indoor Intelligence™ company. Our solutions and technologies help organizations create and redefine exceptional experiences that enable smarter, safer and more secure environments. Inpixon customers can leverage our real-time positioning, and analytics technologies to achieve higher levels of productivity and performance, increase safety and security, improve worker and employee satisfaction rates and drive a more connected work environment. We have focused our corporate strategy on being the primary provider of the full range of foundational technologies needed to form a comprehensive suite of solutions that make indoor data available and actionable to organizations and their employees. Together, our technologies allow organizations to create and utilize the digital twin of a physical location and to deliver enhanced experiences in their current environment and in the metaverse.

Inpixon specializes in providing real-time location systems (RTLS) for the industrial sector. As the manufacturing industry has evolved, RTLS technology has become a crucial aspect of Industry 4.0. Our RTLS solution leverages cutting-edge technologies such as IoT, AI, and big data analytics to provide real-time tracking and monitoring of assets, machines, and people within industrial environments. With our RTLS, businesses can achieve improved operational efficiency, enhanced safety and reduced costs. By having real-time visibility into operations, industrial organizations can make informed, data-driven decisions, minimize downtime, and ensure compliance with industry regulations. With our RTLS, industrial businesses can transform their operations and stay ahead of the curve in the digital age.

Inpixon’s full-stack industrial IoT solution provides end-to-end visibility and control over a wide range of assets and devices. It’s designed to help organizations optimize their operations and gain a competitive edge in today’s data-driven world. The turn-key platform integrates a range of technologies, including RTLS, sensor networks, edge computing, and big data analytics, to provide a comprehensive view of an organization’s operations. We help organizations to track the location and status of assets in real-time, identify inefficiencies, and make decisions that drive business growth. Our IoT stack covers all the technology layers, from the edge devices to the cloud. It includes hardware components such as sensors and gateways, a robust software platforms for data management and analysis, and a user-friendly dashboard for real-time monitoring and control. Our solutions also offer robust security features, to help ensure the protection of sensitive data. Additionally, Inpixon’s RTLS provides scalability and flexibility, allowing organizations to easily integrate it with their existing systems and add new capabilities as their needs evolve.

In addition to our Indoor Intelligence technologies and solutions, we also offer:

•        Digital solutions (eTearsheets; eInvoice, adDelivery) or cloudbased applications and analytics for the advertising, media and publishing industries through our advertising management platform referred to as Shoom by Inpixon; and

•        A comprehensive set of data analytics and statistical visualization solutions for engineers and scientists referred to as SAVES by Inpixon.

We report financial results for three segments: Indoor Intelligence, Shoom and SAVES. For Indoor Intelligence, we generate revenue from sales of hardware, software licenses and professional services. For Shoom and SAVES we generate revenue from the sale of software licenses.

We experienced a net loss from continuing operations of approximately $38.2 million and $32.4 million for the years ended December 31, 2022 and 2021, respectively. This increase in loss of approximately $5.8 million was primarily attributable to the higher gross margin of $0.6 million, decrease in operating expenses of $0.4 million, decrease in income tax provision of $4.0 million, offset by an increased other loss of $10.9 million. We experienced a net loss from continuing operations of approximately $19.7 million and approximately $19.7 million for the six months ended June 30, 2023 and 2022, respectively. We cannot assure that we will ever earn revenues sufficient to support our operations, or that we will ever be profitable. In order to continue our operations, we have supplemented the revenues we earned with proceeds from the sale of our equity and debt securities and proceeds from loans and bank credit lines.

Recent Events

Financings

At-The-Market (ATM) Program

On July 22, 2022, Inpixon entered into an Equity Distribution Agreement (the “Sales Agreement”) with Maxim Group LLC (“Maxim”) under which we may offer and sell shares of our common stock having an aggregate offering price of up to $25 million (the “Shares”) from time to time through Maxim, acting exclusively as our sales agent (the “ATM Offering”). Maxim is entitled to compensation at a fixed commission rate of 3.0% of the gross sales price per Share sold excluding Maxim’s costs and out-of-pocket expenses incurred in connection with its services, including the fees and out-of-pocket expenses of its legal counsel. On June 13, 2023, Inpixon entered into an amendment to the Sales Agreement with Maxim, pursuant to which the aggregate offering price of the ATM Offering was increased from $25.0 million to approximately $27.4 million. During the nine months ended September 30, 2023, the Company sold 70,375,554 shares of common stock at share prices between $0.139609 and $1.86 per share under the Sales Agreement for gross proceeds of approximately $27.4 million or net proceeds of $26.5 million after deducting the placement agency fees and other offering expenses.

Inpixon is currently subject to the SEC’s “baby shelf rules,” as of April 17, 2023, which prohibits companies with a public float of less than $75 million from issuing securities under a shelf registration statement in excess of one-third of such Inpixon’s public float in a 12-month period. These rules may limit future issuances of shares by Inpixon or other offerings pursuant to Inpixon’s effective shelf registration statement on Form S-3.

Note Exchanges and Amendments

On May 16, 2023, Inpixon entered into an amendment (the “July 2022 Note Amendment”) to the July 2022 Note pursuant to which the maturity date was extended from July 22, 2023 to May 17, 2024 (the “July 2022 Note Maturity Date Extension”). In exchange for the July 2022 Note Maturity Date Extension, Inpixon agreed to pay Streeterville an extension fee in the amount of $0.1 million, which was added to the outstanding balance of the July 2022 Note.

On May 16, 2023, Inpixon entered into an amendment (the “December 2022 Note Amendment”) to the December 2022 Note pursuant to which the maturity date of the December 2022 Note was extended from December 30, 2023 to May 17, 2024 (the “December 2022 Note Maturity Date Extension”). In exchange for the December 2022 Note Maturity Date Extension, Inpixon agreed to pay the Holder an extension fee in the amount of $0.1 million which was added to the outstanding balance of the December 2022 Note.

From March 31, 2023 through June 30, 2023, Inpixon entered into exchange agreements with Streeterville, pursuant to which Inpixon and Streeterville agreed to: (i) partition new promissory notes in the form of the July 2022 Note equal to approximately $2.0 million and then cause the outstanding balance of the July 2022 Note to be reduced by approximately $2.0 million; and (ii) exchange the partitioned notes for the delivery of 7,349,420 shares of Inpixon’s common stock, at effective prices between $0.1950 and $0.3966 per share.

From July 1, 2023 through September 30, 2023, Inpixon exchanged approximately $3.18 million of the outstanding principal and interest under the July 2022 10% Note Purchase Agreement and Promissory Note for 18,144,158 shares of Inpixon’s common stock at prices from $0.1277 to $0.2272 per share, calculated in accordance with Nasdaq’s “minimum price” as defined by Nasdaq Listing Rule 5635(d).

From October 1, 2023 through October 24, 2023, Inpixon entered into exchange agreements with Streeterville, pursuant to which Inpixon and Streeterville agreed to: (i) partition new promissory notes in the form of the July 2022 Note in the aggregate original principal amount equal to approximately $1.6 million and then cause the outstanding balance of the July 2022 Note to be reduced by an aggregate of approximately $1.6 million; and (ii) exchange the partitioned notes for the delivery of the 15,996,373 shares of Inpixon’s common stock, at effective prices between $0.0984 and $0.1044 per share, calculated in accordance with Nasdaq’s “minimum price” as defined by Nasdaq Listing Rule 5635(d).

Compliance with Nasdaq Continued Listing Requirement

On April 14, 2023, Inpixon received a letter from the Listing Qualifications Staff of The Nasdaq Stock Market LLC (“Nasdaq”) indicating that, based upon the closing bid price of our common stock for the last 30 consecutive business days beginning on March 2, 2023, and ending on April 13, 2023, Inpixon no longer meets the requirement to maintain a minimum bid price of $1 per share, as set forth in Nasdaq Listing Rule 5550(a)(2). In accordance with Nasdaq Listing Rule 5810(c)(3)(A), Inpixon has been provided a period of 180 calendar days, or until October 11, 2023, in which to regain compliance. In order to regain compliance with the minimum bid price requirement, the closing bid price of our common stock must be at least $1 per share for a minimum of ten consecutive business days during this 180-day period. In the event that Inpixon does not regain compliance within this 180-day period, Inpixon may be eligible to seek an additional compliance period of 180 calendar days if it meets the continued listing requirement for market value of publicly held shares and all other initial listing standards for the Nasdaq Capital Market, with the exception of the bid price requirement, and provides written notice to Nasdaq of its intent to cure the deficiency during this second compliance period, by effecting a reverse stock split, if necessary. However, if it appears to the Nasdaq staff that Inpixon will not be able to cure the deficiency, or if Inpixon is otherwise not eligible, Nasdaq will provide notice to Inpixon that our common stock will be subject to delisting. The letter does not result in the immediate delisting of our common stock from the Nasdaq Capital Market. Inpixon intends to monitor the closing bid price of our common stock and consider its available options in the event that the closing bid price of our common stock remains below $1 per share. We plan to request an extension of the initial 180-day period to regain compliance in accordance with Nasdaq Listing Rule 5810(c)(3)(A)(ii).

If during the compliance period the Inpixon’s common stock has a closing bid price of $0.10 or less for ten consecutive trading days, the Nasdaq Listing Qualifications Department may issue a Staff Delisting Determination under Nasdaq Listing Rule 5810. As of November 6th, 2023, our closing bid price has been trading at $0.10 or less for nine consecutive trading days. In the event Inpixon receives such a delisting determination, Nasdaq rules will permit Inpixon to appeal a delisting determination to a Nasdaq Hearings Panel. If such as letter is received, Inpixon intends to appeal such determination. The Inpixon Reverse Stock Split, when implemented, is expected to satisfy Nasdaq’s minimum bid price requirement.

May 2023 Warrant Purchase Agreement

On May 15, 2023, Inpixon entered into a Warrant Purchase Agreement (the “Agreement”) with multiple purchasers for the purchase and sale of up to an aggregate of 150,000,000 of warrants (the “May 2023 Warrants”). The Agreement and the May 2023 Warrants were subsequently amended on June 20, 2023. The purchase price for one (1) May 2023 Warrant is $0.01 (the “Per Warrant Purchase Price”). The May 2023 Warrants have an initial exercise price $0.26, payable in cash or the cancellation of indebtedness ( the “Initial Exercise Price”). The exercise price will equal the lower of (i) the Initial Exercise Price and (ii) 90% of the lowest VWAP (as defined in the Agreement) of the Common Stock for the five Trading Days (as defined in the Agreement) immediately prior to the date on which a Notice of Exercise is submitted to Inpixon (the “Adjusted Exercise Price” and together with the Initial Price, as applicable, the “Exercise Price”); provided, however, that the Adjusted Exercise Price shall not be less than $0.10; and provided further that any exercise of the May 2023 Warrants with an Adjusted Exercise Price will be subject to Inpixon’s consent unless the trading price of the Common Stock as of the time the Notice of Exercise is delivered to Inpixon is at least 10% or more above the prior Trading Day’s Nasdaq Official Closing Price. No warrant holder may exercise the May 2023 Warrants to the extent such exercise would cause such warrant holder, together with its affiliates and attribution parties, to beneficially own a number of shares of Common Stock which would exceed 9.99% of Inpixon’s then outstanding Common Stock following such exercise.

Each May 2023 Warrant is immediately exercisable for one share of Common Stock and will expire one year from the issuance date (the “Termination Date”) unless extended by Inpixon with the consent of the warrant holder.

Pursuant to the terms of the May 2023 Warrants, at any time prior to the Termination Date, Inpixon may, in its sole discretion, redeem any portion of a May 2023 Warrants that have not been exercised, in cash, at the Per Warrant Purchase Price, plus all liquidated damages and other costs, expenses or amounts due in respect of the Warrants (the “Redemption Amount”) upon five Trading Days’ written notice to the warrant holder (the “Redemption Date”). On the Termination Date, Inpixon will be required to redeem any portion of the May 2023 Warrants that have not been exercised or redeemed prior to such date through payment of the Redemption Amount in cash. Inpixon will be required to pay any Redemption Amount within five Trading Days after the Redemption Date or the Termination Date, as applicable.

The May 2023 Warrants were issued on May 17, 2023 for aggregate gross proceeds of approximately $1.5 million. The aggregate net proceeds from the offerings, after deducting the placement agent fees and other estimated offering expenses, were approximately $1.4 million.

During July 2023, Inpixon issued 9,000,000 shares of common stock in connection with the exercise of 9,000,000 warrants with an exercise price of $0.26 per share in connection with the May 2023 warrant offering for which Inpixon received gross proceeds of approximately $2.3 million.

Maxim Agreement

Pursuant to a Financial Advisory and Investment Banking Services Agreement dated May 16, 2023, between Inpixon and Maxim Group LLC (“Maxim”) (the “Maxim Agreement”), as part of compensation for Maxim’s services in connection with the transaction, Inpixon has agreed to pay to Maxim, upon Closing, a cash fee equal to $800,000 (the “Cash Fee”), and to issue to Maxim (or its designees) registered common stock of Inpixon pursuant to the applicable registration statement on Form S-4 for the transaction, if permitted under SEC rules, or unregistered stock if not permitted, equal to the quotient obtained by dividing $1,000,000 by the closing price of Inpixon common stock as reported by Nasdaq on the date immediately preceding the announcement of the transaction, at the closing of the transaction. However, to the extent that Maxim would beneficially own more than 4.99% of the number of shares of Inpixon common stock outstanding immediately after giving effect to such issuance, then Maxim will receive rights to such remaining amount of shares in accordance with a rights to shares agreement, in such form reasonably acceptable to the parties. Based on the closing price of Inpixon common stock as of July 24, 2023, which equals $0.1523 per share, Maxim will be entitled to approximately 6,565,988 shares of Inpixon common stock in connection with the Closing of the Proposed Transaction. These shares will be issued in reliance on an exemption from registration under Section 4(a)(2) of the Securities Act, if they are not registered.

XTI Promissory Note & Security Agreement

Pursuant to the Merger Agreement, on the first calendar day of the month following the date of the Merger Agreement and on the first calendar day of each month thereafter until the earlier of (i) four months following the date of the Merger Agreement and (ii) the Closing Date, Inpixon shall provide loans to XTI on a senior secured basis (each, a “Future Loan”), in such amounts requested by XTI in writing prior to the first calendar day of each such month. Each Future Loan will be in the principal amount of up to $500,000, and the aggregate amount of the Future Loans will be up to $1,775,000 (or such greater amount as Inpixon shall otherwise agree in its sole and absolute discretion). These Future Loans and security will be evidenced by a Senior Secured Promissory Note (the “Promissory Note”) and a Security and Pledge Agreement (the “Security Agreement”).

The Promissory Note provides an aggregate principal amount up to $2,313,407, which amount includes the principal sum of $525,000 which Inpixon previously advanced to XTI (the “Existing Loans”, collectively with the Future Loans, the “Inpixon Loans to XTI”) plus accrued interest on such amount, and the aggregate principal amount of the Future Loans. The Promissory Note will bear interest at 10% per annum, compounded annually, and for each Future Loan, beginning on the date the Future Loan is advanced to XTI.

The outstanding principal amount under the Promissory Note, together with all accrued and unpaid interest, shall be due and payable upon the earlier of (a) December 31, 2023, (b) when declared due and payable by Inpixon upon the occurrence of an event of default, or (c) within three business days following termination of the Merger Agreement (i) by XTI because the XTI Board adopts a superior proposal prior to delivering the XTI Stockholder Consent, or (ii) by Inpixon because the XTI Board has made a change in recommendation, or XTI has breached or failed to perform in any material respect any of its covenants and agreements regarding obtaining its required stockholder approval or non-solicitation. The Promissory Note will be forgiven and of no further force if the Merger Agreement is

terminated by Inpixon Board because it adopts a superior proposal prior to obtaining the required Inpixon stockholder approval, subject to Inpixon’s rights and remedies under the Promissory Note, the Security Agreement, and the Merger Agreement. If the Merger Agreement is terminated by XTI because Inpixon Board makes a change in recommendation or Inpixon is in material breach of its covenants and agreements regarding obtaining its required stockholder approval or non-solicitation, the maturity date of the Promissory Note will be extended to December 31, 2024.

The Security Agreement grants Inpixon a first priority security interest in and lien upon all of XTI’s property to secure the repayment of the Promissory Note.

Grafiti Holding Spin-off and Proposed Business Combination between Grafiti Holding and Damon Motors

The following information was previously reported in Inpixon’s Current Report on Form 8-K filed with the SEC on October 23, 2023.

As a condition to closing the transactions contemplated by the Merger Agreement, Inpixon is required to complete the divestiture of its Shoom, SAVES and Game Your Game lines of business and investment securities, as applicable, by any lawful means, including a sale to one or more third parties, spin off, plan of arrangement, merger, reorganization, or any combination of the foregoing. The Distribution (as described below), if completed, would constitute part of the Solutions Divestiture.

On October 23, 2023, as part of the Solutions Divestiture, Inpixon entered into a Separation and Distribution Agreement with Grafiti Holding Inc., a British Columbia corporation and newly formed wholly-owned subsidiary of Inpixon, pursuant to which Inpixon plans to transfer to Grafiti all of the outstanding shares of Inpixon Limited, a UK limited company that operates Inpixon’s SAVES line of business in the UK, such that Inpixon UK will become a wholly-owned subsidiary of Grafiti. Following the Reorganization and subject to conditions in the Separation Agreement, Inpixon will spin off Grafiti by distributing to Inpixon stockholders and certain securities holders as of a record date to be determined on a pro rata basis all of the outstanding common shares of Grafiti owned by Inpixon, subject to certain lock-up restrictions and subject to registration of the Grafiti Common Shares pursuant to the Securities Exchange Act, or the Securities Act.

On October 23, 2023, Inpixon entered into a Business Combination Agreement, by and among Inpixon, Damon Motors Inc., a British Columbia corporation, Grafiti, and 1444842 B.C. Ltd., a British Columbia corporation and a newly formed wholly-owned subsidiary of Grafiti, pursuant to which it is proposed that Amalco Sub and Damon amalgamate under the laws of British Columbia, Canada with the amalgamated company continuing as a wholly-owned subsidiary of Grafiti. The Damon Business Combination is subject to material conditions, including approval of the Damon Business Combination by securities holders of Damon, approval of the issuance of Grafiti Common Shares to Damon securities holders pursuant to the Damon Business Combination Agreement by a British Columbia court after a hearing upon the fairness of the terms and conditions of the Damon Business Combination Agreement as required by the exemption from registration provided by Section 3(a)(10) under the Securities Act, and approval of the listing of the Grafiti Common Shares on the Nasdaq Stock Market after giving effect to the Damon Business Combination. Upon the consummation of the Damon Business Combination, both Inpixon UK and the Damon Surviving Corporation will be wholly-owned subsidiaries of Grafiti, which will adopt a new name as determined by Damon. Grafiti, after the Damon Closing, is referred to herein as the “Grafiti combined company.” Pursuant to the Damon Business Combination Agreement, the parties will take all necessary action so that at the Damon Closing, the board of directors of the Grafiti combined company will consist of such directors as Damon may determine, subject to the independent requirements under the Nasdaq rules, and provided that at least one director will be nominated by Grafiti.

Holders of Grafiti Common Shares, including Participating Securityholders and management that hold Grafiti Common Shares immediately prior to the Damon Closing, are anticipated to retain approximately 18.75% of the outstanding capital stock of the Grafiti combined company determined on a fully diluted basis, which includes up to 5% in equity incentives which may be issued to Inpixon management.

Inpixon expects that there will be no public trading market for the Grafiti Common Shares unless the Damon Business Combination is consummated.

No securities of Inpixon will be issued in connection with the Damon Business Combination.

Critical Accounting Policies and Estimates

Our consolidated financial statements are prepared in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”). In connection with the preparation of our consolidated financial statements, we are required to make assumptions and estimates about future events, and apply judgments that affect the reported amounts of assets, liabilities, revenue, expenses and the related disclosures. We base our assumptions, estimates and judgments on historical experience, current trends and other factors that management believes to be relevant at the time our consolidated financial statements are prepared. On a regular basis, we review the accounting policies, assumptions, estimates and judgments to ensure that our consolidated financial statements are presented fairly and in accordance with GAAP. However, because future events and their effects cannot be determined with certainty, actual results could differ from our assumptions and estimates, and such differences could be material.

Our significant accounting policies are discussed in Note 2 of the audited consolidated financial statements for the years ended December 31, 2022 and 2021 and discussed in Note 3 of the unaudited condensed consolidated financial statements for the six months ended June 30, 2023 and 2022. We believe that the following accounting estimates are the most critical to aid in fully understanding and evaluating our reported financial results, and they require our most difficult, subjective or complex judgments, resulting from the need to make estimates about the effect of matters that are inherently uncertain. There have been no changes to estimates during the periods presented in the filing. Historically changes in management estimates have not been material.

Revenue Recognition

The Company recognizes revenue when control is transferred of the promised products or services to its customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those products or services. The Company derives revenue from software as a service, design and implementation services for its Indoor Intelligence systems, and professional services for work performed in conjunction with its systems.

Our contracts with customers often include promises to transfer multiple distinct products and services. Our licenses are sold as perpetual or term licenses and the arrangements typically contain various combinations of maintenance and professional services, which are accounted for as separate performance obligations. In determining how revenue should be recognized, a five-step process is used, which requires judgment and estimates within the revenue recognition process. The most critical judgements required in applying ASC 606 Revenue Recognition from Customers, and our revenue recognition policy relate to the determination of distinct performance obligations.

•        We receive fixed consideration for sales of hardware and software products. Revenue is recognized at point in time when the customer has title to the product and risks and rewards of ownership have transferred.

•        Revenue related to software as a service contract is recognized over time using the output method (days of software provided) because we are providing continuous access to its service.

•        Design and implementation revenue is accounted for using the percentage of completion method. As soon as the outcome of a contract can be estimated reliably, contract revenue is recognized in the consolidated statement of operations in proportion to the stage of completion of the contract. Accounting for these contracts involves the use of estimates to determine total contract costs to be incurred.

•        Professional services revenue under fixed fee contracts is recognized over time using the input method (direct labor hours) to recognize revenue over the term of the contract. We have elected the practical expedient to recognize revenue for the right to invoice because our right to consideration corresponds directly with the value to the customer of the performance completed to date.

•        We recognize revenue related to Maintenance Services evenly over time using the output method (days of software provided) because we provide continuous service, and the customer simultaneously receives and consumes the benefits provided by our performance as the services are performed.

We also consider whether an arrangement has any discounts, material rights, or specified future upgrades that may represent additional performance obligations. We offer discounts in the form of prompt payment discounts and rebates for a decrease in service level percentages. We have determined that the most likely amount method is most useful for contracts that provides these discounts and rebates as the contracts have two potential outcomes and a significant reversal in the amount of cumulative revenue recognized is not expected to occur. Discounts have not historically been significant, but we continue to monitor and evaluate these estimates based on historical experience,

anticipated performance, and our best judgment. Renewals or extensions of licenses are evaluated as distinct licenses (i.e., a distinct good or service), and revenue attributed to the distinct good or service cannot be recognized until (1) the entity provides the distinct license (or makes the license available) to the customer and (2) the customer is able to use and benefit from the distinct license. If any of these judgments were to change it could cause a material increase or decrease in the amount of revenue we report in a particular period.

Goodwill, Acquired Intangible Assets and Other Long-Lived Assets — Impairment Assessments

Long-lived assets are grouped for recognition and measurement of impairment at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets. The impairment test for long-lived assets requires us to assess the recoverability of our long-lived assets by comparing their net carrying value to the sum of undiscounted estimated future cash flows directly associated with and arising from our use and eventual disposition of the assets. If the net carrying value of a group of long-lived assets exceeds the sum of related undiscounted estimated future cash flows, we would be required to record an impairment charge equal to the excess, if any, of net carrying value over fair value.

When assessing the recoverability of our long-lived assets, which include property and equipment and finite-lived intangible assets, we make assumptions regarding estimated future cash flows and other factors. Some of these assumptions involve a high degree of judgment and bear a significant impact on the assessment conclusions. Included among these assumptions are estimating undiscounted future cash flows, including the projection of comparable sales, operating expenses, capital requirements for maintaining property and equipment and residual value of asset groups. We formulate estimates from historical experience and assumptions of future performance, based on business plans and forecasts, recent economic and business trends, and competitive conditions. In the event that our estimates or related assumptions change in the future, we may be required to record an impairment charge.

We evaluate the remaining useful lives of long-lived assets and identifiable intangible assets whenever events or circumstances indicate that a revision to the remaining period of amortization is warranted. Such events or circumstances may include (but are not limited to): the effects of obsolescence, demand, competition, and/or other economic factors including the stability of the industry in which we operate, known technological advances, legislative actions, or changes in the regulatory environment. If the estimated remaining useful lives change, the remaining carrying amount of the long-lived assets and identifiable intangible assets would be amortized prospectively over that revised remaining useful life. We have determined that there were no events or circumstances during the years ended December 31, 2022 and 2021, and the six months ended June 30, 2023 and 2022, which would indicate a revision to the remaining amortization period related to any of our long-lived assets. Accordingly, we believe that the current estimated useful lives of long-lived assets reflect the period over which they are expected to contribute to future cash flows and are therefore deemed appropriate.

We have recorded goodwill and other indefinite-lived assets in connection with our acquisitions of Shoom, Locality, Jibestream, GTX, the Systat Parties, Nanotron, CXApp, Game Your Game and IntraNav. Goodwill, which represents the excess of acquisition cost over the fair value of the net tangible and intangible assets of the acquired company, is not amortized. Indefinite-lived intangible assets are stated at fair value as of the date acquired in a business combination. The recoverability of goodwill is evaluated at least annually and when events or changes in circumstances indicate that the carrying amount may not be recoverable. We have determined that it operates and reports in three reporting units: Indoor Intelligence, Saves, and Shoom.

We analyzed goodwill first to assess qualitative factors, such as macroeconomic conditions, changes in the business environment and reporting unit specific events, to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform a detailed goodwill impairment test as required. The more-likely-than-not threshold is defined as having a likelihood of more than 50%.

If we bypass the qualitative assessment or conclude that it is more likely than not that the fair value of a reporting unit is less than its carrying value, then we perform a quantitative impairment test by comparing the fair value of a reporting unit with its carrying amount. We calculate the estimated fair value of a reporting unit using a weighting of the income and market approaches. For the income approach, we use internally developed discounted cash flow models that include the following assumptions, among others made by management: projections of revenues, expenses, and related cash flows based on assumed long-term growth rates and demand trends; expected future investments to grow new units; and estimated discount rates. For the market approach, we use internal analyses based primarily on market comparables.

We base these assumptions on its historical data and experience, third party appraisals, industry projections, micro and macro general economic condition projections, and its expectations. Due to the variables inherent in our estimates of fair value, differences in assumptions may have a material effect on the result of our impairment analysis. For example, a 100 basis points increase or decrease in only the discount rate utilized as part of the discounted cash flow method (income approach) related to the Indoor Intelligence reporting unit could impact the overall fair value of the reporting unit, on a weighted average, by approximately $2.0 million (decrease) and $2.5 million (increase), respectively.

Based on its assessments, the Company has recorded impairment of goodwill and intangibles from continuing operations of $6.7 million and $2.9 million during the years ended December 31, 2022 and 2021, respectively. The Company recorded impairment of goodwill and intangibles from continuing operations during the six months ended June 30, 2023 and 2022 of $0 and $2.0 million, respectively. As of June 30, 2023, the Company’s previously recorded goodwill has been fully impaired.

Deferred Income Taxes

In accordance with ASC 740 “Income Taxes” (“ASC 740”), management routinely evaluates the likelihood of the realization of its income tax benefits and the recognition of its deferred tax assets. In evaluating the need for any valuation allowance, management will assess whether it is more likely than not that some portion, or all, of the deferred tax asset may not be realized on a jurisdictional basis. Ultimately, the realization of deferred tax assets is dependent upon the generation of future taxable income during those periods in which temporary differences become deductible and/or tax credits and tax loss carry-forwards can be utilized. In performing its analyses, management considers both positive and negative evidence including historical financial performance, previous earnings patterns, future earnings forecasts, tax planning strategies, economic and business trends and the potential realization of net operating loss carry-forwards within a reasonable timeframe. To this end, management considered (i) that we have had historical losses in the prior years and cannot anticipate generating a sufficient level of future profits in order to realize the benefits of our deferred tax asset; (ii) tax planning strategies; and (iii) the adequacy of future income as of and for the year ended December 31, 2022, based upon certain economic conditions and historical losses through December 31, 2022. After consideration of these factors, management deemed it appropriate to establish a full valuation allowance with respect to the deferred tax assets for Inpixon, Inpixon Canada, Nanotron GmbH, Intranav GmbH, Inpixon Limited, Inpixon Philippines and Active Mind Technology LTD.

A liability for “unrecognized tax benefits” is recorded for any tax benefits claimed in the Company’s tax filings that do not meet these recognition and measurement standards. As of December 31, 2022 and 2021 and as of June 30, 2023 and 2022, no liability for unrecognized tax benefits was required to be reported. The guidance also discusses the classification of related interest and penalties on income taxes. The Company’s policy is to record interest and penalties on uncertain tax positions as a component of income tax expense. No interest or penalties were recorded during the years ended December 31, 2022 and 2021 or for the six months ended June 30, 2023 and 2022.

Business Combinations

We account for business combinations using the acquisition method of accounting, and accordingly, the assets and liabilities of the acquired business are recorded at their fair values at the date of acquisition. The excess of the purchase price over the estimated fair value is recorded as goodwill. Any changes in the estimated fair values of the net assets recorded for acquisitions prior to the finalization of more detailed analysis, but not to exceed one year from the date of acquisition, will change the amount of the purchase price allocable to goodwill. Any subsequent changes to any purchase price allocations that are material to our consolidated financial results will be adjusted. All acquisition costs are expensed as incurred and in-process research and development costs are recorded at fair value as an indefinite-lived intangible asset and assessed for impairment thereafter until completion, at which point the asset is amortized over its expected useful life. Separately recognized transactions associated with business combinations are generally expensed subsequent to the acquisition date. The application of business combination and impairment accounting requires the use of significant estimates and assumptions.

Upon acquisition, the accounts and results of operations are consolidated as of and subsequent to the acquisition date and are included in our Consolidated Financial Statements from the acquisition date.

Results of Operations — continuing operations

Three Months Ended June 30, 2023 compared to the Three Months Ended June 30, 2022

The following table sets forth selected condensed consolidated financial data as a percentage of our revenue and the percentage of period-over-period change:

____________

*        Amounts used to calculate dollar and percentage changes are based on numbers in the thousands. Accordingly, calculations in this item, which may be rounded to the nearest hundred thousand, may not produce the same results.

Revenues

Revenues for the three months ended June 30, 2023 were $2.1 million compared to $2.6 million for the comparable period in the prior year for a decrease of approximately $0.5 million, or approximately 20%. This decrease is primarily attributable to the decrease in Indoor Intelligence sales due to delayed shipments and lower sales for the SAVES product line.

Cost of Revenues and Gross Profit

Cost of revenues for the three months ended June 30, 2023 were $0.4 million compared to $0.9 million for the comparable period in the prior year. This decrease in cost of revenues of approximately $0.5 million, or approximately 54%, was primarily attributable to lower revenues during the quarter.

Operating Expenses

Operating expenses for the three months ended June 30, 2023 were $8.3 million and $11.1 million for the comparable period ended June 30, 2022. This decrease of approximately $2.8 million is primarily attributable to the $2.0 million of goodwill impairment in the three month ended June 30,2022 and lower compensation, professional fees and legal expenses in the three months ended June 30, 2023.

Other Income (Expense)