Company: XERI
Filing Date: 2025-10-02
Form Type: 10-K
Source: 0001477932-25-007303
Chunk: 131

Company: XERIANT, INC.
Filing Date: 2025-10-02
Form: 10-K
Item: Item 1A
Chunk 131
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 offerings and marketing activities. Our business or operations may change in a manner that would consume available funds more rapidly than anticipated, and substantial additional funding may be required to maintain operations, fund expansion, develop new or enhanced products or services, acquire complementary products, businesses or technologies or otherwise respond to competitive pressures and opportunities. Furthermore, any equity or debt financings, if available at all, may be on terms which are not favorable to the Company (and therefore its shareholders) and, in the case of a new equity offering by the Company, existing shareholders will be diluted unless they purchase their proportionate share of the equity offering. If adequate capital is not available on economically viable terms and conditions, the Company’s business, operating results and financial condition may be materially adversely affected.

We will need to meet or otherwise resolve the obligations required by the Auctus Fund LLC Senior Secured Note and the Amendment to the Note.

The Company has Senior Secured Promissory Note with Auctus Fund LLC (“Auctus”), which became due and payable on March 15, 2023. At this time, there is no assurance that the Company will work out a favorable resolution of its obligations related to this note. If Auctus elects to enforce the Note, we may lose all or substantially all of our assets.  If Auctus elects to convert the note into shares of our Common Stock, our shareholders could experience substantial dilution.

On October 19, 2023, the Company filed a complaint in the United States Southern District of New York (Case no.1:23-cv-09200) against Auctus Fund LLC, to invalidate allegedly illegally designed contractual agreements, including contesting the enforceability of the related note and amendments, and to set aside improper and unlawful securities transactions effectuated in violation of Section 15(a)(1) of the Exchange Act (15 U.S.C. § 78o(a)(1)) by the Defendant, alleging breaches of fiduciary duty and related claims. On February 9, 2024, the case was dismissed. The Company filed a Notice of Civil Appeal on March 13, 2024, primarily based on public welfare because of the pending litigation between the SEC and Auctus Fund Management, LLC, which complaint was filed on June 1, 2023. On June 19, 2024, the Company filed an appeal in the United States Court of Appeals for the Second Circuit (Case no. 24-682-cv).