{"url_path":"/sec/pmnt/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":"2026-06-29","source_url":"https://www.sec.gov/Archives/edgar/data/1849221/0001493152-26-030418-index.html","accession_number":"0001493152-26-030418","cik":"0001849221","ticker":"PMNT","issuer_name":"Perfect Moment Ltd.","edgar_url":"https://www.sec.gov/Archives/edgar/data/1849221/0001493152-26-030418-index.html","primary_entity_key":"0001849221","primary_entity_name":"Perfect Moment Ltd."},"word_count":17733,"has_tables":true,"body_markdown":"**ITEM\n16. FORM 10-K SUMMARY**\n\n \n\nNone.\n\n \n\n59\n\n \n\n \n\n**Index\nto Financial Statements**\n\n \n\n[Report of Independent Registered Public Accounting Firm](#F_001) (PCAOB Firm ID: 572)\nF-2\n\n \n \n\nConsolidated\nFinancial Statements:\n \n\n \n \n\n[Consolidated Balance Sheets as of March 31, 2026 and 2025](#F_002)\nF-3\n\n \n \n\n[Consolidated Statements of Operations and Comprehensive Loss for the years ended March 31, 2026 and 2025](#F_003)\nF-4\n\n \n \n\n[Consolidated Statements of Changes in Stockholders’ (Deficit) Equity for the years ended March 31, 2026 and 2025](#F_004)\nF-5\n\n \n \n\n[Consolidated Statements of Cash Flows for the years ended March 31, 2026 and 2025](#F_005)\nF-6\n\n \n \n\n[Notes to Consolidated Financial Statements for the years ended March 31, 2026 and 2025](#F_006)\nF-7\n\n \n\nF-1\n\n \n\n** **\n\n**REPORT\nOF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**\n\n \n\nTo\nthe Board of Directors and Shareholders\n\nPerfect\nMoment Ltd and Subsidiaries\n\n \n\n**Opinion\non the Financial Statements**\n\n \n\nWe\nhave audited the accompanying consolidated balance sheets of Perfect Moment Ltd and Subsidiaries (the “Company”) as of March\n31, 2026 and 2025, the related consolidated statements of operations and comprehensive loss, stockholders’ (deficit) equity, and\ncash flows for the years then ended and the related notes (collectively referred to as the “financial statements”). In our\nopinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company\nas of March 31, 2026 and 2025, and the results of its consolidated operations and its cash flows for the years then ended in conformity\nwith accounting principles generally accepted in the United States of America.\n\n \n\n**Going\nConcern**\n\n \n\nThe\naccompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As\ndiscussed in Note 2, the Company has incurred recurring losses, had a net loss and used cash in operations during the year ended\nMarch 31, 2026, and the Company had a stockholders’ deficit at March 31, 2026. These matters raise substantial doubt about the\nCompany’s ability to continue as a going concern. Management’s plans in regard to these matters are also described in\nNote 2 to the consolidated financial statements. These consolidated financial statements do not include any adjustments that might\nresult from the outcome of this uncertainty.\n\n \n\n**Basis\nfor Opinion**\n\n \n\nThese\nconsolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion\non the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting\nOversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with\nthe U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.\n\n \n\nWe\nconducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain\nreasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company\nis not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits\nwe are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion\non the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.\n\n \n\nOur\naudits included performing procedures to assess the risks of material misstatement, whether due to error or fraud, and performing procedures\nthat respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the\nconsolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made\nby management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable\nbasis for our opinion.\n\n \n\nWe\nhave served as the Company’s auditor since 2023.\n\n \n\n/s/\nWeinberg & Company, P.A.\n\nWeinberg\n& Company, P.A.\n\nLos\nAngeles, California\n\nJune\n29, 2026\n\n \n\nF-2\n\n \n\n** **\n\n**PERFECT\nMOMENT LTD. AND SUBSIDIARIES**\n\n**CONSOLIDATED\nBALANCE SHEETS**\n\n**(Amounts\nin thousands, except share and per share data)**\n\n \n\n  \nMarch 31, 2026  \nMarch 31, 2025 \n\nASSETS \n    \n   \n\n  \n    \n   \n\nCurrent assets: \n    \n   \n\nCash and cash equivalents \n$1,151  \n$6,159 \n\nRestricted cash \n -  \n 1,350 \n\nAccounts receivable, net \n 2,146  \n 886 \n\nInventories, net \n 3,897  \n 1,567 \n\nPrepaid and other current assets \n 2,950  \n 2,812 \n\nTotal current assets \n 10,144  \n 12,774 \n\nLong term assets: \n    \n   \n\nOperating lease right-of-use assets \n 1,003  \n 44 \n\nProperty and equipment, net \n 499  \n 483 \n\nOther non-current assets \n 582  \n 36 \n\nTotal assets \n$12,228  \n$13,337 \n\nLIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY \n    \n   \n\nCurrent liabilities: \n    \n   \n\nTrade payables \n$3,601  \n$2,594 \n\nAccrued expenses \n 2,859  \n 4,233 \n\nTrade finance facility \n -  \n 2,495 \n\nShort-term borrowings, net \n -  \n 1,851 \n\nOperating lease obligations, current \n 37  \n 44 \n\nDeferred revenue \n 245  \n 264 \n\nTotal current liabilities \n 6,742  \n 11,481 \n\nLong term liabilities: \n    \n   \n\nLine of credit from related party, non-current \n 5,140  \n - \n\nOperating lease obligations, non-current \n 1,032  \n - \n\nTotal liabilities \n 12,914  \n 11,481 \n\nCommitments and contingencies (see Note 14  ) \n -  \n - \n\nStockholders’ (deficit) equity: \n    \n   \n\nSeries AA convertible preferred stock, $0.0001 par value, 1,800,000 shares authorized; Nil shares and 924,921 shares issued and outstanding as of March 31, 2026 and 2025, respectively \n -  \n - \n\nCommon stock; $0.0001 par value, 100,000,000 shares authorized: 47,048,174 and 19,291,000 shares issued and outstanding as of March 31, 2026 and 2025, respectively \n 4  \n 2 \n\nAdditional paid-in-capital \n 71,663  \n 66,793 \n\nAccumulated other comprehensive loss \n (306) \n (23)\n\nAccumulated deficit \n (72,047) \n (64,916)\n\nTotal stockholders’ (deficit) equity \n (686) \n 1,856 \n\nTotal liabilities and stockholders’ (deficit) equity \n$12,228  \n$13,337 \n\n \n\nThe\naccompanying notes are an integral part of these consolidated financial statements\n\n \n\nF-3\n\n \n\n** **\n\n**PERFECT\nMOMENT LTD. AND SUBSIDIARIES**\n\n**CONSOLIDATED\nSTATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS** \n\n**(Amounts\nin thousands, except share and per share data)**\n\n \n\n  \n\n**Year Ended**\n\n**March 31, 2026**\n  \n\n**Year Ended**\n\n**March 31, 2025**\n \n\n  \n   \n  \n\nRevenue, net \n$23,603  \n$21,501 \n\nCost of sales \n 7,644  \n 11,072 \n\nGross profit \n 15,959  \n 10,429 \n\nOperating expenses: \n    \n   \n\nSelling, general and administrative expenses \n 17,965  \n 20,685 \n\nMarketing and advertising expenses \n 3,234  \n 3,540 \n\nTotal operating expenses \n 21,199  \n 24,225 \n\nLoss from operations \n (5,240) \n (13,796)\n\nOther income (expense), net: \n    \n   \n\nInterest expense and finance costs (including $1,002 and $0 of interest to related parties) \n (2,280) \n (2,046)\n\nForeign currency transactions gain (loss) \n 4  \n (107)\n\nOther income \n 385  \n 10 \n\nTotal other expense, net \n (1,891) \n (2,143)\n\nNet Loss \n(7,131) \n(15,939)\n\nDividends on Series AA Convertible Preferred Stock \n (506) \n - \n\nNet loss attributable to common stockholders \n$(7,637) \n$(15,939)\n\nBasic and diluted loss per share attributable to common stockholders \n$(0.23) \n$(0.99)\n\nBasic and diluted weighted-average number of shares outstanding \n \n**33,074,619**\n  \n 16,095,138 \n\nOther comprehensive loss \n    \n   \n\nNet loss \n$(7,131) \n$(15,939)\n\nForeign currency translation (loss) gain \n (283) \n 62 \n\nComprehensive loss \n$(7,414) \n$(15,877)\n\n \n\nThe\naccompanying notes are an integral part of these consolidated financial statements\n\n** **\n\nF-4\n\n \n\n \n\n**PERFECT\nMOMENT LTD. AND SUBSIDIARIES**\n\n**CONSOLIDATED\nSTATEMENTS OF STOCKHOLDERS’ (DEFICIT) EQUITY**\n\n**For\nthe Years Ended March 31, 2026 and 2025**\n\n**(Amounts\nin thousands, except share data)**\n\n \n\n  \nShares  \nAmount  \nShares  \nAmount  \nShares  \nAmount  \nShares  \nAmount  \nCapital  \nLoss  \nDeficit  \n(Deficit) \n\n  \nPreference Shares  \n   \n   \nAccumulated  \n   \nTotal \n\n  \nSeries AA Convertible  \nSeries A\nConvertible  \nSeries B\nConvertible  \nCommon Shares  \nAdditional Paid-in  \nOther Comprehensive  \nAccumulated  \nStockholders’ Equity \n\n  \nShares  \nAmount  \nShares  \nAmount  \nShares  \nAmount  \nShares  \nAmount  \nCapital  \nLoss  \nDeficit  \n(Deficit) \n\nBalance -March 31, 2024 \n -  \n$         -  \n     -  \n$          -  \n    -  \n$        -  \n 15,653,449  \n$1  \n$56,824  \n$(85) \n$(48,977) \n$7,763 \n\nStock compensation for employee vested options \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n            -  \n 715  \n -  \n -  \n 715 \n\nStock compensation   for employee vested RSUs \n -  \n -  \n -  \n -  \n -  \n -  \n 285,449  \n -  \n 619  \n -  \n -  \n 619 \n\nFair value of shares issued for services \n -  \n -  \n -  \n -  \n -  \n -  \n 1,352,102  \n -  \n 1,488  \n -  \n -  \n 1,488 \n\nIssuance of Series AA Convertible Preferred Stock and warrants, net \n 924,921  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n 5,148  \n -  \n -  \n 5,148 \n\nIssuance of common stock upon conversion of convertible debt \n -  \n -  \n -  \n -  \n -  \n -  \n 2,000,000  \n 1  \n 1,999  \n -  \n -  \n 2,000 \n\nForeign currency translation adjustment \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n 62  \n -  \n 62 \n\nNet loss \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n (15,939) \n (15,939)\n\nBalance - March 31, 2025 \n 924,921  \n -  \n -  \n -  \n -  \n -  \n 19,291,000  \n 2  \n 66,793  \n$(23) \n (64,916) \n 1,856 \n\n  \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n    \n   \n\nStock compensation for employee vested options \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n 226  \n -  \n -  \n 226 \n\nStock compensation for employee vested RSUs \n -  \n -  \n -  \n -  \n -  \n -  \n 367,935  \n -  \n 250  \n -  \n -  \n 250 \n\nCancellation of employee vested options \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n (23) \n -  \n -  \n (23)\n\nFair value of shares issued for services \n -  \n -  \n -  \n -  \n -  \n -  \n 100,000  \n -  \n 62  \n -  \n -  \n 62 \n\nFair value of RSUs issued to related party as a finance cost \n -  \n -  \n -  \n -  \n -  \n -  \n 652,253  \n -  \n 305  \n -  \n -  \n 305 \n\nIssuance of common stock upon extinguishment of Related Party Note \n -  \n -  \n -  \n -  \n -  \n -  \n 1,692,694  \n -  \n 508  \n -  \n -  \n 508 \n\nIssuance of common stock and   warrants in public offering, net \n -  \n -  \n -  \n -  \n -  \n -  \n 10,313,128  \n 1  \n 2,620  \n -  \n -  \n 2,621 \n\nIssuance of common stock and warrants under securities purchase agreement, net \n -  \n -  \n -  \n -  \n -  \n -  \n 3,172,858  \n -  \n 1,429  \n -  \n -  \n 1,429 \n\nConversion of Series AA Convertible Preferred Stock into common stock \n (924,921) \n -  \n -  \n -  \n -  \n -  \n 11,458,306  \n 1  \n (1) \n -  \n -  \n - \n\nForeign currency translation adjustment \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n (283) \n -  \n (283)\n\nDividends on Series AA Convertible Preferred Stock \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n (506) \n -  \n -  \n (506)\n\nNet loss \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n -  \n (7,131) \n (7,131)\n\nBalance – March 31, 2026 \n -  \n$-  \n -  \n$-  \n -  \n$-  \n 47,048,174  \n$4  \n$71,663  \n$(306) \n$(72,047) \n$(686)\n\n \n\nThe\naccompanying notes are an integral part of these consolidated financial statements\n\n \n\nF-5\n\n \n\n** **\n\n**PERFECT\nMOMENT LTD. AND SUBSIDIARIES**\n\n**CONSOLIDATED\nSTATEMENTS OF CASH FLOWS**\n\n**(Amounts\nin thousands)**\n\n \n\n  \nYear Ended  \nYear Ended \n\n  \nMarch 31, 2026  \nMarch 31, 2025 \n\nOperating activities: \n    \n   \n\nNet loss \n$(7,131) \n$(15,939)\n\nAdjustments to reconcile net loss to net cash used in operating activities: \n    \n   \n\nDepreciation and amortization \n 323  \n 342 \n\nBad debt expense \n 541  \n (21)\n\nInventory reserve \n 457  \n 1,599 \n\nStock based compensation \n 476  \n 1,334 \n\nAmortization of stock-based marketing services shares issued for services \n 558  \n 910 \n\nAmortization of debt finance costs \n 1,849  \n 1,801 \n\nOther \n 6  \n (10)\n\nEffect of changes in assets and liabilities: \n    \n   \n\nAccounts receivable, net \n (1,821) \n 160 \n\nInventories, net \n (2,812) \n (937)\n\nPrepaid and other current assets \n (670) \n (1,493)\n\nOperating lease right-of-use assets \n 102  \n 99 \n\nOther non-current assets \n (198) \n 3 \n\nOperating lease obligations \n (52) \n (100)\n\nTrade payables \n 860  \n 1,010 \n\nAccrued expenses \n (1,469) \n 1,536 \n\nDeferred revenue \n (17) \n (155)\n\nNet cash used in operating activities \n (8,998) \n (9,861)\n\nInvesting activities: \n    \n   \n\nPurchases of property and equipment \n (359) \n (302)\n\nNet cash used in investing activities \n (359) \n (302)\n\nFinancing activities: \n    \n   \n\nProceeds from issuance of common stock and warrants, net \n 4,050  \n - \n\nProceeds from issuance of preference shares and warrants, net \n -  \n 5,148 \n\nProceeds from convertible debt obligations \n -  \n 2,000 \n\nProceeds from trade finance facilities, net \n -  \n 2,845 \n\nRepayment of trade finance facilities \n (2,495) \n (351)\n\nProceeds from short-term borrowings, net \n 1,330  \n 5,792 \n\nRepayment of short-term borrowings \n (4,725) \n (5,742)\n\nProceeds from line of credit – related party \n 5,140  \n - \n\nProceeds from notes payable – related party, net \n 5,590  \n - \n\nRepayment of notes payable – related party \n (5,090) \n - \n\nPayment of dividends on Series AA Convertible Preferred Stock \n (506) \n - \n\nNet cash provided by financing activities \n 3,294  \n 9,692 \n\nEffect of exchange rate changes on cash \n (295) \n 70 \n\nNet change in cash \n (6,358) \n (401)\n\nCash and cash equivalents and restricted cash - beginning of period \n 7,509  \n 7,910 \n\nCash and cash equivalents and restricted cash - end of period \n$1,151  \n$7,509 \n\nSupplemental disclosures of cash flow information: \n    \n   \n\nInterest paid on borrowings and bank loans \n$1,660  \n$154 \n\nReconciliation of cash, cash equivalents, and restricted cash reported in the consolidated balance sheets \n    \n   \n\nCash and cash equivalents \n$1,151  \n$6,159 \n\nRestricted cash \n -  \n 1,350 \n\nTotal cash, cash equivalents and restricted cash presented in the consolidated statements of cash flows \n$1,151  \n$7,509 \n\nSupplemental disclosure of non-cash investing and financing activities: \n    \n   \n\nRecognition of operating lease right of use assets and lease obligations \n$1,077  \n$- \n\nRecognition of debt discounts on short-term borrowings \n$658  \n$2,886 \n\nFair value of shares issued to extinguish a note payable and\naccrued interest – related party \n$508  \n$- \n\nFinancing costs included in accounts payable and accrued expenses \n$353  \n$- \n\nFair value of RSUs issued as a finance cost on notes payable – related party \n$305  \n$- \n\nFair value of shares issued in exchange for services to be received \n$62  \n$1,488 \n\nCancellation of employee vested options \n$23  \n$- \n\nConversion of convertible debt to common stock \n$-  \n$2,000 \n\n \n\nThe\naccompanying notes are an integral part of these consolidated financial statements\n\n \n\nF-6\n\n \n\n** **\n\n**PERFECT\nMOMENT LTD. AND SUBSIDIARIES**\n\n**NOTES\nTO CONSOLIDATED FINANCIAL STATEMENTS**\n\n**FOR\nTHE YEARS ENDED MARCH 31, 2026 AND 2025**\n\n**(Unless\notherwise indicated, dollar amounts in thousands)**\n\n \n\n**1.\nNATURE OF OPERATIONS AND BASIS OF PRESENTATION**\n\n \n\n**Nature\nof operations**\n\n \n\nPerfect\nMoment Ltd., a Delaware corporation (“Perfect Moment” or “PML” and, together with its subsidiaries unless the\ncontext otherwise requires, the “Company”), is an owner and operator of a luxury fashion brand that offers ski, surf, and\nactivewear collections under the brand name Perfect Moment. The Company’s collections are sold directly to customers.\n\n \n\n **Basis\nof presentation**\n\n \n\nThese\nconsolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”)\nand present the consolidated financial position, income (loss), comprehensive income (loss), and cash flows of the Company and its wholly\nowned subsidiaries. The figures in the notes to the financials are presented in thousands.\n\n \n\nReferences\nto GAAP issued by the FASB in these accompanying notes to the financial statements are to the Financial Accounting Standard Board (“FASB”)\nAccounting Standards Codification (“ASC”). The consolidated financial statements have been prepared assuming the Company\nwill continue as a going concern.\n\n \n\n**Principles\nof consolidation**\n\n \n\nThese\nconsolidated financial statements include the accounts of Perfect Moment Ltd. and its wholly owned subsidiaries; Perfect Moment Asia\nLimited (“PMA”), Perfect Moment (UK) Limited (“PMUK”), Perfect Moment USA, Inc. (“PMUSA”), Perfect\nMoment International AG (“PMCH”), Perfect Moment Netherlands B.V (“PMBV”), and Perfect Moment TM Sarl (“PMTM”).\nAll significant intercompany balances and transactions have been eliminated in consolidation.\n\n \n\n**2.\nSUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**\n\n \n\n**Going\nconcern** \n\n \n\nThrough\nMarch 31, 2026, the Company has funded its operations with proceeds from the sale of common stock from the initial public offering,\nand other sales of common stock; the sale of preferred stock, alongside existing trade, invoice and other financing\narrangements.  The Company has incurred recurring losses, including a net loss of $7,131\nfor the year ended March 31, 2026 and used cash in operations of $8,998\nduring that period. As of March 31, 2026, the Company had an accumulated deficit of $72,047 and a stockholders’ deficit of $686.\nThese factors raise substantial doubt about the Company’s ability to continue as a going concern for at least twelve months\nfrom the date these consolidated financial statements were available to be issued. The Company’s ability to continue as a\ngoing concern is dependent upon the management of its expenses and its ability to obtain necessary financing to meet its obligations\nand pay its liabilities arising from normal business operations when they come due, and upon profitable operations.\n\n \n\nThe\nCompany’s future capital requirements will depend on many factors, including production costs and planned growth. In order to finance\nthese opportunities and associated costs, it is possible that the Company would need to raise additional financing if working capital\nis insufficient to support its business needs. While there can be no assurances, the Company intends to raise such capital through additional\nshort-term loan issuances, debt factoring, and additional equity raises. If additional financing is required from outside sources, the\nCompany may not be able to raise it on terms acceptable to it or at all. If the Company is unable to raise additional capital on acceptable\nterms when needed, its product development, results of operations and financial condition would be materially and adversely affected.\n\n \n\nF-7\n\n \n\n \n\nAs\na result of the above, in connection with the Company’s assessment of going concern considerations in accordance with FASB’s\nAccounting Standards Update (“ASU”) 2014-15, *Disclosures of Uncertainties about an Entity’s Ability to Continue\nas a Going Concern*, management has determined that the Company’s liquidity condition raises substantial doubt about the Company’s\nability to continue as a going concern through twelve months from the date these consolidated financial statements are available to be\nissued. These consolidated financial statements do not include any adjustments relating to the recovery of the recorded assets or the\nclassification of the liabilities that might be necessary should the Company be unable to continue as a going concern.\n\n \n\n**Emerging\nGrowth Company**\n\n \n\nThe\nCompany is an emerging growth company, as defined in the Jumpstart Our Business Startups (“JOBS”) Act. Under\nthe JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of\nthe JOBS Act, until such time as to those standards apply to private companies. The Company has elected to use this extended transition\nperiod for complying with new or revised accounting standards that have different effective dates for public and private companies until\nthe earlier of the date that it (i) is no longer an emerging growth company or (ii) affirmatively and irrevocably opts out of the extended\ntransition period provided in the JOBS Act. As a result, these consolidated financial statements may not be comparable to companies that\ncomply with the new or revised accounting pronouncements as of public company effective dates.\n\n \n\n**Use\nof Estimates**\n\n \n\nThe\npreparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and judgments\nin applying the Company’s accounting policies that affect the reported amounts and disclosures made in the consolidated financial\nstatements and accompanying notes. Management continually evaluates the estimates and judgments it uses. These estimates and judgments\nhave been applied in a manner consistent with prior periods and there are no known trends, commitments, events or uncertainties that\nmanagement believes will materially affect the methodology or assumptions utilized in making these estimates and judgments in these consolidated\nfinancial statements. Significant estimates inherent in the preparation of the consolidated financial statements include reserves for\nuncollectible accounts receivables, realizability of inventory; sales reserves; useful lives and impairments of long-lived assets; realization\nof deferred tax assets and related uncertain tax positions; classification of warrants, and the valuation of stock-based compensation\nawards. Actual results may differ from these judgements and estimates under different assumptions or conditions and any such differences\nmay be material.\n\n \n\n**Seasonality**\n\n** **\n\nThe\nCompany experiences certain effects of seasonality with respect to its business. The Company generally experiences greater sales during\nits last three fiscal quarters, primarily driven by ski and outerwear sales being higher during the winter months and the Company’s\ncustomers concentrated in the northern hemisphere, and the lowest sales during its first fiscal quarter.\n\n** **\n\n**Revenue\nRecognition**\n\n \n\nRevenues\nare recognized when the Company’s performance obligations are satisfied as evidenced by transfer of control of promised goods to\ncustomers or consumers, in an amount that reflects the consideration the Company expects to be entitled to receive in exchange for those\ngoods or services. Control transfers once a customer has the ability to direct the use of, and obtain substantially all of the benefits\nfrom, the product. This includes the transfer of legal title, physical possession, the risks and rewards of ownership, and customer acceptance.\nFor transactions within the Company’s wholesale channel, control generally transfers to the customer upon shipment to, or upon\nreceipt by, the customer depending on the terms of sale with the customer. For inventories sold on consignment to wholesalers, the Company\nrecords revenue when the inventory is sold to the third-party customer by the wholesaler. For transactions within the Company’s\ndirect-to-consumer (“DTC”) channel, control generally transfers to the consumer at the time of sale within retail stores\nand generally upon receipt by the consumer with respect to e-commerce transactions. In certain arrangements, the Company receives payment\nbefore the customer receives the promised good. These payments are initially recorded as deferred revenue, a contract liability, and\nrecognized as revenue in the period when control is transferred to the customer.\n\n \n\nF-8\n\n \n\n \n\nThe\namount of consideration the Company expects to be entitled to receive and recognize as revenue, net across both wholesale and DTC channels\nvaries with changes in sales returns, other accommodations and incentives offered. The Company estimates expected sales returns and other\naccommodations, such as chargebacks and markdowns, and records a sales reserve to reduce revenue*.*These estimates are based on\nhistorical rates of product returns and claims, as well as events and circumstances that indicate changes to such historical rates are\nwarranted. However, actual returns and claims in any future period are inherently uncertain and thus may differ from estimates. As a\nresult, the Company adjusts estimates of revenue at the earlier of when the most likely amount of consideration the Company expects to\nreceive changes or when the amount of consideration becomes fixed. If actual or expected future returns and claims are significantly\ndifferent than the sales reserves established, the Company records an adjustment to revenue, net in the period in which it made such\ndetermination. As of March 31, 2026 and 2025, the provision for returns was $341 and $594, respectively, and included as a component\nof accrued expenses on the accompanying consolidated balance sheets.\n\n \n\nPartnership\nrevenue is recognized over time based on the greater of contractual minimum guarantees and actual, or estimated, sales of products by\nthe Company’s partners.\n\n \n\nThe\nCompany may issue merchant credits, which are essentially refund credits. The merchant credits are initially deferred and subsequently\nrecognized as revenue when tendered for payment.\n\n \n\nThe\nCompany expenses sales commissions when incurred, which is generally at the time of sale, because the amortization period would have\nbeen one year or less. These costs are recorded within selling, general and administrative expenses on the accompanying statements of\noperations and comprehensive loss.\n\n \n\nAs\nof March 31, 2026 and 2025, the Company did not have any contract assets and had $245 and $264, respectively, of deferred revenue on\nthe accompanying consolidated balance sheets.\n\n \n\nRevenue\nrecognized from contracts with customers is recorded net of sales taxes, value added taxes, or similar taxes that are collected on behalf\nof local taxing authorities.\n\n \n\nFor\nthe years ended March 31, 2026 and 2025 revenue, net recognized from performance obligations related to prior periods were not material.\nRevenue, net expected to be recognized in any future period related to remaining performance obligations is not material.\n\n \n\nDisaggregated\nrevenue\n\n \n\nThe\nfollowing table disaggregates the Company’s revenue, net by channel and geographic location:\n\n SCHEDULE\nOF REVENUE NET BY CHANNEL AND GEOGRAPHICAL LOCATION\n\n  \nYear ended\nMarch 31, 2026  \nYear ended\nMarch 31, 2025 \n\n  \n   \n  \n\nChannel revenue, net \n    \n   \n\nWholesale revenues \n$14,393  \n$10,111 \n\nEcommerce revenues \n 8,256  \n 10,060 \n\nRetail revenues \n 69  \n 775 \n\nPartnership revenues \n 885  \n 555 \n\nTotal revenue, net \n$23,603  \n$21,501 \n\nGeographic location revenue, net \n    \n   \n\nEurope (excluding United Kingdom) \n$9,995  \n$7,202 \n\nUnited States \n 7,782  \n 8,236 \n\nUnited Kingdom \n 3,443  \n 4,168 \n\nRest of the world \n 2,383  \n 1,895 \n\nTotal revenue, net \n$23,603  \n$21,501 \n\n \n\n**Cost\nof sales**\n\n \n\nCost\nof sales consists of all direct costs to source and purchase raw materials and finished goods, production costs (including labor), non-refundable\ntaxes, duties, other landing costs, as well as specific provisions for excess, close-out or slow-moving inventory.\n\n \n\nCost\nof sales also includes freight costs associated with the shipment of goods to the Company’s warehouses and distribution centers,\nincluding freight costs associated with the transfer of inventory within the Company’s third-party fulfillment and distribution\ncenters and to the Company’s retail stores.\n\n \n\nF-9\n\n \n\n \n\n**Selling,\ngeneral and administrative expenses**\n\n \n\nSelling,\ngeneral and administrative expenses consist of personnel-related costs, depreciation and amortization, occupancy, warehousing, professional\nfees, technology, human resources, legal, and other selling and general operating expenses related to the Company’s business functions.\nSelling, general and administrative expenses also include costs associated with the handling of inventory and warehousing costs associated\nwith the operation of the Company’s third-party fulfillment and distribution centers.\n\n \n\n**Marketing\nand advertising expenses**\n\n \n\nMarketing\nand advertising expenses consist of agency, contractor and consulting expense, content production, promotional operating expense, and\nadvertising costs.\n\n \n\nAdvertising\ncosts, including the costs to produce advertising, are expensed in the period incurred. Total advertising expense was $1,264 and $1,646\nfor the years ended March 31, 2026 and 2025, respectively.\n\n** **\n\n**Cash\nand cash equivalents and restricted cash**\n\n \n\nCash\nand cash equivalents consist of cash on hand and bank balances with original maturities of three months or less. The Company has not\nexperienced any losses related to these balances, and management believes the Company’s credit risk to be minimal.\n\n \n\nRestricted\ncash consists of cash deposits and certificate of deposits under the Company’s trade finance facility (see Note 8). Restricted\ncash is classified as current on the accompanying consolidated balance sheets as the trade finance facility can be due on demand. There\nwas $nil and $1,350 of restricted cash as of March 31, 2026 and 2025, respectively.\n\n \n\nThe\nCompany maintains the majority of its cash at Chase or HSBC where the balances are insured by the Federal Deposit Insurance\nCorporation (FDIC) up to $250,000.\nAt times, the cash balances may exceed the FDIC-insured limit. As of March 31, 2026, we do not believe we have any significant\nconcentrations of credit risk due to the strong credit rating of Chase and HSBC. The cash held by other banks is within the FDIC\ninsured amount and cash held by third party payment platforms are short term timing balances.\n\n \n\n**Accounts\nreceivable and allowance for credit losses**\n\n \n\nAccounts\nreceivable primarily arise out of sales customers. The allowance for credit losses is an amount equal to the estimated probable losses\nnet of recoveries in accounts receivable using the incurred loss methodology. After considering current economic conditions and specific\nand financial stability of its customers, an allowance for credit losses is maintained in the consolidated balance sheet at a level which\nmanagement believes is sufficient to cover all probable future credit losses as of the balance sheet date based on specific reserves\nand an expectation of future economic conditions that might impact collectability. Accounts receivable are carried net of allowances\nfor credit losses as of March 31, 2026 and 2025. After all reasonable attempts to collect a receivable have failed, the amount of the\nreceivable is written off against the allowance. As of March 31, 2026 and 2025, the Company had $1,082 and $547, respectively, in allowances\nfor credit losses.\n\n \n\n**Concentration\nof credit risk:**\n\n \n\n*Supplier*\n\n \n\nIn\nthe years ended March 31, 2026 and 2025, the largest single supplier of the Company’s manufactured goods produced 31% and 39%,\nrespectively, of the company’s products. In the years ended March 31, 2026 and 2025, the largest fabric supplier supplied 0%\nand 82%, respectively, of the fabric used to manufacture the Company’s products.\n\n \n\n*Customer*\n\n \n\nFor\nthe years ended March 31, 2026 and 2025, we had two individual customers that accounted for approximately\n12% of total revenue, net. These customers individually did not comprise more than 10%\nof total accounts receivable as of March 31, 2026 and 2025.\n\n \n\nAs\nof March 31, 2026 one customer accounted for approximately 14% of total accounts receivable. As of March 31, 2025, two customers accounted\nfor approximately 12%\nand 14%\nof total accounts receivable, respectively.\n\n \n\nF-10\n\n \n\n \n\n**Inventories,\nnet**\n\n \n\nInventories,\nconsisting of finished goods, inventories in transit, and raw materials, are stated at the lower of cost or net realizable value. Cost\nis determined on a first-in, first-out basis, and includes all costs incurred to deliver inventory to the Company’s third-party\nfulfillment and distribution centers, including freight, non-refundable taxes, duty and other landing costs.\n\n \n\nThe\nCompany periodically reviews its inventories and makes a provision as necessary to appropriately value goods that are obsolete, have\nquality issues, or are damaged. The amount of the provision is equal to the difference between the cost of the inventory and its net\nrealizable value based upon assumptions about product quality, damages, future demand, selling prices, and market conditions. If changes\nin market conditions result in reductions in the estimated net realizable value of its inventory below its previous estimate, the Company\nwould increase its provision in the period in which it made such a determination.\n\n \n\nIn\naddition, the Company provides for inventory shrinkage based on historical trends from actual physical inventory counts. Inventory shrinkage\nestimates are made to reduce the inventory value for lost or stolen items. The Company performs physical inventory counts and cycle counts\nthroughout the year and adjusts the shrink provision accordingly.\n\n \n\n**Prepaid\nand other current assets**\n\n \n\nAmounts\nrecorded in prepaid and other current assets consist of employee advances, unbilled accounts receivable, prepaid insurance, and other\ncurrent assets, all of which are expected to be realized within one year from the reporting period.\n\n \n\n**Property\nand Equipment**\n\n \n\nProperty\nand equipment are recorded at cost less accumulated depreciation. Cost of property and equipment consists of purchase price, conversion\ncost and estimated cost of dismantling and restoration. Expenditures such as repairs and maintenance, overhaul costs and borrowing costs\nare expensed as incurred. Expenditures that extend the useful life of an asset are capitalized. Direct internal and external costs related\nto software used for internal purposes and website development which are incurred during the application development stage or for upgrades\nthat add functionality are capitalized. All other costs related to internal use software are expensed as incurred. Property and equipment\ncarrying values are reviewed for impairment when events or circumstances indicate that the asset group to which the property and equipment\nbelong might be impaired.\n\n \n\nThe\nfollowing estimated useful lives are used for to depreciate property and equipment on a straight-line basis:\n\n SCHEDULE OF PROPERTY AND EQUIPMENT USEFUL LIFE\n\n \n** **\n**Useful\nLife** \n\nFurniture\nand fixtures\n \n5\nyears\n\nOffice\nequipment\n \n3-5\nyears\n\nComputer\nequipment\n \n3\nyears\n\nSoftware\nand website development\n \n3\nyears\n\nLeasehold\nimprovements\n \nLessor\nof 5 years or remaining term of underlying lease\n\n \n\n**Other non-current assets**\n\n** **\n\nAmounts recorded in other non-current\nassets consist of deferred offering costs, deferred financing costs, and other assets, all of which are expected to be realized beyond\none year from the reporting period.\n\n \n\nOffering costs, including certain\nlegal, professional, accounting and other third-party fees that are directly associated with in-process equity issuances, are deferred\nas deferred offering costs until such equity issuances are consummated. After consummation of the equity issuance, the deferred offering\ncosts associated with the equity issuance will be recorded as a reduction to additional paid in capital. Should the equity issuance be\ndelayed or abandoned, the deferred offering costs will be expensed immediately as a charge to operating expenses in the Company’s\nstatement of operations.\n\n \n\nFinancing\ncosts, including legal fees related to the Company’s debt, are deferred and amortized over the life of the respective debt using\nthe effective interest method. The deferred financing costs related to the line of credit are included in Other non-current assets in\nour consolidated balance sheets. The amortization of deferred financing costs is included in interest expense on the accompanying consolidated\nstatements of operations and comprehensive loss.\n\n** **\n\n**Warrants**\n\n \n\nWe\nevaluate the appropriate balance sheet classification of warrants we issue as either equity or as a derivative liability. In accordance\nwith ASC 815, we classify a warrant as equity if it is “indexed to the Company’s equity” and meets several specific\nconditions for equity classification. A warrant is not considered “indexed to the Company’s equity,” in general, when\nit contains certain types of exercise contingencies or potential adjustments to its exercise price. If a warrant is not indexed to the\nCompany’s equity or it has net cash settlement provisions that result in the warrants being accounted for under ASC 480, *Distinguishing\nLiabilities from Equity*(“ASC 480”) or ASC 815, it is classified as a derivative liability which is carried on the consolidated\nbalance sheets at fair value with any changes in its fair value recognized in the statements of operations and comprehensive loss. At\nMarch 31, 2026 and 2025 all of the Company’s outstanding warrants were classified as equity.\n\n \n\nF-11\n\n \n\n \n\n**Leases**\n\n \n\nThe\nCompany determines if an arrangement is or contains a lease at contract inception, recording a lease liability and corresponding right-of-use\nasset at lease commencement for identified leases at the lease commencement date, which is generally when the Company takes possession\nof the asset. Lease agreements may contain adjustments to lease payments based on fixed escalation clauses, an index or a rate. Lease\nagreements may also require the Company to pay real estate taxes, insurance, common area maintenance, and other costs, collectively referred\nto as operating costs, in addition to lease payments. Lease agreements also may contain lease incentives, such as tenant improvement\nallowances and rent holidays. Lease agreements can include one or more options to renew or extend the initial lease term. The exercise\nof a lease renewal option is generally at the Company’s sole discretion. The Company’s lease agreements do not contain any\nmaterial residual value guarantees or material restrictive covenants\n\n \n\nThe\nlease liability is initially measured at the present value of the minimum fixed lease payments over the expected lease term, which includes\noptions to extend or terminate the lease agreement when it is reasonably certain those options will be exercised, using the Company’s\ndiscount rate as of lease commencement. Minimum fixed lease payments are discounted using the interest rate implicit in the lease or,\nif that rate cannot be readily determined, the Company’s incremental borrowing rate. Generally, the Company cannot determine the\ninterest rate implicit in the lease because it does not have access to the lessor’s estimated residual value or the amount of the\nlessor’s deferred initial direct costs. Therefore, the Company generally uses its incremental borrowing rate as the discount rate\nfor the lease. The Company’s incremental borrowing rate for a lease is the rate of interest it would have to pay on a collateralized\nbasis to borrow an amount equal to the lease payments under similar terms. Because the Company does not generally borrow on a collateralized\nbasis, it uses market-based rates as an input to derive an appropriate incremental borrowing rate, adjusted for the lease term and the\neffect on that rate of designating specific collateral with a value equal to the unpaid lease payments for that lease.\n\n \n\nThe\nCompany has elected the practical expedient to account for the lease and non-lease components as a single lease component. Therefore,\nminimum lease payments used to measure the lease liability include all of the fixed consideration in the contract.\n\n \n\nVariable\nlease payments associated with the Company’s leases are recognized upon the occurrence of the event, activity, or circumstance\nin the lease agreement on which those payments are assessed. Variable lease payments are presented in the accompanying consolidated statements\nof operations and comprehensive loss in the same line item as expense arising from fixed lease payments, which is generally within selling,\ngeneral and administrative expenses.\n\n \n\nLeases\nwith an initial term of 12 months or less are considered short-term leases and not recorded on the accompanying consolidated balance\nsheets. The Company recognizes lease expense for short-term leases on a straight-line basis over the lease term in the same line item\nas expense arising from fixed lease payments, which is generally within selling, general and administrative expenses.\n\n** **\n\n**Long-Lived\nAssets**\n\n \n\nLong-lived\nassets held for use are evaluated for impairment when the occurrence of events or a change in circumstances indicate that the carrying\nvalue of the assets may not be recoverable. In these cases, the Company estimates the future undiscounted cash flows to be derived from\nthe asset or asset group to determine whether the asset or asset group is recoverable. If the carrying value of an asset or asset group\nexceeds the estimated undiscounted future cash flows, an analysis is performed to estimate the fair value of the asset or asset group.\nAn impairment is recorded if the fair value of the asset or asset group is less than the carrying amount.\n\n \n\nImpairment\ncharges of long-lived assets, if any, are classified as selling, general and administrative expenses on the accompanying consolidated\nstatements of operations and comprehensive loss. The Company did not record impairment losses for the years ended March 31, 2026 and\n2025.\n\n \n\n**Income\nTaxes**\n\n \n\nThe\nCompany is required to estimate its income taxes in each of the jurisdictions in which it operates as part of preparing the consolidated\nfinancial statements. This involves estimating the actual current tax in addition to assessing temporary differences resulting from differing\ntreatments for tax and financial accounting purposes. These differences, together with net operating loss carryforwards and tax credits,\nare recorded as deferred tax assets or liabilities on the Company’s consolidated balance sheet. Deferred income tax assets and\nliabilities are measured using enacted tax rates, for the appropriate tax jurisdiction, which are expected to be in effect when these\ndifferences are anticipated to reverse.\n\n \n\nA\njudgment must then be made of the likelihood that any deferred tax assets will be recovered from future taxable income. A valuation allowance\nmay be required to reduce deferred tax assets to the amount that is more likely than not to be realized. In the event the Company determines\nthat it may not be able to realize all or part of its deferred tax asset in the future or that new estimates indicate that a previously\nrecorded valuation allowance is no longer required, an adjustment to the deferred tax asset is charged or credited to income in the period\nof such determination.\n\n \n\nF-12\n\n \n\n \n\nThe\nCompany recognizes tax positions that meet a “more likely than not” minimum recognition threshold. If necessary, the Company\nrecognizes interest and penalties associated with tax matters as part of the income tax provision and would include accrued interest\nand penalties with the related tax liability in the consolidated balance sheets.\n\n \n\n**Foreign\ncurrency**\n\n \n\nThe\nCompany’s reporting currency is the U.S. Dollar (“USD”). The functional currency for each entity included in these\nconsolidated financial statements is the applicable local currency of each entity. The Company’s entities domiciled in the United\nStates, United Kingdom, Hong Kong and Switzerland maintain their books and records in their local currencies, which are USD, Great Britain\nPound (“GBP”), Hong Kong Dollar (“HKD”), Swiss Franc (“CHF”) and Euro (“EUR”), respectively.\nFor each entity whose functional currency is not the USD, assets and liabilities are translated into USD using the exchange rate in effect\non the balance sheet date and revenue and expenses are translated into USD on a monthly basis using the average rate in effect for that\nmonth. Translation gains and losses are recorded as a foreign currency translation adjustment as a component of other comprehensive loss,\nwhich is a component of accumulated other comprehensive loss on the accompanying consolidated balance sheets.\n\n \n\nPursuant\nto US GAAP, assets and liabilities of the Company’s foreign operations with functional currencies other than the USD are translated\nat the exchange rate in effect at the balance sheet date, while revenues and expenses are translated at average rates prevailing during\nthe periods. Translation adjustments are reported in accumulated other comprehensive loss, a separate component of stockholders’\n(deficit) equity. Cash flows are also translated at average translation rates for the periods; therefore, amounts reported on the consolidated\nstatements of cash flows will not necessarily agree with changes in the corresponding balances on the consolidated balance sheets. Transaction\ngains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency\nare included in the results of operations as incurred.\n\n \n\nWe\nused the exchange rates in the following table to translate amounts denominated in non-USD currencies as of and for the periods noted:\n\n \n\nSCHEDULE OF FOREIGN CURRENCY\nEXCHANGE RATE\n\nYear end exchange rate: \nYear Ended\nMarch 31, 2026  \nYear Ended\nMarch 31, 2025 \n\n  \n   \n  \n\nGBP:USD \n 1.34450  \n 1.29539 \n\nHKD:USD \n 0.12848  \n 0.12856 \n\nCHF:USD \n 1.25986  \n 1.13505 \n\nEUR:USD \n 1.17344  \n NA \n\nPeriod end exchange rate \n 1.17344  \n NA \n\n \n\n  \n   \n  \n\nAverage exchange rate: \nYear Ended\nMarch 31, 2026  \nYear Ended\nMarch 31, 2025 \n\n  \n   \n  \n\nGBP:USD \n 1.33779  \n 1.27522 \n\nHKD:USD \n 0.12819  \n 0.12828 \n\nCHF:USD \n 1.23747  \n 1.12788 \n\nEUR:USD \n 1.15596  \n NA \n\nAverage exchange rate \n 1.15596  \n NA \n\n** **\n\n**Stock-based\ncompensation**\n\n \n\nShare-based\ncompensation cost is estimated at the grant date based on the award’s fair value. For stock options, time-based restricted stock\nunits, and market-based restricted stock units, share-based compensation cost is recognized over the expected requisite service period\nusing the straight-line attribution method. For equity-classified market-based restricted stock units, the probability of achieving the\nrelated market condition is incorporated into the grant date fair value. If targets are not met, no compensation cost will be reversed\nexcept in the case of award forfeitures. For performance-based restricted stock units, share-based compensation cost is recognized based\non the Company’s assessment of the probability of achieving the related performance targets. If such targets are not met, no compensation\ncost is recognized and any previously recognized compensation cost is reversed. The Company estimates forfeitures for share-based awards\ngranted, but which are not expected to vest.\n\n \n\nThe fair value of the Company’s stock options is estimated using the Black-Scholes-Merton Option Pricing model,\nwhich uses certain assumptions related to risk-free interest rates, expected volatility, expected life of the stock options or restricted\nstock, and future dividends. Compensation expense is recorded based upon the value derived from the Black-Scholes-Merton Option Pricing\nmodel and based on actual experience. The assumptions used in the Black-Scholes-Merton Option Pricing model could materially affect compensation\nexpense recorded in future periods.\n\n \n\nF-13\n\n \n\n \n\n**Comprehensive\nloss**\n\n** **\n\nComprehensive\nloss includes net loss as well as other changes in shareholders’ deficit that result from transactions and economic events\nother than those with shareholders. For the years ended March 31, 2026 and 2025, these changes related to foreign currency translation gains\nand losses. There were no reclassifications out of comprehensive loss for the years ended March 31, 2026 and 2025.\n\n** **\n\n**Net\nloss per share of common stock**\n\n \n\nBasic\nnet loss per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding for the period.\nDiluted net loss per share is computed by dividing the net loss applicable to common stockholders by the weighted average number of shares\nof common stock outstanding plus the number of additional shares of common stock that would have been outstanding if all dilutive potential\nshares of common stock had been issued using the treasury stock method. Potential shares of common stock are excluded from the computation\nwhen their effect is antidilutive. The dilutive effect of potentially dilutive securities is reflected in diluted net income per share\nif the exercise prices were lower than the average fair market value of common stock during the reporting period.\n\n \n\nPotentially\ndilutive stock options and securities as presented in the table below were excluded from the computation of diluted net loss per share,\nbecause the effect would be anti-dilutive. As the Company incurred losses in the years ended March 31, 2026 and 2025, basic and diluted\nweighted-average shares are the same in the loss per share calculation, in accordance with ASC 260-10-45-20.\n\n SCHEDULE OF ANTIDILUTIVE SECURITIES FOR BASIC AND DILUTED NET INCOME (LOSS) PER SHARE \n\n  \nMarch 31, 2026  \nMarch 31, 2025 \n\nOptions to acquire common stock \n 643,300  \n 1,006,550 \n\nRestricted stock units granted to employees to acquire stock \n 1,554,348  \n 600,000 \n\nWarrants to acquire common stock \n 6,744,553  \n 123,376 \n\nSeries AA convertible preferred stock \n -  \n 4,624,620 \n\nAntidilutive securities \n 8,942,201  \n 6,354,546 \n\n \n\n**Fair\nValue of Financial Instruments**\n\n \n\nASC\n820, *Fair Value Measurements and Disclosures* (“ASC 820”), clarifies that fair value is an exit price, representing\nthe amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants.\nAs such, fair value is a market-based measurement that should be determined based upon assumptions that market participants would use\nin pricing an asset or liability. As a basis for considering such assumptions, ASC 820 establishes a three-tier fair value hierarchy,\nwhich prioritizes the inputs used in measuring fair value as follows:\n\n \n\n \nLevel\n1:\nInputs\nbased on unadjusted quoted market prices available in active markets for identical assets or liabilities as of the reporting date.\n\n \nLevel\n2:\nPricing\ninputs other than quoted prices in Level 1, such as quoted prices for similar assets or liabilities in active markets or quoted prices\nfor identical or similar instruments in markets that are not active or for which all significant inputs are observable or can be\ncorroborated by observable market data.\n\n \nLevel\n3:\nInputs\nreflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement\ndate. The inputs are both unobservable for the asset and liability in the market and significant to the overall fair value measurement.\n\n \n\nAn\nasset’s or liability’s fair value measurement level within the fair value hierarchy is based on the lowest level of any input\nthat is significant to the fair value measurement. Valuation techniques used need to maximize the use of observable inputs and minimize\nthe use of unobservable inputs.\n\n \n\nF-14\n\n \n\n \n\nAssets\nand liabilities measured at fair value are based on one or more of the following techniques noted in ASC 820:\n\n \n\n \n●\n*Market\napproach:* Prices and other relevant information generated by market transactions involving identical or comparable assets or\nliabilities.\n\n \n●\n*Cost\napproach:*Amount that would be required to replace the service capacity of an asset (replacement cost).\n\n \n●\n*Income\napproach:* Techniques to convert future amounts to a single present value amount based upon market expectations (including present\nvalue techniques, option pricing, and excess earnings models).\n\n \n\nThe\nCompany believes its valuation methods are appropriate and consistent with other market participants, however the use of different methodologies\nor assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the\nreporting date.\n\n \n\nThe\ncarrying amount of the Company’s financial assets and liabilities, such as cash and cash equivalents, prepaid expenses, accounts\npayable, accrued expenses and operating lease liabilities approximate their fair value due to their short-term nature or expected settlement\ndate of these instruments. The carrying values of debt obligations approximate their fair values due to the fact that the interest rates\non these obligations are based on prevailing market interest rates. The Company does not have financial instruments measured at fair\nvalue on a recurring basis as of March 31, 2026 and 2025.\n\n \n\nIt\nis management’s opinion that the Company is not exposed to significant interest or credit risks arising from these financial instruments.\n\n \n\n**Segment\nReporting**\n\n \n\nASC\n280, *Segment Reporting* (“ASC 280”), defines operating segments as components of an enterprise where discrete financial\ninformation is available that is evaluated regularly by the chief operating decision-maker (“CODM”) in deciding how to allocate\nresources and in assessing performance. The Company’s chief financial officer and chief creative officer collectively perform the\nfunction that allocates resources and assesses performance, and thus together, serve as the Company’s CODM. The CODM reviews the\nassets, operating results, and financial metrics for the Company as a whole to make decisions about allocating resources and assessing\nfinancial performance. Accordingly, management has determined that there is only one reportable segment. The CODM assesses performance\nfor the single reportable segment and decides how to allocate resources based on net loss. The measure of segment assets is reported\non the balance sheet as total assets.\n\n \n\n**Recent\nAccounting Pronouncements, adopted**\n\n \n\nASU\n2024-01, *Compensation-Stock Compensation (Topic 718): Scope Application of Profits Interest and Similar Awards* (“ASU 2024-01”)\nintroduces updates to accounting standards related to the classification and measurement of financial instruments under ASC 320. The\nupdate primarily focuses on clarifying guidance for equity securities, debt instruments, and other financial assets, particularly in\nthe areas of fair value measurement and impairment recognition. It aims to improve consistency and comparability in the reporting of\nfinancial instruments by refining the criteria for classifying securities and enhancing the methodology for recognizing and measuring\nimpairments. ASU 2024- 01 also mandates additional disclosures to provide greater transparency around the valuation techniques and assumptions\nused in determining the fair value of financial instruments. The update is effective for fiscal years beginning after December 15, 2024,\nwith early adoption permitted. The Company adopted ASU 2024-01 effective March 31, 2026, for the fiscal year beginning April 1, 2025.\nThe adoption of this guidance did not have material impact on Company’s consolidated financial statements or related disclosures.\n\n \n\nASU\n2024-02, *Codification Improvements-Amendments to Remove References to the Concepts Statements* (“ASU 2024-02”) updates\naccounting standards for revenue recognition, lease accounting, and impairment of long-lived assets. ASU 2024-02 provides enhanced guidance\nfor estimating variable consideration, accounting for contract modifications, determining lease terms, and simplifying impairment testing\nfor long-lived assets. It also introduces increased disclosure requirements for financial instruments and derivatives. ASU 2024-02 is\neffective for fiscal years beginning after December 15, 2024, with early adoption permitted. The Company adopted ASU 2024-02 effective\nMarch 31, 2026, for the fiscal year beginning April 1, 2025. The adoption of this guidance did not have material impact on Company’s\nconsolidated financial statements or related disclosures.\n\n \n\nASU\n2023-09, *Income Taxes (Topic 740): Improvements to Income Tax Disclosures* (“ASU 2023-09”), include amendments that\nfurther enhance income tax disclosures, primarily through disaggregation of specific rate reconciliation categories and income taxes\npaid by jurisdiction. The amendments are effective for annual periods beginning after December 15, 2024, with early adoption permitted,\nand may be applied prospectively or retrospectively. The Company adopted ASU 2023-09 effective March 31, 2026, for the fiscal year beginning\nApril 1, 2025. The adoption did not have a material impact on the Company’s consolidated financial  statements.\n\n \n\nF-15\n\n \n\n \n\n**Recent\nAccounting Pronouncements, not yet adopted**\n\n \n\nASU\n2024-03, *Disaggregation of Income Statement Expenses (“DISE”)* (“ASU 2024-03”) requires disclosures about\nspecific types of expenses included in the expense captions presented on the face of the income statement as well as disclosure about\nselling expenses. ASU 2024-03 is effective for fiscal years beginning after December 15, 2027, with early adoption permitted. The Company\nis currently evaluating the impact of this ASU on its financial statements and disclosures.\n\n \n\nASU\n2023-06, *Disclosure Improvements: Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative*(“ASU 2023-06”) incorporates several disclosure and presentation requirements currently residing in SEC Regulation S-X\nand S-K into the ASC. The amendments are applied prospectively and are effective when the SEC removes the related requirements from Regulation\nS-X and S-K. Any amendments the SEC does not remove by June 30, 2027 will not be effective. Early adoption is prohibited. The Company\nis currently evaluating the impact of this ASU on its financial statements and disclosures.\n\n \n\nASU\n2025-01, *Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures: Clarifying the Effective Date* (“ASU\n2025-01”) clarifies the effective date of ASU 2024-03 is for fiscal years beginning after December 15, 2026, and interim periods\nwithin annual reporting periods beginning after December 15, 2027. The Company is currently evaluating the impact of ASU 2024-03 on its\nfinancial statements and disclosures.\n\n \n\nASUs\nrecently issued but not listed above were assessed and determined to be either not applicable or are expected to have minimal impact\non the consolidated financial position or results of operations.\n\n \n\n**3.\nINVENTORIES, NET**\n\n \n\nThe\nfollowing table details the primary categories of inventories for the periods presented.\n\n SCHEDULE OF INVENTORY\n\n  \nMarch 31, 2026  \nMarch 31, 2025 \n\n  \n   \n  \n\nFinished goods1 \n$4,313  \n$3,326 \n\nRaw materials \n 819  \n 807 \n\nFinished goods on consignment1 \n 580  \n 391 \n\nGoods in transit \n - \n 32 \n\nTotal inventories \n 5,712  \n 4,556 \n\nInventory reserve \n (1,815) \n (2,989)\n\nTotal inventories, net \n$3,897  \n$1,567 \n\n \n\n1Certain prior period\npresentation of these categories were reclassified to ensure comparability with current period presentation.\n\n \n\n**4.\nPREPAID AND OTHER CURRENT ASSETS**\n\n \n\nThe\nfollowing table details the primary categories of prepaid and other current assets for the periods presented.\n\n SCHEDULE OF PREPAID AND OTHER CURRENT ASSETS\n\n  \nMarch 31, 2026  \nMarch 31, 2025 \n\n  \n   \n  \n\nOther receivables 1 \n$1,347  \n$466 \n\nDeposits and prepayments \n 1,503  \n 1,621 \n\nOther \n 18  \n 147 \n\nMarketing services \n 82  \n 578 \n\nTotal prepaid and other current assets \n$2,950  \n$2,812 \n\n** **\n\n1Includes $413 related to tariff recovery receivables as of March 31, 2026, compared to $0 for the year ended March 31, 2025.\n\n** **\n\n**5.\nPROPERTY AND EQUIPMENT**\n\n \n\nProperty\nand equipment consisted of the following for the periods presented:\n\n SCHEDULE\nOF PROPERTY AND EQUIPMENT\n\n  \nMarch 31, 2026  \nMarch 31, 2025 \n\n  \n   \n  \n\nSoftware and website development \n$\n2,471\n  \n$\n2,220\n \n\nFurniture and fixtures \n174  \n178 \n\nConstruction in progress \n 145  \n - \n\nOffice equipment \n 38  \n 58 \n\nLeasehold improvements \n 28  \n 29 \n\nComputer equipment \n 115  \n 140 \n\nProperty and equipment, gross \n 2,971  \n 2,625 \n\nAccumulated depreciation \n (2,472) \n (2,142)\n\nProperty and equipment, net \n$499  \n$483 \n\n \n\nF-16\n\n \n\n \n\nDepreciation\nexpense related to property and equipment was $323 and $342 for the years ended March 31, 2026 and 2025, respectively, and is included\nas a component of selling, general and administrative expenses on the accompanying consolidated statements of operations and comprehensive\nloss.\n\n \n\nDuring\nthe year ended March 31, 2026, the Company disposed property and equipment, recording a loss on disposal of approximately $6\nas a component of other income (expense) on the accompanying consolidated statements of operations and comprehensive loss.\n\n \n\n**6.\nLEASES**\n\n \n\nThe\nCompany has obligations under operating leases for its offices. The majority of the Company’s leases include renewal options at the sole discretion of the Company.\nIn general, it is not reasonably certain that lease renewals will be exercised at lease commencement and therefore lease renewals are\nnot included in the lease term.\n\n \n\nIn January 2026, the Company entered into a long-term\nnon-cancellable lease agreement for its new office facility. The lease terminates in 2030. The Company classified the lease as an operating\nlease and determined that the present value of the right of use asset and lease liability at the adoption date was $1,077, using a discount\nrate of 8.00%.\n\n \n\nThe\nfollowing table details the Company’s net lease expense. The lease expenses include contingent rent payments and other non-fixed\nlease related costs, including common area maintenance, property taxes, and landlord’s insurance.\n\nSCHEDULE OF LEASE EXPENSE  \n\nLease expense \nMarch 31, 2026  \nMarch 31, 2025 \n\nLease expense \n\n**Year Ended**\n\n**March 31, 2026**\n  \n\n**Year Ended**\n\n**March 31, 2025**\n \n\n  \n   \n  \n\nNet lease expense: \n    \n   \n\nOperating lease expense \n$76  \n$110 \n\nTotal lease expense \n$76  \n$110 \n\n  \n    \n   \n\nWeighted-average remaining lease term (in years) \n 4.72  \n 0.53 \n\nWeighted-average discount rate \n 8.0% \n 5.0%\n\n \n\nRent\nexpense for the fiscal years ended March 31, 2026 and 2025 was $534 and $894, respectively (including short term and other\nrentals).\n\n \n\nSCHEDULE OF FUTURE MATURITY OF LEASE LIABILITIES\n\nMaturity of lease liabilities \nMarch 31, 2026 \n\n  \n  \n\nWithin one year \n$59 \n\nWithin one to two years \n 232 \n\nWithin two to three years \n 339 \n\nWithin three to four years \n 382 \n\nWithin four to five years \n 316 \n\nTotal lease payments \n 1,328 \n\nDiscount rate \n (259)\n\nPresent value of lease liabilities \n1,069 \n\nLess current portion \n (37)\n\nOperating lease liability, non-current\n\n \n$\n1,032\n \n\n \n\nF-17\n\n \n\n \n\n**7.\nACCRUED EXPENSES**\n\n \n\nThe\nfollowing table details the primary categories of accrued expenses for the periods presented.\n\n SCHEDULE OF ACCRUED EXPENSES\n\n  \nMarch 31, 2026  \nMarch 31, 2025 \n\n  \n   \n  \n\nAccrued expenses1 \n$1,457  \n$1,289 \n\nAccrued payroll and payroll taxes1 \n 576  \n 1,621 \n\nIndirect taxes1 \n 257  \n 437 \n\nReturns provision \n 322  \n 594 \n\nAccrued import duties \n 247  \n 228 \n\nMerchant credit \n -  \n 64 \n\nTotal \n$2,859  \n$4,233 \n\n \n\n1Certain prior period\npresentation of these categories were reclassified to ensure comparability with current period presentation.\n\n \n\n**8.\nDEBT**\n\n \n\n**Short-Term\nBorrowings**\n\n** **\n\nDuring\nthe years ended March 31, 2026 and 2025, the Company entered into business loan and security agreements (the “Term Loans”)\nwith a lender for short-term loans to be provided by the lender, or the lender’s assignees (collectively, the “Lenders”)\nthat mature 30-weeks from the date of a borrowing. No amount of repaid borrowings may be reborrowed. During the year ended March 31,\n2026 and 2025, the Company borrowed a gross amount of $1,988 and $8,658, respectively, net of fees of $658 and $2,866, respectively,\nwhich were recorded as a debt discount and are being amortized over the term of the Term Loans.\n\n \n\nDuring\nthe years ended March 31, 2026 and 2025, the Company made total repayments of $4,725 and $5,742, respectively. During the years ended\nMarch 31, 2026 and 2025, the company amortized $1,544 and $1,801, respectively, of the debt discount to interest expense. As of March\n31, 2026 and 2025, the Company had outstanding borrowings of $nil and $2,738, respectively, and an unamortized debt discount of $nil\nand $887, respectively, resulting in a net balance of $nil and $1,851, respectively.\n\n \n\n****\n\n**Trade\nFinance Facility**\n\n** **\n\nThe\nCompany, through PMA, had a trade finance facility extended on goods for which letters of credit are issued to the Company’s\nsuppliers by a financial institution. The trade facility agreement was entered into in June 2022 and subsequently amended since with\nthe most recent amendment in August 2024. The outstanding balance under the trade finance facility of $2,495\nas of March 31, 2025 was repaid in full during June 2025. The trade finance facility was subsequently\nterminated in August 2025. The Company was permitted to draw on the trade finance facility agreement to the extent that there is\na deposit made to a specified account with the financial institution.\n\n \n\nThe\ntrade finance facility, as amended in August 2024, provides for (a) import facilities up to $2,700 as of March 31, 2025, with repayment\ndue 120-days from the draw, and (b) post-shipment buyer loans up to $1,800 as of March 31, 2025 with repayment due 90-days from the draw.\nA commission fee equal to 0.25% and 0.0625% was charged on the first $50 and balances in excess of $50 respectively, drawn under the\ntrade finance facility.\n\n \n\nFor\ndrawings in Hong Kong dollars, the interest rate equaled the Hong Kong Interbank Offered Rate (“HIBOR”) plus 3.0%, and for\ndrawings in U.S. dollars, the interest rate equaled the Secured Overnight Financing Rate (“SOFR”) plus 3.3%.\n\n \n\nAs\nof March 31, 2025, the cash deposit associated with the trade finance facility agreement was $1,350 and is recorded as restricted cash\non the accompanying consolidated balance sheets.\n\n \n\n**2024\nDebt Financing**\n\n \n\nIn\nDecember 2024, the Company entered into a convertible secured promissory note (“2024 Debt Financing”) whereby the Company\ncompleted convertible debt financing (“2024 Debt Financing”), from one investor, for gross proceeds of $2,000, to provide\nworking capital for its operations. The Company’s convertible debt obligations were secured by a security interest over the assets\nof the Company.\n\n \n\nIn\nMarch 2025, $2,000 in principal converted into an aggregate 2,000,000 shares of the Company’s common stock, at a conversion price\nof $1.00 (see Note 10 ). At the time of conversion, accrued but unpaid interest of $93 was included in the balance of accrued expenses\nin the accompanying consolidated balance sheets as of March 31, 2025, which was paid in cash to the lender during the year ended March\n31, 2026.\n\n \n\nF-18\n\n \n\n \n\n**9.\nNOTES AND LINE OF CREDIT – RELATED PARTY**\n\n \n\n**Related\nParty Notes**\n\n \n\nDuring\nMay 2025, the Company entered into a promissory note (the “May 2025 Related Party Note”) with an entity controlled by\nthe Chairman of the Company’s board of directors to borrow $500.\nThe May 2025 Related Party Note matured on December\n31, 2025 and permitted the Company to prepay the note in full without penalty at any time. If an Event of Default, as defined\nin the May 2025 Related Party Note, occurs, the outstanding principal and accrued interest would become due and payable\nimmediately. Concurrently, with the closing of an offering in September 2025 (see Note 8), the May 2025 Related Party Note and\naccrued unpaid interest totaling $508\nwas extinguished through the issuance of 1,692,694\nshares of the Company’s common stock at a per share price of $0.30.\nThe issuance of shares was approved and determined to be on terms and conditions at arm’s length as the share price was the\nsame price extended to third parties as part of a share offering that closed on the same day (see Note 10).\n\n \n\nDuring\nAugust 2025, the Company received $3,390 from one of its principal shareholders (a related party) in exchange for an unsecured promissory\nnote that matures on March 9, 2026 (the “First August 2025 Related Party Note”), and $1,700 from two of its principal shareholders\n(related parties) in exchange for an unsecured promissory note that matures on August 18, 2030 (the “Second August 2025 Related\nParty Note”, collectively with the First August 2025 Related Party Note, the “August 2025 Related Party Notes”). In\nMarch 2026, the First August 2025 Related Party Note was amended to extend the maturity date to March 31, 2026.\n\n \n\nIn\nconsideration for providing the August 2025 Related Party Notes, the Company issued the principal shareholder 652,253 restricted stock\nunits of the Company’s common stock, with 521,802 restricted stock units vesting immediately and 130,451 restricted stock units\nvesting over the term of the August 2025 Related Party Notes. The fair value of the restricted stock units was $305, as determined by\nthe average closing price of the Company’s common stock for the five trading days immediately preceding the issuance of the August\n2025 Related Party Notes, and was recorded as a debt discount and is being amortized over the terms of the August 2025 Related Party\nNotes.\n\n \n\nThe August 2025 Related Party\nNotes permitted the Company to prepay the note in full without penalty at any time. If an Event of Default, as defined in the August 2025\nRelated Party Notes, occurred, the outstanding principal and accrued interest would become due and payable immediately. If the Company\nprepaid the notes, the unvested restricted stock units would vest proportionately with the amount of the prepayment.\n\n \n\nDuring\nthe years ended March 31, 2026 and 2025, the Company amortized $204 and $0, respectively, of the debt discount to interest expense. During\nMarch 2026, the outstanding borrowings of $5,090 and $51 of accrued interest under the August 2025 Related Party Notes were repaid in\nfull. During the year ended March 31, 2026, the Company incurred and paid interest on the August 2025 Related Party Notes totaling $382.\nAs of March 31, 2026, there were no amounts of accrued but unpaid interest on the August 2025 Related Party Notes.\n\n \n\n**Line\nof Credit**\n\n** **\n\nOn\nMarch 30, 2026, the Company entered into a loan agreement for up to $10,000 maturing on March 30, 2028 (the “Revolver”) with\nan investor, considered a related party at the time the Revolver was entered into, and an additional lender, that become a related party\nin May 2026 (see Note 15), (together, the “Lenders”).\n\n \n\nThe\nLenders will be entitled to assign all or a portion of its exposure under the Revolver or to sell participations therein. The proceeds\nof the Revolver were restricted to the repayment of the August 2025 Related Party Notes and to fund the working capital needs of the\nCompany’s operations.\n\n \n\nThe\nRevolver bears interest of 12.0% per annum and is calculated on the daily outstanding balance. The Revolver also incurs a fee of 1.5%\nper annum on the daily unused portion, payable monthly in arrears. The Revolver is secured by a first priority, perfected lien on and\nsecurity interest in the existing and future assets of the Company.\n\n \n\nAs\nof March 31, 2026, $5,140 was outstanding under the Revolver and nominal amounts of interest and fees were accrued but unpaid. During\nthe year ended March 31, 2026, the Company incurred a nominal amount of interest on the Revolver.\n\n \n\nThe\nRevolver includes negative covenants restricting investments, additional debt and liens, restricted payments and sales of assets, and\ntypical affirmative covenants including compliance with laws, financial and informational reporting requirements.\n\n \n\nSimultaneously\nwith entering the Revolver, the Company entered into a securities purchase agreement with non-related party lender of the Revolver which\nwas consummated in May 2026. At the time those shares are purchased and issued, the Company will also issue to the lender warrants to purchase\n1,864,753 shares of the Company’s common stock, par value $0.0001 per share (the “Common Stock”), at an exercise price\nof $0.46822 per share. See further discussion in Note 17, Subsequent Events.\n\n \n\n**10.\nSTOCKHOLDERS’ (DEFICIT) EQUITY**\n\n \n\nThe\nCompany is authorized to issue 110,000,000 shares of stock, of which 100,000,000 is designated as common stock and 10,000,000 is designated\nas preferred stock.\n\n \n\nF-19\n\n \n\n \n\n**Common\nstock**\n\n \n\nThe\nCompany is authorized to issue 100,000,000 shares of common stock with a par value of $0.0001 per share, of which 47,048,174 and 19,291,000\nwere issued and outstanding as of March 31, 2026 and 2025, respectively.\n\n \n\n**Sale\nof Common Stock**\n\n \n\n*Public\nOffering:* On June 30, 2025, the Company closed a public offering of 10,000,000 shares of its common stock at an offering price\nof $0.30 per share (the “Offering”), pursuant to its registration statement on Form S-3 (File No. 333-285612) for aggregate\nnet proceeds of approximately $2,538, after deducting underwriting discounts and commissions and estimated offering expenses. The underwriters\nwere also granted a 45-day option to purchase up to an additional 1,500,000 shares of common stock and/or pre-funded warrants to cover\nover-allotments, if any. On July 21, 2025, the over-allotment option was partially exercised by the underwriters for an additional 313,128\nshares of the Company’s common stock, generating net proceeds of approximately $83, after deducting underwriting discounts and\ncommissions and estimated offering expenses.\n\n \n\nIn\nconnection with the Offering, the Company issued to the representative of the underwriters, warrants to purchase up to 500,000 shares\nof common stock at an exercise price of $0.375 per\nshare (the “June 2025 Warrant”). The June 2025 Warrant is exercisable beginning on the date of issuance and expires five\nyears thereafter. The June 2025 Warrant was\ndetermined to be an equity classified warrant.\n\n \n\nIn\nconnection with the underwriter’s exercise of the over-allotment option, the Company issued the representative of the underwriters\nfrom the Offering a warrant to purchase up to 15,656\nshares of the Company common stock at an exercise price of\n$0.375\n(the “July 2025 Warrant”). The July 2025 Warrant\nis exercisable beginning on the date of issuance and expires five\nyears thereafter. The July 2025 Warrant was determined\nto be an equity classified warrant.\n\n \n\nThe\nholder of the June 2025 Warrants and July 2025 Warrants shall not have the right to convert any portion of the respective warrants to\nthe extent that after giving effect to such conversion the holder of the respective warrants, together with any affiliates, would beneficially\nown in excess of 4.99% (which may be increased to 9.99% at the holder’s sole discretion) of the number of common shares outstanding\nimmediately after giving effect to such conversion. Any increase to the beneficial ownership limitation will not be effective until the\n61st day after notice is received by the Company.\n\n \n\n*Securities\nPurchase Agreement:* On August 27, 2025, the Company entered into a securities purchase agreement (the “August SPA”)\nto issue and sell 3,172,858\nshares of its common stock (the “August SPA Shares”)\nat a per share price of $0.46822,\nwhich represents the average closing price of the Company’s common stock for the five trading days immediately preceding the sale,\nand a warrant to purchase up to 3,204,908\nshares of its common stock (the “August 2025 Warrant\nShares”, and together with the August SPA Shares, the “August SPA Securities”) at an exercise price of $0.46822\nper share (the “August 2025 Warrant”) for aggregate\nnet proceeds of approximately $1,429,\nafter deducting direct offering expenses. The August 2025 Warrant is exercisable beginning on the date of issuance and expires three\nyears thereafter. The August 2025 Warrant can be exercised on a cashless basis if the shares underlying the August 2025 Warrant are not\nregistered at the time it is exercised. The August 2025 Warrant was determined to be an equity classified warrant.\n\n \n\nThe\nholder of the August 2025 Warrants shall not have the right to convert any portion of the respective warrants to the extent that after\ngiving effect to such conversion the holder of the respective warrants, together with any affiliates, would beneficially own in excess\nof 9.99% (which may be increased to 19.99% at the holder’s sole discretion) of the number of common shares outstanding immediately\nafter giving effect to such conversion. Any increase to the beneficial ownership limitation will not be effective until the 61st day\nafter notice is received by the Company.\n\n \n\nIn January 2026, the holder of\nthe August 2025 warrants gave notice to the Company of its intent to increase its beneficial ownership percentage to 19.99%, which was\napproved during the Company’s annual meeting of stockholders on January 14, 2026.\n\n \n\nBeginning\nin August 2026, the Company may, at its sole discretion, require the holder of the August 2025 Warrant to exercise the warrant in full\non a specified date (the “Mandatory Exercise Date”), provided that, prior to and as of the Mandatory Exercise Date (a) the\nclosing price of the Company’s common stock has exceeded the exercise price of the August 2025 Warrant during any consecutive five\ntrading days within a fifteen trading-day period at least once and (b) the Company has an effective registration statement registering\nthe resale of both the August 2025 Warrant and the shares issuable upon exercise of the August 2025 Warrant. On the Mandatory Exercise\nDate, the beneficial ownership limitation will be automatically increased to 19.99%. If the holder of the August 2025 Warrant does not\npay the amount due in cash within thirty days of the Mandatory Exercise Date, then the Company may effect, in its discretion, either\n(i) a cashless exercise of the August 2025 Warrants or (ii) a redemption and subsequent cancellation of the August 2025 Warrant, in exchange\nfor $0.001 per warrant.\n\n \n\nIn January 2026, the August 2025\nWarrant was amended (the “Amended August 2025 Warrant”) to include a down round feature that should the Company issue its\ncommon stock and common stock equivalents, subject to certain exempt issuances, for per share consideration that is less than the current\nexercise price per share of the Amended August 2025 Warrant, then the exercise price shall be lowered to equal to the quotient obtained\nby dividing: (A) the sum of (1) the product obtained by multiplying the common stock deemed outstanding immediately prior to such issuance\nor sale (or deemed issuance or sale) by the exercise price then in effect plus (2) the aggregate consideration, if any, received by the\nCompany upon such issuance or sale (or deemed issuance or sale); by (B) the sum of (1) the common stock deemed outstanding immediately\nprior to such issuance or sale (or deemed issuance or sale) plus (2) the aggregate number of shares of common stock issued or sold (or\ndeemed issued or sold) by the Company in such issuance or sale (or deemed issuance or sale).\n\n \n\nThe holder of the Amended August\n2025 Warrant was granted a right of first refusal on a debt or equity financing transaction, as defined in the agreement, that provided\nthe holder with the right to participate pro rata, except in connection with excluded issuances, in the planned financing transaction\nas long as the holder of the Amended August 2025 Warrants, together with any affiliates, would beneficially own in excess of 4.99% of\nthe number of common shares outstanding immediately preceding the financing transaction.\n\n \n\nThe Amended August 2025 Warrant\nwas determined to be an equity classified warrant as it remains indexed to the Company’s own stock and meet the scope exception\nof ASC 815.\n\n \n\nIn January 2026, the Company entered into a warrant agreement for a warrant\nto purchase up to 2,900,613 shares of its common stock, at an exercise price of $0.46822 per share (the “January 2026 Warrant”)\nin connection with the Amended August 2025 Warrant and the conversion of Series AA Preferred Stock into common stock. The January 2026\nWarrant is exercisable beginning on the date of issuance and expires August 27, 2028. The January 2026 Warrant can be exercised on a cashless\nbasis if the shares underlying the January 2026 Warrant are not registered at the time it is exercised. The January 2026 Warrant contains\nthe same terms and conditions as the Amended August 2025 Warrant. The January 2026 Warrant was determined to be an equity classified warrant.\n\n \n\nF-20\n\n \n\n \n\n*Equity\nLine of Credit (“ELOC”):* On October 7, 2025, the Company entered into an equity purchase agreement (the “ELOC”),\nwhereby the Company has the right, but not the obligation, to direct an investor to purchase up to $25,000 of the Company’s common\nstock (the “Put Shares”), where the Company directs the investor to purchase Put Shares in increments between $5 and the\nlesser of (a) $500 or (b) 20.0% of the Average Daily Trading Value (as defined in the ELOC), on the terms and conditions set forth in\nthe ELOC. The purchase price of the Put Shares will be the lesser of (i) 97.0% of the Market Price (as defined in the ELOC) or (ii) 102.0%\nof the Market Alternative Price (as defined in the ELOC). If the Company’s principal market is any tier of the OTC Markets on the\ndate the investor receives the Company’s directive, the purchase price of the Put Shares will be the lesser of (i) 85.0% of the\nMarket Price or (ii) 85.0% of the Market Alternative Price. The number of Put Shares to be purchased by the investor is subject to a\nbeneficial ownership limitation of 4.99%.\n\n \n\nThe\nELOC will not be effective until it is first approved by the Company’s shareholders and then approved by the Company’s board\nof directors. The ELOC was approved by the Company’s shareholders on January 14, 2026, but has not been approved by the Company’s\nBoard as of the dates these condensed consolidated financial statements were issued. Once the ELOC is effective, the Company will issue\nthe investor shares of the Company’s common stock (the “Commitment Shares”) that is determined by dividing 187,000\nby the lesser of (i) the closing price of the Company’s common stock on the Trading Day (as defined in the ELOC) immediately preceding\ndate the ELOC is approved by Company’s board of directors, or (ii) average of the five (5) closing prices of the Company’s\ncommon stock during the five Trading Days immediately preceding the date the ELOC is approved by Company’s board of directors.\nAs of the date these condensed consolidated financial statements were issued, the approvals were not yet received.\n\n \n\nIn\nconnection with the ELOC, the Company entered into a registration rights agreement (the “ELOC RRA”) whereby the Company will\nfile a registration statement covering the maximum number of registerable securities (as defined in the ELOC RRA) within forty-five calendar\ndays from the date the ELOC is approved by the Company’s board of directors.\n\n \n\nThe\nELOC will end on the earlier of (i) the date the investor purchased $25,000 of Put Shares, (ii) October 7, 2027, (iii) the date of written\nnotice of termination by the Company to the investor (per the terms and conditions set forth in the ELOC), (iv) the ELOC RRA is no longer\neffective after the initial effective date of the ELOC RRA, or (v) the date that the Company commences a case or any person commences\na proceeding against the Company, a custodian is appointed for the company or for all or substantially all of its property or the Company\nmakes a general assignment for the benefit of its creditors. As of March 31, 2026, no shares of the Company’s common stock have\nbeen issued under the ELOC.\n\n \n\n**Series\nAA Preferred Stock**\n\n \n\nIn\nMarch 2025, the Company designated a series of preferred stock as the 12.00% Series AA Convertible Preferred Stock, par value of $0.0001\nper share (the “Series AA Preferred Stock”) and authorized 1,800,000 shares of Series AA Preferred Stock.\n\n \n\nIn\nMarch 2025, the Company entered into securities purchase agreements with twelve investors whereby the Company issued 924,921 shares of\nSeries AA Preferred Stock at an original issue price of $5.8005 per share for gross proceeds of $5,365, less $217 of issuance costs or\ntotal net proceeds of $5,148. In connection with the securities purchase agreements, the Company entered into a registration rights agreement\nwith the investors whereby the Company committed to file the registration statement to register for resale the shares of common stock\nissuable upon conversion of the Series AA Preferred Stock purchased by the investors pursuant to the securities purchase agreements no\nlater than thirty days from the final closing date. Registration statement was filed on March 6, 2025.\n\n \n\nAdditionally,\nthe Company entered into a placement agency agreement with a placement agent in exchange for a cash fee of 6.0% of the gross proceeds\npaid by investors introduced to the Company by the placement agent. Additionally, the Placement Agent received 56,676 warrants to purchase\nshares of common stock equal to 5.0% of the shares of common stock issuable upon conversion of the Series AA Preferred Stock purchased\nby these investors (the “March 2025 Warrant”) at a per share price of $1.45 for a term of five years that may be exercised\non a cash or cashless basis (see Note 12).\n\n \n\nThe\nSeries AA Preferred Stock holder and the March 2025 Warrant holder (collectively, the “March 2025 Investors”) shall not have\nthe right to convert any portion of the Series AA Preferred Stock or March 2025 Warrant to the extent that after giving effect to such\nconversion the March 2025 Investors, together with any affiliates, would beneficially own in excess of 4.99% (which may be increased\nto 9.99% at the March 2025 Investor’s sole discretion) of the number of common shares outstanding immediately after giving effect\nto such conversion. Any increase to the beneficial ownership limitation will not be effective until the 61st day after notice is received\nby the Company. The March 2025 Warrant was determined to be an equity classified warrant.\n\n \n\nF-21\n\n \n\n \n\nOn\nJanuary 15, 2026, the Company issued 11,458,306 shares of its common stock upon conversion of all outstanding shares of Series AA Preferred\nStock at a reduced conversion price of $0.46822 per share, as approved by the shareholders of the Company on January 14, 2026.\n\n \n\n**Shares\nIssued for Services**\n\n* *\n\nThe\nCompany, from time to time, issues shares of its common stock for marketing and other services. The fair value of the shares is\ninitially capitalized as a prepaid service cost and amortized over the service period. During the years ended March 31, 2026 and\n2025, the Company issued 100,000\nand 1,352,102 shares of restricted common stock to vendors for services rendered and to be rendered with a fair value of $62 and $1,488, respectively.\nThese shares of common stock were valued based on the market value of the Company’s common stock price at the issuance date or\nthe date the Company entered into the agreement related to the issuance. During the years ended March 31, 2026 and 2025, the Company\namortized $558\nand $910\nrespectively, of the value of the shares as the services were rendered. As of March 31, 2026, the unamortized service cost was\n$82\nand was included as a components of prepaid and other current assets. (see Note 4).\n\n \n\n**11.\nSTOCK-BASED COMPENSATION PLANS**\n\n \n\nThe\nCompany maintains the 2021 Equity Incentive Plan (the “2021 Plan”), which provides for the grant of incentive stock options,\nnon-statutory stock options, stock appreciation rights, restricted stock awards, restricted stock units and performance units and performance\nshares to employees, directors and consultants of the Company or any parent or subsidiary of the Company. The purpose of the 2021 Plan\nis to enable the Company to attract and retain the best available personnel for positions of substantial responsibility, to provide additional\nincentive to employees, directors and consultants of the Company or any parent or subsidiary of the Company, and to promote the success\nof the Company’s business. The Company has 1,400,801\nunallocated shares available to grant from the 2021 Plan as\nof March 31, 2026. The Company has historically granted stock options to non-employees in exchange for the provision of services, both\nunder the 2021 Plan and outside of the 2021 Plan.\n\n \n\nThe\nCompany has granted stock options and time-based restricted stock units (“time-based RSUs”). Stock options granted to date\ngenerally have a 4-year vesting period and vest at a rate of 25% each year on the anniversary date of the grant. Stock options generally\nexpire on the earlier of 10 years from the date of grant, or a specified period of time following termination. Time-based RSUs generally\nvest over a period of four years  in accordance with the terms and conditions established by the board of directors, and are based\non continued service.\n\n \n\n**Time-based\nRSUs**\n\n \n\nThe\nfair value of time-based RSUs is determined using the closing price of the Company’s common stock on the date of grant, reduced\nby the present value of dividends not received during the vesting period. For the time-based RSUs granted during the years ended March\n31, 2026 and 2025, the expected annual dividend yield was 0.0%.\n\n \n\nA\nsummary of time-based RSU activity is presented below:\n\n SCHEDULE\nOF TIME-BASED RSU ACTIVITY\n\n  \nWeighted-  \n  \n\n  \nAverage  \nGrant Date \n\n  \nShares  \nFair Value \n\n  \n   \n  \n\nOutstanding at March 31, 2024 \n 225,000  \n 4.10 \n\nGranted \n 1,105,866  \n$1.11 \n\nVested \n (285,449) \n 3.31 \n\nForfeited \n (445,417) \n 2.78 \n\nOutstanding at March 31, 2025 \n 600,000  \n 0.99 \n\nGranted \n 1,363,044  \n 0.48 \n\nVested \n (367,935) \n 0.67 \n\nForfeited \n (40,761) \n 0.46 \n\nOutstanding at March 31, 2026 \n 1,554,348  \n$0.62 \n\n \n\nThe\ntotal stock compensation expense recognized related to vesting of time-based RSUs for the years ended March 31, 2026 and 2025, was $250\nand $619, respectively, and was recognized on the accompanying consolidated statements of operations as a component of selling, general\nand administrative expenses. As of March 31, 2026, the total unrecognized stock-based compensation for time-based RSUs totaled $914 and\nare expected to be recognized over a weighted average period of 3.1 years.\n\n** **\n\n****\n\nF-22\n\n \n\n** **\n\n**Stock\nOptions**\n\n \n\nThe\nfair value of the share option awards was estimated using the Black-Scholes method using the closing price of the Company’s common\nstock on the date of grant based on the following weighted-average assumptions:\n\n SCHEDULE\nOF FAIR VALUE OF SHARE OPTION AWARDS \n\n  \nYear Ended  \nYear Ended \n\n  \nMarch 31, 2026  \nMarch 31, 2025 \n\n  \n   \n  \n\nExpected option term \n 10.0 years  \n 10.0 years \n\nStock price volatility \n 112.8% \n 138.4%\n\nRisk free interest rate \n 4.00% \n 2.09%\n\nExpected annual dividend yield \n 0.0% \n 0.0%\n\nForfeiture rate \n 23.0% \n 29.9%\n\n \n\nA\nsummary of stock option activity is presented below:\n\nSCHEDULE OF STOCK OPTION ACTIVITY  \n\n  \n   \n   \nWeighted-  \n  \n\n  \n   \nWeighted-  \nAverage  \n  \n\n  \n   \nAverage  \nRemaining  \nAggregate \n\n  \n   \nExercise  \nContractual  \nIntrinsic \n\n  \nOptions  \nPrice  \nLife (Years)  \nValue \n\n  \n   \n   \n   \n  \n\nOutstanding at March 31, 2024 \n 1,108,356  \n 3.42  \n 3.45  \n$595 \n\nGranted \n 688,194  \n 2.15  \n    \n   \n\nForfeited \n (790,000) \n 3.59  \n    \n   \n\nExercised \n -  \n -  \n    \n   \n\nOutstanding at March 31, 2025 \n 1,006,550  \n$2.42  \n 2.85  \n$178 \n\nGranted \n 171,516  \n 0.46  \n    \n   \n\nForfeited \n (534,766) \n 3.20  \n    \n   \n\nExercised \n -  \n -  \n    \n   \n\nOutstanding at March 31, 2026 \n 643,300  \n$1.25  \n 2.05  \n$388 \n\nVested and expected to vest March 31, 2026 \n 588,093  \n$2.66  \n 5.71  \n$- \n\nExercisable at March 31, 2026 \n 425,714  \n$1.16  \n 4.53  \n$37 \n\n \n\nDuring\nAugust 2025, the Company repurchased 208,400 stock options from certain directors and officers at fair value, as determined by the closing\nprice on the date of repurchase, for cash consideration of $60. The repurchase provided for $37 of excess fair value of the cash consideration\nover the fair value of the initial options, which was recognized as compensation expense and included in selling, general and administrative\nexpenses for the year ended March 31, 2026.\n\n \n\nThe\ntotal stock compensation expense recognized related to vesting of stock options for the years ended March 31, 2026 and March 31, 2025\nwas $226 and $715, respectively, and was recognized on the accompanying consolidated statements of operations as a component of selling,\ngeneral and administrative expenses. As of March 31, 2026 the total unrecognized stock-based compensation for stock options was $272\nand is expected to be recognized over a weighted average period of 2.1 years.\n\n** **\n\n**12.\nWARRANTS**\n\n \n\nIn\nconnection with the IPO (see Note 1), the Revolver (see Note 7) and the securities purchase agreement (see Note 10), the Company\nissued stock purchase warrants to certain investors that permit the investor to acquire a fixed amount of shares of common stock at a\nper share price that ranges between $0.46 and $7.50 for a five year term that may be exercised on a cash or cashless basis.\n\n \n\nConcurrently\nwith the closing of the IPO, the Company also issued warrants to purchase up to 66,700 shares of Common Stock to the Representative and\nits designees, at an exercise price of $7.50 per share (the “Underwriter Warrants”). The Underwriter Warrants are exercisable\nbeginning on August 5, 2024, and expire on February 7, 2029.\n\n \n\nAll\nissued warrants were determined to be equity-classified at issuance, and as such, were recorded to additional-paid-in capital at such\ntime.\n\n \n\nF-23\n\n \n\n \n\nThe\nfollowing table summarizes the shares of the Company’s common stock issuable upon exercise of warrants outstanding at March 31,\n2026:\n\n SCHEDULE\nOF COMMON STOCK ISSUABLE UPON EXERCISE OF WARRANTS OUTSTANDING \n\n  \nWarrants Outstanding \n\n  \nExercise\nPrice  \nNumber\nOutstanding  \n\n**Weighted**\n\n**Average**\n\n**Remaining**\n\n**Contractual**\n\n**Life**\n\n**(Years)**\n  \nWeighted\nAverage\nExercise\nPrice \n\nUnderwriter Warrants \n$7.50  \n 66,700  \n 2.87  \n$0.07 \n\nMarch 2025 Warrant \n 1.45  \n 56,676  \n 4.00  \n 0.01 \n\nJune 2025 Warrant \n 0.38  \n 500,000  \n 4.25  \n 0.03 \n\nJuly 2025 Warrant \n 0.38  \n 15,656  \n 4.31  \n 0.00 \n\nAugust 2025 Warrant \n 0.47  \n 3,204,908  \n 2.41  \n 0.22 \n\nJanuary 2026 Warrant \n 0.47  \n 2,900,613  \n 2.41  \n 0.20 \n\n  \n$0.38\n– 7.5  \n 6,744,553  \n 2.57  \n$0.54 \n\n \n\nOf\nthe warrants outstanding, 6,105,521\nshare remain subject to price reset as of March 31, 2026 based on future equity issuances with exercise prices lower than the stated\nexercise price.\n\n \n\nA\nsummary of warrant activity for the periods presented is as follows:\n\n SCHEDULE\nOF WARRANTS ACTIVITY\n\n  \n   \nWeighted- \n\n  \n   \nAverage \n\n  \n   \nExercise \n\n  \nWarrants  \nPrice \n\n  \n   \n  \n\nOutstanding at March 31, 2024 \n 66,700  \n 7.50 \n\nGranted \n 56,676  \n 1.45 \n\nOutstanding at March 31, 2025 \n 123,376  \n$6.65 \n\nGranted \n 8,121,177  \n 0.45 \n\nExercised \n (313,128) \n 0.38 \n\nForfeited \n (1,186,872) \n 0.38 \n\nOutstanding at March 31, 2026 \n 6,744,553  \n$0.54 \n\n \n\nAs of March 31,\n2026 the intrinsic value of the outstanding warrants was $nil.\n\n \n\n**13.\nINCOME TAXES**\n\n \n\nComponents\nof income tax (benefit) expense were as follows:\n\n SCHEDULE OF INCOME TAX BENEFIT EXPENSE \n\n  \n\n**Year\nEnded**\n\n**March\n31, 2026**\n  \n\n**Year\nEnded**\n\n**March\n31, 2025**\n \n\n  \n   \n  \n\nCurrent \n$-  \n$- \n\nDeferred \n -  \n - \n\nTotal\nincome tax (benefit) expense \n$-  \n$- \n\n \n\nThe\nfollowing is a reconciliation of the federal statutory rate to the Company’s effective income tax rate:\n\n SCHEDULE OF RECONCILIATION OF INCOME TAXES \n\n  \n\n**Year\nEnded**\n\n**March\n31, 2026**\n  \n\n**Year\nEnded**\n\n**March\n31, 2025**\n \n\n  \n   \n  \n\n  \n\n**Year\nEnded**\n\n**March\n31, 2026**\n  \n\n**Year\nEnded**\n\n**March\n31, 2025**\n \n\n  \n   \n  \n\nStatutory rate \n 21.0% \n 21.0%\n\nChange in valuation allowance \n (21.0) \n (21.1)\n\nForeign tax differential \n 0.0  \n (1.2)\n\nPermanent\ndifferences \n 0.0  \n 1.3 \n\nEffective\nrate \n 0.0% \n 0.0%\n\n \n\nF-24\n\n \n\n \n\nThe\ntax effects of temporary cumulative differences which give rise to deferred tax assets and liabilities are summarized as follows:\n\n SCHEDULE OF DEFERRED TAX ASSETS AND LIABILITIES \n\n  \nMarch 31, 2026  \nMarch 31, 2025 \n\n  \n   \n  \n\nDeferred tax liabilities: \n    \n   \n\nRelated Party Interest \n$154  \n$- \n\nGain/Loss on Currency \n 37  \n - \n\nFixed and intangible assets \n (50) \n 175 \n\nTotal deferred tax liabilities \n 141  \n 175 \n\nDeferred tax assets: \n    \n   \n\nTax loss carryforward \n 11,511  \n 10,284 \n\nStock compensation expense \n 446  \n 815 \n\nIPO expenses \n -  \n 163 \n\nInterest Expense \n 5  \n - \n\nValuation allowance \n (11,821) \n (11,087)\n\nTotal deferred tax assets \n 141  \n 175 \n\nDeferred tax assets, net \n$-  \n$- \n\n \n\nDuring\nthe years ended March 31, 2026 and 2025, the Company recorded an increase in the valuation allowance of $734 and $3,190, respectively,\nrelated to federal deferred tax assets. Deferred tax assets are recorded related to net operating losses and temporary differences between\nthe book and tax bases of assets and liabilities expected to produce tax deductions in future periods. The realization of these assets\ndepends on recognition of sufficient future taxable income in specific tax jurisdictions in which those temporary differences or net\noperating losses are deductible.\n\n \n\nThroughout\nthe year ended March 31, 2026, the Company has been assessing the realizability of its deferred tax assets by considering positive factors\nsuch as the next three years’ profit projection making it more likely than not that the Company will be able to recognize a deferred\ntax asset on losses. Based upon historical performance of the Company, a valuation allowance of 100% was recorded as there is currently\nno significant evidence to indicate realizability of deferred tax assets. During the years ended March 31, 2026 and 2025, the Company\nrecorded a valuation allowance of 100% and 100% of UK and Hong Kong losses.\n\n \n\nThe\nCompany is subject to US federal income tax, as well as income tax in multiple US state and local jurisdictions and a number of foreign\njurisdictions. Returns for the years since fiscal year 2022 are still open based on statutes of limitation only.\n\n** **\n\n**14.\nCOMMITMENTS AND CONTINGENCIES**\n\n \n\n**Notice\nfrom NYSE***–* On December 17, 2024 the Company received a notification from the NYSE American LLC (the “NYSE”)\nstating that the Company was not in compliance with the minimum stockholders’ equity requirements of Sections 1003(a)(ii) of the\nNYSE American Company Guide (the “Company Guide”) requiring stockholders’ equity of $4,000 or more if the Company has\nreported losses from continuing operations and/or net losses in three of the four most recent fiscal years. As of March 31, 2026, the\nCompany had stockholders’ deficit of approximately $686 and had losses in its three most recent fiscal years ended March 31, 2026.  \n\n \n\nThe Company was then subject\nto the procedures and requirements of Section 1009 of the Company Guide. The Company had until June 11, 2026 to regain compliance with\nthe Company Guide. The Company submitted a plan of action to regain compliance with the Company Guide (the “Plan”) on January\n10, 2025, which the NYSE accepted on March 4, 2025. Accordingly, the Company was able to continue its listing during the Plan period and\nwas subject to periodic reviews including quarterly monitoring for compliance with the Plan until it has regained compliance.\n\n \n\nThe\nnotification and Plan acceptance has no immediate effect on the listing or trading of the Company’s common stock on the NYSE. The\nNYSE’s acceptance of the Company’s Plan does not affect the Company’s business, operations or reporting requirements\nwith the U.S. Securities and Exchange Commission.\n\n \n\n**Legal\nproceedings***-*The Company is, from time to time, involved in routine legal matters, and audits and inspections by governmental\nagencies and other third parties which are incidental to the conduct of its business. This includes legal matters such as initiation\nand defense of proceedings to protect intellectual property rights, liability claims, employment claims, and similar matters. The Company\nbelieves the ultimate resolution of any such legal proceedings, audits, and inspections will not have a material adverse effect on its\nconsolidated balance sheets, results of operations or cash flow.\n\n \n\nF-25\n\n \n\n \n\nOn\nMay 14, 2025, we were named as a defendant in a lawsuit filed in the Superior Court of the State of California in and for the County\nof Los Angeles Central Judicial District by Amanda Archer and Archer Bytes LLC, a former public relations consultant for the Company.\nThe complaint alleges breach of contract, and other claims and seeks specific damages of $600,000 and unspecified punitive damages. We\nbelieve the claims are entirely without merit and continue to vigorously defend the matter.\n\n \n\nOn\nOctober 6, 2025, the Company received notice that its former Chief Executive Officer of the Company, Mark Buckley, filed Grounds of Complaint\nwith the UK Employment Tribunal against the Company alleging, among other things, unfair dismissal from his position. The Company filed\nits Grounds of Resistance to Mr. Buckley’s claims on October 30, 2025. The Company intends to continue vigorously defending the\nmatter. The Company’s attempts to resolve the dispute will continue in parallel with the ongoing litigation.\n\n \n\n**Capital\ncommitments** - The Company had $7,934 of purchase obligations as of March 31, 2026, related to purchase orders to factories for\nthe manufacture of finished goods. \n\n \n\n**15.\nRELATED PARTY TRANSACTIONS**\n\n \n\n*Consulting\nand Advisory Services*\n\n \n\nOne\ndirector of the Company provided consulting and advisory services for the Company totaling $292 and $185 for the years ended March 31,\n2026 and 2025, respectively, and are included in selling, general and administrative expenses on the accompanying consolidated statement\nof operations and comprehensive loss.\n\n \n\n*Series\nAA Preferred Stock*\n\n \n\nIn\nMarch 2025, the Company entered into securities purchase agreements with a company controlled by the Chairman whereby the Company\nissued 344,797\nshares of Series AA Preferred Stock at an original issue price of $5.8005\nper share for gross proceeds of $2,000.\nOn January 15, 2026, the Company issued 11,458,306\nshares of its common stock upon conversion of all outstanding shares of the Series AA Preferred Stock held by the company controlled\nby the Chairman (see Note 10).\n\n \n\n*Line\nof Credit*\n\n* *\n\nOne of the\nlenders on the Revolver was an investor of the Company that owned more than 5.0% of outstanding shares of the Company. Refer to Note\n9 for further details.\n\n \n\nSee Note 9 for further discussion of notes payable issued\nto related parties.\n\n \n\n**16.\nSEGMENT REPORTING**\n\n** **\n\nThe\nfollowing table includes additional information about reported segment revenue, significant segment expenses and segment measure of profitability:\n\n \n\nSCHEDULE\nOF SEGMENT REVENUE, SIGNIFICANT SEGMENT EXPENSES AND SEGMENT MEASURE OF PROFITABILITY\n\n  \n\n**Year ended**\n\n**March 31, 2026**\n  \n\n**Year ended**\n\n**March 31, 2025**\n \n\nRevenue, net \n$23,603  \n$21,501 \n\nLess: \n    \n   \n\nSignificant segment expenses \n -  \n  \n\nCost of Revenue \n 7,644  \n 11,072 \n\nSelling expense \n 4,204  \n 3,916 \n\nGeneral and administrative \n 12,727  \n 14,501 \n\nMarketing and advertising \n 3,234  \n 3,540 \n\nNon-cash compensation \n 1,034  \n 2,244 \n\nOther segment items(1) \n 1,891  \n 2,167 \n\nNet loss \n$(7,131) \n$(15,939)\n\n \n\n \n(1)\nIncludes\ninterest expense, foreign currency transactions gain (loss), and other income.\n\n \n\nSee\nNote 2 for revenue by geographic location. Long-lived assets, excluding other non-current assets, by geography are summarized as follows:\n\n \n\nSCHEDULE\nOF LONG-LIVED ASSETS, EXCLUDING OTHER NON-CURRENT ASSETS, BY GEOGRAPHY \n\n  \n\n**Year ended**\n\n**March 31, 2026**\n  \n\n**Year ended**\n\n**March 31, 2025**\n \n\nUnited Kingdom \n$1,357  \n$478 \n\nHong Kong \n -  \n 49 \n\nTotal long-lived assets \n$1,357  \n$527 \n\n \n\n**17.\nSUBSEQUENT EVENTS**\n\n \n\nThe\nCompany evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the consolidated\nfinancial statements were issued. Based upon this review, other than as described below or within these consolidated financial statements,\nthe Company did not identify any other subsequent events that would have required adjustment or disclosure in the consolidated financial\nstatements.\n\n \n\nOn\nMay 8, 2026, the Company consummated a securities purchase agreement with one of the lenders of the Revolver under which it issued 6,060,606\nshares of its common stock at a purchase price of $0.33\nper share and warrants to purchase up to 8,276,944\nshares of its common stock at an exercise price of $0.40\nper share and expiring on August\n27, 2028 for gross proceeds of $2,000 (the “May 2026 Securities Purchase Agreement”).\nIn connection with the May 2026 Securities Purchase Agreement, the Company issued warrants to purchase up to 1,864,753\nshares of its common stock at an exercise price of $0.46822\nper share and expiring on August\n27, 2028 to the other lender of the Revolver.\n\n \n\nOn June\n12, 2026, the Company received a notice (the “Delisting Notice”) from NYSE Regulation informing the Company that NYSE Regulation\nhas determined to commence proceedings to delist the common stock of Perfect Moment Ltd. (ticker symbol: PMNT) from NYSE American. NYSE\nRegulation determined that the Company is no longer suitable for listing pursuant to Section 1009(a) of the NYSE American Company Guide\n(the “Company Guide”), as the Company was unable to demonstrate that it had regained compliance with Sections 1003(a)(i) and\n1003(a)(ii) of the Company Guide by the end of the maximum 18-month compliance plan period, which expired on June 11, 2026. Section 1003(a)(i)\napplies where a listed company has stockholders’ equity of less than $2.0 million and has reported losses from continuing operations and/or\nnet losses in two of its three most recent fiscal years, and Section 1003(a)(ii) applies where a listed company has stockholders’ equity\nof less than $4.0 million and has reported losses from continuing operations and/or net losses in three of its four most recent fiscal\nyears.\n\n \n\nNYSE American made a public announcement of this decision on June 12, 2026.\nNYSE American awill apply to the U.S. Securities and Exchange Commission to delist the Company’s common stock upon completion of applicable\nprocedures, including any appeal by the Company of NYSE Regulation’s decision. Effective June 18, 2026 the Company’s common stock\nbegan trading on the OTCQB Venture Market (the “OTCQB”) under the symbol “PMNT.” The OTCQB\nis a significantly more limited market than NYSE American, and trading on the OTCQB may result in a less liquid market for existing and\npotential stockholders of the Company’s common stock and could adversely affect the trading price of the Company’s common stock.\n\n \n\nF-26\n\n \n\n \n\n**INDEX\nTO EXHIBITS**\n\n \n\nThe\nexhibits listed below are filed as part of this Report on Form 10-K, or are incorporated herein by reference, in each case as indicated\nbelow.\n\n \n\n**Exhibit**\n \n \n \n**Incorporated\nby Reference**\n\n**Number**\n \n**Description**\n \n**Form**\n \n**File\nNo.**\n \n**Exhibit**\n \n**Filing\nDate**\n\n3.1\n \n[Amended and Restated Certificate of Incorporation of the Company](https://www.sec.gov/Archives/edgar/data/1849221/000121390024013346/ea193522ex3-1_perfect.htm)\n \n8-K\n \n001-41930\n \n3.1\n \nFebruary\n13, 2024\n\n \n \n \n \n \n \n \n \n \n \n \n\n3.2\n \n[Amended and Restated Bylaws of the Company](https://www.sec.gov/Archives/edgar/data/1849221/000121390024013346/ea193522ex3-2_perfect.htm)\n \n8-K\n \n001-41930\n \n3.2\n \nFebruary\n13, 2024\n\n \n \n \n \n \n \n \n \n \n \n \n\n3.3\n \n[Certificate of Designations of 12.00% Series AA Convertible Preferred Stock.](https://www.sec.gov/Archives/edgar/data/1849221/000164117225002258/ex3-1.htm)\n \n8-K\n \n001-41930\n \n3.1\n \nApril\n2, 2025\n\n \n \n \n \n \n \n \n \n \n \n \n\n3.4\n \n\n[Certificate of Adoption of Bylaw Amendment](https://www.sec.gov/Archives/edgar/data/1849221/000149315225017789/ex3-1.htm)\n\n \n8-K\n \n001-41930\n \n\n3.1\n\n \nOctober 10, 2025\n\n \n \n \n \n \n \n \n \n \n \n \n\n3.5\n \n\n[Certificate of Amendment of Certificate Designations, Preferences, Limitations, Restrictions and Relative Rights 12.00% Series AA Convertible Preferred Stock of Perfect Moment Ltd.](https://www.sec.gov/Archives/edgar/data/1849221/000149315226003111/ex3-1.htm)\n\n \n8-K\n \n001-41930\n \n3.1\n \nJanuary 21, 2026\n\n \n \n \n \n \n \n \n \n \n \n \n\n4.1\n \n[Form of the Company’s Common Stock Certificate](https://www.sec.gov/Archives/edgar/data/1849221/000121390023083790/ea187099ex4-1_perfect.htm)\n \nS-1\n \n333-274913\n \n4.1\n \nNovember\n6, 2023\n\n \n \n \n \n \n \n \n \n \n \n \n\n4.2\n \n[Form of Underwriter Warrants](https://www.sec.gov/Archives/edgar/data/1849221/000121390024005122/ea191935ex4-2_perfect.htm)\n \nS-1\n \n333-274913\n \n4.2\n \nJanuary\n22, 2024\n\n \n \n \n \n \n \n \n \n \n \n \n\n4.3\n \n[Form of Convertible Promissory Note for 2021 Debt Financing](https://www.sec.gov/Archives/edgar/data/1849221/000121390023083790/ea187099ex4-3_perfect.htm)\n \nS-1\n \n333-274913\n \n4.3\n \nNovember\n6, 2023\n\n \n \n \n \n \n \n \n \n \n \n \n\n4.4\n \n[Form of Amendment No. 1 to Convertible Promissory Note for 2021 Debt Financing](https://www.sec.gov/Archives/edgar/data/1849221/000121390023083790/ea187099ex4-4_perfect.htm)\n \nS-1\n \n333-274913\n \n4.4\n \nNovember\n6, 2023\n\n \n \n \n \n \n \n \n \n \n \n \n\n4.5\n \n[Form of Amendment No. 2 to Convertible Promissory Note for 2021 Debt Financing](https://www.sec.gov/Archives/edgar/data/1849221/000121390023083790/ea187099ex4-5_perfect.htm)\n \nS-1\n \n333-274913\n \n4.5\n \nNovember\n6, 2023\n\n \n \n \n \n \n \n \n \n \n \n \n\n4.6\n \n[Form of Amendment No. 3 to Convertible Promissory Note for 2021 Debt Financing](https://www.sec.gov/Archives/edgar/data/1849221/000121390024004597/ea191661ex4-6_perfect.htm)\n \nS-1\n \n333-274913\n \n4.6\n \nJanuary\n18, 2024\n\n \n \n \n \n \n \n \n \n \n \n \n\n4.7\n \n[Form of Convertible Promissory Note for 2022 Debt Financing](https://www.sec.gov/Archives/edgar/data/1849221/000121390023083790/ea187099ex4-6_perfect.htm)\n \nS-1\n \n333-274913\n \n4.6\n \nNovember\n6, 2023\n\n \n \n \n \n \n \n \n \n \n \n \n\n4.8\n \n[Form of Amendment No. 1 to Convertible Promissory Note for 2022 Debt Financing](https://www.sec.gov/Archives/edgar/data/1849221/000121390023083790/ea187099ex4-7_perfect.htm)\n \nS-1\n \n333-274913\n \n4.7\n \nNovember\n6, 2023\n\n \n \n \n \n \n \n \n \n \n \n \n\n4.9\n \n[Form of Amendment No. 2 to Convertible Promissory Note for 2022 Debt Financing](https://www.sec.gov/Archives/edgar/data/1849221/000121390024004597/ea191661ex4-9_perfect.htm)\n \nS-1\n \n333-274913\n \n4.9\n \nJanuary\n18, 2024\n\n \n \n \n \n \n \n \n \n \n \n \n\n4.10\n \n[Form of Convertible Secured Note dated December 6, 2024](https://www.sec.gov/Archives/edgar/data/1849221/000149315224049818/ex10-2.htm)\n \n8-K\n\n \n001-41930\n \n10.2\n \nDecember\n12, 2024\n\n \n \n \n \n \n \n \n \n \n \n \n\n4.11\n \n[Form of Placement Agent Warrant](https://www.sec.gov/Archives/edgar/data/1849221/000164117225002258/ex4-1.htm)\n \n8-K\n \n001-41930\n \n4.1\n \nApril\n2, 2025\n\n \n \n \n \n \n \n \n \n \n \n \n\n4.12\n \n[Representative’s Warrants](https://www.sec.gov/Archives/edgar/data/1849221/000164117225017210/ex4-1.htm)\n \n8-K\n \n001-41930\n \n4.1\n \nJune 30, 2025\n\n \n \n \n \n \n \n \n \n \n \n \n\n4.13\n \n[Promissory Note, Dated August 26, 2025](https://www.sec.gov/Archives/edgar/data/1849221/000164117225025619/ex10-1.htm)\n \n8-K\n \n001-41930\n \n10.1\n \nAugust 27, 2025\n\n \n \n \n \n \n \n \n \n \n \n \n\n4.14\n \n[Promissory Note, Dated August 26, 2025](https://www.sec.gov/Archives/edgar/data/1849221/000164117225025619/ex10-2.htm)\n \n8-K\n \n001-41930\n \n10.2\n \nAugust 27, 2025\n\n \n \n \n \n \n \n \n \n \n \n \n\n4.15\n \n\n[Form of Warrant](https://www.sec.gov/Archives/edgar/data/1849221/000149315225012391/ex4-1.htm)\n\n \n8-K\n \n001-41930\n \n4.1\n \nAugust 27, 2025\n\n \n \n \n \n \n \n \n \n \n \n \n\n4.16\n \n[Amended and Restated Promissory Note, dated October 30, 2025](https://www.sec.gov/Archives/edgar/data/1849221/000149315225020316/ex10-1.htm)\n \n8-K\n \n001-41930\n \n10.1\n \nOctober 31, 2025\n\n \n \n \n \n \n \n \n \n \n \n \n\n4.17\n \n[Amended Warrant 1](https://www.sec.gov/Archives/edgar/data/1849221/000149315226003111/ex4-1.htm)\n \n8-K\n \n001-41930\n \n4.1\n \nJanuary 21, 2026\n\n \n \n \n \n \n \n \n \n \n \n \n\n4.18\n \n[Warrant 2](https://www.sec.gov/Archives/edgar/data/1849221/000149315226003111/ex4-2.htm)\n \n8-K\n \n001-41930\n \n4.2\n \nJanuary 21, 2026\n\n \n \n \n \n \n \n \n \n \n \n \n\n4.19\n \n[Further Amended and Restated Promissory Note, dated March 6, 2026](https://www.sec.gov/Archives/edgar/data/1849221/000149315226009173/ex4-1.htm)\n \n8-K\n \n001-41930\n \n4.1\n \nMarch 6, 2026\n\n \n \n \n \n \n \n \n \n \n \n \n\n4.20\n \n[Second Further Amended and Restated Promissory Note, dated March 20, 2026](https://www.sec.gov/Archives/edgar/data/1849221/000149315226012008/ex4-1.htm)\n \n8-K\n \n001-41930\n \n4.1\n \nMarch 20, 2026\n\n \n \n \n \n \n \n \n \n \n \n \n\n4.21\n \n[Form of X3 Warrant](https://www.sec.gov/Archives/edgar/data/1849221/000149315226022520/ex4-1.htm)\n \n8-K\n \n001-41930\n \n4.1\n \nMay 12, 2026\n\n \n \n \n \n \n \n \n \n \n \n \n\n4.22\n \n[Form of Krane Warrant](https://www.sec.gov/Archives/edgar/data/1849221/000149315226022520/ex4-2.htm)\n \n8-K\n \n001-41930\n \n4.2\n \nMay 12, 2026\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.1+\n \n[Employment Agreement between Perfect Moment Ltd. and Jeff Clayborne](https://www.sec.gov/Archives/edgar/data/1849221/000121390023083790/ea187099ex10-2_perfect.htm)\n \nS-1\n \n333-274913\n \n10.2\n \nNovember\n6, 2023\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.2+\n \n[Amendment No. 1 to Employment Agreement between Perfect Moment Ltd. and Jeff Clayborne](https://www.sec.gov/Archives/edgar/data/1849221/000121390024005122/ea191935ex10-3_perfect.htm)\n \nS-1\n \n333-274913\n \n10.3\n \nJanuary\n22, 2024\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.3+\n \n[Independent Director Agreement between Perfect Moment Ltd. and Andre Keijsers](https://www.sec.gov/Archives/edgar/data/1849221/000121390024004597/ea191661ex10-20_perfect.htm)\n \nS-1\n \n333-274913\n \n10.20\n \nJanuary\n18, 2024\n\n \n\n60\n\n \n\n \n\n**Exhibit**\n \n \n \n**Incorporated\nby Reference**\n\n**Number**\n \n**Description**\n \n**Form**\n \n**File\nNo.**\n \n**Exhibit**\n \n**Filing\nDate**\n\n10.4+\n \n[Independent Director Agreement between Perfect Moment Ltd. and Berndt Hauptkorn](https://www.sec.gov/Archives/edgar/data/1849221/000121390024004597/ea191661ex10-21_perfect.htm)\n \nS-1\n \n333-274913\n \n10.21\n \nJanuary\n18, 2024\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.5+\n \n[Independent Director Agreement between Perfect Moment Ltd. and Tracy Barwin](https://www.sec.gov/Archives/edgar/data/1849221/000121390024004597/ea191661ex10-22_perfect.htm)\n \nS-1\n \n333-274913\n \n10.22\n \nJanuary\n18, 2024\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.6+\n \n[Form of Indemnification Agreement for Directors and Officers](https://www.sec.gov/Archives/edgar/data/1849221/000121390023083790/ea187099ex10-21_perfect.htm)\n \nS-1\n \n333-274913\n \n10.21\n \nNovember\n6, 2023\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.7\n \n[Guarantee Agreement between Perfect Moment Asia Limited and J. Gottschalk & Associates](https://www.sec.gov/Archives/edgar/data/1849221/000121390023083790/ea187099ex10-37_perfect.htm)\n \nS-1\n \n333-274913\n \n10.37\n \nNovember\n6, 2023\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.8\n \n[Amendment to UBS Switzerland AG Standby Documentary Credit](https://www.sec.gov/Archives/edgar/data/1849221/000121390023092062/ea188703ex10-40_perfect.htm)\n \nS-1\n \n333-274913\n \n10.40\n \nDecember\n1, 2023\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.9+\n \n[Employment Agreement between Perfect Moment (UK) Limited and Mark Buckley](https://www.sec.gov/Archives/edgar/data/1849221/000121390023083790/ea187099ex10-1_perfect.htm)\n \nS-1\n \n333-274913\n \n10.1\n \nNovember\n6, 2023\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.10+\n \n[Employment Agreement between Perfect Moment (UK) Limited and Jane Gottschalk](https://www.sec.gov/Archives/edgar/data/1849221/000121390023083790/ea187099ex10-3_perfect.htm)\n \nS-1\n \n333-274913\n \n10.3\n \nNovember\n6, 2023\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.11+\n \n[Consulting Agreement between Perfect Moment Asia Limited and Max Gottschalk](https://www.sec.gov/Archives/edgar/data/1849221/000121390023083790/ea187099ex10-4_perfect.htm)\n \nS-1\n \n333-274913\n \n10.4\n \nNovember\n6, 2023\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.12+\n \n[Board Member Agreement between Perfect Moment Asia Limited and Tracy Barwin](https://www.sec.gov/Archives/edgar/data/1849221/000121390023083790/ea187099ex10-6_perfect.htm)\n \nS-1\n \n333-274913\n \n10.6\n \nNovember\n6, 2023\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.13+\n \n[2021 Equity Incentive Plan and forms of award agreements thereunder](https://www.sec.gov/Archives/edgar/data/1849221/000121390023083790/ea187099ex10-8_perfect.htm)\n \nS-1\n \n333-274913\n \n10.8\n \nNovember\n6, 2023\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.14+\n \n[Amendment No. 1 to 2021 Equity Incentive Plan](https://www.sec.gov/Archives/edgar/data/1849221/000121390024006750/ea192247ex10-10_perfect.htm)\n \nS-1\n \n333-274913\n \n10.10\n \nJanuary\n26, 2024\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.15+\n \n[Independent Director Agreement between Perfect Moment Ltd. and Tim Nixdorff](https://www.sec.gov/Archives/edgar/data/1849221/000121390024004597/ea191661ex10-23_perfect.htm)\n \nS-1\n \n333-274913\n \n10.23\n \nJanuary\n18, 2024\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.16\n \n[Facility Letter Agreement between Perfect Moment Asia Limited and HSBC](https://www.sec.gov/Archives/edgar/data/1849221/000121390023083790/ea187099ex10-31_perfect.htm)\n \nS-1\n \n333-274913\n \n10.31\n \nNovember\n6, 2023\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.17\n \n[Amendment to Facility Letter Agreement, dated April 11, 2023, between Perfect Moment Asia Limited and HSBC](https://www.sec.gov/Archives/edgar/data/1849221/000121390023083790/ea187099ex10-32_perfect.htm)\n \nS-1\n \n333-274913\n \n10.32\n \nNovember\n6, 2023\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.18\n \n[Amendment to Facility Letter Agreement, dated July 10, 2023, between Perfect Moment Asia Limited and HSBC](https://www.sec.gov/Archives/edgar/data/1849221/000121390023083790/ea187099ex10-33_perfect.htm)\n \nS-1\n \n333-274913\n \n10.33\n \nNovember\n6, 2023\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.19\n \n[UBS Switzerland AG Standby Documentary Credit](https://www.sec.gov/Archives/edgar/data/1849221/000121390023083790/ea187099ex10-34_perfect.htm)\n \nS-1\n \n333-274913\n \n10.34\n \nNovember\n6, 2023\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.20\n \n[Charge over Securities and Deposits between Perfect Moment Asia Limited and HSBC](https://www.sec.gov/Archives/edgar/data/1849221/000121390023083790/ea187099ex10-35_perfect.htm)\n \nS-1\n \n333-274913\n \n10.35\n \nNovember\n6, 2023\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.21\n \n[Guarantee of Perfect Moment Limited](https://www.sec.gov/Archives/edgar/data/1849221/000121390023083790/ea187099ex10-36_perfect.htm)\n \nS-1\n \n333-274913\n \n10.36\n \nNovember\n6, 2023\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.22\n \n[Share Registration Agreement](https://www.sec.gov/Archives/edgar/data/1849221/000121390024006750/ea192247ex10-44_perfect.htm)\n \nS-1\n \n333-274913\n \n10.44\n \nJanuary\n26, 2024\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.23\n \n[Form of Lock-Up Agreement](https://www.sec.gov/Archives/edgar/data/1849221/000121390024006750/ea192247ex10-45_perfect.htm)\n \nS-1\n \n333-274913\n \n10.45\n \nJanuary\n26, 2024\n\n \n\n61\n\n \n\n \n\n10.24\n \n[Perfect Moment Ltd. Enterprise Management Incentive Share Option Agreement with Negin Yeganegy](https://www.sec.gov/Archives/edgar/data/1849221/000121390024016555/ea193841ex99-3_perfectmoment.htm)\n \nS-8\n \n333-277335\n \n99.3\n \nFebruary\n23, 2024\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.25\n \n[Excerpts from the Settlement Agreement, dated October 26, 2022, by and between Perfect Moment UK Limited and Negin Yeganegy, relating to the Perfect Moment Ltd. Enterprise Management Incentive Share Option Agreement with Negin Yeganegy](https://www.sec.gov/Archives/edgar/data/1849221/000121390024016555/ea193841ex99-4_perfectmoment.htm)\n \nS-8\n \n333-277335\n \n99.4\n \nFebruary\n23, 2024\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.26\n \n[Subordinated Business Loan and Security Agreement dated July 25, 2024](https://www.sec.gov/Archives/edgar/data/1849221/000149315224034368/ex10-1.htm)\n \n8-K\n \n001-41930\n \n10.1\n \nAugust\n29, 2024\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.27\n \n[Subordinated Business Loan and Security Agreement dated August 23, 2024](https://www.sec.gov/Archives/edgar/data/1849221/000149315224034368/ex10-2.htm)\n \n8-K\n \n001-41930\n \n10.2\n \nAugust\n29, 2024\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.28\n \n[Standard Merchant Cash Advance Agreement dated September 25, 2024](https://www.sec.gov/Archives/edgar/data/1849221/000149315224045852/ex10-3.htm)\n \n10-Q\n \n001-41930\n \n10.3\n \nNovember\n14, 2024\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.29\n \n[Subordinated Business Loan and Security Agreement dated September 30, 2024](https://www.sec.gov/Archives/edgar/data/1849221/000149315224045852/ex10-4.htm)\n \n10-Q\n \n001-41930\n \n10.4\n \nNovember\n14, 2024\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.30\n \n[Business Loan and Security Agreement dated October 23, 2024](https://www.sec.gov/Archives/edgar/data/1849221/000149315224045852/ex10-5.htm)\n \n10-Q\n \n001-41930\n \n10.5\n \nNovember\n14, 2024\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.31\n \n[Business Loan and Security Agreement dated November 24, 2024](https://www.sec.gov/Archives/edgar/data/1849221/000149315225006515/ex10-3.htm)\n \n10-Q\n \n001-41930\n \n10.3\n \nFebruary\n14, 2025\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.32\n \n[Form of Convertible Secured Note Purchase Agreement dated December 6, 2024](https://www.sec.gov/Archives/edgar/data/1849221/000149315224049818/ex10-1.htm)\n \n8-K\n \n001-41930\n \n10.1\n \nDecember\n12, 2024\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.33\n \n[Licence Agreement dated January 10, 2024](https://www.sec.gov/Archives/edgar/data/1849221/000149315224050277/ex6-32.htm)\n \n1-A\n \n024-12548\n \n6.32\n \nDecember\n16, 2024\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.34+\n \n[Consulting Agreement between Perfect Moment (UK) Limited and Vittorio Giacomelli](https://www.sec.gov/Archives/edgar/data/1849221/000149315225005241/ex10-1.htm)\n \n8-K\n \n001-41930\n \n10.1\n \nFebruary\n6, 2025\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.35+\n \n[Employment Agreement between Perfect Moment (UK) Limited and Chath Weerasinghe](https://www.sec.gov/Archives/edgar/data/1849221/000149315225005241/ex10-2.htm)\n \n8-K\n \n001-41930\n \n10.2\n \nFebruary\n6, 2025\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.36+\n \n[Restricted Stock Unit Agreement dated February 3, 2025, between the Company and Chath Weerasinghe](https://www.sec.gov/Archives/edgar/data/1849221/000149315225005241/ex10-3.htm)\n \n8-K\n \n001-41930\n \n10.3\n \nFebruary\n6, 2025\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.37+\n \n[Amendment to Contract of Employment between Perfect Moment (UK) Limited and Jane Gottschalk](https://www.sec.gov/Archives/edgar/data/1849221/000149315225005241/ex10-4.htm)\n \n8-K\n \n001-41930\n \n10.4\n \nFebruary\n6, 2025\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.38\n \n[Form of Securities Purchase Agreement, dated March 28, 2025, between the Registrant and the investors party thereto.](https://www.sec.gov/Archives/edgar/data/1849221/000164117225002258/ex10-1.htm)\n \n8-K\n \n001-41930\n \n10.1\n \nApril\n2, 2025\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.39\n \n[Form of Registration Rights Agreement, dated March 28, 2025, between the Registrant and the investors party thereto.](https://www.sec.gov/Archives/edgar/data/1849221/000164117225002258/ex10-2.htm)\n \n8-K\n \n001-41930\n \n10.2\n \nApril\n2, 2025\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.40\n \n[Placement Agency Agreement, dated March 28, 2025, between the Registrant and the Placement Agent](https://www.sec.gov/Archives/edgar/data/1849221/000164117225002258/ex10-3.htm)\n \n8-K\n \n001-41930\n \n10.3\n \nApril\n2, 2025\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.41\n \n\n[Underwriting Agreement, dated June 26, 2025, between Perfect Moment Ltd. and ThinkEquity LLC](https://www.sec.gov/Archives/edgar/data/1849221/000164117225017210/ex1-1.htm)\n\n \n8-K\n \n001-41930\n \n1.1\n \nJune 30, 2025\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.42\n \n[Securities Purchase Agreement, dated June 30, 2025, between Perfect Moment and Joachim Gottschalk & Associates](https://www.sec.gov/Archives/edgar/data/1849221/000164117225017210/ex1-2.htm)\n \n8-K\n \n001-41930\n \n1.2\n \nJune 30, 2025\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.43\n \n\n[Securities Purchase Agreement dated August 27, 2025 by and between Perfect Moment Ltd. and X3 Higher Moment Fund LLC ](https://www.sec.gov/Archives/edgar/data/1849221/000149315225012391/ex10-1.htm)\n\n \n8-K\n \n001-41930\n \n10.1\n \nAugust 27, 2025\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.44\n \n\n[Securities Purchase Agreement dated August 27, 2025 by and between Perfect Moment Ltd. and X3 Higher Moment Fund LLC ](https://www.sec.gov/Archives/edgar/data/1849221/000149315225012391/ex10-2.htm)\n\n \n8-K\n \n001-41930\n \n10.2\n \nAugust 27, 2025\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.45\n \n\n[Equity Purchase Agreement, dated October 7, 2025 between the Company and the Investor](https://www.sec.gov/Archives/edgar/data/1849221/000149315225017790/ex10-1.htm)\n\n \n8-K\n \n001-41930\n \n10.1\n \nOctober 10, 2025\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.46\n \n\n[Registration Rights Agreement, dated October 7, 2025, between the Company and the Investor](https://www.sec.gov/Archives/edgar/data/1849221/000149315225017790/ex10-2.htm)\n\n \n8-K\n \n001-41930\n \n10.2\n \nOctober 10, 2025\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.47\n \n[Loan Agreement, dated March 30, 2026 by and between Perfect Moment Ltd. and X3 Higher Moment Fund LLC](https://www.sec.gov/Archives/edgar/data/1849221/000149315226013556/ex10-1.htm)\n \n8-K\n \n001-41930\n \n10.1\n \nMarch 30, 2026\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.48\n \n[Guaranty](https://www.sec.gov/Archives/edgar/data/1849221/000149315226013556/ex10-2.htm)\n \n8-K\n \n001-41930\n \n10.2\n \nMarch 30, 2026\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.49\n\n \n[Security Agreement, dated March 30, 2026 by and between Perfect Moment Ltd. and X3 Higher Moment Fund LLC](https://www.sec.gov/Archives/edgar/data/1849221/000149315226013556/ex10-3.htm)\n \n8-K\n \n001-41930\n \n10.3\n \nMarch 30, 2026\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.50\n \n[Pledge Agreement, dated March 30, 2026 by and between Perfect Moment Ltd. and X3 Higher Moment Fund LLC](https://www.sec.gov/Archives/edgar/data/1849221/000149315226013556/ex10-4.htm)\n \n8-K\n \n001-41930\n \n10.4\n \nMarch 30, 2026\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.51\n \n[Intellectual Property Security Agreement, dated March 30, 2026 by and between Perfect Moment (UK) Limited and X3 Higher Moment Fund LLC](https://www.sec.gov/Archives/edgar/data/1849221/000149315226013556/ex10-5.htm)\n \n8-K\n \n001-41930\n \n10.5\n \nMarch 30, 2026\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.52\n \n[Securities Purchase Agreement dated March 30, 2026 by and between Perfect Moment Ltd. and X3 Higher Moment Fund LLC](https://www.sec.gov/Archives/edgar/data/1849221/000149315226013556/ex10-6.htm)\n \n8-K\n \n001-41930\n \n10.6\n \nMarch 30, 2026\n\n \n \n \n \n \n \n \n \n \n \n \n\n10.53\n \n[Form of Registration Rights Agreement by and between Perfect Moment Ltd., X3 Higher Moment Fund LLC and Krane Capital Management LLC](https://www.sec.gov/Archives/edgar/data/1849221/000149315226013556/ex10-7.htm)\n \n8-K\n \n001-41930\n \n10.7\n \nMarch 30, 2026\n\n \n\n62\n\n \n\n \n\n19.1\n \n[Insider Trading Policy](ex19-1.htm)\n \n \n \n \n \n \n \n \n\n \n \n \n \n \n \n \n \n \n \n \n\n21.1\n \n[Subsidiaries of the Company](https://www.sec.gov/Archives/edgar/data/1849221/000121390024004597/ea191661ex21-1_perfect.htm)\n \nS-1\n \n333-274913\n \n21.1\n \nJanuary\n18, 2024\n\n \n \n \n \n \n \n \n \n \n \n \n\n23.1\n \n[Consent of Weinberg & Company, P.A.](ex23-1.htm)\n \n \n \n \n \n \n \n \n\n \n \n \n \n \n \n \n \n \n \n \n\n31.1\n \n[Certification of the Principal Executive Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002](ex31-1.htm)\n \n \n \n \n \n \n \n \n\n \n \n \n \n \n \n \n \n \n \n \n\n31.2\n \n[Certification of the Principal Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002](ex31-2.htm)\n \n \n \n \n \n \n \n \n\n \n \n \n \n \n \n \n \n \n \n \n\n32.1*\n \n[Certifications of the Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002](ex32-1.htm)\n \n \n \n \n \n \n \n \n\n \n \n \n \n \n \n \n \n \n \n \n\n32.2**\n \n[Certifications of the Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002](ex32-2.htm)\n \n \n \n \n \n \n \n \n\n \n \n \n \n \n \n \n \n \n \n \n\n97.1*\n \n[Perfect Moment Ltd. Clawback Policy](ex97-1.htm)\n \n \n \n \n \n \n \n \n\n \n \n \n \n \n \n \n \n \n \n \n\n101.INS\n \nInline\nXBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within\nthe Inline XBRL document).\n \n \n \n \n \n \n \n \n\n \n \n \n \n \n \n \n \n \n \n \n\n101.SCH\n \nInline\nXBRL Taxonomy Extension Calculation Linkbase Document\n \n \n \n \n \n \n \n \n\n \n \n \n \n \n \n \n \n \n \n \n\n101.CAL\n \nInline\nXBRL Taxonomy Extension Calculation Linkbase Document\n \n \n \n \n \n \n \n \n\n \n \n \n \n \n \n \n \n \n \n \n\n101.DEF\n \nInline\nXBRL Taxonomy Extension Definition Linkbase Document\n \n \n \n \n \n \n \n \n\n \n \n \n \n \n \n \n \n \n \n \n\n101.LAB\n \nInline\nXBRL Taxonomy Extension Labels Linkbase Document\n \n \n \n \n \n \n \n \n\n \n \n \n \n \n \n \n \n \n \n \n\n101.PRE\n \nInline\nXBRL Taxonomy Extension Presentation Linkbase Document\n \n \n \n \n \n \n \n \n\n \n \n \n \n \n \n \n \n \n \n \n\n104\n \nCover\nPage Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)\n \n \n \n \n \n \n \n \n\n \n\n+\nIndicates a management contract or compensatory plan or arrangement.\n\n*\nFiled herewith\n\n**\nFurnished herewith.\n\n \n\n63\n\n \n\n \n\n**SIGNATURES**\n\n \n\nPursuant\nto the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this annual\nreport on Form 10-K to be signed on its behalf by the undersigned thereunto duly authorized.\n\n \n\n \n**PERFECT\nMOMENT LTD.**\n\n \n \n \n\nDate:\nJune 29, 2026\nBy:\n*/s/\nJane Gottschalk*\n\n \n \nJane\nGottschalk\n\n \n \nPresident,\nChief Creative Officer and Director\n\n \n \n(Principal\nExecutive Officer)\n\n \n \n \n\nDate:\nJune 29, 2026\nBy:\n*/s/\nChath Weerasinghe*\n\n \n \nChath\nWeerasinghe\n\n \n \nChief\nFinancial Officer\n\n \n \n(Principal\nFinancial and Accounting Officer)\n\n \n\nPursuant\nto the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the\nregistrant and in the capacities and on the dates indicated.\n\n \n\nDate: June 29, 2026\nBy:\n*/s/\nJane Gottschalk*\n\n \n \nJane Gottschalk\n\n \n \nPresident, Chief Creative\nOfficer and Director\n\n \n \n(Principal Executive Officer)\n\n \n \n \n\nDate: June 29, 2026\nBy:\n*/s/ Chath\nWeerasinghe*\n\n \n \nChath Weerasinghe\n\n \n \nChief Financial Officer\n\n \n \n(Principal Financial and Accounting Officer)\n\n \n \n \n\nDate: June 29, 2026\nBy:\n*/s/ Andre\nKeijsers*\n\n \n \nAndre Keijsers\n\n \n \nDirector\n\n \n \n \n\nDate: June 29, 2026\nBy:\n*/s/ Max Gottschalk*\n\n \n \nMax Gottschalk\n\n \n \nDirector\n\n \n\n64\n\n** **"}