Perfect Moment Ltd. 10-K

ITEM 9A. CONTROLS AND PROCEDURES Evaluation of Disclosure Controls and Procedures We maintain disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that are designed to ensure that information required to be disclosed in our reports under the Exchange Act, is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and our principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. We carried out an evaluation under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, of the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d- 15(e) under the Exchange Act) as of the period covered by this Annual Report. Based on this evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were effective as of March 31, 2024. Management’s Report on Internal Controls Over Financial Reporting This Annual Report on Form 10-K does not include a report of management’s assessment regarding internal control over financial reporting or an attestation report of our independent registered public accounting firm due to a transition period established by rules of the SEC for newly public companies. Changes in Internal Control Over Financial Reporting There were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the quarter ended March 31, 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. Inherent Limitations on the Effectiveness of Controls Management does not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent or detect all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control systems are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in a cost-effective control system, no evaluation of internal control over financial reporting can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, have been or will be detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of a simple error or mistake. Controls can also be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls. The design of any system of controls is based in part on 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. Projections of any evaluation of controls effectiveness to future periods are subject to risks. Over time, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with policies or procedures. 53 ITEM 9B. OTHER INFORMATION Insider Trading Arrangements During the three months ended March 31, 2024, none of the Company’s directors or officers (as defined in Rule 16a-1(f) under the Exchange Act) adopted or terminated a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement,” each as defined in Item 408(a) of Regulation S-K under the Exchange Act. ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS (a) Not applicable. (b) Not applicable. PART III ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE Executive Officers and Directors The following table sets forth the names, ages and positions of our current executive officers and directors: Name Age Position Executive Officers Mark Buckley 43 Chief Executive Officer and Director Jeff Clayborne 53 Chief Financial Officer Jane Gottschalk 51 Chief Creative Officer and Director Non-Executive Directors Max Gottschalk 52 Chairman of the Board of Directors Andre Keijsers 58 Director Berndt Hauptkorn 56 Director Tracy Barwin 45 Director Tim Nixdorff 39 Director Directors are elected to serve until the next annual meeting of stockholders and until their successors are elected and qualified. Directors are elected by a plurality of the votes cast at the annual meeting of stockholders and hold office until the expiration of the term for which he or she was elected and until a successor has been elected and qualified. A majority of the authorized number of directors constitutes a quorum of the board of directors for the transaction of business. The directors must be present at the meeting to constitute a quorum. However, any action required or permitted to be taken by the board of directors may be taken without a meeting if all members of the board of directors individually or collectively consent in writing to the action. Executive officers are appointed by the board of directors and serve at its pleasure. Executive Officers Mark Buckley –Chief Executive Officer and Director Mr. Buckley has served as our Chief Executive Officer and as a member of our board of directors since November 2022. Mr. Buckley also served as our acting Chief Financial Officer from November 2022 until October 2023. Since November 2022, he has also served as the Chief Financial Officer or PMUK, and since January 2023, he has also served as the Chief Financial Officer of PMA. Since August 2022, he has also been serving as a director at 3rd Rock Private Limited, a rock-climbing clothing company based in the United Kingdom. From February 2020 to October 2022, Mr. Buckley served as Chief Financial Officer of Rapha Racing Limited, a producer and retailer of cycling clothing, where he served as Finance Director from October 2016 to February 2020 prior to becoming the Chief Financial Officer. From October 2011 to October 2016, Mr. Buckley worked at Burberry Limited, the global luxury brand, where he held various roles before becoming the Director of Financial Planning Analysis in April 2015. Before that, from April 2000 to October 2011 Mr. Buckley worked at Marks and Spencer Group plc, a major British multinational retailer, including a 17-month secondment to Woolworths in South Africa. Mr. Buckley qualified as an accountant in 2004 from the Association of Chartered Certified Accountants. We believe that Mr. Buckley is qualified to serve as a member of our board of directors due to the perspective and experience he brings as our Chief Executive Officer and former acting Chief Financial Officer. 54 Jeff Clayborne – Chief Financial Officer Mr. Clayborne has served as our Chief Financial Officer since October 2023. Since July 2023, Mr. Clayborne has served as a financial advisor at Healthy Extracts Inc. From March 2022 to March 2023, Mr. Clayborne served as Chief Financial Officer of SONDORS, Inc., where he prepared the company for a Nasdaq listing; facilitated the hiring of the senior management team, brought accounting in-house, eliminated material control weaknesses, negotiated all supply chain contracts, established a human resource function, and negotiated bridge financing. From March 2023 to June 2023, Mr. Clayborne served as a financial advisor at SONDORS, Inc. Mr. Clayborne served as Chief Financial Officer and Treasurer of Verb Technology Company, Inc. (Nasdaq: VERB, VERBW) from July 2016 to January 2022, where he facilitated an uplist from the OTCQB Markets Group to Nasdaq and the acquisition and integration of Sound Concepts Inc., participated in various equity and debt financings, built out the finance and accounting teams, and implemented NetSuite. Mr. Clayborne served as Chief Financial Officer of and a consultant with Breath Life Healing Center from August 2015 to July 2016. From September 2014 to August 2015, he served as Vice President of Business Development of Incroud, Inc and from May 2012 to September 2014, Mr. Clayborne served as President of Blast Music, LLC. Prior to this, Mr. Clayborne was employed by Universal Music Group where he served as Vice President, Head of Finance & Business Development for Fontana, where he managed the financial planning and analysis of the sales and marketing division and led the business development department. He also served in senior finance positions at The Walt Disney Company, including Senior Finance Manager at Walt Disney International, where he oversaw financial planning and analysis for the organization in 37 countries. Mr. Clayborne began his career as a CPA at McGladrey & Pullen LLP (now, RSM US LLP), then at KPMG Peat Marwick (now, KPMG). He brings with him more than 25 years of experience in all aspects of strategy, finance, business development, negotiation, and accounting. Mr. Clayborne earned his Master of Business Administration from the University of Southern California, with high honors, and his Bachelor of Science in Accountancy from Northern Illinois University. Jane Gottschalk – Chief Creative Officer and Director Ms. Gottschalk has served as our Chief Creative Officer since September 2022, as a member of our board of directors since March 2021 and as a member of PMA’s board of directors since May 2012. From July 2017 to September 2022, Ms. Gottschalk served as the Creative Director of PMUK, and since September 2022, Ms. Gottschalk has served, and is serving, as the Chief Creative Officer of PMUK. From May 2012 to September 2022, she served as Creative Director of PMA, and since September 2022, she has served, and is serving, as Chief Creative Officer of PMA. Since August 2011, Ms. Gottschalk is also serving as Director of Jing Holdings Limited, a holding company that operates Jax Coco, a leading coconut water brand, and from September 2012 to May 2023 served as Director of Jax Coco UK Limited. Ms. Gottschalk holds a B.A. from University of Kent. Ms. Gottschalk is the wife of Max Gottschalk, the Chairman of our board of directors. We believe that Ms. Gottschalk is qualified to serve as a member of our board of directors due to the perspective and experience she brings as our Chief Creative Officer and her creative, innovative and entrepreneurial attributes that provide valuable insight to our board and are aligned with our unique culture. 55 Non-Executive Directors Max Gottschalk – Chairman of the Board of Directors Mr. Gottschalk has served as the Chairman of our board of directors since March 2021, a member of PMA’s board of directors since May 2012 and a member of PMUK’s board of directors since July 2017. Since April 2022, Mr. Gottschalk has been serving as Director at Nurture Brands Limited, a plant based food and beverage business. Since November 2021, Mr. Gottschalk has been serving as Director at various holding entities for investments of the Hycap Fund, an energy transition private equity fund that invests in the hydrogen ecosystem. Since August 2011, Mr. Gottschalk has also been serving as Director of Jing Holdings Limited, a holding company that operated Jax Coco, a leading coconut water brand that was acquired by Nurture Brands Limited in 2022, and from August 2019 to May 2023 served as Director of Jax Coco UK Limited. Mr. Gottschalk is also the Co-Founder of and since December 2020 has been serving as a Partner and Director at Ocean 14 Capital Ltd., a private equity fund investing in emerging companies and technology to help protect and sustain our oceans. Since September 2019, Mr. Gottschalk has been serving as Director at Aeon Investment Limited, a credit-focused investment company, based in London. Mr. Gottschalk is also the Founder of and since December 2015 has been serving as the Chief Executive Officer and Director at Vedra Partners Ltd., a multi-family office with operations in London and Switzerland. In addition, Mr. Gottschalk is the Co-Founder of and from January 2021 to April 2023 served as a Partner and Director at Hydrogen Equity Partners Ltd., an investment management firm with a focus on new hydrogen energy sources. Mr. Gottschalk also co-founded Gottex Fund Management in 1998, a global asset management company that he built and brought to market in 2007 on the Swiss stock exchange. Prior to Gottex, he ran Bear Stearns’s fixed income derivatives hedge fund sales team in New York. Mr. Gottschalk holds a B.A. in Finance from the McIntire School of Commerce at the University of Virginia. We believe that Mr. Gottschalk is qualified to serve as a member of our board of directors due to his extensive leadership and business experience as an entrepreneur and investor, as well as his service on other boards of directors. Andre Keijsers – Director Mr. Keijsers has served as a member of our board of directors since October 2023. Since May 2016, Mr. Keijsers has been serving as Director of PMA, and from July 2017 to September 2019, Mr. Keijsers served as Director of PMUK. Since October 2020, Mr. Keijsers has been serving as the Chief Executive Officer and a Director of Van Lanschot Kempen Investment Management (UK) Ltd, an investment management company and the regulated UK subsidiary of Dutch-listed Van Lanschot Kempen N.V. From January 2017 to July 2019, Mr. Keijsers was a senior partner at Vedra Partners Ltd., a multi-family office with operations in London and Switzerland. Prior to that, Mr. Keijsers served as the Chief Financial Officer of Kings Rock Global Investment Partners Ltd from April to December 2016, and the Chief Financial Officer and Director of Fansz Ltd., a social media technology company, from April to December 2015. Fansz Ltd. filed for liquidation in January 2016. From 2008 to 2015, Mr. Keijsers was a member of the Executive Committee and the Head of M&A of Gottex Fund Management, a global asset management company. From 2001 to 2007, Mr. Keijsers served as the Chief Financial Officer of Swapstream, an electronic trading platform for interest rate swaps and a subsidiary of CME Group Inc. (Nasdaq: CME). Mr. Keijsers is the founder of Arnhem Consulting Limited, through which he provides financial and corporate governance advice to companies. From February 2017 until October 2023, Arnhem Consulting Limited provided consulting services to PMA. Since August 2019, Mr. Keijsers has been serving as Director of Pinkhurst Lane Ltd. Since November 2018, Mr. Keijsers has also been serving as Director of TGR1.618 Ltd, Iris Audio Technologies Ltd, Iris Audio Engineering Ltd and Iris Clarity Ltd. From May 2016 to September 2019, Mr. Keijsers served as Director of Jing Holdings Limited, a holding company that operates Jax Coco UK Limited, a leading coconut water brand, and from May 2016 to August 2019, he served as Director of Jax Coco UK Limited. Mr. Keijsers was an Equity Sales Associate at ABN AMRO Bank N.V. from 1991 to 1994 and Associate Director of Equity Sales at UBS from 1994 to 1996. Mr. Keijsers received a doctorandus degree in Computer Science from the Radboud University, Nijmegen, Netherlands. We believe that Mr. Keijsers is qualified to serve as a member of our board of directors due to his extensive leadership, financial and corporate governance experience, his understanding of the Company’s operations, as well as his service on other boards of directors. Berndt Hauptkorn – Director Mr. Hauptkorn has served as a member of our board of directors since October 2023. Since September 2015, Mr. Hauptkorn has been serving as President Europe Region of Chanel SAS (Paris), Chanel’s European division, where he oversees all business units (e.g., fashion, fragrance and beauty, watches and jewelry), employee teams, and sales, service and experience channels across Europe, the Middle East, India and Africa. Since January 2019, Mr. Hauptkorn has been serving as Global Markets Officer of Chanel Ltd (London), where he is responsible for the cross-regional coordination of all Region Presidents at Chanel. Since September 2015, Mr. Hauptkorn has been serving as Director at various Chanel entities: (i) Chairman at Chanel Denmark ApS (Denmark), (ii) Chairman at Chanel Norway AS (Norway), (iii) Chairman at Chanel Sweden AB (Sweden), (iv) Executive Director at Chanel s.r.o. (Czech Republic), (v) Director at CHANEL s.r.o., organizačná zlozka, a branch of Chanel s.r.o. (Slovakia), (vi) Manager at Chanel Moda ve Lüks Tüketim Ürünleri Limited Sirketi (Turkey) and (vii) Director at Chanel spółka z ograniczoną odpowiedzialnością (Poland). Prior to his roles at Chanel, from June 2012 to August 2015, Mr. Hauptkorn served as Chief Executive Officer of Uniqlo Europe and as Global Officer and Senior Vice President of Uniqlo’s Fast Retailing Group. Since March 2019, Mr. Hauptkorn has been serving as a Board Member of the European Brands Association (AIM), an organization that represents manufacturers of branded consumer goods in Europe on key issues, where he represents Chanel interests. Since November 2018, Mr. Hauptkorn has also been serving as a senior advisor to the founders and directors of LUKSO Blockchain. From August 2007 to December 2009, Mr. Hauptkorn served as Group Chief Executive Officer of Labelux Group, and from November 2009 to January 2012, Mr. Hauptkorn served as Global Chief Executive Officer of Bally International. From March 1998 to July 2007, Mr. Hauptkorn held various roles, including Principal, at the Boston Consulting Group (BCG), where he provided retail, branding, media and private equity consulting services to companies. From August 1994 to August 1997, Mr. Hauptkorn served as an Account Director at AHEAD Marketing + Kommunikation, a full-service advertising and marketing agency. Mr. Hauptkorn holds a Diplom-Kaufmann (similar to an MBA) in Business Administration from Friedrich-Alexander-University of Erlangen-Nurnberg and a Dr. rer. pol. (similar to a PhD) in Business Administration, Law, Economics and Philosophy from Friedrich-Alexander-University of Erlangen-Nurnberg. We believe that Mr. Hauptkorn is qualified to serve as a member of our board of directors due to his broad and extensive experience in the fashion industry, his leadership and operational management experience, and his experience on other boards of directors. 56 Tracy Barwin – Director Ms. Barwin has served as a member of our board of directors since November 2022. Ms. Barwin has also provided consulting services to the Company as the acting Ecommerce Director, since November 2022. Since November 2022, Ms. Barwin also serves as Founder and Director of Tracy B Ltd., a professional services company. From May 2022 until November 2022, Ms. Barwin was not actively engaged in business activities. Ms. Barwin was Executive Vice President at Hunter Boot Limited from May 2017 until May 2022, overseeing their direct-to-consumer business which included retail, ecommerce, shop-in-shops and pop-up stores. Prior to becoming Executive Vice President at Hunter Boot Limited, Ms. Barwin worked at Uniqlo, a large global SPA clothing retailer, where she held the position of Director of Customer Experience, from September 2010 to April 2017. Ms. Barwin held various roles at Myla, a luxury lingerie company, and Nike, Speedo and Hilton hotels, from 2001 to 2010 across digital, ecommerce and customer experience functions. Ms. Barwin holds a B.A. Honors degree in Modern History and Politics from Manchester University and later enhanced this degree with a post graduate diploma from The Chartered Institute of Marketing. We believe that Ms. Barwin is qualified to serve as a member of our board of directors due to the perspective and experience she brings across the fashion and retail brands she has worked across, specifically her direct-to-consumer experience as well as her experience on other boards of directors. Tim Nixdorff – Director Mr. Nixdorff has served as a member of our board of directors since January 2024. Since January 2024, Mr. Nixdorff has been serving as Chief Executive Officer and a member of the board of directors of GORE Technologies AG, an investment company. Since August 2023, Mr. Nixdorff has also been serving as Chief Operating Officer of Neon Equity AG, an investment company. From August 2022 until May 2023, Mr. Nixdorff served as Chief Marketing Officer of Rag & Bone, a fashion brand. Prior to that, Mr. Nixdorff served as Chief Executive Officer of Galvan London Ltd., a luxury fashion brand, from May 2020 until July 2022; he also served as a member of the board of directors of Galvan London Ltd. from June 2020 until August 2022. From January 2018 until April 2020, Mr. Nixdorff served as Managing Director of BEJOND Germany GmbH, a marketing consulting firm. Mr. Nixdorff holds a Master of Science degree in Economics from Technical University of Dortmund and a Bachelor of Arts degree in Business Administration from University of Duiburg-Essen. We believe that Mr. Nixdorff is qualified to serve as a member of our board of directors due to the management and consulting experience he acquired as an officer of companies in the fashion, marketing and investment industries as well as his experience on other boards of directors. Involvement in Certain Legal Proceedings To the best of our knowledge, none of our directors or executive officers have, during the past ten years, been involved in any legal proceedings described in subparagraph (f) of Item 401 of Regulation S-K. Board of Directors and Corporate Governance When considering whether directors have the experience, qualifications, attributes and skills to enable the board of directors to satisfy its oversight responsibilities effectively considering our business and structure, the board of directors focuses primarily on the information discussed in each of the directors’ individual biographies as set forth above. 57 The board of directors periodically reviews relationships that directors have with our company to determine whether the directors are independent. Directors are considered “independent” as long as they do not accept any consulting, advisory or other compensatory fee (other than director fees) from us, are not an affiliated person of our company or our subsidiaries (e.g., an officer or a greater than 10% stockholder) and are independent within the meaning of applicable United States laws and regulations and the NYSE American Company Guide. In this latter regard, the board of directors uses the NYSE American Company Guide (specifically, NYSE American Company Guide Section 803(a)(2)) as a benchmark for determining which, if any, of our directors are independent, solely in order to comply with applicable SEC disclosure rules. Board Committees Our board of directors has established an audit committee, a compensation committee and a nominating and corporate governance committee, each of which will operate pursuant to its respective charter. The composition of each committee and its respective charter became effective upon the listing of our common stock on NYSE American, and copies of each charter will be posted on the corporate governance section of our website at www.perfectmoment.com . Each committee has the composition and responsibilities described below. Our board of directors may establish other committees from time to time. NYSE American permits a phase-in period of up to one year for an issuer registering securities in an initial public offering to meet the audit committee, compensation committee and nominating and corporate governance committee independence requirements. Under the initial public offering phase-in period, only one member of each committee is required to satisfy the heightened independence requirements at the time of the listing of our common stock on the NYSE American, a majority of the members of each committee must satisfy the heightened independence requirements within 90 days following the listing, and all members of each committee must satisfy the heightened independence requirements within one year from the listing. Audit Committee Andre Keijsers, Berndt Hauptkorn and Tracy Barwin serve on the audit committee, which is chaired by Andre Keijsers. Our board of directors has determined that Andre Keijsers, Berndt Hauptkorn and Tracy Barwin are “independent” for audit committee purposes as that term is defined in the rules of the SEC and the NYSE American Company Guide, and each member has sufficient knowledge in financial and auditing matters to serve on the audit committee. Our board of directors has designated Andre Keijsers as an “audit committee financial expert,” as defined under the applicable rules of the SEC. We intend to comply with the applicable independent requirements for all members of the audit committee within the time periods specified under such rules. The audit committee’s responsibilities include: ● appointing, approving the compensation of, and assessing the independence of our independent registered public accounting firm; ● pre-approving auditing and permissible non-audit services, and the terms of such services, to be provided by our independent registered public accounting firm; ● reviewing the overall audit plan with our independent registered public accounting firm and members of management responsible for preparing our financial statements; ● reviewing and discussing with management and our independent registered public accounting firm our annual and quarterly financial statements and related disclosures as well as critical accounting policies and practices used by us; ● coordinating the oversight and reviewing the adequacy of our internal control over financial reporting; 58 ● establishing policies and procedures for the receipt and retention of accounting-related complaints and concerns; ● recommending based upon the audit committee’s review and discussions with management and our independent registered public accounting firm whether our audited financial statements shall be included in our Annual Report on Form 10-K; ● monitoring the integrity of our financial statements and our compliance with legal and regulatory requirements as they relate to our financial statements and accounting matters; ● preparing the audit committee report required by SEC rules to be included in our annual proxy statement; ● reviewing all related person transactions for potential conflict of interest situations and approving all such transactions; and ● reviewing quarterly earnings releases. Compensation Committee Max Gottschalk, Andre Keijsers and Tim Nixdorff serve on the compensation committee, which is chaired by Andre Keijsers. Our board of directors has determined that Andre Keijsers and Tim Nixdorff are “independent” as defined in the NYSE American Company Guide and each member is a “non-employee director” as defined in Rule 16b-3 promulgated under the Exchange Act. We intend to comply with the applicable independent requirements for all members of the compensation committee within the time periods specified under such rules. The compensation committee’s responsibilities include: ● annually reviewing and approving corporate goals and objectives relevant to the compensation of our chief executive officer; ● evaluating the performance of our chief executive officer in light of such corporate goals and objectives and determining the compensation of our chief executive officer; ● reviewing and approving the compensation of our other executive officers; ● reviewing and establishing our overall management compensation, philosophy and policy; ● overseeing and administering our compensation and similar plans; ● evaluating and assessing potential and current compensation advisors in accordance with the independence standards identified in the NYSE American Company Guide; ● retaining and approving the compensation of any compensation advisors; ● reviewing and making recommendations to our board of directors about our policies and procedures for the grant of equity-based awards; ● evaluating and making recommendations to the board of directors about director compensation; ● preparing the compensation committee report required by SEC rules, if and when required, to be included in our annual proxy statement; and ● reviewing and approving the retention or termination of any consulting firm or outside advisor to assist in the evaluation of compensation matters. 59 Nominating and Corporate Governance Committee Max Gottschalk, Andre Keijsers, Berndt Hauptkorn and Tim Nixdorff will serve on the nominating and corporate governance committee, which will be chaired by Andre Keijsers. Our board of directors has determined that Andre Keijsers, Berndt Hauptkorn and Tim Nixdorff are “independent” as defined in the NYSE American Company Guide. We intend to comply with the applicable independent requirements for all members of the nominating and corporate governance committee within the time periods specified under such rules. The nominating and corporate governance committee’s responsibilities include: ● developing and recommending to the board of directors criteria for board and committee membership; ● establishing procedures for identifying and evaluating board of director candidates, including nominees recommended by stockholders; ● reviewing the size and composition of the board of directors to ensure that it is composed of members containing the appropriate skills and expertise to advise us; ● identifying individuals qualified to become members of the board of directors; ● recommending to the board of directors the persons to be nominated for election as directors and to each of the board’s committees; ● developing and recommending to the board of directors a code of business conduct and ethics and a set of corporate governance guidelines; and ● overseeing the evaluation of our board of directors and management. Code of Business Conduct and Ethics We have adopted a written code of business conduct and ethics that applies to our directors, officers and employees, including our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. We provide a copy of our code of ethics can be found on our website https://investors.perfectmoment.com/corporate-governance . We intend to disclose future amendments to, or waivers of, our Code, as and to the extent required by SEC regulations, at the same location on our website identified above or in public filings. Compensation Committee Interlocks and Insider Participation None of the members of our compensation committee is currently or has been within the past three years one of our officers or an employee. None of our executive officers currently serves, or has served during the last year, as a member of the board of directors or compensation committee of any entity that has one or more executive officers serving as a member of our board of directors or compensation committee. Corporate Governance Guidelines We have adopted corporate governance guidelines, that serve as a flexible framework within which our board of directors and its committees operate. These guidelines cover a number of areas including the size and composition of the board, board membership criteria and director qualifications, director responsibilities, board agenda, meetings of independent directors, committee responsibilities and assignments, board member access to management and independent advisors, director communications with third parties, director compensation, and management succession planning. A copy of our corporate governance guidelines is available on our website at https://www.investors.perfectmoment.com. 60 Conflicts of Interest We comply with applicable state law with respect to transactions (including business opportunities) involving potential conflicts. Applicable state corporate law requires that all transactions involving our company and any director or executive officer (or other entities with which they are affiliated) are subject to full disclosure and approval of the majority of the disinterested independent members of our board of directors, approval of the majority of our stockholders or the determination that the contract or transaction is intrinsically fair to us. More particularly, our policy is to have any related party transactions (i.e., transactions involving a director, an officer or an affiliate of our company) be approved solely by a majority of the disinterested independent directors serving on the board of directors. Family Relationships Max Gottschalk, the Chairman of our board of directors, and Jane Gottschalk, and our Chief Creative Officer and a member of our board of directors, are husband and wife. There are no other family relationships among any of the directors or executive officers. ITEM 11. EXECUTIVE COMPENSATION Director Compensation During the fiscal year ended March 31, 2024, we paid cash and equity-based compensation to our non-employee directors for their service on our board of directors. We have reimbursed and will continue to reimburse all of our non-employee directors for their reasonable out-of-pocket expenses incurred in attending board of directors and committee meetings. As of March 31, 2024, our non-employee directors held 158,400 outstanding option awards to purchase or to be issued our common stock. As of March 31, 2024, Jane Gottschalk, our current Chief Creative Officer and a member of our board of directors, who was a non-employee director until August 2022, held options to purchase 68,172 shares of our common stock. We granted options to purchase 30,000 shares of our common stock each (for a total of 120,000 shares of our common stock) to Andre Keijsers, Tracy Barwin, Berndt Hauptkorn and Tim Nixdorff, our four independent directors, pursuant to and upon the terms and conditions of their Independent Director Agreements with us, vesting over a period of three years from the effective date of each such Independent Director Agreement. On March 5, 2024 we granted an additional 6,000 options to purchase our common stock to Berndt Hauptkorn and Tim Nixdorf, vesting over a period of three years from the effective date of each such Independent Director Agreement. On March 5, 2024 we granted an additional 13,200 options to purchase our common stock to Andre Keijsers and Tracy Barwin, vesting over a period of three years from the effective date of each such Independent Director Agreement. We have implemented a compensation plan for our non-employee directors, such that non-employee directors will receive an annual cash retainer and/or an annual grant of stock options. Our committee chairpersons will not receive certain additional retainer fees. Our directors who are also our employees or officers will not receive any compensation specifically related to their activities as directors, other than reimbursement for expenses incurred in connection with their attendance at meetings. Compensation to our board of directors will be reviewed annually, and changes will be recommended by the compensation committee and approved by our board of directors. Board compensation will be reviewed annually, and changes will be recommended by the compensation committee and approved by our board of directors. 61 Director Compensation Table The following table discloses the cash fees, bonuses and stock awards and total compensation earned, paid or awarded to each of our non-employee directors during the fiscal year ended March 31, 2024. Columns disclosing compensation under the headings “Non-Equity Incentive Plan Compensation,” and “Change in Pension Value and Nonqualified Deferred Compensation Earnings” are not included because no compensation in these categories was awarded to, earned by or paid to our non-employee directors in the fiscal year ended March 31, 2024. The dollar amounts shown are in U.S. dollars. The amounts originally in British pounds were converted to U.S. dollars for this table using the average of the average exchange rates for each fiscal month during the applicable fiscal year. Applying this formula to the fiscal year ended March 31, 2024, £1.00 was equal to $1.2569. Name (1) Fees Earned or Paid in Cash ($) Bonus ($) Option Awards (2) ($) Total ($) Max Gottschalk 180,994 100,000 175,778 456,772 (3) Tracy Barwin 141,763 - 170,454 312,217 (4) Andre Keijsers 48,554 - 170,454 219,008 (5) Berndt Hauptkorn 25,000 - 142,045 167,045 (6) Tim Nixdorff 12,500 - 142,045 154,545 (7) (1) Mark Buckley, a Director and Chief Executive Officer and Jane Gottschalk a Director and Chief Creative Officer during the fiscal year ending March 31, 2024, are not included in this table as they were employees, and, thus, received no compensation for their services as a director. The compensation received by Mr. Buckley and Ms. Gottschalk as employees are disclosed in the section entitled “ Executive Compensation – Summary Compensation Table ” appearing elsewhere in this Annual Report. (2) For valuation assumptions on stock option awards, refer to Note 13 of our audited consolidated financial statements for the year ended March 31, 2024 of this Annual Report. The disclosed amounts reflect the fair value of the stock option awards that were granted during the fiscal year ended March 31, 2024 in accordance with FASB ASC Topic 718. (3) The amount reported for Mr. Gottschalk represents (i) consulting fees paid to him pursuant to the terms of his consulting agreement (ii) reflects incentive bonus paid for successful initial public offering plus listing on NYSE American and (iii) stock options to purchase 50,000 shares of our common stock. (4) The amount reported for Ms. Barwin represents (i) advisory fees paid to her pursuant to the terms of her consulting agreement for providing advisory services from April 2023 to October 22, 2023 plus her director fees from October 23, 2023 to March 31, 2024 (ii) stock options to purchase 42,300 shares of our common stock. (5) The amount reported for Mr. Keijsers represents (i) advisory fees paid to him pursuant to the terms of our consulting agreement with Arnhem Consulting Limited for providing advisory services from April 2023 to October 22, 2023 plus his director fees from September 15, 2023 to March 31, 2024, (ii) stock options to purchase 42,300 shares of our common stock. (6) The amount reported for Berndt Hauptkorn represents (ii) his director fees from September 15, 2023 to March 31, 2024, (ii) stock options to purchase 36,000 shares of our common stock. (7) The amount reported in this column for Tim Nixdorff represents (i) his director fees from January 1, 2024 to March 31, 2024, (ii) stock options to purchase 36,000 shares of our common stock. 62 Consulting Agreements Max Gottschalk We, through PMA, are party to a consulting agreement with Max Gottschalk, dated May 15, 2019, which continues until terminated in accordance with its terms, during which Mr. Gottschalk is entitled to receive fees for services rendered amounting to £8,000 per month from April 2021 to November 2022 and £12,000 per month since December 2022. These amounts are in lieu of any other cash payments or equity awards Mr. Gottschalk may otherwise have been entitled to receive as a member of our board of directors. Tracy Barwin We were party to a consulting agreement with Tracy Barwin, dated November 18, 2022, pursuant to which Ms. Barwin was entitled to receive £1,500 per day for services rendered with a minimum commitment of two days per month. These amounts were in lieu of any other cash payments or equity awards Ms. Barwin may otherwise have been entitled to receive as a member of our board of directors. The consulting agreement with Ms. Barwin was terminated in October 2023 and replaced by an independent director agreement, described below under “— Independent Director Compensation.” Arnhem Consulting Limited (Andre Keijsers) We, through PMA, were party to a consulting agreement with Arnhem Consulting Limited (“Arnhem”), a company controlled by Andre Keijsers, dated February 28, 2017, pursuant to which Arnhem was entitled to receive £3,200 per month for services rendered. The consulting agreement was terminated in October 2023 as a result of Mr. Keijsers becoming a director of the Company. Independent Director Compensation Andre Keijsers On September 15, 2023, we entered into an Independent Director Agreement with Andre Keijsers, pursuant to which Mr. Keijsers will receive an annual cash fee of $50,000, and an initial grant of stock options to purchase 30,000 shares of our common stock pursuant to the 2021 Plan. On March 5, 2024, we granted Mr. Keijsers an additional 13,200 stock options for services to be rendered. We will pay the annual cash compensation fee to Mr. Keijsers in monthly installments no later than the 15th of each such calendar month, commencing on October 23, 2023, pro-rated for the initial and last payments, if applicable. The options will vest annually over a four-year period starting from the agreement date, with such vesting subject to Independent Director Agreement not having been terminated at the time of vesting and the other terms and conditions of the 2021 Plan or successor plan as well as the applicable stock option agreement between us and Mr. Keijsers. The options will have an exercise price equal to the Fair Market Value (as defined in the 2021 Plan) as of the date on which the options will be granted and an exercise period of five years from the date of the Independent Director Agreement. We will also reimburse Mr. Keijsers for pre-approved reasonable business-related expenses incurred in good faith in connection with the performance of his duties for us. As also required under the Independent Director Agreement, we have separately entered into standard indemnification agreements with Mr. Keijers. Berndt Hauptkorn On September 15, 2023, we entered into an Independent Director Agreement with Berndt Hauptkorn, pursuant to which Mr. Hauptkorn will receive an annual cash fee of $50,000, and an initial grant of stock options to purchase 30,000 shares of our common stock pursuant to the 2021 Plan. On March 5, 2024, we granted Mr. Hauptkorn an additional 6,000 stock options for services to be rendered. We will pay the annual cash compensation fee to Mr. Hauptkorn in monthly installments no later than the 15th of each such calendar month, commencing on October 23, 2023, pro-rated for the initial and last payments, if applicable. The options will vest annually over a four-year period starting from the agreement date, with such vesting subject to Independent Director Agreement not having been terminated at the time of vesting and the other terms and conditions of the 2021 Plan or successor plan as well as the applicable stock option agreement between us and Mr. Hauptkorn. The options will have an exercise price equal to the Fair Market Value (as defined in the 2021 Plan) as of the date on which the options will be granted and an exercise period of five years from the date of the Independent Director Agreement. We will also reimburse Mr. Hauptkorn for pre-approved reasonable business-related expenses incurred in good faith in connection with the performance of his duties for us. As also required under the Independent Director Agreement, we have separately entered into standard indemnification agreements with Mr. Hauptkorn. 63 Tim Nixdorff On January 18, 2024, we entered into an Independent Director Agreement with Tim Nixdorff, pursuant to which Mr. Nixdorff will receive an annual cash fee of $50,000, and an initial grant of stock options to purchase 30,000 shares of our common stock pursuant to the 2021 Plan. On March 5, 2024, we granted Mr. Nixdorff an additional 6,000 stock options for services to be rendered. We will pay the annual cash compensation fee to Mr. Nixdorff in monthly installments no later than the 15th of each such calendar month, commencing on October 23, 2023, pro-rated for the initial and last payments, if applicable. The options will vest annually over a four-year period starting from the agreement date, with such vesting subject to Independent Director Agreement not having been terminated at the time of vesting and the other terms and conditions of the 2021 Plan or successor plan as well as the applicable stock option agreement between us and Mr. Nixdorff. The options will have an exercise price equal to the Fair Market Value (as defined in the 2021 Plan) as of the date on which the options will be granted and an exercise period of five years from the date of the Independent Director Agreement. We will also reimburse Mr. Nixdorff for pre-approved reasonable business-related expenses incurred in good faith in connection with the performance of his duties for us. As also required under the Independent Director Agreement, we have separately entered into standard indemnification agreements with Mr. Nixdorff. Tracy Barwin On October 23, 2023, we entered into an Independent Director Agreement with Tracy Barwin, pursuant to which Ms. Barwin will receive an annual cash fee of $50,000, and an initial grant of stock options to purchase 30,000 shares of our common stock pursuant to the 2021 Plan. On March 5, 2024, we granted Mr. Keijsers an additional 13,200 stock options for services to be rendered. We will pay the annual cash compensation fee to Ms. Barwin in monthly installments no later than the 15th of each such calendar month, commencing on October 23, 2023, pro-rated for the initial and last payments, if applicable. The options will vest annually over a four-year period starting from the agreement date, with such vesting subject to Independent Director Agreement not having been terminated at the time of vesting and the other terms and conditions of the 2021 Plan or successor plan as well as the applicable stock option agreement between us and Ms. Barwin. The options will have an exercise price equal to the Fair Market Value (as defined in the 2021 Plan) as of the date on which the options will be granted and an exercise period of five years from the date of the Independent Director Agreement. We will also reimburse Ms. Barwin for pre-approved reasonable business-related expenses incurred in good faith in connection with the performance of her duties for us. As also required under the Independent Director Agreement, we have separately entered into standard indemnification agreements with Ms. Barwin. Outstanding Equity Awards at Fiscal Year-End The following table sets forth, for each non-employee director, certain information concerning outstanding option awards as of March 31, 2024: Name Number of securities underlying unexercised options (exercisable) (#) Number of securities underlying unexercised options (unexercisable) (#) Option exercise price ($) Option expiration date Max Gottschalk - 50,000 4.10 March 4, 2029 (1) Tracy Barwin - 43,200 4.10 March 4, 2034 (1) Andre Keijsers - 43,200 4.10 March 4, 2034 (1) Berndt Hauptkorn - 36,000 4.10 March 4, 2034 (1) Tim Nixdorff - 36,000 4.10 March 4, 2034 (1) (1) 25% vesting on the first, second, third, and fourth anniversaries from director start date. 64 Executive Compensation Named Executive Officers Our named executive officers for the fiscal year ended March 31, 2024 set forth in this annual report (the “Named Executive Officers”) are Mark Buckley, Jane Gottschalk and Jeff Clayborne. Summary Compensation Table The following table summarizes the compensation of our Named Executive Officers during the fiscal year ended March 31, 2024. The dollar amounts shown are in U.S. dollars. The amounts originally in British pounds were converted to U.S. dollars for this table using the average of the average exchange rates for each fiscal month during the applicable fiscal year. Applying this formula to the fiscal year ended March 31, 2024, £1.00 was equal to $1.2569. Name and Principal Position Fiscal Year Salary ($) Bonus ($) Stock Awards ($) Option Awards ($) All Other Compensation ($) Total ($) Mark Buckley 2024 314,225 (1) 187,916 (2) 1,230,000 (3) - 2086 (4) 1,734,227 Chief Executive Officer 2023 121,511 (5) - - - 398 (4) 121,909 Jeff Clayborne (1) 2024 83,344 (6) - - 1,183,706 (7) - 1,267,050 Chief Financial Officer Jane Gottschalk 2024 251,380 (1) 187,916 (2) - 1,054,668 (8) - 1,493,964 Chief Creative Officer 2023 140,642 (5) - - - 48,220 (9) 224,022 (1) Reflects actual earnings for the fiscal year ended March 31, 2024. (2) On February 12, 2024, we paid a bonus for the successful initial public offering and listing on NYSE American. (3) On March 5, we granted Mr. Buckley a restricted stock unit totaling $1,230,000 payable in 300,000 shares of our common stock pursuant to the terms of his employment agreement. The restricted stock unit vests equally over four years on the anniversary date of his contractual start date. The price per share as reported by NYSE American on the day of issuance was $4.10 and was used to calculate fair market value. (4) The amount reported in this column for Mr. Buckley represents PMUK contributions to the United Kingdom’s National Employment Savings Trust. (5) Reflects actual earnings for the fiscal year ended March 31, 2023, which may differ from approved 2023 base salary due to start date. (6) Reflects actual earnings for the fiscal year ended March 31, 2024, which may differ from approved 2023 base salary due to start date. (7) On March 5, 2024, we granted Mr. Clayborne a stock option to purchase up to 300,000 shares of our common stock pursuant to his employment agreement at an exercise price of $4.10 per share. The option is not currently vested and will vest equally over four years from his contractual start day and will expire on March 4, 2034. (7) On March 5, 2024, we granted Ms. Gottschalk a stock option to purchase up to 300,000 shares of our common stock at an exercise price of $4.10 per share. The option is not currently vested and will vest equally over four years from July 18, 2023, and will expire on March 4, 2029. (9) The amount reported in this column for Ms. Gottschalk represents consulting fees paid to her pursuant to the terms of her consulting agreement for the five-month period from April 2022 to August 2022. Effective September 1, 2022, Ms. Gottschalk became an employee of PMUK. Employment Agreements Named Executive Officers Mark Buckley On October 21, 2022, we entered into a Contract of Employment, through PMUK, for Mr. Buckley to serve as our Chief Executive Officer and our former acting Chief Financial Officer, commencing November 7, 2022. Mr. Buckley served as acting Chief Financial Officer until October 2023. Pursuant to the terms of the agreement, Mr. Buckley is entitled to receive an annual base salary of £250,000 and is eligible to receive performance-based bonuses, and is entitled to receive, but has not yet been granted, options to purchase 300,000 shares of our common stock, vesting over a period of 4 years. The options were to be granted at $0.01, which is below fair market value, therefore, the Company issued Mr. Buckley RSUs under the same terms and conditions of the options. In connection with his employment, Mr. Buckley also serves as a member of our board of directors. 65 Either we or Mr. Buckley may terminate for any reason upon 3 months’ prior written notice. We may also, at our sole discretion, terminate the agreement at any time and with immediate effect by paying Mr. Buckley an amount equal to the base salary he would have been entitled to receive during the notice period. In addition, we may terminate the agreement without notice if there is (a) serious or persistent breach of any terms of his employment (b) gross misconduct or any conduct tending to bring himself or us into disrepute or (c) acts of dishonesty, whether relating to us, an employee, a customer or otherwise. Mr. Buckley provides that he will be subject to certain non-solicitation provisions relating to customers, suppliers and/or employees of the Company during his employment and for a 12-month period following the termination of his employment. As of March 31, 2024, Mr. Buckley held 75,000 shares of our common stock. Jane Gottschalk On September 7, 2022, we entered into a Contract of Employment, through PMUK, for Ms. Gottschalk to serve as our Chief Creative Officer commencing September 1, 2022. Pursuant to the terms, Ms. Gottschalk is entitled to receive an annual base salary of £200,000 and was eligible to receive a guaranteed bonus of £50,000 payable on the first anniversary of her employment. Ms. Gottschalk has waived her right to receive such bonus. Future bonuses are dependent upon individual and company performance. Either we or Ms. Gottschalk may terminate the Contract of Employment for any reason upon 3 months’ prior written notice. We may also, at our sole discretion, terminate the agreement at any time and with immediate effect by paying Ms. Gottschalk an amount equal to the base salary she would have been entitled to receive during the notice period. In addition, we may terminate the agreement without notice if there is (a) serious or persistent breach of any terms of his employment (b) gross misconduct or any conduct tending to bring herself or us into disrepute or (c) acts of dishonesty, whether relating to us, an employee, a customer or otherwise. Ms. Gottschalk provides that she will be subject to certain non-solicitation provisions relating to customers, suppliers and/or employees of the Company during her employment and for a 12-month period following the termination of her employment. As of March 31, 2024, Ms. Gottschalk held options to purchase 368,172 shares of our common stock. Other Executive Officers Jeff Clayborne On October 20, 2023 (the “Effective Date”), we entered into an Employment Agreement for Mr. Clayborne to serve as our Chief Financial Officer, commencing as of such date, which was amended on January 22, 2024. Pursuant to the terms, Mr. Clayborne is entitled to receive an annual base salary of $275,000 and is eligible to receive an annual bonus; provided, however, that the decision to provide any annual bonus and the amount and terms of any annual bonus will be in the sole and absolute discretion of our board of directors and the compensation committee. Mr. Clayborne is also eligible to participate in the 2021 Plan and pursuant to his employment, is entitled to receive, subject to approval by our board of directors, options to purchase 300,000 shares of our common stock on the Effective Date, vesting annually over four years in equal installments, with the first vesting on the first anniversary of the Effective Date, with an exercise price equal to the Fair Market Value (as defined in the 2021 Plan) as of the date on which the options will be granted, which stock options will expire five years from the Effective Date. 66 The agreement will continue until the second anniversary thereof, unless terminated earlier; provided that, on such second anniversary of the Effective Date and each annual anniversary thereafter, the agreement will be automatically extended, upon the same terms and conditions, for successive one-year periods, unless either party provides written notice of its intention not to extend the term of the agreement at least 30 days prior to the applicable anniversary date. Either we or Mr. Clayborne may terminate the agreement for any reason upon 30 days’ advance written notice. If Mr. Clayborne’s employment is terminated upon either party’s failure to renew the agreement, by us for Cause (as defined in the agreement) or by Mr. Clayborne without Good Reason (as defined in the agreement), Mr. Clayborne will be entitled to receive (i) any accrued but unpaid base salary and accrued but unused vacation, (ii) any earned but unpaid annual bonus with respect to any completed calendar year immediately preceding the termination date (provided that, if Mr. Clayborne’s employment is terminated by us for Cause, then any such accrued but unpaid annual bonus will be forfeited), (iii) reimbursement for unreimbursed business expenses properly incurred by Mr. Clayborne and (iv) such employee benefits (including equity compensation), if any, to which Mr. Clayborne may be entitled under our employee benefit plans as of the termination date (clauses (i) through (iii), the “Accrued Amounts”). If Mr. Clayborne’s employment is terminated by us without Cause or by Mr. Clayborne for Good Reason, Mr. Clayborne will be entitled to the Accrued Amounts and, subject to the terms and conditions of the agreement, including Mr. Clayborne’s execution of a release of claims, Mr. Clayborne will be entitled to receive continued base salary for three months plus a lump sum payment of $13,300. In addition, all stock options granted to Mr. Clayborne that are scheduled to vest at the end of the annual vesting period in which such termination occurs will immediately vest upon the termination date; all other, unvested options will be terminated upon such termination date. Mr. Clayborne’s agreement provides that he will be subject to certain non-competition provisions and non-solicitation provisions relating to customers and/or employees of the Company during his employment and for a one-year period following the termination of his employment. The agreement also includes provisions governing Company confidential information and indemnification rights. As of March 31, 2024, Mr. Clayborne held options to purchase 300,000 shares of our common stock UK National Employment Savings Trust Our subsidiary in the United Kingdom, PMUK, is required by the applicable local laws and regulations to make contributions to the United Kingdom’s National Employment Savings Trust for all eligible personnel, including Mark Buckley, our Chief Executive Officer and former acting Chief Financial Officer. During the fiscal year ended March 31, 2024 and March 31, 2023, we contributed £1,660 and £330, respectively to the National Employment Savings Trust for Mr. Buckley. 2021 Equity Incentive Plan The board of directors and stockholders adopted our 2021 Equity Incentive Plan on August 24, 2021. Our 2021 Equity Incentive Plan, as amended (the “2021 Plan”), provides for the grant of incentive stock options, within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”), to our employees and our parent and subsidiary corporations’ employees, and for the grant of non-statutory stock options, stock appreciation rights, restricted stock, RSUs, performance units, and performance shares to our employees, directors, and consultants and our parent and subsidiary corporations’ employees and consultants. As of June 26, 2024, there were 4,299,957 shares of our common stock granted or available for grant under the 2021 Plan of which 1,496,807 are allocated to employees and consultants (vested and non-vested), 208,400 are allocated to Directors (vested and non-vested), and 2,519,750 were unallocated. Authorized Shares The number of shares of our common stock available for issuance under the 2021 Plan also includes an annual increase on the first day of each fiscal year beginning with the fiscal year ending March 31, 2025 and ending on (and including) the fiscal year ending March 31, 2031, in an amount equal to the least of: ● 500,000 shares of our common stock; or ● such number of shares of our common stock as the administrator may determine. 67 If an award granted under the 2021 Plan expires or becomes unexercisable without having been exercised in full, is surrendered pursuant to an exchange program or, with respect to restricted stock, RSUs, performance units, or performance shares, is forfeited to, or repurchased by, us due to failure to vest, then the unpurchased shares (or for awards other than stock options or stock appreciation rights, the forfeited or repurchased shares) which were subject thereto will become available for future grant or sale under the 2021 Plan (unless the 2021 Plan has terminated). With respect to stock appreciation rights, only the net shares actually issued will cease to be available under the 2021 Plan and all remaining shares under stock appreciation rights will remain available for future grant or sale under the 2021 Plan (unless the 2021 Plan has terminated). Shares that actually have been issued under the 2021 Plan under any award will not be returned to the 2021 Plan; provided, however, that if shares issued pursuant to awards of restricted stock, RSUs, performance shares, or performance units are repurchased or forfeited to us due to failure to vest, such shares will become available for future grant under the 2021 Plan. Shares used to pay the exercise price of an award or to satisfy the tax withholding obligations related to an award will become available for future grant or sale under the 2021 Plan. To the extent an award is paid out in cash rather than shares, the cash payment will not result in a reduction in the number of shares available for issuance under the 2021 Plan. Plan Administration The board of directors or one or more committees appointed by the board of directors will administer the 2021 Plan. In addition, if we determine it is desirable to qualify transactions under the 2021 Plan as exempt under Rule 16b-3, such transactions will be structured with the intent that they satisfy the requirements for exemption under Rule 16b-3. Subject to the provisions of the 2021 Plan, the administrator has the power to administer the 2021 Plan and make all determinations deemed necessary or advisable for administering the 2021 Plan, including the power to determine the fair market value of our common stock, select the service providers to whom awards may be granted, determine the number of shares covered by each award, approve forms of award agreement for use under the 2021 Plan, determine the terms and conditions of awards (including the exercise price, the time or times when the awards may be exercised, any vesting acceleration or waiver of forfeiture restrictions, and any restriction or limitation regarding any award or the shares relating thereto), construe and interpret the terms of the 2021 Plan and awards granted under it, prescribe, amend, and rescind rules and regulations relating to the 2021 Plan, including creating sub-plans, and modify or amend each award, including the discretionary authority to extend the post-termination exercisability period of awards (provided that no option or stock appreciation right will be extended past its original maximum term), temporarily suspend the exercisability of an award if the administrator deems such suspension to be necessary or appropriate for administrative purposes, and to allow a participant to defer the receipt of payment of cash or the delivery of shares that would otherwise be due to such participant under an award. The administrator may institute and determine the terms of an exchange program under which (i) outstanding awards are surrendered or cancelled in exchange for awards of the same type (which may have a higher or lower exercise price or different terms), awards of a different type and/or cash, (ii) participants would have the opportunity to transfer any outstanding awards to a financial institution or other person or entity selected by the administrator, and/or (iii) the exercise price of an outstanding award is increased or reduced. The administrator’s decisions, determinations, and interpretations are final and binding on all participants. Stock Options Stock options may be granted under the 2021 Plan in such amounts as the administrator will determine in accordance with the terms of the 2021 Plan. The exercise price of options granted under the 2021 Plan must at least be equal to the fair market value of our common stock on the date of grant. The term of an option will be stated in the award agreement, and in the case of an incentive stock option, may not exceed 10 years. With respect to any participant who owns stock representing more than 10% of the voting power of all classes of our outstanding stock, the term of an incentive stock option granted to such participant must not exceed five years and the exercise price must equal at least 110% of the fair market value on the date of grant. The administrator will determine the methods of payment of the exercise price of an option, which may include cash, shares, or other property acceptable to the administrator, as well as other types of consideration permitted by applicable law. After a participant ceases to provide service as an employee, director, or consultant, he or she may exercise his or her option for the period of time stated in his or her award agreement. In the absence of a specified time in an award agreement, if the cessation of service is due to death or disability, the option will remain exercisable for 12 months. In all other cases, in the absence of a specified time in an award agreement, the option will remain exercisable for three months following the cessation service. An option may not be exercised later than the expiration of its term. Subject to the provisions of the 2021 Plan, the administrator determines the other terms of options. 68 Stock Appreciation Rights Stock appreciation rights may be granted under the 2021 Plan. Stock appreciation rights allow the recipient to receive the appreciation in the fair market value of our common stock between the exercise date and the date of grant. Stock appreciation rights will expire upon the date determined by the administrator and set forth in the award agreement. After a participant ceases to provide service as an employee, director, or consultant, he or she may exercise his or her stock appreciation right for the period of time stated in his or her award agreement. In the absence of a specified time in an award agreement, if cessation of service is due to death or disability, the stock appreciation rights will remain exercisable for 12 months. In all other cases, in the absence of a specified time in an award agreement, the stock appreciation rights will remain exercisable for three months following the cessation of service. However, in no event may a stock appreciation right be exercised later than the expiration of its term. Subject to the provisions of the 2021 Plan, the administrator determines the other terms of stock appreciation rights, including when such rights become exercisable and whether to pay any increased appreciation in cash, shares of our common stock, or a combination thereof, except that the per share exercise price for the shares to be issued pursuant to the exercise of a stock appreciation right will be no less than 100% of the fair market value per share on the date of grant. Restricted Stock Restricted stock may be granted under the 2021 Plan. Restricted stock awards are grants of shares of our common stock that vest in accordance with terms and conditions established by the administrator (if any). The administrator will determine the number of shares of restricted stock granted to any employee, director, or consultant and, subject to the provisions of the 2021 Plan, will determine any terms and conditions of such awards. The administrator may impose whatever conditions to vesting it determines to be appropriate (for example, the administrator may set restrictions based on the achievement of specific performance goals or continued service to us); provided, however, that the administrator, in its sole discretion, may accelerate the time at which any restrictions will lapse or be removed. Recipients of restricted stock awards generally will have voting and dividend rights with respect to such shares upon grant without regard to vesting, unless the administrator provides otherwise. Shares of restricted stock that do not vest are subject to our right of repurchase or forfeiture. Restricted Stock Units RSUs may be granted under the 2021 Plan. RSUs are bookkeeping entries representing an amount equal to the fair market value of one share of our common stock. Subject to the provisions of the 2021 Plan, the administrator determines the terms and conditions of RSUs, including the vesting criteria, and the form and timing of payment. The administrator may set vesting criteria based upon the achievement of company-wide, divisional, business unit, or individual goals (including continued employment or service), applicable federal or state securities laws, or any other basis determined by the administrator in its discretion. The administrator, in its sole discretion, may pay earned RSUs in the form of cash, in shares, or in some combination thereof. Notwithstanding the foregoing, the administrator, in its sole discretion, may reduce or waive any vesting criteria that must be met to receive a payout. Performance Units and Performance Shares Performance units and performance shares may be granted under the 2021 Plan. Performance units and performance shares are awards that will result in a payment to a participant only if performance goals established by the administrator are achieved or the awards otherwise vest. The administrator will establish performance objectives or other vesting provisions in its discretion, which, depending on the extent to which they are met, will determine the number and/or the value of performance units and performance shares to be paid out to participants. The administrator may set performance objectives based upon the achievement of company-wide, divisional, business unit, or individual goals (including continued employment or service), applicable federal or state securities laws, or any other basis determined by the administrator in its discretion. After the grant of a performance unit or performance share, the administrator, in its sole discretion, may reduce or waive any performance objectives or other vesting provisions for such performance units or performance shares. Performance units will have an initial dollar value established by the administrator on or prior to the date of grant. Performance shares will have an initial value equal to the fair market value of our common stock on the date of grant. The administrator, in its sole discretion, may pay earned performance units or performance shares in the form of cash, in shares, or in some combination thereof. 69 Non-Employee Directors The 2021 Plan provides that all outside (non-employee) directors will be eligible to receive all types of awards (except for incentive stock options) under the 2021 Plan. In order to provide a maximum limit on the awards that can be made to tour non-employee directors, the 2021 Plan provides that in any given fiscal year, a non-employee director may not be paid, issued, or granted equity awards (including awards issued under the 2021 Plan) with an aggregate value (the value of which will be based on their grant date fair value determined in accordance with U.S. generally accepted accounting principles) and any other compensation (including without limitation any cash retainers or fees) that, in the aggregate, exceed $500,000 (excluding awards or other compensation paid or provided to him or her as a consultant or employee). The maximum limits do not reflect the intended size of any potential grants or a commitment to make grants to our outside directors under the 2021 Plan in the future. Non-Transferability of Awards Unless the administrator provides otherwise, the 2021 Plan generally does not allow for the transfer of awards and only the recipient of an award may exercise an award during his or her lifetime. If the administrator makes an award transferable, such award will contain such additional terms and conditions as the administrator deems appropriate. Certain Adjustments In the event of certain changes in our capitalization, to prevent diminution or enlargement of the benefits or potential benefits intended to be made available under the 2021 Plan, the administrator will adjust the number and class of shares that may be delivered under the 2021 Plan and/or the number, class, and price of shares covered by each outstanding award, and the numerical share limits set forth in the 2021 Plan. Dissolution or Liquidation In the event of our proposed dissolution or liquidation, the administrator will notify participants as soon as practicable prior to the effective date of such proposed transaction and all awards will terminate immediately prior to the consummation of such proposed transaction. Merger or Change in Control The 2021 Plan provides that in the event of our merger with or into another corporation or entity or a change in control (as defined in the 2021 Plan), each outstanding award will be treated as the administrator determines, including, without limitation, that (i) awards will be assumed, or substantially equivalent awards will be substituted, by the acquiring or succeeding corporation (or an affiliate thereof) with appropriate adjustments as to the number and kind of shares and prices, (ii) upon written notice to a participant, that the participant’s awards will terminate upon or immediately prior to the consummation of such merger or change in control, (iii) outstanding awards will vest and become exercisable, realizable, or payable, or restrictions applicable to an award will lapse, in whole or in part, prior to or upon consummation of such merger or change in control and, to the extent the administrator determines, terminate upon or immediately prior to the effectiveness of such merger or change in control, (iv) (A) the termination of an award in exchange for an amount of cash and/or property, if any, equal to the amount that would have been attained upon the exercise of such award or realization of the participant’s rights as of the date of the occurrence of the transaction (and, for the avoidance of doubt, if as of the date of the occurrence of the transaction the administrator determines in good faith that no amount would have been attained upon the exercise of such award or realization of the participant’s rights, then such award may be terminated by us without payment), or (B) the replacement of such award with other rights or property selected by the administrator in its sole discretion, or (v) any combination of the foregoing. The administrator will not be obligated to treat similarly all awards, all awards a participant holds, all awards of the same type, or all portions of awards. 70 In the event that the successor corporation does not assume or substitute for the award (or portions thereof), the participant will fully vest in and have the right to exercise all of his or her outstanding options and stock appreciations rights (or portions thereof) that is not assumed or substituted for, all restrictions on restricted stock, RSUs, performance shares, and performance units (or portions thereof) not assumed or substituted for will lapse, and, with respect to such awards with performance-based vesting (or portions thereof) not assumed or substituted for, all performance goals or other vesting criteria will be deemed achieved at 100% of target levels and all other terms and conditions met, in all cases, unless specifically provided otherwise under the applicable award agreement or other written agreement between the participant and us or any parent or subsidiary. Additionally, in the event an option or stock appreciation right (or portions thereof) is not assumed or substituted for in the event of a merger or change in control, the administrator will notify each participant in writing or electronically that the option or stock appreciation right (or its applicable portion), as applicable, will be exercisable for a period of time determined by the administrator in its sole discretion, and the option or stock appreciation right (or its applicable portion), as applicable, will terminate upon the expiration of such period. With respect to awards granted to an outside director, in the event of a change in control, the outside director’s options and stock appreciation rights, if any, will vest fully and become immediately exercisable, all restrictions on his or her restricted stock and RSUs will lapse, and, with respect to awards with performance-based vesting, all performance goals or other vesting requirements for his or her performance shares and units will be deemed achieved at 100% of target levels and all other terms and conditions met, in all cases, unless specifically provided otherwise under the applicable award agreement or other written agreement between the participant and us or any parent or subsidiary. The following table sets forth, for each executive officer, certain information concerning outstanding restricted stock awards as of March 31, 2024: Name Number of securities underlying unvested restricted stock awards (#) Fair Value ($) Vest date Mark Buckley 225,000 4.10 November 7, 2026 (1) (1) Fully vests on the fourth anniversary from contractual start date. The following table sets forth, for each executive officer, certain information concerning outstanding option awards as of March 31, 2024: Name Number of securities underlying unexercised options (exercisable) (#) Number of securities underlying unexercised options (unexercisable) (#) Option exercise price ($) Option expiration date Jane Gottschalk 68,172 - 3.50 January 1, 2027 (1) Jane Gottschalk - 300,000 4.10 March 4, 2029 (2) Jeff Clayborne - 300,000 4.10 March 4, 2034 (3) (1) All shares have fully vested. (2) 25% vest on the first, second, third, and fourth anniversaries from July 18, 2023. (3) 25% vest on the first, second, third, and fourth anniversaries from contractual start date. 71 Clawback Policy Awards are subject to the Company’s clawback policy, which was adopted on January 19, 2024 pursuant to Section 811 of the NYSE American Company Guide, Section 10D of the Exhchange Act, and Rule 10D-1 promulgated under the Exchange Act (the “Clawback Policy”). The Clawback Policy requires us to recoup incentive-based compensation from current and former executive officers in the event of an accounting restatement, subject to certain exceptions set forth in the policy. In addition, our board of directors, acting as the administrator of the Clawback Policy (such administrator to be the Compensation Committee if so designated by the board of directors) also may specify in an award agreement that the participant’s rights, payments, and benefits with respect to an award will be subject to reduction, cancellation, forfeiture, recoupment, reimbursement, or reacquisition upon the occurrence of certain specified events. The administrator of the Clawback Policy may require a participant to forfeit, return, or reimburse us all or a portion of the award and any amounts paid under the award pursuant to the terms of the Clawback Policy or applicable laws. Amendment; Termination The administrator has the authority to amend, alter, suspend, or terminate the 2021 Plan provided such action does not materially impair the existing rights of any participant. The 2021 Plan will automatically terminate in 2031, unless terminated sooner. Enterprise Management Incentive Sub-Plan The 2021 Plan includes an Enterprise Management Incentive Sub-Plan for the purpose of granting options to participants residing in the United Kingdom in compliance with the laws of the United Kingdom. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS Equity Compensation Plan Information The board of directors and stockholders adopted our 2021 Equity Incentive Plan on August 24, 2021. The 2021 Plan provides for the grant of incentive stock options, within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended, to our employees and our parent and subsidiary corporations’ employees, and for the grant of non-statutory stock options, stock appreciation rights, restricted stock, RSUs, performance units, and performance shares to our employees, directors, and consultants and our parent and subsidiary corporations’ employees and consultants. As of June 26, 2024, there were 4,299,957 shares of our common stock granted or available for grant under the 2021 Plan. The following information is as of March 31, 2024. Plan category Number of securities to be issued upon exercise of outstanding options, warrants, and rights Weighted-average exercise price of outstanding options, warrants, and rights Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in third column) Equity compensation plans approved by securityholders 1,197,012 $ 3.94 2,527,944 Equity compensation plans not approved by securityholders 136,344 $ 0.01 - Total 1,333,356 $ 3.54 2,527,944 Security Ownership of Certain Beneficial Owners The following table sets forth certain information regarding the beneficial ownership of our common stock as of June 26, 2024 for each person, or group of affiliated persons, known to us to beneficially own more than 5% of the common stock. The common stock is our only class of voting securities which is currently outstanding. Beneficial ownership of our common stock is determined under the rules of the SEC and generally includes any shares over which a person exercises sole or shared voting or investment power, or of which a person has a right to acquire ownership at any time within 60 days of the date of this Annual Report. Except as indicated by footnote, and subject to applicable community property laws, we believe the persons identified in the table have sole voting and investment power with respect to all shares of common stock beneficially owned by them. In the following table, percentage ownership is based on 15,653,449 shares of our common stock outstanding as of June 26, 2024, In computing the number of shares of common stock beneficially owned by a person and the percentage ownership of that person, we deemed to be outstanding all shares of common stock subject to options or other convertible securities held by that person or entity that are currently exercisable or releasable or that will become exercisable or releasable within 60 days of June 26, 2024. We did not deem these shares outstanding, however, for the purpose of computing the percentage ownership of any other person. Title of Class Name and address of Beneficial Owner Amount and Nature of Beneficial Ownership Percentage of Class Common stock Mark Tompkins (1) 1,040,000 6.2 % (1) The address of Mr. Tompkins is App 1, Via Guidino 23, 6900 Lugano-Paradiso, Switzerland. 72 Security Ownership of Management The following table sets forth certain information regarding the beneficial ownership of our common stock as of June 26, 2024 for each of our directors, named executive officers, and all of our directors and executive officers as a group. Unless otherwise indicated, the address of each of the following persons is 307 Canalot Studios, 222 Kensal Rd, London W10 5BN, United Kingdom, and each such person has sole voting and investment power with respect to the shares set forth opposite his, her or its name. Title of Class Name and address of Beneficial Owner Amount and Nature of Beneficial Ownership Percentage of Class Common stock Named Executive Officers and Directors: Max Gottschalk (2) 3,898,488 24.7 % Mark Buckley (3) 92,000 * Jeff Clayborne (4) 416 * Jane Gottschalk (5) 3,898,488 24.7 % Andre Keijsers (6) 14,645 * Berndt Hauptkorn (7) 1,600 * Tracy Barwin (8) 83 * Tim Nixdorff (9) 1,600 * All directors and executive officers as a group (8 persons) 4,008,832 25.4 % * Less than 1%. (2) Consists of (i) 3,479,491 shares of common stock held of record by Fermain; (ii) 242,625 shares of common stock held of record by JGA; (iii) 16,600 shares of common stock issuable held directly; (iv) 16,600 shares of common stock held by Mr. Gottschalks spouse, Jane Gottschalk; (v) 143,172 shares of common stock issuable upon the exercise of stock options by Mr. Gottschalk’s spouse, Jane Gottschalk; (vi) The total excludes 50,000 shares of our common stock underlying stock options not exercisable within 60 days of June 26, 2024; and (vii) The total excludes 225,000 shares of our common stock underlying stock options not exercisable within 60 days of June 26, 2024 held by Mr. Gottschalks spouse, Jane Gottschalk. (3) Consists of 92,000 shares of common stock held directly. The total excludes 225,000 restricted stock units that will not vest within 60 days of June 26, 2024. (4) Consists of 418 shares of common stock held directly. The total excludes 300,000 shares of our common stock underlying stock options not exercisable within 60 days of June 26, 2024. (5) Consists of (i) 3,479,491 shares of common stock held of record by Fermain; (ii) 242,625 shares of common stock held of record by JGA; (iii) 16,600 shares of common stock issuable held directly; (iv) 68,172 shares of common stock issuable upon the exercise of stock options; (v) 75,000 shares of common stock issuable upon the exercise of stock options that will vest within 60 days of June 26, 2024; (vi) 16,600 shares of common stock held by Ms. Gottschalks spouse, Max Gottschalk; (vii) The total excludes 225,000 shares of our common stock underlying stock options not exercisable within 60 days of June 26, 2024; and (viii) The total excludes 50,000 shares of our common stock underlying stock options not exercisable within 60 days of June 26, 2024 held by Ms. Gottschalks spouse, Max Gottschalk. (6) Consists of 14,645 shares of common stock held directly. The total excludes 43,200 shares of our common stock underlying stock options not exercisable within 60 days of June 26, 2024. (7) Consists of 1,600 shares of common stock held directly. The total excludes 36,000 shares of our common stock underlying stock options not exercisable within 60 days of June 26, 2024. (8) Consists of 83 shares of common stock held directly. The total excludes 43,200 shares of our common stock underlying stock options not exercisable within 60 days of June 26, 2024. (9) Consists of 1,600 shares of common stock held directly. The total excludes 36,000 shares of our common stock underlying stock options not exercisable within 60 days of June 26, 2024. 73 ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE Transactions with Related Persons We follow ASC 850, Related Party Disclosures, for the identification of related parties and disclosure of related party transactions. When and if we contemplate entering into a transaction in which any executive officer, director, nominee, or any family member of the foregoing would have a direct or indirect interest, regardless of the amount involved, the terms of such transaction are to be presented to our full board of directors (other than any interested director) for approval, and documented in the board minutes. SEC regulations define the related person transactions that require disclosure to include any transaction, arrangement or relationship in which the amount involved exceeds the lesser of $120,000 or one percent of the average of the Company’s total assets at year-end for the last two completed fiscal years ($68,130) in which we were or are to be a participant and in which a related person had or will have a direct or indirect material interest. A related person is: (i) an executive officer, director or director nominee of the company, (ii) a beneficial owner of more than 5% of our common stock, (iii) an immediate family member of an executive officer, director or director nominee or beneficial owner of more than 5% of our common stock, or (iv) any entity that is owned or controlled by any of the foregoing persons or in which any of the foregoing persons has a substantial ownership interest or control. In addition to the executive officer and director compensation arrangements discussed in “Executive Compensation,” the following is a description of all related person transactions that occurred during the fiscal year ended March 31, 2024. Consulting Agreements with Directors Certain directors of the Company and its subsidiaries provided consulting and advisory services to the Company, as non-employees, recognized in selling, general and administrative expenses in our consolidated financial statements contained elsewhere in this Annual Report. As of March 31, 2024, none of these expenses were unpaid. As of March 31, 2023, $22 of such expenses was unpaid and included in accrued expenses in our consolidated financial statements contained elsewhere in this Annual Report. Below are the directors of the Company and its subsidiaries, that provided consulting and advisory services during the year. Years ended March 31, 2024 2023 (Amounts in thousands) Max Gottschalk $ 181 $ 135 Jane Gottschalk - 48 Tracy Barwin 121 89 Andreas Keijsers 22 48 Total $ 324 $ 320 74 Max Gottschalk We, through PMA, are party to a consulting agreement with Max Gottschalk, dated May 15, 2019, which continues until terminated in accordance with its terms, during which Mr. Gottschalk is entitled to receive fees for services rendered amounting to £8,000 per month from April 2021 to November 2022 and £12,000 per month since December 2022. These amounts are in lieu of any other cash payments Mr. Gottschalk may otherwise have been entitled to receive as a member of our board of directors. Tracy Barwin We were party to a consulting agreement with Tracy Barwin, dated November 18, 2022, pursuant to which Ms. Barwin was entitled to receive £1,500 per day for services rendered with a minimum commitment of two days per month. These amounts were in lieu of any other cash payments or equity awards Ms. Barwin may otherwise have been entitled to receive as a member of our board of directors. The consulting agreement with Ms. Barwin was terminated in October 2023 and replaced by an independent director agreement. Arnhem Consulting Limited (Andre Keijsers) We, through PMA, were party to a consulting agreement with Arnhem Consulting Limited (“Arnhem”), a company controlled by Andre Keijsers, dated February 28, 2017, pursuant to which Arnhem was entitled to receive £1,200 per month for services rendered. The consulting agreement with Mr. Keijsers was terminated in September 2023 and replaced by an independent director agreement. Review, Approval or Ratification of Transactions with Related Parties Our board of directors reviews and approves transactions with directors, officers and holders of five percent or more of our voting securities and their affiliates, each a related party. The material facts as to the related party’s relationship or interest in the transaction are disclosed to our board of directors prior to their consideration of such transaction, and the transaction is not considered approved by our board of directors unless a majority of the directors who are not interested in the transaction approve the transaction. Further, when stockholders are entitled to vote on a transaction with a related party, the material facts of the related party’s relationship or interest in the transaction are disclosed to the stockholders, who must approve the transaction in good faith. We have adopted a written related party transactions policy that such transactions must be approved by our audit committee or another independent body of our board of directors. Director Independence As our common stock is currently listed for trading on the NYSE American, we have evaluated independence in accordance with the rules of the NYSE American Company Guide and the SEC with respect to each director and director nominee. Our board of directors undertook a review of the independence of its members and considered whether any director has a material relationship with us that could compromise his or her ability to exercise independent judgment in carrying out his or her responsibilities. Based upon the information requested from and provided by each director concerning their background, employment, and affiliations, including family relationships, our Board has determined that each of the following non-employee directors are independent as that term is defined under the rules of the NYSE American Company Guide. In making these determinations, our board of directors considered the current and prior relationships that each non-employee director has with us and all other facts and circumstances our board of directors deemed relevant in determining their independence, including the beneficial ownership of capital stock by each non-employee director, and the transactions involving their affiliates described in this Annual Report. All of the members of the Audit, Nomination, and Compensation Committees are also independent. Based on these standards, our board of directors determined Mark Buckley, Jeff Clayborne, Jane Gottschalk, and Max Gottschalk were not independent. 75 ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES Audit Fees The following table shows the fees that we paid for audit and other services provided by Weinberg & Company, P.A. and CohnReznick LLP, our independent registered public accounting firms for fiscal years ended 2024 and 2023, respectively. Fees 2024 2023 Audit Fees $ 266 $ 80 Audit Related Fees 37 - Other Fees related to initial public offering 177 21 Total Fees $ 480 $ 101 Audit Fees —This category includes the audit of our annual financial statements and services that are normally provided by the independent auditors in connection with engagements for those fiscal years. Audit-Related Fees — This category consists of assurance and related services by the independent auditor that are reasonably related to the performance of the audit or review of our financial statements and are not reported above under “Audit Fees”. All Other Fees — This category consists of fees for other miscellaneous items. Pre-Approval Policies and Procedures The Audit Committee has adopted policies and procedures to oversee the external audit process and pre-approves all services provided by our independent registered public accounting firm. All of the above services and fees were reviewed and approved by our board of directors or Audit Committee, as applicable, before the respective services were rendered. PART IV ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES (a)(1) Financial Statements Reference is made to the financial statements attached beginning on page F-1 of this Annual Report. (a)(2) Financial Statement Schedules None. (a)(3) Exhibits Reference is made to the exhibits listed on the Index to Exhibits. ITEM 16. FORM 10-K SUMMARY None. 76 Index to Financial Statements Report of Independent Registered Public Accounting Firm (PCAOB Firm ID: 572 ) F-2 Consolidated Financial Statements: Balance Sheets as of March 31, 2024 and March 31, 2023 F-3 Statements of Operations for the years ended March 31, 2024 and 2023 F-4 Statements of Changes in Stockholders’ Equity (Deficit) for the years ended March 31, 2024 and 2023 F-5 Statements of Cash Flows for the years ended March 31, 2024 and 2023 F-6 Notes to Consolidated Financial Statements for the years ended March 31, 2024 and 2023 F-7 F- 1 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors and Shareholders Perfect Moment Ltd and Subsidiaries Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Perfect Moment Ltd and Subsidiaries (the “Company”) as of March 31, 2024 and 2023, the related consolidated statements of operations and comprehensive loss, stockholders’ equity (deficit), and cash flows for the years then ended and the related notes (collectively referred to as the “financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company as of March 31, 2024 and 2023, and the results of its consolidated operations and its cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America. Going Concern The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2, the Company incurred recurring losses, had a net loss and used cash in operations during the year ended March 31, 2024, and the Company had an accumulated deficit at March 31, 2024. These matters raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 2 to the consolidated financial statements. These consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. Basis for Opinion These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. We have served as the Company’s auditor since 2023. /s/ Weinberg & Company, P.A. Weinberg & Company, P.A. Los Angeles, California July 1, 2024 F- 2 PERFECT MOMENT LTD. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Amounts in thousands, except share per share data) March 31, 2024 March 31, 2023 ASSETS Current assets: Cash and cash equivalents $ 7,910 $ 4,712 Accounts receivable, net 1,035 997 Inventories, net 2,230 2,262 Prepaid and other current assets 742 708 Total current assets $ 11,917 $ 8,679 Operating lease right-of-use assets 143 297 Property and equipment, net 502 833 Other non-current assets 47 12 Total assets $ 12,609 $ 9,821 LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) Current liabilities: Trade payables $ 1,584 $ 1,289 Accrued expenses 2,697 1,390 Trade finance facility - 26 Convertible debt obligations - 10,770 Operating lease liability, current 101 299 Unearned revenue 420 180 Total current liabilities $ 4,802 $ 13,954 Long Term liabilities: Operating lease liability, non-current 44 8 Total liabilities $ 4,846 $ 13,962 Commitments and contingencies - - Stockholders’ equity (deficit) Common stock, $ 0.0001 par value, 100,000,000 shares authorized: 15,653,449 and 4,824,352 shares issued and outstanding as of March 31, 2024 and March 31, 2023, respectively $ 1 $ - Series A and Series B convertible preferred stock; $ 0.0001 par value; 10,000,000 share authorized: 0 and 6,513,780 shares issued and outstanding as of March 31, 2024 and March 31, 2023, respectively - 1 Additional paid-in-capital 56,824 35,910 Accumulated other comprehensive (loss)/income ( 85 ) 203 Accumulated deficit ( 48,977 ) ( 40,255 ) Total stockholders’ equity (deficit) $ 7,763 $ ( 4,141 ) Total liabilities and stockholders’ equity (deficit) $ 12,609 $ 9,821 The accompanying notes are an integral part of these consolidated financial statements F- 3 PERFECT MOMENT LTD AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME/(LOSS) (Amounts in thousands, except share and per share data) Year Ended March 31, 2024 Year Ended March 31, 2023 Revenue, net Wholesale $ 14,060 $ 14,888 Ecommerce 10,383 8,550 Total Revenue, net 24,443 23,438 Cost of goods sold 15,212 14,682 Gross profit 9,231 8,756 Operating expenses: Selling, general and administrative expenses 12,122 12,369 Marketing and advertising expenses 4,784 5,012 Total operating expenses 16,906 17,381 Loss from operations ( 7,675 ) ( 8,625 ) Other income (expense), net Interest expense ( 1,311 ) ( 1,840 ) Foreign currency transactions gains 264 39 Total other income (expense), net ( 1,047 ) ( 1,801 ) Loss before income tax provision ( 8,722 ) ( 10,426 ) Income tax provision - 121 Net Loss ( 8,722 ) ( 10,305 ) Other comprehensive (losses) gains Foreign currency translation (loss) gains ( 288 ) 303 Comprehensive loss $ ( 9,010 ) $ ( 10,002 ) Basic and diluted loss per share $ ( 1.34 ) $ ( 2.16 ) Basic and Diluted weighted-average number of shares outstanding 6,518,960 4,767,777 The accompanying notes are an integral part of these consolidated financial statements F- 4 PERFECT MOMENT LTD AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT) For the Years Ended March 31, 2024 and 2023 (Amounts in thousands, except share data) Shares Amount Shares Amount Shares Amount Capital Income (Loss) Deficit Deficit Preference Shares Accumulated Series A Convertible Series B Convertible Common Shares Additional Paid-in Other Comprehensive Accumulated Total Stock holders’ Shares Amount Shares Amount Shares Amount Capital Income (Loss) Deficit Deficit Balance -March 31, 2022 5,323,782 $ 1 - $ - 3,749,352 $ - $ 26,674 $ ( 100 ) $ ( 29,950 ) $ ( 3,375 ) Stock compensation expense for employee vested options - - - - - - 241 - - 241 Issuance of common stock to consultants - - - - 1,075,000 - 3,795 - - 3,795 Issuance of preference shares for cash - - 1,189,998 - - - 5,200 - - 5,200 Foreign currency translation adjustment - - - - - - - 303 - 303 Net loss - - - - - - - - ( 10,305 ) ( 10,305 ) Balance - March 31, 2023 5,323,782 $ 1 1,189,998 $ - 4,824,352 $ - $ 35,910 $ 203 $ ( 40,255 ) $ ( 4,141 ) Balance 5,323,782 $ 1 1,189,998 $ - 4,824,352 $ - $ 35,910 $ 203 $ ( 40,255 ) $ ( 4,141 ) Stock compensation expense for employee vested RSUs and options - - - - 75,000 - 739 - - 739 Issuance of common stock for cash - - - - 409,050 - 2,179 - - 2,179 Sale of common stock from public offering - - - - 1,334,000 - 6,009 - - 6,009 Issuance of common stock upon conversion of convertible debt and accrued interest - - - - 2,497,267 - 11,987 - - 11,987 Issuance of common stock upon conversion of series A convertible stock ( 5,323,782 ) ( 1 ) - - 5,323,782 1 - - - - Issuance of common stock upon conversion of series B convertible stock - - ( 1,189,998 ) - 1,189,998 - - - - - Foreign currency translation adjustment - - - - - - - ( 288 ) - ( 288 ) Net loss - - - - - - - - ( 8,722 ) ( 8,722 ) Net income (loss) - - - - - - - - ( 8,722 ) ( 8,722 ) Balance – March 31, 2024 - $ - - $ - 15,653,449 $ 1 $ 56,824 $ ( 85 ) $ ( 48,977 ) $ 7,763 Balance - $ - - $ - 15,653,449 $ 1 $ 56,824 $ ( 85 ) $ ( 48,977 ) $ 7,763 The accompanying notes are an integral part of these consolidated financial statements F- 5 PERFECT MOMENT LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (Amounts in thousands) March 31, 2024 March 31, 2023 For the Year Ended March 31, 2024 March 31, 2023 Operating Activities: Net loss $ ( 8,722 ) $ ( 10,305 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization 555 547 Bad debt expense 217 80 Inventory reserve 382 374 Unrealized foreign exchange (gain) loss ( 128 ) 334 Stock based compensation – employees 739 241 Stock based compensation – legal and consulting services - 3,795 Stock based compensation - 3,795 Amortization of stock-based marketing services 185 1,483 Amortization of convertible debt finance costs 492 941 Accrued interest 725 760 Effect of changes in assets and liabilities: Accounts receivable ( 238 ) ( 519 ) Inventories ( 349 ) ( 812 ) Prepaid and other current assets ( 219 ) 321 Operating lease right of use asset 268 184 Other non-current assets ( 37 ) - Operating lease right-of-use liability ( 162 ) ( 174 ) Trade payables 295 ( 759 ) Accrued expenses 1,304 514 Unearned revenue 240 ( 515 ) Net cash used in operating activities ( 4,453 ) ( 3,510 ) Investing Activities: Purchases of property and equipment ( 211 ) ( 249 ) Net cash used by investing activities ( 211 ) ( 249 ) Financing Activities: Proceeds from initial public offering 6,009 - Proceeds from sale of common stock 2,179 - Proceeds from issuance of preference shares, net - 5,200 Proceeds from convertible debt obligations, net - 2,555 Repayment of shareholder loans - ( 565 ) Proceeds from trade finance facility 1,847 4,132 Repayment of trade finance facility ( 1,873 ) ( 4,371 ) Repayment of other borrowings, net - ( 21 ) Net cash provided by financing activities 8,162 6,930 Effect of Exchange Rate Changes on Cash ( 300 ) ( 34 ) Net change in cash 3,198 3,137 Cash - beginning of period 4,712 1,575 Cash - end of period $ 7,910 $ 4,712 Supplemental disclosures of cash flow information: Interest paid on borrowings and bank loans $ 107 $ 139 Corporation tax received $ - $ 121 Supplemental disclosure of non-cash investing and financing activities: Conversion of convertible debt and accrued interest to common stock $ 11,987 $ - Recognition of operating lease right of use assets and lease obligations $ 198 $ 404 Write-off of expired operating lease right-of-use assets and lease obligations 53 - Offset of deferred offering costs to proceeds received $ 1,169 $ - The accompanying notes are an integral part of these consolidated financial statements F- 6 PERFECT MOMENT LTD AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED MARCH 31, 2024 AND 2023 1. NATURE OF OPERATIONS AND BASIS OF PRESENTATION Nature of operations Perfect Moment Ltd., a Delaware corporation (“Perfect Moment” or “PML” and, together with its subsidiaries unless the context otherwise requires, the “Company”), is an owner and operator of a luxury fashion brand that offers ski, surf, and activewear collections under the brand name Perfect Moment. The Company’s collections are sold directly to customers through ecommerce, sales to wholesale accounts and through other sales partnerships. Basis of presentation These consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) and present the consolidated financial position, income (loss), comprehensive income (loss), and cash flows of the Company and its wholly owned subsidiaries. The figures in the notes to the financials are presented in thousands, therefore the 000’s are removed. Principles of consolidation These consolidated financial statements include the accounts of Perfect Moment Ltd. and its wholly owned subsidiaries; Perfect Moment Asia Limited (“PMA”), Perfect Moment (UK) Limited (“PMUK”), Perfect Moment USA, Inc., (“PMUSA”) and Perfect Moment TM Sarl. All intercompany balances and transactions have been eliminated. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Going concern The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities and commitments in the ordinary course of business. Through March 31, 2024, the Company has funded its operations with proceeds from the sale of common stock from the initial public offering and the issuance of common stock, alongside existing trade, invoice and shareholder financing arrangements. The Company has incurred recurring losses, including a net loss of $ 8,722 for the year ended March 31, 2024 and used cash in operations of $ 4,453 during that period. As of March 31, 2024, the Company had an accumulated deficit of $ 48,977 . F- 7 These factors raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying Consolidated Financial Statements do not include any adjustments as a result of this uncertainty. Management’s plans to alleviate the conditions that raise substantial doubt include: ● Taking out short-term loans and debt factoring to assist with working capital shortfalls ● Exploring sources of long-term funding in the private markets and additional equity financing ● Closely monitoring the collection of debts ● Strategies and plans in place to deliver improved margins in the next financial year The Company’s ability to continue as a going concern for 12 months from the date these Consolidated Financial Statements were available to be issued is dependent upon its ability to generate sufficient cash flows from operations to meet its obligations, which it has not been able to accomplish to date, and to obtain additional capital financing. No assurance can be given that the Company will be successful in these efforts mentioned above. During the year ended March 31, 2024, the Company generated net proceeds totaling $ 8,188 from the sale of our common stock and converted all outstanding convertible debt obligations to equity as part of our initial public offering (“IPO”). Use of Estimates The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and judgments in applying the Company’s accounting policies that affect the reported amounts and disclosures made in the consolidated financial statements and accompanying notes. Management continually evaluates the estimates and judgments it uses. These estimates and judgments have been applied in a manner consistent with prior periods and there are no known trends, commitments, events or uncertainties that management believe will materially affect the methodology or assumptions utilized in making these estimates and judgments in these financial statements. Significant estimates inherent in the preparation of the consolidated financial statements include reserves for uncollectible accounts receivables, realizability of inventory; customer returns; useful lives and impairments of long-lived tangible and intangible assets; realization of deferred tax assets and related uncertain tax positions; and the valuation of stock-based compensation awards. Actual results may differ from these judgements and estimates under different assumptions or conditions and any such differences may be material. Revenue Recognition The majority of the Company’s revenue is recognized at a point in time based on the transfer of control. In addition, the majority of the Company’s contracts do not contain variable consideration and contract modifications are minimal. The majority of the Company’s revenue arrangements generally consist of a single performance obligation to transfer promised goods. Revenue is reported net of markdowns, discounts and sales taxes collected from customers on behalf of taxing authorities. Revenue is also presented net of an allowance for expected returns where contracts include the right of return. F- 8 The Company estimates returns on an ongoing basis to estimate the consideration from the customer that the Company expects to ultimately receive. Consideration in determining the Company’s estimates for returns may include agreements with customers, the Company’s return policy and historical and current trends. The Company records the returns as a reduction to net sales in its consolidated statements of operations and the recognition of a provision for returns within accrued expenses in its consolidated balance sheets and the estimated value of inventory expected to be returned as an adjustment to inventories, net. As of March 31, 2024 and 2023, the returns provision was $ 346 and $ 366 , respectively. Revenue is comprised of direct-to-consumer ecommerce revenue through the Company’s website and revenue related to wholesalers. The following table details the revenue split: SCHEDULE OF REVENUE SPLIT March 31, 2024 March 31, 2023 Wholesale revenues $ 14,060 $ 14,888 Ecommerce revenues 10,383 8,550 Total Revenues $ 24,443 $ 23,438 Revenue is recognized when performance obligations are satisfied through the transfer of control of promised goods to the Company’s customers. Control transfers once a customer has the ability to direct the use of, and obtain substantially all of the benefits from, the product. This includes the transfer of legal title, physical possession, the risks and rewards of ownership, and customer acceptance. For direct-to-consumer ecommerce revenue, the Company receives payment before the customer receives the promised goods. Revenue is only recognized once the goods have been delivered to the customer. Sales to wholesale customers are recognized when the customer has control which will depend on the agreed upon International Commercial Terms (“inco-terms”). For inventories sold on consignment to wholesalers, the Company records revenue when the inventory is sold to the third-party customer by the wholesaler. The Company may issue merchant credits, which are essentially refund credits. The merchant credits are initially deferred and subsequently recognized as revenue when tendered for payment. Cost of goods sold Cost of goods sold includes the cost of purchased merchandise, which includes: - acquisition and production costs including raw material and labor as applicable; - the cost incurred to deliver inventory to the Company’s third-party distribution centers including freight, non-refundable taxes, duty, and other landing costs; - the service fees of the Company’s third-party fulfillment and distribution centers; and - reserves for inventory. F- 9 Accounts receivable Accounts receivable primarily arise out of sales to wholesale accounts and ecommerce partners. The allowance for doubtful accounts represents management’s best estimate of probable credit losses in accounts receivable using the incurred loss methodology. Receivables are written off against the allowance when management believes that it is probable the amount receivable will not be recovered. Additionally, the Company records higher allowances in the first and third quarters following its peak sales seasons after the Company determines it to be probable that it will not collect the related receivables. As of March 31, 2024 and 2023, the Company had $ 558 and $ 341 , respectively, in allowances for doubtful accounts. Accounts Receivable, net of allowances, as of March 31, 2024 and 2023 was $ 1,035 and $ 997 , respectively. Geographic concentration Although the Company is organized fundamentally as one business segment, the Company’s revenues are primarily split between three geographic areas: the U.S., Europe and the United Kingdom (the “U.K.”). Customers in these regions are served by our leadership, production and operations teams in the U.K. and Hong Kong. The table below reflects total net revenues attributed to Europe (excluding the United Kingdom), United States, United Kingdom, and the rest of the world: SCHEDULE OF NET REVENUE FROM GEOGRAPHIC AREAS March 31, 2024 March 31, 2023 Year Ended March 31, 2024 March 31, 2023 Europe (excluding United Kingdom) $ 7,909 32 % $ 7,233 31 % United States 9,935 41 % 10,348 44 % United Kingdom 4,845 20 % 4,269 18 % Rest of the World 1,754 7 % 1,588 7 % Total Revenues $ 24,443 $ 23,438 The long-lived assets of the Company primarily relate to property and equipment, intangible assets and operating lease right-of-use assets in the U.K. and Hong Kong. Total long-lived assets as of March 31, 2024 were $ 557 and $ 98 in the U.K. and Hong Kong, respectively. As of March 31, 2023, total long-lived assets were $ 1,086 in the UK and $ 56 in Hong Kong. Supplier concentration For the years ended March 31, 2024 and 2023, the largest single supplier of manufactured goods, Everich Garments Group Ltd., produced 75 % and 72 %, respectively, of the Company’s products. For the years ended March 31, 2024 and 2023, the largest fabric supplier, Toray International Inc., supplied 79 % and 70 %, respectively, of the fabric used to manufacture the Company’s products. Customer concentration For the twelve months ended March 31, 2024, we had one customer that accounted for approximately 13 % or $ 3,168 of total revenues individually and in aggregate. There was no accounts receivable balance for this customer as of March 31, 2024. The Company has ended its wholesale relationship with this customer as part of a broader strategy to enhance our relationships with our entire customer base. For the twelve months ended March 31, 2023, we had one customer that accounted for approximately 12 % or $ 2,786 of total revenues individually and in aggregate. The related accounts receivable balance for this customer was approximately $ 41 as of March 31, 2023. Accounts receivable For the twelve months ended March 31, 2024, we had two customers that accounted for approximately 27 % of total accounts receivable. For the twelve months ended March 31, 2023, we had one customer that accounted for approximately 18 % of total accounts receivable. Accounts payable On March 31, 2024, the three largest accounts payable accounts to our vendors represented 15 %, 7 % and 6 %, respectively. On March 31, 2023, the three largest accounts payable accounts to our vendors represented 56 %, 5 % and 3 %, respectively. F- 10 Property and Equipment Property, plant and equipment are recorded at cost less accumulated depreciation. Cost consists of purchase price, conversion cost and estimated cost of dismantling and restoration. Expenditure such as repairs and maintenance, overhaul costs and borrowing costs are normally charged to profit or loss when they are incurred. Expenditures resulting in increases in the future economic benefits of the property, plant and equipment are capitalized. Software & Website Development costs are for applications and software with respect to operating our business. For such projects, planning cost and other costs related to the preliminary project stage, as well as costs incurred for post-implementation activities, are expensed as incurred. We capitalize costs incurred during the application development phase only when we believe it is probable the development will result in new or additional functionality. The types of costs capitalized during the application development phase include fees incurred with third parties for consulting, programming and other development activities performed to complete the software or website. We amortize the assets on a straight-line basis over an estimated useful life of three years. If we identify any software or website to be abandoned, the cost less the accumulated amortization, if any, is recorded as amortization expense. The residual values and useful lives of the property, plant and equipment are reviewed when there are indications that the residual value or useful life of an asset has significantly changed following the end of the previous reporting period. If necessary, the residual value, depreciation method or useful life of that asset is amended prospectively to reflect the new expectation. The following estimated useful lives are used for the depreciation of property, plant and equipment: SCHEDULE OF ESTIMATED USEFUL LIVES IN PROPERTY AND EQUIPMENT Useful Life Method Furniture and Fixtures 5 years Straight-line Office Equipment 3 - 5 years Straight-line Leasehold Improvements 5 years Straight-line Software & Website Development 3 years Straight-line Computer Equipment 3 years Straight-line Leases At lease commencement, which is generally when the Company takes possession of the asset, the Company records a lease liability and corresponding right-of-use asset. Lease liabilities represent the present value of minimum lease payments over the expected lease term, which includes options to extend or terminate the lease when it is reasonably certain those options will be exercised. The present value of the lease liability is determined using the Company’s incremental borrowing rate as of lease commencement. Minimum lease payments include base rent, fixed escalation of rental payments, and rental payments that are adjusted periodically depending on a rate or index. Non-lease components are generally services that the lessor performs for the Company associated with the leased asset, such as common area maintenance. Right-of-use assets represent the right to control the use of the leased asset during the lease and are initially recognized in an amount equal to the lease liability. In addition, prepaid rent, initial direct costs, and adjustments for lease incentives are components of the right-of-use asset. Over the lease term, the lease expense is amortized on a straight-line basis beginning on the lease commencement date. A right-of-use asset and lease liability are not recognized for leases with an initial term of 12 months or less, and the lease expense is recognized on a straight-line basis over the lease term. As of March 31, 2024 and March 31, 2023, the Company has four property leases, which are all accounted for as operating leases under ASC 842. Short-term leases are accounted for under the short-term lease practical expedient of ASC 842. F- 11 Long-Lived Asset s Long-lived assets held for use, including intangible assets with finite lives, right-of-use assets and property, plant and equipment, are evaluated for impairment when the occurrence of events or a change in circumstances indicates that the carrying value of the assets may not be recoverable as measured by comparing their carrying value to the estimated undiscounted future cash flows generated by their use and eventual disposition. Impaired assets are recorded at fair value, determined principally by discounting the future cash flows expected from their use and eventual disposition. Reductions in asset values resulting from impairment valuations are recognized in income in the period that the impairment is determined. No impairment of long-lived assets was required for the years ended March 31, 2024 and 2023. Income Taxes The Company follows the liability method with respect to accounting for income taxes. Deferred income tax assets and liabilities are determined based on the temporary differences between the carrying amounts and the tax bases of assets and liabilities, and for tax losses, tax credit carryforwards, and other tax attributes. Deferred income tax assets and liabilities are measured using enacted tax rates, for the appropriate tax jurisdiction, which are expected to be in effect when these differences are anticipated to reverse. Deferred income tax assets are reduced by a valuation allowance, if based on the weight of available evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The evaluation as to the likelihood of realizing the benefit of a deferred income tax asset is based on the timing of scheduled reversals of deferred tax liabilities, taxable income forecasts, and tax-planning strategies. The recognition of a deferred income tax asset is based upon several assumptions and forecasts, including current and anticipated taxable income, the utilization of previously unrealized non-operating loss carryforwards, and regulatory reviews of tax filings. The Company evaluates its tax filing positions and recognizes tax benefits that are considered more likely than not to be sustained upon examination by the relevant taxing authorities based on the technical merits of the position. This determination requires the use of significant judgment. Income tax expense is adjusted in the period in which an uncertain tax position is effectively settled, the statute of limitations expires, facts or circumstances change, tax laws change, or new information becomes available. The Company’s policy is to recognize interest expense and penalties related to income tax matters separately as an income or expense item. Selling, general and administrative expenses Selling, general and administrative expenses consist of all operating costs not otherwise included in cost of goods sold or marketing and advertising expenses. The Company’s selling, general and administrative expenses include personnel costs, sales commissions, recruitment fees, legal and professional fees, information technology, accounting, travel and lodging, occupancy costs and depreciation and amortization. Foreign currency Foreign currency transactions denominated in a currency other than an entity’s functional currency are remeasured into the functional currency using the spot rate at the date of the transaction with any resulting gains and losses recognized in operating expenses except for gains and losses arising on intercompany foreign currency transactions that are of a long-term investment nature, which are recorded as a foreign currency translation adjustment in other comprehensive income or loss The functional currency for each entity included in these Consolidated Financial Statements that is domiciled outside of the United States is generally the applicable local currency. Assets and liabilities of each foreign entity are translated into U.S. dollars at the exchange rate in effect on the balance sheet date. Revenue and expenses are translated on a monthly basis using the average rate for that month as a close approximation. Unrealized translation gains and losses are recorded as a foreign currency translation adjustment, which is included in other comprehensive income or loss, which is a component of accumulated other comprehensive income or loss included in stockholders’ equity (deficit). F- 12 Stock-based compensation The Company accounts for equity based awards based on ASC 505 and 718, whereby the value of the award is measured on the date of grant and recognized as compensation expense on a straight-line basis over the vesting period. The Company measures fair value as of the grant date for options and warrants using the Black Scholes option pricing model and for common share awards using a weighted average of the Black Scholes method and probability-weighted expected return method (PWERM). The inputs into the Black Scholes option pricing model are subjective and generally require significant judgment. The fair value of the shares of common and preferred stock has historically been determined by the Company’s management with the assistance of third-party specialists as there was no public market for the common stock. The fair value is obtained by considering a number of objective and subjective factors, including the valuation of comparable companies, sales of preferred stock to unrelated third parties, projected operating and financial performance, the lack of liquidity of common and preferred stock and general and industry specific economic outlook, amongst other factors. The expected term represents the period that the Company’s stock options are expected to be outstanding and is determined using the simplified method (based on the mid-point between the vesting date and the end of the contractual term) as the Company’s stock option exercise history does not provide a reasonable basis upon which to estimate expected term. Because the Company was privately held for a portion of the periods covered by these financial statements and historically did not have an active trading market for its common and preferred stock for a sufficient period of time, the expected volatility was estimated based on the average volatility for comparable publicly traded companies, over a period equal to the expected term of the stock option grants. The Company listing on NYSE American on February 8, 2024 and now uses the closing price on the day of grant to determine FMV and for the stock options issued in Q4 2024 the company used the average of five similar companies based by one or all the following factors to determine volatility: industry, revenue, market capitalization. The risk-free rate assumption is based on the U.S. Treasury zero coupon issues in effect at the time of grant for periods corresponding with the expected term of the option. The Company has never paid dividends on its common stock and does not anticipate paying dividends on common stock in the foreseeable future. Therefore, the Company uses an expected dividend yield of zero . Income / loss per share of common stock Basic net income (loss) per share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding for the period. Diluted earnings per share is computed by dividing the net income applicable to common stockholders by the weighted average number of shares of common stock outstanding plus the number of additional shares of common stock that would have been outstanding if all dilutive potential shares of common stock had been issued using the treasury stock method. Potential shares of common stock are excluded from the computation when their effect is antidilutive. The dilutive effect of potentially dilutive securities is reflected in diluted net income per share if the exercise prices were lower than the average fair market value of common stock during the reporting period. Potentially dilutive stock options and securities as presented in the table below were excluded from the computation of diluted net income (loss) per share, because the effect would be anti-dilutive. As the Company incurred losses in the years ended March 31, 2024 and 2023, basic and diluted weighted-average shares are the same in the loss per share calculation, in accordance with ASC 260-10-45-20. F- 13 SCHEDULE OF ANTIDILUTIVE SECURITIES EXCLUDED FROM COMPUTATION OF DILUTED NET INCOME (LOSS) PER SHARE March 31, 2024 March 31, 2023 Options to acquire common stock 1,108,356 299,957 Restricted stock units to acquire stock 225,000 - Warrants to acquire common stock 66,700 - Series A convertible preferred stock - 5,323,782 Series B convertible preferred stock - 1,189,998 Convertible debt financing - 2,815,463 Antidilutive securities 1,400,056 9,629,200 On February 12, 2024, all outstanding shares of our Series A and Series B convertible preferred stock were automatically converted into 5,323,782 and 1,189,998 shares of common stock, respectively, in connection with the closing of the initial public offering. The $ 10,002 in principal amount plus accrued interest in the amount of $ 1,985 automatically converted into Company common stock, at 80 % of the initial public offering price into an aggregate of 2,497,267 shares of common stock (see note 11). Fair Value of Financial Instruments The Company follows the guidance of FASB ASC 820 and ASC 825 for disclosure and measurement of the fair value of its financial instruments. FASB ASC 820 establishes a framework for measuring fair value under GAAP and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, ASC 820 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy defined by ASC 820 are described below: Level 1: Quoted market prices available in active markets for identical assets or liabilities as of the reporting date. Level 2: Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. Level 3: Pricing inputs that are generally observable inputs and not corroborated by market data. The carrying amount of the Company’s financial assets and liabilities, such as cash and cash equivalents, prepaid expenses, and accounts payable and accrued expenses approximate their fair value due to their short-term nature. The carrying values of capital lease obligations and debt obligations approximate their fair values due to the fact that the interest rates on these obligations are based on prevailing market interest rates. Unless otherwise noted, it is management’s opinion that the Company is not exposed to significant interest or credit risks arising from these financial instruments. Segment Reporting Accounting Standards Codification (“ASC”) Topic 280, “Disclosures about Segments of an Enterprise and Related Information” establishes standards for the way that public business enterprises report information about operating segments in annual financial statements and requires those enterprises to report selected information about operating segments in interim financial reports issued to stockholders. Management has determined that the Company operates in one business segment, product sales. Reclassifications The Company has reclassified broker commission costs amounting to $ 687 previously classified as cost of sales for the year ended March 31, 2023 to selling, general and administrative expenses to conform to current year presentation. F- 14 Recently Issued Accounting Pronouncements In September 2022, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) No. 2022-04, “Disclosure of Supplier Finance Program Obligations” (“ASU 2022-04”). ASU 2022-04 requires entities to disclose the key terms of supplier finance programs they use in connection with the purchase of goods and services, along with the amount of obligations outstanding at the end of each period and an annual roll forward of such obligations. This standard does not affect the recognition, measurement, or financial statement presentation of supplier finance program obligations. ASU 2022-04 is effective for the Company for the year ending March 31, 2024 and is to be applied retrospectively to all periods in which a balance sheet is presented. The annual roll forward disclosure is not required to be made until the year ending March 31, 2025 and is to be applied prospectively. The Company doesn’t believe the adoption will have a material effect on the financial statements. Other than the new disclosure requirements, ASU 2022-04 will not have an impact on the Company’s consolidated financial statements. In March 2023, the Financial Accounting Standards Board (“FASB”) ) issued ASU 2024-01 to amend the guidance in Accounting Standards Codification (“ASC”) 718 Compensation—Stock Compensation (Topic 718) . Some entities compensate employees or other service providers by granting profits interest awards, which generally give the grantee an opportunity to participate in future profits and/or equity appreciation of the entity but do not give them rights to existing net assets of the entity . ASU 2024-01 adds an example showing how to apply the scope guidance in ASC 718 to determine whether profits interests and similar awards should be accounted for as share-based payment arrangements. The ASU is effective for annual periods beginning after December 15, 2024, with early adoption permitted. The Company does not currently anticipate that the guidance will have a material impact on its financial statements. In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosure , which is intended to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expense categories that are regularly provided to the chief operating decision maker and included in each reported measure of a segment’s profit or loss. The update also requires all annual disclosures about a reportable segment’s profit or loss and assets to be provided in interim periods and for entities with a single reportable segment to provide all the disclosures required by ASC 280, Segment Reporting , including the significant segment expense disclosures. This standard will be effective for the Company on January 1, 2024 and interim periods beginning in fiscal year 2025, with early adoption permitted. The updates required by this standard should be applied retrospectively to all periods presented in the financial statements. The Company does not expect this standard to have a material impact on its results of operations, financial position or cash flows. ASUs recently issued but not listed above were assessed and determined to be either not applicable or are expected to have minimal impact on the consolidated financial position or results of operations. 3. INVENTORIES Inventories are initially measured at cost and subsequently measured at the lower of cost or net realizable value. Cost is determined on a first-in, first-out basis. The following table details the primary categories for the periods presented. SCHEDULE OF INVENTORY March 31, 2024 March 31, 2023 $’000 $’000 Finished goods $ 2,680 $ 2,685 Raw materials 721 585 Goods in transit 14 - Finished goods on consignment 205 - Total inventories 3,620 3,270 Inventory reserve ( 1,390 ) ( 1,008 ) Total inventories, net $ 2,230 $ 2,262 Third-party services are used to warehouse and distribute inventory. Per the terms of one third-party service contract, a lien may be placed on the Company’s inventory if the Company fails to make a payment for services within 30 days from the date the third-party supplier notifies the Company of an outstanding payment. 4. PREPAID AND OTHER CURRENT ASSETS Amounts recorded in prepaid and other current assets are expected to be realized within one year. The following table describes the major items for the periods presented. SCHEDULE OF PREPAID AND OTHER CURRENT ASSETS March 31, 2024 March 31, 2023 $’000 $’000 Deposits and prepayments 436 150 Prepaid marketing costs - 185 Other receivables 306 373 Total 742 708 Prepaid marketing costs relate to the provision of marketing services to be provided over an 18-month service period by two non-employees. F- 15 5. PROPERTY AND EQUIPMENT Property and equipment consisted of the following: SCHEDULE OF PROPERTY AND EQUIPMENT March 31, 2024 March 31, 2023 $’000 $’000 Furniture and Fixtures $ 177 $ 177 Office Equipment 57 52 Leasehold Improvements 29 29 Software and Website Development 1,886 1,676 Computer Equipment 121 91 Property and equipment, gross 2,270 2,025 Accumulated depreciation ( 1,768 ) ( 1,192 ) Property and equipment, net $ 502 $ 833 Depreciation expense related to property, plant and equipment was $ 555 million and $ 547 million in the years ended March 31, 2024 and 2023, respectively. 6. LEASES The Company has obligations under operating leases for its offices. As of March 31, 2024 and 2023, the lease terms of the various leases are less than 24 months. The majority of the Company’s leases include renewal options at the sole discretion of the Company. In general, it is not reasonably certain that lease renewals will be exercised at lease commencement and therefore lease renewals are not included in the lease term. The following table details the Company’s net lease expense. The variable lease expenses disclosed below include contingent rent payments and other non-fixed lease related costs, including common area maintenance, property taxes, and landlord’s insurance. SCHEDULE OF LEASE EXPENSE Lease expense March 31, 2024 March 31, 2023 Years Ended Lease expense March 31, 2024 March 31, 2023 $’000 $’000 Net lease expense: Operating lease expense $ 299 $ 210 Total lease expense $ 299 $ 210 Weighted-average remaining lease term - Years 1.53 0.96 Weighted-average discount rate 5 % 9 % SCHEDULE OF LEASE BALANCE SHEET CLASSIFICATION Balance sheet classification March 31, 2024 March 31, 2023 $’000 $’000 Right-of-use assets $ 143 $ 297 Current lease liabilities $ 101 $ 299 Non-current lease liabilities 44 8 Total operating lease liabilities $ 145 $ 307 F- 16 SCHEDULE OF FUTURE MATURITY OF LEASE LIABILITIES Maturity of lease liabilities March 31, 2024 March 31, 2023 $’000 $’000 Within one year $ 109 $ 318 Within one to two years 45 9 Total lease payments 154 327 Discount rate ( 9 ) ( 20 ) Present value of lease liabilities $ 145 $ 307 7. ACCRUED EXPENSES SCHEDULE OF ACCRUED EXPENSES March 31, 2024 March 31, 2023 $’000 $’000 Accrued expenses $ 1,002 $ 606 Returns provision 298 366 Accrued import duties 294 - Merchant credit 63 61 Indirect taxes 1,040 357 Total $ 2,697 $ 1,390 The returns provisions are comprised of returns due from both wholesale and partner customers and direct-to-consumer customers. 8. TRADE FINANCE FACILITY SCHEDULE OF TRADE FINANCE FACILITY March 31, 2024 March 31, 2023 $’000 $’000 Trade finance facility $ - $ 26 Total $ - $ 26 The Company, through PMA, has a trade finance facility extended on goods for which letters of credit are issued to the Company’s suppliers by HSBC. As of March 31, 2024 and March 31, 2023, the outstanding balance under the trade finance facility was $ 0 and $ 26 , respectively, and the Company had an available trade finance facility of $ 5.0 million. As of March 31, 2024, there were no outstanding pledged letters of credit by HSBC. The trade finance facility does not become the Company’s responsibility until the Company receives the manufactured clothing goods from suppliers. Once drawn, the company has 120 days credit on the loan before repayment is due. For drawings in Hong Kong dollars, the interest rate equals HIBOR plus 3.0 %, and for drawings in U.S. dollars, the interest rate equals SOFR plus 3.3 %. The trade finance facility was originally secured by a standby documentary credit for $ 1.0 million from UBS Switzerland AG and a personal guarantee to the value of $ 4.0 million from the Chairman of our board of directors, Max Gottschalk, and a $ 3,150 corporate guarantee from Perfect Moment (UK) Limited. The UBS standby documentary credit expired on April 30, 2023 and the facility was then secured by charge over cash deposits equal to the amount of the facility used at any given moment in time in addition to the aforementioned personal and corporate guarantees. On May 31, 2023, the UBS standby documentary credit was reinstated for $ 1.0 million, which standby documentary credit was secured by a guarantee from Joachim Gottschalk & Associates, Ltd. (“JGA”). The UBS standby documentary credit was extended on November 26, 2023 through January 26, 2024 at a 10% interest rate. The JGA guarantee is in addition to the $ 4.0 million personal guarantee of the trade finance facility by Mr. Gottschalk. The UBS standby documentary credit was not extended and the $ 3,150 corporate guarantee from Perfect Moment (UK) Limited was replaced with a $ 2,000 corporate guarantee from Perfect Moment, Limited. The JGA guarantee accrued interest between 8 % and 10 % per annum, payable by the Company. The Company utilized $ 1,847 of borrowings under the facility, all of which was repaid by March 31, 2024. The trade finance facility is also secured by a guarantee by Perfect Moment Ltd. in the amount of $ 2.0 million. The interest paid on the JGA personal guarantee for the years ended March 31, 2024 and 2023 was $ 56 and $ 33 , respectively. F- 17 9. CONVERTIBLE DEBT OBLIGATIONS SCHEDULE OF CONVERTIBLE DEBT OBLIGATIONS December 31, 2023 March 31, 2023 $’000 $’000 Convertible debt $ - $ 11,262 Unamortized debt discount - ( 492 ) Total Convertible debt obligations $ - $ 10,770 In March 2021, the Company entered into an arrangement whereby the Company completed convertible debt financing (“2021 Debt Financing”), from 47 investors, for gross proceeds of $ 6,000 , less $ 841 of debt issuance costs, at an 8 % interest rate to provide working capital for its operations. Between April and July 2022, the Company received further convertible debt financing (“2022 Debt Financing”) from 47 investors with gross proceeds of $ 4,000 , less $ 531 of debt issuance costs, that rank pari passu to the 2021 Debt Financing at an 8 % interest rate. The debt issuance costs were amortized over the life of the convertible debt. The Company’s convertible debt obligations are secured by a security interest over the assets of Perfect Moment Ltd. and its subsidiaries. The 2021 Debt Financing had a maturity date of December 15, 2023. In December 2023 and January 2024, the maturity date of all convertible promissory notes was extended to February 14, 2024. Upon the closing of an IPO, prior to the redemption date, the convertible debt was convertible into the Company’s common stock at a conversion price equal to 80 % of the public offering price of the Company’s common stock in the IPO. The 2021 Debt Financing had a maturity date of December 15, 2023 . In December 2023 and January 2024, the maturity date of all convertible promissory notes was extended to February 14, 2024 . As of March 31, 2023, the convertible debt obligations comprised gross proceeds of 10,002 and accrued interest of $ 1,260 . On February 12, 2024, $ 10,002 in principal amount plus accrued interest in the amount of $ 1,985 automatically converted into the Company’s common stock, at 80 % of the initial public offering price into an aggregate of 2,497,267 shares of common stock (see note 10). The unamortized debt discount is the related arrangement fees that are being amortized against the convertible debt obligations on the consolidated balance sheets. As of March 31, 2023, the balance of unamortized debt discount was $ 492 . Upon closing of the IPO in February 2024, the unamortized balance of debt discount of $ 492 was charged to interest expense. 10. COMMON STOCK Common stock The following were Common Stock transactions during the year ended March 31, 2024: Sale of common stock from private placement During May to August 2023, the Company issued 409,050 shares of common stock at a par value of $ 0.0001 and a purchase price of $ 6.00 per share. The total net proceeds were $ 2,179 , net of broker fees and expenses. The holders of the common stock shall be entitled to cast one vote for each share held at all stockholder meetings and have no right to subscribe to or purchase any new or additional issue of shares. F- 18 Shares and Warrants Issued as Part of the Company’s Underwritten Public Offering On February 7, 2024, the company entered into an underwriting agreement with ThinkEquity LLC, as representative (the “Representative”) of the several underwriters identified therein, relating to the Company’s initial public offering (the “IPO”) of 1,334,000 shares of the Company’s common stock, par value $ 0.0001 per share. The Company previously filed the form of underwriting agreement as an exhibit to the Company’s registration statement on Form S-1, as amended from time to time (File No. 333-274913), which was declared effective by the Securities and Exchange Commission on February 7, 2024. The price per share to the public was $ 6.00 generating gross proceeds of $ 8,004 . The Company also granted the Underwriters a 45-day option to purchase up to 200,100 additional shares of Common Stock on the same terms and conditions for the purpose of covering any over-allotments in connection with the IPO. The number of shares of common stock outstanding after this offering was 15,578,449 as of February 7, 2024, that included the previously issued and outstanding of 5,233,402 , the 1,334,000 shares issued as part of this offering plus (i) the automatic conversion of all outstanding shares of our Series A convertible preferred stock into 5,323,782 shares of common stock, (ii) the automatic conversion of all outstanding shares of our Series B convertible preferred stock into 1,189,998 shares of common stock and (iii) the automatic conversion, in connection with the closing of this offering (closing on February 12, 2024), of $10,002 in principal amount plus accrued interest in the amount of $1,985 under our 8% senior subordinated secured convertible promissory notes (the “2021 Notes”) and our 8% senior subordinated secured convertible promissory notes (the “2022 Notes” and, together with the 2021 Notes, the “Notes”), at 80% of the initial public offering price into an aggregate of 2,497,267 shares of common stock. On February 12, 2024, the Company consummated the IPO and issued 1,334,000 shares of Common Stock for aggregate net proceeds of approximately $ 6,009 , after deducting underwriting discounts and commissions and estimated offering expenses. The Company intends to use the proceeds for general corporate purposes, including working capital, sales and marketing activities and general and administrative matters. Concurrently with the closing of the IPO, the Company also issued warrants to purchase up to 66,700 shares of Common Stock to the Representative and its designees, at an exercise price of $ 7.50 per share (the “Underwriter Warrants”). The Underwriter Warrants are exercisable beginning on August 5, 2024, and expire on February 7, 2029 . The following were Common Stock transactions during the year ended March 31, 2023: Shares issued for services During 2021, the Company engaged several consultants to provide services relating to the IPO who were compensated with common stock awards. The shares subject to clawback provisions remain unvested until the related performance condition is met. If clawback features are triggered, the unvested shares will be returned to the Company. In January and March 2021, 2,000,000 shares of common stock with a total fair value of $ 7,000 were issued to certain non-employees in exchange for consulting and advisory services to be performed relating to the 2021 share exchange and the 2021 convertible debt financing, of which 50% were subject to clawback contingent upon an IPO. As services were relating to, and contingent upon execution of an IPO, no expense was recognized for the shares subject to clawback, until occurrence of an IPO. During the year ending March 31, 2023, the consultants performed additional services and the Company agreed to remove the clawback provision and the $ 3,500 fair value for the remaining 1,000,000 shares of common stock was recognized within selling, general and administrative expenses in the consolidated statements of operations and comprehensive loss during the year ending March 31, 2023. No further shares were issuable under these agreements. F- 19 In October 2021, 75,000 shares of common stock with a total fair value of $ 295 were issued to a consultant in exchange for legal services to be performed relating to an IPO subject to a 100% clawback provision in the event that an IPO is not achieved. As services were relating to and contingent upon execution of an IPO, no expense was recognized until occurrence of an IPO. During the nine months ended December 31, 2022, the Company entered into an agreement to remove the clawback provision and the fair value of $ 295 was recognized within selling, general and administrative expenses in the consolidated statements of operations and comprehensive loss during the three months then ended. As of December 31, 2023 and March 31, 2023, no further shares were issuable under this agreement. In relation to the above consulting and advisory services, the Company had granted rights to six holders of our common stock, to be issued additional shares of our common stock if the IPO price per share was less than $ 5.00 , as adjusted for any stock split or combination prior to the IPO, or if we sold our equity securities before the closing of the IPO at the purchase price per share or conversion price per share that is less than $ 5.00 , as adjusted for any stock split or combination prior to the IPO. Since the IPO price was greater than $ 5.00 , this provision was not triggered. The Company issued a total 1,075,000 and charged APIC $ 3,795 related to services rendered during the year ended March 31, 2023. 11. PREFERRED STOCK Series A Preferred Stock On March 15, 2021, PMA, the former parent entity, engaged in a share for share exchange with the Company, thereby creating the Company as the ultimate parent company. As part of the share for share exchange, existing PMA stockholders’ equity was exchanged for an equivalent amount of share capital in the Company in the form of common stock and preferred stock. As a result of the transaction, 5,323,782 shares of Series A Convertible Preferred Stock (“Series A Stock”) with a $ 0.0001 par value were issued to existing PMA shareholders for nil consideration. The Series A Stock could be voluntarily converted into shares of common stock at the request of the Series A stockholder by providing written notice. The Series A Stock was also subject to mandatory conversion into common stock upon either an IPO or by vote or written consent of at least 66 2/3% holders of the outstanding shares of the Series A Stock. The conversion was at a rate of one share of Series A Stock for one share of common stock without payment of additional consideration. The holders of Series A Stock were entitled to receive dividends as if the conversion to common stock had taken place, if and when dividends are declared. Such dividends take preference to dividends paid on shares of common stock and are non-cumulative. The holders of the Series A Stock were entitled to vote based on the equal number of whole shares of common stock into which the shares of Series A Stock are convertible as of the date of the vote. The Series A Stock with respect to dividend rights and rights upon liquidation, dissolution or winding up of the Company or deemed liquidation event ranked senior to both the common stock and any other class of stock which specifically ranks junior to the Series A Stock. On February 12, 2024, all outstanding shares of our Series A convertible preferred stock were automatically converted into 5,323,782 shares of common stock in connection with the closing of the initial public offering Series B Preferred Stock On September 23, 2022, the Company authorized the issuance and sale of up to 1,200,000 shares of Series B Convertible Preferred Stock (“Series B Stock”), with a par value of $ 0.0001 per share and a purchase price of $ 5.00 per share. A total of 1,189,998 shares of Series B Stock was issued between September 2022 and November 2022, for net proceeds of $ 5,200 , net of broker fees of $ 750 . The Series B Stock could be voluntarily converted into shares of common stock at the request of the Series B stockholder by providing written notice. The Series B Stock was also subject to mandatory conversion into common stock upon either an IPO or by vote or written consent of at least 66 2/3% holders of the outstanding shares of the Series B Stock without payment of additional consideration. The conversion was determined by dividing the original issue price by the conversion price in effect at the time of conversion. The initial conversion price was set at $ 5.00 per share. The holders of Series B Stock were entitled to receive dividends as if the conversion to common stock had taken place, if and when dividends are declared. Such dividends took preference to dividends paid on shares of common stock and are non-cumulative. The holders of the Series B Stock were entitled to vote based on the equal number of whole shares of common stock into which the shares of Series B Stock were convertible as of the date of the vote. The Series B Stock, with respect to dividend rights and rights upon liquidation, dissolution or winding up of the Company or deemed liquidation event, ranked pari passu with the Series A Stock. On February 12, 2024, all outstanding shares of our Series B convertible preferred stock were automatically converted into 1,189,998 shares of common stock in connection with the closing of the initial public offering (see note 11). F- 20 12. RESTRICTED STOCK UNITS Restricted Stock Units A summary of restricted stock unit activity for the years ended March 31, 2024 and 2023 are presented below. SCHEDULE OF RESTRICTED STOCK UNIT ACTIVITY Weighted- Average Grant Date Shares Fair Value Fair Value Non-vested at March 31, 2023 - $ - $ - Granted 300,000 1,230 4.10 Vested/deemed vested ( 75,000 ) ( 429 ) 4.10 Forfeited - - - Non-vested at March 31, 2024 225,000 $ 801 $ 4.10 During the year ended March 31, 2024, the Company granted 300,000 shares of its restricted stock to an employee. The Restricted Stock Units vest equally over four years, starting on the contractual start date of November 7, 2022. These Restricted Stock Units were valued based on market value of the Company’s stock price at the respective date of grant and had aggregate fair value of $ 1,230,000 , which is being amortized as stock compensation expense over its vesting term. During the year ended March 31, 2024, 75,000 shares with a fair value of $ 429 vested during the period. F- 21 13. STOCK OPTIONS The Company maintains the 2021 Equity Incentive Plan (the “2021 Plan”), which provides for the grant of incentive stock options, non-statutory stock options, stock appreciation rights, restricted stock awards, restricted stock units and performance units and performance shares to employees, directors and consultants of the Company or any parent or subsidiary of the Company. The purpose of the 2021 Plan is to enable the Company to attract and retain the best available personnel for positions of substantial responsibility, to provide additional incentive to employees, directors and consultants of the Company or any parent or subsidiary of the Company, and to promote the success of the Company’s business. The Company has 2,527,944 shares available to issue from the 2021 plan as of March 31, 2024. The Company has historically granted stock options to non-employees in exchange for the provision of services, both under the 2021 Plan and outside of the 2021 Plan. A summary of option activity for the years ended March 31, 2024 and 2023 are presented below: SCHEDULE OF STOCK OPTION ACTIVITY Weighted- Weighted- Average Average Remaining Aggregate Exercise Contractual Intrinsic Options Price Life (Years) Value Outstanding at March 31, 2022 545,378 $ 1.32 3.2 $ 1,190 Granted 136,344 0.01 - - Forfeited ( 381,766 ) ( 0.63 ) - - Exercised - - - - Outstanding at March 31, 2023 299,956 1.60 1.94 1,320 Granted 808,400 4.10 - - Forfeited - - - - Exercised - - - - Outstanding at March 31, 2024 1,108,356 $ 3.42 3.42 $ 595 Vested March 31, 2024 387,784 $ 2.19 $ 594 Exercisable at March 31, 2024 366,898 $ 2.08 $ 594 During the year ended March 31, 2023, the Company granted stock options to an employee to purchase 136,344 shares of Common Stock for services rendered. The options have an exercise price of $ 0.01 per share, expire in five years , vesting 20% on July 1, 2022 and then equally over four years from July 1, 2022. The total fair value of these options at grant date was approximately $ 200 using a third-party valuation. During the year ended March 31, 2024, the Company granted stock options to employees and the Board of Directors to purchase a total 808,400 shares of Common Stock for services rendered. The options have an exercise price of $ 4.10 per share, expire between five and ten years , vesting equally over four years from various dates. The total fair value of these options at grant date was approximately $ 3,039 using the Black-Scholes Option Pricing model. The total stock compensation expense recognized related to vesting of stock options for the years ended March 31, 2024 and March 31, 2023 amounted to $ 310 and $ 241 , respectively. As of March 31, 2024 the total unrecognized stock-based compensation was $ 2,527 , which is expected to be recognized as part of operating expense through January 2028. At March 31, 2024, the intrinsic value of the outstanding options under the 2021 Plan was $ 595 . The fair value of the share option awards was estimated using the Black-Scholes method and probability-weighted expected return method (PWERM) based on the following weighted-average assumptions: SCHEDULE OF FAIR VALUE OF SHARE OPTION AWARDS Year Ended Year Ended March 31, 2024 March 31, 2023 Expected life in years 5.0 and 10.0 3.5 Stock price volatility 129.1 % 40 %- 45 % Risk free interest rate 1.74 - 1.81 % 0.37 %- 0.49 % Expected dividends 0 % 0 % Forfeiture rate 25.7 % 0 % 14. STOCK WARRANTS A summary of warrant activity for the years ended March 31, 2024 and 2023 are presented below: SCHEDULE OF WARRANTS ACTIVITY Weighted- Weighted- Average Average Remaining Aggregate Exercise Contractual Intrinsic Options Price Life (Years) Value Outstanding at March 31, 2023 - - - - Granted 66,700 7.50 - - Forfeited - - - - Exercised - - - - Outstanding at March 31, 2024, all vested 66,700 $ 7.50 4.87 $ - F- 22 On February 12, 2024, the Company granted warrants to purchase a total of 66,700 shares of Common Stock as part of a public offering, which remain outstanding as of March 31, 2024. The warrants are exercisable at an average price of $ 7.50 per share and will expire on February 12, 2029. See Note 11, Common Stock, for additional information. As of March 31, 2024 the outstanding warrants had no intrinsic value. 15. INCOME TAXES Income tax (benefit) expense Components of income tax (benefit) expense were as follows: SCHEDULE OF INCOME TAX BENEFIT EXPENSE March 31, 2024 March 31, 2023 Years Ended March 31, 2024 March 31, 2023 $’000 $’000 Current $ - $ ( 121 ) Deferred - - Total income tax (benefit) expense $ - $ ( 121 ) Reconciliation The reconciliation of income taxes computed at the U.S. federal statutory tax rate to our income tax (benefit) expense is as follows: SCHEDULE OF RECONCILIATION OF INCOME TAXES March 31, 2024 March 31, 2023 $’000 $’000 Loss before income tax at 21 % rate $ ( 1,831 ) $ ( 2,189 ) Change in valuation allowance 1,211 2,097 Foreign tax differential 102 55 Other permanent items 518 37 R&D tax credit - ( 121 ) Income tax (benefit) expense $ - $ ( 121 ) The Company’s effective tax rate for the years ended March 31, 2024 and 2023 differed from the applicable federal statutory rate of 21.0 % primarily due to the impact of the valuation allowance on the Company’s deferred tax assets, as disclosed below. F- 23 Deferred tax assets and liabilities Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of our deferred tax assets and liabilities were as follows: SCHEDULE OF DEFERRED TAX ASSETS AND LIABILITIES March 31, 2024 March 31, 2023 $’000 $’000 Deferred tax liabilities: Fixed and intangible assets $ 113 $ 101 Inventory - - Total deferred tax liabilities 113 101 Deferred tax assets: Tax loss carryforward 7,312 6,352 Stock compensation expense 535 197 IPO expenses 163 - Valuation allowance ( 7,897 ) ( 6,448 ) Total deferred tax assets 113 101 Deferred tax assets, net $ - $ - Income tax payments and refunds During the year ended March 31, 2023, the Company received a tax repayment of $ 121 , in respect to research and development tax credits. During the years ended March 31, 2024 and 2023, the Company did not make any income tax payments. Valuation allowance During the years ended March 31, 2024 and 2023, the Company recorded an increase in the valuation allowance of $ 1,449 and $ 1,935 , respectively, related to federal deferred tax assets. Deferred tax assets are recorded related to net operating losses and temporary differences between the book and tax bases of assets and liabilities expected to produce tax deductions in future periods. The realization of these assets depends on recognition of sufficient future taxable income in specific tax jurisdictions in which those temporary differences or net operating losses are deductible. In assessing the need for a valuation allowance on deferred tax assets, we consider whether it is more likely than not that some portion or all of them will not be realized. Throughout the year ended March 31, 2024, the Company has been assessing the realizability of its deferred tax assets by considering positive factors such as the next three years’ profit projection making it more likely than not that the Company will be able to recognize a deferred tax asset on losses. Based upon historical performance of the Company, a valuation allowance of 100 % was recorded as there is currently no significant evidence to indicate realizability of deferred tax assets. During 2024, the Company recorded a valuation allowance of 100 % of UK and Hong Kong losses. As of March 31, 2024 and 2023, the Company’s valuation allowance was $ 7,897 and $ 6,448 , respectively. 16. FOREIGN CURRENCY TRANSLATION We report all currency amounts in USD. The Company’s subsidiaries in UK, Hong Kong and Switzerland maintain their books and records in their functional currencies, which are GBP, HKD and CHF, respectively. When consolidating the subsidiaries with non-USD functional currencies, we translate the amounts of assets and liabilities into USD using the exchange rate on the balance sheet date, and the amounts of revenue and expense are translated at the average exchange rate prevailing during the period. The gains and losses resulting from translation of financial statement amounts into USD are recorded as a separate component of accumulated other comprehensive loss within Stockholders’ equity (deficit). F- 24 We used the exchange rates in the following table to translate amounts denominated in non-USD currencies as of and for the periods noted: SCHEDULE OF FOREIGN CURRENCY TRANSLATION Year end exchange rate: March 31, 2024 March 31, 2023 GBP:USD 1.26254 1.23682 HKD:USD 0.12778 0.12739 CHF:USD 1.10871 1.09521 Year end exchange rate 1.10871 1.09521 Average exchange rate: March 31, 2024 March 31, 2023 Years Ended Average exchange rate: March 31, 2024 March 31, 2023 GBP:USD 1.27055 1.20549 HKD:USD 0.12782 0.12756 CHF:USD 1.12514 1.04924 A verage exchange rate 1.12514 1.04924 The following table, reported in USD, disaggregates our cash balances by currency denomination: SCHEDULE OF CASH BALANCES BY CURRENCY DENOMINATION Cash denominated in: March 31, 2024 March 31, 2023 $’000 $’000 USD $ 7,187 $ 3,325 GBP 598 447 HKD 27 21 CHF 14 18 EUR 84 895 CNY - 6 Cash $ 7,910 $ 4,712 Our cash primarily consists of funds held in bank accounts and third party payment platforms. SCHEDULE OF FUNDS HELD IN BANK AND THIRD PARTY PAYMENT PLATFORMS Cash held by Chase $ 6,180 $ - Cash held by HSBC 1,637 4,405 Cash held by other banks 45 66 Cash held by third party payment platforms 46 239 Petty cash 2 2 Total Cash $ 7,910 $ 4,712 The Company maintains the majority of cash at HSBC where the balances are insured by the Federal Deposit Insurance Corporation (FDIC) up to $ 250,000 . At times, the cash balances may exceed the FDIC-insured limit. As of March 31, 2024, we do not believe we have any significant concentrations of credit risk due to the strong credit rating of HSBC and the cash balance is expected to be utilized within 6 months to fund working capital requirements. The cash held by other banks is within the FDIC insured amount and cash held by third party payment platforms are short term timing balances. 17. COMMITMENTS AND CONTINGENCIES Legal proceedings - The Company is, from time to time, involved in routine legal matters, and audits and inspections by governmental agencies and other third parties which are incidental to the conduct of its business. This includes legal matters such as initiation and defense of proceedings to protect intellectual property rights, liability claims, employment claims, and similar matters. The Company believes the ultimate resolution of any such legal proceedings, audits, and inspections will not have a material adverse effect on its consolidated balance sheets, results of operations or cash flows. F- 25 On December 20, 2023, Aspen Skiing Company, LLC filed a complaint against the Company in the United States District Court for the District of Colorado, alleging, among other things, trademark infringement, false association, false endorsement, unfair competition and deceptive trade practices by the Company. Management has determined, after the advice of legal counsel, that the claims and actions related to such complaint are not expected to have a material adverse effect on our financial condition because management believes that the lawsuit will not succeed on the merits and the risk of any material loss is remote. The claims relate to the Company’s social media posts of models and influencers in ski gondolas on the mountain owned by Aspen Skiing Company and now discontinued limited edition clothing sold by the Company that included images, which were licensed by the Company from a photographer, of a skier’s rest area in Aspen that Aspen Skiing Company calls the “AspenX Beach Club.” The complaint seeks injunctive relief, but no motion for injunctive relief has been filed in the suit. The complaint also seeks delivery of all infringing material to Aspen Skiing Company and an award of the Company’s profits and Aspen Skiing Company’s damages in an amount to be determined at trial, costs incurred by Aspen Skiing Company in the action, their attorney’s fees and treble damages. Although the results of such litigation matters and claims cannot be predicted with certainty, we believe that the final outcome of such ordinary, routine litigation will not have a material adverse impact on our financial position, liquidity, or results of operations. Capital commitments - The Company had no purchase obligations as of March 31, 2024, related to purchase orders to factories for the manufacture of finished goods. All future obligations are to be financed by HSBC letters of credit and comprise the balance held as restricted cash on the consolidated balance sheets. 18. RELATED PARTY TRANSACTIONS Consulting Agreements with Directors Certain directors of the Company and its subsidiaries, provided consulting and advisory services for the Company which are included in the selling, general and administrative expenses in the accompanying consolidated statement of operations for the years then ended. As of March 31, 2024 and 2023, $ 0 and $ 22 was unpaid, respectively, which was included in accrued expenses as of the years then ended. Below are the directors of the Company that provided the consulting and advisory services: SCHEDULE OF DIRECTORS COMPANY SUBSIDIARIES March 31, 2024 March 31, 2023 Years Ended March 31, 2024 March 31, 2023 $’000 $’000 (A) Max Gottschalk (director of the Company) 181 135 (B) Jane Gottschalk (director of the Company) - 48 (C) Tracy Barwin (director of the Company) 121 89 (D) Andreas Keijsers (director of a subsidiary) 22 48 Expenses for Related Parties 324 320 (A) We, through PMA, are party to a consulting agreement with Max Gottschalk, dated May 15, 2019, which continues until terminated in accordance with its terms, during which Mr. Gottschalk is entitled to receive fees for services rendered amounting to £ 8,000 per month from April 2021 to November 2022 and £ 12,000 per month since December 2022. These amounts are in lieu of any other cash payments or equity awards Mr. Gottschalk may otherwise have been entitled to receive as a member of our board of directors. (B) We, through PMA, were party to a consulting agreement with Jane Gottschalk, dated April 30, 2018, pursuant to which Ms. Gottschalk was entitled to receive £ 8,000 per month since April 1, 2019, for services rendered. These amounts are in lieu of any other cash payments or equity awards Ms. Gottschalk may otherwise have been entitled to receive as a member of our board of directors. The consulting agreement was terminated effective September 1, 2022, after which Ms. Gottschalk became an employee of PMUK. (C) We were party to a consulting agreement with Tracy Barwin, dated November 18, 2022, pursuant to which Ms. Barwin was entitled to receive £ 1,500 per day for services rendered with a minimum commitment of two days per month. These amounts were in lieu of any other cash payments or equity awards Ms. Barwin may otherwise have been entitled to receive as a member of our board of directors. The consulting agreement with Ms. Barwin was terminated in October 2023 and replaced by an independent director agreement. (D) We, through PMA, were party to a consulting agreement with Arnhem Consulting Limited (“Arnhem”), a company controlled by Andre Keijsers, dated February 28, 2017, pursuant to which Arnhem was entitled to receive £ 1,200 per month for services rendered. The consulting agreement was terminated in September 2023 as a result of Mr. Keijsers becoming a director of the Company. F- 26 Other The Company has engaged Deliberate Software Limited (“Deliberate”) as a supplier for IT services amounting to $ 383 and $ 321 for the years ended March 31, 2024 and 2023, respectively, recognized within selling, general and administrative expenses. As of March 31, 2024 and 2023, $ 90 and $ 14 were unpaid and included in trade payables, respectively. A director of Deliberate is an immediate family member of Negin Yeganegy, the former Chief Executive Officer and director of PML during the year ended March 31, 2023. As of March 31, 2023, Deliberate held 100,351 shares of Series A preferred stock which were converted into 100,351 shares of common stock in connection with the closing of the initial public offering on February 12, 2024. On June 29, 2022, the Company entered into a short-term loan of $ 202 from Sprk Capital Limited at an interest rate of 16 % that was repayable by December 31, 2022. The principal loan plus interest was repaid in February 2023. Interest expense during the year ended March 31, 2023 was $ 22 . A director of Sprk Capital Limited, Simon Nicholas Champ, is a shareholder of the Company. As of March 31, 2023, Simon Nicholas Champ held 19,570 shares of Series A preferred stock which were converted into 19,570 shares of common stock in connection with the closing of the initial public offering on February 12, 2024. On June 26, 2023, our HSBC trade finance facility became secured by a standby documentary credit for $ 1,000 from UBS Switzerland AG, which standby documentary credit is secured by a guarantee from JGA. The JGA guarantee accrues interest of 8 % per annum, payable by the Company. The UBS standby documentary credit expired on November 26, 2023 and was renewed through January 26, 2024. Upon renewal, the interest accrual increased to 10 % per annum. The interest charged for the year ended March 31, 2024 was $ 56 . Such JGA guarantee is in addition to the $ 4,000 personal guarantee of the trade finance facility by Mr. Gottschalk, described below. The Chairman of our board of directors, Max Gottschalk, has provided a $ 4,000 personal guarantee for all monies, obligations and liabilities owing by PMA to HSBC, the Company’s principal banking facility provider. The guarantee is a pay-on-demand guarantee securing the Company’s obligations under the HSBC facility, including interest and bank costs, fees and expenses, up to $ 4,000 . 19. SUBSEQUENT EVENTS Employee Stock Plans On June 18, 2024, the Company granted stock options to employees to purchase a total of 508,194 shares of Common Stock for services rendered and to be rendered. The options have an exercise price of $ 2.40 per share, expire in ten years, vesting in equal installments over four years from grant date, employment date, or the date the award was originally approved, but not granted. All the options were approved previously, but not issued to ensure compliance with UK statutory law. Our board re-approved the grants on June 18, 2024. F- 27 INDEX TO EXHIBITS The exhibits listed below are filed as part of this Quarterly Report on Form 10-Q, or are incorporated herein by reference, in each case as indicated below. Exhibit Incorporated by Reference Number Description Form File No. Exhibit Filing Date 1.1 Underwriting Agreement, dated February 7, 2024, by and between the Company and ThinkEquity LLC 8-K 001-41930 1.1 February 13, 2024 3.1 Amended and Restated Certificate of Incorporation of the Company 8-K 001-41930 3.1 February 13, 2024 3.2 Amended and Restated Bylaws of the Company 8-K 001-41930 3.2 February 13, 2024 4.1 Form of the Company’s Common Stock Certificate S-1 333-274913 4.1 November 6, 2023 4.2 Form of Underwriter Warrants S-1 333-274913 4.2 January 22, 2024 10.1+ Employment Agreement between Perfect Moment Ltd. and Jeff Clayborne S-1 333-274913 10.2 November 6, 2023 10.2+ Amendment No. 1 to Employment Agreement between Perfect Moment Ltd. and Jeff Clayborne S-1 333-274913 10.3 January 22, 2024 10.3+ Independent Director Agreement between Perfect Moment Ltd. and Andre Keijsers S-1 333-274913 10.20 January 18, 2024 10.4+ Independent Director Agreement between Perfect Moment Ltd. and Berndt Hauptkorn S-1 333-274913 10.21 January 18, 2024 10.5+ Independent Director Agreement between Perfect Moment Ltd. and Tracy Barwin S-1 333-274913 10.22 January 18, 2024 10.6+ Form of Indemnification Agreement for Directors and Officers S-1 333-274913 10.21 November 6, 2023 10.7 Guarantee Agreement between Perfect Moment Asia Limited and J. Gottschalk & Associates S-1 333-274913 10.37 November 6, 2023 10.8 Amendment to UBS Switzerland AG Standby Documentary Credit S-1 333-274913 10.40 December 1, 2023 23.1 Consent of Weinberg & Company, P.A. 31.1 Certification of the Principal Executive Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 31.2 Certification of the Principal Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 32.1* Certifications of the Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 32.2** Certifications 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 97.1* Perfect Moment Ltd. Clawback Policy 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 Calculation Linkbase Document 101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document 101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document 101.LAB Inline XBRL Taxonomy Extension Labels 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) + Indicates a management contract or compensatory plan or arrangement. * Filed herewith ** Furnished herewith. 77 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this annual report on Form 10-K to be signed on its behalf by the undersigned thereunto duly authorized. PERFECT MOMENT LTD. Date: July 1, 2024 By: /s/ Mark Buckley Mark Buckley Chief Executive Officer, Director (Principal Executive Officer) Date: July 1, 2024 By: /s/ Jeff Clayborne Jeff Clayborne Chief Financial Officer (Principal Financial and Accounting Officer) Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. Date: July 1, 2024 By: /s/ Mark Buckley Mark Buckley Chief Executive Officer, Director (Principal Executive Officer) Date: July 1, 2024 By: /s/ Jeff Clayborne Jeff Clayborne Chief Financial Officer (Principal Financial and Accounting Officer) Date: July 1, 2024 By: /s/ Andre Keijsers Andre Keijsers Director Date: July 1, 2024 By: /s/ Berndt Hauptkorn Berndt Hauptkorn Director Date: July 1, 2024 By: /s/ Jane Gottschalk Jane Gottschalk Director Date: July 1, 2024 By: /s/ Matt Gottschalk Jane Gottschalk Director Date: July 1, 2024 By: /s/ Tracy Barwin Tracy Barwin Director Date: July 1, 2024 By: /s/ Tim Nixdorff Tim Nixdorff Director 78