Xeriant Inc (XERI)

[quester614]

You may have said that often but it's NOT what you claimed originally. I have said from the start XERI would not get any XTI STOCK (equity). We have been over cash is NOT equity in a company. So like I've said I'm not a lawyer. I'll add an accountant but XERI might get a small cash award. Didn't Killa say way back XERI might be around $300,000


5.2.???????????Further Contributions, Interest on Capital, JV Percentages and Withdrawal of Capital Contributions. There shall be no required capital contributions other than as expressly set forth in this Agreement. No Party shall have the right to make voluntary capital contributions to the JV, other than as expressly set forth in this Agreement, without the prior written consent of the other Party. There shall be no interest payable on any capital contributions made to the JV. No Party shall have the right or power to (a) withdraw or reduce such capital contribution except as a result of the dissolution of the JV or as otherwise provided by law, or (b) demand or receive property other than CASH in return for its contribution.
https://www.sec.gov/Archives/edgar/data/1638850/000110465922078856/tm2219481d1_ex6-20.htm

Note 3 – Joint Venture

Effective May 31, 2021, the Company and Xeriant Inc. entered into a Joint Venture Agreement (“Agreement”) and other ancillary agreements under which Xeriant agreed to provide $10 million of funding to the Joint Venture (the “Intended Contribution”) to enable XTI to complete the preliminary design review of XTI’s TriFan 600 aircraft. Xeriant provided a total of $5,407,580 of funding under the Agreement and ceased providing funding in December 2021. The Agreement and the ancillary agreements expired by their terms on May 31, 2023. Although Xeriant did not make the full Intended Contribution, it is entitled to receive a pro rata portion of the agreed 10% of XTI common stock it would have received in exchange for its joint venture interest had it made the full Intended Contribution.

In satisfaction of its obligations the Company will issue 5.4% of its fully-diluted shares to Xeriant in exchange for Xeriant’s interest in the joint venture.
The Company considered ASC 480-10, Distinguishing Liabilities from Equity, and determined the financing arrangement with Xeriant through the Joint Venture is liability classified since the obligation must be settle by issuing a variable number of the Company’s equity shares. Furthermore, the Company considered ASC 815, Derivatives and Hedging, and determined the obligation should be recorded at fair value and marked to market periodically. Accordingly, the Company recorded a $330,501 fair value adjustment (resulting in an income gain) to the obligation for the year ended December 31, 2022. The Company also recorded a fair value adjustment (resulting in an income loss) to the obligation of $309,672 for the year ended December 31, 2021. https://www.sec.gov/Archives/edgar/data/1638850/000110465923080673/tm2317519d2_partii.htm