NOTE 4 STOCKHOLDERS’ EQUITY

On November 4, 2025, the Company entered into an equity purchase agreement (the “Streeterville Purchase Agreement”) with Streeterville Capital, LLC (“Streeterville”) for the purchase of up to $20 million of the Company’s shares of common stock. In connection with the Streeterville Purchase Agreement, Streeterville and the Company entered into a Registration Rights Agreement, pursuant to which the Company filed a registration statement for the resale of up to 80,000 shares of common stock (the “Registration Statement”), adjusted for the 2026 Reverse Stock Split.

Pursuant to the Streeterville Purchase Agreement (so long as there is no balance outstanding on the Note) (Note 9), the Company has the right, but not the obligation, to direct Streeterville, by delivery to Streeterville of a put notice from time to time during a period of up to two years, to purchase shares of common stock (i) in a minimum amount not less than $25,000, and (ii) in a maximum amount up to the median daily trading volume of the common stock during the five trading days immediately preceding delivery of the put notice, or such other greater amount mutually agreed upon by the parties; provided, however, that the number of put shares shall not exceed the beneficial ownership limitation, of 4.99% of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock issuable pursuant to a put notice.

During the six months ended September 30, 2026, the Company and Streeterville entered into various exchange agreements on the Note, pursuant to which the Company delivered 320,304 shares of common stock to Streeterville with an average fair market value of $5.47 per share over each issuance date, resulting in approximately $1.8 million recorded to additional paid-in capital.

On July 29, 2026, the Company entered into a securities purchase agreement with certain institutional investors and Robert Goodman, CEO, and Daniel Moorhead, CFO, pursuant to which the Company sold, in a private placement offering (the “Private Placement”), an aggregate of (i) 167,011 shares of common stock (ii) 1,638,835 pre-funded stock purchase warrants, (the “July 2026 Pre-Funded Warrants”), (iii) 1,805,846 Series A stock purchase warrants (the “July 2026 Series A Common Warrants”), and (iv) 1,805,846 Series B stock purchase warrants (the “July 2026 Series B Common Warrants” and, together with the July 2026 Series A Common Warrants, the “July 2026 Common Warrants”). Each share of stock and accompanying July 2026 Common Warrants were sold together at a combined offering price of $5.66 per share for the participating institutional investors and $5.76 per share for the participating directors and executive officers, and each July 2026 Pre-Funded Warrant was sold at an offering price of $5.66 per July 2026 Pre-Funded Warrant for gross proceeds of $10.2 million. The July 2026 Pre-Funded Warrants have an exercise price of $0.0001 per share, and the July 2026 Common Warrants have an exercise price of $5.51. The Private Placement closed on July 30, 2026. The Company received total net proceeds of $9.1 million after deductions for placement agent commissions and other offering costs of $0.7 million and $0.4 million, respectively. The Company concluded the July 2026 Common Warrants are equity classified.

Stock Option Plans

The Company’s Eighth Amended and Restated 2013 Beyond Air Equity Incentive Plan (the “2013 BA Plan”) allows for awards to officers, directors, employees, and consultants of stock options, restricted stock units and restricted shares of the Company’s common stock. The 2013 BA Plan has 84,000 shares authorized for issuance. As of September 30, 2026, 44,897 shares were available under the 2013 BA Plan.

BEYOND AIR, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 4 STOCKHOLDERS’ EQUITY (continued)

Restricted Stock Units

The fair value for the restricted stock unit awards was valued at the closing price of the Company’s common stock on the date of grant. Restricted stock units vest annually over five years.

A summary of the Company’s restricted stock unit awards for the six months ended September 30, 2026 is as follows:

SCHEDULE OF RESTRICTED STOCK AWARDS 

Stock-based compensation expense related to these stock issuances for the three months ended September 30, 2026 and September 30, 2025 was $0.1 million and $0.2 million, respectively.

Stock-based compensation expense related to these stock issuances for the six months ended September 30, 2026 and September 30, 2025 was $0.2 million and $0.3 million, respectively.

As of September 30, 2026, the Company had unrecognized stock-based compensation expense for the restricted stock unit awards in the 2013 BA Plan of approximately $0.2 million, which is expected to be expensed over the weighted average remaining service period of 0.5 years.

As of September 30, 2026, all vested shares had been issued.

Stock Options

The vesting terms of the options issued under the 2013 BA Plan are generally four years and expire ten years from the grant date.

A summary of the change in stock options for the six months ended September 30, 2026 is as follows:

SCHEDULE OF OPTION ACTIVITY 

As of September 30, 2026, the Company had unrecognized stock-based compensation expense for the stock options in the 2013 BA Plan of approximately $0.7 million, which is expected to be expensed over the weighted average remaining service period of 1.3 years.

For the six months ended September 30, 2026, the weighted average fair value of options granted, adjusted for the 2026 Reverse Stock Split, was $7.48 per share.

BEYOND AIR, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 4 STOCKHOLDERS’ EQUITY (continued)

The Company’s 2021 Beyond Cancer Ltd Equity Incentive Plan (the “2021 BC Plan”) allows for awards to officers, directors, employees, and consultants of stock options, restricted stock units and restricted shares of Beyond Cancer’s common shares. The vesting terms of the options issued under the 2021 BC Plan are generally four years and they expire ten years from the grant date. On November 3, 2022, the Company’s Board of Directors approved an amendment to reserve for issuance an additional 2,000,000 shares of common stock. The 2021 BC Plan has 4,000,000 shares authorized for issuance. As of September 30, 2026, 1,771,250 common shares were available under the 2021 BC Plan.

A summary of the change in stock options for Beyond Cancer for the six months ended September 30, 2026 is as follows:

SCHEDULE OF OPTION ACTIVITY FOR BEYOND CANCER 

As of September 30, 2026, the Company had unrecognized stock-based compensation expense for the stock options in the 2021 BC Plan of approximately $0.1 million, which is expected to be expensed over the weighted average remaining service period of 1.0 years.

The Company’s 2023 NeuroNOS Ltd. Equity Incentive Plan (the “2023 NNOS Plan”) allows for awards to officers, directors, employees, and consultants of stock options, restricted stock units and restricted shares of NeuroNOS Ltd.’s common stock. The vesting terms of the options issued under the 2023 NNOS Plan are generally four years and they expire ten years from the grant date. On March 31, 2025, the Company’s Board of Directors approved to reserve for issuance 1,725,000 shares of common stock. As of September 30, 2026, 466,149 shares were available under the 2023 NNOS Plan.

A summary of the change in stock options for NeuroNOS for the six months ended September 30, 2026 is as follows:

SCHEDULE OF OPTION ACTIVITY FOR NEURONOS 

As of September 30, 2026, the Company had unrecognized stock-based compensation expense for the stock options in the 2023 NNOS Plan of approximately $0.1 million, which is expected to be expensed over the weighted average remaining service period of 0.5 years.

BEYOND AIR, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 4 STOCKHOLDERS’ EQUITY (continued)

The following was utilized to calculate the fair value of options on the date of grant:

SCHEDULE OF FAIR VALUE OF OPTION 

The following summarizes the components of stock-based compensation expense which included stock options and restricted stock units for the three and six months ended September 30, 2026 and September 30, 2025 (in thousands):

SCHEDULE OF STOCK-BASED COMPENSATION EXPENSE 

Warrants

During the six months ended September 30, 2026, holders exercised 107,131 of the January 2026 Pre-Funded Warrants.

During the six months ended September 30, 2026, holders exercised 436,443 of the July 2026 Pre-Funded Warrants issued in the Private Placement described above.

A summary of the Company’s outstanding warrants as of September 30, 2026 is as follows:

SUMMARY OF OUTSTANDING WARRANTS 

BEYOND AIR, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)