Company: AEMD
Filing Date: 2025-06-26
Form Type: 10-K
Source: 0001683168-25-004780
Chunk: 830

Company: AETHLON MEDICAL INC
Filing Date: 2025-06-26
Form: 10-K
Item: Item 4
Chunk 830
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9,995, resulting in a total repayment obligation of approximately $230,979.30. The annual
percentage rate is 9.75%, and the loan is payable in 10 monthly installments of approximately $23,097.93 beginning February 28, 2025.

As collateral for the financing, the Company granted the lender a first
priority security interest in the financed insurance policies, including all unearned premiums, dividends, credits, and certain loss payments.
In the event of default, cancellation, or early termination of the policies, the lender has the right to collect any unearned premiums
and apply them against the remaining loan balance.

This arrangement is classified as a short-term liability within other
liabilities on the balance sheet (See Note 6) and is recorded net of any prepaid portions of the insurance policies.

LEGAL MATTERS

From time to time, claims are made against us
in the ordinary course of business, which could result in litigation. Claims and associated litigation are subject to inherent uncertainties
and unfavorable outcomes could occur, such as monetary damages, fines, penalties or injunctions prohibiting us from selling one or more
products or engaging in other activities.

The occurrence of an unfavorable outcome in any
specific period could have a material adverse effect on our results of operations for that period or future periods. We are not presently
a party to any pending or threatened legal proceedings.

9. SEGMENT REPORTING

The Company operates as a single operating and reportable segment,
which reflects the manner in which the Chief Operating Decision Maker (CODM), the Company’s Chief Executive Officer, manages the
business and allocates resources. The Company is a development-stage medical technology company focused on advancing a clinical-stage
therapeutic device, with key operational decisions based on cash availability, development milestones, and return on investment associated
with future manufacturing and commercialization opportunities.

Although the Company has no commercial revenue, the CODM regularly
reviews certain expense categories and cash flow metrics to assess progress and allocate resources. The primary internal measure of performance
used by the CODM is cash used in operating activities, rather than traditional profit or loss measures.

In accordance with ASU 2023-07, which the Company adopted for the
year ended March 31, 2025, the following significant expense categories and internal performance measures were reviewed by the CODM during
the fiscal year ended March 31, 2025 and March 31, 2024:

    Schedule of significant expense categories 

    Category 
    Year