NaturalShrimp Inc 10-Q

Item 1. Financial Statements NATURALSHRIMP INCORPORATED and subsidiaries CONDENSED Consolidated Balance Sheets June 30, 2024 March 31, 2024 ASSETS Current assets Cash $ 4,978 $ 115,525 Accounts receivable 22,165 27,450 Inventory 60,352 68,510 Prepaid expenses 161,473 169,650 Total current assets 248,968 381,135 Fixed assets, net 12,845,980 13,301,245 Other assets Patents, net 5,781,000 5,878,500 License Agreement, net 7,792,376 8,062,376 Right of Use asset 69,717 73,449 Deposits 20,633 20,633 Total other assets 13,663,726 14,034,958 Total assets $ 26,758,674 $ 27,717,338 LIABILITIES, MEZZANINE AND STOCKHOLDERS’ DEFICIT Current liabilities Accounts payable $ 3,684,727 $ 3,495,689 Accrued interest 107,435 107,435 Accrued interest - related parties 264,343 254,593 Accrued interest 264,343 254,593 Other accrued expenses 1,842,878 1,743,799 Accrued expenses - related parties 1,258,759 1,116,107 Short-term note and lines of credit 19,817 19,817 Notes payable 460,622 553,322 Restructured Senior note payable 27,690,000 27,120,000 Restructured August note payable 2,790,000 2,640,000 Notes payable - related parties 880,412 880,412 Notes payable 880,412 880,412 Dividends payable 619,896 544,800 Warrant liability 19,000 24,000 Lease liability, current 28,560 28,560 Total current liabilities 39,666,449 38,528,534 Lease liability, non-current 38,552 43,325 Total liabilities 39,705,001 38,571,859 Commitments and contingencies (Note 11) - - Series E Redeemable Convertible Preferred stock, $ 0.0001 par value, 10,000 shares authorized, 1,656 and 1,670 shares issued and outstanding at June 30, 2024 and March 31, 2024, respectively 1,987,200 1,977,900 Series F Redeemable Convertible Preferred stock, $ 0.0001 par value, 750,000 shares authorized, 750,000 shares issued and outstanding at June 30, 2024 and March 31, 2024, respectively 43,612,000 43,612,000 Series G Redeemable Convertible Preferred stock, $ 0.0001 par value, 10,000 shares authorized, 645 and 445 shares issued and outstanding at June 30, 2024 and March 31, 2024, respectively 671,000 432,000 Temporary equity, value 671,000 432,000 Stockholders’ deficit Series A Convertible Preferred stock, $ 0.0001 par value, 5,000,000 shares authorized, 5,000,000 shares issued and outstanding at June 30, 2024 and March 31, 2024, respectively 500 500 Common stock, $ 0.0001 par value, 1,400,000,000 shares authorized, 1,192,874,082 and 1,116,482,063 shares issued and outstanding at June 30, 2024 and March 31, 2024, respectively 119,351 111,712 Additional paid in capital 127,046,949 126,468,749 Stock to be issued 390,024 390,024 Subscription receivable ( 56,250 ) ( 56,250 ) Accumulated deficit ( 186,717,101 ) ( 183,791,156 ) Total stockholders’ deficit ( 59,216,527 ) ( 56,876,421 ) Total liabilities, mezzanine and stockholders’ deficit $ 26,758,674 $ 27,717,338 The accompanying footnotes are an integral part of these condensed consolidated financial statements. 3 NATURALSHRIMP INCORPORATED CONDENSED Consolidated STATEMENTS OF OPERATIONS (Unaudited) June 30, 2024 June 30, 2023 For Three Months Ended June 30, 2024 June 30, 2023 Sales $ 36,618 $ 205,872 Cost of sales 34,732 49,741 Net revenue 1,886 156,131 Operating expenses: General and administrative 1,104,485 1,298,451 Facility operations 158,535 358,258 Depreciation 434,908 434,809 Amortization 367,500 367,500 Total operating expenses 2,065,428 2,459,018 Net loss from operations ( 2,063,542 ) ( 2,302,887 ) Other income (expense): Interest expense ( 3,899 ) ( 2,713 ) Interest expense - related parties ( 9,750 ) ( 6,250 ) Interest expense ( 9,750 ) ( 6,250 ) Change in fair value of warrant liability 5,000 50,000 Change in fair value of restructured notes payable ( 720,000 ) 137,634 Extension fee - ( 180,000 ) (Loss) gain on sale of machinery and equipment ( 10,357 ) 5,785 Total other income (expense), net ( 739,006 ) 4,456 Loss before income taxes ( 2,802,548 ) ( 2,298,431 ) Provision for income taxes - - Net loss ( 2,802,548 ) ( 2,298,431 ) Accretion on Preferred shares ( 48,300 ) - Dividends ( 75,097 ) ( 404,825 ) Net loss available for common stockholders $ ( 2,925,945 ) $ ( 2,703,256 ) Loss per share (Basic and Diluted) $ ( 0.00 ) $ ( 0.00 ) WEIGHTED AVERAGE SHARES OUTSTANDING (Basic and Diluted) 1,167,281,937 839,745,626 The accompanying footnotes are an integral part of these condensed consolidated financial statements. 4 NATURALSHRIMP INCORPORATED CONDENSED Consolidated STATEMENT of CHANGES IN SHAREHOLDERS’ DEFICIT F or the three months ended June 30, 2024 and 2023 (Unaudited) Shares Amount Shares Amount in Capital issued receivable deficit deficit Series A Preferred stock Common stock Additional paid Stock to be Subscription Accumulated Total stockholders’ Shares Amount Shares Amount in Capital issued receivable deficit deficit Balance March 31, 2024 5,000,000 $ 500 1,116,482,063 $ 111,712 $ 126,468,749 $ 390,024 $ ( 56,250 ) $ ( 183,791,156 ) ( 56,876,421 ) Issuance of common shares under financing agreement - - 66,392,019 6,639 479,200 - - - 485,839 Shares issued upon exchange of Partitioned Note - - 10,000,000 1,000 99,000 - - - 100,000 Accretion of Series E Preferred stock - - - - - - - ( 9,300 ) ( 9,300 ) Accretion on Series G Preferred stock - - - - - - - ( 39,000 ) ( 39,000 ) Dividends payable on Preferred stock - - - - - - - ( 75,097 ) ( 75,097 ) Net loss - - - - - - - ( 2,802,548 ) ( 2,802,548 ) Balance June 30, 2024 5,000,000 $ 500 1,192,874,082 $ 119,351 $ 127,046,949 $ 390,024 $ ( 56,250 ) $ ( 186,717,101 ) ( 59,216,527 ) Balance March 31, 2023 5,000,000 $ 500 803,123,748 $ 80,377 $ 121,156,733 $ 662,767 $ ( 56,250 ) $ ( 167,533,292 ) ( 45,689,165 ) Balance 5,000,000 $ 500 803,123,748 $ 80,377 $ 121,156,733 $ 662,767 $ ( 56,250 ) $ ( 167,533,292 ) ( 45,689,165 ) Common stock issued for legal settlement to NSH shareholders - - 863,110 86 272,657 ( 272,743 ) - - - Issuance of common shares under financing agreements - - 40,187,311 4,019 1,294,493 - - - 1,298,512 Conversion of Series E Preferred Shares to common stock - - 23,989,570 2,399 825,601 - - ( 350,825 ) 477,175 Dividends payable on Series E Preferred Shares - - - - - - - ( 54,000 ) ( 54,000 ) Common stock issued to consultants - - 100,000 10 4,690 - - - 4,700 Net loss - - - - - - - ( 2,298,431 ) ( 2,298,431 ) Balance June 30, 2023 5,000,000 $ 500 868,263,739 $ 86,891 $ 123,554,174 $ 390,024 $ ( 56,250 ) $ ( 170,236,548 ) ( 46,261,209 ) Balance 5,000,000 $ 500 868,263,739 $ 86,891 $ 123,554,174 $ 390,024 $ ( 56,250 ) $ ( 170,236,548 ) ( 46,261,209 ) The accompanying footnotes are an integral part of these condensed consolidated financial statements. 5 NATURALSHRIMP INCORPORATED CONDENSED Consolidated STATEMENTS OF CASH FLOWS (Unaudited) June 30, 2024 June 30, 2023 For Three Months Ended June 30, 2024 June 30, 2023 CASH FLOWS FROM OPERATING ACTIVITIES Net loss $ ( 2,802,548 ) $ ( 2,298,431 ) Adjustments to reconcile net loss to net cash used in operating activities Depreciation expense 434,908 434,809 Amortization expense 367,500 367,500 Change in fair value of warrant liability ( 5,000 ) ( 50,000 ) Change in fair value of restructured notes payable 720,000 ( 137,634 ) Financing costs 7,300 120,000 (Loss) gain on sale of machinery and equipment 10,357 ( 5,785 ) Shares issued for services - 4,700 Amortization of operating lease right-of-use assets 3,732 20,293 Changes in operating assets and liabilities: Accounts receivable 5,285 ( 19,004 ) Inventory 8,158 ( 20,932 ) Prepaid expenses 8,177 32,462 Deferred offering costs - ( 55,503 ) Accounts payable 189,038 35,636 Other accrued expenses 99,079 12,032 Accrued expenses - related parties 142,652 171,690 Accrued interest - related parties 9,750 6,250 Operating lease liabilities ( 4,773 ) ( 18,981 ) Cash used in operating activities ( 806,385 ) ( 1,400,898 ) CASH FLOWS FROM INVESTING ACTIVITIES Cash paid for fixed assets - ( 39,308 ) Cash received for sale of machinery and equipment 10,000 19,000 Cash provided by (used in) investing activities 10,000 ( 20,308 ) CASH FLOWS FROM FINANCING ACTIVITIES Payments of notes payable - ( 24,000 ) Proceeds from sale of stock 485,838 1,298,512 Proceeds from sale of Series G Preferred Shares 200,000 - Cash provided by financing activities 685,838 1,274,512 NET CHANGE IN CASH ( 110,547 ) ( 146,694 ) CASH AT BEGINNING OF PERIOD 115,525 216,465 CASH AT END OF PERIOD $ 4,978 $ 69,771 INTEREST PAID $ 3,899 $ 7,472 Supplemental Disclosure of Non-Cash Investing and Financing Activities: Shares issued upon conversion of Preferred stock $ - 828,000 Shares issued upon exchange of Partitioned Note $ 100,000 - Dividends on Series E Preferred stock $ - $ 404,825 Dividends in kind issued $ 75,097 $ 516,000 Shares issued/to be issued, for legal settlement $ - $ 272,743 The accompanying footnotes are an integral part of these condensed consolidated financial statements. 6 NATURALSHRIMP INCORPORATED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE THREE MONTHS ENDED JUNE 30, 2024 (Unaudited) NOTE 1 – NATURE OF THE ORGANIZATION AND BUSINESS Nature of the Business NaturalShrimp Incorporated (“NaturalShrimp” or the “Company”), a Nevada corporation, is a biotechnology company and has developed a proprietary technology that allows it to grow Pacific White shrimp (Litopenaeus vannamei, formerly Penaeus vannamei) in an ecologically controlled, high-density, low-cost environment, and in fully contained and independent production facilities. The Company’s system uses technology which allows it to produce a naturally-grown shrimp “crop” weekly and accomplishes this without the use of antibiotics or toxic chemicals. The Company has developed several proprietary technology assets, including a knowledge base that allows it to produce commercial quantities of shrimp in a closed system with a computer monitoring system that automates, monitors and maintains proper levels of oxygen, salinity and temperature for optimal shrimp production. The Company’s production facilities are located in La Coste, Texas and Webster City, Iowa. The Company has three wholly-owned subsidiaries including NaturalShrimp USA Corporation (“NSC”) and NaturalShrimp Global, Inc. (“NS Global”) and Natural Aquatic Systems, Inc. (“NAS”), and owns 51% of NaturalShrimp/Hydrenesis LLC, a Texas limited liability company. Going Concern The accompanying condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”), assuming the Company will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. For the three months ended June 30, 2024, the Company had a net loss available for common stockholders of approximately $ 2,926,000 . As of June 30, 2024, the Company had an accumulated deficit of approximately $ 186,717,000 and a working capital deficit of approximately $ 39,417,000 . These factors raise substantial doubt about the Company’s ability to continue as a going concern, within one year from the issuance date of this filing. The Company’s ability to continue as a going concern is dependent on its ability to raise the required additional capital or debt financing to meet short and long-term operating requirements. During the three months ended June 30, 2024, the Company received net cash proceeds of approximately $ 486,000 from the sale of common shares (See Note 8), and $ 200,000 from the sale of Series G Preferred stock. Subsequent to period end, the Company received approximately $ 42,000 for the sale of common shares and $ 100,000 from the sale of Series G Preferred stock (See Note 12). Management believes that private placements of equity capital will be needed to fund the Company’s long-term operating requirements. The Company may also encounter business endeavors that require significant cash commitments or unanticipated problems or expenses that could result in a requirement for additional cash. If the Company raises additional funds through the issuance of equity, the percentage ownership of its current shareholders could be reduced, and such securities might have rights, preferences or privileges senior to its common stock. Additional financing may not be available upon acceptable terms, or at all. If adequate funds are not available or are not available on acceptable terms, the Company may not be able to take advantage of prospective business endeavors or opportunities, which could significantly and materially restrict its operations. The Company continues to pursue external financing alternatives to improve its working capital position. If the Company is unable to obtain the necessary capital, the Company may be unable to develop its facilities and enter into production. 7 NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying unaudited condensed financial information as of and for the three months ended June 30, 2024 and 2023 has been prepared in accordance with US GAAP for interim financial information and with the instructions to Quarterly Report on Form 10-Q and Article 10 of Regulation S-X. In the opinion of management, such financial information includes all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation of our condensed consolidated financial position at such date and the condensed consolidated operating results and cash flows for such periods. Operating results for the three months ended June 30, 2024 are not necessarily indicative of the results that may be expected for the entire year or for any other subsequent interim period. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been omitted pursuant to the rules of the U.S. Securities and Exchange Commission (“SEC”). These condensed consolidated unaudited financial statements and related notes should be read in conjunction with our audited financial statements for the year ended March 31, 2024 included in the Company’s Annual Report on Form 10-K filed with the SEC on July 17, 2024. The condensed consolidated balance sheet at March 31, 2023 has been derived from the audited consolidated financial statements at that date but does not include all of the information and footnotes required by GAAP for complete financial statements. Consolidation The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, including NSC, NS Global and NAS, and owns 51% of NaturalShrimp/Hydrenesis LLC, a Texas limited liability company. All significant intercompany accounts and transactions have been eliminated in consolidation. Use of Estimates Preparing financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Basic and Diluted Earnings/Loss per Common Share Basic and diluted earnings or loss per share (“EPS”) amounts in the unaudited condensed consolidated financial statements are computed in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 260 – 10 “ Earnings per Share ”, which establishes the requirements for presenting EPS. Basic EPS is based on the weighted average number of shares of common stock outstanding. Diluted EPS is based on the weighted average number of shares of common stock outstanding and dilutive common stock equivalents. Basic EPS is computed by dividing net income or loss available to common stockholders (numerator) by the weighted average number of shares of common stock outstanding (denominator) during the period. As of the three months ended June 30, 2024, the Company had 5,000,000 Series A Convertible Preferred Stock which would be converted at the holder’s option into approximately 1,192,874,000 underlying common shares, 1,656 of Series E Redeemable Convertible Preferred shares whose approximately 5,678,000 underlying shares are convertible at the investors’ option at a fixed conversion price of $ 0.35 , 750,000 shares of Series F Preferred Stock which would be converted at the holders’ option into approximately 286,290,000 underlying common shares, 645 of Series G Redeemable Convertible Preferred shares whose approximately 387,000,000 underlying shares are convertible at the investors’ option at a conversion price based on the discounted market price of $ 0.002 and 18,573,116 warrants outstanding which were not included in the calculation of diluted EPS as their effect would be anti-dilutive. As of the three months ended June 30, 2023, the Company had 5,000,000 Series A Convertible Preferred Stock which would be converted at the holder’s option into approximately 868,264,000 underlying common shares, 1,500 of Series E Redeemable Convertible Preferred shares whose approximately 5,143,000 underlying shares are convertible at the investors’ option at a fixed conversion price of $ 0.35 , 750,000 shares of Series F Preferred Stock which would be converted at the holders’ option into approximately 208,383,000 underlying common shares, and 18,573,116 warrants outstanding which were not included in the calculation of diluted EPS as their effect would be anti-dilutive. 8 Fair Value Measurements ASC Topic 820, “ Fair Value Measurement” , requires that certain financial instruments be recognized at their fair values at the balance sheet dates. However, other financial instruments, such as debt obligations, are not required to be recognized at their fair values, but US GAAP provides an option to elect fair value accounting for these instruments. US GAAP requires the disclosure of the fair values of all financial instruments, regardless of whether they are recognized at their fair values or carrying amounts. For financial instruments recognized at fair value, GAAP requires the disclosure of their fair values by type of instrument, along with other information, including changes in the fair values of certain financial instruments recognized in the operating results or within comprehensive income (loss) of the respective period. For financial instruments not recognized at fair value, the disclosure of their fair values is provided below under “Financial Instruments.” Nonfinancial assets, such as property, plant and equipment, and nonfinancial liabilities are recognized at their carrying amounts in the Company’s balance sheets. GAAP does not permit nonfinancial assets and liabilities to be remeasured at their fair values. However, GAAP requires the remeasurement of such assets and liabilities to their fair values upon the occurrence of certain events, such as the impairment of property, plant and equipment. In addition, if such an event occurs, GAAP requires the disclosure of the fair value of the asset or liability along with other information, including the gain or loss recognized in operating results in the period the remeasurement occurred. The Company did not have any Level 1 or Level 2 assets and liabilities at June 30, 2024 and March 31, 2023. The warrant liabilities and fair value option on Restructured notes, are Level 3 fair value measurements. The following is a summary of activity of Level 3 during the nine months ended June 30, 2024 and the year ended March 31, 2024: Warrant liability SUMMARY OF ACTIVITY OF DERIVATIVES AT FAIR VALUE June 30, 2024 March 31, 2024 (unaudited) Warrant liability balance at beginning of period $ 24,000 $ 355,000 Change in fair value ( 5,000 ) ( 331,000 ) Balance at end of period $ 19,000 $ 24,000 At June 30, 2024, the fair value of the warrant liability was estimated using a Black Sholes option pricing model with the following inputs: the price of the Company’s common stock of $ 0.011 ; a risk-free interest rate ranging from 4.52 % to 4.71 %; and expected volatility of the Company’s common stock ranging from 128.3 % to 137.7 % and the remaining terms of each warrant issuance. At March 31, 2024, the fair value of the warrant liability was estimated using a Black Sholes option pricing model with the following weighted-average inputs: the price of the Company’s common stock of $ 0.011 ; a risk-free interest rate ranging from 4.40 % to 4.59 %, and expected volatility of the Company’s common stock ranging from 124.8 % to 133.8 % and the remaining terms of each warrant issuance. 9 Restructured August and Senior Notes Payable SCHEDULE OF RESTRUCTURED AUGUST AND SENIOR NOTES PAYABLE AT FAIR VALUE June 30, 2024 March 31, 2024 Restructured notes payable fair value at beginning of period $ 29,760,000 $ 23,690,000 Reclass of accrued interest - 907,634 Change in fair value 720,000 5,162,366 Restructured notes payable fair value at end of period $ 30,480,000 $ 29,760,000 On November 4, 2022, when the Company entered into a Restructuring Agreement for an Amended and Restated Secured Promissory Note for two of their outstanding debentures (Note 6 and Note 7), which were accounted for as debt extinguishment, the Company elected to recognize the new debt under the fair value option within ASC Topic 825, “ Financial Instruments .” The fair value for both periods is based on the maturity dates, the interest of 12 %, the 15 % exit fee, the 2% appreciation fee for an estimated period, and a 45% and 40% present value factor , respectively as of June 30, 2024 and March 31, 2024. Financial Instruments The Company’s financial instruments include cash and cash equivalents, receivables, payables, and debt and are accounted for under the provisions of ASC Topic 825. The carrying amount of these financial instruments, with the exception of discounted debt, as reflected in the unaudited condensed consolidated balance sheets approximates fair value. Cash and Cash Equivalents For the purpose of the unaudited condensed consolidated statements of cash flows, the Company considers all highly liquid instruments purchased with a maturity of three months or less to be cash equivalents. There were no cash equivalents at June 30, 2024 and March 31, 2024. Concentration of Credit Risk The Company maintains cash balances at two financial institutions. Accounts at this institution are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $ 250,000 . As of June 30, 2024 and March 31, 2024, the Company’s cash balance did not exceed FDIC coverage. The Company has not experienced any losses in such accounts and periodically evaluates the credit worthiness of the financial institutions and has determined the credit exposure to be negligible. Fixed Assets Equipment is carried at historical value or cost and is depreciated using the straight-line method over the estimated useful lives of the related assets. Estimated useful lives are as follows: SCHEDULE OF ESTIMATED USEFUL LIVES Buildings 39 years Machinery and Equipment 7 – 10 years Vehicles 10 years Furniture and Fixtures 3 – 10 years Maintenance and repairs are charged to expense as incurred. At the time of retirement or other disposition of equipment, the cost and accumulated depreciation will be removed from the accounts and the resulting gain or loss, if any, will be reflected in operations. Stock-Based Compensation The Company accounts for stock-based compensation to employees and non-employees in accordance with ASC 718. “ Stock-based Compensation to Employees ” is measured at the grant date, based on the fair value of the award, and is recognized as expense over the requisite employee service period. The Company estimates the fair value of stock-based payments using the Black-Scholes option-pricing model for common stock options and warrants and the closing price of the Company’s common stock for common share issuances. Once the stock is issued the appropriate expense account is charged. 10 Intangible Assets The Company has intangible assets, which were acquired in a patent acquisition, and license rights agreements. The Company’s patents represent definite lived intangible assets and will be amortized over the twenty-year duration of the patent, unless at some point the useful life is determined to be less than the protected life of the patent. The Company’s license rights will be amortized on a straight-line basis over the expected term of the agreements of ten years. For the three months ended June 30, 2024 and June 30, 2023, the amortization of the patents was $ 97,500 and $ 97,500 and in the amortization of the license rights was $ 270,000 and $ 270,000 , respectively. The Company periodically evaluates the remaining useful lives of its finite-lived intangible assets to determine whether events and circumstances warrant a revision to the remaining period of amortization. As of June 30, 2024, the Company believes the carrying value of the intangible assets are still recoverable, and there is no impairment to be recognized. License agreements On August 25, 2021, the Company, through its 100 % owned subsidiary NAS, entered into an Equipment Rights Agreements with Hydrenesis-Delta Systems, LLC (“Hydrenesis-Delta”) and a Technology Rights Agreement, in a sub-license agreement with Hydrenesis Aquaculture LLC (“Hydrenesis-Aqua”).Both Rights agreements are for a 10-year term, which shall automatically renew for ten-year successive terms. The agreements accord the exclusive rights to purchase or distribute the technology, or buy or rent the equipment, which is the primary business and revenue stream generated from indoor aquaculture farming of any species in the territory, which will be named the NSI Technologies and Equipment (“NSI Technologies”). The terms of the Agreements set forth that NAS will pay Hydrenesis 12.5 % royalty fees. The royalties are calculated per all customer or sub-license revenue generated by NAS, NSI or any affiliate, from the sale or rental of either the Technologies or Hydrenesis Equipment, based on gross revenue less returns, rebates and sales taxes. There are sales milestones for exclusivity, whereby if NAS fails to achieve a sales milestone starting in Year 3, the exclusivity rights in both of the Rights agreements shall revert to non-exclusive rights. To maintain the exclusivity for the subsequent year, the Company may pay the amount of the royalty fees that would have been due if the Sales Milestones had been met in the current year. Impairment of Long-lived Assets The Company will periodically evaluate the carrying value of long-lived assets to be held and used when events and circumstances warrant such a review and at least annually. The carrying value of a long-lived asset is considered impaired when the anticipated undiscounted cash flow from such asset is separately identifiable and is less than its carrying value. In that event, a loss is recognized based on the amount by which the carrying value exceeds the fair value of the long-lived asset. Fair value is determined primarily using the anticipated cash flows discounted at a rate commensurate with the risk involved. Losses on long-lived assets to be disposed of are determined in a similar manner, except that fair values are reduced for the cost to dispose. Commitments and Contingencies Certain conditions may exist as of the date the unaudited condensed consolidated financial statements are issued, which may result in a loss to the Company but which will only be resolved when one or more future events occur or fail to occur. The Company’s management and its legal counsel assess such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or unasserted claims that may result in such proceedings, the Company’s legal counsel evaluates the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein. 11 If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s unaudited condensed consolidated financial statements. If the assessment indicates that a potentially material loss contingency is not probable, but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the nature of the guarantee would be disclosed. Revenue Recognition The Company recognizes revenue in accordance with ASC 606, “Revenue from Contracts with Customers”, as such, the Company records revenue when its customers obtain control of the promised goods or services in an amount that reflects the consideration which the Company expects to receive in exchange for those goods or services. The Company will sell primarily to food service distributors, as well as to wholesalers, retail establishments and seafood distributors. Additionally, the Company will sell or rent the NSI Technologies. To determine revenue recognition for the arrangements that the Company determines are within the scope of Topic 606, the Company performs the following five steps: (1) identify the contract(s) with a customer by receipt of purchase orders and confirmations sent by the Company which includes a required line of credit approval process, (2) identify the performance obligations in the contract which includes shipment of goods to the customer FOB shipping point or destination, (3) determine the transaction price which initiates with the purchase order received from the customer and confirmation sent by the Company and will include discounts and allowances by customer if any, (4) allocate the transaction price to the performance obligations in the contract which is the shipment of the goods to the customer and transaction price determined in step 3 above and (5) recognize revenue when (or as) the entity satisfies a performance obligation which is when the Company transfers control of the goods to the customers by shipment or delivery of the products. In the future, if the Company has customers with long-term contracts for multiple shipments of live shrimp, the Company will elect the right-to-invoice practical expedient and any variable consideration estimate will be excluded from the transaction price and the revenue will be recognized directly when the goods are delivered. SCHEDULE OF REVENUE RECOGNITION June 30, 2024 June 30, 2023 Three months ended June 30, 2024 June 30, 2023 Shrimp sales $ 36,618 $ 55,872 Technology and equipment services - 150,000 Total revenues $ 36,618 $ 205,872 12 Recently Issued Accounting Standards In November 2023, the FASB issued Accounting Standards Update (“ASU”) No. 2023-07 , “ Segment Reporting (Topic 280 ) Improvements to Reportable Segment Disclosures” which expands annual and interim disclosure requirements for reportable segments. The amendments require enhanced disclosure for certain segment items and required disclosure on how management uses reported measures to assess segment performance. The amendments do not change how segments are determined, aggregated, or how thresholds are applied to determine reportable segments. The updated standard is effective for annual periods beginning in fiscal 2025 and interim periods beginning in the first quarter of fiscal 2026. Early adoption is permitted. The Company is currently evaluating the effect of adopting this ASU. In December 2023, the FASB issued ASU No. 2023-09 “ Income Taxes (Topic 740): Improvements to Income Tax Disclosures” which requires two primary enhancements of 1) disaggregated information on a reporting entity’s effective tax rate reconciliation, and 2) information on cash income taxes paid. Additionally, specific disclosures related to unrecognized tax benefits and indefinite reinvestment assertions were removed. For public business entities, the new requirements will be effective for annual periods beginning after December 15, 2024. The guidance will be applied on a prospective basis with the option to apply the standard retrospectively. Early adoption is permitted. The Company is currently evaluating the effect of adopting this ASU. In August 2020, the FASB issued Accounting Standards Update (“ASU”) 2020-06, “Debt - Debt with Conversion and Other Options (Subtopic 470- 20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity” (“ASU 2020-06”), which simplifies the accounting for certain financial instruments with characteristics of liabilities and equity. This ASU (1) simplifies the accounting for convertible debt instruments and convertible preferred stock by removing the existing guidance in ASC 470-20, “Debt: Debt with Conversion and Other Options”, that requires entities to account for beneficial conversion features and cash conversion features in equity, separately from the host convertible debt or preferred stock; (2) revises the scope exception from derivative accounting in ASC 815-40 for freestanding financial instruments and embedded features that are both indexed to the issuer’s own stock and classified in stockholders’ equity, by removing certain criteria required for equity classification; and (3) revises the guidance in ASC 260 to require entities to calculate diluted earnings per share (EPS) for convertible instruments by using the if-converted method. In addition, entities must presume share settlement for purposes of calculating diluted EPS when an instrument may be settled in cash or shares. For SEC filers, excluding smaller reporting companies, ASU 2020-06 is effective for fiscal years beginning after December 15, 2021 including interim periods within those fiscal years. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020. For all other entities, ASU 2020-06 is effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. Entities should adopt the guidance as of the beginning of the fiscal year of adoption and cannot adopt the guidance in an interim reporting period. The Company adopted ASU 2020-06 as of April 1, 2024, which had no impact on its consolidated financial statements and related disclosures. As of June 30, 2024, there were a few new accounting pronouncements issued by the FASB. Each of these pronouncements, as applicable, has been or will be adopted by the Company. Management does not believe the adoption of any of these accounting pronouncements has had or will have a material impact on the Company’s consolidated financial statements. Management’s Evaluation of Subsequent Events The Company evaluates events that have occurred after the accompanying condensed consolidated balance sheet date of June 30, 2024, through the date which the unaudited condensed consolidated financial statements were issued. Based upon the review, other than described in Note 12 – Subsequent Events, the Company did not identify any recognized or non-recognized subsequent events that would have required adjustment or disclosure in the unaudited condensed consolidated financial statements. 13 NOTE 3 – FIXED ASSETS A summary of the fixed assets as of June 30, 2024 and March 31, 2024 is as follows: SCHEDULE OF FIXED ASSETS June 30, 2024 March 31, 2024 (unaudited) Land $ 324,293 $ 324,293 Buildings 6,624,549 6,624,549 Machinery and equipment 11,210,985 11,210,985 Autos and trucks 188,414 208,771 Fixed assets, gross 18,348,241 18,368,598 Accumulated depreciation ( 5,502,261 ) ( 5,067,353 ) Fixed assets, net $ 12,845,980 $ 13,301,245 The unaudited condensed consolidated statements of operations reflect depreciation expense of approximately $ 435,000 and $ 435,000 for the three months ended June 30, 2024 and 2023, respectively. NOTE 4 – SHORT-TERM NOTE AND LINES OF CREDIT The Company has a working capital line of credit with Capital One Bank for $ 50,000 . The line of credit bears an interest rate of prime plus 25.9 basis points , which totaled 34.4 % as of June 30, 2024. The line of credit is unsecured. The balance of the line of credit was $ 9,580 at both June 30, 2024 and March 31, 2024. The Company also has a working capital line of credit with Chase Bank for $ 25,000 . The line of credit bears an interest rate of prime plus 10 basis points, which totaled 18.5 % as of June 30, 2024. The line of credit is secured by assets of the Company’s subsidiaries. The balance of the line of credit is $ 10,237 at June 30, 2024 and March 31, 2024. NOTE 5 – NOTES PAYABLE January 2023 Note On January 20, 2023, the Company entered into a secured promissory note (“January 2023 Note”) with an investor (the “Investor”). The January 2023 Note is in the aggregate principal amount of $ 631,968 . The Note has an interest rate of 10 % per annum, with a maturity date nine months from the issuance date of the Note. The Note carried an original issue discount totaling $ 56,868 , whereby the purchase price is $ 575,100 . All payments made by the Company under the terms in the note, including upon repayment of this Note at maturity, shall be subject to an exit fee of 15 % of the portion of the Outstanding Balance being paid. The cash was not transferred to the Company’s bank account, but instead to a planned merger entity, Yotta Acquisition Corporation, (“Yotta”) for a contribution to a required extension fee for the business combination. On November 17, 2023, the Company received an extension of the maturity date to June 30, 2024, for a $ 5,000 extension fee. The maturity date has been further extended to August 15, 2024 . On November 8, 2023, the Company and the Investor entered into an Exchange Agreement on the January 2023 Note. In the Exchange Agreement the original note was partitioned into a $ 132,000 new promissory note, leaving the original January 2023 Note with an adjusted balance of $ 499,968 . The partitioned note was exchanged for 10,000,000 shares of the Company’s common stock. The shares of common stock issued had a fair value of $ 160,000 based on the market price of the shares of $ 0.016 on the execution date, resulting in an excess of $ 28,000 to be recognized as a financing expense. On January 17, 2024, the Company and the Investor entered into an Exchange Agreement on the January 2023 Note. In the Exchange Agreement the remaining January 2023 Note was partitioned into a $ 99,450 new promissory note, leaving the original January 2023 Note with an adjusted balance of $ 400,518 . The partitioned note was exchanged for 10,000,000 shares of the Company’s common stock. The shares of common stock issued had a fair value of $ 110,000 based on the market price of the shares of $ 0.011 on the execution date, resulting in an excess of $ 10,550 to be recognized as a financing expense. On February 22, 2024, the Company and the Investor entered into an Exchange Agreement on the January 2023 Note. In the Exchange Agreement the remaining January 2023 Note was partitioned into a $ 91,800 new promissory note, leaving the original January 2023 Note with an adjusted balance of $ 313,718 . The partitioned note was exchanged for 10,000,000 shares of the Company’s common stock. The shares of common stock issued had a fair value of $ 190,000 based on the market price of the shares of $ 0.019 on the execution date, resulting in an excess of $ 98,200 to be recognized as a financing expense. On April 3, 2024, the Company and the Investor entered into an Exchange Agreement on the January 2023 Note. In the Exchange Agreement the remaining January 2023 Note was partitioned into a $ 92,700 new promissory note, leaving the original January 2023 Note with an adjusted balance of $ 221,018 . The partitioned note was exchanged for 10,000,000 shares of the Company’s common stock. The shares of common stock issued had a fair value of $ 100,000 based on the market price of the shares of $ 0.010 on the execution date, resulting in an excess of $ 7,300 to be recognized as a financing expense. April 2023 Promissory Note On April 21, 2023, the Company entered into a $ 60,000 promissory note with Yotta Investment LLC (“Yotta Investment”), with no interest to accrue on the principal balance. The promissory note is to be settled on the date of closing of the business combination contemplated by the Merger Agreement with Yotta Acquisition Corporation, (“Merger Agreement”). Upon the occurrence of an event of default, including the termination of the Merger Agreement, the unpaid principal balance of this note, and all other sums payable with regard to this note, shall automatically and immediately become due and payable, in all cases without any action on the part of the Company. The Merger Agreement has been terminated in July 2023, and management believes the promissory note will be settled in the Breakup Fee. 14 May 2023 Promissory Note On May 17, 2023, the Company entered into an additional $ 60,000 promissory note with Yotta Investment, with no interest to accrue on the principal balance. The promissory note is to be settled on the date of closing of the business combination contemplated by the Merger Agreement with Yotta Acquisition Corporation. Upon the occurrence of an event of default, including the termination of the Merger Agreement, the unpaid principal balance of this note, and all other sums payable with regard to this note, shall automatically and immediately become due and payable, in all cases without any action on the part of the Company. The Merger Agreement has been terminated in July 2023, and management believes the promissory note will be settled in the Breakup Fee. Ms. Williams Promissory Note On July 15, 2020, the Company issued a promissory note to Ms. Williams in the amount of $ 383,604 to settle the amounts that had been recognized per the separation agreement with the late Mr. Bill Williams dated August 15, 2019, for his portion of the related party notes and related accrued interest discussed above, and accrued compensation and allowances. The note bears interest at one percent per annum and calls for monthly payments of $ 8,000 until the balance is paid in full. Since the time after the year ended March 31, 2023, the Company has not made the monthly payments. The balance as of both June 30, 2024 and March 31, 2024 was $ 119,604 included in the Notes payable classified in current liabilities, on the condensed consolidated balance sheets. NOTE 6 – RESTRUCTURED AUGUST NOTE PAYABLE The Company entered into a securities purchase agreement (the “SPA”) with an investor (the “Investor”) on August 17, 2022. Pursuant to the SPA, the Investor purchased a secured promissory note (the “Note”) in the aggregate principal amount totaling approximately $ 5,433,333 . The Note has an interest rate of 12 % per annum, with a maturity date nine months from the issuance date of the Note. The Note carried an original issue discount totaling $ 433,333 and a transaction expense amount of $ 10,000 , both of which are included in the principal balance of the Note. On the closing date the Company received $ 1,100,000 , with $ 3,900,000 put into escrow to be held until certain terms were to be met, which included $ 3,400,000 upon the completion of a successful uplist to NYSE or NASDAQ. The SPA includes a Security Agreement, whereby the note is secured by the collateral set forth in the agreement, covering all of the assets of the Company. All payments made by the Company under the terms in the note, including upon repayment of this Note at maturity, shall be subject to an exit fee of 15 % of the portion of the outstanding balance being paid (the “Exit Fee”). As the Exit Fee is to be included in every settlement of the Note, an additional 15 % of the principal balance, which totals $ 816,500 , was recognized along with the principal balance, and offset by a contra account in a manner similar to a debt discount. As soon as reasonably possible, the Company will cause the common stock to be listed for trading on either of (a) NYSE, or (b) NASDAQ (in either event, an “Uplist”). In the event the Company has not effectuated the Uplist by November 15, 2022, the then-current outstanding balance will be increased by 10 %. Following the Uplist, while the Note is still outstanding, ten days after the Company may have a sale of any of its shares of common stock or preferred stock, there shall be a Mandatory Prepayment equal to the greater of $ 3,000,000 or thirty-three percent of the gross proceeds of the equity sale. In conjunction with the Merger Agreement, entered into on October 24, 2022, with Yotta Acquisition Corporation, on November 4, 2022, the Company entered into a Restructuring Agreement for an Amended and Restated Secured Promissory Note (the “August Note”), through which the August Note was amended and restated in its entirety. The Restructured August Note decreased the principal to $1,748,667, less an OID of $138,667, and the amount in escrow was returned to the investor, The Restructuring Agreement included key modifications, in which i) the Uplist terms were removed, ii) in the event that the closing of the Merger does not occur on or before December 31, 2022, the then-current Outstanding Balance will be increased by 2% and shall increase by 2% every 30 days thereafter until the closing or termination of the Merger Agreement, and iii) the outstanding balance of the Convertible Note may be increased by 5% to 15% upon the occurrence of an event of default or failure to obtain the Lender’s consent or notify the Lender for certain major equity related transactions (“Trigger Events”). The Merger had not yet closed, and therefore the 2% of the outstanding balance was increased as of June 30, 2023, in the amount of approximately $ 272,000 . On July 20, 2023, the Company sent Yotta notice of the Company’s termination of the Merger Agreement. On November 20, 2023, the maturity date was extended to June 30, 2024 . The maturity date has been further extended to August 15, 2024 . 15 The Restructured August Note was analyzed under ASC 470-50 as to if the change in terms qualified as a modification or an extinguishment of the note . The changes in terms were considered an extinguishment as the present value of the cash flows under the terms of the new debt instrument was evaluated to be a substantial change, as over 10% difference from the present value of the remaining cash flows under the terms of the original instrument. As such, with the removal of the original note and its debt discount and accrued interest as compared to the restructured note with a fair value of approximately $ 1,933,000 , there was a loss in extinguishment of approximately $ 157,000 . As a result of the extinguishment and at the Company’s election of the fair value option under ASC 825, the August Note will be accounted for at fair value until they are settled. In accordance with ASC 815- 15-25-1(b) a hybrid instrument that is measured at fair value under ASC 825 fair value option each period with changes in fair value reported in earnings as they occur should not be evaluated for embedded derivatives. Therefore, the provisions in the August Note were not evaluated as to if they fell under the guidance of embedded derivatives and were required to be bifurcated. The August Note was revalued as of June 30, 2024 at approximately $ 2,790,000 , with a change in fair value of approximately $ 150,000 . The August Note was revalued as of March 31, 2024 at approximately $ 2,640,000 , with a change in fair value of approximately $ 240,000 in the current year recognized in the accompanying condensed Consolidated Statement of Operations. As of June 30, 2024, the accrued interest from the restructuring date, which is included in the fair value is approximately $ 490,000 . NOTE 7 – RESTRUCTURED SENIOR NOTE PAYABLE December 15, 2021 Debenture The Company entered into a securities purchase agreement (the “SPA”) with an investor (the “Investor”) on December 15, 2021. Pursuant to the SPA, the Investor purchased a secured promissory note (the “Note”) in the aggregate principal amount totaling approximately $ 16,320,000 (the “Principal Amount”). The Note has an interest rate of 12 % per annum, with a maturity date 24 months from the issuance date of the Note (the “Maturity Date”). Beginning on the date that is 6 months from the issuance date of the Note, the Investor had the right to redeem up to $ 1,000,000 of the outstanding balance per month. Payments could have been made by the Company, at the Company’s option, (a) in cash, or (b) by paying the redemption amount in the form of shares of the Company’s common stock, par value $ 0.0001 per share (the “Common Stock”), per the following formula: the number of redemption shares equals the portion of the applicable redemption amount divided by the Redemption Repayment Price. The “Redemption Repayment Price” equaled 90% multiplied by the average of the two lowest volume weighted average price per share of the Common Stock during the ten (10) trading days immediately preceding the date that the Investor delivers notice electing to redeem a portion of the Note. The redemption amount shall include an Exit Fee, consisting of a premium of 15% of the portion of the outstanding balance being paid. As the Exit Fee is to be included in every settlement of the Note, an additional 15% of the principal balance, which totals $2,448,000, was recognized along with the principal balance, and offset by a contra account in a manner similar to a debt discount. In addition to the Investor’s right of redemption, the Company has the option to prepay the Notes at any time prior to the Maturity Date by paying a premium of 15% plus the principal, interest, and fees owed as of the prepayment date. On November 4, 2022, the Company entered into a Restructuring Agreement for an Amended and Restated Secured Promissory Note (the “Senior Note”) with the December 2021 Investor through which the December 2021 Note was amended and restated in its entirety. These amendments were made in conjunction with the Merger Agreement, entered into on October 24, 2022, with Yotta Acquisition Corporation. The main modification of the terms of the Senior Note was that the conversion feature was eliminated. Second, a Mandatory Payment was added whereby within 3 trading days of the closing upon the Merger an amount equal to the lesser of (A) one-third of the amount retained in the Trust Account at the Effective Time or (B) $ 10,000,000 , in order to repay a portion of the outstanding balance of the Senior Note; after which the remaining balance of the Senior Note is to be repaid in equal monthly installments over a 12-month period beginning on a date after the Merger Agreement closing date (“Closing Date”) or the termination of such agreement. All payments made shall be subject to an Exit Fee of 15 % of the portion of the outstanding balance being paid. Additionally, if the Closing Date is after December 31, 2022, the outstanding balance of all indebtedness owed by the Company to December 2021 Investor will be increased automatically by 2% and will automatically increase by 2% every 30 days thereafter until the closing, a termination, or substantially similar terms as approved by the Board of Directors of the Company. Additional key modifications include i) uplist terms in which the Company was to cause the common stock to be listed for trading on either of (a) NYSE, or (b) NASDAQ, were removed, ii) Maturity date was modified from December 15, 2023 to 12 months from the closing or termination of the Merger Agreement, provided not to be later than September 30, 2024, and iii) the outstanding balance of the Senior Note may be increased by 5% to 15% upon the occurrence of an event of default or failure to obtain the Lender’s consent or notify the Lender for certain major equity related transactions (“Trigger Events”). As of June 30, 2023, the Merger had not yet closed, and therefore the 2% of the outstanding balance was increased as of June 30, 2023, in the amount of approximately $ 2,675,000 . On July 20, 2023, the Company sent Yotta notice of the Company’s termination of the Merger Agreement. Based on the termination in July of 2023, the equal monthly payments were to begin on September 20, 2023. On July 3, 2024, the Investor issued a waiver to the Company on the equal monthly payments, which are not currently required to be paid, through August 15, 2024. 16 The Note also contains certain negative covenants and Events of Default, which in addition to common events of default, include the Company fails to maintain the share reserve, the occurrence of a Fundamental Transaction without the Lenders written consent, the Company effectuates a reverse split of its common stock without 20 trading days written notice to Lender, fails to observe or perform or breaches any covenant, and, the Company or any of its subsidiaries, breaches any covenant or other term or condition contained in any Other Agreements in any material. Upon an Event of a Default, at its option and sole discretion, the Investor may consider the Note immediately due and payable. Upon such an Event of Default, the interest rate increases to 18% per annum and the outstanding balance of the Note increases from 5% to 15%, depending upon the specific Event of Default. As of June 30, 2024, the Company is in full compliance with the covenants and Events of Default. The Restructured Senior Note was analyzed under ASC 470-50 as to if the change in terms qualified as a modification or an extinguishment of the note. The changes in terms were considered an extinguishment as the conversion feature has been eliminated and therefore the modified Senior Note is determined to be fundamentally different from the original convertible note. As such, with the removal of the original note and its debt discount and accrued interest as compared to the restructured note with a fair value of approximately $ 18,914,000 , there was a gain in extinguishment of approximately $ 2,540,000 . As of the restructuring date the derivative had a fair value of $ 12,290,000 , based on assumptions used in a bi-nomial option pricing model, which resulted in a change in fair value of $ 17,738,000 as of the restructuring date, from its previous fair value of $ 30,028,000 . The key valuation assumptions used consist, in part, of the price of the Company’s common stock of $ 0.16 at issuance date; a risk-free interest rate of 3.73 % and expected volatility of the Company’s common stock, of 117.77 %, and the strike price of $ 0.1017 . As a result of the extinguishment and at the Company’s election of the fair value option under ASC 825, the Company will account for the Restructured Senior Note at fair value every period end until it is settled. In accordance with ASC 815- 15-25-1(b) a hybrid instrument that is measured at fair value under ASC 825 fair value option each period with changes in fair value reported in earnings as they occur should not be evaluated for embedded derivatives. Therefore, the Company did not evaluate the provisions in the Restructured Senior Note as to whether they fell under the guidance of embedded derivatives and were required to be bifurcated. The Restructured Senior Note was revalued as of June 30, 2024 at approximately $ 27,690,000 , with a change in fair value of approximately $ 570,000 recognized in the Company’s accompanying condensed consolidated Statement of Operations. The Restructured Senior Note was revalued as of March 31, 2024 at approximately $ 27,120,000 , with a change in fair value of approximately $ 5,830,000 recognized in the Company’s accompanying condensed Consolidated Statement of Operations. As of June 30, 2024, the accrued interest from the restructuring date, which is included in the fair value is approximately $ 6,463,000 . 17 NOTE 8 – STOCKHOLDERS’ EQUITY Preferred Stock As of June 30, 2024 and March 31, 2024, the Company had 200,000,000 shares of preferred stock authorized with a par value of $ 0.0001 . Of this amount, 5,000,000 shares of Series A preferred stock are authorized and outstanding, 5,000 shares Series B preferred stock are authorized and no shares outstanding, 5,000 shares Series D preferred stock are authorized with no shares outstanding, 10,000 shares Series E preferred stock are authorized with 1,656 outstanding , 750,000 shares of Series F preferred stock are authorized with 750,000 outstanding, and 10,000 shares of Series G preferred stock are authorized with 645 and 445 outstanding, respectively. Series G Preferred Stock On December 1, 2023, the Board authorized the issuance of 10,000 preferred shares to be designated as Series G Preferred Stock (“Series G Preferred Stock”). The Series G Preferred Stock has a par value of $ 0.0001 , a stated value of $ 1,200 and bear dividends at the rate of 8 % per annum, payable quarterly, to be paid in cash or in-kind, at the discretion of the Company. The Series G Preferred Stock will vote together with the common stock on an as-converted basis subject to the beneficial ownership limitations. The Series G Preferred Stock is required to be redeemed by the Company no later than one calendar year from the date of its issuance. The Series G Preferred Stock is also redeemable at the option of the Company at any time after the original issued date, upon 3 business days’ notice, at a premium rate which is (a) 1.15 if all of the Series G Preferred Stock is redeemed within 90 calendar days from the issuance date thereof; (b) 1.2 if all of the Series G Preferred Stock is redeemed after 90 calendar days and within 120 calendar days from the issuance date thereof; (c) 1.25 if all of the Series G PS is redeemed after 120 calendar days and within 180 calendar days from the issuance date thereof. The Company shall be permitted to redeem the Series G Preferred Stock at any time in cash upon 3 business days prior notice to the Holder or the Holder may convert the Series G Preferred Stock within 3 business days period prior to redemption. The Holder shall have the right to either redeem for cash or convert the Series G Preferred Stock into common stock within 3 business days following the consummation of a qualified offering. The conversion price is based on the discounted market price which is the lower of: (i) A fixed price equaling the closing bid price for the common stock on the trading day preceding the execution of the SPA ; or (ii) 100% of the lowest volume weighted average price (“VWAP)” for the common stock during 10 trading days preceding the conversion request, subject to adjustment. As the redemption feature is mandatorily redeemable within one year of the issuance date, with a substantive conversion option, the Series G Preferred Stock would not fall under liability classification but is to be classified as mezzanine equity. Series G Preferred Equity Offering On December 14, 2023, the Company entered into a Securities Purchase Agreement for the sale of 110 shares of Series G Preferred Stock at a price of $ 1,000 per share of preferred stock, for a total of $ 110,000 . The Purchaser also received an “Equity Incentive”, which was an additional 35 Series G Preferred Stock issued to the Purchaser at the initial closing and deemed to be earned at the time of its issuance. Following the initial closing, the Company and Purchaser shall mutually agree from time to time for the Company to sell and the Purchaser to purchase up to 400 shares of Series G Preferred Stock at a price of $ 1,000 per share in separate closings. The Series G Preferred Stock will earn a dividend of 8 % per annum, for as long as the relevant Preferred Stock has not been redeemed or converted. Dividends are to be paid quarterly, and at the Company’s discretion, in cash or Preferred Stock calculated at the purchase price. On December 19, 2023, the Company received an initial tranche of $ 110,000 under the SPA, less $ 13,000 for legal and commission fees. The $ 77,000 discount will be accreted up to the redemption price over the one-year period until redemption. On January 24, 2024, the Company received a tranche of $ 100,000 under the SPA for 100 Series G Preferred Stock with a stated value of $ 120,000 , less $ 3,000 for legal and commission fees. The $ 23,000 discount will be accreted up to the redemption price over the one-year period until redemption. On February 23, 2024, the Company entered into a consulting agreement in which it was required to issue the consultant a retainer fee to be either $ 180,000 in cash or $ 200,000 in shares of the Company’s preferred stock. The Company issued 200 of their Series G, with a stated value of $ 240,000 . The $ 40,000 discount will be accreted up to the redemption price over the one-year period until redemption. On April 23, 2024, the Company received a tranche of $ 100,000 under the SPA for 100 Series G Preferred Stock with a stated value of $ 120,000 . The $ 20,000 discount will be accreted up to the redemption price over the one-year period until redemption. On June 12, 2024, the Company received a tranche of $ 100,000 under the SPA for 100 Series G Preferred Stock with a stated value of $ 120,000 . The $ 20,000 discount will be accreted up to the redemption price over the one-year period until redemption. On July 10, 2024, the Company received a tranche of $ 100,000 under the SPA for 100 Series G Preferred Stock with a stated value of $ 120,000 . The $ 20,000 discount will be accreted up to the redemption price over the one-year period until redemption. During the three months ending June 30, 2024, the accretion for the Series G Preferred Stock was $ 39,000 . During the year ending March 31, 2024, the accretion for the Series G Preferred Stock was $ 38,000 . Series E Preferred Stock On November 22, 2021, the Company entered into a securities purchase agreement (“SPA”) for 1,500 shares of the Company’s Series E Preferred Stock, at a price of $ 1,000 per share for a purchase price of $ 1,500,000 , with a stated value of $ 1,200 per share, dividends at the rate of twelve percent ( 12 %) per annum, payable quarterly. and are convertible into shares of common stock at the election of the holder of the Series E Preferred Stock at any time at a price of $ 0.35 per share. On July 24, 2023, the Company entered into a Securities Purchase Agreement for the additional sale of 156 shares of Series E Preferred Stock at a price of $ 1,000 per share of Preferred Stock, for a total of $ 156,000 . The Series E Preferred Stock will earn a dividend of 12 % per annum, for as long as the relevant Preferred Stock has not been redeemed or converted. Dividends are to be paid quarterly, and at the Company’s discretion, in cash or Preferred Stock calculated at the purchase price. As of June 30, 2024 the accretion for the Series E Preferred Stock was $ 9,300 . 18 Common Stock On September 28, 2023, the Company increased their authorized common shares to 1,400,000,000 . GHS 2022 Purchase Agreement On November 4, 2022, the Company entered into a purchase agreement (the “GHS Purchase Agreement”) with GHS Investments LLC (“GHS”), an accredited investor, pursuant to which, the Company may require GHS to purchase a maximum of up to 64,000,000 shares of the Company’s common stock (“GHS Purchase Shares”) based on a total aggregate purchase price of up to $ 5,000,000 over a one-year term that ends on November 4, 2023. Notwithstanding the foregoing dollar limitations, the Company and GHS may, from time to time, mutually agree in writing to waive the aforementioned limitations for a relevant Purchase Notice, which waiver, shall not exceed the 4.99 % beneficial ownership limitation contained in the GHS 2022 Purchase Agreement. The Company is to control the timing and amount of any sales of GHS Purchase Shares to GHS. The Company intends to use the net proceeds from this offering for working capital and general corporate purposes. The “Purchase Price” means, with respect to a purchase made pursuant to the GHS Purchase Agreement, 90% of the lowest VWAP during the 10 consecutive business days immediately preceding, but not including, the applicable purchase date. The Company shall deliver a number of GHS Purchase Shares equal to 112.5% of the aggregate purchase amount for such GHS Purchase divided by the Purchase Price per share for such GHS Purchase . If there are any default events, as set forth in the GHS Purchase Agreement, has occurred and is continuing, the Company shall not deliver to GHS any Purchase Notice. Further, pursuant to the terms of the GHS Purchase Agreement, from November 4, 2022 until the date that is the later of (i) the closing of the transactions whereby Yotta Merger Sub, Inc. will merge with and into the Company, with the Company as the surviving company (the “Merger”); and (ii) the 12 month anniversary of the first delivery of GHS Purchase Shares, upon any issuance by the Company or any of its subsidiaries of Common Stock or Common Stock equivalents for cash consideration, indebtedness or a combination of units thereof (a “Subsequent Financing”), GHS shall have the right to participate in any financing, up to an amount of the Subsequent Financing equal to 100% of the Subsequent Financing (the “Participation Maximum”) on the same terms, conditions and price provided for in the Subsequent Financing. Following the Merger, the Participation Maximum shall be 50% of the Subsequent Financing. In the three months ended June 30, 2023, the Company sold 11,981,706 shares of common stock at a net amount of approximately $ 376,000 , at a share price of $ 0.03 , of the GHS Purchase Agreement. $10,000,000 Common Stock Equity Financing On April 28, 2023, the Company entered into an Equity Financing Agreement (“Equity Financing Agreement”) and Registration Rights Agreement with GHS. Under the terms of the Equity Financing Agreement, GHS agreed to provide the Company with up to $ 10,000,000 upon effectiveness of a registration statement on Form S-1 (the “Registration Statement”) filed with the SEC. The Registration Statement was filed on July 20, 2023 and the SEC declared it effective on August 14, 2023. With the effectiveness of the Registration Statement, the Company now has the discretion to deliver puts to GHS and GHS will be obligated to purchase shares of the Company’s common stock, par value $ 0.0001 per share (the “Common Stock”) based on the investment amount specified in each put notice. The maximum amount that the Company shall be entitled to put to GHS in each put notice shall not exceed two hundred percent ( 200 %) of the average daily trading dollar volume of the Company’s Common Stock during the ten ( 10 ) trading days preceding the put, so long as such amount does not equal less than ten thousand dollars ($10,000) or greater than one million dollars ($1,000,000). Pursuant to the Equity Financing Agreement, GHS and its affiliates will not be permitted to purchase and the Company may not put shares of the Company’s Common Stock to GHS that would result in GHS’s beneficial ownership equaling more than 4.99% of the Company’s outstanding Common Stock. The price of each put share shall be equal to eighty percent (80%) of the Market Price (as defined in the Equity Financing Agreement). Following an up-list to the NASDAQ or equivalent national exchange, the price of each put share shall be equal to ninety percent (90%) of the Market Price, subject to a floor price of $1.00 per share. Puts may be delivered by the Company to GHS until the earlier of twenty-four (24) months after the effectiveness of the Registration Statement or the date on which GHS has purchased an aggregate of $10,000,000 worth of Common Stock under the terms of the Equity Financing Agreement . 19 In the three months ended June 30, 2024, the Company sold 66,392,019 shares of common stock at a net amount of approximately $ 486,000 , at share prices of $ 0.007 through $ 0.008 , in relation to the Equity Financing Agreement. In the three months ended September 30, 2023, the Company sold 31,808,246 shares of common stock at a net amount of approximately $ 566,000 , at share price of $ 0.02 related to the Equity Financing Agreement. In the three months ended December 31, 2023, the Company sold 44,843,442 shares of common stock at a net amount of approximately $ 459,000 , at share prices ranging from $ 0.01 to $ 0.02 , in relation to the Equity Financing Agreement. Included in this amount, on October 31, 2023, the Company issued GHS 7,868,985 shares of common stock, for no purchase price, as consideration resulting from GHS receiving a phishing email informing them to wire a purchase price to an incorrect bank, resulting in the Company not receiving the wire and for which GHS resent a second wire to the Company’s correct bank. In the last quarter ending March 31, 2024, the Company sold 100,816,636 shares of common stock at a net amount of approximately $ 845,000 , at share prices of $ 0.008 through $ 0.009 , in relation to the Equity Financing Agreement. GHS 2023 Purchase Agreement On May 9, 2023, the Company entered into a purchase agreement (the “GHS 2023 Purchase Agreement”) with GHS pursuant which the Company may require GHS to purchase a maximum of up to 45,923,929 shares of the Company’s common stock (“GHS 2023 Purchase Shares”) based on a total aggregate purchase price of up to $ 6,000,000 over a one-year term that ends on May 9, 2024. The Company intends to use the net proceeds from this offering for working capital and general corporate purposes. The GHS 2023 Purchase Agreement provides that, upon the terms and subject to the conditions and limitations set forth in the agreement, the Company has the right from time to time during the term of the agreement, in its sole discretion, to deliver to GHS a purchase notice (a “Purchase Notice”) directing GHS to purchase (each, a “GHS Purchase”) a specified number of GHS 2023 Purchase Shares. A GHS Purchase will be made in a minimum amount of $10,000 and up to a maximum of $1,500,000 and provided that, the purchase amount for any purchase will not exceed 200% of the average of the daily trading dollar volume of the Company’s common stock during the 10 business days preceding the purchase date. Notwithstanding the foregoing dollar limitations, the Company and GHS may, from time to time, mutually agree (in writing) to waive the aforementioned limitations for a relevant Purchase Notice, which waiver, for the avoidance of doubt, shall not exceed the 4.99% beneficial ownership limitation contained in the GHS Purchase Agreement. The “Purchase Price” means, with respect to a purchase made pursuant to the GHS Purchase Agreement, 90% of the lowest VWAP (as defined in the GHS 2023 Purchase Agreement) during the Valuation Period (the ten (10) consecutive business days immediately preceding, but not including, the applicable purchase date). The Company shall deliver a number of GHS 2023 Purchase Shares equal to 112.5% of the aggregate purchase amount for such GHS Purchase divided by the Purchase Price per share for such GHS Purchase, against payment by GHS to the Company of the purchase amount with respect to such Purchase (less documented deposit and clearing fees, if any), as full payment for such GHS Purchase Shares via wire transfer of immediately available funds . If there are any default events, as set forth in the GHS Purchase Agreement, has occurred and is continuing, the Company shall not deliver to GHS any Purchase Notice. Further, pursuant to the terms of the GHS 2023 Purchase Agreement, from May 9, 2023 until the date that is the later of (i) the closing of the transactions whereby Yotta Merger Sub, Inc. will merge with and into the Company, with the Company as the surviving company (the “Merger”); and (ii) the 12 month anniversary of the initial closing pursuant to the Section 2(a) of GHS Purchase Agreement, upon any issuance by the Company or any of its subsidiaries of Common Stock or Common Stock equivalents for cash consideration, indebtedness or a combination of units thereof (a “Subsequent Financing”), GHS shall have the right to participate in any financing, up to an amount of the Subsequent Financing equal to 100% of the Subsequent Financing (the “Participation Maximum”) on the same terms, conditions and price provided for in the Subsequent Financing. Following the Merger, the Participation Maximum would have been 50% of the Subsequent Financing. In the three months ended June 30, 2023, the Company sold 28,205,605 shares of common stock at a net amount of approximately $ 923,000 , at share prices ranging from $ 0.03 to $ 0.04 related to the GHS 2023 Purchase Agreement. 20 Common Shares Issued to Consultant On June 19, 2023, 100,000 shares of common stock were issued to a consultant. The shares had a fair value of $ 4,700 , based on the market price of $ 0.047 on the grant date. Options and Warrants The Company has not granted any options since inception. All of the warrants issued have been recognized as a liability, as of the issuance of the convertible debenture on December 15, 2021, based on the fact it as it is not known if there will be sufficient authorized shares to be issued upon settlement, based on the conversion terms of the existing convertible debt. The 18,573,116 warrants outstanding as of June 30, 2024, were revalued as of period end for a fair value of $ 19,000 , with a decrease in the fair value of $ 5,000 recognized on the accompanying condensed consolidated Statement of Operations. The fair value of the warrant liability was estimated using Black Scholes Model, with the following inputs: the price of the Company’s common stock of $ 0.01 ; a risk-free interest rate ranging from 4.52 % to 4.71 %; and expected volatility of the Company’s common stock ranging from 128.3 % to 137.7 % and the remaining terms of each warrant issuance. The 18,573,116 warrants outstanding as of June 30, 2023, were revalued as of period end for a fair value of $ 305,000 , with a decrease in the fair value of $ 50,000 recognized on the accompanying condensed consolidated Statement of Operations. The fair value was estimated using Black Scholes Model, with the following inputs: the price of the Company’s common stock of $ 0.05 ; a risk-free interest rate of 3.81 % to 4.49 %, the expected volatility of the Company’s common stock ranging from 128.3 % to 137.7 %; the estimated remaining term, a dividend rate of 0 %. NOTE 9 – RELATED PARTY TRANSACTIONS Bonus Compensation – Related Party On May 11, 2021, the Company paid the Chief Financial Officer (“CFO”) a bonus of $ 300,000 . On August 10, 2021, the Board of Directors ratified the bonus payment to the CFO and awarded the President and the CTO compensation bonuses of $ 300,000 each. The bonuses to the President and CTO are to be distributed within the next twelve months from the award date, and are included in accrued expenses, related parties as of December 31, 2021. During the year ended March 31, 2022, $ 200,000 was paid each to the President and CTO, with a total of $ 200,000 remaining in accrued expenses, related parties, as of June 30, 2024 and March 31, 2024. Promissory Note On July 10 through July 17, 2023, the Company received $ 140,000 in proceeds from the issuance of three promissory notes with related parties. The notes bear interest at 10 % and have maturity dates one year from the issuance date. The maturity date has been extended for six months to two of the related parties and three months for one of the related party. On August 10, 2022, the Company issued a loan agreement for $ 300,000 , with related parties, which is to be considered priority debt of the Company. As of this filing, five of the related parties have entered into promissory notes under the loan agreement for $ 50,000 each, for a total of cash received of $ 250,000 . The notes bear interest at a 10 % per annum and are due in one year from the issuance date of the notes. The maturity date has been extended an additional six months, to February 10, 2025. 21 For the three months ended June 30, 2024 and June 30, 2023, the interest expense for the related party promissory notes was approximately $ 10,000 and $ 6,000 , respectively. As of June 30, 2024 and March 31, 2024, the accrued interest related to the related party promissory notes was approximately $ 59,000 and $ 26,000 , respectively. NaturalShrimp Holdings, Inc. On January 1, 2016 the Company entered into a notes payable agreement with NaturalShrimp Holdings, Inc.(“NSH”), a shareholder. The note payable has no set monthly payment or maturity date with a stated interest rate of 2 %. During the year ended March 31, 2022, the Company paid off $ 655,750 of the note payable. The outstanding balance is approximately $ 77,000 as of both June 30, 2024 and March 31, 2024. As of both June 30, 2024 and March 31, 2023, accrued interest payable was approximately $ 74,000 . Shareholder Notes The Company has entered into several working capital notes payable to multiple shareholders of NSH and Bill Williams, a former officer and director, and a shareholder of the Company, for a total of $ 486,500 . The notes are unsecured and bear interest at 8 %. These notes had stock issued in lieu of interest and have no set monthly payment or maturity date. The balance of these notes was $ 356,404 as of both June 30, 2024 and March 31, 2024, and is classified as a current liability on the unaudited condensed consolidated balance sheets. As of June 30, 2024 and March 31, 2024, accrued interest payable was approximately $ 146,000 . Shareholders Beginning in 2010, the Company started entering into several working capital notes payable with various shareholders of NSH for a total of $ 290,000 and bearing interest at 8 %. The balance of these notes at June 30, 2024 and March 31, 2024 was $ 54,647 and is classified as a current liability on the unaudited condensed consolidated balance sheets. NOTE 10 – LEASE On May 26, 2021, the Company entered into a sublease for a new office space in Texas. The lease commenced on August 1, 2021 for a monthly rent of $ 7,000 , and was to terminate on October 31, 2025 . The Company assessed its new office lease as an operating lease. At inception, on August 1, 2021, the ROU and lease liability was calculated as approximately $ 316,000 , based on the net present value of the future lease payments over the term of the lease. When available, the Company uses the rate implicit in the lease discount payments as the incremental borrowing rate to calculate the net present value; however, the rate implicit in the lease is not readily determinable for their corporate office lease. In this case, the Company estimated its incremental borrowing rate of 5.75 % as the interest rate it could have incurred to borrow an amount equal to the lease payments in a similar economic environment on a collateralized basis over a term similar to the lease term. The Company estimated its rate based on observable risk-free interest rate and credit spreads for commercial debt of a similar duration as to what rate would have been effective for the Company. On December 31, 2023, the Company moved to a new office space in Texas, and the sublease in effect was terminated. At the termination of the original lease, the existing ROU of approximately $ 153,000 and lease liability of approximately $ 175,000 was removed, with a gain of approximately $ 22,000 recognized in the quarter ended December 31, 2023. 22 On December 20, 2023, the Company entered into a sublease for a new office space in Texas, with a commencement date of January 1, 2024, which will terminate on March 31, 2027. The monthly rates are $2,063 for April 1, 2024 through March 31, 2025, $2,192 for the second year of April 1, 2025 through March 31, 2026 and $2,320 for the final year . On December 19, 2023, the Company paid a $ 2,063 security deposit, which is included in Prepaid expenses on the accompanying condensed consolidated balance sheet. The Company assessed its new office lease as an operating lease. At inception, as of January 1, 2024, the ROU and lease liability was calculated as approximately $ 61,000 , based on the net present value of the future lease payments over the term of the lease. When available, the Company uses the rate implicit in the lease discount payments as the incremental borrowing rate to calculate the net present value; however, the rate implicit in the lease is not readily determinable for their corporate office lease. In this case, the Company estimated its incremental borrowing rate of 14.5 % as the interest rate it could have incurred to borrow an amount equal to the lease payments in a similar economic environment on a collateralized basis over a term similar to the lease term. The Company estimated its rate based on observable risk-free interest rate and credit spreads for commercial debt of a similar duration as to what rate would have been effective for the Company. On September 8, 2021, the Company entered into an equipment lease agreement for VOIP phone equipment. The lease term is for sixty months, with a monthly lease payment of approximately $ 300 . The Company assessed the equipment lease as an operating lease. The Company determined the Right of Use asset and Lease liability values at inception as approximately $ 17,000 calculated at the present value of all future lease payments for the lease term, using an incremental borrowing rate of 5.75 %. The following is a schedule of maturities of lease liabilities as of June 30, 2024: SCHEDULE OF MATURITIES OF LEASE LIABILITIES 2025 $ 21,372 2026 30,043 2027 31,590 Total future minimum lease payments 83,005 Less: imputed interest 15,893 Total $ 67,112 NOTE 11 – COMMITMENTS AND CONTINGENCIES The Company follows ASC 450-20, Loss Contingencies, to report accounting for contingencies. Liabilities for loss contingencies arising from claims, assessments, litigation, fines and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount of the assessment can be reasonably estimated. There were not any known commitments or contingencies as of June 30, 2024 and March 31, 2024. NOTE 12 – SUBSEQUENT EVENTS Subsequent to the period end, through the date of the filing, the Company sold 21,106,846 shares of common stock at a net amount of approximately $ 103,000 , at share prices of $ 0.004 through $ 0.00 7 , in relation to the Equity Financing Agreement. On July 3, 2024, the Company and the Investor entered into an Exchange Agreement on the Restructured Senior Note. In the Exchange Agreement the remaining Restructured Senior Note was partitioned into a $ 90,000 new promissory note, leaving the original Restructured Senior Note outstanding balance to be reduced by $ 90,000 . The partitioned note was exchanged for 10,000,000 shares of the Company’s common stock. The shares of common stock issued had a fair value of $ 90,000 based on the market price of the shares of $ 0.009 on the execution date On July 10, 2024, the Company received a tranche of $ 100,000 under the SPA for 100 Series G Preferred Stock with a stated value of $ 120,000 . The $ 20,000 discount will be accreted up to the redemption price over the one-year period until redemption. On July 24, 2024, one of the holders converted 85 Series E Preferred Stock into 12,289,157 shares of common stock. 23