{"url_path":"/sec/cik-0001440153/10-k/2026/item-16","section_key":"item-16","section_title":"Item 16 ****FORM 10-K SUMMARY**","topic":"sec","document":{"doc_type":"10-K","doc_date":"2026-07-20","source_url":"https://www.sec.gov/Archives/edgar/data/1440153/0001096906-26-001097-index.html","accession_number":"0001096906-26-001097","cik":"0001440153","ticker":null,"issuer_name":"Bakhu Holdings, Corp.","edgar_url":"https://www.sec.gov/Archives/edgar/data/1440153/0001096906-26-001097-index.html","primary_entity_key":"0001440153","primary_entity_name":"Bakhu Holdings, Corp."},"word_count":8300,"has_tables":true,"body_markdown":"**ITEM 16.****FORM 10-K SUMMARY**  \n\n \n\nNot applicable*.*\n\nPage **73**\n\n**SIGNATURES**\n\n \n\nPursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.\n\n \n\n \n\n \n\n \n\n \n\n \n\n**BAKHU HOLDINGS, CORP.**\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nDated: July 20, 2026\n\n \n\n \n\n/s/ Konstantia (Nadia) Galazi\n\n \n\n \n\n \n\nBy: Konstantia (Nadia) Galazi\n\n \n\n \n\n \n\nIts: President, CEO and Principal Executive Officer\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nDated: July 20, 2026\n\n \n\n \n\n/s/ Konstantia (Nadia) Galazi\n\n \n\n \n\n \n\nBy: Konstantia (Nadia) Galazi\n\nIts: Chief Financial Officer and Principal Accounting Officer\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nPursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nDated: July 20, 2026\n\n \n\n \n\n/s/ Konstantia (Nadia) Galazi\n\n \n\n \n\n \n\nBy: Konstantia (Nadia) Galazi, Director\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nDated: July 20, 2026\n\n \n\n \n\n/s/ Karl E. Watkin\n\n \n\n \n\n \n\nBy: Karl E. Watkin, Director\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nPage **74**\n\n**BAKHU HOLDINGS, CORP.**\n\n**FINANCIAL STATEMENTS**\n\n \n\n**July 31, 2024 and 2023**\n\n \n\n**C O N T E N T S**\n\n \n\n[Report of Independent Registered Public Accounting Firm](#a39) (PCAOB ID: 822)\n\nF-2\n\n[Consolidated Balance Sheets](#a40)\n\nF-3\n\n[Consolidated Statements of Operations](#a41)\n\nF-4\n\n[Consolidated Statements of stockholders’ Equity (Deficit)](#a42)\n\nF-5\n\n[Consolidated Statements of Cash Flows](#a43)\n\nF-6\n\n[Notes to Financial Statements](#a44)\n\nF-8\n\nF-1\n\n**REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**\n\n \n\n \n\nTo the Board of Directors and Stockholders\n\nof Bakhu Holdings, Corp.  \n\n \n\n**Opinion on the Financial Statements**\n\n \n\nWe have audited the accompanying balance sheets of Bakhu Holdings, Corp.  (the “Company”) as of July 31, 2024 and the related statements of operations, stockholders’ deficiency, and cash flows for the year ended July 31, 2024, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of Bakhu Holdings, Corp. as of July 31, 2024 and the results of its operations and cash flows for flows for the year ended July 31, 2024 in conformity with accounting principles generally accepted in the United States.\n\n \n\n**Going Concern Uncertainty**\n\n \n\nThe accompanying financial statements referred to above have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the financial statements, the Company’s present financial situation raises substantial doubt about its ability to continue as a going concern. Management’s plans in regard to this matter are also described in Note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.\n\n \n\n**Basis for Opinion**\n\n \n\nThese financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.\n\n \n\nWe conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.\n\n \n\nOur audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.\n\n \n\n**Critical Audit Matters**\n\n \n\nCritical audit matters are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgements. We determined that there were no critical audit matters. \n\n \n\nValley Stream, New York\n\nJuly 20, 2026\n\nWe have served as the Company’s auditor since 2026.\n\nPCAOB ID: 6631\n\nF-2\n\n**BAKHU HOLDINGS, CORP.**\n\n**Consolidated Balance Sheet**\n\n \n\nASSETS\n\n \n\n \n\n \n\n \n\n \n\nJuly 31,\n\n \n\nJuly 31,\n\n \n\n \n\n2024\n\n \n\n2023\n\n \n\n \n\n \n\n \n\n \n\nASSETS\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCURRENT ASSETS\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCash and cash equivalents\n\n \n\n$25,461  \n\n \n\n$3,101  \n\n \n\n \n\n \n\n \n\n \n\nTotal Current Assets\n\n \n\n25,461  \n\n \n\n3,101  \n\n \n\n \n\n \n\n \n\n \n\nOTHER ASSETS\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nFixed assets, net of accumulated depreciation of $-0- and $200,507, respectively\n\n \n\n-  \n\n \n\n467,850  \n\n \n\n \n\n \n\n \n\n \n\nTotal Other Assets\n\n \n\n-  \n\n \n\n467,850  \n\n \n\n \n\n \n\n \n\n \n\nTOTAL ASSETS\n\n \n\n$25,461  \n\n \n\n$470,951  \n\n \n\n \n\n \n\n \n\n \n\nLIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCURRENT LIABILITIES\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nAccounts payable and accrued liabilities\n\n \n\n$1,796,034  \n\n \n\n$2,639,281  \n\nAccrued interest\n\n \n\n640,430  \n\n \n\n412,813  \n\nSettlement liability due to leasing company\n\n \n\n260,000  \n\n \n\n-  \n\nNotes payable - related parties current portion\n\n \n\n150,000  \n\n \n\n6,744,672  \n\n \n\n \n\n \n\n \n\n \n\nTotal Current Liabilities\n\n \n\n2,846,464  \n\n \n\n9,796,766  \n\n \n\n \n\n \n\n \n\n \n\nNON-CURRENT LIABILITIES\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nNotes payable – related parties\n\n \n\n7,515,355  \n\n \n\n-  \n\nNotes payable – third parties\n\n \n\n675,192  \n\n \n\n-  \n\n \n\n \n\n \n\n \n\n \n\nTotal Non-Current Liabilities\n\n \n\n8,190,547  \n\n \n\n-  \n\n \n\n \n\n \n\n \n\n \n\nTOTAL LIABILITIES\n\n \n\n11,037,011  \n\n \n\n9,796,766  \n\n \n\n \n\n \n\n \n\n \n\nCOMMITMENTS AND CONTINGENCIES\n\n \n\n-  \n\n \n\n-  \n\n \n\n \n\n \n\n \n\n \n\nSTOCKHOLDERS' EQUITY (DEFICIT)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nPreferred stock, $0.001 par value; 50,000,000 shares authorized, 0 and 4 shares of Series A Preferred Stock issued and outstanding, respectively\n\n \n\n-  \n\n \n\n-  \n\nCommon stock, $0.001 par value; 500,000,000 shares authorized, 301,302,983 and 301,302,983 shares issued and outstanding, respectively\n\n \n\n301,303  \n\n \n\n301,303  \n\nAdditional paid-in capital\n\n \n\n39,598,304  \n\n \n\n37,852,370  \n\nAccumulated deficit\n\n \n\n(50,911,157) \n\n \n\n(47,479,488) \n\n \n\n \n\n \n\n \n\n \n\nTotal Stockholders' Equity (Deficit)\n\n \n\n(11,011,550) \n\n \n\n(9,325,815) \n\n \n\n \n\n \n\n \n\n \n\nTOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)\n\n \n\n$25,461  \n\n \n\n$470,951  \n\n \n\nThe accompanying notes are an integral part of these financial statements\n\nF-3\n\n**BAKHU HOLDINGS, CORP.**\n\n**Consolidated Statements of Operations**\n\n \n\n \n\n \n\nFor the Year Ended\n\n \n\n \n\nJuly 31,\n\n \n\n2024\n\n \n\n2023\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nNET REVENUES\n\n \n\n$-  \n\n \n\n$-  \n\n \n\n \n\n \n\n \n\n \n\nOPERATING EXPENSES\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nConsulting fees (including stock-based compensation of $1,745,934 and $8,107,162, respectively)\n\n \n\n1,830,827  \n\n \n\n8,441,838  \n\nProfessional fees\n\n \n\n318,070  \n\n \n\n487,704  \n\nDepreciation of fixed assets\n\n \n\n133,672  \n\n \n\n133,672  \n\nOther operating expenses\n\n \n\n794,047  \n\n \n\n982,598  \n\n \n\n \n\n \n\n \n\n \n\nTotal Operating Expenses\n\n \n\n3,076,615  \n\n \n\n10,045,812  \n\n \n\n \n\n \n\n \n\n \n\nLOSS FROM OPERATIONS\n\n \n\n(3,076,615) \n\n \n\n(10,045,812) \n\n \n\n \n\n \n\n \n\n \n\nOTHER INCOME (EXPENSES)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nGain on settlement of debt\n\n \n\n323,078  \n\n \n\n-  \n\nLoss on disposal of fixed assets\n\n \n\n(334,179) \n\n \n\n-  \n\nLoss on sale of equipment\n\n \n\n-  \n\n \n\n(65,748) \n\nInterest expense\n\n \n\n(343,953) \n\n \n\n(193,894) \n\n \n\n \n\n \n\n \n\n \n\nTotal Other Income (Expenses)\n\n \n\n(355,054) \n\n \n\n(259,642) \n\n \n\n \n\n \n\n \n\n \n\nLOSS BEFORE INCOME TAXES\n\n \n\n(3,431,669) \n\n \n\n(10,305,454) \n\n \n\n \n\n \n\n \n\n \n\nPROVISION FOR INCOME TAXES\n\n \n\n-  \n\n \n\n-  \n\n \n\n \n\n \n\n \n\n \n\nNET LOSS\n\n \n\n$(3,431,669) \n\n \n\n$(10,305,454) \n\n \n\n \n\n \n\n \n\n \n\nBASIC AND DILUTED NET LOSS PER COMMON SHARE\n\n \n\n$(0.01) \n\n \n\n$(0.03) \n\n \n\n \n\n \n\n \n\n \n\nWEIGHTED AVERAGE NUMBER OF COMMON\n\n \n\n \n\n \n\n \n\nSHARES OUTSTANDING - BASIC AND DILUTED\n\n \n\n301,302,983  \n\n \n\n301,296,736  \n\n \n\nThe accompanying notes are an integral part of these financial statements\n\nF-4\n\n**BAKHU HOLDINGS, CORP.**\n\n**Consolidated Statements of Stockholders' Equity (Deficit)**\n\n**For the Period July 31, 2022 through July 31, 2024**\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nAdditional\n\n \n\n \n\n \n\nTotal\n\n \n\n \n\nPreferred Stock\n\n \n\nCommon Stock\n\n \n\nPaid-In\n\n \n\nAccumulated\n\n \n\nStockholders'\n\n \n\nShares\n\n \n\nAmount\n\n \n\nShares\n\n \n\nAmount\n\n \n\nCapital\n\n \n\nDeficit\n\n \n\nEquity\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nBalance, July 31, 2022\n\n \n\n4  \n\n \n\n$- \n\n \n\n301,302,983 \n\n \n\n$301,283 \n\n \n\n$29,715,228 \n\n \n\n$(37,174,034) \n\n \n\n$(7,157,523) \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nVesting of stock options and warrants\n\n \n\n-  \n\n \n\n- \n\n \n\n- \n\n \n\n- \n\n \n\n8,107,162 \n\n \n\n-  \n\n \n\n8,107,162  \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nStock issued for cash\n\n \n\n-  \n\n \n\n- \n\n \n\n20,000 \n\n \n\n20 \n\n \n\n29,980 \n\n \n\n-  \n\n \n\n30,000  \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nNet loss for the year ended\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nJuly 31, 2023\n\n \n\n-  \n\n \n\n- \n\n \n\n- \n\n \n\n- \n\n \n\n- \n\n \n\n(10,305,454) \n\n \n\n(10,305,454) \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nBalance, July 31, 2023\n\n \n\n4  \n\n \n\n- \n\n \n\n301,302,983 \n\n \n\n301,303 \n\n \n\n37,852,370 \n\n \n\n(47,479,488) \n\n \n\n(9,325,815) \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nVesting of stock options and warrants\n\n \n\n-  \n\n \n\n- \n\n \n\n- \n\n \n\n- \n\n \n\n1,745,934 \n\n \n\n-  \n\n \n\n1,745,934  \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCancellation of Preferred Stock\n\n \n\n(4) \n\n \n\n- \n\n \n\n- \n\n \n\n- \n\n \n\n- \n\n \n\n-  \n\n \n\n-  \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nNet loss for the year ended\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nJuly 31, 2024\n\n \n\n-  \n\n \n\n- \n\n \n\n- \n\n \n\n- \n\n \n\n- \n\n \n\n(3,431,669) \n\n \n\n(3,431,669) \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nBalance, July 31, 2024\n\n \n\n-  \n\n \n\n$- \n\n \n\n301,302,983 \n\n \n\n$301,303 \n\n \n\n$39,598,304 \n\n \n\n$(50,911,157) \n\n \n\n$(11,011,550) \n\nThe accompanying notes are an integral part of these financial statements\n\nF-5\n\n**BAKHU HOLDINGS, CORP.**\n\n**Consolidated Statements of Cash Flows**\n\n \n\n \n\n \n\nFor the Year Ended\n\n \n\n \n\nJuly 31,\n\n \n\n2024\n\n \n\n2023\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCASH FLOWS FROM OPERATING ACTIVITIES\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nNet loss\n\n \n\n$(3,431,669) \n\n \n\n$(10,305,454) \n\nAdjustments to reconcile net loss to net cash used by operating activities:\n\n \n\n \n\n \n\n \n\nStock based compensation\n\n \n\n1,745,934  \n\n \n\n8,107,162  \n\nGain on settlement of debt\n\n \n\n(323,078) \n\n \n\n-  \n\nLoss on disposal of fixed assets\n\n \n\n334,179  \n\n \n\n-  \n\nLoss on sale of equipment\n\n \n\n-  \n\n \n\n65,748  \n\nDepreciation of fixed assets\n\n \n\n133,672  \n\n \n\n133,672  \n\nCompound interest added to notes principal\n\n \n\n75,731  \n\n \n\n-  \n\nChanges in operating assets and liabilities:\n\n \n\n \n\n \n\n \n\nAccounts payable and accrued liabilities\n\n \n\n(520,169) \n\n \n\n1,373,312  \n\nAccrued interest\n\n \n\n266,560  \n\n \n\n193,894  \n\nSettlement liability due to leasing company\n\n \n\n260,000  \n\n \n\n-  \n\n \n\n \n\n \n\n \n\n \n\nNet Cash Used in Operating Activities\n\n \n\n(1,458,840) \n\n \n\n(431,666) \n\n \n\n \n\n \n\n \n\n \n\nCASH FLOWS FROM INVESTING ACTIVITIES\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nProceeds from sale of equipment\n\n \n\n-  \n\n \n\n21,375  \n\n \n\n \n\n \n\n \n\n \n\nNet Cash Provided by Investing Activities\n\n \n\n-  \n\n \n\n21,375  \n\n \n\n \n\n \n\n \n\n \n\nCASH FLOWS FROM FINANCING ACTIVITIES\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nProceeds from sale of common stock\n\n \n\n-  \n\n \n\n30,000  \n\nProceeds from notes payable – third parties\n\n \n\n625,000  \n\n \n\n-  \n\nPayments on notes payable - related parties\n\n \n\n-  \n\n \n\n(2,883) \n\nProceeds from notes payable - related parties\n\n \n\n856,200  \n\n \n\n373,824  \n\n \n\n \n\n \n\n \n\n \n\nNet Cash Provided by Financing Activities\n\n \n\n1,481,200  \n\n \n\n400,941  \n\n \n\n \n\n \n\n \n\n \n\nINCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS\n\n \n\n22,360  \n\n \n\n(9,350) \n\n \n\n \n\n \n\n \n\n \n\nCASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD\n\n \n\n3,101  \n\n \n\n12,451  \n\n \n\n \n\n \n\n \n\n \n\nCASH AND CASH EQUIVALENTS AT END OF PERIOD\n\n \n\n$25,461  \n\n \n\n$3,101  \n\n \n\n \n\n \n\n \n\n \n\nSUPPLEMENTAL DISCLOSURES:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCash Payments For:\n\n \n\n \n\n \n\n \n\nInterest\n\n \n\n$-  \n\n \n\n$-  \n\nIncome taxes\n\n  \n\n$-  \n\n \n\n$-  \n\n \n\n \n\n \n\n \n\n \n\n \n\nThe accompanying notes are an integral part of these financial statements\n\nF-6\n\n**BAKHU HOLDINGS, CORP.**\n\n**Notes to Consolidated Financial Statements**\n\n**July 31, 2024 and 2023**\n\n \n\n**NOTE 1 - ORGANIZATION AND BUSINESS OPERATIONS; BASIS OF PRESENTATION**\n\n \n\nBakhu Holdings, Corp. (formerly Planet Resources, Corp.) (the “Company”) was incorporated under the laws of the State of Nevada, U.S. on April 24, 2008. In May 2009, the Company began to look for other types of business to pursue that would benefit the stockholders. To pursue businesses outside the mining industry the name of the Company was changed with the approval of the directors and stockholders to Bakhu Holdings, Corp. on May 4, 2009.\n\n \n\nThe Company has not generated any revenue to date, and consequently, its operations are subject to all risks inherent in establishing a new business enterprise. For the period from inception, April 24, 2008, through July 31, 2024, the Company has accumulated losses of $50,911,157.\n\n \n\nOn December 20, 2018, the Company acquired a license from Cell Science Holding Ltd. (“Cell Science”) in exchange for 210,000,000 shares of Company common stock.  The license provides for the Company’s exclusive right in North America and Central America to use certain patents and intellectual property for the production of cannabinoids for medical, food additive, and recreational uses.\n\n \n\nOn August 9, 2019, the Company formed Cell Science CBD International, Inc., a California corporation as a wholly owned subsidiary to commercialize use of the licensed technology to produce and manufacture cannabis and their byproducts that have measurable tetrahydrocannabinol (THC) concentration potency less than 3% on a dry weight basis. This subsidiary had no active operations as of July 31, 2024. When used herein, the “Company” includes this consolidated subsidiary.\n\n \n\n**NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**\n\n \n\nBasis of Presentation\n\n \n\nThe financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America and are presented in US dollars.\n\n \n\nGoing Concern\n\n \n\nThe financial statements have been prepared on a going concern basis which assumes the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future. The Company has incurred losses since inception resulting in an accumulated deficit of $50,911,157 as of July 31, 2024 and further losses are anticipated in the development of its business raising substantial doubt about the Company’s ability to continue as a going concern.\n\n \n\nCash and Cash Equivalents\n\n \n\nThe Company considers all highly liquid instruments with a maturity of three months or less at the time of issuance to be cash equivalents.\n\n \n\nUse of Estimates and Assumptions\n\n \n\nThe preparation of financial statements in conformity with accounting principles generally accepted in the United States 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.\n\n \n\n \n\nF-7\n\n**NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)**\n\n \n\nForeign Currency Translation\n\n \n\nThe Company’s functional currency and its reporting currency is the United States dollar.\n\n \n\nFinancial Instruments\n\n \n\nThe carrying value of the Company’s financial instruments approximates their fair value because of the short maturity of these instruments.\n\n \n\nStock-based Compensation\n\n \n\nIn September 2020, the Company adopted a stock-based compensation plan, the 2020 Long-Term Incentive Plan (“2020 Plan”), which is more fully described in Note 5.  We expense the fair value of stock options and warrants granted for services as they vest.  \n\n \n\nOn September 22, 2020, the Company granted to each of its directors, Thomas K. Emmitt, Peter Whitton, Aristotle Popolizio and Evripides Drakos, a non-qualified stock option to purchase 300,000 shares of common stock, for a total of 1,200,000 shares, at an exercise price of $5.10 per share, representing the then current price at which the Company was offering and selling its restricted shares for cash in its capital raising efforts. Such Options shall be exercisable for a period of seven years.  Twenty percent (20%) (i.e., 60,000) of the options shall vest and be exercisable immediately with the remaining 240,000 options vesting at the rate of 1/12 (i.e. 20,000 shares) per month so that all options shall be fully vested and exercisable on the first anniversary of the Grant Date. The fair value of each option grant issued under the 2020 Plan was estimated using the Black-Scholes option pricing model.\n\n \n\nOn June 7, 2021, we entered a consulting agreement with Fourth and G Holdings, LLC, through which Christopher Ganan provided consulting services. We granted the consultant one warrant to purchase 1,500,000 shares, vesting over two years, and another warrant to purchase 28,500,000 shares, vesting in increments based on specified technology commercialization accomplishments. The exercise price of these warrants is $3.00 per share, which was approximately equivalent to the market price of our common stock as of the date of grant. The fair value of each warrant grant was estimated using the Black-Scholes option pricing model.  \n\n \n\nOn September 11, 2021, the Company and Fourth and G Holdings, LLC, amended their June 2021 agreement, to reflect that the total warrants were reduced from 30,000,000 to 15,000,000, of which warrants to purchase 300,000 shares were vested on signing the initial agreement.  Effective June 7, 2023, with the consultant not having fulfilled any of the specified technology commercialization accomplishments, the remaining 14,250,000 warrants were cancelled.  \n\n \n\nOn July 27, 2021, the Company entered into Consulting Agreements with two consultants to assist the Science team and granted each Consultant a seven-year stock option to purchase 100,000 shares of Common Stock at an exercise price of $4.20 per share, which was approximately equal to the closing price for our common stock on the date of grant. The fair value of each option grant issued under the 2020 Plan was estimated using the Black-Scholes option pricing model.\n\n \n\nOn September 16, 2021, the Company granted to its then Chief Executive Office, Teddy Scott, a non-qualified stock option to purchase 5,000,000 shares of common stock at an exercise price of $4.50 per share, representing the current market price on the date of the issuance of the option. Such Options shall be exercisable for a period of ten years.  Six hundred twenty-five thousand (625,000) of the options shall vest and be exercisable immediately with the remaining options vesting at the rate of ninety-three thousand eighty-five (93,085) shares per month over a period of forty-seven (47) months. The fair value of each option grant issued under the 2020 Plan was estimated using the Black-Scholes option pricing model.  \n\n \n\n \n\nF-8\n\n \n\n**NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)**\n\n \n\nDr. Scott resigned as a director and chief executive officer on November 10, 2021. As of the date of his resignation, 718,085 options were vested and are exercisable through the expiration of such options on September 16, 2031, except in the event of his death, in which case such options will terminate if not exercised within six months.  The remaining 4,281,915 options terminated upon Dr. Scott’s resignation as a director.\n\n \n\nOn December 3, 2021, the Company appointed an additional director and granted him a seven-year stock option to purchase 300,000 shares of common stock at $3.00 per share, which was approximately equal to the closing price for our common stock on the date of grant. The fair value of each option grant issued under the 2020 Plan was estimated using the Black-Scholes option pricing model.  \n\n \n\nOn December 6, 2021, the Company appointed a new Chief Financial and Accounting Officer and director of the Company at an annual base salary of $60,000 and granted him a seven-year stock option to purchase 300,000 shares of common stock at $3.40 per share, which was approximately equal to the closing price for our common stock on the date of grant. The fair value of each option grant issued under the 2020 Plan was estimated using the Black-Scholes option pricing model.  \n\n \n\nOn December 7, 2021, the Company entered into Consulting Agreements with two consultants to assist the Science team. Pursuant to the Consulting Agreements, the Company granted each Consultant a seven-year stock option to purchase 200,000 shares of Common Stock at an exercise price of $3.40 per share, which was approximately equal to the closing price for our common stock on the date of grant. The fair value of each option grant issued under the 2020 Plan was estimated using the Black-Scholes option pricing model.  \n\n \n\nOn January 5, 2022, in consideration of the services of our Chief Executive Officer and our Vice President and Secretary of the Company, we granted them each a seven-year stock option to purchase 700,000 shares of common stock at $2.60 per share which was approximately equal to the closing price for our common stock on the date of grant. The fair value of each option grant issued under the 2020 Plan was estimated using the Black-Scholes option pricing model.  \n\n \n\nOn February 11, 2022, the Company appointed a new Deputy Chief Executive Officer and granted him a seven-year stock option to purchase 2,000,000 shares of common stock at an exercise price of $3.00 per share which was approximately equal to the closing price for our common stock on the date of grant.  The fair value of each option grant issued under the 2020 Plan was estimated using the Black-Scholes option pricing model.  \n\n \n\nOn February 11, 2022, the Company entered into a Consulting Agreement with an advisor to the board and granted him a seven-year stock option to purchase 3,500,000 shares of common stock at an exercise price of $3.00 per share which was approximately equal to the closing price for our common stock on the date of grant.  The fair value of each option grant issued under the 2020 Plan was estimated using the Black-Scholes option pricing model.  \n\n \n\nOn April 18, 2022, in consideration of the services of our Chief Executive Officer and our Vice President and Secretary of the Company, we granted them each a seven-year stock option to purchase 1,300,000 shares of common stock at $3.30 per share which was approximately equal to the closing price for our common stock on the date of grant. The fair value of each option grant issued under the 2020 Plan was estimated using the Black-Scholes option pricing model.  \n\n \n\nOn July 29, 2022, in consideration of the services of two of our Directors, we granted them each a seven-year stock option to purchase 300,000 shares of common stock at $1.50 per share which was approximately equal to the closing price for our common stock on the date of grant. The fair value of each option grant issued under the 2020 Plan was estimated using the Black-Scholes option pricing model.  \n\n \n\nF-9\n\n \n\n**NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)**\n\n \n\nOn July 29, 2022, in consideration of the services of a Senior Board Advisor and our Chief Financial Officer of the Company, we granted them each a seven-year stock option to purchase 160,000 shares of common stock at $1.50 per share which was approximately equal to the closing price for our common stock on the date of grant. The fair value of each option grant issued under the 2020 Plan was estimated using the Black-Scholes option pricing model.  \n\n \n\nBased on the above assumptions for all stock options and warrants, the Company recognized stock-based compensation of $8,107,162 and $9,169,182 (which is included in consulting fees on the Statements of Operations) for the years ended July 31, 2023 and July 31, 2022, respectively. As of July 31, 2023, there was $6,269,750 of total unrecognized stock-based compensation that is expected to be recognized over the vesting period of the options.\n\n \n\nThe Company recognized stock-based compensation of $1,745,934 and $8,107,162 (which is included in consulting fees on the Statements of Operations) for the years ended July 31, 2024 and 2023, respectively.  As of July 31, 2024, there was $2,603,902 of total unrecognized stock-based compensation that is expected to be recognized over the remaining vesting period of the options (which ends on February 11, 2026).\n\n \n\nIncome Taxes\n\n \n\nIncome taxes are accounted for under the assets and liability method.  Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry forwards.  Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled.\n\n \n\nBasic and Diluted Net Loss per Share\n\n \n\nThe Company computes net loss per share in accordance with ASC 105, “Earnings per Share.” ASC 105 requires presentation of both basic and diluted earnings per share (EPS) on the face of the income statement.\n\n \n\nBasic EPS is computed by dividing net loss available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all potentially dilutive common shares outstanding (such as stock options, warrants, and convertible notes payable) during the period. Diluted EPS excludes all potentially dilutive shares if their effect is anti-dilutive.\n\n \n\nProfessional fees\n\n \n\nSubstantially all professional fees presented in the financial statements represent accounting fees, audit fees and legal fees associated with the filing of reports with the Securities and Exchange Commission.  Also included in professional fees are fees paid to the stock transfer agent.  The fees are expensed as incurred.\n\n \n\nFiscal Periods\n\n \n\nThe Company’s fiscal year end is July 31.\n\n \n\nRecently Issued Accounting Pronouncements\n\n \n\nThe Company has reviewed accounting pronouncements issued during the past two years and have adopted any that are applicable to the Company.  We have determined that none had a material impact on our financial position, results of operations, or cash flows for the periods presented in this report.\n\n \n\n**NOTE 3 – FIXED ASSETS**\n\n \n\nOn January 31, 2022, the Company and Cell Science entered into the Third Amendment to the December 20, 2018 Patent and Technology License Agreement (see Note 7).  As part of this transaction, the Company acquired all related\n\nF-10\n\n \n\n**NOTE 3 – FIXED ASSETS (continued)**\n\n \n\nequipment, improvements, supplies, and related tangible and intangible assets.  The Company determined that the lab equipment acquired had a cost basis of $765,160.  These costs were depreciated using the straight-line method over their estimated economic lives which is estimated to be 5 years.  \n\n \n\nIn December 2023 we reached a settlement agreement to restructure the indebtedness owed to VO Leasing Corp., our landlord, and holder of necessary cannabis cultivation and manufacturing licenses in CA. During the year ended July 31, 2024, we defaulted under the terms of the settlement agreement and abandoned the laboratory facility and VO leasing has since disposed of all equipment, machinery and supplies which secured the obligations under the settlement agreement.  The Company has recorded a loss on the disposal of fixed assets in the amount of $334,179 which was the net book value of the equipment.  \n\n \n\nFixed Assets consisted of the following:\n\n \n\nJuly 31, 2024\n\n \n\nJuly 31, 2023\n\nLaboratory equipment and components – at cost\n\n$668,358  \n\n \n\n$668,357  \n\nAccumulated depreciation\n\n(334,179) \n\n \n\n(200,507) \n\nLoss on disposal of fixed assets\n\n(334,179) \n\n \n\n-  \n\nFixed assets – net\n\n$-  \n\n \n\n$467,850  \n\n \n\n**NOTE 4 - NOTES PAYABLE**\n\n \n\nNotes payable – related parties consist of:\n\n \n\nJuly 31, 2024\n\n \n\nJuly 31, 2023\n\nNote payable to Cell Science Holding Ltd. dated January 31, 2022, interest at 0.44%, due December 31, 2027\n\n$3,170,000  \n\n \n\n$3,500,000  \n\nConvertible note payable to The OZ Corporation dated August 1, 2019, interest at 6%, due December 31, 2027\n\n3,780,872  \n\n \n\n3,094,672  \n\nNote payable to The OZ Corporation dated June 23, 2022, interest at 7%, due December 15, 2024\n\n150,000  \n\n \n\n150,000  \n\nConvertible Senior Secured Promissory Note payable to OZ Company, interest at 13%, due February 26, 2028\n\n564,483  \n\n \n\n-  \n\n \n\n \n\n \n\n \n\nTotal notes payable – related parties\n\n7,665,355  \n\n \n\n6,744,672  \n\n \n\n \n\n \n\n \n\nCurrent portion of notes payable – related parties\n\n(150,000) \n\n \n\n(6,744,672) \n\n \n\n \n\n \n\n \n\nNon-current portion of notes payable – related parties\n\n$7,515,355  \n\n \n\n$-  \n\n \n\nNotes payable – third parties consist of:\n\nJuly 31, 2024\n\n \n\nJuly 31, 2023\n\nConvertible Senior Secured Promissory Notes payable to third parties, interest at 13%, due February 26, 2028\n\n$675,192 \n\n \n\n$- \n\n \n\n \n\n \n\n \n\nTotal notes payable – third parties\n\n$675,192 \n\n \n\n$- \n\n \n\nOn January 31, 2022, the Company and Cell Science entered into the Third Amendment to the December 20, 2018 Patent and Technology License Agreement (see Note 7).  As part of this transaction, the Company issued a $3,500,000 promissory note, bearing interest at the applicable federal short-term rate of 0.44% under IRC Section 1274(d), originally due in January 2023 which by successive amendments has been extended to December 31, 2027. The principal balance and accrued interest due on the note were $3,170,000 and $38,204, respectively, as of July 31, 2024.  \n\nF-11\n\n \n\n**NOTE 4 - NOTES PAYABLE (continued)**\n\n \n\nThe Convertible note payable to The OZ Corporation dated August 1, 2019 arose from a promissory note in favor of The OZ Corporation to evidence monies loaned to the Company from December 26, 2018 through July 31, 2019 in the amount of $147,513, and to evidence any additional amounts that may be loaned to the Company thereafter.  \n\n \n\nPursuant to the terms of the promissory note, the principal and unpaid accrued simple interest at the rate of 6.0% per annum was due and payable on or before December 31, 2019 which by successive amendments the due date was extended to December 31, 2027.  The principal amount of the promissory note has been increased by the amount of any additional advances of funds made by The OZ Corporation to the Company, from time to time, from the date of such advance.  Under the terms of the promissory note, The OZ Corporation, at its option may, at any time, convert all or any portion of the then unpaid principal balance and any unpaid accrued interest into shares of the Company’s common stock.  The number of shares of common stock to be issued upon such conversion shall be equal to the quotient obtained by dividing (i) the then unpaid principal balance and any unpaid accrued interest of the promissory note being converted by (ii) 80% of the average closing price of the common stock of the Company, for the ninety (90) trading days before the conversion date, rounded up to the nearest whole share.  The principal balance and accrued interest due on the note were $3,780,872 and $563,222, respectively, as of July 31, 2024.\n\n \n\nOn June 23, 2022, the Company executed a promissory note in favor of The OZ Corporation, in the amount of $150,000.  Pursuant to the terms of the promissory note, the principal and unpaid accrued simple interest at the rate of 7.0% per annum shall be due and payable on or before December 15, 2024. The principal balance and accrued interest due on the note were $150,000 and $22,122, respectively, as of July 31, 2024.\n\n \n\nThe Convertible Senior Secured Promissory Notes payable to OZ Company (related party) and six third parties at July 31, 2024 were sold by the Company from August 8, 2023 to February 29, 2024.  These notes accrue interest at the rate of 13% per annum which is compounded quarterly with the compounded quarterly interest being added to the outstanding principal balance of the note on the last day of each fiscal quarter of the Company.  The principal and related accrued interest are convertible at the option of the holder into shares of Company common stock at a conversion price of $0.50 per share.  These notes are secured by a first priority lien on all assets of the Company.  The principal balance and accrued interest due on the Convertible Senior Secured Promissory Notes totaled $1,239,675 and $0, respectively as of July 31, 2024.  \n\n \n\nUpon conversion of the notes, the Company will issue one warrant for each dollar amount converted, with an exercise price of $0.50 per share for warrants issued on conversion of the first $1.5 million of 13% Convertible Secured Notes issued, an exercise price of $0.75 per share for warrants issued on conversion of the second $3.5 million tranche of 13% Convertible Secured Notes issued and an exercise price of $1.00 per share for warrants issued on conversion of 13% Convertible Secured Notes issued after the first $5.0 million in notes issued.\n\n \n\n**NOTE 5 - PREFERRED AND COMMON STOCK**\n\n \n\nPreferred Stock\n\n \n\nIn connection with the December 20, 2018 Patent and Technology Agreement, the Company issued 4 shares of its Series A Preferred Stock to Cell Science.  Each share of Series A Preferred Stock had voting rights equal to four (4) times the aggregate votes of the total number of shares of common stock issued and outstanding plus the total number of votes of all other classes of preferred stock issued and outstanding, divided by the number of shares of Series A Preferred Stock issued and outstanding.  On September 18, 2023, Cell Science agreed to cancel the four outstanding shares of Series A Preferred Stock owned by it. As a result of this preferred stock cancellation, Cell Science no longer has the voting power to control all stockholder votes, and we are amending our certificates of designation so that the Series A Preferred Stock and Series B Preferred Stock are no longer authorized for future issuance.  We now have outstanding only common stock, which is entitled to one vote per share on all matters.\n\nF-12\n\n \n\n**NOTE 5 - PREFERRED AND COMMON STOCK (continued)**\n\n \n\nStock Option Plan\n\n \n\nOn September 22, 2020, the board of directors adopted the 2020 Long-Term Incentive Plan (“2020 Plan”), under which 20,000,000 shares of our common stock were reserved for issuance by us to attract and retain employees and directors and to provide such persons with incentives and awards for superior performance and providing services to us. The 2020 Plan is administered by a committee comprised of our board of directors or appointed by the board of directors, which has broad flexibility in designing stock-based incentives. The board of directors determines the number of shares granted and the option exercise price pursuant to the 2020 Plan.\n\n \n\nOn February 27, 2024, the Company closed Tranche 1 of the ongoing private placement sale of $1,030,000 of Convertible Senior Secured Promissory Notes (see Note 4).  In conjunction with the Tranche 1 closing, the Company appointed three new directors and granted to each of the new directors Teddy Scott, Mitch Kahn, and Kimberly Tanami, and incumbent directors, Aristotle Popolizio, Peter Whitton and Juan Carlos Garcia La Sienra Garcia, a non-qualified stock option to purchase 240,000 shares of common stock at an exercise price of $1.00 per share. Such options shall be exercisable for seven years. The options shall vest at the rate of 1/12 (i.e., 20,000 shares) per month commencing on the Grant Date, so that all options shall be fully vested and exercisable on the first anniversary of the Grant Date.  \n\n \n\nOn March 5, 2024, John Munoz (controlling person of The OZ Corporation and OZ Company) and Aristotle Popolizio (officer and director of the Company) closed an Option Cancellation and Share Transfer Agreement.  In exchange for Popolizio’s cancellation of a total of 2,100,000 stock options exercisable at prices ranging from $2.60 per share to $5.10 per share, Munoz transferred 2,500,000 shares of Company common stock owned by him to Popolizio.   \n\n \n\nThe following table summarizes the stock option award activity under the 2020 Plan during the year ended July 31, 2024:\n\n \n\n \n\n \n\nNumber of options\n\nOutstanding at July 31, 2023\n\n \n\n 10,943,075 \n\nGranted\n\n \n\n 1,440,000\n\nExercised\n\n \n\n -\n\nForfeited\n\n \n\n (2,340,000)\n\nExpired\n\n \n\n (1,164,990)\n\nOutstanding at July 31, 2024\n\n \n\n 8,878,085\n\n \n\nThe following table summarizes the warrants activity during the nine months ended July 31, 2024:\n\n \n\n \n\n \n\nNumber of Warrants\n\nOutstanding at July 31, 2023\n\n \n\n750,000 \n\nGranted (13% Noteholder Warrants)\n\n \n\n2,250,000 \n\nExercised\n\n \n\n- \n\nExpired\n\n \n\n- \n\nOutstanding at July 31, 2024\n\n \n\n3,000,000 \n\nF-13\n\n \n\n**NOTE 5 - PREFERRED AND COMMON STOCK (continued)**\n\n \n\nThe remaining 8,878,085 stock options outstanding at July 31, 2024 are as follows:\n\n \n\nDate of Grant\n\n \n\nNumber Outstanding\n\n \n\nNumber Exercisable\n\n \n\nExercise Price\n\n \n\nExpiration Date\n\nSeptember 22, 2020\n\n \n\n200,000\n\n \n\n200,000\n\n \n\n$5.10\n\n \n\nSeptember 22, 2027\n\nJuly 27, 2021\n\n \n\n200,000\n\n \n\n200,000\n\n \n\n$4.20\n\n \n\nJuly 27, 2028\n\nSeptember 16, 2021\n\n \n\n718,085\n\n \n\n718,085\n\n \n\n$4.50\n\n \n\nSeptember 16, 2031\n\nDecember 3, 2021\n\n \n\n140,000\n\n \n\n140,000\n\n \n\n$3.00\n\n \n\nDecember 3, 2028\n\nDecember 6, 2021\n\n \n\n140,000\n\n \n\n140,000\n\n \n\n$3.40\n\n \n\nDecember 6, 2028\n\nDecember 7, 2021\n\n \n\n400,000\n\n \n\n400,000\n\n \n\n$3.40\n\n \n\nDecember 7, 2028\n\nJanuary 5, 2022\n\n \n\n700,000\n\n \n\n700,000\n\n \n\n$2.60\n\n \n\nJanuary 5, 2029\n\nFebruary 11, 2022\n\n \n\n624,990\n\n \n\n624,990\n\n \n\n$3.00\n\n \n\nFebruary 11, 2029\n\nFebruary 11, 2022\n\n \n\n3,500,000\n\n \n\n1,624,982\n\n \n\n$3.00\n\n \n\nFebruary 11, 2029\n\nApril 18, 2022\n\n \n\n1,300,000\n\n \n\n1,300,000\n\n \n\n$3.30\n\n \n\nApril 18, 2029\n\nJuly 29, 2022\n\n \n\n320,000\n\n \n\n320,000\n\n \n\n$1.50\n\n \n\nJuly 29, 2029\n\nFebruary 27, 2024\n\n \n\n1,440,000\n\n \n\n240,000\n\n \n\n$1.00\n\n \n\nFebruary 28, 2031\n\nTotals\n\n \n\n8,878,085\n\n \n\n6,608,057\n\n \n\n \n\n \n\n \n\n \n\nThe remaining 750,000 warrants outstanding and exercisable at April 30, 2024 were granted September 11, 2021, have an exercise price of $3.00 per share, and expire June 7, 2028.  \n\n \n\n**NOTE 6 - INCOME TAXES**\n\n \n\nAs of July 31, 2024, the Company had net operating loss carry forwards that may be available to reduce future years’ taxable income.  Future tax benefits which may arise as a result of these losses have not been recognized in these financial statements, as their realization is determined not more likely than not to occur and accordingly, the Company has recorded a valuation allowance for the deferred tax asset relating to these tax loss carry-forwards.\n\n \n\n**NOTE 7 - COMMITMENTS AND CONTINGENCIES**\n\n \n\nOffice Cost Sharing Agreement\n\n \n\nOn September 22, 2020, the Company executed an Office Cost Sharing Agreement with The OZ Corporation.  The agreement provides for the Company’s payments to The OZ Corporation of $34,000 per month for the shared use of office space located in Long Beach California for so long as The OZ Corporation provides the Company with shared use of the premises.  For the years ended July 31, 2024 and 2023, the space sharing fees were $408,000 and $408,000, respectively.  As of July 31, 2024, accounts payable and accrued liabilities included $1,409,000 due to The OZ Corporation for unpaid space sharing fees.  \n\n \n\nPatent and Technology license Agreements\n\n \n\nUnder the April 2020 strategic alliance agreement and related sublicense between the Company’s subsidiary, CBD Biotech, Inc., and Integrity Cannabis Solutions, Inc. (“ICS”), the Company is obligated to issue to ICS that number of shares of Bakhu common stock equal to 0.5% of the number of shares outstanding as of the date that the production facility of ICS is completed and commences production. Further, if the sublicense is terminated, CBD Biotech will be obligated to repay to ICS its initial $250,000 license fee and reimburse ICS for the cost of the laboratory operational equipment used in its production facility, which thereafter will be owned and managed jointly by ICS and CBD Biotech.\n\nF-14\n\n \n\n**NOTE 7 - COMMITMENTS AND CONTINGENCIES (continued)**\n\n \n\nAs a result of successfully completing the efficacy demonstration of our licensed technology in July 2021, we became obligated to issue to Cell Science, the licensor, a one-year note for an agreed one-time payment of $3.5 million, less certain credits. The amount of the credits to the note were determined and on January 31, 2022, the Company and Cell Science entered into the Third Amendment to the December 20, 2018 Patent and Technology License Agreement, as subsequently amended, in which the Company and Cell Science agreed as follows:\n\n \n\n·There would be no reduction or offset against the $3.5 million One-time Payment for costs paid by the Company or on its behalf.  Therefore, the Company issued a $3.5 million promissory note, bearing interest at the applicable federal short-term rate of 0.44% under IRC Section 1274(d), originally payable on January 31, 2023, as extended by successive amendments to December 31, 2027.     \n\n \n\n·In lieu of any offset or reduction against the One-Time Payment Note, Cell Science agreed to convey to the Company the lease on the California laboratory in which the efficacy demonstration was conducted, including all related equipment, improvements, supplies, and related tangible and intangible assets.    \n\n \n\n·Cell Science and The OZ Corporation would execute and deliver to the Company a similar conveyance of all rights to the California laboratory.  \n\n \n\n·The Integrated License Agreement was clarified to provide that all improvements to the licensed technology made by the Company would be owned by Cell Science and included in the license.   \n\n \n\nThe lease on the California laboratory space located in Sherman Oaks, California, as amended March 12, 2020 and assumed by the Company on January 31, 2022, provided for a monthly space sharing fee of $10,000 and had a term of thirty-six (36) months from March 12, 2020 to March 12, 2023 with an option to extend for an additional period not to exceed three (3) months.  In addition, the agreement provided for a monthly cannabis activities fee equal to the greater of (i) $11,640 or (ii) ten percent (10%) of the gross sales of the products, if any, manufactured through lessee’s operations.  From March 12, 2023 through August 2023, the agreement continued on a month-to-month basis.  For the years ended July 31, 2024 and 2023, the space sharing fees were $10,000 and $120,000, respectively, and the cannabis activities fees were $11,640 and $139,680, respectively.  \n\n \n\nIn 2023 a minority stockholder of Mentone has advised us of his claim that he was unlawfully removed from the board of directors of Mentone and that it was unauthorized to enter into certain agreements with Cell Science that led to its license of the subject cell replication technology to us.  The Mentone minority stockholder has threatened litigation seeking equitable remedies and money damages against Mentone and its other stockholders. In 2023 we received by commercial courier a copy of a purported complaint for a lawsuit filed in Cyprus by the minority stockholder of Mentone, purportedly on behalf of Mentone, which names the Company, one of our prior directors and vice president, and one of our former directors and executive officers, as defendants in said complaint.  We were subsequently advised verbally that the complaint had been or was dismissed as to our company and our former officers and directors named in the complaint but have not received any written confirmation of such dismissal.  This action by Mentone is further in contravention of and violates the terms of the Agreement, Assignment Waiver and Estoppel (the “Estoppel Agreement”) entered into by Mentone with Cell Science, the Licensor, our company, and others on September 22, 2020, that provides us with the potential remedy to seek cancellation of any of our shares received by Mentone and its owners. We believe the complaint is without merit, and if necessary, we intend to challenge its claimed jurisdiction over us, defend ourselves vigorously on the merits, assert all defenses and counterclaims, assert cross-claims against other parties to the Estoppel Agreement, and seek remedies provided under the Estoppel Agreement against all other parties to that agreement as warranted.\n\nF-15\n\n \n\n**NOTE 7 - COMMITMENTS AND CONTINGENCIES (continued)**\n\n \n\nOn July 7, 2026, we receive an email from legal counsel for Cell Science Holding Ltd. (“Cell Science”) and Inter-M Traders FZ LLE, forwarding an email alleged to have been sent to Bakhu and certain related parties on June 8, 2026.  Said purported June 8, 2026 email is stated to be a Formal Notice of Breach, Misrepresentation, Demand for Preservation of Evidence, and Reservation of Rights. In said June 8, 2026 notice, Cell Science as owner of the intellectual property and Licensor under the Integrated License Agreement make various claims against Bakhu and Peter Whitton, the inventor of the licensed technology, including without limitation that Bakhu failed in the development, validation, commercialization, operational implementation, and proof of concept of the licensed technology within Bakhu’s operations and intended commercial markets; that Peter Whitton and/or unnamed related parties failed to provide adequate manuals, validation documentation, technical support materials, scientific substantiation, and sufficient operational proof necessary for independent verification and validation of the technology in the manner contemplated under the Integrated License Agreement; that Cell Science disputes the sufficiency, reliability, completeness, and commercial significance of such purported validation and efficacy demonstrations; that Cell Science further disputes whether the technology was independently validated, commercially substantiated, or operationally proven to the extent represented to investors, shareholders, directors, counterparties, or third parties; that Mr. Whitton and/or other unnamed related parties misrepresented to Bakhu shareholders, investors, directors, and third parties that the technology had been validated, proven effective, commercially viable, and operationally confirmed. Based upon information presently available to Cell Science, such representations may have been inaccurate, incomplete, misleading, unsupported, or made without adequate scientific, technical, or operational substantiation.\n\n \n\nThe claims by Cell Science and/or Inter-M Traders FZ, LLC are in contravention of and violates the terms of the Agreement, Assignment Waiver and Estoppel (the “Estoppel Agreement”) entered into by Cell Science, Bakhu and others, on September 22, 2020 that provides us with the potential remedy to seek cancellation of any of our shares received by Cell Science and its owners, and assigns. We believe the claims are without merit, and if necessary, we intend to defend against any complaint vigorously on the merits, assert all defenses and counterclaims, assert cross-claims against other parties to the Estoppel Agreement, and seek remedies provided under the Estoppel Agreement against all other parties to that agreement as warranted.\n\n \n\n**NOTE 8 – GAIN ON SETTLEMENT OF DEBT**\n\n \n\nOn December 7, 2023, we reached an agreement with VO Leasing Corp., our laboratory space landlord and holder of necessary cannabis cultivation and manufacturing licenses in CA, in settlement of the $623,078 owed VO Leasing as of October 31, 2023. Per the agreement, it was agreed that we would pay VO Leasing the total amount of $300,000 with interest thereon at the rate of 10% per annum as full satisfaction of the amounts owed. Under the agreement, we paid $40,000. The balance of $260,000 plus all accrued and unpaid interest is payable within 180 days (the “Due Date”). With the payment of the initial $40,000 we were permitted to retrieve the Bioreactors from the premises. Additionally, per the agreement, upon our payment, any time before the Due Date, of an additional $50,000 applied against the balance due, we can retrieve all of our remaining equipment, except the Filtration System, which shall be Collateral for our full performance under the agreement, and which shall be released upon full payment prior to the Due Date.  Based on the agreement, the Company recorded a gain on the settlement of debt in the amount of $323,078 in the three months ended January 31, 2024.  As of July 31, 2024, the Company has not paid any of the $260,000 balance and accrued interest of $16,882 due VO Leasing Corp.  \n\nF-16\n\n**NOTE 9 – SUBSEQUENT EVENTS**\n\n \n\n**March 18, 2026 Indemnification, Hold Harmless and Advancement Letter Agreement**\n\n \n\nOn March 18, 2026, following the resignation of Efstathios Galazi, as the then sole officer and director of the Company and appointment of Konstantia Galazi as the sole director and officer of the Company, the Company entered into an Indemnification, Hold Harmless and Advancement Letter Agreement, whereby the Company agreed to indemnify, hold harmless and defend Efstathios Galazi against any and all losses, liabilities, damages, claims, demands, actions, suits, proceedings, judgments, fines, penalties, settlements, costs and expenses (including, without limitation, reasonable attorneys' fees, expert fees, investigation costs and disbursements) incurred by reason of the fact that the Efstathios Galazi is or was a director, officer, agent, adviser, authorized signatory or representative of the Company, or served at the request of the Company in any such capacity for another entity or enterprise.\n\n \n\n**April 7, 2026 Binding Heads of Agreement**\n\n \n\nOn April 7, 2026, the Company entered into a Binding Heads of Agreement with PhytoCyte Pty Ltd.,  under which the parties agreed to certain funding and other commitments, interim corporate governance and undertakings to bring the Company into good standing, and the subsequent change of control of the Company. Pursuant to the Binding Heads of Agreement PhytoCyte has agreed to provide or procure funding in the amount of up to $250,000 to be paid either to a Bakhu escrow account, or directly to its creditors, on behalf of Bakhu and any amount advanced directly by PhytoCyte shall be evidenced shall be an interest-free and convertible promissory note (the “PhytoCyte Note”), which proceeds would be used for expenses required to restore the Company to full regulatory compliance and good standing.  Further, Pursuant to the Binding Heads of Agreement, the Compliance Restoration Milestone shall be satisfied when: (a) the overdue SEC filings have been prepared and filed, or otherwise validly satisfied in a manner that restores the Company's reporting position; (b) the liabilities and expenses necessary to restore the Company to active and good standing, including any other fees, taxes, filing charges or compliance costs essential to that outcome, have been paid, settled, compromised or irrevocably provided for; the corporate actions required by this Agreement and schedules have been completed; and (d) documentary evidence of the matters referred to above has been placed with the Company's records and furnished to the Parties. The Binding Heads of Agreement, provides that on the first Business Day following satisfaction of the Compliance Restoration Milestone, the amounts paid by PhytoCyte shall automatically convert and the Company shall issue and register such number of voting common shares as shall result in PhytoCyte holding seventy percent (70%) of the issued and outstanding voting common stock of the Company on a fully diluted basis immediately after conversion.  As a result of such conversion, the existing shareholders of the Company shall be diluted so that their collective ownership immediately after conversion is thirty percent (30%) of the then issued and outstanding voting common stock of the Company on a fully diluted basis.\n\n \n\nAs of the date of the filing of this Annual Report the promissory note to be entered into between the Company and PhytoCyte has not been executed.\n\n \n\n**May 28, 2026 Termination of Convertible Note Term Sheet and Amendments**\n\n \n\nOn May 28, 2026, the Company terminated any rights of  JR Munoz, the OZ Company, Inter-M Traders FZ LLC and/or Cell Science Holding Ltd., pursuant to the Convertible Note Term Sheet dated July 20, 2023, the First Amendment to Term Sheet dated August 17, 2023, the Second Amendment to Term Sheet dated September 13, 2023 and the Third Amendment to Term Sheet dated February 14, 2024, to designate, appoint, or remove any directors and/or officers of the Corporation, to choose, reject or veto any candidate to the board or as an officer of the Corporation, or in any way interfere with the corporate governance of the Corporation and the board.\n\nF-17\n\n \n\n**NOTE 9 – SUBSEQUENT EVENTS (continued)**\n\n \n\n**July 14, 2025 Convertible Promissory Notes with OZ Company and PhytoCyte**\n\n \n\nOn July 14, 2025, the Company executed a Promissory Note (the “2026 OZ Working Capital Note”) in favor of OZ Company, a California corporation (“OZ Company”), evidencing OZ Company’s loan to or advances on behalf of Bakhu in the principal amount of $64,691.50, to pay the costs associated with the Company’s efforts to bring its delinquent required periodic reports current. Per the terms of the note, OZ Company will continue to loan to or make advances on behalf of Bakhu, to pay the costs associated with the Company’s efforts to bring its delinquent required periodic reports current. Under the terms of the note, simple interest will accrue at a rate of 6% per annum until the note is paid in full. All unpaid principal and unpaid accrued interest will be due and payable on December 31, 2026, subject to extension per the terms of the note until June 30, 2027. The 2026 OZ Working Capital Note is convertible at the option of OZ Company at any time, and the note will automatically convert into shares of common stock at one cent ($0.01) per share upon the Company's filing of all delinquent and currently due required periodic reports. OZ Company is owned and controlled by John R. Munoz.\n\n \n\nOn July 14, 2025, the Company executed a Promissory Note (the “2026 OZ Working Capital Note”) in favor of PhytoCyte Pty Ltd., a company incorporated under the laws of Australia (\"PhytoCyte\") evidencing PhytopCyte’s loan to or advances on behalf of Bakhu in the principal amount of $78,924.72, to pay the costs associated with the Company’s efforts to bring its delinquent required periodic reports current. Per the terms of the note, PhytoCyte will continue to loan to or make advances on behalf of Bakhu, to pay the costs associated with the Company’s efforts to bring its delinquent required periodic reports current. Under the terms of the note, simple interest will accrue at a rate of 6% per annum until the note is paid in full. All unpaid principal and unpaid accrued interest will be due and payable on December 31, 2026, subject to extension per the terms of the note until June 30, 2027. The 2026 PhytoCyte Working Capital Note is convertible at the option of PhytoCyte any time, and the note will automatically convert into shares of common stock at one cent ($0.01) per share upon the Company's filing of all delinquent and currently due required periodic reports. PhytoCyte is owned and controlled by Karl E. Watkin, a current director.\n\nF-18"}