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, 2025. Management’s Report on Internal Controls Over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is a process designed under the supervision of our principal executive and principal financial officers to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate due to changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Under the supervision and with the participation of our management, including our principal executive and principal financial officers, we conducted an evaluation of the effectiveness of our internal control over financial reporting as of March 31, 2025. Based on this evaluation, our management concluded that our internal control over financial reporting was effective as of March 31, 2025. 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, 2025 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. 40 ITEM 9B. OTHER INFORMATION Insider Trading Arrangements During the three months ended March 31, 2025, 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 Off icers Chath Weerasinghe 44 Chief Financial and Operating Officer Jane Gottschalk 52 President, Chief Creative Officer and Director Mark Buckley 43 Former Chief Executive Officer and Director Jeff Clayborn 54 Former Chief Financial Officer Non-Executive Directors Max Gottschalk 53 Chairman of the Board of Directors Andre Keijsers 59 Director Berndt Hauptkorn 57 Director Tracy Barwin 46 Director Tim Nixdorff 40 Director Adam Epstein 46 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. 41 Executive Officers Chath Weerasinghe– Chief Financial Officer Mr. Weerasinghe has served as our Chief Financial Officer since February 2025. He brings over a decade of senior finance and operations experience in the retail and apparel sector. Prior to joining the Company, he spent four years at Canada Goose, where he served as Senior Director of Finance & Services (2021–2022) and later as Vice President of Finance & Operations (2022–2024). From 2017 to 2021, he was Group Head of Finance and IT at MUJI Europe Holdings Limited, and previously held the role of European Finance and Accounting Manager at American Apparel (2011–2016). Mr. Weerasinghe holds a B.A. in Applied Accounting from Oxford Brookes University and an MBA from the University of East London. He completed the INSEAD Chief Operating Officer Executive Education Program in 2024 and is a Fellow of the Association of Chartered Certified Accountants (FCCA). Jeff Clayborne– Former Chief Financial Officer Mr. Clayborne served as our Chief Financial Officer from October 2023 to January 2025. During his tenure, he contributed to our financial operations and planning during a key transition period. He is also a financial advisor at Healthy Extracts Inc. and previously held CFO roles at SONDORS, Inc. (2022–2023), where he led the company’s Nasdaq readiness and operational improvements, and at Verb Technology Company, Inc. (Nasdaq: VERB, VERBW) (2016–2022), where he supported its uplisting to Nasdaq and oversaw multiple financings. Earlier in his career, he held senior finance roles at Universal Music Group and The Walt Disney Company and began his career as a CPA with McGladrey & Pullen LLP and KPMG. Mr. Clayborne holds an MBA from the University of Southern California. Jane Gottschalk – Chief Creative Officer and Director Ms. Gottschalk has served as our Chief Creative Officer since September 2022, a member of our board of directors since March 2021, and was appointed President of the Company in February 2025. She has been deeply involved in the creative and brand direction of Perfect Moment for over a decade, including her roles as Creative Director of PMUK (2017–2022) and PMA (2012–2022), and now as Chief Creative Officer of both entities. Ms. Gottschalk has played a pivotal role in shaping the brand’s visual identity, product design, and market positioning across global markets. She is also a director of Jing Holdings Limited, the holding company for Jax Coco, a premium coconut water brand, and served on the board of Jax Coco UK Limited until May 2023. Ms. Gottschalk holds a B.A. from the University of Kent. She is the wife of Max Gottschalk, the Chairman of our board of directors. We believe Ms. Gottschalk is well-qualified to serve on our board given her deep understanding of the brand, creative leadership, and entrepreneurial vision, which continue to drive the Company’s unique positioning and cultural identity. Mark Buckley – Former Chief Executive Officer and Director Mr. Buckley served as our Chief Executive Officer from November 2022 until January 2025 and has been a member of our board of directors since November 2022. He also served as acting Chief Financial Officer until October 2023. In addition, Mr. Buckley is a director at 3rd Rock Private Limited. Prior to joining the Company, he was CFO of Rapha Racing Limited (2020–2022) and held senior finance roles there and at Burberry Limited (2011–2016), including Director of Financial Planning & Analysis. He began his career at Marks and Spencer Group plc, which included an international secondment to Woolworths South Africa. Mr. Buckley is a qualified accountant (ACCA, 2004). We believe he is qualified to serve on our board due to his extensive leadership and financial experience. Mr. Buckley was terminated as Chief Executive Officer on January 31, 2025, but remains a director of the Company as of March 31, 2025. 42 Non-Executive Directors Max Gottschalk – Chairman of the Board of Directors Mr. Gottschalk has served as Chairman of our board of directors since March 2021, and has also served on the boards of PMA since 2012 and PMUK since 2017. He is the Founder and CEO of Vedra Partners Ltd., a London- and Switzerland-based multi-family office, and has extensive experience leading and advising investment entities across private equity, sustainable finance, and consumer goods. He is a Partner at Ocean 14 Capital Ltd., a fund focused on ocean sustainability, and holds director roles at Nurture Brands Ltd., Aeon Investment Ltd., and several holding entities of the Hycap Fund, an energy transition-focused private equity vehicle. Mr. Gottschalk previously co-founded Gottex Fund Management, a global asset management firm which he built and successfully listed on the Swiss stock exchange. Earlier in his career, he held senior roles at Bear Stearns in New York, leading fixed income hedge fund sales. Mr. Gottschalk holds a B.A. in Finance from the McIntire School of Commerce at the University of Virginia. We believe he is well-qualified to serve as Chairman due to his significant board experience, entrepreneurial track record, and broad expertise in investment management and strategic leadership. Andre Keijsers – Director Mr. Keijsers has served on our board since October 2023 and has held directorships at PMA, PMUK, and various affiliated entities since 2016. He is CEO of Van Lanschot Kempen Investment Management (UK) Ltd. and previously held executive roles at Vedra Partners, Gottex Fund Management, and Swapstream. He founded Arnhem Consulting and serves on multiple boards. Mr. Keijsers holds a doctorandus degree in Computer Science from Radboud University. We believe he is qualified to serve on our board given his governance, finance, and investment experience. Berndt Hauptkorn – Director Mr. Hauptkorn has served on our board since October 2023. He is President, Europe Region, and Global Markets Officer at Chanel, overseeing operations across EMEA and coordinating global leadership. Previously, he was CEO at Uniqlo Europe and Bally International, and a Principal at BCG. He holds a Diplom-Kaufmann and Dr. rer. pol. in Business Administration from Friedrich-Alexander-University. We believe his global fashion industry expertise and leadership experience make him a valuable board member. Tracy Barwin – Director Ms. Barwin has served on our board since November 2022. She is the Founder of Tracy B Ltd. and previously held senior roles at Hunter Boot, Uniqlo, and Myla, with a focus on direct-to-consumer and customer experience. Ms. Barwin holds a B.A. in Modern History and Politics from Manchester University and a postgraduate diploma from The Chartered Institute of Marketing. We believe she is qualified to serve on our board due to her experience in fashion, retail, and DTC operations. Tim Nixdorff – Director Mr. Nixdorff joined our board in January 2024. He is CEO of GORE Technologies AG and COO of Neon Equity AG. He previously held executive roles at Rag & Bone, Galvan London, and BEJOND Germany. Mr. Nixdorff holds a Master’s in Economics from Technical University of Dortmund and a B.A. in Business Administration from the University of Duisburg-Essen. We believe his experience in fashion, marketing, and investment industries supports his role on our board. Adam Epstein – Director On May 29, 2025, the Board of Directors of Perfect Moment Ltd. elected Adam Z. Epstein as a director of the Company. Mr. Epstein is the Portfolio Manager and Chief Investment Officer of MAZE Investments LLC. Mr. Epstein has worked in the financial services industry for more than two decades and brings extensive experience in capital markets, strategy, investor communications, and corporate governance. Mr. Epstein holds a BA in economics from the University of Michigan, MA in economics from the University of California, Santa Barbara and MBA in finance from the UCLA Anderson School of Management. He also holds the Chartered Financial Analyst designation. We believe he is qualified to serve on our board given his governance, finance, and investment experience. 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. Compliance with Section 16(a) Section 16(a) of the Securities Exchange Act of 1934 requires our directors, executive officers, and persons who beneficially own more than 10% of our common stock to file reports of ownership and changes in ownership with the Securities and Exchange Commission. Based solely on our review of the copies of such reports filed with the SEC and written representations from reporting persons, we believe that during the fiscal year ended March 31, 2025, all applicable Section 16(a) filing requirements were met in a timely manner, except Chath Weerasinghe, who filed one late Form 4, and Max Gottschalk, who filed one late Form 4. Insider Trading Policies We maintain an insider trading policy that applies to all directors, executive officers, employees, and consultants. The policy prohibits trading in our securities while in possession of material non-public information. 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. 43 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; 44 ● 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 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. 45 Nominating and Corporate Governance Committee 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. 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. 46 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, 2025, 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, 2025, our non-employee directors held 208,400 outstanding option awards to purchase or to be issued our common stock. As of March 31, 2025, 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. 47 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, 2025. 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, 2025. 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. Name (1) Fees Earned or Paid in Cash ($) Bonus ($) Option Awards ($) Total ($) Max Gottschalk 185,703 - - 185,703 (2) Tracy Barwin 50,000 - - 50,000 (3) Andre Keijsers 50,000 - - 50,000 (3) Berndt Hauptkorn 50,000 - - 50,000 (3) Tim Nixdorff 50,000 - - 50,000 (3) (1) Chath Weerasinghe, Chief Financial Officer and Jane Gottschalk a Director and President, Chief Creative Officer during the fiscal year ending March 31, 2025, 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. Weerasinghe and Ms. Gottschalk as employees are disclosed in the section entitled “ Executive Compensation – Summary Compensation Table ” appearing elsewhere in this Annual Report. (2) The amount reported for Mr. Gottschalk represents consulting fees paid to him pursuant to the terms of his consulting agreement. (3) The amount reported for Ms. Barwin, Mr. Keijers, Mr. Hauptkorn and Mr. Nixdorff represent their director fees for the fiscal year ended March 31, 2025. (4) On January 31, 2025, the Company terminated Mark Buckley as Chief Executive Officer of the Company. Mr. Buckley continues to serve as a director of the Company. 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 £12,000 per month. 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. Independent Director Compensation Andre Keijsers On September 15, 2023, we entered into an Independent Director Agreement with Mr. Keijsers, under which he receives an annual cash fee of $50,000 (payable in monthly installments) and was granted options to purchase 30,000 shares of common stock under the 2021 Plan. On March 5, 2024, he received an additional grant of 13,200 options. All options vest annually over four years from the agreement date and have a five-year term, subject to continued service and the terms of the applicable plan and award agreements. We also entered into a standard indemnification agreement with Mr. Keijsers and reimburse pre-approved business expenses. Berndt Hauptkorn On September 15, 2023, we entered into an Independent Director Agreement with Mr. Hauptkorn, under which he receives an annual cash fee of $50,000 (payable in monthly installments) and was granted options to purchase 30,000 shares of common stock under the 2021 Plan. On March 5, 2024, he received an additional grant of 6,000 options. Option terms, vesting, and other conditions are consistent with those described above. We also entered into a standard indemnification agreement with Mr. Hauptkorn and reimburse pre-approved business expenses. 48 Tim Nixdorff On January 18, 2024, we entered into an Independent Director Agreement with Mr. Nixdorff, under which he receives an annual cash fee of $50,000 (payable in monthly installments) and was granted options to purchase 30,000 shares of common stock under the 2021 Plan. On March 5, 2024, he received an additional grant of 6,000 options. Option terms, vesting, and other conditions are consistent with those described above. We also entered into a standard indemnification agreement with Mr. Nixdorff and reimburse pre-approved business expenses. Tracy Barwin On October 23, 2023, we entered into an Independent Director Agreement with Ms. Barwin, under which she receives an annual cash fee of $50,000 (payable in monthly installments) and was granted options to purchase 30,000 shares of common stock under the 2021 Plan. On March 5, 2024, she received an additional grant of 13,200 options. Option terms, vesting, and other conditions are consistent with those described above. We also entered into a standard indemnification agreement with Ms. Barwin and reimburse pre-approved business expenses. Outstanding Equity Awards at Fiscal Year-End The following table sets forth, for each non-employee director, certain information concerning outstanding option awards as of March 31, 2025: Name Number of securities underlying unexercised options (exercisable) (#) Number of securities underlying unexercised options (unexercisable) (#) Option exercise price ($) Option expiration date Max Gottschalk 12,500 37,500 4.10 March 4, 2029 (1) Tracy Barwin 10,800 32,400 4.10 March 4, 2034 (1) Andre Keijsers 10,800 32,400 4.10 March 4, 2034 (1) Berndt Hauptkorn 9,000 27,000 4.10 March 4, 2034 (1) Tim Nixdorff 9,000 27,000 4.10 March 4, 2034 (1) (1) 25% vesting on the first, second, third, and fourth anniversaries from director start date. 49 Executive Compensation Named Executive Officers For the fiscal year ended March 31, 2025, our named executive officers (“Named Executive Officers”) include the following individuals who held executive roles during the year: ● Mark Buckley , who served as Chief Executive Officer until his termination on January 31, 2025. Mr. Buckley continues to serve as a director of the Company. ● Jeff Clayborne , who served as Chief Financial Officer from October 2023 until his termination on January 31, 2025. ● Jane Gottschalk , who was appointed President of the Company effective February 3, 2025, and also continues to serve as our Chief Creative Officer. ● Chathura Weerasinghe , who was appointed Chief Financial Officer and Chief Operating Officer effective February 3, 2025. These individuals are collectively referred to as our Named Executive Officers for the purposes of this Annual Report. Summary Compensation Table The following table summarizes the compensation of our Named Executive Officers during the fiscal year ended March 31, 2025. 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. Name and Principal Position Fiscal Year Salary ($) Bonus ($) Stock Awards ($) Option Awards ($) All Other Compensation ($) Total ($) Mark Buckley 2025 349,269 (1) - - - - 349,269 Chief Executive Officer (until Jan. 31, 2025) 2024 314,225 (2) 187,916 (3) 1,230,000 (4) - 2,086 (5) 1,734,227 Jeff Clayborne 2025 311,217 (1) - - - - 311,217 Chief Financial Officer (Oct. 2023 – Jan. 31, 2025) 2024 83,344 (6) - - 1,183,706 (8) - 1,267,050 Jane Gottschalk 2025 257,921 (1) - - - - 1,493,964 Chief Creative Officer 2024 251,380 (2) 187,916 (2) - 1,054,668 (9) - 1,493,964 Chath Weerasinghe 2025 64,480 (10) 20,000 (10) 240,000 (10) 324,480 Chief Financial Officer (from Feb. 3, 2025) (1) Reflects actual earnings for the fiscal year ended March 31, 2025. (2) Reflects actual earnings for the fiscal year ended March 31, 2024. (3) On February 12, 2024, we paid a bonus for the successful initial public offering and listing on NYSE American. 50 (4) On March 5, we granted Mr. Buckley restricted stock units totaling $1,230,000 payable in 300,000 shares of our common stock pursuant to the terms of his employment agreement. The restricted stock units vest 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. (5) The amount reported in this column for Mr. Buckley represents PMUK contributions to the United Kingdom’s National Employment Savings Trust. (6) Reflects actual earnings for the fiscal year ended March 31, 2023, which may differ from approved 2023 base salary due to start date. (7) Reflects actual earnings for the fiscal year ended March 31, 2024, which may differ from approved 2023 base salary due to start date. (8) 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 options were forfeited upon his termination on January 31, 2025. (9) 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. (10) On February 3, 2025, we entered into an employment agreement with Mr. Weerasinghe for his service as Chief Financial Officer and Chief Operating Officer, which provides for a base salary of £300,000 per year and a sign-on bonus of £20,000 paid on his start date. He is eligible for a performance bonus of up to 50% of base salary. On February 3, 2025, we granted Mr. Weerasinghe 300,000 RSUs under the 2021 Equity Incentive Plan at a grant date fair value of $0.80 per unit. The RSUs will vest as follows: 75,000 on the first anniversary of the grant date, and 18,750 quarterly thereafter over three years, subject to continued service. Employment Agreements Named Executive Officers Mark Buckley On October 21, 2022, we entered into an employment agreement with Mr. Buckley through PMUK for his service as Chief Executive Officer, effective November 7, 2022. He also served as acting Chief Financial Officer until October 2023. Mr. Buckley receives an annual base salary of £250,000 and is eligible for performance-based bonuses. In lieu of options originally contemplated at $0.01 per share (below fair market value), he was granted 300,000 RSUs vesting over four years. Mr. Buckley also serves as a member of our board of directors. The agreement may be terminated by either party with three months’ notice, or by the Company with immediate effect upon payment in lieu of notice. The Company may also terminate without notice for cause, including material breach, gross misconduct, or dishonesty. Mr. Buckley is subject to 12-month post-termination non-solicitation covenants. Mr. Buckley’s employment as Chief Executive Officer was terminated on January 31, 2025. He was a director of the Company until March 31, 2025. Jane Gottschalk On September 7, 2022, we entered into an employment agreement with Ms. Gottschalk through PMUK for her role as Chief Creative Officer, effective September 1, 2022. She receives an annual base salary of £200,000 and was eligible for a £50,000 guaranteed bonus on her first anniversary, which she waived. Future bonuses are performance-based. On February 3, 2025, the Board appointed Ms. Gottschalk as President of the Company in addition to her ongoing role as Chief Creative Officer. In December 2024, the Board approved the cancellation of Ms. Gottschalk’s 300,000 stock options and granted her 300,000 RSUs under the 2021 Equity Incentive Plan, with a four-year annual vesting schedule beginning October 20, 2024. The agreement may be terminated by either party with three months’ notice or by the Company with immediate effect upon payment in lieu of notice. The Company may also terminate without notice for cause, including material breach, gross misconduct, or dishonesty. Ms. Gottschalk is subject to 12-month post-termination non-solicitation restrictions. 51 Chath Weerasinghe - Chief Financial Officer (from Feb. 3, 2025) On February 3, 2025, the Company entered into an employment agreement (the “Employment Agreement”) with Chath Weerasinghe for his service as Chief Financial Officer and Chief Operating Officer of the Company. The terms of Mr. Weerasinghe’s Employment Agreement provide for a base salary of £300,000 per year and allow for a performance bonus of up to 50% of Mr. Weerasinghe’s annual salary subject to achieving certain performance targets. Additionally, per the terms of the Employment Agreement, Mr. Weerasinghe will receive a sign-on bonus of £20,000, to be paid on Mr. Weerasinghe’s start date, February 3, 2025. In addition, Mr. Weerasinghe will be entitled to participate in the Company’s 2021 Equity Incentive Plan, with 300,000 restricted stock units (the “RSUs”) to be granted as of Mr. Weerasinghe’s start date. The RSUs will vest over a period of four years pursuant to a Restricted Stock Unit Agreement, with 75,000 RSUs vesting on the twelve (12) month anniversary of the start date and the remaining RSUs will vest quarterly over three years, with 18,750 RSUs vesting per quarter. Other Executive Officers Jeff Clayborne On October 20, 2023, we entered into an employment agreement with Mr. Clayborne for his service as Chief Financial Officer, which was amended on January 22, 2024. The agreement provided for an annual base salary of $275,000 and eligibility for a discretionary annual bonus. The initial term was two years, subject to automatic one-year renewals unless terminated by either party with 30 days’ notice. In December 2024, the Board cancelled Mr. Clayborne’s stock option grant for 300,000 shares and approved the grant of (i) 300,000 RSUs with a four-year annual vesting schedule beginning October 20, 2024, and (ii) 106,667 RSUs with a four-year annual vesting schedule beginning October 20, 2025, at a grant date fair value of $1.12 per RSU. Mr. Clayborne’s employment was terminated on January 31, 2025, and a total of 371,467 RSUs were forfeited upon termination. The agreement provided for severance of three months’ base salary and a lump sum of $13,300 if terminated without cause or for good reason, subject to customary conditions including a release of claims. Mr. Clayborne was also subject to one-year post-termination non-compete and non-solicitation restrictions, and confidentiality and indemnification provisions. As of March 31, 2025, Mr. Clayborne held no options and no vested RSUs. 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 former Chief Executive Officer and former acting Chief Financial Officer. During the fiscal year ended March 31, 2025 and March 31, 2024, we contributed $1.7 thousand and $1.7 thousand, respectively, to NEST on behalf of 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 30, 2025, there were 4,299,957 shares of our common stock granted or available for grant under the 2021 Plan of which 1,571,807 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. 52 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. 53 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. 54 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. 55 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, 2025: Name Number of securities underlying unvested restricted stock awards (#) Fair Value ($) Vest date Chath Weerasinghe 300,000 0.80 February 2, 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, 2025: 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) (1) All shares have fully vested. 56 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 30, 2025, 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, 2025. 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 1,470,206 $ 2.13 2,693,407 Equity compensation plans not approved by securityholders 136,344 $ 0.01 - Total 1,606,550 $ 1.95 2,693,407 Security Ownership of Certain Beneficial Owners The following table sets forth certain information regarding the beneficial ownership of our common stock as of June 30, 2025 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 35,708,299 based on the beneficial ownership of our common stock and Series AA Preferred Stock that currently convert at a rate of five shares of Common Stock for every one share of Series AA Preferred Stock as of June 30, 2025. 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 30, 2025. 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 Kahala 19 (1) 3,361,995 9 % (1) Kahala 19 beneficially owns 2,500,000 shares of Common Stock and 172,399 shares of Series AA Preferred Stock that currently convert at a rate of five shares of Common Stock for every one share of Series AA Preferred Stock. The address of Kahala 19 is 11550 Meridian ST, Ste 125, Carmel IN 46032 57 Security Ownership of Management The following table sets forth certain information regarding the beneficial ownership of our common stock and Series AA Preferred Stock that currently convert at a rate of five shares of Common Stock for every one share of Series AA Preferred Stock as of June 30, 2025 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 United House, 9 Pembridge Road, London W11 3JY, 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) 7,219,467 20.2 % Mark Buckley (3) 203,250 0.6 % Jane Gottschalk (4) 7,219,467 20.2 % Andre Keijsers (5) 23,845 * Berndt Hauptkorn (6) 9,000 * Tracy Barwin (7) 10,800 * Tim Nixdorff (8) 9,000 * Adam Epstein (9) - All directors and executive officers as a group 7,475,778 38.1 % * Less than 1%. (2) Consists of (i) 3,479,491 shares of common stock held of record by Fermain Limited; (ii) 242,625 shares of common stock held of record by JGA; (iii) 1,692,694 shares of common stock issued to JGA as consideration for the extinguishment of unpaid principal and interest on an outstanding promissory note totaling $507,808 at the per share price of $0.30 during the offering completed on June 30, 2025; (iv) 68,172 shares of common stock issuable upon the exercise of stock options by Mr. Gottschalk’s spouse, Jane Gottschalk; (v) 12,500 shares of common stock issuable upon the exercise of stock options and (vi) the total excludes 37,500 shares of our common stock underlying stock options not exercisable within 60 days of June 30, 2025. Mr. Gottschalk beneficially owns 3,802,988 shares of Common Stock and 344,797 shares of Series AA Preferred Stock through JGA that currently convert at a rate of five shares of Common Stock for every one share of Series AA Preferred Stock. (3) Consists of 203,250 shares of common stock held directly. (4) Consists of (i) 3,479,491 shares of common stock held of record by Fermain Limited; (ii) 242,625 shares of common stock held of record by JGA; (iii) 68,172 shares of common stock issuable upon the exercise of stock options (iv)12,500 shares of common stock issuable upon the exercise of stock options by Ms. Gottschalks spouse, Max Gottschalk and (v) the total excludes 37,500 shares of our common stock underlying stock options not exercisable within 60 days of June 30, 2025 held by Ms. Gottschalk’s spouse, Max Gottschalk. Ms. Gottschalk beneficially owns 3,802,988 shares of Common Stock and 344,797 shares of Series AA Preferred Stock that currently convert at a rate of five shares of Common Stock for every one share of Series AA Preferred Stock. (5) Consists of 13,045 shares of common stock held directly and 10,800 shares of common stock issuable upon the exercise of stock options. The total excludes 32,400 shares of our common stock underlying stock options not exercisable within 60 days of June 30, 2025. (6) Consists of 9,000 shares of common stock issuable upon the exercise of stock options. The total excludes 27,000 shares of our common stock underlying stock options not exercisable within 60 days of June 30, 2025. (7) Consists of 10,800 shares of common stock issuable upon the exercise of stock. The total excludes 32,400 shares of our common stock underlying stock options not exercisable within 60 days of June 30, 2025. (8) Consists of 9,000 shares of common stock issuable upon the exercise of stock. The total excludes 27,000 shares of our common stock underlying stock options not exercisable within 60 days of June 30, 2025. (9) [●] 58 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 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, 2025. 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. Below are the directors of the Company and its subsidiaries, that provided consulting and advisory services during the year. Year Ended March 31, 2025 Year Ended March 31, 2024 (Amounts in thousands) (A) Max Gottschalk (director of the Company) $ 185 $ 181 (B) Tracy Barwin (director of the Company) - 121 (C) Andre Keijsers(director of the Company) - 22 Total Expenses $ 185 $ 324 59 (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 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. Other Transactions with Related Persons The Chairman has provided a $4,000 personal guarantee for the Company’s trade finance facility. The guarantee is a pay-on-demand guarantee securing the Company’s obligations under the trade finance facility, including interest and bank costs, fees and expenses, up to $4,000. The Chairman does not receive consideration in exchange for the personal guarantee. In March 2025, the Company entered into securities purchase agreements with a company controlled by the Chairman whereby the Company issued 344,797 shares of Series AA Preferred Stock at an original issue price of $5.8005 per share for gross proceeds of $2,000. 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. 60 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., our independent registered public accounting firm for fiscal years ended 2025 and 2024, respectively (amounts in thousands). Fees 2025 2024 Audit Fees $ 272 $ 266 Audit Related Fees 44 37 Tax Fees - - Other Fees related to initial public offering - 177 Total Fees $ 316 $ 480 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. 61 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, 2025 and 2024 F-3 Statements of Operations and Comprehensive Loss for the years ended March 31, 2025 and 2024 F-4 Statements of Changes in Stockholders’ Equity for the years ended March 31, 2025 and 2024 F-5 Statements of Cash Flows for the years ended March 31, 2025 and 2024 F-6 Notes to Consolidated Financial Statements for the years ended March 31, 2025 and 2024 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, 2025 and 2024, the related consolidated statements of operations and comprehensive loss, stockholders’ equity, 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, 2025 and 2024, 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, 2025, and the Company had an accumulated deficit at March 31, 2025. 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 Company 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 June 30, 2025 F- 2 PERFECT MOMENT LTD. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Amounts in thousands, except share and per share data) March 31, 2025 March 31, 2024 ASSETS Current assets: Cash and cash equivalents $ 6,159 $ 7,910 Restricted cash 1,350 - Accounts receivable, net 886 1,035 Inventories, net 1,567 2,230 Prepaid and other current assets 2,812 742 Total current assets 12,774 11,917 Long term assets: Operating lease right-of-use assets 44 143 Property and equipment, net 483 502 Other non-current assets 36 47 Total assets $ 13,337 $ 12,609 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Trade payables $ 2,594 $ 1,584 Accrued expenses 4,233 2,697 Trade finance facility 2,495 - Short-term borrowings, net 1,851 - Operating lease liabilities, current 44 101 Unearned revenue 264 420 Total current liabilities 11,481 4,802 Long term liabilities: Operating lease liabilities, non-current - 44 Total liabilities 11,481 4,846 Commitments and contingencies (see Note 14) - - Stockholders’ equity: Series AA convertible preferred stock, $ 0.0001 par value, 1,800,000 shares authorized; 924,921 shares and nil shares issued and outstanding as of March 31, 2025 and 2024, respectively - - Common stock, $ 0.0001 par value, 100,000,000 shares authorized: 19,291,000 and 15,653,449 shares issued and outstanding as of March 31, 2025 and 2024, respectively 2 1 Additional paid-in-capital 66,793 56,824 Accumulated other comprehensive loss ( 23 ) ( 85 ) Accumulated deficit ( 64,916 ) ( 48,977 ) Total stockholders’ equity 1,856 7,763 Total liabilities and stockholders’ equity $ 13,337 $ 12,609 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 LOSS (Amounts in thousands, except share and per share data) Year Ended March 31, 2025 Year Ended March 31, 2024 Revenue, net $ 21,501 $ 24,443 Cost of sales 11,072 12,001 Gross profit 10,429 12,442 Operating expenses: Selling, general and administrative expenses 20,685 15,333 Marketing and advertising expenses 3,540 4,784 Total operating expenses 24,225 20,117 Loss from operations ( 13,796 ) ( 7,675 ) Other income (expense), net Interest expense ( 2,046 ) ( 1,311 ) Foreign currency transactions (loss) gain ( 107 ) 264 Other income 10 - Total other expense, net ( 2,143 ) ( 1,047 ) Net Loss $ ( 15,939 ) $ ( 8,722 ) Other comprehensive losses Foreign currency translation gain (loss) 62 ( 288 ) Comprehensive loss $ ( 15,877 ) $ ( 9,010 ) Basic and diluted loss per share $ ( 0.99 ) $ ( 1.34 ) Basic and Diluted weighted-average number of shares outstanding 16,095,138 6,518,960 The accompanying notes are an integral part of these consolidated financial statements F- 4 PERFECT MOMENT LTD AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY For the Years Ended March 31, 2025 and 2024 (Amounts in thousands, except share data) Preference Shares Accumulated Total Series AA Convertible Series A Convertible Series B Convertible Common Shares Additional Paid-in Other Comprehensive Accumulated Stockholders’ Equity Shares Amount Shares Amount Shares Amount Shares Amount Capital Income (Loss) Deficit (Deficit) Balance -March 31, 2023 - $ - 5,323,782 $ 1 1,189,998 $ - 4,824,352 $ - $ 35,910 $ 203 $ ( 40,255 ) $ ( 4,141 ) Stock compensation on employee vested RSUs - - - - - - 75,000 - 429 - - 429 Stock compensation expense for employee vested options - - - - - - - - 310 - - 310 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 ) 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 Stock compensation expense for employee vested options - - - - - - - - 715 - - 715 Stock compensation on employee vested RSUs - - - - - - 285,449 - 619 - - 619 Fair value of shares issued for services - - - - - - 1,352,102 - 1,488 - - 1,488 Issuance of preferred stock and warrants, net 924,921 - - - - - - - 5,148 - - 5,148 Issuance of common stock upon conversion of convertible debt - - - - - - 2,000,000 1 1,999 - - 2,000 Foreign currency translation adjustment - - - - - - - - - 62 - 62 Net loss - - - - - - - - - - ( 15,939 ) ( 15,939 ) Balance – March 31, 2025 924,921 $ - - $ - - $ - 19,291,000 $ 2 $ 66,793 $ ( 23 ) $ ( 64,916 ) $ 1,856 Balance 924,921 $ - - $ - - $ - 19,291,000 $ 2 $ 66,793 $ ( 23 ) $ ( 64,916 ) $ 1,856 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) Year Ended Year Ended March 31, 2025 March 31, 2024 Operating Activities: Net loss $ ( 15,939 ) $ ( 8,722 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization 342 555 Bad debt expense ( 21 ) 217 Inventory reserve 1,599 382 Realized foreign exchange (gain) loss 107 ( 128 ) Stock based compensation 1,334 739 Amortization of stock-based marketing services shares issued for services 910 185 Amortization of debt finance costs 1,801 492 Other ( 10 ) - Effect of changes in assets and liabilities: Accounts receivable, net 160 ( 238 ) Inventories, net ( 937 ) ( 349 ) Prepaid and other current assets ( 1,493 ) ( 219 ) Operating lease right-of-use assets 99 268 Other non-current assets 3 ( 37 ) Operating lease right-of-use liability ( 100 ) ( 162 ) Trade payables 903 295 Accrued expenses 1,536 2,029 Unearned revenue ( 155 ) 240 Net cash used in operating activities ( 9,861 ) ( 4,453 ) Investing Activities: Purchases of property and equipment ( 302 ) ( 211 ) Net cash used by investing activities ( 302 ) ( 211 ) Financing Activities: Proceeds from initial public offering - 6,009 Proceeds from sale of common stock - 2,179 Proceeds from issuance of preference shares and warrants, net 5,148 - Proceeds from convertible debt obligations 2,000 - Proceeds from trade finance facility 2,845 1,847 Repayment of trade finance facility ( 351 ) ( 1,873 ) Proceeds from short-term borrowings, net 5,792 - Repayment of short-term borrowings ( 5,742 ) - Net cash provided by financing activities 9,692 8,162 Effect of Exchange Rate Changes on Cash 70 ( 300 ) Net change in cash ( 401 ) 3,198 Cash and cash equivalents and restricted cash - beginning of period 7,910 4,712 Cash and cash equivalents and restricted cash - end of period $ 7,509 $ 7,910 Supplemental disclosures of cash flow information: Interest paid on borrowings and bank loans $ 154 $ 107 Reconciliation of cash, cash equivalents, and restricted cash reported in the consolidated balance sheets Cash and cash equivalents $ 6,159 $ 7,910 Restricted cash 1,350 - Total cash, cash equivalents and restricted cash presented in the consolidated statements of cash flows $ 7,509 $ 7,910 Supplemental disclosure of non-cash investing and financing activities: Conversion of convertible debt to common stock $ 2,000 $ 11,987 Fair value of shares issued in exchange for services to be received $ 1,488 $ - Recognition of debt discounts on short-term borrowings $ 2,866 $ - Offset of deferred offering costs to proceeds received $ - $ 1,169 Recognition of operating lease right of use assets and lease obligations $ - $ 198 Write-off of expired operating lease right-of-use assets and lease obligations $ - $ 53 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, 2025 AND 2024 (Unless otherwise indicated, dollar amounts in thousands) 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. 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 (see Note 10). 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 Underwriters did not exercise the over-allotment option. 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. References to GAAP issued by the FASB in these accompanying notes to the financial statements are to the Financial Accounting Standard Board (“FASB”) Accounting Standards Codification (“ASC”). The financial statements have been prepared assuming the Company will continue as a going concern. 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 (“PMTM”). All significant intercompany balances and transactions have been eliminated in consolidation. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Going concern Through March 31, 2025, 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 $ 15,939 for the year ended March 31, 2025 and used cash in operations of $ 9,861 during that period. As of March 31, 2025, the Company had an accumulated deficit of $ 64,916 . These factors raise substantial doubt about the Company’s ability to continue as a going concern for at least twelve months from the date these consolidated financial statements were available to be issued. The Company’s ability to continue as a going concern is dependent upon the management of its expenses and its ability to obtain necessary financing to meet its obligations and pay its liabilities arising from normal business operations when they come due, and upon profitable operations F- 7 The Company’s future capital requirements will depend on many factors, including production costs and planned growth. In order to finance these opportunities and associated costs, it is possible that the Company would need to raise additional financing if working capital is insufficient to support its business needs. While there can be no assurances, the Company intends to raise such capital through additional short-term loan issuances, debt factoring, and additional equity raises. If additional financing is required from outside sources, the Company may not be able to raise it on terms acceptable to it or at all. If the Company is unable to raise additional capital on acceptable terms when needed, its product development , results of operations and financial condition would be materially and adversely affected. As a result of the above, in connection with the Company’s assessment of going concern considerations in accordance with FASB’s Accounting Standards Update (“ASU”) 2014-15, Disclosures of Uncertainties about an Entity’s Ability to Continue as a Going Concern , management has determined that the Company’s liquidity condition raises substantial doubt about the Company’s ability to continue as a going concern through twelve months from the date these consolidated financial statements are available to be issued. These consolidated financial statements do not include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be necessary should the Company be unable to continue as a going concern. Emerging Growth Company The Company is expected to be an emerging growth company, as defined in the Jumpstart Our Business Startups (“JOBS”) Act. Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act, until such time as to those standards apply to private companies. The Company has elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date that it (i) is no longer an emerging growth company or (ii) affirmatively and irrevocably opts out of the extended transition period provided in the JOBS Act. As a result, these consolidated financial statements may not be comparable to companies that comply with the new or revised accounting pronouncements as of public company effective dates. 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 believes will materially affect the methodology or assumptions utilized in making these estimates and judgments in these consolidated financial statements. Significant estimates inherent in the preparation of the consolidated financial statements include reserves for uncollectible accounts receivables, realizability of inventory; sales reserves; useful lives and impairments of long-lived assets; realization of deferred tax assets and related uncertain tax positions; classification of convertible preferred stock, classification of warrants, 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. Seasonality The Company experiences certain effects of seasonality with respect to its business. The Company generally experiences greater sales during its last three fiscal quarters, primarily driven by ski and outerwear sales being higher during the winter months and the Company’s customers concentrated in the northern hemisphere, and the lowest sales during its first fiscal quarter. Revenue Recognition Revenues are recognized when the Company’s performance obligations are satisfied as evidenced by transfer of control of promised goods to customers or consumers, in an amount that reflects the consideration the Company expects to be entitled to receive in exchange for those goods or services. 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 transactions within the Company’s wholesale channel, control generally transfers to the customer upon shipment to, or upon receipt by, the customer depending on the terms of sale with the customer. For inventories sold on consignment to wholesalers, the Company records revenue when the inventory is sold to the third-party customer by the wholesaler. For transactions within the Company’s direct-to-consumer (“DTC”) channel, control generally transfers to the consumer at the time of sale within retail stores and generally upon receipt by the consumer with respect to e-commerce transactions. In certain arrangements the Company receives payment before the customer receives the promised good. These payments are initially recorded as deferred revenue, a contract liability, and recognized as revenue in the period when control is transferred to the customer. The amount of consideration the Company expects to be entitled to receive and recognize as revenue, net across both wholesale and DTC channels varies with changes in sales returns, other accommodations and incentives offered. The Company estimates expected sales returns and other accommodations, such as chargebacks and markdowns, and records a sales reserve to reduce revenue . These estimates are based on historical rates of product returns and claims, as well as events and circumstances that indicate changes to such historical rates are warranted. However, actual returns and claims in any future period are inherently uncertain and thus may differ from estimates. As a result, the Company adjusts estimates of revenue at the earlier of when the most likely amount of consideration the Company expects to receive changes or when the amount of consideration becomes fixed. If actual or expected future returns and claims are significantly different than the sales reserves established, the Company records an adjustment to revenue, net in the period in which it made such determination. As of March 31, 2025 and 2024, the provision for returns was $ 594 and $ 298 , respectively, and included as a component of accrued expenses on the accompanying consolidated balance sheets. Partnership revenue is recognized over time based on the greater of contractual minimum guarantees and actual, or estimated, sales of products by the Company’s partners. 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. The Company expenses sales commissions when incurred, which is generally at the time of sale, because the amortization period would have been one year or less. These costs are recorded within selling, general and administrative expenses on the accompanying statements of operations and comprehensive loss. As of March 31, 2025 and 2024, the Company did not have any contract assets and had $ 264 and $ 420 , respectively, of unearned revenue on the accompanying consolidated balance sheets. Revenue recognized from contracts with customers is recorded net of sales taxes, value added taxes, or similar taxes that are collected on behalf of local taxing authorities. F- 8 For the years ended March 31, 2025 and 2024 revenue, net recognized from performance obligations related to prior periods were not material. Revenue, net expected to be recognized in any future period related to remaining performance obligations is not material. Disaggregated revenue The following table disaggregates the Company’s revenue, net by channel and geographic location: SCHEDULE OF REVENUE NET BY CHANNEL AND GEOGRAPHICAL LOCATION Year ended March 31, 2025 Year ended March 31, 2024 Channel revenue, net Wholesale revenues $ 10,111 $ 10,891 Ecommerce revenues 10,060 10,383 Retail revenues 775 - Partnership revenues 555 3,169 Total revenue, net $ 21,501 $ 24,443 Geographic location revenue, net Europe (excluding United Kingdom) $ 7,202 $ 7,909 United States 8,236 9,935 United Kingdom 4,168 4,845 Rest of the world 1,895 1,754 Total revenue, net $ 21,501 $ 24,443 Cost of sales Cost of sales consists of all direct costs to source and purchase raw materials and finished goods, production costs (including labor), non-refundable taxes, duties, other landing costs, as well as specific provisions for excess, close-out or slow-moving inventory. Cost of sales also includes freight costs associated with the shipment of goods to the Company’s warehouses and distribution centers, including freight costs associated with the transfer of inventory within the Company’s third-party fulfillment and distribution centers and to the Company’s retail stores. Selling, general and administrative expenses Selling, general and administrative expenses consist of personnel-related costs, depreciation and amortization, occupancy, warehousing, professional fees, technology, human resources, legal, and other selling and general operating expenses related to the Company’s business functions. Selling, general and administrative expenses also include costs associated with the handling of inventory and warehousing costs associated with the operation of the Company’s third-party fulfillment and distribution centers. Marketing and advertising expenses Marketing and advertising expenses consist of agency, contractor and consulting expense, content production, promotional operating expense, and advertising costs. Advertising costs, including the costs to produce advertising, are expensed in the period incurred. Total advertising expense was $ 1,646 and $ 1,446 for the years ended March 31, 2025 and 2024, respectively. F- 9 Cash and cash equivalents and restricted cash Cash and cash equivalents consist of cash on hand and bank balances with original maturities of three months or less. The Company has not experienced any losses related to these balances, and management believes the Company’s credit risk to be minimal. Restricted cash consists of cash deposits and certificate of deposits under the Company’s trade finance facility (see Note 8). Restricted cash is classified as current on the accompanying consolidated balance sheets as the trade finance facility can be due on demand. The Company maintains the majority of cash at Chase or 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, 2025, we do not believe we have any significant concentrations of credit risk due to the strong credit rating of Chase and HSBC. 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. Accounts receivable and allowance for credit losses Accounts receivable primarily arise out of sales customers. The allowance for credit losses is an amount equal to the estimated probable losses net of recoveries in accounts receivable using the incurred loss methodology. After considering current economic conditions and specific and financial stability of its customers, an allowance for credit losses is maintained in the consolidated balance sheet at a level which management believes is sufficient to cover all probable future credit losses as of the balance sheet date based on specific reserves and an expectation of future economic conditions that might impact collectability. Accounts receivable are carried net of allowances for credit losses as of March 31, 2025 and 2024. After all reasonable attempts to collect a receivable have failed, the amount of the receivable is written off against the allowance. As of March 31, 2025 and 2024, the Company had $ 547 and $ 558 , respectively, in allowances for credit losses. Concentration of credit risk : Supplier In the years ended March 31, 2025 and 2024, the largest single supplier of the Company’s manufactured goods produced 39 % and 75 %, respectively, of the company’s products. In the years ended March 31, 2025 and 2024, the largest fabric supplier supplied 82 % and 79 %, respectively, of the fabric used to manufacture the Company’s products. Customer For the years ended March 31, 2025 and 2024, we had individual customers that accounted for approximately 12 % and 13 %, respectively, of total revenue, net. These customers individually did not comprise more than 10 % of total accounts receivable as of March 31, 2025 and 2024. As of March 31, 2025 and 2024, two customers accounted for approximately 27 % of total accounts receivable. These customers did not comprise individually more than 10 % of total revenues during the years ended March 31, 2025 and 2024. F- 10 Inventories, net Inventories, consisting of finished goods, inventories in transit, and raw materials, are stated at the lower of cost or net realizable value. Cost is determined on a first-in, first-out basis, and includes all costs incurred to deliver inventory to the Company’s third-party fulfillment and distribution centers, including freight, non-refundable taxes, duty and other landing costs. The Company periodically reviews its inventories and makes a provision as necessary to appropriately value goods that are obsolete, have quality issues, or are damaged. The amount of the provision is equal to the difference between the cost of the inventory and its net realizable value based upon assumptions about product quality, damages, future demand, selling prices, and market conditions. If changes in market conditions result in reductions in the estimated net realizable value of its inventory below its previous estimate, the Company would increase its provision in the period in which it made such a determination. In addition, the Company provides for inventory shrinkage based on historical trends from actual physical inventory counts. Inventory shrinkage estimates are made to reduce the inventory value for lost or stolen items. The Company performs physical inventory counts and cycle counts throughout the year and adjusts the shrink provision accordingly. Prepaid and other current assets Amounts recorded in prepaid and other current assets consist of employee advances, unbilled accounts receivable, prepaid insurance, and other current assets, all of which are expected to be realized within one year from the reporting period. Property and Equipment Property and equipment are recorded at cost less accumulated depreciation. Cost of property and equipment consists of purchase price, conversion cost and estimated cost of dismantling and restoration. Expenditures such as repairs and maintenance, overhaul costs and borrowing costs are expensed as incurred. Expenditures that extend the useful life of an asset are capitalized. Direct internal and external costs related to software used for internal purposes and website development which are incurred during the application development stage or for upgrades that add functionality are capitalized. All other costs related to internal use software are expensed as incurred. Property and equipment carrying values are reviewed for impairment when events or circumstances indicate that the asset group to which the property and equipment belong might be impaired. The following estimated useful lives are used for to depreciate property and equipment on a straight-line basis: SCHEDULE OF PROPERTY AND EQUIPMENT USEFUL LIFE Useful Life Furniture and fixtures 5 years Office equipment 3 - 5 years Computer equipment 3 years Software and website development 3 years Leasehold improvements Lessor of 5 years or remaining term of underlying lease Convertible preferred stock : Convertible preferred stock consists of preferred stock shares issued with an option to convert into shares of common stock at the option of holders. The convertible preferred stock are accounted for as permanent equity in the scope of ASC 815, Derivatives and Hedging (“ASC 815”) and recorded at fair value which is representative of the proceeds received (see Note 10). Warrants We evaluate the appropriate balance sheet classification of warrants we issue as either equity or as a derivative liability. In accordance with ASC 815, we classify a warrant as equity if it is “indexed to the Company’s equity” and meets several specific conditions for equity classification. A warrant is not considered “indexed to the Company’s equity,” in general, when it contains certain types of exercise contingencies or potential adjustments to its exercise price. If a warrant is not indexed to the Company’s equity or it has net cash settlement provisions that result in the warrants being accounted for under ASC 480, Distinguishing Liabilities from Equity (“ASC 480”) or ASC 815, it is classified as a derivative liability which is carried on the consolidated balance sheets at fair value with any changes in its fair value recognized in the statements of operations and comprehensive loss. At March 31, 2025 and 2024 all of the Company’s outstanding warrants were classified as equity. Leases The Company determines if an arrangement is or contains a lease at contract inception, recording a lease liability and corresponding right-of-use asset at lease commencement for identified leases at the lease commencement date, which is generally when the Company takes possession of the asset. Lease agreements may contain adjustments to lease payments based on fixed escalation clauses, an index or a rate. Lease agreements may also require the Company to pay real estate taxes, insurance, common area maintenance, and other costs, collectively referred to as operating costs, in addition to lease payments. Lease agreements also may contain lease incentives, such as tenant improvement allowances and rent holidays. Lease agreements can include one or more options to renew or extend the initial lease term. The exercise of a lease renewal option is generally at the Company’s sole discretion. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants The lease liability is initially measured at the present value of the minimum fixed lease payments over the expected lease term, which includes options to extend or terminate the lease agreement when it is reasonably certain those options will be exercised, using the Company’s discount rate as of lease commencement. Minimum fixed lease payments are discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Company’s incremental borrowing rate. Generally, the Company cannot determine the interest rate implicit in the lease because it does not have access to the lessor’s estimated residual value or the amount of the lessor’s deferred initial direct costs. Therefore, the Company generally uses its incremental borrowing rate as the discount rate for the lease. The Company’s incremental borrowing rate for a lease is the rate of interest it would have to pay on a collateralized basis to borrow an amount equal to the lease payments under similar terms. Because the Company does not generally borrow on a collateralized basis, it uses market-based rates as an input to derive an appropriate incremental borrowing rate, adjusted for the lease term and the effect on that rate of designating specific collateral with a value equal to the unpaid lease payments for that lease. The Company has elected the practical expedient to account for the lease and non-lease components as a single lease component. Therefore, minimum lease payments used to measure the lease liability include all of the fixed consideration in the contract. Variable lease payments associated with the Company’s leases are recognized upon the occurrence of the event, activity, or circumstance in the lease agreement on which those payments are assessed. Variable lease payments are presented in the accompanying consolidated statements of operations and comprehensive loss in the same line item as expense arising from fixed lease payments, which is generally within selling, general and administrative expenses. Leases with an initial term of 12 months or less are considered short-term leases and not recorded on the accompanying consolidated balance sheets. The Company recognizes lease expense for short-term leases on a straight-line basis over the lease term in the same line item as expense arising from fixed lease payments, which is generally within selling, general and administrative expenses. F- 11 Long-Lived Assets Long-lived assets held for use are evaluated for impairment when the occurrence of events or a change in circumstances indicate that the carrying value of the assets may not be recoverable. In these cases, the Company estimates the future undiscounted cash flows to be derived from the asset or asset group to determine whether the asset or asset group is recoverable. If the carrying value of an asset or asset group exceeds the estimated undiscounted future cash flows, an analysis is performed to estimate the fair value of the asset or asset group. An impairment is recorded if the fair value of the asset or asset group is less than the carrying amount. Impairment charges of long-lived assets, if any, are classified as selling, general and administrative expenses on the accompanying consolidated statements of operations and comprehensive loss. The Company did not record impairment losses for the years ended March 31, 2025 and 2024. Income Taxes The Company is required to estimate its income taxes in each of the jurisdictions in which it operates as part of preparing the consolidated financial statements. This involves estimating the actual current tax in addition to assessing temporary differences resulting from differing treatments for tax and financial accounting purposes. These differences, together with net operating loss carryforwards and tax credits, are recorded as deferred tax assets or liabilities on the Company’s consolidated balance sheet. 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. A judgment must then be made of the likelihood that any deferred tax assets will be recovered from future taxable income. A valuation allowance may be required to reduce deferred tax assets to the amount that is more likely than not to be realized. In the event the Company determines that it may not be able to realize all or part of its deferred tax asset in the future or that new estimates indicate that a previously recorded valuation allowance is no longer required, an adjustment to the deferred tax asset is charged or credited to income in the period of such determination. The Company recognizes tax positions that meet a “more likely than not” minimum recognition threshold. If necessary, the Company recognizes interest and penalties associated with tax matters as part of the income tax provision and would include accrued interest and penalties with the related tax liability in the consolidated balance sheets. Foreign currency The Company’s reporting currency is the U.S. Dollar (“USD”). The functional currency for each entity included in these consolidated financial statements is the applicable local currency of each entity. The Company’s entities domiciled in the United States, United Kingdom, Hong Kong and Switzerland maintain their books and records in their local currencies, which are USD, Great Britain Pound (“GBP”), Hong Kong Dollar (“HKD”) and Swiss Franc (“CHF”), respectively. For each entity whose functional currency is not the USD, assets and liabilities are translated into USD using the exchange rate in effect on the balance sheet date and revenue and expenses are translated into USD on a monthly basis using the average rate in effect for that month. Translation gains and losses are recorded as a foreign currency translation adjustment as a component of other comprehensive loss, which is a component of accumulated other comprehensive loss on the accompanying consolidated balance sheets. Pursuant to US GAAP, assets and liabilities of the Company’s foreign operations with functional currencies other than the USD are translated at the exchange rate in effect at the balance sheet date, while revenues and expenses are translated at average rates prevailing during the periods. Translation adjustments are reported in accumulated other comprehensive loss, a separate component of stockholders’ equity. Cash flows are also translated at average translation rates for the periods; therefore, amounts reported on the consolidated statements of cash flows will not necessarily agree with changes in the corresponding balances on the consolidated balance sheets. Transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are included in the results of operations as incurred. 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 EXCHANGE RATE Year end exchange rate: Year Ended March 31, 2025 Year Ended March 31, 2024 GBP:USD 1.29539 1.26254 HKD:USD 0.12856 0.12778 CHF:USD 1.13505 1.10871 Average exchange rate: March 31, 2025 March 31, 2024 Average exchange rate: Year Ended March 31, 2025 Year Ended March 31, 2024 GBP:USD 1.27522 1.27055 HKD:USD 0.12828 0.12782 CHF:USD 1.12788 1.12514 F- 12 Stock-based compensation Share-based compensation cost is estimated at the grant date based on the award’s fair value. For stock options, time-based restricted stock units, and market-based restricted stock units, share-based compensation cost is recognized over the expected requisite service period using the straight-line attribution method. For equity-classified market-based restricted stock units, the probability of achieving the related market condition is incorporated into the grant date fair value. If targets are not met, no compensation cost will be reversed except in the case of award forfeitures. For performance-based restricted stock units, share-based compensation cost is recognized based on the Company’s assessment of the probability of achieving the related performance targets. If such targets are not met, no compensation cost is recognized and any previously recognized compensation cost is reversed. The Company estimates forfeitures for share-based awards granted, but which are not expected to vest. The inputs into the Black Scholes option pricing model are subjective and generally require significant judgment. Prior to going public, 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 up until February 8, 2024. 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 listed 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 Q3 2025 the company used the average of a peer group of 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. Comprehensive loss Comprehensive loss includes net loss as well as other changes in shareholders’ deficit that result from transactions and economic events other than those with shareholders. For the year ended March 31, 2025, these changes related to foreign currency translation gains and losses. There were no reclassifications out of comprehensive loss for the years ended March 31, 2025 and 2024. Loss per share of common stock Basic net loss per share is computed by dividing net 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 loss 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, 2025 and 2024, 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 FOR BASIC AND DILUTED NET INCOME (LOSS) PER SHARE March 31, 2025 March 31, 2024 Options to acquire common stock 1,006,550 1,108,356 Restricted stock units granted to employees to acquire stock 600,000 225,000 Warrants to acquire common stock 123,376 66,700 Series AA convertible preferred stock 4,624,620 - Antidilutive securities 6,354,546 1,400,056 Fair Value of Financial Instruments ASC 820, Fair Value Measurements and Disclosures (“ASC 820”), clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based upon assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, ASC 820 establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: Level 1: Inputs based on unadjusted 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 Level 1, such as quoted prices for similar assets or liabilities in active markets or quoted prices for identical or similar instruments in markets that are not active or for which all significant inputs are observable or can be corroborated by observable market data Level 3: Inputs reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. The inputs are both unobservable for the asset and liability in the market and significant to the overall fair value measurement. An asset’s or liability’s fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Valuation techniques used need to maximize the use of observable inputs and minimize the use of unobservable inputs. Assets and liabilities measured at fair value are based on one or more of the following techniques noted in ASC 820: ● Market approach: Prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities. ● Cost approach: Amount that would be required to replace the service capacity of an asset (replacement cost). ● Income approach: Techniques to convert future amounts to a single present value amount based upon market expectations (including present value techniques, option pricing, and excess earnings models). The Company believes its valuation methods are appropriate and consistent with other market participants, however the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date. The carrying amount of the Company’s financial assets and liabilities, such as cash and cash equivalents, prepaid expenses, accounts payable, accrued expenses and operating lease liabilities approximate their fair value due to their short-term nature or expected settlement date of these instruments. The carrying values of debt obligations approximate their fair values due to the fact that the interest rates on these obligations are based on prevailing market interest rates. The Company does not have financial instruments measured at fair value on a recurring basis as of March 31, 2025 and 2024. It is management’s opinion that the Company is not exposed to significant interest or credit risks arising from these financial instruments. Segment Reporting ASC 280, Segment Reporting (“ASC 280”), defines operating segments as components of an enterprise where discrete financial information is available that is evaluated regularly by the chief operating decision-maker (“CODM”) in deciding how to allocate resources and in assessing performance. The Company’s chief financial officer and chief creative officer collectively perform the function that allocates resources and assesses performance, and thus together, serve as the Company’s CODM. The CODM reviews the assets, operating results, and financial metrics for the Company as a whole to make decisions about allocating resources and assessing financial performance. Accordingly, management has determined that there is only one reportable segment. The CODM assesses performance for the single reportable segment and decides how to allocate resources based on net loss. The measure of segment assets is reported on the balance sheet as total assets. Reclassifications Certain prior period presentation and disclosures were reclassified to ensure comparability with current period presentation. Specifically, costs associated with packaging services, warehousing services and merchant fees we reclassified from cost of sales to selling, general and administrative expenses for the year ended March 31, 2025. Accordingly, the Company reclassified $ 3,211 of cost of sales to selling, general and administrative expenses on the accompanying consolidated statements of operations and comprehensive loss for the year ended March 31, 2024 to conform to the current period presentation. The reclassifications have not changed the results of operations of the prior period. F- 14 Recent Accounting Pronouncements, adopted ASU 2023-07, Segment Reporting: Improvements to Reportable Segment Disclosure (“ASU 2023-07”) expands public entities’ segment disclosures primarily by requiring disclosure of significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit or loss, an amount and description of its composition for other segment items, and interim disclosures of a reportable segment’s profit or loss and assets. The guidance is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. The amendments are required to be applied retrospectively to all prior periods presented in an entity’s financial statements. The Company adopted the guidance effective March 31, 2025 for the fiscal year beginning April 1, 2024. There was no impact on the Company’s reportable segments identified and additional required disclosures have been included in these financial statements (see Note 16, Segment Reporting). Recent Accounting Pronouncements, not yet adopted ASU 2024-01, Compensation-Stock Compensation (Topic 718): Scope Application of Profits Interest and Similar Awards (“ASU 2024-01”) introduces updates to accounting standards related to the classification and measurement of financial instruments under ASC 320. The update primarily focuses on clarifying guidance for equity securities, debt instruments, and other financial assets, particularly in the areas of fair value measurement and impairment recognition. It aims to improve consistency and comparability in the reporting of financial instruments by refining the criteria for classifying securities and enhancing the methodology for recognizing and measuring impairments. ASU 2024- 01 also mandates additional disclosures to provide greater transparency around the valuation techniques and assumptions used in determining the fair value of financial instruments. The update is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. The Company is currently evaluating the impact of this ASU on its financial statements and disclosures. ASU 2024-02, Codification Improvements-Amendments to Remove References to the Concepts Statements (“ASU 2024-02”) updates accounting standards for revenue recognition, lease accounting, and impairment of long-lived assets. ASU 2024-02 provides enhanced guidance for estimating variable consideration, accounting for contract modifications, determining lease terms, and simplifying impairment testing for long-lived assets. It also introduces increased disclosure requirements for financial instruments and derivatives. ASU 2024-02 is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. ASU 2024-02 is not expected to have a material effect on the Company’s financial statements ASU 2024-03, Disaggregation of Income Statement Expenses (“DISE”) (“ASU 2024-03”) requires disclosures about specific types of expenses included in the expense captions presented on the face of the income statement as well as disclosure about selling expenses. ASU 2024-03 is effective for fiscal years beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact of this ASU on its financial statements and disclosures. ASU 2023-06, Disclosure Improvements: Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative (“ASU 2023-06”) incorporates several disclosure and presentation requirements currently residing in SEC Regulation S-X and S-K into the ASC. The amendments are applied prospectively and are effective when the SEC removes the related requirements from Regulation S-X and S-K. Any amendments the SEC does not remove by June 30, 2027 will not be effective. Early adoption is prohibited. The Company is currently evaluating the impact of this ASU on its financial statements and disclosures. ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”), include amendments that further enhance income tax disclosures, primarily through disaggregation of specific rate reconciliation categories and income taxes paid by jurisdiction. The amendments are effective for annual periods beginning after December 15, 2024, with early adoption permitted, and may be applied prospectively or retrospectively. The Company is currently evaluating the impact of this ASU to determine the impact on the Company’s disclosures. 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, NET The following table details the primary categories of inventories for the periods presented. SCHEDULE OF INVENTORY March 31, 2025 March 31, 2024 Finished goods $ 3,354 $ 2,680 Raw materials 807 721 Finished goods on consignment 363 205 Goods in transit 32 14 Total inventories 4,556 3,620 Inventory reserve ( 2,989 ) ( 1,390 ) Total inventories, net $ 1,567 $ 2,230 4. PREPAID AND OTHER CURRENT ASSETS The following table details the primary categories of prepaid and other current assets for the periods presented. SCHEDULE OF PREPAID AND OTHER CURRENT ASSETS March 31, 2025 March 31, 2024 Deposits and prepayments $ 1,621 $ 436 Marketing services 578 - Unbilled accounts receivable 147 - Other receivables 466 306 Total prepaid and other current assets $ 2,812 $ 742 F- 15 5. PROPERTY AND EQUIPMENT Property and equipment consisted of the following for the periods presented: SCHEDULE OF PROPERTY AND EQUIPMENT March 31, 2025 March 31, 2024 Furniture and fixtures $ 178 $ 177 Office equipment 58 57 Leasehold improvements 29 29 Software and website development 2,220 1,886 Computer equipment 140 121 Property and equipment, gross 2,625 2,270 Accumulated depreciation ( 2,142 ) ( 1,768 ) Property and equipment, net $ 483 $ 502 Depreciation expense related to property and equipment was $ 342 and $ 555 for the years ended March 31, 2025 and 2024, respectively, and is included as a component of selling, general and administrative expenses on the accompanying consolidated statements of operations and comprehensive loss. 6. LEASES The Company has obligations under operating leases for its offices. As of March 31, 2025 and 2024, the remaining 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 lease expenses 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, 2025 March 31, 2024 Lease expense Year Ended March 31, 2025 Year Ended March 31, 2024 Net lease expense: Operating lease expense $ 110 $ 299 Total lease expense $ 110 $ 299 Weighted-average remaining lease term - Years 0.53 1.53 Weighted-average discount rate 5.0 % 5.0 % Rent expense for the fiscal years ended March 31, 2025 and 2024 was $ 894 and $ 479 , respectively (including short term and other rentals). F- 16 SCHEDULE OF FUTURE MATURITY OF LEASE LIABILITIES Maturity of lease liabilities March 31, 2025 March 31, 2024 Within one year $ 48 $ 109 Within one to two years - 45 Total lease payments 48 154 Discount rate ( 4 ) ( 9 ) Present value of lease liabilities $ 44 $ 145 7. ACCRUED EXPENSES The following table details the primary categories of accrued expenses for the periods presented. SCHEDULE OF ACCRUED EXPENSES March 31, 2025 March 31, 2024 Accrued expenses $ 472 $ 471 Accrued payroll and payroll taxes 1,207 - Severance 414 531 Indirect taxes 1,254 1,040 Returns provision 594 298 Accrued import duties 228 294 Merchant credit 64 63 Total $ 4,233 $ 2,697 8. DEBT Short-Term Borrowings During the year ended March 31, 2025, the Company entered into seven separate business loan and security agreements (the “Term Loans”) with a lender for short-term loans to be provided by the lender, or the lender’s assignees (collectively, the “Lenders”) and mature 30-weeks from the date the amounts are borrowed. No amount of repaid borrowings may be reborrowed. The Company borrowed under seven short-term borrowing arrangements during the year ended March 31, 2025, borrowing a gross amount of $ 8,658 , net of fees of $ 2,866 which was recorded as a debt discount and is being amortized over the term of the agreement. During the year under March 31, 2025, the Company made total repayments of $ 5,742 . The company amortized $ 1,801 of the debt discount to interest expense and realized a cancelled debt discount of $ 179 related as an early payment discount of the notes for the same amount resulting unamortized debt discount balance of $ 887 . As of March 31, 2025, the Company had outstanding borrowings of $ 2,738 and an unamortized debt discount of $ 887 , resulting in net balance of $ 1,851 . As of March 31, 2025, the Company has outstanding borrowings under four agreements that require weekly payments of principal and interest totaling $ 53 , $ 34 , $ 71 , and $ 59 which have a remaining term of one week, eight weeks, thirteen weeks, and twenty-seven weeks, respectively. If an event of default, as defined in the agreement, occurs, the Company must make a mandatory prepayment to the Lenders in an amount equal to the sum of (i) all outstanding principal plus accrued and unpaid interest and (ii) a prepayment fee equal to the amount of interest that would be paid through the maturity date (the “Prepayment Fee”) plus (iii) all other obligations that are due and payable, including increased interest of 5.0 %. The Company has the right to make a full or partial prepayment of any or all obligations, but is obligated to pay a make-whole payment equal to the Prepayment Fee. Use of proceeds is limited to the repayment of other obligations to one of the Lenders and for general business requirements. The term loans are secured by collateral of the company that consists of all properties, rights and assets of the Company. Trade Finance Facility 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 a financial institution that matures in June 2025. The trade facility agreement was entered into in June 2022 and subsequently amended since with the most recent amendment in August 2024. As of March 31, 2025 and 2024, the outstanding balance under the trade finance facility was $ 2,495 and $ 0 , respectively, and the Company had a limit on the trade finance facility of $ 2,700 and $ 5,000 , respectively. As of March 31, 2025, there were no outstanding pledged letters of credit by HSBC. The Company is permitted to draw on the trade finance facility agreement to the extent that there is a deposit made to a specified account with the financial institution. The trade finance facility, as amended in August 2024, provides for (a) import facilities up to $ 2,700 and $ 5,000 as of March 31, 2025 and 2024, respectively, with repayment due 120-days from the draw, and (b) post-shipment buyer loans up to $ 1,800 and $ 800 as of March 31, 2025 and 2024, respectively, with repayment due 90-days from the draw. The Company’s ability to draw on the trade finance facility is subject to terms per the agreement, which include verification that the Company received the products from suppliers, among other requirements. The financial institution reserved the right to demand repayment at any time. A commission fee equal to 0.25 % and 0.0625 % will be charged on the first $ 50 and balances in excess of $ 50 respectively, drawn under the trade finance facility. For drawings in Hong Kong dollars, the interest rate equals the Hong Kong Interbank Offered Rate (“HIBOR”) plus 3.0 % ( 6.72 % at March 31, 2025), and for drawings in U.S. dollars, the interest rate equals the Secured Overnight Financing Rate (“SOFR”) plus 3.3 % ( 7.71 % at March 31, 2025). As of March 31, 2025, the trade finance facility was secured by a personal guarantee of $ 4,000 from the chairman of the Company’s board of directors and a requirement for a cash deposit from PMA equal to 50.0 % of the limit of the trade finance facility, or $ 1,350 . As of March 31, 2025, the cash deposit associated with the trade finance facility agreement was $ 1,350 and is recorded as restricted cash on the accompanying consolidated balance sheets. The $ 2,495 outstanding under the trade finance facility as of March 31, 2025 was repaid in full during June 2025. F- 17 9. CONVERTIBLE DEBT OBLIGATIONS 2021 and 2022 Debt Financings 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 8.0 % 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 for gross proceeds of $ 4,000 , less $ 531 of debt issuance costs, that rank pari passu to the 2021 Debt Financing, at an 8.0 % 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 the Company. 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. 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). Upon conversion of the convertible debt, the unamortized balance of debt discount of $ 492 was charged to interest expense. 2024 Debt Financing In December 2024, the Company entered into a convertible secured promissory note (“2024 Debt Financing”) whereby the Company completed convertible debt financing (“2024 Debt Financing”), from one investor, for gross proceeds of $ 2,000 , to provide working capital for its operations. The Company’s convertible debt obligations are secured by a security interest over the assets of the Company. The 2024 Debt Financing matures on December 6, 2025 . The 2024 Debt Financing has the following features: Conversion rights - The investor has the right, but not the obligation, to convert any portion of the outstanding and unpaid principal and accrued interest into shares of common stock at the conversion price of $ 1.00 . Interest – The 2024 Debt Financing bears interest of 15.0 % per annum. Exchange Cap – The lender shall not have the right to convert any portion of the 2024 Debt Financing to the extent that after giving effect to such conversion the lender, together with any affiliate, would beneficially own in excess of 4.99 % (which may be increased to 9.99 % at the investor’s sole discretion) of the number of common shares outstanding immediately after giving effect to such conversion or receipt of shares as payment of interest. Additionally, the Company shall not issue any common shares upon conversion of the 2024 Debt Financing, or otherwise, if the issuance of such common shares would exceed the aggregate number of common shares that the Company may issue in a transaction in compliance with the Company’s obligations under the rules or regulations of the NYSE, unless approved by the Company’s stockholders. Event of default – the unpaid principal amount of the 2024 Debt Financing and any accrued but unpaid interest becomes immediately due in payable if an Event of Default, as defined in the 2024 Debt Financing occurs. The investor has the right, but not the obligation, to convert at any time after an Event of Default at the conversion price of $ 1.00 . Prepayment feature - A prepayment prior to maturity to repay amounts outstanding under the 2024 Debt Financing is required equal to 33 % of net proceeds of an offering up to $ 10,000 of preferred stock after the first $ 2,000 in net proceeds. In March 2025, $ 2,000 in principal converted into an aggregate 2,000,000 shares of the Company’s common stock, at a conversion price of $ 1.00 (see Note 10). At the time of conversion, accrued but unpaid interest was of $ 93 included in the balance of accrued expenses in the accompanying consolidated balance sheet as of March 31, 2025, which was subsequently paid in cash to the lender. 10. STOCKHOLDERS’ EQUITY The Company is authorized to issue 110,000,000 shares of stock, of which 100,000,000 is designated as common stock and 10,000,000 is designated as preferred stock. Common stock The Company is authorized to issue 100,000,000 shares of common stock with a par value of $ 0.0001 per share, of which 19,291,000 and 15,653,449 were issued and outstanding as of March 31, 2025 and 2024, respectively. 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 . 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. Series A and Series B Convertible Preferred Stock On February 12, 2024, all outstanding shares of our Series A convertible preferred stock and the Series B convertible preferred stock were automatically converted into 5,323,782 and 1,189,998 , respectively, shares of common stock in connection with the closing of the initial public offering. Series AA Preferred Stock In March 2025, the Company designated a series of preferred stock as the 12.00 % Series AA Convertible Preferred Stock, par value of $ 0.0001 per share (the “Series AA Preferred Stock”) and authorized 1,800,000 shares of Series AA Preferred Stock. In March 2025, the Company entered into securities purchase agreements with twelve investors whereby the Company issued 924,921 shares of Series AA Preferred Stock at an original issue price of $ 5.8005 per share for gross proceeds of $ 5,365 , less $ 217 of issuance costs or total net proceeds of $ 5,148 . In connection with the securities purchase agreements, the Company entered into a registration rights agreement with the investors whereby the Company committed to file the registration statement to register for resale the shares of common stock issuable upon conversion of the Series AA Preferred Stock purchased by the investors pursuant to the securities purchase agreements no later than thirty days from the final closing date. Registration statement was filed on March 6, 2025 Additionally, the Company entered into a placement agency agreement with a placement agent in exchange for a cash fee of 6.0 % of the gross proceeds paid by investors introduced to the Company by the placement agent. Additionally, the Placement Agent received 56,676 warrants to purchase shares of common stock equal to 5.0 % of the shares of common stock issuable upon conversion of the Series AA Preferred Stock purchased by these investors (the “March 2025 Warrant”) at a per share price of $ 1.45 for a term of five years that may be exercised on a cash or cashless basis (see Note 12). The Series AA Preferred Stock holder and the March 2025 Warrant holder (collectively, the “March 2025 Investors”) shall not have the right to convert any portion of the Series AA Preferred Stock or March 2025 Warrant to the extent that after giving effect to such conversion the March 2025 Investors, together with any affiliates, would beneficially own in excess of 4.99 % (which may be increased to 9.99 % at the March 2025 Investor’s sole discretion) of the number of common shares outstanding immediately after giving effect to such conversion. Any increase to the beneficial ownership limitation will not be effective until the 61st day after notice is received by the Company. The March 2025 Warrant was determined to be an equity classified warrant and fair value was calculated as $ 31 using the Black-Scholes option-pricing model with the following assumptions: volatility of 55.0 %, risk-free rate of 3.98 %, annual dividend yield of 0.0 % and expected life of five years . F- 19 The rights, preferences, privileges and restrictions for the Series AA Preferred Stock are as follows: Dividends: Dividends on the Series AA Preferred Stock accrue daily and will be cumulative from the first day of the calendar month in which they are issued, and shall be payable monthly in arrears on the 30th day of each calendar month, when, as and if declared by the board of directors, at the rate of 12.0 % per annum of its original issue price, which is the equivalent to $ 0.6961 per annum per share. Liquidation preference : Upon (i) a liquidation or winding up of the Company, or (ii) a reorganization, merger or consolidation in which the holders of the voting securities of the Company do not retain at least a majority of the total outstanding voting securities, or (iii) a sale, lease, transfer, exclusive license or other disposition of all or substantially all the assets of the Corporation and its subsidiaries taken as a whole, the holders of Series AA Preferred Stock are entitled to receive a preferential payment per share equal to the greater of (a) $5.8005 plus declared but unpaid dividends, or (b) the amount per share that would have been payable had all shares of Series AA Preferred Stock been converted into Common Stock immediately prior to such event. Conversion: Shares of Series AA Preferred Stock are convertible into shares of common stock at the option of the holder, according to a conversion ratio equal to the original issue price of $ 5.8005 divided by the conversion price of $ 1.1601 , or $ 5.00 . The conversion price is subject to adjustment from time to time as specified in the March 2025 Certificate of Designation. Shares of Series AA Preferred Stock are convertible into shares of common stock automatically any time after the date six months after the original issuance date if the closing price of the common stock equals or exceeds 200.0% of the original issuance price, or $11.601, and the average trading column of the common stock exceeds 200,000 shares for at least twenty trading days in a period of thirty consecutive trading days. Redemption: The Series AA Preferred Stock are not redeemable at the option of the holder, on either a contingent or non-contingent basis. Voting: The Series AA Preferred Stock are non-voting in Company matters, with the exception that Series AA Preferred Stock holders are required to approve (i) any amendment, or other change, to the Company’s articles of incorporation that would have an adverse impact to the Series AA Preferred Stock holders dividend rights, preferences or special rights and (ii) any increase to the authorized number of shares of Series AA Preferred Stock, or authorize or issuance shares of any class or series of Senior Stock or Parity Stock, both of which are defined in the March 2025 Certificate of Designation. The Series AA Convertible Preferred Stock has no stated maturity, is not subject to any sinking fund, and will remain outstanding indefinitely unless a holder chooses to convert the Series AA Preferred Stock into shares of our common stock, or we elect to automatically convert it into shares of our common stock. As of March 31, 2025, the Series AA Convertible Preferred Stock were convertible into 4,624,620 common shares. Shares Issued for Services During the year ended March 31, 2025, the Company issued 1,352,102 shares of restricted common stock to vendors for services rendered and to be rendered with a fair value of $ 1,488 . These shares of common stock were valued based on the market value of the Company’s common stock price at the issuance date or the date the Company entered into the agreement related to the issuance. During the year ended March 31, 2025, the Company amortized $ 910 of the value of the shares as the services were rendered and $ 578 of the remaining fair value of the shares was included as a prepaid asset as of March 31, 2025 (see Note 4). 11. STOCK-BASED COMPENSATION PLANS 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 2,519,750 unallocated shares available to grant from the 2021 Plan as of March 31, 2025. 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. The Company has granted stock options and time-based restricted stock units (“time-based RSUs”). Stock options granted to date generally have a four 4 -year vesting period and vest at a rate of 25 % each year on the anniversary date of the grant. Stock options generally expire on the earlier of ten years from the date of grant, or a specified period of time following termination. Time-based RSUs generally vest over a period of four years in accordance with the terms and conditions established by the board of directors, and are based on continued service. Time-based RSUs The fair value of time-based RSUs is determined using the closing price of the Company’s common stock on the date of grant, reduced by the present value of dividends not received during the vesting period. For the time-based RSUs granted during the years ended March 31, 2025 and 2024, the expected annual dividend yield was 0.0 %. A summary of time-based RSU activity is presented below: SCHEDULE OF TIME-BASED RSU ACTIVITY Weighted- Average Grant Date Shares Fair Value Outstanding at March 31, 2023 - - Granted 300,000 $ 4.10 Vested ( 75,000 ) 4.10 Outstanding at March 31, 2024 225,000 4.10 Granted 1,105,866 1.11 Vested ( 285,449 ) 3.31 Forfeited ( 445,417 ) 2.78 Outstanding at March 31, 2025 600,000 $ 0.99 The total stock compensation expense recognized related to vesting of time-based RSUs for the years ended March 31, 2025 and 2024, was $ 619 and $ 429 , respectively, and was recognized on the accompanying consolidated statements of operations as a component of selling, general and administrative expenses. As of March 31, 2025, the total unrecognized stock-based compensation for time-based RSUs totaled $ 530 and are expected to be recognized over a weighted average period of 3.7 years. F- 20 Stock Options The fair value of the share option awards was estimated using the Black-Scholes method using the closing price of the Company’s common stock on the date of grant based on the following weighted-average assumptions: SCHEDULE OF FAIR VALUE OF SHARE OPTION AWARDS Year Ended Year Ended March 31, 2025 March 31, 2024 Expected option term 10.0 years 5.0 - 10.0 years Stock price volatility 138.4 % 129.1 % Risk free interest rate 2.09 % 1.74 - 1.81 % Expected annual dividend yield 0.0 % 0.0 % Forfeiture rate 29.9 % 25.7 % A summary of stock option activity is 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, 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 3.45 $ 595 Granted 688,194 2.15 Forfeited ( 790,000 ) 3.59 Exercised - - Outstanding at March 31, 2025 1,006,550 $ 2.42 2.85 $ 178 Vested and expected to vest March 31, 2025 874,724 $ 3.13 6.89 $ 178 Exercisable at March 31, 2025 562,910 $ 3.22 5.77 $ 178 The total stock compensation expense recognized related to vesting of stock options for the years ended March 31, 2025 and March 31, 2024 was $ 715 and $ 310 , respectively, and was recognized on the accompanying consolidated statements of operations as a component of selling, general and administrative expenses. As of March 31, 2025 the total unrecognized stock-based compensation for stock options was $ 1,035 and is expected to be recognized over a weighted average period of 2.85 years. F- 21 12. WARRANTS In connection with the IPO (see Note 1) and the securities purchase agreement (see Note 10), the Company issued stock purchase warrants to certain investors that permit the investor to acquire a fixed amount of shares of common stock at a per share price that ranges between $ 1.45 and $ 7.50 for a five year term that may be exercised on a cash or cashless basis. 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. All issued warrants were determined to be equity-classified at issuance, and as such, were recorded to additional-paid-in capital at such time. The following table summarizes the shares of the Company’s common stock issuable upon exercise of warrants outstanding at March 31, 2025: SCHEDULE OF COMMON STOCK ISSUABLE UPON EXERCISE OF WARRANTS OUTSTANDING Warrants Outstanding Exercise Price Number Outstanding Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price Underwriter Warrants $ 7.50 66,700 3.9 $ 7.50 March 2025 Warrant 1.45 56,676 5.0 1.45 $ 1.45 – 7.50 123,376 4.1 $ 6.65 The following table summarizes the shares of the Company’s common stock issuable upon exercise of warrants outstanding at March 31, 2024: Warrants Outstanding Exercise Price Number Outstanding Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price Underwriter Warrants $ 7.50 66,700 4.9 $ 7.50 A summary of warrant activity for the periods presented is as follows: SCHEDULE OF WARRANTS ACTIVITY Weighted- Average Exercise Warrants Price Outstanding at March 31, 2023 - $ - Granted 66,700 7.50 Outstanding at March 31, 2024 66,700 7.50 Granted 56,676 1.45 Outstanding at March 31, 2025 123,376 $ 6.65 F- 22 The Underwriter Warrants will expire on February 12, 2029 (see Note 10) and the March 2025 Warrants will expire on March 31, 2030 (see Note 10). As of March 31, 2025 the intrinsic value of the outstanding warrants was $ 8 . 13. INCOME TAXES Components of income tax (benefit) expense were as follows: SCHEDULE OF INCOME TAX BENEFIT EXPENSE March 31, 2025 March 31, 2024 Year Ended March 31, 2025 Year Ended March 31, 2024 Current $ - $ - Deferred - - Total income tax (benefit) expense $ - $ - The following is a reconciliation of the federal statutory rate to the Company’s effective income tax rate: SCHEDULE OF RECONCILIATION OF INCOME TAXES Year Ended March 31, 2025 Year Ended March 31, 2024 Year Ended March 31, 2025 Year Ended March 31, 2024 Statutory rate 21.0 % 21.0 % Change in valuation allowance ( 21.1 ) ( 13.9 ) Foreign tax differential ( 1.2 ) ( 1.2 ) Permanent differences 1.3 ( 5.9 ) Effective rate 0.0 % 0.0 % F- 23 The tax effects of temporary cumulative differences which give rise to deferred tax assets and liabilities are summarized as follows: SCHEDULE OF DEFERRED TAX ASSETS AND LIABILITIES March 31, 2025 March 31, 2024 Deferred tax liabilities: Fixed and intangible assets $ 175 $ 113 Inventory - - Total deferred tax liabilities 175 113 Deferred tax assets: Tax loss carryforward 10,284 7,312 Stock compensation expense 815 535 IPO expenses 163 163 Valuation allowance ( 11,087 ) ( 7,897 ) Total deferred tax assets 175 113 Deferred tax assets, net $ - $ - During the years ended March 31, 2025 and 2024, the Company recorded an increase in the valuation allowance of $ 3,190 and $ 1,449 , 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. Throughout the year ended March 31, 2025, 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 the years ended March 31, 2025 and 2024, the Company recorded a valuation allowance of 100 % of UK and Hong Kong losses. The Company is subject to US federal income tax, as well as income tax in multiple US state and local jurisdictions and a number of foreign jurisdictions. Returns for the years since fiscal year 2022 are still open based on statutes of limitation only. F- 24 14. COMMITMENTS AND CONTINGENCIES Notice from NYSE – On December 17, 2024 the Company received a notification from the NYSE American LLC (the “NYSE”) stating that the Company is not in compliance with the minimum stockholders’ equity requirements of Sections 1003(a)(ii) of the NYSE American Company Guide (the “Company Guide”) requiring stockholders’ equity of $ 4,000 or more if the Company has reported losses from continuing operations and/or net losses in three of the four most recent fiscal years. As of September 30, 2024, the Company had stockholders’ equity of approximately $ 2,700 and had losses in its three most recent fiscal years ended March 31, 2024. The Company is now subject to the procedures and requirements of Section 1009 of the Company Guide. The Company has until June 11, 2026 to regain compliance with the Company Guide. The Company submitted a plan of action to regain compliance with the Company Guide (the “Plan”) on January 10, 2025, which the NYSE accepted on March 4, 2025. Accordingly, the Company will be able to continue its listing during the Plan period and will be subject to periodic reviews including quarterly monitoring for compliance with the Plan until it has regained compliance. The notification and Plan acceptance has no immediate effect on the listing or trading of the Company’s common stock on the NYSE. The NYSE’s acceptance of the Company’s Plan does not affect the Company’s business, operations or reporting requirements with the U.S. Securities and Exchange Commission. 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 flow . 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. 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 monetary damages, non-monetary relief, such as an injunction to end the alleged unlawful practices, and attorneys’ fees and costs on behalf of the Aspen Skiing Company. The Company entered into a settlement agreement with Aspen Skiing Company for a de minimis amount during August 2024. On May 14, 2025, we were named as a defendant in a lawsuit filed in the Superior Court of the State of California in and for the County of Los Angeles Central Judicial District by Amanda Archer and Archer Bytes LLC, a former public relations consultant for the Company. The complaint alleges breach of contract, and other claims and seeks specific damages of $ 600,000 and unspecified punitive damages. We believe the claims are entirely without merit and intend to vigorously defend the matter. On April 24, 2025, the Company’s former Chief Executive Officer (the “Former CEO”) commenced ACAS Early Conciliation proceedings (a mandatory step in the UK prior to filing a legal claim) alleging, among other things, unfair dismissal from his position. The Company has not yet been notified that the Former CEO has filed a legal claim with the UK Employment Tribunal. Capital commitments - The Company had $ 7,045 of purchase obligations as of March 31, 2025, related to purchase orders to factories for the manufacture of finished goods. Vendor lien on 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. As of March 31, 2025 and 2024, a lien has not been placed on the Company’s inventory in connection with this contract. 15. RELATED PARTY TRANSACTIONS Two directors of the Company provided consulting and advisory services for the Company totaling $ 185 and $ 324 for the years ended March 31, 2025 and 2024, respectively, and are included in selling, general and administrative expenses on the accompanying consolidated statement of operations and comprehensive loss. As of March 31, 2025 and 2024, there were no amounts owed to either director. Our trade finance facility (see Note 8) was secured by a standby documentary credit for $ 1,000 , which was secured by a guarantee from a company controlled by the Chairman of our board of directors (the “Chairman”) from June 2023 through January 2024. The guarantee accrued interest of 8 % per annum from June 2023 through November 2023 and interest of 10.0 % from November 2023 through January 2024, payable by the Company. Interest expense for the year ended March 31, 2024 was $ 56 . The Chairman has provided a $ 4,000 personal guarantee for the Company’s trade finance facility. The guarantee is a pay-on-demand guarantee securing the Company’s obligations under the trade finance facility, including interest and bank costs, fees and expenses, up to $ 4,000 . The Chairman does not receive consideration in exchange for the personal guarantee. In March 2025, the Company entered into securities purchase agreements with a company controlled by the Chairman whereby the Company issued 344,797 shares of Series AA Preferred Stock at an original issue price of $ 5.8005 per share for gross proceeds of $ 2,000 . F- 25 16. SEGMENT REPORTING The following table includes additional information about reported segment revenue, significant segment expenses and segment measure of profitability: SCHEDULE OF SEGMENT REVENUE, SIGNIFICANT SEGMENT EXPENSES AND SEGMENT MEASURE OF PROFITABILITY Year ended March 31, 2025 Year ended March 31, 2024 Revenue, net $ 21,501 $ 24,443 Less: Significant segment expenses - - Cost of Revenue 11,072 12,001 Selling expense 3,916 4,077 General and administrative 14,501 10,516 Marketing and advertising 3,540 4,784 Non-cash compensation 2,244 740 Other segment items (1) 2,167 1,047 Net loss $ ( 15,939 ) $ ( 8,722 ) (1) Includes interest expense, foreign currency transactions (loss) gain, and other income. See Note 2 for revenue by geographic location. Long-lived assets, excluding other non-current assets, by geography are summarized as follows: SCHEDULE OF LONG-LIVED ASSETS, EXCLUDING OTHER NON-CURRENT ASSETS, BY GEOGRAPHY Year ended March 31, 2025 Year ended March 31, 2024 United Kingdom $ 478 $ 547 Hong Kong 49 98 Total long-lived assets $ 527 $ 645 17. SUBSEQUENT EVENTS The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the consolidated financial statements were issued. Based upon this review, other than as described below or within these consolidated financial statements, the Company did not identify any other subsequent events that would have required adjustment or disclosure in the consolidated financial statements. During May 2025, the Company entered into a business loan and security agreement with the same lender and substantially the same terms as the Term Loans, borrowing gross proceeds of $ 1,400 , net of fees of $ 70 . Thirty weekly payments of principal and interest totaling $ 66 commence in June 2025. During May 2025, the Company entered into a consulting agreement for business advisory services under which it issued 100,000 shares of common stock at a fair value of $ 62 , as determined by the closing price on the day of issuance. During May 2025, the Company entered into a promissory note (the “May 2025 Note”) with a lender controlled by the Chairman of the Company’s board of directors to borrow $ 500 . The May 2025 Note matures on December 31, 2025 and permits the Company to prepay the note in full without penalty at any time. If an Event of Default, as defined in the May 2025 Note, occurs, the outstanding principal and accrued interest becomes due and payable immediately. In May 2025 we entered two agreements with lenders in which we borrowed gross proceeds of $ 1,900 , $ 500 of which were pursuant to a note with an entity controlled by the Chairman of our board of directors. Refer to Note 17 to our consolidated financial statements included in Item 8 of this Form 10-K. On June 30, 2025, the Company closed a public offering of 10,000,000 shares of its common stock at an offering price of $ 0.30 per share (the “Offering”), pursuant to its registration statement on Form S-3 (File No. 333-285612). The Offering generated gross proceeds of $ 3.0 million. After underwriting discounts, non-accountable expenses, legal expense reimbursement, and other offering-related costs, the Company received net proceeds of approximately $ 2,686,850 . In connection with the Offering, the Company issued to ThinkEquity LLC, the representative of the underwriters, warrants to purchase up to 500,000 shares of common stock at an exercise price of $ 0.38 per share. These warrants are exercisable beginning on the date of issuance and expire five years thereafter. The underwriters were also granted a 45-day option to purchase up to an additional 1,500,000 shares of common stock and/or pre-funded warrants to cover over-allotments, if any. As of the date of this filing, the over-allotment option has not been exercised. Concurrently with the closing off the Offering, the May 2025 Note was extinguished through the issuance of 1,692,694 shares of the Company’s common stock at a per share price of $ 0.30 . F- 26 INDEX TO EXHIBITS The exhibits listed below are filed as part of this Report on Form 10-K, or are incorporated herein by reference, in each case as indicated below. Exhibit Incorporated by Reference Number Description Form File No. Exhibit Filing Date 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 3.3 Certificate of Designations of 12.00% Series AA Convertible Preferred Stock. 8-K 001-41930 3.1 April 2, 2025 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 4.3 Form of Convertible Promissory Note for 2021 Debt Financing S-1 333-274913 4.3 November 6, 2023 4.4 Form of Amendment No. 1 to Convertible Promissory Note for 2021 Debt Financing S-1 333-274913 4.4 November 6, 2023 4.5 Form of Amendment No. 2 to Convertible Promissory Note for 2021 Debt Financing S-1 333-274913 4.5 November 6, 2023 4.6 Form of Amendment No. 3 to Convertible Promissory Note for 2021 Debt Financing S-1 333-274913 4.6 January 18, 2024 4.7 Form of Convertible Promissory Note for 2022 Debt Financing S-1 333-274913 4.6 November 6, 2023 4.8 Form of Amendment No. 1 to Convertible Promissory Note for 2022 Debt Financing S-1 333-274913 4.7 November 6, 2023 4.9 Form of Amendment No. 2 to Convertible Promissory Note for 2022 Debt Financing S-1 333-274913 4.9 January 18, 2024 4.10 Form of Convertible Secured Note dated December 6, 2024 8-K 001-41930 10.2 December 12, 2024 4.11 Form of Placement Agent Warrant 8-K 001-41930 4.1 April 2, 2025 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 62 Exhibit Incorporated by Reference Number Description Form File No. Exhibit Filing Date 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 10.9+ Employment Agreement between Perfect Moment (UK) Limited and Mark Buckley S-1 333-274913 10.1 November 6, 2023 10.10+ Employment Agreement between Perfect Moment (UK) Limited and Jane Gottschalk S-1 333-274913 10.3 November 6, 2023 10.11+ Consulting Agreement between Perfect Moment Asia Limited and Max Gottschalk S-1 333-274913 10.4 November 6, 2023 10.12+ Board Member Agreement between Perfect Moment Asia Limited and Tracy Barwin S-1 333-274913 10.6 November 6, 2023 10.13+ 2021 Equity Incentive Plan and forms of award agreements thereunder S-1 333-274913 10.8 November 6, 2023 10.14+ Amendment No. 1 to 2021 Equity Incentive Plan S-1 333-274913 10.10 January 26, 2024 10.15+ Independent Director Agreement between Perfect Moment Ltd. and Tim Nixdorff S-1 333-274913 10.23 January 18, 2024 10.16 Facility Letter Agreement between Perfect Moment Asia Limited and HSBC S-1 333-274913 10.31 November 6, 2023 10.17 Amendment to Facility Letter Agreement, dated April 11, 2023, between Perfect Moment Asia Limited and HSBC S-1 333-274913 10.32 November 6, 2023 10.18 Amendment to Facility Letter Agreement, dated July 10, 2023, between Perfect Moment Asia Limited and HSBC S-1 333-274913 10.33 November 6, 2023 10.19 UBS Switzerland AG Standby Documentary Credit S-1 333-274913 10.34 November 6, 2023 10.20 Charge over Securities and Deposits between Perfect Moment Asia Limited and HSBC S-1 333-274913 10.35 November 6, 2023 10.21 Guarantee of Perfect Moment Limited S-1 333-274913 10.36 November 6, 2023 10.22 Share Registration Agreement S-1 333-274913 10.44 January 26, 2024 10.23 Form of Lock-Up Agreement S-1 333-274913 10.45 January 26, 2024 10.24 Perfect Moment Ltd. Enterprise Management Incentive Share Option Agreement with Negin Yeganegy S-8 333-277335 99.3 February 23, 2024 10.25 Excerpts from the Settlement Agreement, dated October 26, 2022, by and between Perfect Moment UK Limited and Negin Yeganegy, relating to the Perfect Moment Ltd. Enterprise Management Incentive Share Option Agreement with Negin Yeganegy S-8 333-277335 99.4 February 23, 2024 10.26 Subordinated Business Loan and Security Agreement dated July 25, 2024 8-K 001-41930 10.1 August 29, 2024 10.27 Subordinated Business Loan and Security Agreement dated August 23, 2024 8-K 001-41930 10.2 August 29, 2024 63 Exhibit Incorporated by Reference Number Description Form File No. Exhibit Filing Date 10.28 Standard Merchant Cash Advance Agreement dated September 25, 2024 10-Q 001-41930 10.3 November 14, 2024 10.29 Subordinated Business Loan and Security Agreement dated September 30, 2024 10-Q 001-41930 10.4 November 14, 2024 10.30 Business Loan and Security Agreement dated October 23, 2024 10-Q 001-41930 10.5 November 14, 2024 10.31 Business Loan and Security Agreement dated November 24, 2024 10-Q 001-41930 10.3 February 14, 2025 10.32 Form of Convertible Secured Note Purchase Agreement dated December 6, 2024 8-K 001-41930 10.1 December 12, 2024 10.33 Licence Agreement dated January 10, 2024 1-A 024-12548 6.32 December 16, 2024 10.34+ Consulting Agreement between Perfect Moment (UK) Limited and Vittorio Giacomelli 8-K 001-41930 10.1 February 6, 2025 10.35+ Employment Agreement between Perfect Moment (UK) Limited and Chath Weerasinghe 8-K 001-41930 10.2 February 6, 2025 10.36+ Restricted Stock Unit Agreement dated February 3, 2025, between the Company and Chath Weerasinghe 8-K 001-41930 10.3 February 6, 2025 10.37+ Amendment to Contract of Employment between Perfect Moment (UK) Limited and Jane Gottschalk 8-K 001-41930 10.4 February 6, 2025 10.38 Form of Securities Purchase Agreement, dated March 28, 2025, between the Registrant and the investors party thereto. 8-K 001-41930 10.1 April 2, 2025 10.39 Form of Registration Rights Agreement, dated March 28, 2025, between the Registrant and the investors party thereto. 8-K 001-41930 10.2 April 2, 2025 10.40 Placement Agency Agreement, dated March 28, 2025, between the Registrant and the Placement Agent 8-K 001-41930 10.3 April 2, 2025 19.1 Insider Trading Policy 21.1 Subsidiaries of the Company S-1 333-274913 21.1 January 18, 2024 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. 64 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: June 30, 2025 By: /s/ Jane Gottschalk Jane Gottschalk President, Chief Creative Officer and Director (Principal Executive Officer) Date: June 30, 2025 By: /s/ Chath Weerasinghe Chath Weerasinghe 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: June 30, 2025 By: /s/ Jane Gottschalk Jane Gottschalk President, Chief Creative Officer and Director (Principal Executive Officer) Date: June 30, 2025 By: /s/ Chath Weerasinghe Chath Weerasinghe Chief Financial Officer (Principal Financial and Accounting Officer) Date: June 30, 2025 By: /s/ Andre Keijsers Andre Keijsers Director Date: June 30, 2025 By: /s/ Berndt Hauptkorn Berndt Hauptkorn Director Date: June 30, 2025 By: /s/ Max Gottschalk Max Gottschalk Director Date: June 30, 2025 By: /s/ Tracy Barwin Tracy Barwin Director Date: June 30, 2025 By: /s/ Tim Nixdorff Tim Nixdorff Director 65