Company: BLIS
Filing Date: 2025-09-11
Form Type: 10-K
Source: 0001199835-25-000302
Chunk: 14

Company: NAPC Defense, Inc.
Filing Date: 2025-09-11
Form: 10-K
Item: Item 8
Chunk 14
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-10, which provides for the calculation of “basic”
and “diluted” earnings per share. Basic earnings per share includes no dilution and is computed by dividing net income or loss
available to common stockholders by the weighted average common shares outstanding for the period. Diluted earnings per share reflect
the potential dilution of securities that could share in the earnings of an entity.

The potentially dilutive common stock equivalents
for the years ended April 30, 2025 and 2024 were excluded from the dilutive loss per share calculation as they would be antidilutive
due to the net loss. As of April 30, 2025 and 2024, there were approximately 127,072,970 and 11,867,909 shares of common stock underlying
our outstanding convertible notes payable and warrants, respectively.

Fair
Value of Financial Instruments

Fair value is defined as the exchange price that
would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset
or liability, in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair
value must maximize the use of observable inputs and minimize the use of unobservable inputs. The fair value hierarchy is based on three
levels of inputs, of which the first two are considered observable and the last unobservable, as follows:

Level 1 - Quoted prices in active markets for
identical assets or liabilities.

Level 2 - Inputs other than Level 1 that are
observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are
not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the
assets or liabilities.

Level 3 - Unobservable inputs that are supported
by little or no market activity and that are significant to the measurement of the fair value of the assets or liabilities.

The carrying amounts of the Company’s financial
assets and liabilities, such as cash, accounts payable, accrued expenses and interest, certain notes payable and notes payable - 
due to related parties, approximate their fair values because of the short maturity of these instruments.

Fixed
Assets

Fixed
assets are recorded at historical cost. Depreciation is computed on the straight-line method over the estimated useful lives of the respective
assets. Gains and losses upon disposition are reflected in the consolidated statements of operations in the period of disposition. Maintenance