# EDGAR Filing Document

**Accession Number:** 0001465470
**File Stem:** 0001641172-25-025047
**Filing Date:** 2025-8
**Character Count:** 138130
**Document Hash:** 97b06c8b5e5695024189c2b35366bc61
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001641172-25-025047.hdr.sgml**: 20250821

**ACCESSION NUMBER**: 0001641172-25-025047

**CONFORMED SUBMISSION TYPE**: 10-Q

**PUBLIC DOCUMENT COUNT**: 52

**CONFORMED PERIOD OF REPORT**: 20240930

**FILED AS OF DATE**: 20250821

**DATE AS OF CHANGE**: 20250821

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** NaturalShrimp Inc
- **CENTRAL INDEX KEY:** 0001465470
- **STANDARD INDUSTRIAL CLASSIFICATION:** FISHING, HUNTING & TRAPPING [0900]
- **ORGANIZATION NAME:** 08 Industrial Applications and Services
- **EIN:** 743262176
- **FISCAL YEAR END:** 0331

**FILING VALUES:**
- **FORM TYPE:** 10-Q
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 000-54030
- **FILM NUMBER:** 251238679

**BUSINESS ADDRESS:**
- **STREET 1:** P.O. BOX 1256
- **CITY:** DALLAS
- **STATE:** TX
- **ZIP:** 75225
- **BUSINESS PHONE:** (972) 951-8035

**MAIL ADDRESS:**
- **STREET 1:** P.O. BOX 1256
- **CITY:** DALLAS
- **STATE:** TX
- **ZIP:** 75225

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** MultiPlayer Online Dragon, Inc.
- **DATE OF NAME CHANGE:** 20090603

?xml version='1.0' encoding='ASCII'?

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

**FORM 10-Q**

☒ **QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**

**For the Quarterly Period Ended September 30, 2024**

**or**

☐ **TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**

**For the Transition Period from _________ to _________**

**Commission file number: <u>000-54030</u>**

**<u>NATURALSHRIMP INCORPORATED</u>**

(Exact name of registrant as specified in its charter)

---

| | |
|:---|:---|
| **Nevada** | **74-3262176** |
| (State or other Jurisdiction of<br> Incorporation or Organization) | (I.R.S. Employer<br> Identification No.) |

---

---

| | |
|:---|:---|
| **P.O. Box 1256**<br> **Dallas, Texas** | **75225** |
| (Address of Principal Executive Offices) | (Zip Code) |

---

**<u>(972) 951-8035</u>**

(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

---

| | | |
|:---|:---|:---|
| **Title of each class** | **Trading symbol(s)** | **Name of exchange on which registered** |
| None | N/A | N/A |

---

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☐ No ☒

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☐ No ☒

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a small reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.

---

| | | | |
|:---|:---|:---|:---|
| Large accelerated filer | ☐ | Accelerated filer | ☐ |
| Non-accelerated filer | ☒ | Smaller reporting company | ☒ |
|  |  | Emerging growth company | ☐ |

---

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act: ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of July 21, 2025, there were 1,257,546,746 shares of the registrant's common stock outstanding.

**NATURALSHRIMP INCORPORATED**

**FORM 10-Q**

**FOR THE THREE AND SIX MONTHS ENDED SEPTEMBER 30, 2024**

**TABLE OF CONTENTS**

---

| | | |
|:---|:---|:---|
| | | **Page** |
| **[PART I. FINANCIAL INFORMATION](#Aa_001)** | **[PART I. FINANCIAL INFORMATION](#Aa_001)** | 3 |
| ITEM 1. | [Financial Statements](#Aa_002) | 3 |
|  | [Condensed Consolidated Balance Sheets as of September 30, 2024 (unaudited) and March 31, 2024](#Aa_003) | 3 |
|  | [Condensed Consolidated Statements of Operations for the Three and Six Months Ended September 30, 2024 and 2023 (unaudited)](#Aa_004) | 4 |
|  | [Condensed Consolidated Statements of Changes in Stockholders' Deficit for the Three and Six Months Ended September 30, 2024 and 2023 (unaudited)](#Aa_005) | 5 |
|  | [Condensed Consolidated Statements of Cash Flows for the Six Months Ended September 30, 2024 and 2023 (unaudited)](#Aa_006) | 6 |
|  | [Notes to Condensed Consolidated Financial Statements (unaudited)](#Aa_007) | 7 |
| ITEM 2. | [Management's Discussion and Analysis of Financial Condition and Results of Operations](#Aa_008) | 25 |
| ITEM 3. | [Quantitative and Qualitative Disclosures about Market Risk](#Aa_009) | 31 |
| ITEM 4. | [Controls and Procedures](#Aa_010) | 32 |
| **[PART II. OTHER INFORMATION](#Aa_011)** | **[PART II. OTHER INFORMATION](#Aa_011)** | 33 |
| ITEM 1. | [Legal Proceedings](#Aa_012) | 33 |
| ITEM 1A. | [Risk Factors](#Aa_013) | 33 |
| ITEM 2. | [Unregistered Sales of Equity Securities and Use of Proceeds](#Aa_014) | 33 |
| ITEM 3. | [Defaults Upon Senior Securities](#Aa_015) | 33 |
| ITEM 4. | [Mine Safety Disclosures](#Aa_016) | 33 |
| ITEM 5. | [Other Information](#Aa_017) | 33 |
| ITEM 6. | [Exhibits](#Aa_018) | 34 |
| **[SIGNATURES](#Aa_019)** | **[SIGNATURES](#Aa_019)** | 35 |

---

**PART I – FINANCIAL INFORMATION**

**Item 1. Financial Statements**

**NATURALSHRIMP INCORPORATED AND SUBSIDIARIES**

**CONDENSED CONSOLIDATED BALANCE SHEETS**

---

| | | |
|:---|:---|:---|
|  | **As of** | **As of** |
|  | **September 30, 2024** | **March 31, 2024** |
| Current assets |  |  |
| &nbsp;&nbsp;&nbsp;Cash | $43330 | $115525 |
| &nbsp;&nbsp;&nbsp;Accounts receivable | 34460 | 27450 |
| &nbsp;&nbsp;&nbsp;Inventory | 48476 | 68510 |
| &nbsp;&nbsp;&nbsp;Prepaid expenses | 129154 | 169650 |
| &nbsp;&nbsp;&nbsp;Other current asset-related party | 45938 | - |
| &nbsp;&nbsp;&nbsp;Total current assets | 301358 | 381135 |
| &nbsp;&nbsp;&nbsp;Fixed assets, net | 12279106 | 13301245 |
| Other assets |  |  |
| &nbsp;&nbsp;&nbsp;Patents, net | 5683500 | 5878500 |
| &nbsp;&nbsp;&nbsp;License Agreement, net | 7522376 | 8062376 |
| &nbsp;&nbsp;&nbsp;Right of Use asset | 65830 | 73449 |
| &nbsp;&nbsp;&nbsp;Deposits | 20633 | 20633 |
| &nbsp;&nbsp;&nbsp;Total other assets | 13292339 | 14034958 |
| &nbsp;&nbsp;&nbsp;Total assets | $25872803 | $27717338 |
| Current liabilities |  |  |
| &nbsp;&nbsp;&nbsp;Accounts payable | $3147996 | $3495689 |
| &nbsp;&nbsp;&nbsp;Accrued interest | 119717 | 107435 |
| &nbsp;&nbsp;&nbsp;Accrued interest - related parties | 275088 | 254593 |
| &nbsp;&nbsp;&nbsp;Other accrued expenses | 1753862 | 1743799 |
| &nbsp;&nbsp;&nbsp;Accrued expenses - related parties | 1430449 | 1116107 |
| &nbsp;&nbsp;&nbsp;Short-term Note and Lines of credit | 392956 | 19817 |
| &nbsp;&nbsp;&nbsp;Notes payable | 460622 | 553322 |
| &nbsp;&nbsp;&nbsp;Restructured Senior note payable | 27600000 | 27120000 |
| &nbsp;&nbsp;&nbsp;Restructured August note payable | 2790000 | 2640000 |
| &nbsp;&nbsp;&nbsp;Notes payable - related parties | 920412 | 880412 |
| &nbsp;&nbsp;&nbsp;Dividends payable | 694332 | 544800 |
| &nbsp;&nbsp;&nbsp;Warrant liability |  | 24000 |
| &nbsp;&nbsp;&nbsp;Lease Liability, current | 28560 | 28560 |
| &nbsp;&nbsp;&nbsp;Total current liabilities | 39613994 | 38528534 |
| &nbsp;&nbsp;&nbsp;Lease Liability, non-current | 33622 | 43325 |
| &nbsp;&nbsp;&nbsp;Total liabilities | 39647616 | 38571859 |
| Commitments and contingencies (Note 11) |  |  |
| Series E Redeemable Convertible Preferred stock, $0.0001 par value, 10,000 shares authorized, 1,571 and 1,670 shares issued and outstanding at September 30, 2024 and March 31, 2024, respectively | 1886225 | 1977900 |
| Series F Redeemable Convertible Preferred stock, $0.0001 par value, 750,000 shares authorized, 750,000 shares issued and outstanding at September 30, 2024 and March 31, 2024, respectively | 43612000 | 43612000 |
| Series G Redeemable Convertible Preferred stock, $0.0001 par value, 10,000 shares authorized, 745 and 445 shares issued and outstanding at September 30, 2024 and March 31, 2024, respectively | 820000 | 432000 |
| Stockholders' deficit |  |  |
| &nbsp;&nbsp;&nbsp;Series A Convertible Preferred stock, $0.0001 par value, 5,000,000 shares authorized, 5,000,000 shares issued and outstanding at September 30, 2024 and March 31, 2024, respectively | 500 | 500 |
| &nbsp;&nbsp;&nbsp;Series B Convertible Preferred stock, $0.0001 par value, 5,000 shares authorized, 0 and 607 shares issued and outstanding at September 30, 2024 and March 31, 2024, respectively |  |  |
| &nbsp;&nbsp;&nbsp;Series D Convertible Preferred stock, $0.0001 par value, 20,000 shares authorized, 5,000 and 0 shares issued and outstanding at September 31, 2024 and March 31, 2024, respectively |  |  |
| &nbsp;&nbsp;&nbsp;Common stock, $0.0001 par value, 1,400,000,000 shares authorized, 1,257,546,746 and 1,116,482,063 shares issued and outstanding at September 30, 2024 and March 31, 2024, respectively | 125818 | 111712 |
| &nbsp;&nbsp;&nbsp;Additional paid in capital | 127399336 | 126468749 |
| &nbsp;&nbsp;&nbsp;Stock to be issued | 390024 | 390024 |
| &nbsp;&nbsp;&nbsp;Subscription receivable | (56250) | (56250) |
| &nbsp;&nbsp;&nbsp;Accumulated deficit | (187952466) | (183791156) |
| &nbsp;&nbsp;&nbsp;Total stockholders' deficit | (60093038) | (56876421) |
| &nbsp;&nbsp;&nbsp;Total liabilities, mezzanine and stockholders' deficit | $25872803 | $27717338 |

---

The accompanying notes are an integral part of these consolidated financial statements.

**NATURALSHRIMP INCORPORATED**

**CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS**

**(Unaudited)**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the Three Months Ended** | **For the Three Months Ended** | **For the Six Months Ended** | **For the Six Months Ended** |
|  | **September 30, 2024** | **September 30, 2023** | **September 30, 2024** | **September 30, 2023** |
| Sales | $70373 | $58010 | $106991 | $263882 |
| Cost of sales | 50758 | 51000 | 85490 | 100741 |
| Net revenue | 19615 | 7010 | 21501 | 163141 |
| Operating expenses: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;General and administrative | 247703 | 2403892 | 1352188 | 3702343 |
| &nbsp;&nbsp;&nbsp;Facility operations | 127011 | 157517 | 285546 | 515775 |
| &nbsp;&nbsp;&nbsp;Depreciation | 430191 | 436870 | 865099 | 871679 |
| &nbsp;&nbsp;&nbsp;Amortization | 367500 | 367500 | 735000 | 735000 |
| &nbsp;&nbsp;&nbsp;Total operating expenses | 1172405 | 3365779 | 3237833 | 5824797 |
| Net loss from operations | (1152790) | (3358769) | (3216332) | (5661656) |
| Other income (expense): |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Interest expense | (17080) | (38698) | (20979) | (41411) |
| &nbsp;&nbsp;&nbsp;Interest expense - related parties | (10746) | (9301) | (20496) | (15551) |
| &nbsp;&nbsp;&nbsp;Change in fair value of warrant liability | 19000 | 220000 | 24000 | 270000 |
| &nbsp;&nbsp;&nbsp;Change in fair value of restructured notes |  | 530000 | (720000) | 667634 |
| &nbsp;&nbsp;&nbsp;Extension fee |  |  |  | (180000) |
| &nbsp;&nbsp;&nbsp;Gain on sale of machinery and equipment | 49687 | 10229 | 39330 | 16014 |
| &nbsp;&nbsp;&nbsp;Total other income (expense), net | 40861 | 712230 | (698145) | 716686 |
| Income (loss) before income taxes | (1111929) | (2646539) | (3914477) | (4944970) |
| Provision for income taxes | - | - | - | - |
| Net loss | (1111929) | (2646539) | (3914477) | (4944970) |
| &nbsp;&nbsp;&nbsp;Less net loss attributable to non-controlling interest | - | - | - |  |
| Net loss attributable to NaturalShrimp Inc. | (1111929) | (2646539) | (3914477) | (4944970) |
| Accretion on Preferred shares | (49000) | (9300) | (97300) | (9300) |
| Dividends | (74436) | (59616) | (149533) | (464441) |
| Net loss available for common stockholders | $(1235365) | $(2715455) | (4161310) | $(5418711) |
| Loss per share (Basic and Diluted) | $(0.00) | $(0.00) | (0.00) | $(0.01) |
| Loss per share (Diluted) | $(0.00) | $(0.00) | (0.00) | $(0.00) |
| WEIGHTED AVERAGE SHARES OUTSTANDING (Basic and Diluted) | 1136469359 | 898181855 | 1200205922 | 858760073 |
| WEIGHTED AVERAGE SHARES OUTSTANDING (Diluted) | 1136469359 | 898181855 | 1200205922 | 858760073 |

---

The accompanying notes are an integral part of these consolidated financial statements.

**NATURALSHRIMP INCORPORATED**

**CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' DEFICIT**

**(Unaudited)**

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | Series A <br>Preferred stock | Series A <br>Preferred stock | Common stock | Common stock | | | | | |
|  | Shares | Amount | Shares | Amount | Additional paid in<br>Capital | Stock <br>to be<br>issued | Subscription<br>receivable | Accumulated<br>deficit | Total stockholders'<br>deficit |
| Balance March 31, 2024 | 5000000 | $500 | 1116482063 | $111712 | $126468749 | $390024 | $(56250) | $(183791156) | (56876421) |
| Issuance of common shares under financing agreement |  |  | 66392019 | 6639 | 479200 |  |  |  | 485839 |
| Shares issued upon exchange of Partitioned Note |  |  | 10000000 | 1000 | 99000 |  |  |  | 100000 |
| Accretion of Series E Preferred stock |  |  |  |  |  |  |  | (9300) | (9300) |
| Accretion on Series G Preferred stock |  |  |  |  |  |  |  | (39000) | (39000) |
| Dividends payable on Preferred stock |  |  |  |  |  |  |  | (75097) | (75097) |
| &nbsp;&nbsp;&nbsp;Net loss | - | - | - | - | - | - | - | (2802548) | (2802548) |
| &nbsp;&nbsp;&nbsp;Balance June 30, 2024 | 5000000 | $500 | 1192874082 | $119351 | $127046949 | $390024 | $(56250) | $(186717101) | (59216527) |
| Issuance of common shares under financing agreement |  |  | 42383507 | 4238 | 163641 |  |  |  | 167879 |
| Conversion of Series E Preferred Stock |  |  | 12289157 | 1229 | 99746 |  |  |  | 100975 |
| Shares issued upon exchange of Partitioned Note |  |  | 10000000 | 1000 | 89000 |  |  |  | 90000 |
| Accretion on Series G Preferred stock |  |  |  |  |  |  |  | (49000) | (49000) |
| Dividends payable on Preferred stock |  |  |  |  |  |  |  | (74436) | (74436) |
| &nbsp;&nbsp;&nbsp;Net loss | - | - | - | - | - | - | - | (1111929) | (1111929) |
| &nbsp;&nbsp;&nbsp;Balance September 30, 2024 | 5000000 | $500 | 1257546746 | $125818 | $127399336 | $390024 | $(56250) | $(187952466) | (60093038) |
| Balance March 31, 2023 | 5000000 | $500 | 803123748 | $80377 | $121156733 | $662767 | $(56250) | $(167533292) | (45689165) |
| Common stock issued for legal settlement to NSH shareholders |  |  | 863110 | 86 | 272657 | (272743) |  |  |  |
| Issuance of common shares under financing agreement |  |  | 40187311 | 4019 | 1294493 |  |  |  | 1298512 |
| Conversion of Series E Preferred Shares to common stock |  |  | 23989570 | 2399 | 825601 |  |  | (350825) | 477175 |
| Dividends payable on Series E Preferred Shares |  |  |  |  |  |  |  | (54000) | (54000) |
| Common stock issued to consultants |  |  | 100000 | 10 | 4690 |  |  |  | 4700 |
| &nbsp;&nbsp;&nbsp;Net loss | - | - | - | - | - | - | - | (2298431) | (2298431) |
| Balance June 30, 2023 | 5000000 | $500 | 868263739 | $86891 | $123554174 | $390024 | $(56250) | $(170236548) | (46261209) |
| Common stock issued for legal settlement to NSH shareholders |  |  |  |  |  |  |  |  |  |
| Issuance of common shares under financing agreement |  |  | 31808246 | 3181 | 563089 |  | (109911) |  | 456359 |
| Dividends payable on Series E Preferred Shares |  |  |  |  |  |  |  | (59616) | (59616) |
| Accretion on Series E Preferred shares |  |  |  |  |  |  |  | (9300) | (9300) |
| &nbsp;&nbsp;&nbsp;Net loss | - | - | - | - | - | - | - | (2646539) | (2646539) |
| Balance September 30, 2023 | 5000000 | $500 | 900071985 | $90071 | $124117263 | $390024 | $(166161) | $(172952003) | (48520305) |

---

The accompanying notes are an integral part of these consolidated financial statements.

**NATURALSHRIMP INCORPORATED**

**CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS**

**(Unaudited)**

---

| | | |
|:---|:---|:---|
|  | **For the six month period ended** | **For the six month period ended** |
|  | **September 30, 2024** | **September 30, 2023** |
| **CASH FLOWS FROM OPERATING ACTIVITIES** |  |  |
| &nbsp;&nbsp;&nbsp;Net loss | $(3914477) | $(4944970) |
| &nbsp;&nbsp;&nbsp;Adjustments to reconcile net loss to net cash used in operating activities |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation expense | 865098 | 871679 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization expense | 735000 | 735000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Change in fair value of warrant liability | (24000) | (270000) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Change in fair value of restructured notes payable | 720000 | (667634) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Financing costs | 7300 | 120000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gain on sale of machinery and equipment | 39330 | (16014) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Shares issued for services |  | 4700 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization of operating lease right-of-use assets | 68690 | 21091 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Changes in operating assets and liabilities:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable | (7010) | 15229 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventory | 20034 | (14333) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepaid expenses and other current assets | 40496 | 38648 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred offering costs |  | 1336263 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable | (347695) | 165765 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other accrued expenses | 10063 | (18306) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued expenses - related parties | 314341 | 345212 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued interest | 12282 | 66814 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued interest - related parties | 20495 | 15551 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Contract liability |  | 25000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other current asset-related party | (45938) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating lease liabilities | (70774) | (30141) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Cash used in operating activities** | (1556765) | (2200446) |
| **CASH FLOWS FROM INVESTING ACTIVITIES** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash paid for fixed assets |  | (48800) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash received for sale of machinery and equipment | 117712 | 59000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Cash used in investing activities** | 117712 | 10200 |
| **CASH FLOWS FROM FINANCING ACTIVITIES** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Payments of notes payable |  | (24000) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proceeds from line of credit | 373139 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proceeds from sale of stock | 653719 | 1754871 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proceeds from promissory note, related parties | 40000 | 140000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proceeds from sale of Series E Preferred Shares |  | 150000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proceeds from sale of Series G Preferred Shares | 300000 | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Cash provided by financing activities** | 1366858 | 2020871 |
| **NET CHANGE IN CASH** | (72195) | (169375) |
| **CASH AT BEGINNING OF PERIOD** | 115525 | 216465 |
| **CASH AT END OF PERIOD** | $43330 | $47090 |
| **INTEREST PAID** | $8689 | $616 |
| **Supplemental Disclosure of Non-Cash Investing and Financing Activities:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Shares issued upon conversion of Preferred stock | $- | 828000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Shares issued upon exchange of Partitioned Note | 90000 | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Dividends on Series E Preferred stock | $- | $345209 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Dividends in kind issued | $149533 | $516000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Shares issued/to be issued, for legal settlement | $- | $272743 |

---

The accompanying notes are an integral part of these consolidated financial statements.

**NATURALSHRIMP INCORPORATED**

**NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**FOR THE THREE AND SIX MONTHS ENDED SEPTEMBER 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.

Due to the Company's significant amount of debt that was in default as of September 30, 2024, Ampleo Turnaround and Restructuring, LLC ("the receiver") was placed as the receiver over the Company's assets. Further, the receiver filed a motion to sell substantially all of the Company's assets to Streeterville and Bucktown Capital for an approximate credit bid of $35.7 million and $100,000 in cash. The motion to sell the assets was approved by the court on March 30, 2025 and title to the assets was transferred to Streeterville on May 14, 2025. The Company believes that it continued to function as a going concern until the date of that the motion to sell its assets was approved by the court (on March 30, 2025) at which point liquidation became imminent. To that extent, the Company plans to present its financial statements under the liquidation basis of accounting using a convenience date of March 31, 2025. As such, in accordance with ASC 205-30, *Liquidation Basis of Accounting*, the Company will present a Consolidated statement of net assets (liabilities) in liquidation and Consolidated a statement of changes in net assets (liabilities) in liquidation as of the convenience date. For purposes of reporting under the liquidation basis of accounting the Company plans to measure its assets at the amount used to settle its liabilities (i.e. based on the proposed credit bid).

 

*Receivership* 

 

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 alleges, among other things, that NaturalShrimp has 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 to preserve the same.

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. Under the Amended Receivership Order, the Receiver is the receiver over the Receivership Entities' assets.

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 seeks 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. As part of the sale, the Company transferred its ownership rights to its fixed assets, patents and license agreements (total balance of $25.5 million as of September 30, 2024) in exchange for the extinguishment of its outstanding debt to Streeterville and Buckstown Capital ($30.8 million as of September 30, 2024).

**NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**

*Basis of Presentation*

The accompanying unaudited financial information as of and for the three and six months ended September 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 financial position at such date and the operating results and cash flows for such periods. Operating results for the three and six months ended September 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 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 June 17, 2024.

As discussed in Note 1, Ampleo Turnaround and Restructuring, LLC was placed as the receiver over the Company's assets during September of 2024. Further, 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 $100,000 in cash. The motion was approved on March 30, 2025 with title to the assets being transferred on May 14, 2025. The Company believes that it continued to function as a going concern until the date of the motion to sell was approved. As of the date the motion was approved, the Company plans to present its financial statements using the liquidation basis of accounting as liquidation was considered imminent. As such, in accordance with ASC 205-30, *Liquidation Basis of Accounting*, the Company will present a Consolidated statement of net assets (liabilities) in liquidation and Consolidated statement of changes in net assets (liabilities) in liquidation as of the approximate date that the liquidation became imminent. For purposes of reporting under the liquidation basis of accounting the Company plans to measure its assets at the amount used to settle its liabilities (based on the proposed credit bid). As part of the sale, the Company transferred its ownership rights to its fixed assets, patents and license agreements (total balance of $25.5 million as of September 30, 2024) in exchange for the extinguishment of its outstanding debt to Streeterville and Buckstown Capital ($30.8 million as of September 30, 2024).

*Consolidation*

The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, 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 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.

*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 GAAP provides an option to elect fair value accounting for these instruments. 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 or liabilities at September 30, 2024 or March 31, 2024.

The warrant liabilities and Restructured notes are considered Level 3 fair value measurements.

The following is a summary of activity of our Level 3 financial instruments during the six months ended September 30, 2024 and the year ended March 31, 2024:

**Warrant liability**

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| | | |
|:---|:---|:---|
|  | **September 30,** **2024** | **March 31,** **2024** |
|  | **(unaudited)** | |
| Warrant liability balance at beginning of period | $24000 | $355000 |
| Change in fair value | (24000) | (331000) |
| Balance at end of period | $- | $24000 |

---

At September 30, 2024, the Company's shares were no longer being quoted on the Over the Counter ("OTC") market and technically had a fair value of $0. As such, the warrants were written down to $0.

At March 31, 2024, the fair value of the warrant liability was estimated using a Black Sholes model with the following weighted-average inputs: the price of the Company's common stock of $0.011; a risk-free interest rate of 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.

**Restructured August and Senior Notes Payable**

---

| | | |
|:---|:---|:---|
|  | **September 30,** **2024** | **March 31, 2024** |
| Restructured notes payable fair value at beginning of period | $29760000 | $23690000 |
| Reclass of accrued interest |  | 907634 |
| Change in fair value | 720000 | 5162366 |
| Note Partition | (90000) | - |
| Restructured notes payable fair value at end of period | $30390000 | $29760000 |

---

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 September 30, 2024, and March 31, 2024.

*Financial Instruments*

The Company's financial instruments include cash, 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 September 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 September 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:

---

| | |
|:---|:---|
| 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.

*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 September 30, 2024 and September 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. For the six months ended September 30, 2024 and September 30, 2023, the amortization of the patents was $195,000 and $195,000 and the amortization of the license rights was $540,000 and $540,000, 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 September 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.

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.

Revenues for the three and six months ended September 30, 2024 and 2023 were as follows:

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| | | | | |
|:---|:---|:---|:---|:---|
|  | For the three months ended | For the three months ended | For the six months ended | For the six months ended |
|  | September 30, 2024 | September 30, 2023 | September 30, 2024 | September 30, 2023 |
| Shrimp sales | $70373 | $58010 | $106991 | $88882 |
| Technology and equipment services | - |  | - | 175000 |
| Total revenues | $70373 | $58010 | $106991 | $263882 |

---

*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.

As of September 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.

**NOTE 3 – FIXED ASSETS**

A summary of the fixed assets as of September 30, 2024 and March 31, 2024 is as follows:

---

| | | |
|:---|:---|:---|
|  | **September 30,**<br> **2024** | **March 31,**<br> **2024** |
|  | **(unaudited)** | |
| Land | $187609 | $324293 |
| Buildings | 6624549 | 6624549 |
| Machinery and equipment | 11210638 | 11210985 |
| Autos and trucks | 188415 | 208771 |
| Fixed assets, gross | 18211211 | 18368598 |
| Accumulated depreciation | (5932105) | (5067353) |
| Fixed assets, net | $12279106 | $13301245 |

---

The unaudited condensed consolidated statements of operations reflect depreciation expense of approximately $430,191 and $436,870 and $865,099 and $871,679 for the three and six months ended September 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 September 30, 2024. The line of credit is unsecured. The balance of the line of credit was $9,580 at both September 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 September 30, 2024. The line of credit is secured by assets of the Company's subsidiaries. The balance of the line of credit was $10,237 at September 30, 2024 and March 31, 2024.

During August of 2024, the Company entered into a line of credit with Bucktown Capital, LLC for up to $500,000. The line of credit bears interest at 12%. The balance of the line of credit was $373,139 as of September 30, 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 the merger entity, Yotta Acquisition Corporation (Note 11), 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 was 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. The note is in default as of the date of this filing.

*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. As discussed in Note 11, the Merger Agreement was terminated, and management believes the promissory note will be settled in the Breakup Fee.

*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. As discussed in Note 11, the Merger Agreement was terminated, 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. The balance as of September 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, were 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 (Note 11), 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 did not close 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 was then further extended to August 15, 2024. However, the note was in default as of the time of this filing.

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 March 31, 2024 to $2,640,000. The August Note was revalued as of September 30, 2024 to $2,790,000. As of September 30, 2024, the accrued interest from the restructuring date which is included in the fair value was approximately $571,000.

**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 was 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 (Note 11), 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 has 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 (See Note 11). Based on the termination in July of 2023, the equal monthly payments were to begin on September 20, 2023. On July 3, 2024, the Company and the Investor entered into an Exchange Agreement on the Restructured Senior Note. As part of the Exchange Agreement, the remaining Restructured Senior Note was partitioned into a $90,000 new promissory note, which 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 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. The note was in default as of the date of this filing.

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.

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 September 30, 2024 at approximately $27,600,000. The Senior Note was revalued as of March 31, 2024, at approximately $27,120,000. As of September 30, 2024, the accrued interest from the restructuring date, which is included in the fair value was approximately $7,269,000.

**NOTE 8 – STOCKHOLDERS' EQUITY**

*Preferred Stock*

As of September 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 and 1,571 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 745 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 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 and six months ending September 30, 2024, the accretion for the Series G Preferred Stock was $49,000 and $88,000, respectively.

*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. During the three and six months ended September 30, 2024 the accretion for the Series E Preferred Stock was $0 and $9,300, respectively.

 ****

***<u>Common Stock</u>***

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.

In the six months ended September 30, 2024, the Company sold 108,775,526 shares of common stock at a gross amount of approximately $653,719, at share prices of $0.003 through $0.008, in relation to the Equity Financing Agreement.

In the six months ended September 30, 2023, the Company sold 71,995,557 shares of common stock at a net amount of approximately $1,754,871, at share price of $0.02 related 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.

*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, because 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 warrants were revalued at $0 at September 30, 2024 due to limited value of the Company's shares.

**NOTE 9 – RELATED PARTY TRANSACTIONS**

*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. In addition, the Company received an additional $40,000 in proceeds during the three months ended September 30, 2024 for total proceeds outstanding of $180,000. 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 on 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.

For the three and six months ended September 30, 2024 and September 2023, the interest expense for the related party promissory notes was approximately $11,000 and $9,301 and $21,000 and $15,551, respectively. As of September 30, 2024 and March 31, 2024, the accrued interest related to the related party promissory notes was approximately $72,000 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 September 30, 2024 and March 31, 2024. As of both September 30, 2024 and March 31, 2024, 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 September 30, 2024 and March 31, 2024, and is classified as a current liability on the unaudited condensed consolidated balance sheets. As of September 30, 2024 and March 31, 2024, accrued interest payable was approximately $182,000.

*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 September 30, 2024 and March 31, 2024 was $54,647 and is classified as a current liability on the unaudited condensed consolidated balance sheets. As of September 30, 2024 and March 31, 2024 accrued interest payable was approximately $21,570 and $21,570, respectively.

**NOTE 10 – 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 September 30, 2024 and March 31, 2024.

**NOTE 11 – 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 material events or transactions:

***Liquidation Basis of Accounting***

 ****

As discussed in Note 1, Ampleo Turnaround and Restructuring, LLC was placed as the receiver over the Company's assets during September of 2024. Further, 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 $100,000 in cash. The motion was approved on March 30, 2025 with title to the assets being transferred on May 14, 2025. The Company believes that it continued to function as a going concern until the date the motion to sell was approved. As of the date the motion was approved, the Company plans to present its financial statements using the liquidation basis of accounting as liquidation was considered imminent. As such, in accordance with ASC 205-30, *Liquidation Basis of Accounting*, the Company will present a Consolidated statement of net assets (liabilities) in liquidation and Consolidated statement of changes in net assets (liabilities) in liquidation as of the approximate date that the liquidation became imminent. For purposes of reporting under the liquidation basis of accounting the Company plans to measure its assets at the amount used to settle its liabilities (based on the proposed credit bid). As part of the sale, the Company transferred its ownership rights to its fixed assets, patents and license agreements (total balance of $25.5 million as of September 30, 2024) in exchange for the extinguishment of its outstanding debt to Streeterville and Buckstown Capital ($30.8 million as of September 30, 2024).

**ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS**

*Note Regarding Forward-Looking Statements*

This Quarterly Report on Form 10-Q includes a number of forward-looking statements that reflect management's current views with respect to future events and financial performance. Forward-looking statements are projections in respect of future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as "may," "should," "expects," "plans," "anticipates," "believes," "estimates," "predicts," "potential" or "continue" or the negative of these terms or other comparable terminology. These statements include statements regarding the intent, belief or current expectations of us and members of our management team, as well as the assumptions on which such statements are based. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risk and uncertainties, and that actual results may differ materially from those contemplated by such forward-looking statements. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks set forth in the section entitled "Risk Factors" in our Annual Report on Form 10-K for the fiscal year ended March 31, 2024, as filed with the U.S. Securities and Exchange Commission (the "SEC") on July 17, 2024, any of which may cause our company's or our industry's actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied in our forward-looking statements.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, or performance. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

Readers are urged to carefully review and consider the various disclosures made by us in this report and in our other reports filed with the SEC. We undertake no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes in the future operating results over time except as required by law. We believe that our assumptions are based upon reasonable data derived from and known about our business and operations. No assurances are made that actual results of operations or the results of our future activities will not differ materially from our assumptions.

As used in this Quarterly Report on Form 10-Q and unless otherwise indicated, the terms "Company," "we," "us," and "our" refer to NaturalShrimp Incorporated and its wholly-owned subsidiaries NSC, NS Global and NAS. The Company also owns 51% of NaturalShrimp/Hydrenesis LLC, a Texas limited liability company. Unless otherwise specified, all dollar amounts are expressed in United States Dollars.

*Use of Generally Accepted Accounting Principles ("GAAP") Financial Measures*

We use United States GAAP financial measures, unless otherwise noted. All of the GAAP financial measures used by us in this report relate to the inclusion of financial information. This discussion and analysis should be read in conjunction with our financial statements and the notes thereto included elsewhere in this annual report. All references to dollar amounts in this section are in United States dollars, unless expressly stated otherwise.

This discussion and analysis should be read in conjunction with our financial statements and the notes thereto included elsewhere in this annual report.

*Overview*

We are an aquaculture technology company that has developed proprietary, patented platform technologies to allow for the production of aquatic species in an ecologically controlled, high-density, low-cost environment, and in fully contained and independent production facilities without the use of antibiotics or toxic chemicals. We own and operate indoor recirculating Pacific White shrimp production facilities in Texas and Iowa using these technologies.

We were incorporated in July 2008 and acquired substantially all of the assets of NSH, the company that developed the proprietary technology to grow and sell shrimp potentially anywhere in the world that is now the basis of our business. In 2015 NSH acquired 88.62% of the issued and outstanding shares of NaturalShrimp Common Stock, NSC and NS Global became our wholly-owned subsidiaries, and we changed our principal business to a global shrimp farming company.

On October 5, 2015, we formed NAS with F&T, the purpose of which was to jointly develop with F&T certain water technologies.

On December 17, 2020, we acquired for $10.0 million certain assets from VeroBlue Farms USA, Inc. and its subsidiaries, which assets included our three current facilities located in Iowa.

On May 25, 2021, we purchased certain parent and intellectual property rights from F&T and acquired all of its outstanding shares in NAS, thereby making NAS our wholly-owned subsidiary, for $3.0 million in cash and 13,861,386 shares of NaturalShrimp Common Stock.

On August 25, 2021, through NAS, we entered into an Equipment Rights Agreements with Hydrenesis-Delta Systems, LLC and a Technology Rights Agreement with Hydrenesis Aquaculture LLC. The Equipment Rights Agreement relates to specialized and proprietary equipment used to produce and control, dose, and infuse Hydrogas<sup>®</sup> and RLS<sup>®</sup> into both water and other chemical species, while the Technology Rights Agreement provides us with a sublicense to the rights to Hydrogas<sup>®</sup> and RLS<sup>®</sup>.

The Company has three wholly-owned subsidiaries: NSC, NS Global, and NAS, and owns 51% of NaturalShrimp/Hydrenesis LLC, a Texas limited liability company.

Most of the shrimp consumed in the world today come from shrimp farms that can only produce crops between one and four times per year. Consequently, the shrimp from these farms requires freezing between crops until consumed. Our system is designed to harvest different tanks each week, which provides for fresh shrimp throughout the year. We strive to create a niche market of "Always Fresh, Always Natural" shrimp. As opposed to many of the foreign shrimp farms, we can also claim that our product is 100% free of antibiotics. The ability to grow shrimp locally and year-round allows us to provide this high-end product to upscale restaurant and grocery stores throughout the world. We rotate the stocking and harvesting of our tanks each week, which allows for weekly shrimp harvests. Our product is free of pollutants and is fed only the highest-quality feeds.

We began making regular weekly sales of live shrimp from our Iowa production facility in November 2021 and from our Texas production facility in June 2022. The Company is using its aforementioned platform technologies to retrofit 344,000 square feet of its existing Iowa facilities that we expect will, once fully operational, produce 18,000 pounds of shrimp per week. We believe that the combined output from our La Coste, Texas and Iowa facilities will be approximately 24,000 pounds of shrimp production per week by the third or fourth calendar quarter of 2025. We can, however, provide no assurances as to how significant our revenue will be in the next one to two fiscal quarters.

As discussed in our consolidated financial statements, Ampleo Turnaround and Restructuring, LLC was placed as the receiver over the Company's assets during September of 2024. Further, during February of 2025, the receiver submitted a motion to sell substantially all of the Company's assets to Streeterville and Bucktown Capital for an approximate credit bid of $35.7m and $100,000 in cash. The Company believes that it continued to function as a going concern until the date of the approved sale. Subsequent to that date, the Company plans to present its financial statements using the liquidation basis of accounting as liquidation was considered imminent. As such, in accordance with ASC 205-30, *Liquidation Basis of Accounting*, the Company will present a Consolidated statement of net assets (liabilities) in liquidation and Consolidated statement of changes in net assets (liabilities) in liquidation as of the approximate date that the liquidation became imminent. For purposes of reporting under the liquidation basis of accounting the Company plans to measure its assets at the amount used to settle its liabilities (based on the proposed credit bid).

*Liquidity and Capital Resources*

 

As of September 30, 2024, we had cash on hand of approximately $43,330 and working capital deficiency of $39,312,635, as compared to cash on hand of approximately $116,000 and a working capital deficiency of approximately $38,147,000 as of March 31, 2024. While we continued to function as a going concern during the interim period ended September 30, 2024, the Company plans to liquidate its assets in order to settle its outstanding debts.

*Receivership*

 

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 alleges, among other things, that NaturalShrimp has defaulted under the terms of its loan agreements with Lenders. The Motion sought the appointment of a Receiver to immediately take control of NaturalShrimp's assets to preserve the same.

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. Under the Amended Receivership Order, the Receiver is the receiver over the Receivership Entities' assets.

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 seeks 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. As part of the sale, the Company transferred its ownership rights to its fixed assets, patents and license agreements (total balance of $25.5 million as of September 30, 2024) in exchange for the extinguishment of its outstanding debt to Streeterville and Buckstown Capital ($30.8 million as of September 30, 2024).

**Cash Flows**

 

The following table summarizes our cash flows for the six months ended September 30, 2024 and 2023:

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| | | |
|:---|:---|:---|
|  | **Six months Ended September 30,** | **Six months Ended September 30,** |
|  | **2024** | **2023** |
| Net cash used in operating activities | $(1556764) | $(2200446) |
| Net cash provided by (used in) investing activities | 117712 | 10200 |
| Net cash provided by financing activities | 1366858 | 2020871 |
| Net change in cash | $(72195) | $(169375) |

---

Net cash used in operating activities during the six months ended September 30, 2024, was a decrease of approximately $644,000 as compared to the same period in 2023. The decrease in cash used is primarily due to the decrease in the current period net loss as compared to the same period the prior year and adjustments to reconcile the net loss to net cash, including i) the change in fair value of the restructured notes and ii) the prior period write-off of deferred offering costs.

The net cash provided by investing activities in the six months ended September 30, 2024 increased by $107,512 compared to net cash used by investing activities for the same period in the prior fiscal year. The increase was in the current period was due primarily to cash of $117,712 that was received for the sale of machinery and equipment.

The net cash provided by financing activities decreased by $654,014 between periods. For the current period, the Company received approximately $653,719 for the sale of shares of common shares and $300,000 for the sale of the new Series G Preferred Shares. In the same period in the prior year the Company received $1,755,000 for the sale of shares of common stock.

*Results of Operations*

**Comparison of the Three Months Ended September 30, 2024 to the Three Months Ended September 30, 2023**

Revenue

We had gross sales revenue of $70,373 and $58,010, respectively, during the three months ended September 30, 2024 and 2023, an increase of approximately $12,000 or 12%.

Our increase in gross sales revenue during the three months ended September 30, 2024 over the same period in the prior year was a result of slightly higher shrimp sales during the period.

Cost of Sales

Cost of sales includes direct costs related to the production and sale of our products, primarily the cost of the post-larva shrimp that we purchase to grow into our shrimp product at our facilities and the costs of shipping purchase orders to customers. Cost of sales were $50,758 and $51,000, respectively, during the three months ended September 30, 2024 and 2023.

Operating Expenses

Operating expenses for the three months ended September 30, 2024 were $1,172,405, which is a 65.2% decrease over operating expenses of $3,365,779 for the same period in 2023. The overall change in expenses is primarily due to a $1.3 million writeoff of deferred offering costs in the prior period (related to the merger termination) that did not recur during the current period.

Other Income (Expense)

The following table summarizes the various components of our other income (expense) for the three months ended September 30, 2024 and 2023:

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| | | |
|:---|:---|:---|
|  | **Three Months Ended** **September 30,** | **Three Months Ended** **September 30,** |
|  | **2024** | **2023** |
| Interest expense | $(17080) | $(38698) |
| Interest expense – related parties | (10746) | (9301) |
| Change in fair value of warrant liability | 19000 | 220000 |
| Change in fair value of restructured notes |  | 530000 |
| Gain on sale of machinery and equipment | 49687 | 10229 |
| Total | $40861 | $712230 |

---

Other Income (expense) for the three months ended September 30, 2024 decreased by $671,369 as compared to the same period in the prior year. The decrease was primarily due to the change in fair value of the restructured notes and the change in fair value of the warrant liability.

**Comparison of the Six Months Ended September 30, 2024 to the Six Months Ended September 30, 2023**

Revenue

 

The Company had gross sales revenue of $106,991 and $263,882, respectively, during the six months ended September 30, 2024 and 2023, a decrease of approximately $157,000, or 60%. The decrease in gross sales revenue during the six months ended September 30, 2024 over the same period in the prior year was a result of the $150,000 of revenue recognized in the prior period stemming from the rental of NSI Technologies that did not recur during the current period.

Cost of Sales

Cost of sales decreased by approximately $15,000 during the six months ended September 30, 2024 as compared to the same period in the prior year. The decrease primarily relates to the $15,000 in costs of sales incurred related to the rental of NSI technologies in the prior period that did not recur in the current period.

Operating Expenses

Operating expenses for the six months ended September 30, 2024 decreased by $2,586,964, or 63.5%, compared to the same period in 2023, primarily due to a decrease in professional fees stemming from the $1.3 million write-off of deferred offering costs as a result of the termination of the Merger Agreement. In addition, the decrease was also due to a decrease in facility operation of approximately $230,000 and salaries of approximately $180,000 as compared to the same period in the prior year.

Other income (expense)

The following table summarizes the various components of our Other income(expense) for each of the six months ended September 30, 2024 and September 30, 2023:

---

| | | |
|:---|:---|:---|
|  | **Six Months Ended** **September 30,** | **Six Months Ended** **September 30,** |
|  | **2024** | **2023** |
| Interest expense | $(20979) | $(41411) |
| Interest expense - related parties | (20496) | (15551) |
| Change in fair value of warrant liability | 24000 | 270000 |
| Change in fair value of restructured notes | (720000) | 667634 |
| Extension Fee |  | (180000) |
| Gain on sale of machinery and equipment | 39330 | 16014 |
| Total other income (expense) | $(698145) | $716686 |

---

Other Income (expense) for the six months ended September 30, 2024, decreased $1,414,831 as compared to the same period in the prior year. The decrease was due to primarily to the change in fair value of the restructured notes and warrant liability.

*Critical Accounting Estimates*

**Fair Value Measurement**

The fair value measurement guidance clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in the valuation of an asset or liability. It establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy under the fair value measurement guidance are described below:

Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities;

Level 2 - Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability; or

Level 3 - Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity).

The warrant liabilities and fair value option on Restructured notes, are Level 3 fair value measurements.

**Impairment of Long-lived Assets and 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.

**Revenue Recognition**

The Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customers, and, as such, the Company records revenue when its customers obtain control of the promised goods or services in an amount that reflects the consideration that 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 either the NSI Technologies or Equipment.

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 Company satisfies a performance obligation, which is when the Company transfers control of the goods to the customers by shipment or delivery of the products.

*Recently Adopted Accounting Pronouncements*

Our recently adopted accounting pronouncements are more fully described in Note 2 to our financial statements included herein for the quarter ended September 30, 2024.

*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 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, Earnings Per Share, 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.

During the period ending September 30, 2024, there were a few new accounting pronouncements issued by the Financial Accounting Standards Board. 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.

**Item 3. Quantitative and Qualitative Disclosures about Market Risk**

Not Applicable. As a smaller reporting company, we are not required to provide the information required by this Item.

**Item 4. Controls and Procedures**

*Evaluation of Disclosure Controls and Procedures*

We maintain a system of disclosure controls and procedures (as that term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act")) that are designed to provide reasonable assurance that information required to be disclosed in our reports under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosures.

In designing and evaluating our disclosure controls and procedures, management recognizes that any disclosure controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints, and that management is required to apply judgment in evaluating the benefits of possible controls and procedures relative to their costs.

The Company's management, with the participation of our principal executive officer and principal financial officer, has evaluated the effectiveness of the design and operation of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act, as of the end of the period covered by this Report.

Based upon that evaluation , our principal executive officer and principal financial officer concluded that, as of September 30, 2024, our disclosure controls and procedures were not effective due to the material weaknesses in internal control over financial reporting described below. Thus, there remains a reasonable possibility that a material misstatement of the Company's interim financial statements will not be prevented or detected on a timely basis. This does not include an evaluation by the Company's registered public accounting firm regarding the Company's internal control over financial reporting. Accordingly, we cannot provide reasonable assurance that information required to be disclosed by us in reports we file or submit under the Exchange Act is recorded, processed, summarized and reported, to allow our principal financial and executive officers to make timely decisions regarding required disclosures as of September 30, 2024.

Management's evaluation was based on the following material weaknesses in our internal control over financial reporting which existed as of March 31, 2024, and which continue to exist, as discussed in the Company's Annual Report on Form 10-K:

● Inadequate
 segregation of duties consistent with control objectives;

● Lack
 of independent Board of Directors (as of the balance sheet date) and absence of Audit Committee to exercise oversight responsibility
 related to financial reporting and internal control;

● Lack
 of risk assessment procedures on internal controls to detect financial reporting risks in a timely manner; and

● Lack
 of documentation on policies and procedures that are critical to the accomplishment of financial reporting objectives.

Our management will continue to monitor and evaluate the relevance of our risk-based approach and the effectiveness of our internal controls and procedures over financial reporting on an ongoing basis and is committed to taking further action and implementing additional enhancements or improvements, as necessary and as funds allow.

*Remediation Plan*

Management continues to implement measures designed to ensure that control deficiencies contributing to the material weakness are remediated, such that these controls are designed, implemented, and operating effectively.

The remediation actions planned include:

● Identify gaps in our skills base and the expertise of our staff required to meet the financial reporting requirements of a public company;

● Establish an independent Board of Directors and an Audit Committee to provide oversight for remediation efforts and ongoing guidance regarding accounting, financial reporting, overall risks and the internal control environment;

● Retain additional accounting personnel with public company financial reporting, technical accounting, SEC compliance, and strategic financial advisory experience to achieve adequate segregation of duties; and

● Continue to develop formal policies and procedures on accounting and internal control over financial reporting and monitor the effectiveness of existing controls and procedures.

*Changes in Internal Control over Financial Reporting*

There have been no changes in our internal control over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act) during the fiscal quarter ended September 30, 2024 that have materially affected, or that are reasonably likely to materially affect, our internal control over financial reporting.

**PART II – OTHER INFORMATION**

**Item 1. Legal Proceedings**

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 (the "Receivership Case"), in the District Court of Salt Lake County, Utah (the "Utah State Court"), against NaturalShrimp, Inc. ("NaturalShrimp"), a Nevada corporation.

The Motion alleges, among other things, that NaturalShrimp has defaulted under the terms of its loan agreements with Lenders. The Motion sought the appointment of a Receiver to immediately take control of NaturalShrimp's assets to preserve same.

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 NaturalShrip'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, Lenders, NaturalShrimp, NaturalShrimp USA Corporation ("NaturalShrimp USA"), NaturalShrimp Global, Inc. ("NaturalShrimp Global"), and Natural Aquatic Systems, Inc. ("Natural Aquatic") (collectively, the "Receivership Entities") filed a *Verified Amended and Stipulated Emergency Motion for Immediate Appointment of a Receiver* (the "Stipulated Motion") 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 USA NaturalShrimp Global, and Natural Aquatic Systems pursuant to an amended receivership order (the "Amended Receivership Order"). Under the Amended Receivership Order, the Receiver is the receiver over the Receivership Entities' assets.

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 seeks 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. As part of the sale, the Company transferred its ownership rights to its fixed assets, patents and license agreements (total balance of $25.5 million as of September 30, 2024) in exchange for the extinguishment of its outstanding debt to Streeterville and Buckstown Capital ($30.8 million as of September 30, 2024).

**Item 1A. Risk Factors**

As a smaller reporting Company ("SRC") we are not required to provide this information.

**Item 2. Unregistered Sales of Equity Securities and Use Of Proceeds**

The Company had the following unregistered sale of equity securing during the three months ended September 30, 2024. All shares were issued under Section 4(a)(2) of the Securities Act of 1933 as follows:

● On July 1, 2024 the Company sold 6,459,985 shares to GHS at approximately $0.0066 per share for gross proceeds of approximately $43,000

● On July 12, 2024 the Company issued 10,000,000 shares to Streeterville to settle a $90,000 obligation that was partitioned from the restructured senior note outstanding.

● On July 25, 2024 the Company issued 12,289,157 shares to GHS to satisfy the conversion of 85 Series E preferred shares

● On August 13, 2024 the Company sold 14,646,861 shares to GHS at approximately $0.0042 per share for gross proceeds of approximately $62,000

● On August 24, 2024 the Company sold 21,276,661 shares to GHS at approximately $0.0031 per share for gross proceeds of approximately $66,000

**Item 3. Defaults upon Senior Securities**

As of the date of the filing the Company has defaulted on the following debt obligations with a total outstanding balance including interest of approximately $29.9 million:

● January 2023 Note with a balance due of approximately $221,000

● Restructured August Note Payable with a balance due of approximately $27 million

● Restructured Senior Note Payable with a balance due of approximately $2.6 million

Further, the Company's Series G preferred shares, which had a redemption value of $820,000 were required to be redeemed as of December of 2024.

**Item 4. Mine Safety Disclosures**

Not Applicable.

**Item 5. Other Information**

None.

**Item 6. Exhibits**

**EXHIBIT INDEX**

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| | | | |
|:---|:---|:---|:---|
| | | **Incorporated by Reference** | **Incorporated by Reference** |
| <br>**Exhibit Number** | <br>**Exhibit Description** | **Form** | **Exhibit** |
| 31.1\* | [Rule 13a-14(a) / 15d-14(a) Certification of Chief Executive Officer.](ex31-1.htm) |  |  |
| 31.2\* | [Rule 13a-14(a) / 15d-14(a) Certification of Chief Financial Officer.](ex31-2.htm) |  |  |
| 32.1\*\* | [Section 1350 Certification of Chief Executive Officer.](ex32-1.htm) |  |  |
| 32.2\*\* | [Section 1350 Certification of Chief Financial Officer.](ex32-2.htm) |  |  |
| 101.INS\* | Inline XBRL Instance Document |  |  |
| 101.SCH\* | Inline XBRL Taxonomy Extension Schema Document |  |  |
| 101.CAL\* | Inline XBRL Taxonomy Extension Calculation Linkbase Document |  |  |
| 101.DEF\* | Inline XBRL Taxonomy Extension Definition Linkbase Document |  |  |
| 101.LAB\* | Inline XBRL Taxonomy Extension Label Linkbase Document |  |  |
| 101.PRE\* | Inline XBRL Taxonomy Extension Presentation Linkbase Document |  |  |

---

*\* Filed herewith.*

*\*\* Furnished herewith.*

**SIGNATURES**

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

**NATURALSHRIMP INCORPORATED**

---

| | |
|:---|:---|
| By: | */s/ Gerald Easterling* |
|  | Gerald Easterling |
|  | Chief Executive Officer |
|  | (Principal Executive Officer) |
| Date: | August 21, 2025 |

---

---

| | |
|:---|:---|
| By: | */s/ William Delgado* |
|  | William Delgado |
|  | Chief Financial Officer |
|  | (Principal Financial Officer and Principal Accounting Officer) |
| Date: | August 21, 2025 |

---

## Exhibit 31.1

**Exhibit 31.1**

**NATURALSHRIMP INCORPORATED**

**CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002**

I, Gerald Easterling, certify that:

1. I have reviewed this quarterly report on Form 10-Q of NaturalShrimp Incorporated;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a–15(e) and 15d–15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a–15(f) and 15d–15(f)) for the registrant and have:

(a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

---

| | |
|:---|:---|
| By: | */s/ Gerald Easterling* |
|  | Gerald Easterling |
|  | Chief Executive Officer |
|  | (Principal Executive Officer) |
| Date: | August 21, 2025 |

---

## Exhibit 31.2

**Exhibit 31.2**

**NATURALSHRIMP INCORPORATED**

**CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002**

I, William Delgado, certify that:

1. I have reviewed this quarterly report on Form 10-Q of NaturalShrimp Incorporated;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a–15(e) and 15d–15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a–15(f) and 15d–15(f)) for the registrant and have:

(a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

---

| | |
|:---|:---|
| By: | */s/ William Delgado* |
|  | William Delgado |
|  | Chief Financial Officer |
|  | (Principal Financial Officer and Principal Accounting Officer) |
| Date: | August 21, 2025 |

---

## Exhibit 32.1

**Exhibit 32.1**

**NATURALSHRIMP INCORPORATED**

**CERTIFICATION PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002**

In connection with this Quarterly Report on Form 10-Q of NaturalShrimp Incorporated (the "Company") as filed with the Securities and Exchange Commission on the date hereof (the "Report"), the undersigned, in the capacity and on the date indicated below, hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to his knowledge:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. The
 Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The
 information contained in the Report fairly presents, in all material respects, the financial condition and results of operation of
 the Company.

---

| | |
|:---|:---|
| By: | */s/ Gerald Easterling* |
|  | Gerald Easterling |
|  | Chief Executive Officer |
|  | (Principal Executive Officer) |
| Date: | August 21, 2025 |

---

## Exhibit 32.2

**Exhibit 32.2**

**NATURALSHRIMP INCORPORATED**

**CERTIFICATION PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002**

In connection with this Quarterly Report on Form 10-Q of NaturalShrimp Incorporated (the "Company") as filed with the Securities and Exchange Commission on the date hereof (the "Report"), the undersigned, in the capacity and on the date indicated below, hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to his knowledge:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. The
 Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The
 information contained in the Report fairly presents, in all material respects, the financial condition and results of operation of
 the Company.

---

| | |
|:---|:---|
| By: | */s/ William Delgado* |
|  | William Delgado |
|  | Chief Financial Officer |
|  | (Principal Financial Officer and Principal Accounting Officer) |
| Date: | August 21, 2025 |

---