NaturalShrimp Inc 10-Q

Item 1. Financial Statements NATURALSHRIMP INCORPORATED AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENT OF NET LIABILITIES IN LIQUIDATION (Liquidation Basis) September 30, 2025 March 31, 2025 As of September 30, 2025 March 31, 2025 (Unaudited) Cash $ 49,806 $ 101,969 Current assets - 193,865 Fixed assets and intangibles - 35,800,000 Other assets - 86,330 Accounts payable and accrued expenses ( 6,811,919 ) ( 6,809,772 ) Notes payable and lines of credit ( 1,179,832 ) ( 37,200,851 ) Other liabilities ( 933,993 ) ( 962,553 ) Net liabilities in liquidation $ ( 8,875,938 ) $ ( 8,791,012 ) The accompanying notes are an integral part of these consolidated financial statements. 3 NATURALSHRIMP INCORPORATED AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN NET LIABILITIES IN LIQUIDATION (Liquidation Basis) (Unaudited) For the Six Months Ended September 30, 2025 Net liabilities in liquidation, March 31, 2025 $ ( 8,791,012 ) Changes in assets and liabilities in liquidation: Cash ( 52,163 ) Write-off of assets ( 280,195 ) Transfer of fixed assets and intangibles assets to creditor ( 35,800,000 ) Settlement of accounts payable and accrued expenses ( 2,147 ) Extinguishment of notes payable and lines of credit 36,021,019 Extinguishment of other liabilities 28,560 Net changes (increase) in liabilities in liquidation ( 84,926 ) Net liabilities in liquidation, September 30, 2025 $ ( 8,875,938 ) The accompanying notes are an integral part of these Condensed Consolidated financial statements. 4 NATURALSHRIMP INCORPORATED CONDENSED Consolidated STATEMENTS OF OPERATIONS (Going Concern Basis) (Unaudited ) For the Six Months Ended September 30,2024 Sales $ 106,991 Cost of sales 85,490 Net revenue 21,501 Operating expenses: General and administrative 1,352,188 Facility operations 285,546 Depreciation 865,099 Amortization 735,000 Total operating expenses 3,237,833 Net loss from operations ( 3,216,332 ) Other income (expense): Interest expense ( 20,979 ) Interest expense - related parties ( 20,496 ) Interest expense ( 20,496 ) Change in fair value of warrant liability 24,000 Change in fair value of restructured notes ( 720,000 ) Extension fee - Gain on sale of machinery and equipment 39,330 Total other income (expense), net ( 698,145 ) Income (loss) before income taxes ( 3,914,477 ) Provision for income taxes - Net loss ( 3,914,477 ) Less net loss attributable to non-controlling interest - Net loss attributable to NaturalShrimp Inc. ( 3,914,477 ) Accretion on Preferred shares ( 97,300 ) Dividends ( 149,533 ) Net loss available for common stockholders ( 4,161,310 ) Loss per share (Basic and Diluted) ( 0.00 ) Loss per share (Diluted) ( 0.00 ) WEIGHTED AVERAGE SHARES OUTSTANDING (Basic and Diluted) 1,200,205,922 WEIGHTED AVERAGE SHARES OUTSTANDING (Diluted) 1,200,205,922 The accompanying notes are an integral part of these Condensed Consolidated financial statements. 5 NATURALSHRIMP INCORPORATED CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’ DEFICIT F or the six months ended September 30, 2024 (Going Concern Basis) (Unaudited ) Shares Amount Shares Amount Capital issued receivable deficit deficit Series A Preferred stock Common stock Additional paid in Stock to be Subscription Accumulated Total stockholders’ Shares Amount Shares Amount 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 5,000,000 $ 500 1,192,874,082 $ 119,351 $ 127,046,949 $ 390,024 $ ( 56,250 ) $ ( 186,717,101 ) ( 59,216,527 ) Issuance of common shares under financing agreement - - 42,383,507 4,238 163,641 - - - 167,879 Conversion of Series E Preferred Stock 12,289,157 1,229 99,746 100,975 Shares issued upon exchange of Partitioned Note - - 10,000,000 1,000 89,000 - - - 90,000 Accretion on Series G Preferred stock - - - - - - - ( 49,000 ) ( 49,000 ) Dividends payable on Preferred stock - - - - - - - ( 74,436 ) ( 74,436 ) Net loss - - - - - - - ( 1,111,929 ) ( 1,111,929 ) Balance September 30, 2024 5,000,000 $ 500 1,257,546,746 $ 125,818 $ 127,399,336 $ 390,024 $ ( 56,250 ) $ ( 187,952,466 ) ( 60,093,038 ) Balance 5,000,000 $ 500 1,257,546,746 $ 125,818 $ 127,399,336 $ 390,024 $ ( 56,250 ) $ ( 187,952,466 ) ( 60,093,038 ) The accompanying notes are an integral part of these Condensed Consolidated financial statements. 6 NATURALSHRIMP INCORPORATED CONDENSED Consolidated STATEMENTS OF CASH FLOWS (Going Concern Basis) (Unaudited) For the six months ended September 30, 2024 CASH FLOWS FROM OPERATING ACTIVITIES Net loss $ ( 3,914,477 ) Adjustments to reconcile net loss to net cash used in operating activities Depreciation expense 865,099 Amortization expense 735,000 Change in fair value of warrant liability ( 24,000 ) Change in fair value of restructured notes payable 720,000 Financing costs 7,300 Gain on sale of machinery and equipment 39,330 Shares issued for services - Amortization of operating lease right-of-use assets 68,690 Changes in operating assets and liabilities: Accounts receivable ( 7,010 ) Inventory 20,034 Prepaid expenses and other current assets 40,496 Deferred offering costs - Accounts payable ( 347,695 ) Other accrued expenses 10,063 Accrued expenses - related parties 314,340 Accrued interest 12,282 Accrued interest - related parties 20,495 Contract liability - Other current asset-related party ( 45,938 ) Operating lease liabilities ( 70,774 ) Cash used in operating activities ( 1,556,765 ) CASH FLOWS FROM INVESTING ACTIVITIES Cash paid for fixed assets - Cash received for sale of machinery and equipment 117,712 Cash used in investing activities 117,712 CASH FLOWS FROM FINANCING ACTIVITIES Payments of notes payable - Proceeds from line of credit 373,139 Proceeds from sale of stock 653,719 Proceeds from promissory note, related parties 40,000 Proceeds from sale of Series E Preferred Shares - Proceeds from sale of Series G Preferred Shares 300,000 Cash provided by financing activities 1,366,858 NET CHANGE IN CASH ( 72,195 ) CASH AT BEGINNING OF PERIOD 115,525 CASH AT END OF PERIOD $ 43,330 INTEREST PAID $ 8,689 Supplemental Disclosure of Non-Cash Investing and Financing Activities: Shares issued upon conversion of Preferred stock $ - Shares issued upon exchange of Partitioned Note 90,000 Dividends on Series E Preferred stock $ - Dividends in kind issued $ 149,533 Shares issued/to be issued, for legal settlement $ - The accompanying footnotes are an integral part of these condensed consolidated financial statements. 7 NATURALSHRIMP INCORPORATED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2025 (Unaudited) NOTE 1 – NATURE OF THE ORGANIZATION AND BUSINESS NaturalShrimp Incorporated (“NaturalShrimp” or the “Company”), a Nevada corporation, is a former biotechnology company that was focused on growing 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. Receivership and Liquidation On September 4, 2024, Streeterville Capital, LLC, a Utah limited liability company, and Bucktown Capital, LLC, a Utah limited liability company (collectively, “Lenders”), filed a Verified Emergency Motion for Appointment of Receiver (the “Motion”) under Civil Case No. 240907138, in the District Court of Salt Lake County, Utah, against NaturalShrimp, Inc. (“NaturalShrimp”). The Motion alleged, among other things, that NaturalShrimp had defaulted under the terms of its loan agreements with the Lenders. The Motion sought the appointment of a Receiver to immediately take control of NaturalShrimp’s assets. An order was entered ex parte by the Utah State Court in the Receivership Case on September 9, 2024 granting the relief requested by Lenders. The Utah State Court duly appointed Amplēo Turnaround and Restructuring, LLC (the “Receiver”) as the receiver over NaturalShrimp’s assets. The Utah State Court’s order further scheduled a hearing to be held on September 17, 2024, on a preliminary injunction to address issues raised in the Motion. On November 20, 2024, the Lenders and NaturalShrimp filed a Verified Amended and Stipulated Emergency Motion for Immediate Appointment of a Receiver in the Receivership Case. On November 22, 2024, the Utah State Court entered an order granting the Stipulated Motion and appointed Receiver as the receiver over the assets of NaturalShrimp. On February 11, 2025, the Receiver filed a Motion for Approval to Sell Substantially all of the Receivership Entities’ Assets to Streeterville Captial, LLC and Bucktown Captial, LLC (or Their Designees) or Any Other Party With a Higher and Better Offer Free and Clear of All Liens, Interests, Claims, and Encumbrances (the “Sale Motion”) in the Receivership Case. The Sale Motion sought the Utah State Court’s approval for the Receiver to sell substantially all of the Receivership Entities’ assets free and clear of all liens, interests, claims, and encumbrances to Streeterville and Bucktown Capital, through their designated entities, NaturalShrimp Farms, Inc. (“NV Purchaser”), a Nevada corporation, Iowa Shrimp Holdings, LLC (“IA Purchaser”), an Iowa limited liability company, Texas Shrimp Holdings, LLC (“TX Purchaser” or together with NV Purchaser and IA Purchaser, the “Purchasers”), a Texas limited liability company, for a roughly $ 35,703,789.87 credit bid (based on a secured and administrative claim basis) and $ 100,000 cash, pursuant to the terms and conditions set forth in that certain Asset Purchase Agreement (“APA”) between Trustee and Purchasers. The order to sell the assets was approved on March 30, 2025 and the title to the assets was transferred to the lenders on May 14, 2025. 8 NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The Condensed Consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles (“US GAAP”). As the Company’s liquidation became imminent as of March 30, 2025, the Company has presented its financial statements under the liquidation basis of accounting as of both September 30, 2025 and March 31, 2025. To comply with ASC 205-30, Liquidation Basis of Accounting , the Company has presented a condensed consolidated statement of net liabilities in liquidation as of September 30, 2025 and March 31, 2025 and a condensed consolidated statement of changes of net liabilities in liquidation for the six months ended September 30, 2025. In addition, to comply with the financial statement requirements of Article 8 of Regulation S-X, the Company has also presented a condensed consolidated statement of operations, a condensed consolidated statement of changes in shareholders equity and a condensed consolidated statement of cash flows for six months ended September 30, 2024 under the going concern basis of accounting. The going concern financial statements have been presented separately from the liquidation basis financial statements as the results should not be considered comparable under the two presentation methods. The interim financial statements should be read in conjunction with the audited consolidated financial statements, including the notes thereto, included in our 2025 Annual Report on Form 10-K filed with the Securities and Exchange Commission on November 5, 2025. Use of Estimates Preparing financial statements in conformity with accounting principles generally accepted in the United States of America 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. Liquidation Basis of Accounting In accordance with ASC 205-30, Liquidation Basis of Accounting , the Company prepares its financial statements using the liquidation basis of accounting when liquidation is imminent. Liquidation is considered imminent when either of the following occurs-i) A plan for liquidation has been approved by the person or persons with the authority to make such a plan effective, and the likelihood is remote that either execution of the plan will be blocked by other parties or the entity will return from liquidation and ii) A plan for liquidation is imposed by other forces, and the likelihood is remote that the entity will return from liquidation. When using the liquidation basis of accounting, the Company will i) recognize other items that it previously had not recognized but it expects to sell in liquidation or use to settle liabilities ii) accrue costs and income that it expects to incur or earn through the end of its liquidation if and when it has a reasonable basis for estimation iii) measure its assets to reflect the estimated amount of cash or other consideration that it expects to collect in settling or disposing of those assets in carrying out its plan for liquidation and iv) measure its liabilities in accordance with the measurement provision of other topics that it would otherwise apply to those liabilities. Financial Instruments The Company’s financial instruments include cash, payables and debt and are accounted for under the provisions of ASC Topic 825, “ Financial Instruments” . The carrying amount of these financial instruments in the condensed consolidated balance sheets approximates fair value. 9 Cash and Cash Equivalents 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 as of September 30, 2025 and March 31, 2025. Recently Issued Accounting Standards As the Company is currently reporting under the liquidation basis of accounting, it does not believe that there are any recently issued accounting standards that would be material to its financial statements. NOTE 3 – LIQUIDATION BASIS OF ACCOUNTING During September of 2024, Ampleo Turnaround and Restructuring, LLC was placed as the receiver over the Company’s assets due to its significant outstanding debt. Subsequently, during February of 2025, the receiver filed a motion to sell all of the Company’s assets to Streeterville and Bucktown Capital for an approximate credit bid of $ 35.7 million and $ 0.1 million in cash. The motion was approved by the court (overseeing the motion) on March 30, 2025 with title to the assets being transferred to the creditor on May 14, 2025. The Company believes that it continued to function as a going concern until the date the motion to sell its assets was approved by the court at which time its liquidation became imminent. As such, in accordance with the ASC 205-30, the Company has presented i) a condensed consolidated statement of net liabilities in liquidation as of both September 30, 2025 and March 31, 2025 and ii) a condensed consolidated statement of changes in net liabilities in liquidation for the six months ended September 30, 2025. The condensed consolidated statements of net liabilities in liquidation and statement of changes of net liabilities in liquidation have been prepared using the liquidation basis of accounting. As part of the liquidation, the Company transferred ownership of its revenue generating fixed assets and intangible assets on May 14, 2025 to two of its creditors (Streeterville and Buckstown) in exchange for the extinguishment of i) the restructured August and Senior notes and Buckstown line of credit. As of the date of this filing, the Company had limited assets available and was therefore uncertain as to the manner by which it expects to settle its remaining outstanding liabilities. Furthermore, we are also uncertain about the date by which we expect to complete the liquidation. Our condensed consolidated statement of net liabilities in liquidation as of September 30, 2025 and March 31, 2025 reflects the following: ● No additional items were recognized, such as trademarks, that the Company might either sell in liquidation or use to settle its liabilities ● Liabilities have been recognized in accordance with the recognition provisions of other topics that otherwise would apply to those liabilities. As of September 30, 2025, our remaining liabilities were primarily comprised of i) accounts payable and accrued expenses to finance and legal service providers and ii) remaining outstanding debt. Of the approximately $ 8.9 million in outstanding liabilities as of September 30, 2025 approximately $ 3.0 million was to related parties ● As of March 31, 2025, the intangible assets and fixed assets were recognized based on a settlement amount equal to the credit bid of approximately $ 35,800,000 . As of September 30, 2025, intangible assets and fixed assets were fully de-recognized due to ownership of the assets being transferred to our creditors as of May 14, 2025. ● No additional costs expected to be incurred through the end of our liquidation were accrued as of March 31, 2025 as the Company did not have a reasonable basis for estimation at that time. However, as of September 30, 2025 costs expected to be incurred were accrued through December 31, 2025. The amounts accrued subsequent to the balance sheet date were primarily comprised of legal and accounting fees and were not material. We do not expect to earn any additional income through the end of the liquidation period. NOTE 4 – SUBSEQUENT EVENTS In accordance with ASC 855, Subsequent Events, the Company evaluated all events or transactions that occurred after the balance sheet date but before the financial statements were issued. To that extent, the Company noted the following: During March of 2026, NaturalShrimp Incorporated entered into an Intellectual Property Acquisition and Management Transition Agreement (the “Agreement”) with Hydrenesis, Inc., a Florida corporation (“Hydrenesis”), and David Antelo. Pursuant to the agreement: ● The Company will transition its operations toward the commercialization of aquaculture and water treatment technologies; and ● Governance and control of the Company has been transferred in accordance with the Agreement. ● Hydrenesis will transfer certain intellectual property and related technology assets to the Company (the “Transferred IP”); ● The Company’s outstanding obligation to Hydrenesis in the amount of approximately $ 1,034,112 will be converted into equity at Closing; ● The Company has approved and executed Certificates of Designation for Series P, Series P-2, and Series L Preferred Stock, which are expected to be filed with the Nevada Secretary of State; ● Existing liabilities, obligations, and legacy securities, including Series A Preferred Stock and Series F Preferred Stock, will be restructured, amended, cancelled, or exchanged into Series L Preferred Stock; The agreement with Hydrenesis was not yet consummated as of the date of this filing. 10