UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

☒	Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

x ~~Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934~~

For the quarterly period ended ~~December 31, 2016~~September 30, 2022

☐	¨ Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from __________ to __________.

Commission File Number: 000-54277

~~BANJO & MATILDA, INC~~.XERIANT, INC.
(Exact name of registrant as specified in its charter).

Nevada
27-1519178
(State or other jurisdiction of
of incorporation or organization)
(I.R.S. ~~employer~~Employer
~~identification number)~~Identification No.)
Innovation Centre #1
3998 FAU Boulevard, Suite 309
Boca Raton, Florida
33431
(Address of principal executive offices)
(Zip code)

~~1221 2~~^nd ~~Street #300~~

~~Santa Monica CA 90401~~

~~(Address of principal executive offices and zip code)~~

~~(855) 245-1613~~

(Registrant’s telephone number, including area ~~code)~~code: (561) 491-9595

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading symbol

Name of exchange

on which registered

N/A

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes o ☒ No x☐

Indicate by check mark whether the registrant has submitted electronically ~~and posted on its corporate Web site, if any,~~ every Interactive Data File required to be submitted ~~and posted~~ pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit ~~and post~~ such files). Yes x ☒ No o☐

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

Large accelerated filer
o☐
Accelerated filer
o☐
Non-accelerated filer
o☒
Smaller reporting company
x☒
~~(Do not check if a smaller reporting company)~~Emerging growth company
☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition 13(a) of the Securities Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o ☐ No x☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date. As of ~~February 15, 2017,~~November 18, 2022, the Registrant had outstanding ~~58,823,116~~376,933,144 shares of common stock.

~~BANJO & MATILDA, INC.~~

~~FORM 10-Q~~

~~TABLE OF CONTENTS~~

~~Page~~

XERIANT, INC.

FORM 10-Q

TABLE OF CONTENTS

		~~SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS~~Page			3

Special Note regarding Forward-looking Statements		3

PART I – ~~FINANCIAL INFORMATION~~Financial Information

Item 1.	Condensed Consolidated Financial ~~statements~~Statements (Unaudited)			4
	~~CONDENSED CONSOLIDATED BALANCE SHEETS~~		~~F-1~~
	~~CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS~~		~~F-2~~
	~~CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS~~		~~F-3~~
	~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~		~~F-4~~

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations			5
Item 3.	Quantitative and Qualitative Disclosures about Market Risk		9	6
Item 4.	Controls and Procedures		9
			6

PART II – ~~OTHER INFORMATION~~Other Information

Item 1.	Legal Proceedings		10	7
Item 1A.	Risk Factors		10	7
Item 2.	Unregistered Sales of Equity Securities		10	7
Item 3.	Defaults Upon Senior Securities		10	7
Item 4.	Mine Safety Disclosures		10	7
Item 5.	Other Information		10	7
Item 6.	Exhibits		11	8

~~SIGNATURES~~Signatures			9	12

2
Table of Contents

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This document contains certain statements of a forward-looking nature. Such forward-looking statements, including but not limited to statements regarding projected growth, trends and strategies, future operating and financial results, financial expectations and current business indicators are based upon current information and expectations and are subject to change based on factors beyond the control of the Company. Forward-looking statements typically are identified by the use of terms such as “look,” “may,” “should,” “might,” “believe,” “plan,” “expect,” “anticipate,” “estimate” and similar words, although some forward-looking statements are expressed differently. The accuracy of such statements may be impacted by a number of risks and uncertainties that could cause actual results to differ materially from those projected or anticipated, including but not limited to those set forth herein and in our Annual Report on Form 10-K.

Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. Except as required by the federal securities laws, we undertake no obligation to update forward-looking information. Nonetheless, the Company reserves the right to make such updates from time to time by press release, periodic report or other method of public disclosure without the need for specific reference to this Report. No such update shall be deemed to indicate that other statements not addressed by such update remain correct or create an obligation to provide any other updates.

3
Table of Contents

PART I – FINANCIAL INFORMATION

Item 1. Financial statements

~~BANJO & MATILDA,~~XERIANT, INC. ~~AND SUBSIDIARIES~~

CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

~~DECEMBER 31, 2016~~SEPTEMBER 30, 2022

(UNAUDITED)

INDEX TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Condensed Consolidated Balance Sheets as of September 30, 2022 (Unaudited) and June 30, 2022
F-1
Condensed Consolidated Statements of Operations for the three months ended September 30, 2022 and ~~Comprehensive Loss~~2021 (Unaudited)
F-2
Condensed Consolidated Statements of Stockholder’s Equity for the three months ended September 30, 2022 and 2021 (Unaudited)
F-3
Condensed Consolidated Statements of Cash Flows for the three months ended September 30, 2022 and 2021 (Unaudited)
~~F-3~~F-5
Notes to Unaudited Condensed Consolidated Financial Statements
~~F-4~~F-6

4
Table of Contents

~~BANJO & MATILDA~~XERIANT, INC. ~~AND SUBSIDIARIES~~

CONDENSED CONSOLIDATED BALANCE SHEETS

December 31,

June 30,

2016

2016

(Unaudited)

ASSETS

CURRENT ASSETS

Cash and cash equivalents

$ 28,564

$ 11,056

Trade receivables, net

-

2,870

Inventory, net

129,272

102,427

Deposit on purchases

-

1,153

Other assets

5,500

-

TOTAL CURRENT ASSETS

163,336

117,506

NON-CURRENT ASSETS

Intangible assets, net

34,898

38,269

Deferred financing costs, net

24,709

31,407

Property, plant and equipment, net

10,023

11,976

TOTAL NON-CURRENT ASSETS

69,629

81,652

TOTAL ASSETS

$ 232,966

$ 199,157

LIABILITIES AND STOCKHOLDERS' DEFICIT
CURRENT LIABILITIES

Trade and other payables

$ 1,077,935

$ 1,008,772

Deposit payable

4,621

4,621

Trade financing

196,119

249,720

Accrued interest

370,885

236,398

Loans payable

689,269

306,092

Loan from related parties

181,737

183,269

Convertible loan from related parties (net of related discount)

377,724

370,008

TOTAL CURRENT LIABILITIES

2,898,290

2,358,880

NON-CURRENT LIABILITIES

Loans payable (net of related discount) (net of current portion)

171,903

325,137

TOTAL LIABILITIES

3,070,193

2,684,017

STOCKHOLDERS' DEFICIT

Preferred stock, $0.00001 par value, 100,000,000 shares authorized

and 1,000,000 shares issued and outstanding, respectively

10

10

Common stock, $0.00001 par value, 100,000,000 shares authorized and

58,823,116 and 58,823,116 shares issued and outstanding, respectively

588

588

Additional paid in capital

1,632,517

1,632,517

Other accumulated comprehensive gain

100,007

100,007

Accumulated deficit

(4,570,349 )

(4,217,982 )
TOTAL STOCKHOLDERS' DEFICIT

(2,837,226 )

(2,484,860 )

TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT

$ 232,966

$ 199,157

	As of			As of
	September 30, 2022			June 30, 2022
Assets	(Unaudited)
Current assets
Cash	$	498,039		$	1,065,945
Deposits		12,546			12,546
Investment in JV - Ebenberg LLC		107,007			57,678
Prepaids		8,231			756
Total current assets		625,823			1,136,925
Property & equipment, net		6,641			4,409
Operating lease right-of-use asset		117,437			128,342
Total assets	$	749,901		$	1,269,676

Liabilities & stockholders’ deficit
Current liabilities
Accounts payable and accrued liabilities	$	69,697		$	56,836
Accrued liabilities, related party		32,000			22,000
Shares to be issued		75,200			75,200
Convertible notes payable, net of discount		5,950,000			3,936,185
Lease liability, current		50,647			48,963
Total current liabilities		6,177,544			4,139,184

Lease liability, long-term		79,020			92,197
Total liabilities		6,256,564			4,231,381

Commitments and contingencies (Note 9)

Stockholders’ deficit
Series A Preferred stock, $0.00001 par value; 100,000,000 authorized; 3,500,000 designated; 780,132 and 781,132 shares issued and outstanding at September 30, 2022 and June 30, 2022, respectively		8			8
Series B Preferred stock, $0.00001 par value; 100,000,000 authorized; 1,000,000 designated; 1,000,000 issued and outstanding at September 30, 2022 and June 30, 2022, respectively		10			10
Common stock, $0.00001 par value; 5,000,000,000 shares authorized; 365,696,144 and 365,239,001 shares issued and outstanding at September 30, 2022 and June 30, 2022, respectively		3,657			3,652
Common stock to be issued		51,950			51,950
Additional paid in capital		18,624,349			16,351,791
Accumulated deficit		(21,381,601	)		(16,571,505	)
Total stockholder’s deficit		(2,701,627	)		(164,094	)
Non-controlling interest		(2,805,036	)		(2,797,611	)
Total stockholders’ deficit		(5,506,663	)		(2,961,705	)
Total liabilities and stockholders’ deficit	$	749,901		$	1,269,676

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

F-1
Table of Contents

~~BANJO & MATILDA,~~XERIANT, INC. ~~AND SUBSIDIARIES~~

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS ~~AND COMPREHENSIVE (LOSS) INCOME~~

~~FOR THE THREE AND SIX MONTH PERIODS ENDED DECEMBER 31, 2016 AND 2015~~

(UNAUDITED)

Three month periods ended

Six month periods ended

December 31,
2016

December 31,
2015

December 31,
2016

December 31,
2015

Revenue

$ 159,115

$ 732,063

$ 360,042

$ 1,612,367

Cost of sales

46,417

517,152

143,747

1,088,959

Gross profit

112,698

214,911

216,295

523,408

Payroll and employee related expenses

123,879

131,688

246,362

393,653

Operating expense

20,818

42,725

40,922

105,445

Marketing expense

17,136

23,501

34,917

91,921

Samples & design expense

6,055

7,466

7,761

44,069

Occupancy expenses

11,461

23,350

26,058

36,715

Depreciation and amortization expense

2,662

2,291

5,324

4,556

Finance Charges

18,450

12,299

27,258

27,680

Corporate and public company expense

7,125

40,898

14,547

73,285

207,587

284,219

403,150

777,324

Loss from operations

(94,889 )

(69,307 )

(186,855 )

(253,916 )

Other Income (Expense)

Interest income

-

-

Other income

3,390

(9,846 )

4,077

2,832

Amortization of debt discount

(16,393 )

(18,093 )

(32,785 )

(36,187 )
Interest expense

(68,966 )

(52,120 )

(136,804 )

(115,453 )
Total Other Expense

(81,969 )

(80,059 )

(165,512 )

(148,808 )

Loss before income tax

(176,858 )

(149,367 )

(352,367 )

(402,724 )

Provision for income taxes

-

-

-

-

Net loss

(176,858 )

(149,367 )

(352,367 )

(402,724 )

Other comprehensive income

Foreign currency translation

-

-

-

-

Comprehensive loss

$ (176,858 ) $ (149,367 )

$ (352,367 ) $ (402,724 )

Net loss per share

Basic

$ (0.00 ) $ (0.00 )

$ (0.01 ) $ (0.01 )
Diluted

$ (0.00 ) $ (0.00 )

$ (0.01 ) $ (0.01 )

Weighted average number of shares outstanding:

Basic

58,823,116

58,823,116

58,823,116

58,722,023

Diluted

58,823,116

58,823,116

58,823,116

58,722,023

	For the three months ended
	September 30, 2022			September 30, 2021
Operating expenses:
General and administrative expenses	$	545,569		$	1,201,002
Professional fees		90,060			29,541
Related party consulting fees		94,000			82,500
Research and development expense		-			2,340,575
Sales and marketing expense		6,356			598,595
Total operating expenses		735,985			4,252,213

Loss from operations		(735,985	)		(4,252,213	)

Other expenses:
Amortization of debt discount		(461,842	)		(149,028	)
Financing fees		-			(43,750	)
Interest expense		-			(2,389	)
Loss from Ebenberg JV		(49,328	)		-
Loss on extinguishment of debt		(3,570,366	)		(535	)
Total other (expense)		(4,081,536	)		(195,702	)

Net loss		(4,817,521	)		(4,447,915	)

Less net loss attributable to noncontrolling interest		(7,425	)		(1,177,816	)

Net income attributable to common stockholders	$	(4,810,096	)	$	(3,270,099	)

Net loss per common share - basic and diluted	$	(0.01	)	$	(0.01	)

Weighted average number of common shares outstanding - basic and diluted		361,552,863			225,497,197

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

F-2
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XERIANT, INC.

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ DEFICIT

FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2022

(UNAUDITED)

~~BANJO & MATILDA, INC. AND SUBSIDIARIES~~

~~CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS~~

~~FOR THE SIX MONTH PERIODS ENDED DECEMBER 31, 2016 AND 2015~~

~~(UNAUDITED)~~

December 31,
2016

December 31,
2015

Net loss

$ (352,367 )

$ (402,724 )
Adjustments to reconcile net loss to net cash

used in operating activities:

Depreciation

1,953

1,185

Amortization

3,371

3,371

AR allowance

(8,772 )

873

Debt discount amortization

32,785

36,187

Amortization of deferred finance fee

7,851

7,851

(Increase) / decrease in assets:

-

Trade receivables

11,642

16,808

Inventory

(26,845 )

40,962

Deposit on Purchases

1,153

356,651

Other assets

(5,500 )

(235,650 )
Other receivable

-

66,952

Deferred financing costs

(1,153 )

-

Increase/ (decrease) in current liabilities:

Trade payables and other liabilities

69,162

5,202

Accrued interest

134,487

58,350

Net cash used in operating activities

(132,233 )

(43,983 )

CASH FLOWS FROM INVESTING ACTIVITIES

Purchase of property and equipment

-

(2,334 )

CASH FLOWS FROM FINANCING ACTIVITIES

Net proceeds (net payments) on related party loan

(1,532 )

268,971

Proceeds from loan payables

-

(340,886 )
Net proceeds (net payments) on loan payables

204,875

-

Net trade financing

(53,601 )

(130,151 )
Net cash provided by (used in) financing activities

149,742

(202,066 )

Net increase (decrease) in cash and cash equivalents

17,508

(248,383 )

Cash and cash equivalents at the beginning of the period

$ 11,056

$ 362,668

Cash and cash equivalents at the end of the period

$ 28,564

$ 114,285

SUPPLEMENTAL DISCLOSURES:

Cash paid during the year for:

Income tax payments

$ -

$ -

Interest payments

$ 12,082

$ 64,953

SUPPLEMENTAL DISCLOSURES FOR NON CASH:

FINANCING AND INVESTING ACTIVITIES

Debt converted to equity

$ -

$ 27,123

	Series A					Series B								Additional			Common					Non-
	Preferred Stock					Preferred Stock				Common Stock				Paid in			stock to		Accumulated			Controlling
	Shares			Amount		Shares		Amount		Shares		Amount		Capital			be issued		Deficit			Interest			Total
Balance June 30, 2022		781,132		$	8		1,000,000	$	10		365,239,001	$	3,652		16,351,791		$	51,950	$	(16,571,505	)	$	(2,797,611	)	$	(2,961,705	)

Stock issued for services		-			-		-		-		457,143		5		47,995			-		-			-			48,000

Conversion of Series A Preferred to Common Stock		(1,000	)		-		-		-		1,000,000		10		(10	)		-		-			-			-

Fair value of warrants associated with convertible debt		-			-		-		-		-		-		1,918,393			-		-			-			1,918,393

Adjustment for rounding		-			-		-		-		-		5		(5	)		-		-			-			-

Stock option compensation		-			-		-		-		-		-		306,170			-		-			-			306,170

Net Loss		-			-		-		-		-		-		-			-		(4,810,096	)		(7,425	)		(4,817,521	)

Balance September 30, 2022		780,132		$	8		1,000,000	$	10		365,696,144	$	3,657		18,624,349		$	51,950	$	(21,381,601	)	$	(2,805,036	)	$	(5,506,663	)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

F-3
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XERIANT, INC.

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY

FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2021

(UNAUDITED)

	Series A					Series B								Additional			Common						Non-
	Preferred Stock					Preferred Stock				Common Stock				Paid in			stock to			Accumulated			Controlling
	Shares			Amount		Shares		Amount		Shares		Amount		Capital			be issued			Deficit			Interest			Total
Balance June 30, 2021		788,270			8		1,000,000		10		292,815,960		2,925		4,138,194			51,090			(3,270,235	)		(216,686	)		705,306

Issuance of common stock committed in prior period		-			-		-		-		400,000		4		47,996			(48,000	)		-			-			-

Sale of common stock		-			-		-		-		7,500,000		75		499,925			1,168,500			-			-			1,668,500

Shares issued as equity kicker		-			-		-		-		250,000		3		43,750			-			-			-			43,753

Exercise of warrants		-			-		-		-		4,185,000		41		125,509			3,000			-			-			128,550

Conversion of Series A Preferred to Common Stock		(4,000	)		-		-		-		4,000,000		40		(40	)		-			-			-			-

Conversion of convertible notes and accrued interest		-			-		-		-		10,598,544		106		176,054			(3,090	)		-			-			173,070

Stock issued for services		-			-		-		-		2,825,000		27		449,173			91,900			-			-			541,100

Stock option compensation		-			-		-		-		-		-		1,060,324			-			-			-			1,060,324

Fair value of beneficial conversion feature associated with convertible debt		-			-		-		-		-		-		250,000			-			-			-			250,000

Net Loss		-			-		-		-		-		-		-			-			(3,270,099	)		(1,117,816	)		(4,447,915	)

Balance September 30, 2021		784,270		$	8		1,000,000	$	10		322,574,504	$	3,221	$	6,790,885		$	1,263,400		$	(6,540,334	)	$	(1,394,502	)	$	122,688

~~BANJO & MATILDA, INC. AND SUBSIDIARIES~~

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

F-4

Table of Contents

XERIANT, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

	For the three months ended
	September 30, 2022			September 30, 2021
Cash Flows from Operating Activities
Net Loss	$	(4,817,521	)	$	(4,447,915	)
Adjustments to reconcile net loss to net
cash used by operating activities:
Depreciation and amortization		335			-
Stock option expense		306,170			1,060,324
Stock issued for services		48,000			494,700
Loss on extinguishment of debt		3,470,366			535
Loss from joint venture investment		(49,328	)		-
Amortization of debt discount		461,842			149,028
Operating lease right of use asset		10,905			245
Changes in operating assets & liabilities:
Lease liabilities		(11,493	)		-
Deposits and prepaids		(7,476	)		(34,850	)
Accounts payable and accrued liabilities		12,861			50,191
Accrued liability, related party		10,000			-
Net cash used by operating activities		(565,339	)		(2,727,742	)

Cash Flows from Investing Activities
Purchase of property and equipment		(2,567	)		-
Net cash used in investing activities		(2,567	)		-

Cash Flows from Financing Activities
Sale of common stock		-			1,668,500
Cash from exercise of warrants		-			128,549
Proceeds from convertible notes payable		-			250,000
Net cash provided by financing activities		-			2,047,049

Decrease in Cash		(567,906	)		(680,693	)

Cash at beginning of period		1,065,945			962,540

Cash at end of period	$	498,039		$	281,847

Supplemental Cash Flow Information
Cash paid for interest	$	-		$	-
Cash paid for income taxes	$	-		$	-

Non-cash investing and financing activities:
Conversion of convertible notes payable and accrued interest	$	-		$	187,246
Warrants issued with convertible notes payable	$	-		$	117,893
Beneficial conversion feature arising from convertible notes payable	$	-		$	171,597
Warrants issued with convertible notes payable extinguishment	$	1,918,393		$	-

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements

F-5

Table of Contents

XERIANT, INC.

NOTES TO ~~UNAUDITED~~ CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

~~Note~~NOTE 1 ~~– BASIS~~- ORGANIZATION AND NATURE OF ~~PRESENTATION AND ORGANIZATION~~BUSINESS

~~All currencies represented in~~Company Overview

Xeriant, Inc. (“Xeriant” or the ~~notes~~“Company”) is dedicated to the ~~condensed consolidated financial statements are~~acquisition, development and commercialization of transformative technologies, including eco-friendly specialty materials which can be successfully deployed and integrated across multiple industry sectors, and disruptive innovations related to the emerging aviation market called Advanced Air Mobility, which include next-generation aircraft. We seek to partner with and acquire strategic interests in ~~United States Dollars (USD) unless specified as AUD (Australian Dollars).~~visionary companies that accelerate this mission.

~~Banjo and Matilda, Inc.~~The Company was incorporated in Nevada on December 18, ~~2009 under the name Eastern World Group, Inc. On September 24, 2013, its name was changed to Banjo & Matilda, Inc.~~2009.

On ~~November 14, 2013, Banjo & Matilda, Inc.,~~April 16, 2019, the Company entered into a Share Exchange Agreement ~~(the "Exchange Agreement")~~ with ~~Banjo & Matilda, Pty Ltd.~~American Aviation Technologies, LLC (“AAT”), ~~a corporation formed under~~an aircraft design and development company focused on the ~~laws of Australia (the "Company") and the shareholders~~emerging segment of the ~~Company. Pursuant to~~aviation industry of autonomous and semi-autonomous vertical take-off and landing (VTOL) unmanned aerial vehicles (UAVs).

On September 30, 2019, the ~~Exchange Agreement, at the closing~~acquisition of AAT closed, and AAT became a subsidiary of the ~~transaction contemplated thereunder (the "Transaction"),~~Company.

On June 22, 2020, the name of the Company ~~became a wholly-owned subsidiary of Banjo & Matilda,~~was changed to Xeriant, Inc.

Banjo & Matilda Pty Ltd. was incorporated under the laws of Australia on May 27, 2009 and manufactures and sells cashmere fashion. Headquartered at Bondi Beach, the Aussie lifestyle of sun, sand and surf resonates innately with this label and its philosophy of low maintenance, style and comfort.

~~Banjo & Matilda USA, Inc. was incorporated~~ in the State of ~~Delaware on October 14, 2013~~Nevada and subsequently approved by FINRA effective July 30, 2020 for the name and symbol change (XERI).

On May 31, 2021, the Company entered into a Joint Venture Agreement with XTI Aircraft Company, to form a new company, called Eco-Aero, LLC, for purpose of completing the preliminary design of XTI’s TriFan 600, a 5-passenger plus pilot, hybrid electric, vertical takeoff and landing (eVTOL) fixed wing aircraft.

Effective April 2, 2022 (the “Effective Date”) and Amended November 7, 2022, the Company entered into a Joint Venture Agreement (the “Joint Venture Agreement”) with Movychem s.r.o., a Slovakian limited liability company (“Movychem”) setting forth the terms for the establishment of a joint venture (the “Joint Venture”) to develop applications and commercialize a series of flame retardant products in the form of polymer gels, powders, liquids and pellets derived from technology developed by Movychem under the name Retacell™. The Joint Venture is organized as a Florida limited liability company under the name Ebenberg, LLC and is owned ~~100%~~50% by ~~Banjo & Matilda, Inc.~~each of the Company and Movychem.

Advanced Materials

A primary focus of our Company is the acquisition and commercial exploitation of eco-friendly, advanced materials and chemicals which have applications across a broad range of industries and the potential to generate significant near-term revenue. The ~~ultra-soft cashmere staples, pairing simplicity~~Company’s commercialization strategy encompasses licensing arrangements and joint ventures with ~~cool sophistication has rapidly gained loyal customers worldwide positioning~~major industry players, which would allow for more rapid access to the ~~label~~market with reduced capital requirements and financial risk. In addition to providing the production and distribution infrastructure, these established partnering companies can streamline testing and certification and add brand recognition value. The advanced materials and chemicals may be sold as standalone products, enhancements to existing products, or used in the development of proprietary products under a new trademarked brand owned by the Company. The Company is exploring manufacturing and branding opportunities for specific products derived from advanced materials and chemicals acquired or developed, which would involve setting up production facilities, equipment, systems and supply chain. Our plan to source and acquire strategic interests in visionary companies developing, integrating, and commercializing critical breakthrough technologies is underway with our first successful advanced materials transaction executed in the second quarter of 2022.

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Effective April 2, 2022, we entered into a Joint Venture Agreement with Movychem s.r.o, a Slovakian chemicalcompany, setting forth the terms for a joint venture (referred to herein as the ~~'go-to'~~Movychem JV) to develop applications and commercialize a series of productswhich incorporate an internationally patented flame-retardant technology developed by Movychem under the trade name Retacell^®. The Movychem JV, owned 50% by Xeriant and 50% by Movychem, subject to certain funding conditions, has been granted the exclusive worldwide rights to the intellectual property related to Retacell^® and will be responsible for ~~contemporary cashmere products.~~developing applications and commercializing products derived from Retacell^®. Engineered over two decades, Retacell^® is a versatile, biodegradable, non-toxic, high-performance thermal and fire protection chemical agent that is custom formulated for each application, based on the specific properties of the base material and the fire protection requirements. Retacell^® can be applied as a coating, treatment, or infused during manufacturing into a variety of materials, including recycled plastics and wood-based fiber. In addition to becoming heat and fire resistant, the resulting Retacell^®-enhanced materials are also water resistant.

~~Under accounting principles generally accepted~~On June 8, 2022, we announced the successful development of a multi-purpose, high-strength fire- and water-resistant composite panel made from a formulation of Retacell^® and a cardboard fiber-reinforced polymeric resin, which can be sourced from recycled materials. The panel is fabricated through a compression molding process and may be produced or cut in varying thicknesses and sizes, including standard 48” x 96” sheets. Depending on the application, the panel can have different colors, textures or decorative finishes. Potential interior and exterior construction applications include walls, ceilings, flooring, framing, siding, roofing, and decking.

Xeriant, pursuant to the Services Agreement with the Movychem JV, is planning to buildout manufacturing facilities in the United States and Eastern Europe to meet the ~~share exchange is considered~~demand for Retacell^® and Retacell^®-infused products. The manufacturing facilities will be owned and operated by Xeriant, and will wholesale product to becustomers licensed by the Movychem JV. We have identified potential sites, received bids for specialized manufacturing equipment, developed timetables related to the action plan, and hired a ~~capital transaction in substance, rather than a business combination. That~~managing director with decades of experience to oversee the projects.

Aerospace

Another area of interest for our Company is the ~~share exchange~~emerging aviation market called Advanced Air Mobility (AAM), the transition to more efficient, eco-friendly, automated and convenient flight operations enabled by the convergence of technological advancements in design and engineering, composite materials, propulsion systems, battery energy density and manufacturing processes. Next-generation aircraft being developed for this market offer low-cost, on-demand flight for passengers and cargo, utilizing lower altitude airspace and bypassing the traditional hub and spoke airport network with vertical takeoff and landing (VTOL) capabilities. Many of these lightweight aircraft are electrically powered through either hybrid or pure battery systems, which allows for quieter, low emission flights over urban areas, however with limited speed and range. The adoption and integration of niche aerial services through AAM is ~~equivalent~~expected to provide benefits throughout the ~~issuance~~economy. We plan to partner with and acquire strategic interests in visionary companies that accelerate our mission of ~~stock by Banjo & Matilda Pty Ltd.~~commercializing critical breakthrough AAM technologies which enhance performance, increase safety, and enable and support more efficient, autonomous, and sustainable flight operations, including electric and hybrid-electric passenger and cargo transport aircraft capable of vertical takeoff and landing. Our plan to source and acquire strategic interests in leading aerospace companies developing breakthrough VTOL aircraft began in the second quarter of 2021.

Effective May 27, 2021, we entered into a Joint Venture Agreement with XTI Aircraft Company (“XTI”), a privately owned OEM based in Englewood, Colorado for the ~~net monetary assets~~purpose of completing the preliminary design of XTI’s TriFan 600, a 5-passenger plus pilot, hybrid electric vertical takeoff and landing (eVTOL) fixed-wing aircraft.

Through our joint venture with XTI, (referred to hereinafter as the “XTI JV”), we were involved in the successful completion of the ~~Banjo & Matilda, Inc. accompanied by a recapitalization,~~preliminary design of their TriFan 600 eVTOL aircraft. The TriFan 600 is being designed to become the fastest, longest-range VTOL aircraft in the world and the first commercial fixed-wing VTOL airplane, with current pre-orders exceeding $3 billion in gross revenues upon delivery of those aircraft.

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While the purpose of the XTI JV has been achieved, XTI and Xeriant continue to see value in the XTI JV for future collaboration in Advanced Ari Mobility. Should XTI and Xeriant determine it is ~~accounted for as a change~~ in ~~capital structure. Accordingly,~~their best interest to terminate the ~~accounting for the share exchange~~XTI JV, then it will be ~~identical to that resulting from a reverse acquisition, except no goodwill will~~dissolved. Should the XTI JV be ~~recorded. Under share reverse takeover accounting, the post reverse acquisition comparative historical financial statements~~dissolved, as of ~~the legal acquirer, Banjo & Matilda, Inc. are those~~October 18, 2022, Xeriant would receive 5.5% equity ownership of ~~the legal acquiree, Banjo & Matilda Pty Ltd., which is considered to be the accounting acquirer. Share and per share amounts stated have been retroactively adjusted to reflect the merger.~~XTI.

Management believes that our holding and operating company structure has several advantages and will enable us to grow rapidly, acquiring assets primarily through acquisitions, joint ventures, strategic investments, and licensing arrangements. As a ~~result~~publicly traded company, we offer our subsidiaries such benefits as improved access to capital, higher valuations and lower risk through the shared ownership of ~~the exchange agreement, the reorganization was treated~~a diversified portfolio, while allowing these entities to maintain independence in their distinct operations to focus on their fields of expertise. Cost savings and efficiencies may be realized from sharing non-operational functions such as ~~an acquisition by the accounting acquiree that is being accounted for~~finance, legal, tax, sales & marketing, human resources, purchasing power, as ~~a recapitalization~~well as investor and as a reverse merger by the legal acquirer for accounting purposes. Pursuant to the recapitalization, all capital stock shares and amounts and per share data have been retroactively restated. Accordingly, the financial statements include the following:public relations.

~~(1)~~
~~The balance sheet consists of the net assets of the accounting acquirer at historical cost and the net assets of the legal acquirer at fair value.~~
~~(2)~~
~~The statements of operations include the operations of the accounting acquirer for the period presented and the operations of the legal acquirer from the date of the merger.~~
Additionally, we are leveraging our relationship with Florida Atlantic University to provide a collaborative research arm for technologies that require additional validation and the backing of a respected research institution for credibility. The university also may provide access to various grants through the SBIR (Small Business Innovation Research), STTR (Small Business Technology Transfer, NSF (National Science Foundation) and other programs, and if warranted, introductions into a number of government agencies, such as DOD (Department of Defense) and DARPA (Defense Advanced Research Projects Agency). We are pursuing strategic alliances with companies that provide complementary technologies and access to new markets.

~~Note~~NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The ~~accompanying~~consolidated financial statements, ~~were~~which include the accounts of the Company, American Aviation Technologies, LLC, and Eco-Aero, LLC, its subsidiaries, are prepared in conformity with generally accepted accounting principles in the United States of America ("(U.S. GAAP). All significant intercompany balances and transactions have been eliminated. The consolidated financial statements, which include the accounts of the Company and its wholly owned subsidiaries, and related disclosures have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The Financial Statements have been prepared using the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and presented in US ~~GAAP").~~dollars. The fiscal year end is June 30.

Going Concern

The Company’s financial statements are prepared using the generally accepted accounting principles applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. At September 30, 2022 and June 30, 2022, the Company had $498,039 and $1,065,945 in cash and $5,551,721 and $3,002,259 in negative working capital, respectively. For the three months ended September 30, 2022 and 2021, the Company had a net loss of $4,817,521 and $4,447,915, respectively. Continued losses may adversely affect the liquidity of the Company in the future. Therefore, the factors noted above raise substantial doubt about our ability to continue as a going concern. The recoverability of a major portion of the recorded asset amounts shown in the accompanying balance sheets is dependent upon continued operations of the Company, which in turn is dependent upon the Company’s ability to raise additional capital, obtain financing and to succeed in its future operations. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. The Company’s existence is dependent upon management’s ability to develop profitable operations and resolve its liquidity problems.

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NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Principles of Consolidation

The consolidated financial statements include the accounts of ~~Banjo & Matilda, Inc. ("Banjo" or "the Company") and its wholly owned subsidiaries Banjo & Matilda Pty Ltd. and Banjo & Matilda USA,~~Xeriant, Inc., ~~collectively referred to as the Company.~~American Aviation Technologies, LLC, and Eco-Aero, LLC. All ~~material~~significant intercompany ~~accounts,~~balances and transactions ~~and profits were eliminated in consolidation.~~have been eliminated.

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~~Table of Contents~~

~~Exchange Gain (Loss)~~

During the six-month periods ended December 31, 2016 and 2015, the transactions of the Company were denominated in US Dollars. Some transactions were denominated in AUD and British pounds for the sales made outside US and for rent paid for the Australian store. Such transactions were converted to US$ on the date of transaction and the exchange gains or losses were recorded in the statement of operations.

~~Foreign Currency Translation and Comprehensive Income (Loss)~~

During the six-month period ended December 31, 2016 ad 2015, the transactions of the Company were denominated in US Dollars. All the transactions which were denominated in other currencies were converted to US$ on the date of settlement and the exchange gains and losses were recorded in the statement of operations. No change was recorded in the comprehensive income (loss).

Use of Estimates

The preparation of financial statements in conformity with ~~US GAAP~~accounting principles generally accepted in the United States of America requires management to make ~~certain~~ estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The most significant assumptions and estimates relate to the valuation of beneficial conversion features and warrants associated with convertible debt. Actual results could differ from ~~those~~these estimates. ~~Significant estimates include collectability of accounts receivable, accounts payable, sales returns and recoverability of long-term assets.~~

~~Reportable Segment~~Fair Value Measurements and Fair Value of Financial Instruments

The Company has one reportable segment. The Company's activities are interrelated and each activity is dependent upon and supportive of the other. Accordingly, all significant operating decisions are based on analysis of financial products provided as a single global business.

~~Revenue Recognition~~

Revenue is recognized when persuasive evidence of an arrangement exists, delivery has occurred, the fee is fixed or determinable, and collectability is probable. Revenue generally is recognized net of allowances for returns and any taxes collected from customers and subsequently remitted to governmental authorities.

~~Cost of Sales~~

Cost of sales consists primarily of inventory costs, as well as warehousing costs (including the cost of warehouse labor), shipping, importation duties and charges, third party royalties, and product sampling.

~~Operating Overhead Expense~~

~~Operating overhead expense consists primarily of payroll and benefit related costs, rent, depreciation and amortization, professional services, and meetings and travel.~~

~~Income Taxes~~

The Company utilizes FASB Accounting Standards Codification (ASC) Topic 740, Income Taxes, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that were included in the financial statements or tax returns. Under this method, deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each period end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.

The Company follows FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes, (codified in FASB ASC Topic 740). When tax returns are filed, it is likely that some positions taken would be sustained upon examination by the taxing authorities, while others are subject to uncertainty about the merits of the position taken or the amount of the position that would be ultimately sustained. The benefit of a tax position is recognized in the financial statements in the period during which, based on all available evidence, management believes it is more likely than not that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions taken are not offset or aggregated with other positions. Tax positions that meet the more-likely-than-not recognition threshold are measured as the largest amount of tax benefit that is more than 50 percent likely of being realized upon settlement with the applicable taxing authority. The portion of the benefits associated with tax positions taken that exceeds the amount measured as described above is reflected as a liability for unrecognized tax benefits in the accompanying balance sheets along with any associated interest and penalties that would be payable to the taxing authorities upon examination. Interest associated with unrecognized tax benefits is classified as interest expense and penalties are classified in selling, general and administrative expenses in the statements of income.

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~~Table of Contents~~

At December 31, 2016 and 2015, the Company had not taken any significant uncertain tax positions on its tax returns for periods ended December 31, 2016 and prior years or in computing its tax provision for 2016. Management has considered its tax positions and believes that all of the positions taken by the Company in its Federal and State tax returns are more likely than not to be sustained upon examination. The Company is subject to examination by U.S. Federal and State tax authorities from the period ended June 30, 2013 to the present, generally for three years after they are filed.

~~The Company has been behind in filing its payroll tax returns and sales tax returns. The Company has recorded $2,180 as penalties for the late payment of taxes in the accompanying financials.~~

~~Concentration of Credit Risk~~

Financial instruments that potentially subject the Company to concentrations of credit risk are cash, accounts receivable and other receivables arising from its normal business activities. The Company places its cash in what it believes to be credit-worthy financial institutions. The Company has a diversified customer base across many markets, predominantly Australia, United States of America, United Kingdom, Europe and the Middle East. The Company controls credit risk related to accounts receivable through credit approvals, credit limits and monitoring procedures. The Company routinely assesses the financial strength of its customers and, based upon factors surrounding the credit risk, establishes an allowance, if required, for uncollectible accounts and, as a consequence, believes that its accounts receivable credit risk exposure beyond such allowance is limited. In addition, Receivables that are factored through the Company's Receivable finance facility are guaranteed by the finance company that further mitigates Credit Risk.

~~Risks and Uncertainties~~

The Company is subject to risks from, among other things, competition associated with the industry in general, other risks associated with financing, liquidity requirements, rapidly changing customer requirements, limited operating history, foreign currency exchange rates and the volatility of public markets.

~~Contingencies~~

Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company but which will only be resolved when one or more future events occur or fail to occur. The Company's management and legal counsel assess such contingent liabilities, and such assessment inherently involves judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or unasserted claims that may result in such proceedings, the Company's legal counsel evaluates the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought.

If the assessment of a contingency indicates it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company's financial statements. If the assessment indicates that a potential material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material would be disclosed. Loss contingencies considered to be remote by management are generally not disclosed unless they involve guarantees, in which case the guarantee would be disclosed.

~~Cash and Equivalents~~

Cash and equivalents include cash in hand and cash in demand deposits, certificates of deposit and all highly liquid debt instruments with original maturities of three months or less. At December 31, 2016 and June 30, 2016, the Company had $28,564 and $11,056 in cash in Australia and in the United States. The Company has not experienced any losses in such accounts and believes it is not exposed to any risks on its cash in bank accounts.

~~Allowance for Doubtful Accounts~~

The Company maintains reserves for potential credit losses on accounts receivable. Management reviews the composition of accounts receivable and analyzes historical bad debts, customer concentrations, customer credit worthiness, current economic trends and changes in customer payment patterns to evaluate the adequacy of these reserves. The allowances for doubtful accounts as of December 31, 2016 and June 30, 2016 are $139,098 and $147,870 respectively.

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~~Table of Contents~~

~~Inventory~~

Inventories are valued at the lower of cost (determined on a weighted average basis) or market. Management compares the cost of inventories with the market value and allowance is made to write down inventories to market value, if lower. As of December 31,2016 and June 30, 2016, the Company had outstanding balances of Finished Goods Inventory in hand of $69,530 and $102,427 respectively. As of December 31,2016 and June 30, 2016, the Company had outstanding balances of Inventory in transit of $77,000 and $0 respectively.

~~The inventory reserve balance as of December 31, 2016 and June 30, 2016, was approximately $17,000 and $17,000, respectively.~~

~~Property, Plant & Equipment~~

Property and equipment is stated at cost and depreciated using the straight-line method over the shorter of the estimated useful life of the asset or the lease term. The estimated useful lives of our property and equipment are generally as follows: computer software developed or acquired for internal use, three to 10 years; computer equipment, two to three years; buildings and improvements, five to 15 years; leasehold improvements, two to 10 years; and furniture and equipment, one to five years.

~~As of December 31, 2016 and June 30, 2016, Plant and Equipment consisted of the following:~~

December 31

June 30

2016

2016

Property, plant & equipment

$ 31,378

$ 31,378

Accumulated depreciation

$ (21,355 )

$ (19,402 )

$ 10,023

$ 11,976

Depreciation was $1,953 and $1,185 for the three-month periods ended December 31, 2016 and 2015, respectively. Depreciation was $976 and $605 for the three-month periods ended December 31, 2016 and 2015, respectively.

~~Fair Value of Financial Instruments~~

For certain of the Company's financial instruments, including cash and equivalents, restricted cash, accounts receivable, accounts payable, accrued liabilities and short-term debt, the carrying amounts approximate their fair values due to their short maturities.adopted ASC Topic 820, ~~"Fair~~Fair Value ~~Measurements and Disclosures," requires disclosure~~Measurements. ASC Topic 820 clarifies the definition of ~~the~~ fair value, ~~of financial instruments held by the Company. ASC Topic 825, "Financial Instruments," defines~~prescribes methods for measuring fair value, and establishes a ~~three-level valuation hierarchy for disclosures of~~ fair value ~~measurement that enhances disclosure requirements for~~hierarchy to classify the inputs used in measuring fair value measures. The carrying amounts reported in the balance sheets for receivables and current liabilities each qualify as financial instruments and are a reasonable estimate of their fair values because of the short period of time between the origination of such instruments and their expected realization and their current market rate of interest. The three levels of valuation hierarchy are defined as follows:

Level ~~1 inputs to the valuation methodology~~1: Inputs are unadjusted quoted prices in active markets for identical assets or liabilities ~~in active markets.~~available at the measurement date.

Level ~~2 inputs to the valuation methodology include~~2: Inputs are unadjusted quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, inputs other than quoted prices that are observable, ~~for~~and inputs derived from or corroborated by observable market data.

Level 3: Inputs are unobservable inputs which reflect the reporting entity’s own assumptions on what assumptions the market participants would use in pricing the asset or liability ~~either directly or indirectly, for substantially~~based on the ~~full term~~best available information.

The estimated fair value of certain financial instruments, including all current liabilities are carried at historical cost basis, which approximates their fair values because of the ~~financial instrument.~~short-term nature of these instruments.

~~Level 3~~The inputs to the valuation methodology ~~are unobservable~~of stock options and ~~significant~~warrants were under level 3 fair value measurements.

Cash and Cash Equivalents

For purposes of the Statements of Cash Flows, the Company considers highly liquid investments with an original maturity of three months or less to be cash equivalents. The Company has no cash equivalents.

Convertible Debentures

If the conversion features of conventional convertible debt provide for a rate of conversion that is below market value at issuance, this feature is characterized as a beneficial conversion feature (“BCF”). A BCF is recorded by the Company as a debt discount pursuant to ASC Topic 470-20 “Debt with Conversion and Other Options.” In those circumstances, the convertible debt is recorded net of the discount related to the ~~fair value measurement.~~BCF, and the Company amortizes the discount to interest expense, over the life of the debt. During the year ended June 30, 2022, the Company recorded a BCF in the amount of $2,615,419.

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NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Stock-based Compensation

The Company ~~analyzes all financial instruments with features~~measures the cost of ~~both liabilities and~~employee services received in exchange for equity ~~under ASC 480, "Distinguishing Liabilities from Equity," and ASC 815.~~incentive awards based on the grant date fair value of the award. The Company uses the Black-Scholes valuation model to calculate the fair value of stock options granted to employees or consultants. Stock-based compensation expense is recognized over the period during which the employee is required to provide services in exchange for the award, which is usually the vesting period.

AsResearch and Development Expenses

Expenditures for research and development are expensed as incurred. The Company incurred research and development expenses of ~~December 31, 2016~~$0 and ~~June~~$2,340,575 for the three months ended September 30, ~~2016,~~2022 and 2021, respectively.

Advertising and Marketing Expenses

The Company expenses advertising and marketing costs as they are incurred. The Company recorded advertising expenses in the amount of $15,442 and $168,087 for the three months ended September 30, 2022 and 2021, respectively.

Income Taxes

The Company ~~did~~recognizes the effect of income tax positions only if those positions are more likely than not ~~identify~~of being sustained. Recognized income tax positions are measured at the largest amount that is more likely than not of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company records interest and penalties related to unrecognized tax benefits as a component of general and administrative expenses. Our consolidated federal tax return and any state tax returns are not currently under examination.

The Company follows Accounting Standards Codification subtopic 740-10, Income Taxes (“ASC 740-10”) for recording the provision for income taxes. Deferred tax assets and liabilities are computed based upon the difference between the financial statement and income tax basis of assets and liabilities using the enacted marginal tax rate applicable when the related asset or liability is expected to be realized or settled. Deferred income tax expenses or benefits are based on the changes in the asset or liability during each period. If available evidence suggests that ~~are~~it is more likely than not that some portion or all of the deferred tax assets will not be realized, a valuation allowance is required to reduce the deferred tax assets to the amount that is more likely than not to be ~~presented on~~realized. Future changes in such valuation allowance are included in the ~~balance sheet at fair value.~~provision for deferred income taxes in the period of change. Deferred income taxes may arise from temporary differences resulting from income and expense items reported for financial accounting and tax purposes in different periods.

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Basic Income (Loss) Per Share

~~Earnings Per~~Under the provisions of ASC 260, “Earnings per Share, ~~(EPS)~~

~~Basic EPS~~” basic loss per common share is computed by dividing ~~income~~net loss available to common shareholders by the weighted average number of shares of common ~~shares~~stock outstanding for the ~~period.~~periods presented. Diluted ~~EPS is computed similar to basic~~ net ~~income~~loss per share ~~except that the denominator is increased to include the number of additional common shares that would have been outstanding if all~~reflects the potential ~~common shares, warrants and stock options had been issued and~~dilution that could occur if ~~the additional common shares were dilutive. Diluted EPS is based on the assumption that all dilutive convertible shares and stock options were converted~~securities or exercised. Dilution is computed by applying the treasury stock method for the outstanding options and the if-converted method for the outstanding convertible preferred shares. Under the treasury stock method, options and warrants are assumedother contracts to ~~be exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained thereby were used to purchase~~issue common stock ~~at the average market price during the period. Under the if-converted method, convertible outstanding instruments are assumed to be~~were exercised or converted into common stock ator resulted in the ~~beginning~~issuance of common stock that would then share in the income of the ~~period (or at the time of issuance, if later).~~Company, subject to anti-dilution limitations.

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Table of Contents

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

The ~~following~~ table ~~sets for~~below presents the computation of basic and diluted earnings per share for the three months ended September 30, 2022 and ~~six month periods ended December 31, 2016 and 2015:~~2021:

	For the three months ended September 30, 2022			For the three months ended September 30, 2021
Numerator:
Net loss	$	(4,810,096	)	$	(3,270,099	)
Denominator:
Weighted average common shares outstanding—basic		361,552,863			225,497,197
Dilutive common stock equivalents		-			-
Weighted average common shares outstanding—diluted		361,552,863			225,497,197
Net loss per share:
Basic	$	(0.01	)	$	(0.02	)
Diluted	$	(0.01	)	$	(0.02	)

NOTE 3 – JOINT VENTURE

Three month periods ended

Six month periods ended

December 31,
2016

December 31,
2015

December 31,
2016

December 31,
2015

Basic and diluted

Net loss

$ (176,858 )

$ (149,367 )

$ (352,367 )

$ (402,724 )

Net loss per share

Basic

$ (0.00 )

$ (0.00 )

$ (0.01 )

$ (0.01 )
Diluted

$ (0.00 )

$ (0.00 )

$ (0.01 )

$ (0.01 )

Weighted average number of shares outstanding:

Basic & diluted

58,823,116

58,823,116

58,823,116

58,722,023

JV with XTI Aircraft

~~Intangible Assets~~On May 31, 2021, the Company entered into a Joint Venture Agreement (the “Agreement”) with XTI Aircraft Company (“XTI”), a Delaware corporation, to form a new company, called Eco-Aero, LLC (the “JV”), a Delaware limited liability company, with the purpose of completing the preliminary design of XTI’s TriFan 600, a 5-passenger plus pilot, hybrid electric, vertical takeoff, and landing (eVTOL) fixed wing aircraft. Under the Agreement, Xeriant is contributing capital, technology, and strategic business relationships, and XTI is contributing intellectual property licensing rights and know-how. XTI and the Company each own 50 percent of the JV. The JV is managed by a management committee consisting of five members, three appointed by the Company and two by XTI. The Agreement was effective on June 4, 2021, with an initial deposit of $1 million into the JV. Xeriant’s financial commitment is for up to $10 million, contributed as required by the aircraft development timeline and budget.

The Company ~~records identifiable intangible assets at fair value~~analyzed the transaction under ASC 810 Consolidation, to determine if the joint venture classifies as a Variable Interest Entity (“VIE”). The Joint Venture qualifies as a VIE based on the ~~date~~fact the JV does not have sufficient equity to operate without financial support from Xeriant. According to ASC 810-25-38, a reporting entity shall consolidate a VIE when that reporting entity has a variable interest (or combination of ~~acquisition and evaluates~~variable interests) that provides the ~~useful life~~reporting entity with a controlling financial interest on the basis of ~~each asset.~~the provisions in paragraphs 810-10-25-38A through 25-38J. The reporting entity that consolidates a VIE is called the primary beneficiary of that VIE. According to the JV operating agreement, the ownership interests are 50/50. However, the agreement provides for a Management Committee of five members. Three of the five members are from Xeriant. Additionally, Xeriant has an obligation to invest $10,000,000 into the JV. As such, Xeriant has substantial capital at risk. Based on these two factors, the conclusion is that Xeriant is the primary beneficiary of the VIE. Accordingly, Xeriant has consolidated the VIE.

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JV with Movychem

Finite-lived intangible assets primarily consist of software development capitalized. Finite-lived intangible assets are amortized on a straight-line basis and are tested for recoverability if events or changes in circumstances indicate that their carrying amounts may not be recoverable. These intangibles have useful lives ranging from 1 to 10 years. No events or changes in circumstances indicate that impairment existed as of December 31, 2016.

~~Going Concern~~

The accompanying financial statements have been prepared in conformity with generally accepted accounting principles, which contemplate the continuation of the Company as a going concern. The Company reported accumulated deficit of $4,570,349 as of December 31, 2016. The Company also incurred net losses of $352,367 and $402,724 for the six-month periods ended December 31, 2016 and 2015, respectively and had negative working capital for the six-month periods ended December 31, 2016 and 2015. To date, these losses and deficiencies have been financed principally through the loans from related parties and from third parties.

In view of the matters described, there is substantial doubt as to the Company's ability to continue as a going concern without a significant infusion of capital. We anticipate that we will have to raise additional capital to fund operations over the next 12 months. To the extent that we are required to raise additional funds to acquire properties, and to cover costs of operations, we intend to do so through additional offerings of debt or equity securities. There are no commitments or arrangements for other offerings in place, no guaranties that any such financings would be forthcoming, or as to the terms of any such financings. Any future financing will involve substantial dilution to existing investors.

~~Subsequent to the period ended December 31, 2016,~~On April 2, 2022 the Company entered into ~~an equity line funding agreement~~a Joint Venture Agreement with ~~Spider Investments, LLC to sell up to $1,500,000 of our common stock, subject to certain~~Movychem s.r.o., a Slovakian limited liability company setting forth the terms ~~and conditions some of which are out of our control, including~~for the ~~(i) filing and obtaining effectiveness~~establishment of a ~~registration statement registering~~joint venture (the “Joint Venture”) to develop applications and commercialize a series of flame-retardant products in the ~~issuance~~form of ~~our shares of common stock~~polymer gels, powders, liquids and pellets derived from technology developed by Movychem under the ~~Act~~name Retacell^™. The Joint Venture is organized as a Florida limited liability company under the name Ebenberg, LLC and is owned 50% by each of the Company and Movychem.

For its capital contribution to ~~be issued~~the Joint Venture, pursuant to a Patent and Exclusive License and Assignment Agreement (the “Patent Agreement”), Movychem is transferring to the Joint Venture all of its interest to the know-how and intellectual property relating to Retacell exclusive of all patents, and the Company is contributing the amount of $2,600,000 payable (a) $600,000 at the rate of $25,000 per month over a 24 month period and (b) $2,000,000 within five business days of a closing of a financing in which the Company receives net proceeds of at least $3,000,000 but in no event later than six months from the Effective Date (Amended to February 15, 2023, as per Amended Agreement). At such time as the Company makes its $2,000,000 payment (and assuming the Company is current with its then monthly capital contributions), pursuant to the ~~equity line~~Patent Agreement, Movychem will transfer all of its rights, title and ~~(ii) certain volume and other trading conditions~~interest to all of ~~our common stock. The~~the patents related to Retacell for an amount equal to aggregate cash contributions of the Company ~~plans~~ to ~~file~~ the ~~registration statement and~~Joint Venture plus 40% of all royalty payments received by the Joint Venture for the licensing of Retacell products. Pending assignment of the patents to ~~obtain effectiveness thereof as soon as practicable.~~the Joint Venture, pursuant to the Patent Agreement, Movychem has granted to the Joint Venture an exclusive worldwide license under the patents.

~~Recently Issued Accounting Pronouncements~~Concurrently with the execution of the Joint Venture Agreement, the Joint Venture will provide to the Joint Venture technical services related to the exploitation of the Retacell intellectual property and corporate, marketing. business development, communications and administrative services as requested by the Joint Venture in exchange for 40% of all royalty payments received by the Joint Venture for the licensing of Retacell products.

~~In November 2015,~~Under the ~~Financial Accounting Standards Board (FASB) issued ASU 2015-17, “Balance Sheet Classification~~Joint Venture Agreement, the Company has agreed to grant to certain individuals affiliated with Movychem five-year warrants (the “Warrants”) to purchase an aggregate of ~~Deferred Taxes” (ASU 2015-17), which changes how deferred taxes are classified~~170,000,000 shares of the Company’s common stock at an exercise price of $0.01 per share with vesting depending on the ~~balance sheet~~satisfaction of various milestones as described therein.

The Joint Venture Agreement grants to Movychem the right to dissolve the Joint Venture in the event that the Company fails to make any of its capital contributions in which case the Joint Venture will be required to grant back to Movychem all joint venture intellectual property and ~~is effective for financial statements issued for annual periods beginning after December 15, 2016, with early adoption permitted. ASU 2015-17 requires all deferred tax assets and liabilities~~the assignment to Movychem of any outstanding licenses. Additionally, the Services Agreement will be amended to provide that the 40% of royalties to be ~~classified~~paid by to the Company will be limited to licensees who were first introduced to the Joint Venture or Movychem, as ~~non-current. The Company is currently evaluating~~ the ~~impact of the adoption of this standard on its consolidated financial statements.~~case may be.

~~In January 2016,~~The Company analyzed the ~~FASB issued ASU 2016-01, “Recognition and Measurement of Financial Assets and Financial Liabilities” (ASU 2016-01), which requires equity investments that are not accounted for~~transaction under ASC 810 Consolidation, to determine if the equity method of accounting to be measured at fair value with changes recognized in net income and updates certain presentation and disclosure requirements. ASU 2016-01 is effective beginning after December 15, 2017.joint venture classifies as a Variable Interest Entity (“VIE”). The ~~adoption of this guidance is not expected to have~~Joint Venture qualifies as a ~~material impact~~VIE based on the ~~Company’s results~~fact the JV does not have sufficient equity to operate without financial support from both parties. According to ASC 810-25-38, a reporting entity shall consolidate a VIE when that reporting entity has a variable interest (or combination of ~~operations,~~variable interests) that provides the reporting entity with a controlling financial ~~position or disclosures.~~interest on the basis of the provisions in paragraphs 810-10-25-38A through 25-38J. The reporting entity that consolidates a VIE is called the primary beneficiary of that VIE. According to the JV operating agreement, the ownership interests are 50/50 and the agreement provides for a Management Committee of five members. Two of the five members are from Xeriant and Movychem, respectively and one is appointed by mutual agreement of the parties. Movychem is transferring to the Joint Venture all of its interest to the know-how and intellectual property relating to Retacell exclusive of all patents, and the Company is contributing cash. As such, both parties do not have substantial capital at risk. Based on these two factors, the conclusion is that no one is the primary beneficiary of the VIE. Accordingly, Xeriant has not consolidated the VIE.

As of September 30, 2022 and June 30, 2022, the Company contributed $214,014 and $115,356 to the joint venture, respectively.

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NOTE 4 – CONCENTRATION OF CREDIT RISKS

~~In February 2016,~~The Company maintains accounts with financial institutions. All cash in checking accounts is non-interest bearing and is fully insured by the ~~FASB issued ASU No. 2016-02, “Leases,”~~Federal Deposit Insurance Corporation (FDIC). At times, cash balances may exceed the maximum coverage provided by the FDIC on insured depositor accounts. The Company believes it mitigates its risk by depositing its cash and cash equivalents with major financial institutions. On September 30, 2022 and June 30, 2022, the Company had $243,598 and $811,429 in excess of FDIC insurance, respectively.

NOTE 5 – OPERATING LEASE RIGHT-OF-USE ASSET AND OPERATING LEASE LIABILITY

The Company leases 2,911 square feet of office space located in the Research Park at Florida Atlantic University, Innovation Centre 1, 3998 FAU Boulevard, Suite 309, Boca Raton, Florida. The Company entered into a lease agreement commencing on November 1, 2019 through January 1, 2025 in which ~~requires lessees~~the first three months of rent were abated. Due to ~~recognize~~the COVID-19 pandemic, the company decided to have all employees work from home and intends to build out the office space by the end of 2022 to allow employees to work from the office in January of 2023. The following table illustrates the base rent amounts over the term of the lease:

Base Rent Periods

November 1, 2019 to October 31, 2020	$	4,367
November 1, 2020 to October 31, 2021	$	4,498
November 1, 2021 to October 31, 2022	$	4,633
November 1, 2022 to October 31, 2023	$	4,772
November 1, 2023 to October 31, 2024	$	4,915
November 1, 2024 to January 31, 2025	$	5,063

Operating lease right-of-use ~~assets~~asset and ~~lease liabilities, for all leases, with the exception of short-term leases,~~liability are recognized at the ~~commencement date~~present value of ~~each lease. This ASU requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on~~ the ~~principle of whether or not~~future lease payments at the lease commencement date. The interest rate used to determine the present value is ~~effectively a financed purchase by~~our incremental borrowing rate, estimated to be 10%, as the ~~lessee. This classification will determine whether~~interest rate implicit in most of our leases is not readily determinable. Operating lease expense is recognized ~~based on an effective interest method or~~ on a straight-line basis over the ~~term~~lease term. Since the common area maintenance expenses are expenses that do not depend on an index or rate, they are excluded from the measurement of the ~~lease. This ASU is effective for annual periods beginning after December 15, 2018~~lease liability and ~~interim periods within those annual periods. Early adoption is permitted. The amendments of this update should be applied using a modified retrospective approach, which requires lessees~~recognized in other general and ~~lessors to recognize and measure leases at the beginning of the earliest period presented. The adoption of this guidance is not expected to have a material impact~~administrative expenses on the ~~Company’s results~~statements of ~~operations, financial position or disclosures.~~

~~In March 2016,~~operations. At inception the FASB issued ASU 2016-09, “Improvements to Employee Share-Based Payment Accounting.” The guidance simplifies accounting for share-based payments, most notably by requiring all excess tax benefits and tax deficiencies to be recorded as income tax benefits or expenseCompany paid prepaid rent in the income statement and by allowing entities to recognize forfeitures of awards when they occur. This new guidance is effective for annual reporting periods beginning after December 15, 2016 and may be adopted prospectively or retroactively. The Company is currently evaluating the impact the adoption of this standard would have on its financial condition, results of operations and cash flows.

In May 2016, the FASB issued ASU 2016-12, “Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients” (“ASU 2016-12”), which amends the guidance in the new revenue standard on collectability, noncash consideration, presentation of sales tax, and transition. The amendments are intended to address implementation issues and provide additional practical expedients to reduce the cost and complexity of applying the new revenue standard. The new guidance is effective for annual periods beginning after December 15, 2017, including interim periods within those annual periods, which will be our interim period beginning January 1, 2018. Early adoption is permitted only as of annual reporting periods beginning after December 15, 2016, including interim reporting periods with that reporting period. The Company is currently evaluating the impact of adopting this standard on its consolidated financial statements.

In August 2016, the FASB issued ASU 2016-15, regarding ASC Topic 230 “Statement of Cash Flows.” This update addresses eight specific cash flow issues with the objective of reducing the existing diversity in practice. The new guidance is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. Early adoption is permitted. The Company does not expect the adoption of this standard to have a significant effect on its consolidated financial statements.

There were no other new accounting pronouncements during the three-month period ended September 30, 2015 that we believe would have a material impact on our financial position or results of operations.

~~Reclassification~~

~~Certain prior year amounts have been reclassified for consistency with the current period presentation. These reclassifications had no effect on the reported results of operations or cash flow.~~

~~Note 3 – TRADE RECEIVABLES~~

Trade receivables consist principally of accounts receivable from sales to small to medium sized businesses, principally in Australia, Europe and the United States. Trade receivables are recorded at the invoiced amount and net of allowances for doubtful accounts. The allowance for doubtful accounts represents management's estimate of the amount of probable credit losses in existing accounts receivable, as determined from a review of past due balances and other specific account data. The assessment includes actually incurred historical data as well as current economic conditions. Account balances are written off$4,659, which was netted against the ~~allowance when management determines the receivable is uncollectible.~~operating lease right-of-use asset balance until it was applied in February 2020.

~~Collectability of trade receivables~~Right-of-use asset is reviewed on an ongoing basis. Debts which are known to be uncollectable are written off by reducing the carrying amount directly. A provision for impairment of trade receivables is raised when there is objective evidence that the consolidated entity or parent entity will not be able to collect all amounts due according to the original terms of the receivables. Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial reorganization and default or delinquency in payments (more than 60 days overdue) are considered indicators that the trade receivable may be impaired. The amount of the impairment allowance is the difference between the asset's carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate. Cash flows relating to short-term receivables are not discounted if the effect of discounting is immaterial.summarized below:

	September 30, 2022
Office lease	$	220,448
Less: accumulated amortization		(103,011	)
Right -of- use asset, net	$	117,437

Trade receivables that are past their normal payment terms are overdue and once 60 days past due are considered delinquent. Minimum payment terms vary by product. The maximum payment term for all products

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Operating lease liability is ~~90 days. All trade receivables that are overdue are individually assessed for impairment.~~summarized below:

	September 30, 2022
Office lease	$	129,667
Less: current portion		(50,647	)
Long term portion		79,020

Maturity of the lease liability is as follows:
Fiscal year ending June 30, 2023		45,589
Fiscal year ending June 30, 2024		62,201
Fiscal year ending June 30, 2025		37,112
		144,901
Present value discount		(15,235	)
Lease liability	$	129,667

NOTE 6 – CONVERTIBLE NOTES PAYABLE

The ~~allowances for doubtful accounts~~carrying value of convertible notes payable, net of discount, as of September 30, 2022 and June 30, 2022 was $5,590,000 and $3,936,185, respectively.

	September 30,		June 30,
Convertible Notes Payable	2022		2022
Convertible notes payable issued October 27, 2021 (0% interest) – Auctus Fund LLC	$	5,950,000	$	6,050,000
Total face value		5,950,000		6,050,000
Less unamortized discount		-		(2,113,815	)
Carrying value	$	5,950,000	$	3,936,185

Between September 27, 2019 and August 10, 2021, the Company issued convertible notes payable with an aggregate face value of $892,300, of which $342,950 were issued by our subsidiary AAT. The notes have a coupon rate of 6% and maturity dates between three and six months. The agreements provided the holder has the option to convert the principal balance and any accrued interest to common stock of the Company. In the event the holder does not elect to convert the note prior to maturity, the note will automatically convert to common stock. Of the $892,300, $342,950 is convertible at $.0033 per share, $87,000 is convertible at $0.025 per share, $180,550 is convertible at $.03 per share, $31,800 is convertible at $0.003 per share, and the remaining $250,000 is convertible at $.06 per share. All these convertible notes payable have been converted as of December 31, ~~2016 and June~~2021. During the three months ended September 30, ~~2016 are $139,098 and $147,870 respectively.~~

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~~Note 4 – INTANGIBLE ASSETS~~

~~Intangible assets consist~~2021, the Company recorded amortization of ~~the following as of December 31, 2016 and June 30, 2016:~~

December 31

June 30

2016

2016

Website

$ 60,781

$ 60,781

Accumulated amortization

$ (25,883 )

$ (22,512 )

$ 34,898

$ 38,269

~~The intangible assets are amortized over 1~~debt discount related to 10 years. Amortization expense was $3,371 and $3,371 for the six-month periods ended December 31, 2016 and 2015 respectively Amortization expense was $1,685 and $1,685 for the three-month periods ended December 31, 2016 and 2015 respectively.

~~Note 5 – TRADE AND OTHER PAYABLES~~

~~As of December 31, 2016 and June 30, 2016, trade and other payable are comprised of the following:~~

December 31

June 30

2016

2016

Trade payable

$ 592,826

$ 593,009

Officer compensation

$ 94,986

$ 83,739

Payroll payable

$ 73,210

$ 29,616

Payroll taxes

$ 158,518

$ 158,518

Employee benefits

$ 91,201

$ 88,097

Other liabilities

$ 65,983

$ 55,793

$ 1,076,724

$ 1,008,772

~~Note 6 – TRADE FINANCING~~

The Company has a trade financing agreement with a financial institution in Australia with a maximum limit of AUD $150,000 at an interest rate of 20.95% per annum. The Company reached a settlement with its obligation with the entitythese notes in the amount of ~~AUD $165,523. The amount is to be paid through application~~$149,028 and interest expense of its EMDG grant and up to 25% of the Company's store sales in Australia. All of the amounts referenced are in Australian dollars. As of December 31, 2016 and June 30, 2016, the Company had outstanding balances of USD $65,923 and $72,936, respectively.$2,389.

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Auctus Fund, LLC Senior Secured Note

On ~~August 14, 2014~~October 27, 2021, the Company ~~entered into~~issued a ~~trade finance agreement~~convertible note payable with ~~an entity in~~Auctus Fund, LLC (the “Auctus Note”) with the ~~United States with a total maximum facility~~principal sum of ~~$1,500,000 based on $1,000,000 towards sales invoiced and $500,000 towards purchase order financing. As of December 31, 2016 and June 30, 2016,~~$6,050,000, which amount is the ~~Company had an outstanding balance of $135,992 and $176,783, respectively.~~

~~On November 2, 2016, the Company entered into a merchant agreement with a capital funding group for a purchase price of $35,000 and purchased~~$5,142,500 actual amount of ~~$47,250. The Company is amortizing the excess of purchase amount over~~ the purchase price, over the term of the financing of 21 months. Pursuant to the agreement, the Company cannot obtain future financing by selling receivables without consent from the lender. The Merchant holds a security interest in all accounts and proceeds. During the six-month period ended December 31, 2016, the Company amortized interest of $1,167.

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On November 3, 2016, the Company entered into a payments rights purchase and sale agreement for $72,500. The financing has a purchase price of $50,000 with the purchased amount of $72,500. The Company is amortizing the excess of purchased amount over purchase price, over the term of the financing of six months. The Company has to make daily payments of $575.40 to the lender. During the six-month period ended December 31, 2016, the Company amortized $7,500 of the excess purchased amount, as interest expense, in the accompanying financials.

On November 29, 2016, the Company entered into a consignment agreement. It is a platform for funding advance inventory production. This facility allowed the Company to fund manufacturing with a consignment facility which pegs repayment to the sales of inventory. During the period ended December 31, 2016, the Company raised $114,888 for a purchase price of $133,341.51. The difference of $15,508.71 is being amortized over the period of financing of seven months. During the three-month period ended December 31, 2016, the Company recordedhereof plus an ~~interest expense of $2,216.~~

~~Note 7 –LOANS~~

~~In December 2013, the company entered into a short-term loan arrangement~~original issue discount in the amount of ~~$100,000 with an individual. Terms of the note require~~$907,500 and to pay interest ~~payment of $5,000~~ on the ~~repayment date, 30 days after the note date. If not repaid at that time, interest will accrue~~unpaid principal amount hereof at the rate of ~~$166~~zero percent per ~~day~~annum from the issue date until the note is repaid. The outstanding balance as of December 31, 2016 and as of June 30, 2016 was $100,000 and $100,000 respectively. During the six-month periods ended December 31, 2016 and 2015, the Company recorded an interest of $30,212 and $30,046, respectively, on the note. During the three-month periods ended December 31, 2016 and 2015, the Company recorded an interest of $15,106 and $14,940, respectively, on the note.

~~From May 2014 to December 2016, the Company entered into several convertible loan agreements with a lender aggregating in the amount of $162,500. The notes bear interest at 6% per annum and are~~becomes due and payable, ~~six months from~~and $433,550 for professional fees in completing the date of each note. The loans may be converted into common stock at any time by the election of the lender after a period of six months at 20% discount to the market price. However, the notes have a floor to the conversion price of $0.05 per share for the old notes and a floor of $0.03 per share for the new notes. As of December 31, 2016, the Company had no beneficial conversion feature to be recorded on the notes. The outstanding balance as of December 31, 2016 and as of June 30, 2016 was $162,500 and $131,500 respectively. The Company accrued interest of $4,875 and $3,945 during the three-month periods ended December 31, 2016 and 2015, respectively. The Company accrued interest of $2,566 and $2,122 during the three-month periods ended December 31, 2016 and 2015, respectively.

In June 2015, the Company entered into a secured promissory note in the amount of $500,000 with a Delaware statutory trust. The note bears interest at the rate of 18% per annum and was due or before July 1, 2017.transactions. The note has various covenants attached including one in which all credit card receipts are to be swept into an account which will fund payments on the note that are not in excess of the minimum quarterly payments required. As a condition of the note, an affiliate of the lender was granted a warrant to purchase 6,000,000 shares of the common stock of the Company at a price of $.08 in whole or in part. The outstanding balance as of June 30, 2016 was $500,000.

~~On February 5, 2016, The Company signed an amendment to the secured promissory note extending the~~ maturity date ~~by one year~~of twelve months. The agreement provides the holder has the option to July 17, 2018. The amendment changed the terms of the credit card receipts used to fund payments required by the note. The amendment also cancelled the warrants to purchase 6,000,000 shares at a price of $0.08. New warrants were granted to purchase 6,000,000 shares at $0.05 per share and to purchase 2,000,000 shares at $0.02 per share. The Company determined the fair value of the warrants using the Black – Scholes model and recorded the additional value of $41,467 for the modified warrants. The variables used for the Black –Scholes model are as listed below:

·
~~Volatility: 123%~~
·
~~Risk free rate of return: 1.26%~~
·
~~Expected term: 5 years~~

In connection with the issuance of the above notes, the Company recorded a note discount of $115,274. The Company amortized $25,068 and $28,470, of the note discount during the six-month periods ended December 31, 2016 and 2015, respectively. The Company amortized $12,534 and $14,235, of the note discount during the three-month periods ended December 31, 2016 and 2015, respectively. The Company recorded an interest of $45,000 and $36,721, on the note during the six-month periods ended December 31, 2016 and 2015, respectively. The Company recorded an interest of $22,500 and $14,722, on the note during the three-month periods ended December 31, 2016 and 2015, respectively.

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~~Related Party Payable~~

The Company has a convertible note agreement with a shareholder for $526,272. The Convertible Note bears interest at the rate of 18% per annum and is due on or before April 30, 2017. The interest portion of the note shall be paid weekly starting in April 2015. All or any portion ofconvert the principal ~~amount of the Convertible Note~~balance and ~~all~~any accrued interest ~~is convertible at the option of the holder into~~to common stock of the Company at a conversion price of ~~five cents ($0.05)~~lesser of (i) $0.1187 or (ii) 75% of the offering price per share ~~subject~~divided by the number of shares of common stock. The Auctus Note is secured by the grant of a first priority security interest in the assets of the Company.

In connection with the notes, the Company issued warrants indexed to ~~various standard provisions.~~an aggregate 50,968,828 shares of common stock. The ~~outstanding balance as~~warrants have a term of ~~December 31, 2016~~five years and ~~June 30, 2016, net~~an exercise price of ~~related discount, was USD $377,724 and $370,008, respectively.~~$0.1187. The warrants were recorded at fair value of $2,777,081 to additional-paid-in-capital in accordance with ASC 815-10 based upon the allocation of the debt proceeds. The Company ~~determined~~estimated the fair value of the ~~convertible note~~warrants using a Black-Scholes option-pricing model, which is based, in part, upon subjective assumptions including but not limited to stock price volatility, the expected life of ~~$80,909 using~~the warrants, the risk-free interest rate and the fair value of the common stock underlying the warrants. The Company estimates the volatility of its stock based on the average of three similar size public companies peer group historical volatility that is in line with the expected remaining life of the warrants. The risk-free interest rate is based on the U.S. Treasury zero-coupon bond for a maturity similar to the expected remaining life of the warrants. The expected remaining life of the warrants is assumed to be equivalent to their remaining contractual term.

The Company was required to determine if the debt contained a beneficial conversion feature (“BCF”), which is based on the intrinsic value ~~method.~~on the date of issuance. The Company recorded ~~an amortization~~$2,365,419 conversion feature in additional paid-in capital. The BCF resulted in a debt discount and are amortized over the life of the ~~debt discount~~note.

Effective July 26, 2022, the Company entered into an Amendment to Senior Secured Promissory Note (the “Amendment”) with Auctus Fund, LLC (“Auctus”) pursuant to which the parties agreed to amend the Company’s Senior Secured Convertible Promissory Note in the principal amount of ~~$7,717~~$6,050,000 dated October 27, 2021 (the “Note”) issued to Auctus. The Amendment (i) extended the maturity date of the Note to November 1, 2022 and ~~$7,717, during~~(ii) extended the ~~six-month period ended December 31, 2016~~dates for the completion of the acquisition of XTI Aircraft and ~~2015, respectively.~~the uplist of the Company’s common stock to a national securities exchange to November 1, 2022. In consideration of the Amendment, the Company agreed to (i) grant to Auctus a new Warrant to purchase 25,000,000 shares of Common Stock dated July 26, 2022 (the “Warrant”) at an exercise price of $0.09 per share; (ii) make a prepayment of the Note in the amount of $100,000; and (iii) cause a director of the Company to cancel his 10b-5(1) Plan. The Company ~~recorded~~tested the modification under ASC 470-50-40 to determine if the modification resulted in an ~~amortization~~extinguishment. It was determined the present value of the cash flows under the terms of the new debt ~~discount~~instrument was at least 10 percent different from the present value of ~~$3,858 and $3,858, during~~ the ~~three-month period~~remaining cash flows under the terms of the original instrument. As a result, the modification resulted in a loss on an extinguishment in the amount of $3,570,366. The loss on extinguishment was determined as follows:

Reacquisition Price:
Modified convertible debt instrument			5,950,000.00
Fair value of warrants			1,918,393
Cash payment			100,000
Carrying Value of Original Instrument
Original convertible debt instrument	6,050,000
Debt discount - warrant	(707,585	)
Original issue discount	(341,692	)
Debt discount - BCF	(602,696	)
Carrying value of original debt			4,398,027
Loss on extinguishment			3,570,366

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For the three months ended ~~December 31, 2016 and 2015, respectively. During the six-month periods ended December 31, 2016 and 2015,~~September 30, 2022, the Company recorded ~~an interest~~$461,482 in amortization of ~~$42,606~~debt discount related to the Auctus note. As of September 30, 2022 and ~~$34,227, respectively, on~~June 30, 2022, the ~~note.~~ carrying value of the Auctus note was $5,950,000 and $3,936,185, respectively.

NOTE 7– RELATED PARTY TRANSACTIONS

Consulting fees

During the ~~three-month periods~~three months ended ~~December 31, 2016~~September 30, 2022 and ~~2015,~~2021, the Company recorded $55,000 and $33,000 respectively, in consulting fees to Ancient Investments, LLC, a Company owned by the Company’s CEO, Keith Duffy and the Company’s Executive Director of Corporate Operations, Scott Duffy. As of September 30, 2022, and June 30, 2022, $15,000 and $22,000 was recorded in accrued liabilities.

For the three months ended September 30, 2022 and 2021, the Company recorded $20,000 and $24,000 respectively, in consulting fees to Edward DeFeudis, a Director of the Company. As of September 30, 2022, and June 30, 2022, $10,000 and $0 was recorded in accrued liabilities.

During the three months ended September 30, 2022 and 2021, the Company recorded $14,000 and $18,000 respectively, in consulting fees to AMP Web Services, a Company owned by the Company’s CTO, Pablo Lavigna. As of September 30, 2022 and June 30, 2022, $7,000 and $7,000 was recorded in accrued liabilities.

During the three months ended September 30, 2022 and 2021, the Company recorded $5,000 and $7,500 respectively, in consulting fees to Keystone Business Development Partners, a Company owned by the Company’s CFO, Brian Carey.

NOTE 8 – COMMITMENTS AND CONTINGENCIES

During the normal course of business, the Company may be exposed to litigation. When the Company becomes aware of potential litigation, it evaluates the merits of the case in accordance with FASB ASC 450-20-50, Contingencies. The Company evaluates its exposure to the matter, possible legal or settlement strategies and the likelihood of an ~~interest~~unfavorable outcome. If the Company determines that an unfavorable outcome is probable and can be reasonably estimated, it establishes the necessary accruals.

Joint Venture

In connection with the Eco-Aero, LLC Joint Venture, discussed in Note 3, the Company has the right to invest up to $10,000,000 into the joint venture.

Financial Advisory Agreements

On August 10, 2021, the Company entered into an Advisory Agreement with an outside firm to assist the Company with fundraising activities. In connection with the agreement, the Company has the following commitments:

	·	to issue 500,000 shares payable at the date of the agreement, 500,000 shares payable three months from the date of the agreement, 500,000 shares payable nine months from the date of the agreement.

	·	Pay a financing fee of 1.5% of gross proceeds received by the Company up to $100,000,000; a financing fee of 1.25% of gross proceeds received by the Company from $100,000,000-$200,000,000, and a financing fee of 1% of gross proceeds received by the Company over $200,000,000

	·	M&A fee of 1.5% of the value of a business or asset sold up to $50,000,000; an M&A fee of 1.25% of value of a business or asset sold from $50,000,000-$100,000,000, an M&A fee of 1% of value of a business or asset sold from $100,000,000-$200,000,000, and an M&A fee of 0.5% of value of a business or asset sold over $200,000,000

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During the year ended June 30, 2022, the Company issued all 1,500,000 shares under the agreement.

On August 19, 2021, the Company entered into an Advisory Agreement with an outside firm to assist the Company with fundraising activities. In connection with the agreement, the Company has the following commitments:

	·	Issue 2,225,000 common shares payable at the date of the agreement, and 2,225,000 common shares payable upon an uplisting of the Company’s common stock to a national exchange.

	·	Pay a cash fee of seven percent 7% of the amount of capital raised, invested or committed; and deliver a warrant (the “Agent Warrant”) to purchase shares of the Common Stock equal to seven percent (7%) of the number of shares of Common Stock underlying the securities issued in the Financing.

	·	Pay a cash fee for entering into a transaction including, without limitation, a merger, acquisition or sale of stock or assets equal to one- and one-half percent (1.5%), or in the event a transaction is consummated with a party that was in communication with the Company prior to the date of this contract, then the fee shall equal one half percent (0.5%).

During the year ended June 30, 2022, the Company issued the initial 2,225,000 shares.

Litigation

On September 1, 2021, Xeriant Inc. brought a cause of ~~$21,303~~action in the Southern District of Florida against a former shareholder for claims, including but not limited to, breach of contract, misrepresentation, and ~~$17,049, respectively,~~asserting claims to recoup monetary and in-kind distributions made to the shareholder by the Company. The defendant submitted an affirmative defense and counterclaim on ~~the note.~~October 29, 2021.

Board of Advisors Agreements

The Company has ~~liabilities payable~~entered into advisor agreements with various advisory board members. The agreements provide for the following:

On October 27, 2020, the Company agreed to issue 300,000 common shares immediately, 2-year cashless warrants to purchase 300,000 common shares at the current price, and $2,500 per meeting paid 50% in cash and 50% in common shares.

On January 18, 2021, the ~~amount~~Company agreed to issue 50,000 common shares, two-year cashless warrants to purchase 25,000 common shares at the current price, and $2,500 per meeting paid in cash, common shares, or a combination.

On January 22, 2021, the Company agreed to issue 50,000 common shares, two-year cashless warrants to purchase 25,000 common shares at the current price, and $2,500 per meeting paid in cash, common shares, or a combination.

On March 7, 2021 the Company paid an advisor $2,500 and issued 50,000 common shares.

On July 1, 2021, the Company agreed to issue 100,000 common shares, and $2,500 per meeting paid in cash, common shares, or a combination, an additional bonus of ~~$181,737~~$25,000 paid in common shares issued at the end of each year of service, an option to purchase 5,000,000 common shares at $0.12 per share, vesting quarterly over 24 months, and ~~$183,269 to shareholders and officers~~for each of the following three years (beginning July 1, 2022), an option to purchase an additional 1,000,000 common shares per year thereafter at a 25% discount to the average market price for the preceding 10 trading days.

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On July 6, 2021, provided an option to purchase 5,000,000 common shares at $0.12 per share, vesting quarterly over 24 months, a bonus of 250,000 common shares issued upon a strategic partnership with a major airline, $2,500 per formal meeting paid in common shares, and an additional bonus of $25,000 paid in common shares issued at the end of each year of service.

On July 28, 2021, the Company asagreed to issue 250,000 common shares immediately, an option to purchase 5,000,000 common shares at $0.12 per share, vesting quarterly over 24 months, a bonus of ~~December 31, 2016~~5,000,000 common shares for bringing in a strategic partner that significantly strengthens the Company’s market position, $2,500 per formal meeting paid in cash, common shares or a combination, and an additional bonus of $25,000 paid in common shares issued at the end of each year of service

On August 9, 2021, the Company agreed to issue 50,000 common shares, $2,500 per meeting paid in cash, common shares, or a combination, and an additional bonus of $25,000 paid in common shares issued at the end of each year of service.

On August 20, 2021, the Company agreed to issue 100,000 common shares, and $2,500 per meeting paid in cash, common shares, or a combination, an additional bonus of $25,000 paid in common shares issued at the end of each year of service, an option to purchase 4,000,000 common shares at $0.12 per share, vesting quarterly over 24 months.

On January 20, 2022, the Company agreed to issue 250,000 common shares, and $5,000 paid on a monthly basis, for a period of three months, and an option to purchase 2,250,000 common shares at $0.12 per share, vesting immediately.

On March 28, 2022, the Company agreed to issue 150,000 common shares vested monthly over one year, and $2,500 per meeting paid in cash, and additional bonus of $25,000 paid in common shares issued at the end of each year of service.

NOTE 9 – EQUITY

Common Stock

As of September 30, 2022 and June 30, ~~2016, respectively. The note bears interest at~~2022, the ~~rate~~Company had 5,000,000,000 shares of ~~3% per annum~~common stock authorized with a par value of $0.00001. There were 365,696,144 and ~~was due on or before~~364,239,001 shares issued and outstanding as of September 30, 2022 and June 30, 2014. The outstanding balance, including accrued interest, may be converted into common shares of Banjo & Matilda, Inc. at a pre-determined rate. The Company has granted the Lenders a security interest in the intellectual property of the Borrower.

~~Scheduled principal payments on loans are as follow;~~

Year ending December 31,

Loan 1

Loan 2

Loan 3

Loan 4

Loan 5

Total

2017

$ 100,000

$ 162,500

$ 340,619

$ 387,328

$ 181,737

$ 1,172,184

2018

$ -

$ -

$ 159,381

$ -

$ -

$ 159,381

$ 100,000

$ 162,500

$ 500,000

$ 387,328

$ 181,737

$ 1,331,565

~~Note 8 – COMMITMENTS~~

The Company leases commercial space in Sydney, Australia that serves as its flagship as well as a retail store. We lease approximately 2,500 square feet of space pursuant to a three-year lease agreement which expired in October 2014. After expiration, the lease converted to a month-to-month basis. The annual rent for the premises is AUD $57,200.

~~The Company also leases space on an as needed basis in Santa Monica, California that serves as its corporate headquarters.~~

For the six-month periods ended December 31, 2016 and 2015 the aggregate rental expense was $26,058 and $36,715, respectively. For the three-month periods ended December 31, 2016 and 2015 the aggregate rental expense was $11,461 and $23,350,2022, respectively.

~~Note 9 – INCOME TAXES~~

Based on the available information and other factors, management believes it is more likely than not that the net deferred tax assets at, December 31, 2016 and June 30, 2016 will not be fully realizable. Accordingly, management has recorded a full valuation allowance against its net deferred tax assets at, December 31, 2016 and June 30, 2016. At December 31, 2016 and June 30, 2016, the Company had federal net operating loss carry-forwards of approximately $3,934,000 and $3,664,000, respectively, expiring beginning in 2032.

~~Deferred tax assets consist of the following components:~~

December 31,

June 30,

2016

2016

Net loss carryforward

$ 1,176,000

$ 1,095,000

Valuation allowance

$ (1,176,000 )

$ (1,095,000 )
Total deferred tax assets

$ -

$ -

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~~Note 10 – STOCKHOLDERS' EQUITY~~

~~Common Stock~~Fiscal Year 2022 Issuances

During the year ended June 30, ~~2015,~~2022 in connection with one of the subscription agreements, the Company ~~agreed to issue 55,200~~issued 250,000 shares ~~of the Company stock for $13,800 or $0.25 per share to~~as an ~~individual investor.~~equity kicker valued at $43,753, which has been expensed as a financing costs.

During the year ended June 30, ~~2015, on October 28, 2014,~~2022, the Company ~~agreed to issue 5,833,333~~issued 4,308,600 shares of common stock as a result of warrant exercises in the ~~Company stock to the original shareholders~~aggregate proceeds of ~~Banjo & Matilda Pty Ltd related to the merger and reorganization based on the original agreement.~~$128,550.

During the year ended June 30, ~~2015,~~2022, the Company ~~agreed to issue 92,593~~issued 4,685,615 shares of common stock ~~to an individual~~ for ~~compensation from Banjo Australia. The shares were~~services, valued at ~~$15,339 or approximately $0.17 per share.~~$761,954.

During the year ended June 30, ~~2015,~~2022, the Company ~~issued 25,000~~sold 39,366,666 shares of common stock ~~to an individual in exchange~~ for ~~interest expense. The shares were valued at $5,000 or $.25 per share.~~aggregate proceeds of $2,078,500.

During the year ended June 30, ~~2015,~~2022, the Company ~~agreed to convert $92,800 of convertible debt for 3,345,537~~issued 7,138,000 shares of common stock ~~at prices from $0.02 to $0.0901 per share to a corporate investor.~~in exchange for the conversion of 7,138 shares of Series A Preferred Stock.

During the year ended June 30, ~~2015,~~2022, the Company ~~agreed to issue 400,000~~issued 10,598,544 shares of ~~the Company~~common stock for ~~$60,000 or $0.15 per share to~~the conversion of $167,550 in principal and $4,985 in accrued interest. This resulted in a ~~company for consulting services.~~loss on extinguishment of debt in the amount of $535.

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NOTE 9 – EQUITY (CONTINUED)

During the year ended June 30, ~~2015,~~2022, the Company issued ~~21,039,970~~4,229,680 shares of ~~the Company stock for $450,799 or approximately $0.02 per share to five investors.~~

~~During the fiscal year ended June 30, 2015, the Company voided 475,000 shares of the Company~~common stock for the ~~value~~conversion of ~~$95,000. The shares were originally considered converted from debt when they were in fact not converted. The debt is still outstanding.~~$250,000 principal balance of convertible notes payable and $3,749 accrued interest.

During the year ended June 30, ~~2016,~~2022, the Company issued ~~500,000~~845,936 shares of ~~the Company’s~~ common stock in exchange for ~~settlement~~the inducement to the convertible notes holders to convert at fair value of ~~an outstanding vendor balance amounting to USD $27,123.~~$134,927.

~~Note 11 – RELATED PARTY TRANSACTIONS~~Three Months Ended September 30, 2022

On July 11,2022, the Company issued 1,000,000 shares of common stock in exchange for the conversion of 1,000 shares of Series A Preferred Stock.

On July 13, 2022, the Company issued 457,143 shares to a consultant for services valued at $48,000.

Common Stock to be Issued

During the ~~six-month period~~year ended ~~December 31, 2016 and 2015,~~June 30, 2022, the Company ~~paid $0~~sold 200,000 shares of common stock for aggregate proceeds of $6,000, or $0.03 per share. As of June 30, 2022, these shares are categorized in common stock to be issued.

During the year ended June 30, 2022, the Company agreed to pay a consultant 250,000 shares in exchange to $45,950 in services. As of June 30, 2022, these shares are categorized in common stock to be issued.

Series A Preferred Stock

There are 100,000,000 shares authorized as preferred stock, of which 3,500,000 are designated as Series A Preferred Stock having a par value of $0.00001 per share. The Series A preferred stock has the following rights:

	·	Voting: The preferred shares shall be entitled to 100 votes to every one share of common stock.

	·	Dividends: The Series A Preferred Stockholders are treated the same as the Common Stock holders except at the dividend on each share of Series A Convertible Preferred Stock is equal to the amount of the dividend declared and paid on each share of Common Stock multiplied by the Conversion Rate.

	·	Conversion: Each share of Series A Preferred Stock is convertible, at the option of the holder thereof, at any time into shares of Common Stock on a 1:1,000 basis.

	·	The shares of Series A Preferred Stock are redeemable at the option of the Corporation at any time after September 30, 2022 upon not less than 30 days written notice to the holders. It is not mandatorily redeemable.

As of September 30, 2022, and ~~$14,076 as compensation~~June 30, 2022, the Company has 780,132 and 781,132 of shares of Series A Preferred Stock issued and outstanding, respectively.

On February 15, 2021, in accordance with Florida Law and conversations with counsel, the Board of Directors of the Company rescinded 990,000 Series A Preferred Shares, which represented all preferred shares issued to one of the shareholders in the Share Exchange between American Aviation Technologies, LLC and Xeriant, Inc. entered into on April 19, 2019, due to breach of contract.

During March of 2021, the remaining former members of American Aviation Technologies, LLC agreed to allow the Company to rescind an aggregate of 1,250,001 of their 1,760,000 Series A Preferred Shares issued pursuant to the ~~mother~~Share Exchange between American Aviation Technologies, LLC and Xeriant, Inc., as a result of said breach. As a result of the ~~CEO. During the six-month period ended December 31, 2016 and 2015,~~cancellation, the Company ~~accrued interest~~reduced the investment in AAT by the value of ~~$14,111 and $14,149, respectively, on a loan owed~~these preferred shares.

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On March 27, 2021, Spider Investments, LLC returned 41,000 Series A Preferred Shares to the ~~CEO~~treasury of the Company.

On July 11,2022, the Company issued 1,000,000 shares of common stock in exchange for the conversion of 1,000 shares of Series A Preferred Stock.

Series B Preferred Stock

On March 25, 2021, the Certificate of Designation for the Series B Preferred was recorded by the State of Nevada. There are 100,000,000 shares authorized as preferred stock, of which 1,000,000 are designated as Series B Preferred Stock having a par value of $0.00001 per share. The Series B preferred stock is not convertible, does not have any voting rights and no liquidation preference.

During the year ended June 30, 2021, the Company issued 1,000,000 shares of Series B Preferred Stock to the Company’s CEO as part of his employment agreement.

Stock Options

In connection with certain advisory board compensation agreements, the Company issued an aggregate 21,250,000 options at an exercise price of $0.12 per share for the year ended June 30, 2022. These options vest quarterly over twenty-four months and have a term of three years. The grant date fair value was $3,964,207. The Company recorded compensation expense in the amount of $306,170 and $1,060,324 for these options for the three months ended September 30, 2022 and 2021, respectively. As of September 30, 2022, there was $395,946 of total unrecognized compensation cost related to non-vested portion of options granted.

As of September 30, 2022, there are 21,250,000 options outstanding, of which 10,343,750 are exercisable. The weighted average remaining term is 1.86 years.

Significant inputs and results arising from the Black-Scholes process are as follows for the options:

Quoted market price on valuation date	$0.169 - $0.23
Exercise prices	$0.12
Range of expected term	1.55 Years – 2.49 Years
Range of market volatility:
Range of equivalent volatility	215.12% - 275.73	%
Range of interest rates	0.20% - 0.47	%

Warrants

As of September 30, 2022 and June 30, 2022, the Company had 55,512,161 warrants outstanding. The warrants were issued in connection with the Convertible Notes (See Note 6). The warrants have a term of two to five years and an exercise price range from $0.1187 to $0.025. The Company evaluated the warrants under ASC 815 Derivatives and Hedging (“ASC 815”) and determined that they did not require liability classification. The warrants were recorded in additional paid-in capital under their aggregate relative fair value of $2,777,081. During the year ended June 30, 2022, holders of warrants exercised warrants for 4,305,000 shares of common stock for aggregate proceeds of $128,550. As of September 30, 2022 and June 30, 2022, the weighted average remaining useful life of the warrants was 4.0.

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NOTE 10 - NON-CONTROLLING INTEREST

AAT membership unit adjustment

On May 12, 2021, on further advice of counsel and in good faith, the Company returned 3,600,000 membership units of American Aviation Technologies, LLC to a former shareholder, which was his consideration provided in the Share Exchange between American Aviation Technologies, LLC and Xeriant, Inc. As a result, this former shareholder was restored to his original shareholding position in American Aviation Technologies, LLC.

AAT Subsidiary

On May 12, 2021, the Company’s position in American Aviation Technologies, LLC was reduced to 64%, and therefore the subsidiary is now classified as majority owned.

NOTE 11 – SUBSEQUENT EVENTS

Amendment to Joint Venture Agreement with Movychem

On November 7, 2022, Xeriant and Movychem executed an Amendment to the Joint Venture Agreement dated April 2, 2022. The Amendment: (1) affirms all the provisions of the existing Joint Venture Agreement; (2) extends the due date for the $2,000,000 Capital Contribution payment to February 15, 2023, (3) requires Xeriant to pay approximately $113,000 for related to patent filings, which will be credited against the $2,000,000 Capital Contribution; and (4) requires Movychem to timely provide materials and information to Xeriant.

Auctus Fund, LLC Senior Secured Promissory Note

The Company ~~has entered into an equity line funding agreement~~is in active negotiations with ~~Spider Investments,~~Auctus Fund, LLC, to ~~sell up to $1,500,000~~extend the maturity date of ~~our common stock, subject to certain terms~~the Senior Secured Promissory Note, which became due and conditions some of which are out of our control, including the (i) filing and obtaining effectiveness of a registration statement registering the issuance of our shares of common stock under the Act topayable on November 1, 2022. At this time, there is no assurance that Company will be issued pursuant to the equity line and (ii) certain volume and other trading conditions of our common stock. The Company plans to file the registration statement within 30 days from the date hereof and to obtain effectiveness thereof as soon as practicable.successful in these efforts.

Conversion of Series A Preferred

Effective on October 24, 2022, Karolus Maximus Kapital Inc. converted 10,237 Series A Preferred shares into 10,237,000 common shares.

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Item 2.Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion ~~and analysis~~ of our ~~Company’s~~ financial condition and results of operations should be read in conjunction with ~~our~~the audited and unaudited financial statements and the ~~related~~ notes to those statements included elsewhere in this ~~report and with the financial statements and notes thereto included in the Company’s most recent Annual Report on Form 10-K.~~Report. This discussion contains forward-looking statements that involve risks and uncertainties. ~~Actual~~You should specifically consider the various risk factors identified in this Report that could cause actual results ~~and the timing of selected events could~~to differ materially from those anticipated in these forward-looking statements.

~~Results of Operations~~Forward-Looking Statements

~~The following discussion~~This Quarterly Report on Form 10-Q contains forward looking statements, including without limitation, statements related to our plans, strategies, objectives, expectations, intentions and adequacy of resources. Investors are cautioned that such forward-looking statements involve risks and uncertainties including without limitation the following: (i) our plans, strategies, objectives, expectations and intentions are subject to change at any time at our discretion; (ii) our plans and results of operations ~~constitutes management’s view~~will be affected by our ability to manage growth; and (iii) other risks and uncertainties indicated from time to time in our filings with the Securities and Exchange Commission.

In some cases, you can identify forward-looking statements by terminology such as ‘‘may,’’ ‘‘will,’’ ‘‘should,’’ ‘‘could,’’ ‘‘expects,’’ ‘‘plans,’’ ‘‘intends,’’ ‘‘anticipates,’’ ‘‘believes,’’ ‘‘estimates,’’ ‘‘predicts,’’ ‘‘potential,’’ or ‘‘continue’’ or the negative of such terms or other comparable terminology. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance, or achievements. Moreover, neither we nor any other person assumes responsibility for the accuracy and completeness of such statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the ~~factors that affected~~date hereof. We are under no duty to update any of the ~~financial and operating performance for~~forward-looking statements after the ~~six months ended December 31, 2016 and 2015.~~ date of this Report.

This ~~discussion~~section of the report should be read ~~in conjunction~~together with ~~the financial statements and notes thereto contained elsewhere in this report. The Company has a June 30 fiscal year end.~~

~~During the six-month period ended December 31, 2016 and 2015, the transactions~~Footnotes of the Company were denominated in US Dollars. All the transactions which were denominated in other currencies were converted to US$ on the date of settlement and the exchange gains and losses were recorded in the statement of operations. No change was recorded in the comprehensive income (loss).

After a strategic review of the Company’s operating performance and long term strategy in June 2015, management decided to exit from the Company’s wholesale sales channel and business in favor of pursuing a higher value and longer term growth, direct to consumer digital vertical brand business model. In September 2015, the Company began to exit from its wholesale sales channel in-line with this strategy. As a digital vertical brand (DVB), the Company can generate higher gross margins by selling directly to consumers online by not having to accommodate the retailer wholesale mark-up. This additional gross margin from eliminating lower margin wholesale sales allows the Company to improve its overall operating margins and have greater flexibility and control over its retail pricing for its products, improving the customer value proposition and brand adoption. The Company can also build a more sustainable and higher growth revenue stream, and at the same time reduce operating overheads by eliminating fixed and variable expenses associated with operating a wholesale business model, among other significant benefits associated with a digitally centric business model. In addition, DVB’s are generally considered superior in value to traditional wholesale focused brands. Typical recent private investment valuations of DVB’s have been transacted at a valuation of 3-4 x annual sales versus less than 1 x annual sales for traditional brands (1). By pursuing a DVB strategy, the Company’s sales will temporarily reduce during the remainder of 2016 and 2017 due to the elimination of low-margin wholesale sales. While there will be been a short-term reduction in sales, the Company believes the superior DVB business model will generate and sustain greater value for shareholders moving forward.

Because of the business model improvements, EBITDA improved 9% from a loss of $215,377 in the December 2016 quarter to a loss of $195,766 in the December 2016 quarter, while Gross margin improved from 29% to 70%, underscoring the value of the new vertical digital business model showing a more than a 100% improvement in Gross Margin and an improvement in profitability on just 23% of total salesaudited financials for the ~~comparative period.~~

year ended June 30, 2022. The ~~Company recorded revenue~~unaudited statements of $159,115 during the three-months ended December 31, 2016 compared to $732,063 for the same period during the prior fiscal year, and $360,042 during the six-months ended December 31, 2016 compared to $1,612,367 for the same period during the prior fiscal year, primarily because of the reduction in wholesale sales.

By eliminating low-margin wholesale sales, Gross Margins increased to 71% in the December 2016 quarter from 29% for the same period during the prior fiscal year, and increased to 60% during the six-months ended December 31, 2016 from 32% for the same period during the prior fiscal year. Gross profit decreased to $112,698operations for the three months ended ~~December 31, 2016 from $214,911~~September 30, 2022 and 2021 are compared in the ~~same period~~sections below.

Executive Summary

Xeriant, Inc. is dedicated to the acquisition, development and commercialization of transformative technologies, including eco-friendly specialty materials which can be successfully deployed and integrated across multiple industry sectors, and disruptive innovations related to the emerging aviation market called Advanced Air Mobility, which include next-generation aircraft. We seek to partner with and acquire strategic interests in visionary companies that accelerate this mission. The Company is located at the Research Park at Florida Atlantic University in Boca Raton, Florida.

JV with XTI Aircraft

On May 31, 2021, the Company entered into a Joint Venture Agreement (the “Agreement”) with XTI Aircraft Company (“XTI”), a Delaware corporation, to form a new company, called Eco-Aero, LLC (the “JV”), a Delaware limited liability company, with the purpose of completing the preliminary design of XTI’s TriFan 600, a 5-passenger plus pilot, hybrid electric, vertical takeoff, and landing (eVTOL) fixed wing aircraft. Under the Agreement, Xeriant is contributing capital, technology, and strategic business relationships, and XTI is contributing intellectual property licensing rights and know-how. XTI and the Company each own 50 percent of the JV. The JV is managed by a management committee consisting of five members, three appointed by the Company and two by XTI. The Agreement was effective on June 4, 2021, with an initial deposit of $1 million into the JV. Xeriant’s financial commitment is up to $10 million, contributed as needed based on the aircraft development timeline and budget.

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The Company analyzed the transaction under ASC 810 Consolidation, to determine if the joint venture classifies as a Variable Interest Entity (“VIE”). The Joint Venture qualifies as a VIE based on the fact the JV does not have sufficient equity to operate without financial support from Xeriant. According to ASC 810-25-38, a reporting entity shall consolidate a VIE when that reporting entity has a variable interest (or combination of variable interests) that provides the reporting entity with a controlling financial interest on the basis of the provisions in paragraphs 810-10-25-38A through 25-38J. The reporting entity that consolidates a VIE is called the primary beneficiary of that VIE. According to the JV operating agreement, the ownership interests are 50/50. However, the agreement provides for a Management Committee of five members. Three of the five members are from Xeriant. Additionally, Xeriant has the right to invest up to $10,000,000 into the JV. As such, Xeriant has substantial capital at risk. Based on these two factors, the conclusion is that Xeriant is the primary beneficiary of the VIE. Accordingly, Xeriant has consolidated the VIE.

Recent Developments

JV with Movychem

On April 2, 2022 (Amended November 7, 2022), the Company entered into a Joint Venture Agreement with Movychem s.r.o., a Slovakian limited liability company setting forth the terms for the establishment of a joint venture (the “Joint Venture”) to develop applications and commercialize a series of flame-retardant products in the ~~prior year due~~form of polymer gels, powders, liquids and pellets derived from technology developed by Movychem under the name Retacell^™. The Joint Venture is organized as a Florida limited liability company under the name Ebenberg, LLC and is owned 50% by each of the Company and Movychem.

For its capital contribution to ~~lower overall sales driven~~the Joint Venture, pursuant to a Patent and Exclusive License and Assignment Agreement (the “Patent Agreement”), Movychem is transferring to the Joint Venture all of its interest to the know-how and intellectual property relating to Retacell exclusive of all patents, and the Company is contributing the amount of $2,600,000 payable (a) $600,000 at the rate of $25,000 per month over a 24 month period and (b) $2,000,000 within five business days of a closing of a financing in which the Company receives net proceeds of at least $3,000,000 but in no event later than February 15, 2023. At such time as the Company makes its $2,000,000 payment (and assuming the Company is current with its then monthly capital contributions), pursuant to the Patent Agreement, Movychem will transfer all of its rights, title and interest to all of the patents related to Retacell for an amount equal to aggregate cash contributions of the Company to the Joint Venture plus 40% of all royalty payments received by the ~~elimination~~Joint Venture for the licensing of ~~wholesale sales in-line~~Retacell products. Pending assignment of the patents to the Joint Venture, pursuant to the Patent Agreement, Movychem has granted to the Joint Venture an exclusive worldwide license under the patents.

Concurrently with the ~~Company’s new~~execution of the Joint Venture Agreement, the Joint Venture has entered into a Services Agreement (the “Services Agreement”) with the Company pursuant to which the Company will provide to the Joint Venture technical services related to the exploitation of the Retacell intellectual property and corporate, marketing. business ~~model. Gross profit decreased to $216,295~~development, communications and administrative services as requested by the Joint Venture in exchange for 40% of all royalty payments received by the Joint Venture for the ~~six~~licensing of Retacell products.

Under the Joint Venture Agreement, the Company has agreed to grant to certain individuals affiliated with Movychem five-year warrants (the “Warrants”) to purchase an aggregate of 170,000,000 shares of the Company’s common stock at an exercise price of $0.01 per share with vesting depending on the satisfaction of various milestones as described therein.

Table of Contents

The Company analyzed the transaction under ASC 810 Consolidation, to determine if the joint venture classifies as a Variable Interest Entity (“VIE”). The Joint Venture qualifies as a VIE based on the fact the JV does not have sufficient equity to operate without financial support from both parties. According to ASC 810-25-38, a reporting entity shall consolidate a VIE when that reporting entity has a variable interest (or combination of variable interests) that provides the reporting entity with a controlling financial interest on the basis of the provisions in paragraphs 810-10-25-38A through 25-38J. The reporting entity that consolidates a VIE is called the primary beneficiary of that VIE. According to the JV operating agreement, the ownership interests are 50/50 and the agreement provides for a Management Committee of five members. Two of the five members are from Xeriant and Movychem, respectively and one is appointed by mutual agreement of the parties. Movychem is transferring to the Joint Venture all of its interest to the know-how and intellectual property relating to Retacell exclusive of all patents, and the Company is contributing cash. As such, both parties do not have substantial capital at risk. Based on these two factors, the conclusion is that no one is the primary beneficiary of the VIE. Accordingly, Xeriant has not consolidated the VIE.

As of September 30, 2022 and June 30, 2022, the Company contributed $214,014 and $115,356 to the joint venture, respectively.

Litigation

On September 1, 2021, Xeriant Inc. brought a cause of action in the Southern District of Florida against a former shareholder for claims, including but not limited to, breach of contract, misrepresentation, and asserting claims to recoup monetary and in-kind distributions made to the shareholder by the Company. The defendant submitted an affirmative defense and counterclaim on October 29, 2021.

Three months ended ~~December 31, 2016 from $523,408 in~~September 30, 2022 compared to the ~~same period in the prior year due to lower overall sales driven by the elimination of wholesale sales in-line with the Company’s new business model.~~three months ended September 30, 2021

	For the three months ended
	September 30,			September 30,
	2021			2022			$			%
Operating expenses:
Sales and marketing expense	$	6,356		$	598,595		$	(592,239	)		(99	%)
General and administrative expenses		545,569			1,201,002			(655,433	)		(55	%)
Professional fees		90,060			29,541			60,519			205	%
Related party consulting fees		94,000			82,500			11,500			14	%
Research and development expense		-			2,340,575			(2,340,488	)		(100	%)
Total operating expenses		735,985			4,252,213			(3,516,228	)		(83	%)

Loss from operations		(735,985	)		(4,252,213	)		3,516,228			(83	%)

Other income (expense):
Amortization of debt discount		(461,842	)		(149,028	)		(312,814	)		210	%
Financing fees		-			(43,750	)		43,750			(100	%)
Interest expense		-			(2,389	)		2,389			(100	%)
Loss from Ebenberg JV		(49,328	)		-			(49,328	)		100	%
Loss on extinguishment of debt		(3,570,366	)		(535	)		(3,669,831	)		685950	%
Total other income (expense)		(4,081,536	)		(195,702	)		(3,985,834	)		2037	%

Net loss	$	(4,817,521	)		(4,447,915	)		(469,606	)		11	%

Table of Contents

Sales and marketing expenses

~~Due to changing the Company’s business model~~Total sales and ~~exiting the wholesale business, related wholesale~~marketing expenses were ~~eliminated. SG&A consisting of payroll, selling, marketing~~$6,356 and ~~design, e-commerce, retail overhead expenses, administrative (including public Company costs) and occupancy were $189,137 for the~~$598,595 for the three months ended ~~December 31, 2016~~September 30, 2022 and 2021, respectively. During the three months ended September 30, 2022 the Company’s sales and marketing expenses were associated with social media marketing campaigns, events and press releases.

General and administrative expenses

Total general and administrative expenses were $545,569 and $1,201,002 for the three months ended September 30, 2022 and 2021, respectively. In the prior period, there were increased expenses due to stock issuances related to consulting fees and advisory board fees.

Professional Fees

Total professional fees were $90,060 and $29,541 for the three months ended September 30, 2022 and 2021, respectively. The increase was primarily due to legal fees.

Related Party Consulting Fees

Total related party consulting fees were $94,000 and $82,500 for the three months ended September 30, 2022 and 2021, respectively. The related party consulting fees for the three months ended consisted of (i) $45,000 to Ancient Investments, LLC, a company owned by Keith Duffy, CEO and Scott Duffy, Executive Director of Operations, (ii) $21,000 for AMP Web Services, LLC, a company owned by Pablo Lavigna, CIO, $23,000 to Edward DeFeudis, Director, and (iii) $5,000 for Keystone Business Development Partners, LLC, a company owned by Brian Carey, CFO. The consulting fees for September 30, 2021 consisted of i) $33,000 to Ancient Investments, LLC, a company owned by Keith Duffy, CEO and Scott Duffy, Executive Director of Operations, (ii) $18,000 for AMP Web Services, LLC, a company owned by Pablo Lavigna, CIO, $24,000 to Edward DeFeudis, Director, and (iii) $7,500 for Keystone Business Development Partners, LLC, a company owned by Brian Carey, CFO.

Research and Development Expenses

Total research and development expenses were $0 and $2,340,575 for the three months ended September 30, 2022 and 2021, respectively. These research and development expenses were in connection with our Eco-Aero, LLC joint venture with XTI Aircraft Company for funding the preliminary design phase in the development of an aircraft, called the TriFan 600. There were no expenses for the joint venture for the three months ended September 30, 2022 Research & Development Expenses relating to Movychem/Ebenberg JV are accounted for through Ebenberg, LLC.

Other Income (Expenses)

Total other expenses consist of amortization of debt discount related to convertible notes, interest expense related to convertible notes, and a loss on settlement of debt. Total other expenses were $4,081,536 for the three months ended September 30, 2022 compared to ~~$271,920~~$195,702 for the ~~same period during~~year ended September 30, 2021. The increase was primarily due to recording the ~~prior fiscal year,~~amortization of debt discount from the Auctus convertible note signed in October 2021 and ~~$375,892~~the loss on extinguishment of debt due to the Auctus Note modification.

Net loss

Total net loss was $4, 817,521 for the ~~six~~three months ended ~~December 31, 2016~~September 30, 2022 compared to ~~$749,645~~$4,447,915 for the ~~same period during~~three months ended September 30, 2021. The increase was primarily related to the ~~prior fiscal year~~loss on extinguishment in debt.

~~Net loss was $325,367 for the six-month period ended December 31, 2016, compared with $402,724 for the prior year period.~~

~~(1) Note: Based on data obtained from PitchBook and Crunchbase as well as Management discussions with other DVB’s~~

5
8

Table of Contents

Liquidity and Capital Resources

~~LIQUIDITY AND CAPITAL RESOURCES~~

WeAs of September 30, 2022, we had a cash balance of $498,039 and a working deficit of $5,651,721. Our net loss of $4,817,522 in the three months ended September 30, 2022 was mostly funded by proceeds raised from financings. We will need to raise working capital ~~deficit of $2,734,954 as of December 31, 2016. We will continue~~(or refinance existing short-term debt to ~~borrow~~long-term debt) to ~~acquire inventory and~~ fund sales. The rates at which we can acquire funds will directly impact our ability to operate profitably and generate positive cash flow. In addition to relying upon debt, we will seek to raise equity to support our efforts to grow. There is no assurance that debt or equity financing will be available to us on acceptable terms, if at all, and, in all events, the sale of equity or instruments convertible into equity will dilute the interests of our current shareholders.operations. Future equity financings may be dilutive to our stockholders. Alternative forms of future financings may include preferences or rights superior to our common stock. Debt financings may involve a pledge of assets and will rank senior to our common stock. We have historically financed our operations through ~~best-efforts~~best- efforts private equity and debt financings. We do not have any credit or equity facilities available with financial institutions, stockholders or ~~third party~~third-party investors, and will continue to rely on best efforts financings. The failure to raise sufficient capital ~~could~~will likely cause us to cease operations.

The Company has entered into an equity line funding agreement with Spider Investments, LLC to sell up to $1,500,000 of our common stock, subject to certain terms and conditions some of which are out of our control, including the (i) filing and obtaining effectiveness of a registration statement registering the issuance of our shares of common stock under the Act to be issued pursuant to the equity line and (ii) certain volume and other trading conditions of our common stock. The Company plans to file the registration statement within 30 days from the date hereof and to obtain effectiveness thereof as soon as practicable.

During the ~~six~~three months ended ~~December 31, 2016, net cash of $132,233 was used in~~September 30, 2022, our operating activities ~~compared with $43,983~~used $567,906 of net cash ~~used~~compared to using $2,727,742 of net cash flow in our operating activities during the ~~six~~three months ended ~~December 31, 2015. During the six months ended December 31, 2016, net cash provided~~September 30 2021. This difference primarily a decrease in stock-based compensation and stock issued for services offset by ~~financing activities was $149,742 compared with $202,066~~higher amortization of ~~net cash used in financing activities during the six months ended December 31, 2015.~~debt discount.

Funding Strategy

To date, our operations have been funded primarily through private investors. Some of these investors have verbally committed additional funding for the Company, as needed. We have had a number of discussions with broker-dealers regarding the funding required to execute the Company’s business plan, which is to acquire and develop breakthrough technologies or business interests in those companies that have developed these technologies. We are in the process of issuing an offering document to obtain the funding for certain acquisitions that are in the discussion stages. No assurance can be given that funds will be available, or, if available, will be on terms acceptable to The Company.

Off Balance Sheet Items

We do not have any off-balance sheet arrangements, financings, or other relationships with unconsolidated entities or other persons, also known as “special purpose entities” (SPEs).

Item 3. Quantitative and Qualitative Disclosures ~~about~~About Market ~~Risk~~Risk.

~~Not applicable as the Company is~~As a smaller reporting ~~company.~~company, the Company has elected not to provide the disclosure required by this item.

Item 4. Controls and ~~Procedures~~Procedures.

a) Disclosure Controls and Procedures

~~We maintain “disclosure~~Our management is responsible for maintaining disclosure controls and procedures~~” as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”),~~ that are designed to ensure that information required to be disclosed ~~by us~~ in the reports that ~~we file~~the Registrant files or ~~submit~~submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in ~~Securities and Exchange Commission~~the SEC’s rules and ~~forms,~~forms. In addition, the disclosure controls and procedures must ensure that such information is accumulated and communicated to ~~our~~the Registrant’s management, including ~~our~~its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required ~~disclosure. In designing~~financial and ~~evaluating~~other required disclosures.

At September 30, 2022, an evaluation of the effectiveness of our disclosure controls and procedures ~~management recognized that disclosure controls~~(as defined in Rules 13(a)-15(e) and ~~procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives~~15(d)-15(e) of the ~~disclosure controls and procedures are met. Additionally, in designing disclosure controls and procedures, our management~~Exchange Act) was required to apply its judgment in evaluating the cost-benefit relationship of possible disclosure controls and procedures. The design of any disclosure controls and procedures also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.

~~At the end of the period covered by this report we~~ carried out ~~an evaluation,~~ under the supervision and with the participation of Keith Duffy our Chief Executive Officer and Brian Carey our Chief Financial ~~Officer, Brendan Macpherson, of the effectiveness of the design and operation~~Officer. Based on his evaluation of our disclosure controls and procedures. This evaluation included an evaluation of our financial controls. Since our Chief Executive Officer also serves as our Chief Financial Officer and we do not have financial and accounting personnel thoroughly familiar with U.S. GAAP and U.S. securities laws and regulations, we have a deficiency in our financial controls. This deficiency in our financial controls and procedures, ~~constitutes a deficiency in~~he concluded that at September 30, 2022, our disclosure controls and procedures ~~in that our disclosure controls and procedures were~~are not effective due to ~~ensure that information required to be disclosed by us~~material weaknesses in our periodic reports is recorded, processed, summarized and reported, within the time periods specified for each report and that such information is accumulated and communicated to our management, including our principal executive and principalinternal controls over financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. This deficiency will not be considered remediated until we hire accounting personnel with the requisite knowledge and experience concerning U.S. GAAP and the U.S. securities laws.reporting discussed directly below.

b) Changes in Internal Control ~~over~~Over Financial Reporting

There ~~have~~has been no ~~changes~~change in the Company’s internal control over financial reporting, as defined in Rules 13a-15(f) of the Exchange Act, during the ~~quarterly period covered by this report~~Company’s most recent fiscal quarter ended September 30, 2022, that ~~have~~has materially affected, or ~~are~~is reasonably likely to materially affect, the Company’s internal control over financial reporting.

6
9

Table of Contents

PART II – OTHER INFORMATION

Item 1. Legal Proceedings

None.

Item 1A. Risk Factors

Our business is subject to numerous risks and uncertainties including but not limited to those discussed in “Risk Factors” in our Annual Report on Form 10-K.

Item 2. Unregistered Sales of Equity Securities

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

None.

Item 5. Other Information

None.

Table of Contents

Item 6. Exhibits

The following exhibits are filed ~~herewith:~~herewith

Exhibit
Number
Document
31.1
~~Certifications~~Certification of the principal executive officer ~~and~~pursuant to Rule 13a-14(a) or 15d-14(a) under the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2
Certification of the principal financial officer pursuant to Rule 13a-14(a) or 15d-14(a) under the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1
~~Certifications~~Certification of the principal executive ~~officer and principal financial~~ officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2
Certification of the principal financial officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS
Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document).
101.SCH
Inline XBRL Taxonomy Extension Schema Document
101.CAL
Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF
Inline XBRL Taxonomy Extension Definition Document
101.LAB
Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE
Inline XBRL Taxonomy Extension Presentation Linkbase Document
104
Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)

8
11

Table of Contents

SIGNATURES

In accordance with the requirements of the Exchange Act, the Company caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

~~BANJO & MATILDA,~~XERIANT, INC.
Date: ~~March 3, 2017~~November 21, 2022
By:
/s/ ~~Brendan Macpherson~~Keith Duffy
~~Brendan Macpherson~~Keith Duffy
Chief Executive Officer ~~and~~
(Principal Executive)

Date: November 21, 2022

By:

/s/ Brian Carey

Brian Carey

Chief Financial Officer

~~(Principal Executive and Financial Officer)~~

Nevada	27-1519178
(State or other jurisdiction of of incorporation or organization)		(I.R.S. ~~employer~~Employer ~~identification number)~~Identification No.)

Innovation Centre #1 3998 FAU Boulevard, Suite 309 Boca Raton, Florida	33431
(Address of principal executive offices)	(Zip code)

Large accelerated filer	o☐	Accelerated filer	o☐
Non-accelerated filer	o☒	Smaller reporting company	x☒
~~(Do not check if a smaller reporting company)~~Emerging growth company	☐

Condensed Consolidated Balance Sheets as of September 30, 2022 (Unaudited) and June 30, 2022		F-1

Condensed Consolidated Statements of Operations for the three months ended September 30, 2022 and ~~Comprehensive Loss~~2021 (Unaudited)		F-2

Condensed Consolidated Statements of Stockholder’s Equity for the three months ended September 30, 2022 and 2021 (Unaudited)	F-3

Condensed Consolidated Statements of Cash Flows for the three months ended September 30, 2022 and 2021 (Unaudited)		~~F-3~~F-5

Notes to Unaudited Condensed Consolidated Financial Statements		~~F-4~~F-6

	December 31,			June 30,
	2016			2016
	(Unaudited)
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	28,564		$	11,056
Trade receivables, net		-			2,870
Inventory, net		129,272			102,427
Deposit on purchases		-			1,153
Other assets		5,500			-
TOTAL CURRENT ASSETS		163,336			117,506

NON-CURRENT ASSETS
Intangible assets, net		34,898			38,269
Deferred financing costs, net		24,709			31,407
Property, plant and equipment, net		10,023			11,976
TOTAL NON-CURRENT ASSETS		69,629			81,652

TOTAL ASSETS	$	232,966		$	199,157

LIABILITIES AND STOCKHOLDERS' DEFICIT
CURRENT LIABILITIES
Trade and other payables	$	1,077,935		$	1,008,772
Deposit payable		4,621			4,621
Trade financing		196,119			249,720
Accrued interest		370,885			236,398
Loans payable		689,269			306,092
Loan from related parties		181,737			183,269
Convertible loan from related parties (net of related discount)		377,724			370,008
TOTAL CURRENT LIABILITIES		2,898,290			2,358,880

NON-CURRENT LIABILITIES
Loans payable (net of related discount) (net of current portion)		171,903			325,137

TOTAL LIABILITIES		3,070,193			2,684,017

STOCKHOLDERS' DEFICIT
Preferred stock, $0.00001 par value, 100,000,000 shares authorized
and 1,000,000 shares issued and outstanding, respectively		10			10
Common stock, $0.00001 par value, 100,000,000 shares authorized and
58,823,116 and 58,823,116 shares issued and outstanding, respectively		588			588
Additional paid in capital		1,632,517			1,632,517
Other accumulated comprehensive gain		100,007			100,007
Accumulated deficit		(4,570,349	)		(4,217,982	)
TOTAL STOCKHOLDERS' DEFICIT		(2,837,226	)		(2,484,860	)

TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT	$	232,966		$	199,157

	Three month periods ended						Six month periods ended
	December 31, 2016			December 31, 2015			December 31, 2016			December 31, 2015

Revenue	$	159,115		$	732,063		$	360,042		$	1,612,367
Cost of sales		46,417			517,152			143,747			1,088,959
Gross profit		112,698			214,911			216,295			523,408

Payroll and employee related expenses		123,879			131,688			246,362			393,653
Operating expense		20,818			42,725			40,922			105,445
Marketing expense		17,136			23,501			34,917			91,921
Samples & design expense		6,055			7,466			7,761			44,069
Occupancy expenses		11,461			23,350			26,058			36,715
Depreciation and amortization expense		2,662			2,291			5,324			4,556
Finance Charges		18,450			12,299			27,258			27,680
Corporate and public company expense		7,125			40,898			14,547			73,285
		207,587			284,219			403,150			777,324
Loss from operations		(94,889	)		(69,307	)		(186,855	)		(253,916	)

Other Income (Expense)
Interest income								-			-
Other income		3,390			(9,846	)		4,077			2,832
Amortization of debt discount		(16,393	)		(18,093	)		(32,785	)		(36,187	)
Interest expense		(68,966	)		(52,120	)		(136,804	)		(115,453	)
Total Other Expense		(81,969	)		(80,059	)		(165,512	)		(148,808	)

Loss before income tax		(176,858	)		(149,367	)		(352,367	)		(402,724	)

Provision for income taxes		-			-			-			-

Net loss		(176,858	)		(149,367	)		(352,367	)		(402,724	)

Other comprehensive income
Foreign currency translation		-			-			-			-

Comprehensive loss	$	(176,858	)	$	(149,367	)	$	(352,367	)	$	(402,724	)

Net loss per share
Basic	$	(0.00	)	$	(0.00	)	$	(0.01	)	$	(0.01	)
Diluted	$	(0.00	)	$	(0.00	)	$	(0.01	)	$	(0.01	)

Weighted average number of shares outstanding:
Basic		58,823,116			58,823,116			58,823,116			58,722,023
Diluted		58,823,116			58,823,116			58,823,116			58,722,023

	December 31, 2016			December 31, 2015

Net loss	$	(352,367	)	$	(402,724	)
Adjustments to reconcile net loss to net cash
used in operating activities:
Depreciation		1,953			1,185
Amortization		3,371			3,371
AR allowance		(8,772	)		873
Debt discount amortization		32,785			36,187
Amortization of deferred finance fee		7,851			7,851
(Increase) / decrease in assets:					-
Trade receivables		11,642			16,808
Inventory		(26,845	)		40,962
Deposit on Purchases		1,153			356,651
Other assets		(5,500	)		(235,650	)
Other receivable		-			66,952
Deferred financing costs		(1,153	)		-
Increase/ (decrease) in current liabilities:
Trade payables and other liabilities		69,162			5,202
Accrued interest		134,487			58,350
Net cash used in operating activities		(132,233	)		(43,983	)

CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property and equipment		-			(2,334	)

CASH FLOWS FROM FINANCING ACTIVITIES
Net proceeds (net payments) on related party loan		(1,532	)		268,971
Proceeds from loan payables		-			(340,886	)
Net proceeds (net payments) on loan payables		204,875			-
Net trade financing		(53,601	)		(130,151	)
Net cash provided by (used in) financing activities		149,742			(202,066	)

Net increase (decrease) in cash and cash equivalents		17,508			(248,383	)

Cash and cash equivalents at the beginning of the period	$	11,056		$	362,668

Cash and cash equivalents at the end of the period	$	28,564		$	114,285

SUPPLEMENTAL DISCLOSURES:
Cash paid during the year for:
Income tax payments	$	-		$	-
Interest payments	$	12,082		$	64,953

SUPPLEMENTAL DISCLOSURES FOR NON CASH:
FINANCING AND INVESTING ACTIVITIES
Debt converted to equity	$	-		$	27,123

	~~(1)~~	~~The balance sheet consists of the net assets of the accounting acquirer at historical cost and the net assets of the legal acquirer at fair value.~~

	~~(2)~~	~~The statements of operations include the operations of the accounting acquirer for the period presented and the operations of the legal acquirer from the date of the merger.~~

	December 31			June 30
	2016			2016
Property, plant & equipment	$	31,378		$	31,378
Accumulated depreciation	$	(21,355	)	$	(19,402	)
	$	10,023		$	11,976

	·	~~Volatility: 123%~~
	·	~~Risk free rate of return: 1.26%~~
	·	~~Expected term: 5 years~~

Year ending December 31,	Loan 1		Loan 2		Loan 3		Loan 4		Loan 5		Total
2017	$	100,000	$	162,500	$	340,619	$	387,328	$	181,737	$	1,172,184
2018	$	-	$	-	$	159,381	$	-	$	-	$	159,381
	$	100,000	$	162,500	$	500,000	$	387,328	$	181,737	$	1,331,565

Exhibit Number		Document

31.1		~~Certifications~~Certification of the principal executive officer ~~and~~pursuant to Rule 13a-14(a) or 15d-14(a) under the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2		Certification of the principal financial officer pursuant to Rule 13a-14(a) or 15d-14(a) under the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1		~~Certifications~~Certification of the principal executive ~~officer and principal financial~~ officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2		Certification of the principal financial officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS		Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document).

101.SCH		Inline XBRL Taxonomy Extension Schema Document

101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF		Inline XBRL Taxonomy Extension Definition Document

101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document

101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document

104		Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)

	~~BANJO & MATILDA,~~XERIANT, INC.


Date: ~~March 3, 2017~~November 21, 2022	By:	/s/ ~~Brendan Macpherson~~Keith Duffy
			~~Brendan Macpherson~~Keith Duffy Chief Executive Officer ~~and~~ (Principal Executive)