Company: XAIR
Filing Date: 2025-06-20
Form Type: 10-K
Source: 0001641172-25-015750
Chunk: 2594

Company: Beyond Air, Inc.
Filing Date: 2025-06-20
Form: 10-K
Item: Item 9C
Chunk 2594
---
 -  
     (4,541)
  
    Amortization of debt discount 
     -  
     1,149 
  
    Final payment liability 
     -  
     613 
  
    Total 
    $-  
    $14,721 

    F-28

BEYOND
AIR, INC. AND SUBSIDIARIES

NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE
10 LOANS (continued)

On November 1, 2024, the
Company entered into a Loan and Security Agreement (the “Loan Agreement”) for a secured loan with certain lenders, including
its Chief Executive Officer Steven Lisi and director Robert Carey, for an aggregate principal balance of $11.5 million. The Loan Agreement
was approved by each of the Company’s independent and disinterested directors, following the receipt of a recommendation from an
independent investment bank. The Loan Agreement provides for the following terms: (i) principal amount of $11,500,000;
(ii) ten-year term; (iii) interest of 15%
per annum of which 3% shall be payable in cash and 12% payable in kind through June 30, 2026 and thereafter all in cash; (iv) a royalty interest of 8%
of the Company’s net sales on a quarterly basis from July 2026 until the facility is repaid in full; (v) the Company’s obligations
will be secured by substantially all of the Company’s assets and (vi) the Company shall issue the lenders warrants to purchase
shares of the Company’s common stock at an exercise price of $0.3793
per share.

As
the repayments under the Loan Agreement are based on a fixed percentage of future net sales, the timing and amounts of future principal
payments may vary with the Company’s performance. The outstanding debt balance has been classified in the consolidated balance sheets
based on the Company’s current estimate of the repayment timing.

As part of the Loan
Agreement, the Company issued 15,159,504 warrants to the lenders. The fair value of the warrants was determined using a
Black-Scholes model, resulting in a fair value of $4.2 million. The warrants are classified as an equity instrument and therefore,
the allocation of the loan proceeds to the instrument was based on the relative fair value of the loan and warrants. The fair value
of the Loan was determined to equal the Loan’s