{"url_path":"/sec/sund/10-k/2026/item-8","section_key":"item-8","section_title":"Item 8 Financial Statements and Supplementary Data**","topic":"sec","document":{"doc_type":"10-K","doc_date":"2026-06-29","source_url":"https://www.sec.gov/Archives/edgar/data/1171838/0001493152-26-031046-index.html","accession_number":"0001493152-26-031046","cik":"0001171838","ticker":"SUND","issuer_name":"Sundance Strategies, Inc.","edgar_url":"https://www.sec.gov/Archives/edgar/data/1171838/0001493152-26-031046-index.html","primary_entity_key":"0001171838","primary_entity_name":"Sundance Strategies, Inc."},"word_count":6964,"has_tables":true,"body_markdown":"**Item\n8. Financial Statements and Supplementary Data**\n\n \n\n**SUNDANCE\nSTRATEGIES, INC. AND SUBSIDIARY**\n\n**INDEX\nTO AUDITED CONSOLIDATED FINANCIAL STATEMENTS**\n\n \n\n \n**Page(s)**\n\n \n \n\n[Report of Independent Registered Public Accounting Firm](#aud_001) (PCAOB ID: 3627)\nF-1\n\n \n \n\n[Consolidated Balance Sheets as of March 31, 2026, and 2025](#fin_001)\nF-2\n\n \n \n\n[Consolidated Statements of Operations for the Years Ended March 31, 2026, and 2025](#fin_002)\nF-3\n\n \n \n\n[Consolidated Statements of Stockholders’ Deficit for the Years Ended March 31, 2026, and 2025](#fin_003)\nF-4\n\n \n \n\n[Consolidated Statements of Cash Flows for the Years Ended March 31, 2026, and 2025](#fin_004)\nF-5\n\n \n \n\n[Notes to the Consolidated Financial Statements](#fin_005)\nF-6\n\n \n\n29\n\n \n\n \n\n**REPORT\nOF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**\n\n \n\nTo\nthe Shareholders and the Board of Directors of Sundance Strategies, Inc.:\n\n \n\nOpinion\non the Financial Statements\n\n \n\nWe have audited the accompanying consolidated balance sheets of Sundance\nStrategies, Inc. and Subsidiary (“the Company”) as of March 31, 2026 and 2025, the related consolidated statements of operations,\nstockholders’ deficit, and cash flows for each of the years in the two-year period ended March 31, 2026 and the related notes (collectively\nreferred to as the “financial statements”). In our opinion, the financial statements referred to above present fairly, in\nall material respects, the financial position of the Company as of March 31, 2026 and 2025, and the results of its operations and its\ncash flows for each of the years in the two-year period ended March 31, 2026, in conformity with accounting principles generally accepted\nin the United States of America.\n\n \n\nBasis\nfor Opinion\n\n \n\nThese financial statements are the responsibility of the Company’s\nmanagement. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public\naccounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to\nbe independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations\nof the Securities and Exchange Commission and the PCAOB.\n\n \n\nWe conducted our audits in accordance with the standards of the PCAOB.\nThose standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free\nof material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit\nof its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control\nover financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control\nover financial reporting. Accordingly, we express no such opinion.\n\n \n\nOur audits included performing procedures to assess the risks of material\nmisstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures\nincluded examining on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included\nevaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation\nof the financial statements. We believe that our audits provide a reasonable basis for our opinion.\n\n \n\nCritical\nAudit Matters\n\n \n\nCritical audit matters are matters arising from the current period audit\nof the financial statements that were communicated or required to be communicated to the board of directors and that (1) relate to accounts\nor disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.\nWe determined that there were no critical audit matters.\n\n \n\n*/s/\nSadler, Gibb & Associates, LLC*\n \n\n \n \n\nWe\nhave served as the Company’s auditor since 2018.\n \n\n \n \n\nDraper,\nUT\n \n\n \n \n\nJune\n29, 2026\n \n\n \n\nF-1\n\n \n\n \n\n**SUNDANCE\nSTRATEGIES, INC. AND SUBSIDIARY**\n\n**Consolidated\nBalance Sheets**\n\n \n\n  \nMarch 31,  \nMarch 31, \n\n  \n2026  \n2025 \n\n  \n   \n  \n\nASSETS \n    \n   \n\n  \n    \n   \n\nCurrent Assets \n    \n   \n\nCash and cash equivalents \n$32,035  \n$168,648 \n\nPrepaid expenses and other assets \n 9,449  \n 9,555 \n\n  \n    \n   \n\nTotal Current Assets \n 41,484  \n 178,203 \n\n  \n    \n   \n\nTotal Assets \n$41,484  \n$178,203 \n\n  \n    \n   \n\nLIABILITIES AND STOCKHOLDERS’ DEFICIT \n    \n   \n\n  \n    \n   \n\nCurrent Liabilities \n    \n   \n\nAccounts payable \n$451,372  \n$446,885 \n\nAccrued expenses \n 342,518  \n 880,073 \n\nCurrent portion of notes payable \n 245,000  \n 300,000 \n\nCurrent portion of notes payable, related parties \n -  \n 826,000 \n\nCurrent portion of notes payable \n -  \n 826,000 \n\nStock repurchase payable \n 400,000  \n 400,000 \n\nTotal Current Liabilities \n 1,438,890  \n 2,852,958 \n\n  \n    \n   \n\nLong-Term Liabilities \n    \n   \n\nAccrued expenses \n 2,127,869  \n 1,164,295 \n\nNotes payable \n 300,000  \n - \n\nNotes payable, related parties, net of current portion \n 3,298,747  \n 2,464,058 \n\nNotes payable, net of current portion \n 3,298,747  \n 2,464,058 \n\n  \n    \n   \n\nTotal Long-Term Liabilities \n 5,726,616  \n 3,628,353 \n\n  \n    \n   \n\nTotal Liabilities \n 7,165,506  \n 6,481,311 \n\n  \n    \n   \n\nStockholders’ Deficit \n    \n   \n\nPreferred stock, authorized 10,000,000 shares, par value $0.001; -0- shares issued and outstanding \n -  \n - \n\nCommon stock, authorized 500,000,000 shares, par value $0.001; 43,063,441 shares issued and outstanding as of March, 31 2026; and March, 31 2025 \n 43,064  \n 43,064 \n\nAdditional paid-in capital \n 33,147,126  \n 32,154,076 \n\nAccumulated deficit \n (40,314,212) \n (38,500,248)\n\n  \n    \n   \n\nTotal Stockholders’ Deficit \n (7,124,022) \n (6,303,108)\n\n  \n    \n   \n\nTotal Liabilities and Stockholders’ Deficit \n$41,484  \n$178,203 \n\n \n\nThe\naccompanying notes are an integral part of these consolidated financial statements.\n\n \n\nF-2\n\n \n\n \n\n**SUNDANCE\nSTRATEGIES, INC. AND SUBSIDIARY**\n\n**Consolidated\nStatements of Operations**\n\n \n\n  \n2026  \n2025 \n\n  \nYears Ended March 31, \n\n  \n2026  \n2025 \n\n  \n   \n  \n\nRevenue \n$-  \n$- \n\n  \n    \n   \n\nGeneral and Administrative Expenses \n 435,910  \n 604,167 \n\n  \n    \n   \n\nLoss from Operations \n (435,910) \n (604,167)\n\n  \n    \n   \n\nOther Expenses \n    \n   \n\nLoss on extinguishment of debt \n (989,968) \n (435,199)\n\nInterest expense \n (372,886) \n (349,016)\n\nFinancing expense \n (15,000) \n (215,000)\n\n  \n    \n   \n\nTotal Other Expenses \n (1,377,854) \n (999,215)\n\n  \n    \n   \n\nLoss Before Income Taxes \n (1,813,764) \n (1,603,382)\n\nIncome Tax Provision \n 200  \n - \n\n  \n    \n   \n\nNet Loss \n$(1,813,964) \n$(1,603,382)\n\n  \n    \n   \n\nLoss per share: \n    \n   \n\nLoss per share - basic and diluted \n$(0.04) \n$(0.04)\n\n  \n    \n   \n\nWeighted average shares outstanding - basic and diluted \n 42,863,742  \n 42,863,742 \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**SUNDANCE\nSTRATEGIES, INC. AND SUBSIDIARY**\n\n**Consolidated\nStatements of Stockholders’ Deficit**\n\n** **\n\n  \n   \n   \nAdditional  \n   \nTotal \n\n  \nCommon Stock  \nPaid-In  \nAccumulated  \nStockholders’ \n\n  \nShares  \nAmount  \nCapital  \nDeficit  \nDeficit \n\n  \n   \n   \n   \n   \n  \n\nBalance, March 31, 2024 \n 42,258,441  \n$42,259  \n$30,914,682  \n$(36,896,866) \n$     (5,939,925)\n\n  \n    \n    \n    \n    \n   \n\nCommon stock and warrants issued for cash \n 805,000  \n 805  \n 804,195  \n -  \n 805,000 \n\n  \n    \n    \n    \n    \n   \n\nWarrants issued in connection to extinguishment of debt \n -  \n -  \n 435,199  \n -  \n 435,199 \n\n  \n    \n    \n    \n    \n   \n\nNet loss \n -  \n -  \n -  \n (1,603,382) \n (1,603,382)\n\n  \n    \n    \n    \n    \n   \n\nBalance, March 31, 2025 \n 43,063,441  \n$43,064  \n$32,154,076  \n$(38,500,248) \n$(6,303,108)\n\nBalance \n 43,063,441  \n$43,064  \n$32,154,076  \n$(38,500,248) \n$(6,303,108)\n\n  \n    \n    \n    \n    \n   \n\nWarrants issued in connection with debt issuances \n -  \n -  \n 3,082  \n -  \n 3,082 \n\n  \n    \n    \n    \n    \n   \n\nWarrants issued in connection to extinguishment of debt \n -  \n -  \n 989,968  \n -  \n 989,968 \n\n  \n    \n    \n    \n    \n   \n\nNet loss \n -  \n -  \n -  \n (1,813,964) \n (1,813,964)\n\n  \n    \n    \n    \n    \n   \n\nBalance, March 31, 2026 \n 43,063,441  \n$43,064  \n$33,147,126  \n$(40,314,212) \n$(7,124,022)\n\nBalance \n 43,063,441  \n$43,064  \n$33,147,126  \n$(40,314,212) \n$(7,124,022)\n\n \n\nThe\naccompanying notes are an integral part of these consolidated financial statements.\n\n \n\nF-4\n\n \n\n \n\n**SUNDANCE\nSTRATEGIES, INC. AND SUBSIDIARY**\n\n**Consolidated\nStatements of Cash Flows**\n\n \n\n  \n2026  \n2025 \n\n  \nYears Ended March 31, \n\n  \n2026  \n2025 \n\n  \n   \n  \n\nOperating Activities \n    \n   \n\n  \n    \n   \n\nNet Loss \n$(1,813,964) \n$(1,603,382)\n\nAdjustments to reconcile net loss to net cash used in operating activities: \n    \n   \n\nLoss on extinguishment of debt \n 989,968  \n 435,199 \n\nAmortization of debt discount \n 3,082  \n - \n\nChanges in operating assets and liabilities \n    \n   \n\nPrepaid expenses and other assets \n 106  \n (480)\n\nAccounts payable \n 4,487  \n (977)\n\nAccrued expenses \n 426,019  \n 253,428 \n\n  \n    \n   \n\nNet Cash used in Operating Activities \n (390,302) \n (916,212)\n\n  \n    \n   \n\nFinancing Activities \n    \n   \n\n  \n    \n   \n\nProceeds from issuance of common stock and warrants \n -  \n 805,000 \n\nProceeds from issuance of notes payable \n 245,000  \n - \n\nProceeds from issuance of notes payable, related party \n 8,689  \n - \n\nRepayment of notes payable, related party \n -  \n (50,000)\n\n  \n    \n   \n\nNet Cash provided by Financing Activities \n 253,689  \n 755,000 \n\n  \n    \n   \n\nNet Change in Cash and Cash Equivalents \n (136,613) \n (161,212)\n\nCash and Cash Equivalents at Beginning of Period \n 168,648  \n 329,860 \n\n  \n    \n   \n\nCash and Cash Equivalents at End of Period \n$32,035  \n$168,648 \n\n  \n    \n   \n\nSupplemental disclosure of cash flow information: \n    \n   \n\nCash paid for interest \n$-  \n$150,000 \n\nCash paid for income taxes \n$200  \n$- \n\nNon Cash Financing & Investing Activities, and Other Disclosures \n    \n   \n\nWarrants issued in connection with debt issuances \n$3,082  \n$- \n\n \n\nThe\naccompanying notes are an integral part of these audited consolidated financial statements.\n\n \n\nF-5\n\n \n\n \n\n**SUNDANCE\nSTRATEGIES, INC. AND SUBSIDIARY**\n\n**NOTES\nTO CONSOLIDATED FINANCIAL STATEMENTS**\n\n**March\n31, 2026, and 2025**\n\n \n\n**(1)\nORGANIZATION**\n\n \n\nSundance\nStrategies, Inc. (formerly known as Java Express, Inc.) was organized under the laws of the State of Nevada on December 14, 2001, and\nengaged in the retail selling of beverage products to the general public until these endeavors ceased in 2006; it had no material business\noperations from 2006, until its acquisition of ANEW LIFE, INC. (“ANEW LIFE”), a subsidiary of Sundance Strategies, Inc. (“Sundance\nStrategies”, “the Company”, “we” or “our”).\n\n \n\nOur\nhistorical business model has focused on purchasing or acquiring life insurance policies and residual interests in or financial products\ntied to life insurance policies, including notes, drafts, acceptances, open accounts receivable and other obligations representing part\nor all of the sales price of insurance, life settlements and related insurance contracts being traded in the secondary marketplace, often\nreferred to as the “life settlements market.”\n\n \n\nDuring\nthe latter part of the fiscal year ended March 31, 2021, we began developing an additional business offering, providing professional\nservices to specialty structured finance groups, bond issuers and life settlement aggregators. We have assembled an experienced team\nfrom the life settlement marketplace, as well as from other areas such as financial services and public financial markets. As a professional\nservices provider, we apply industry best practices to advise on the selection of specific portfolios of life insurance policies that\nare tailored to meet the needs of its clients. Our clients may include bond issuers, bond investors, or other structured finance product\nissuers. We develop strategies and methodologies which include the acquisition of life insurance portfolios, then use common structured\nfinance techniques and proprietary analytics to structure bonds for issuances, including principal protected bonds. Our goal is to deliver\nlong-term value and profitability to shareholders by growing our professional services business and asset base, resulting in the ability\nto pay dividends to its shareholders.\n\n \n\nDuring\nthe latter part of the year ended March 31, 2021, we began working closely with bond placement agents and aggregators to establish various\naspects of a proprietary, investment grade bond offering. In this arrangement, we participate as the sole originator in the role of structuring\nand advising on the structure of the proprietary bond instrument. Included in the role of structuring financial assets, we use proprietary\nanalytics to establish the makeup of the rated instrument, including but not limited to life settlement assets (life insurance policies)\nand managed cash, and implement a process of selective assembly of the underlying assets and cash management that will meet the policy\nrequirements and analytics. We provide current and ongoing resources for all analytics, as well as advisement support for the investment\nand non-investment grade ratings for the managed asset pool and the managed cash accounts. In our advisory role, we are reimbursed for\nall expenses associated with the structuring and preparation of any bond offering, will receive an advisory payment upon the closing\nof any bond offering, and then will hold residual rights on the balance of assets once the bond is retired.\n\n** **\n\n**(2)\nSUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**\n\n \n\n*Estimates,*The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America\nrequires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent\nassets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting\nperiod. Actual results could differ from those estimates.\n\n \n\n*Cash\nand Cash Equivalents,*For purposes of reporting cash flows, the Company considers all highly-liquid debt instruments purchased with\nan original maturity of three months or less to be cash equivalents.\n\n \n\n*Basic\nand Diluted Net Loss Per Common Share,*Basic net loss per common share is computed by dividing net loss by the weighted average number\nof common shares outstanding during the periods presented using the treasury stock method. Diluted net loss per common share is computed\nby including common shares that may be issued subject to existing rights with dilutive potential, when applicable. Potential dilutive\ncommon stock equivalents are primarily comprised of potential dilutive shares resulting from convertible debt agreements and common stock\nwarrants. Potentially dilutive shares resulting from convertible debt agreements are evaluated using the if-converted method. Potentially\ndilutive securities are not included in the calculation of diluted net loss per share for the years ended March 31, 2026, and 2025, because\nto do so would be anti-dilutive. Potentially dilutive securities outstanding as of March 31, 2026, and 2025, include warrants convertible\ninto 18,245,002 and 14,496,123 shares of common stock, respectively.\n\n \n\nF-6\n\n \n\n \n\n*Stock-Based\nCompensation and Financing Costs*, The Company measures stock-based compensation expense related to employee stock-based awards and\nstock-based expense associated with certain financing costs on the estimated fair value of the awards as determined on the date of grant\nand is recognized as expense over the remaining requisite service period for options and vesting period for warrants. The Company utilizes\nthe Black-Scholes pricing model to estimate the fair value of stock options issued as compensation and warrants issued as financing costs.\nThe Black-Scholes model requires the input of highly subjective and complex assumptions, including the estimated fair value of the Company’s\ncommon stock on the date of grant, the expected term of the stock option and warrant, and the expected volatility of the Company’s\ncommon stock over the period equal to the expected term of the grant. The Company estimates forfeitures at the date of grant and revises\nthe estimates, if necessary, in subsequent periods if actual forfeitures differ from those estimates.\n\n \n\n*Income\nTaxes,*The Company accounts for income taxes under FASB ASC 740, “Income Taxes”. Deferred income tax assets and liabilities\nare determined based upon differences between the financial reporting and tax basis of assets and liabilities and are measured using\nthe enacted tax rates and laws that will be in effect when the differences are expected to reverse. Accounting standards require the\nconsideration of a valuation allowance for deferred tax assets if it is “more likely than not” that some component or all\nof the benefits of deferred tax assets will not be realized.\n\n \n\nThe\ntax effects from an uncertain tax position can be recognized in the financial statements only if the position is more likely than not\nto be sustained if the position were to be challenged by a taxing authority. The Company has examined the tax positions taken in its\ntax returns and determined that there are no uncertain tax positions. As a result, the Company has recorded no uncertain tax liabilities\non its balance sheet. Interest and penalties for uncertain positions, when applicable, would be recognized as a component of income tax\nexpense.\n\n \n\nThe\nCompany files United States Federal and State income tax returns. The income tax returns of the Company are subject to examination by\ntaxing authorities for three to five years from the date they are filed. The Company has tax returns subject to examination for 2018-2023.\n\n \n\n*Principles\nof Consolidation,*The consolidated financial statements include the accounts of the Company and its subsidiary. The subsidiary is\nwholly owned. All intercompany accounts and transactions are eliminated in consolidation.\n\n \n\n*Fair\nValue,* As defined by ASC Topic 820, “Fair Value Measurements and Disclosures” (“ASC 820”), fair value is\nthe price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants\nat the measurement date. ASC 820 also requires the consideration of differing levels of inputs in the determination of fair values.\n\n \n\nThose\nlevels of input are summarized as follows:\n\n \n\n●\nLevel 1: Quoted prices in active markets for identical assets and liabilities.\n\n \n\n●\nLevel 2: Observable inputs other than Level 1 quoted prices, such as quoted prices for similar instruments in active markets, quoted\nprices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant\nassumptions are observable in the market.\n\n \n\n●\nLevel 3: Unobservable inputs that are supported by little or no market activity. Level 3 assets and liabilities include financial instruments\nwhose value is determined using pricing models, discounted cash flow methodologies, or similar techniques as well as instruments for\nwhich the determination of fair value requires significant management judgment or estimation.\n\n \n\nF-7\n\n \n\n \n\nThe\nlevel in the fair value hierarchy within which a fair value measurement in its entirety falls is based on the lowest level input that\nis significant to the fair value measurement in its entirety.\n\n \n\nThe\nCompany did not have any transfers of assets and liabilities between Levels 1, 2 and 3 of the fair value measurement hierarchy during\nthe years ended March 31, 2026, and 2025.\n\n \n\nThe\nCompany’s recorded values of cash and cash equivalents, accounts payable and accrued liabilities approximate their fair values\nbased on their short-term nature. The recorded values of the Notes Payable, Related Parties and Convertible Debenture approximates the\nfair values as the interest rate approximates market interest rates.\n\n \n\n**(3)\nNEW ACCOUNTING PRONOUNCEMENTS**\n\n \n\nThe\nCompany has reviewed all other recently issued, but not yet adopted, accounting standards, in order to determine their effects, if any,\non its results of operations, financial position or cash flows. Based on that review, the Company believes that none of these pronouncements\nwill have a significant effect on its financial statements.\n\n \n\n**(4)\nCASH AND CASH EQUIVALENTS**\n\n \n\nCash\nand cash equivalents consist principally of currency on hand and demand deposits at commercial banks. The Company had $32,035and $168,648\nin cash and cash equivalents as of March 31, 2026, and 2025, respectively. The Company maintains non-interest-bearing accounts at two\nfinancial institutions. The accounts at these institutions are insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000.\nAs of March 31, 2026, and 2025, the Company did not have balances in excess of FDIC insured amounts at these institutions.\n\n \n\n**(5)\nNOTES PAYABLE**\n\n \n\nOn\nApril 6, 2021, the Company borrowed $300,000 under an unsecured promissory note with Satco International, Ltd. This promissory note bears\ninterest at a rate of 8% annually and was due January 6, 2022. In conjunction with this note, the Company issued warrants for 1,000,000\nshares of common stock, exercisable at $1.00 per share and expiring in 3 years from the date of the promissory note. Subsequent to year\nend, on June 5, 2026, the unsecured promissory note with Satco International, Ltd. was amended to extend the due date from August 31,\n2026, to August 31, 2027, or at the immediate time when alternative financing or other proceeds are received (see note 11). This extension\nhas no bearing on the warrants that were issued in conjunction with the original promissory note. The warrants associated with this unsecured\npromissory note expired without being exercised on April 6, 2024. This note is separate from the 8% convertible debenture agreement that\nthe Company has in place with Satco International, Ltd. (see note 7). As of March 31, 2026, accrued interest on the note totaled $119,671.\n\n \n\nOn\nSeptember 30, 2025, the Company executed an unsecured promissory note with a shareholder. This promissory note bears interest at a rate\nof 7.5% annually, is due September 30, 2026, functions as a line of credit, and has a credit limit of $300,000. As of March 31, 2026,\nthe Company has borrowed $245,000, and accrued interest on the note totaled $6,512.\n\n \n\n**(6)\nNOTES PAYABLE, RELATED PARTY**\n\n \n\nAs\nof March 31, 2026, and 2025, the Company had borrowed $3,298,747 and $3,290,058 respectively, excluding accrued interest, from related\nparties. There was no unamortized debt discount with the Notes Payable, Related party as of March 31, 2026, or March 31, 2025. Short-term\naccrued interest associated with the Notes Payable, Related Party of $0 and $504,608 is recorded on the balance sheet as an Accrued Expense\nobligation at March 31, 2026, and March 31, 2025, respectively. Long-term accrued interest associated with the Notes Payable, Related\nParty of $1,883,971 and $1,040,070 is recorded on the balance sheet as an Accrued Expense obligation at March 31, 2026, and March 31,\n2025, respectively.\n\n \n\nF-8\n\n \n\n \n\n**Related\nParty Promissory Notes**\n\n \n\nAs\nof both March 31, 2026, and 2025, the Company owed $826,000 under the unsecured promissory notes from Mr. Dickman. The promissory notes\nbear interest at a rate of 8% annually. On January 14, 2026, the notes were amended to extend the due date from November 30, 2025 to\nApril 30, 2027, or at the immediate time when alternative financing or other proceeds are received. As per the provision outlined in\nNote 8, the company agreed to provide Mr. Dickman with warrants for 1,166,000 shares of common stock (see Note 8) vested immediately\nupon issuance, having exercise prices of $0.41 per share, and a 5-year exercise window from the dates of issuance. During the years ended\nMarch 31, 2026, and March 31, 2025, the Company neither borrowed any additional funds under this agreement nor made any principal repayments.\nAs of March 31, 2026, and 2025, accrued interest on the notes totaled $613,595, and $504,608, respectively. In the event the Company\ncompletes a successful equity raise all principal and interest on the notes are due in full at that time. The total number of warrants\nissued to the related party lender as of March 31, 2026 is 3,160,332 (see Note 8 for further details on these warrants).\n\n \n\nOn\nJuly 29, 2021, the Company entered into an unsecured promissory note agreement with Radiant Life, LLC. This agreement was in conjunction\nwith the Company borrowing $50,000 of Notes Payable, Related Party, and is not part of the existing note payable and lines of credit\nagreement the Company has with Radiant Life, LLC. The promissory note bore interest at a rate of 8% annually and was due on July 29,\n2024. In conjunction with this specific loan event, the agreement awarded Radiant Life, LLC with 50,000 common stock warrants, which\nhad an exercise price of $1.05, and expired in 5 years (see Note 8). The principal and accrued interest of $13,172 was fully paid on\nJuly 2, 2024, and immediately closed.\n\n \n\n**Related\nParty Note Payable and Line of Credit Agreements**\n\n \n\nAs\nof March 31, 2026, and 2025, the Company owed $1,304,550, exclusive of accrued interest, under the note payable and line of credit agreement\nwith Kraig T. Higginson, Chairman of the Board of Directors and a stockholder. On January 24, 2025, and again on January 08, 2026 the\nrelated party note payable and line of credit agreement was amended to extend the due date from November 30, 2025, to November 30, 2026,\nand then to May 31, 2028, or at the immediate time when alternative financing or other proceeds are received. As of March 31, 2026, the\nagreement allowed for borrowings of up to $4,600,000. During the years ended March 31, 2026, and 2025, the Company made no borrowings\nnor repayments of principal on this agreement. The note payable and line of credit agreement incurs interest at 7.5% per annum. As of\nMarch 31, 2026, and 2025, accrued interest on this note totaled $599,043, and $501,202, respectively. As per the provision outlined in\nNote 8, and in conjunction with the extension on January 24, 2025, the company agreed to provide the Chairman of the Board of Directors\nand a stockholder, with warrants for 1,544,550 shares of common stock (see Note 8) vested immediately upon issuance, having exercise\nprices of $0.41 per share, and a 5-year exercise window from the dates of issuance. As per the provision outlined in Note 8, and in conjunction\nwith the extension on January 08, 2026, the company agreed to provide the Chairman of the Board of Directors and a stockholder, with\nwarrants for 1,664,550 shares of common stock (see Note 8) vested immediately upon issuance, having exercise prices of $0.41 per share,\nand a 5-year exercise window from the dates of issuance. The total number of warrants issued to the related party lender as of March\n31, 2026 is 5,920,325 (see Note 8 for further details on these warrants).\n\n \n\nAs\nof March 31, 2026, and 2025, the Company owed $1,168,197\nand $1,159,508\nrespectively in principal, under the note payable and lines of credit agreement with Radiant Life, LLC. The agreement allows for\nborrowings of up to $2,130,000.\nThrough a series of extensions subsequent to the March 31, 2026, fiscal year end, the related party note payable and line of credit\nagreement was amended to extend the due date from November 30, 2026, to May 31, 2027, or at the immediate time when alternative\nfinancing or other proceeds are received. The note payable and line of credit agreement incurs interest at 7.5%\nper annum. During the years ended March 31, 2026, and 2025 the Company borrowed $8,689\nand $0,\nrespectively of principal under this agreement and made no repayments of principal. As of March 31, 2026, and 2025, accrued interest\non this agreement totaled $671,333,\nand $538,868,\nrespectively. As per the provision outlined in Note 8, and in conjunction with the extension on May 1, 2025, the Company also\nagreed to provide Radiant Life, LLC with warrants for 1,399,508\nshares of common stock vested immediately upon issuance, having an exercise price of $0.41,\nand a 5-year\nexercise window from the dates of issuance. As per the provision outlined in Note 8, and in conjunction with the extension on\nJanuary 14, 2026, the Company also agreed to provide Radiant Life, LLC with warrants for 1,288,197\nshares of common stock vested immediately upon issuance, having an exercise price of $0.41,\nand a 5-year\nexercise window from the dates of issuance The total number of warrants issued to the related party lender was 5,354,345\nas of March 31, 2026 (see Note 8 for further details).\n\n \n\nF-9\n\n \n\n \n\n**(7)\nCONVERTIBLE DEBENTURE AGREEMENT**\n\n \n\nThe\nCompany has entered into an 8% convertible debenture agreement with Satco International, Ltd., that allows for borrowings of up to $3,000,000.\nThe holder originally had the option to convert the outstanding principal and accrued interest to unregistered, restricted common stock\nof the Company on June 2, 2016. Per the agreement, the number of shares issuable at conversion shall be determined by the quotient obtained\nby dividing the outstanding principal and accrued and unpaid interest by 90% of the 90-day average closing price of the Company’s\ncommon stock from the date the notice of conversion is received; and the price at which the Debenture may be converted will be no lower\nthan $1.00 per share. The original maturity date was June 2, 2016, but was later extended, through a series of extensions, to August\n31, 2027 (see note 11), or at the immediate time when alternative financing or other proceeds are received. This extension has no bearing\non the warrants that were issued in conjunction with the original promissory note.\n\n \n\nAs\nof March 31, 2026 and March 31, 2025, the Company owed $0 under the agreement, excluding accrued interest. The associated interest of\n$124,225 is recorded on the balance sheet as an Accrued Expense obligation at March 31, 2026, and 2025.\n\n \n\n**(8)\nSTOCKHOLDERS’ EQUITY**\n\n \n\n**Common\nStock**\n\n \n\nOn\nAugust 15, 2023, the Company issued a private placement memorandum offering to raise up to $1,500,000\nthrough the issuance of restricted shares of the Company’s\ncommon stock (par value $0.001)\nto qualified investors. From June 18, 2024, to July 10, 2024, the Company received subscription agreements from investors, for 805,000\ncommon shares at a purchase price of $1\nper share, including 1,610,000\nwarrants exercisable at $0.35\nper share, vested immediately upon issuance, with a 5\nfive-year expiration. Proceeds to the company\ntotaled $805,000.\n\n \n\nEffective\nDecember 6, 2018, three existing stockholders have contributed to the Company a portion of their common shares held at a repurchase price\nto the Company of $0.05 per share. The Company has cancelled the acquired shares, which decreased the outstanding common shares on the\nbooks of the Company. The total number of common shares canceled/retired was 8,000,000. The total liability related to the repurchase\nof these shares is $400,000, with repayment contingent on a major financing event.\n\n \n\n**Warrants\nto Purchase Common Stock**\n\n \n\nThe\nfollowing table summarizes the changes in warrants outstanding of the Company during years ended March 31, 2026, and 2025:\n\n SCHEDULE OF WARRANT OUTSTANDING\n\n  \nNumber of\n\nWarrants  \nWeighted Average\n\nExercise Price ($) \n\nOutstanding at March 31, 2024 \n 14,043,573  \n 0.75 \n\nGranted \n 3,154,550  \n 0.38 \n\nReductions \n (2,702,000) \n 0.40 \n\nOutstanding at March 31, 2025 \n 14,496,123  \n 0.73 \n\nGranted \n 5,535,633  \n 0.41 \n\nReductions \n (1,786,754) \n 0.05 \n\nOutstanding at March 31, 2026 \n 18,245,002  \n 0.70 \n\n \n\nF-10\n\n \n\n \n\nThe\nCompany’s related party lenders consist of: the Chairman of the Board of Directors and a stockholder, Radiant Life, LLC and Mr.\nDickman, a board member and stockholder. These holders of the related party unsecured promissory notes hold agreements that provide each\nrelated party with common stock warrants upon the lender’s extension of a maturity due date or upon the loaning of additional monies.\nThe number of warrants issued for an extension is based on the following formula for borrowings occurring on or before March 31, 2024:\n10,000 warrants per month the due date is extended plus one warrant for every $2 of the principal balance outstanding (not including\ninterest) at the time of the extension (rounded to the nearest whole warrant). For borrowings occurring after March 31, 2024, the formula\nhas been adjusted to the following: 20,000 warrants per month the due date is extended plus one warrant for every $1 of the principal\nbalance outstanding (not including interest) at the time of the extension (rounded to the nearest whole warrant). Upon the loaning of\nadditional monies, the lenders will also require 2 warrants for each dollar loaned. All warrants issued under these terms vested immediately\nupon issuance, have an exercise price approximately equivalent to the fair value of the Company’s common stock on the date of grant,\nand expire 5 years from the date of issuance.\n\n \n\nDuring\nthe year ended March 31, 2026, the Company issued 1,664,550 warrants to the Chairman of the Board of Directors in conjunction with an\nextension of the maturity dates during the period per the terms outlined above. The exercise price of these warrants was $0.41. The value of\nthe warrants on the date of grant, as calculated by the Black-Scholes-Merton valuation model was $242,791. The inputs used in this calculation\nincluded a fair value of the underlying common stock of $0.25 per share, a risk-free of 3.74%, volatility of 81.93%, and a dividend rate\nof 0%.\n\n \n\nDuring\nthe year ended March 31, 2026, the Company issued 2,687,705 warrants to Radiant Life, LLC in conjunction with an extension of the maturity\ndates during the period per the terms outlined above. The exercise price of these warrants was $0.41. The value of the warrants on the date\nof grant, as calculated by the Black-Scholes-Merton valuation model was $576,773. The inputs used in this calculation included a fair\nvalue of the underlying common stock between $0.25 and $0.409 per share, a risk-free between 3.72% and 3.81%, volatility between 82.13\nand 82.79%, and a dividend rate of 0%.\n\n \n\nDuring\nthe year ended March 31, 2026, the Company issued 1,166,000 warrants to Mr. Dickman in conjunction with an extension of the maturity\ndates during the period per the terms outlined above. The exercise price of these warrants was $0.41. The value of the warrants on the date\nof grant, as calculated by the Black-Scholes-Merton valuation model was $170,404. The inputs used in this calculation included a fair\nvalue of the underlying common stock of $0.25 per share, a risk-free of 3.72%, volatility of 82.13%, and a dividend rate of 0%.\n\n \n\nDuring\nthe year ended March 31, 2026, the Company issued 17,378 warrants to Radiant Life, LLC in conjunction with monies borrowed during the period (see Note 6)\nper the terms outlined above. The exercise price of these warrants was $0.41. The value of the warrants on the date of grant, as calculated\nby the Black-Scholes-Merton valuation model was $4,777. The inputs used in this calculation included a fair value of the underlying common\nstock of $0.409 per share, a risk-free of 3.78%, volatility of 81.58% and a dividend rate of 0%.\n\n \n\nDuring\nthe year ended March 31, 2025, the Company issued 1,544,550 warrants to the Chairman of the Board of Directors in conjunction with an\nextension of the maturity dates during the period per the terms outlined above. The exercise price of these warrants was $0.41. The value of\nthe warrants on the date of grant, as calculated by the Black-Scholes-Merton valuation model was $435,199. The inputs used in this calculation\nincluded a fair value of the underlying common stock of $0.409 per share, a risk-free of 4.43%, volatility of 83.74%, and a dividend\nrate of 0%.\n\n \n\nF-11\n\n \n\n \n\nThe\nfollowing table summarizes the warrants issued and outstanding as of March 31, 2026:\n\n SCHEDULE OF WARRANTS ISSUED AND OUTSTANDING\n\nExercise\n\nPrice ($)  \nWarrants Outstanding  \nWarrants Exercisable  \nWeighted Average\n\nRemaining\n\nContractual Life\n\n(Years)  \nProceeds to Company if Exercised \n\n   \n   \n   \n   \n  \n\n 0.05  \n 220,000  \n 220,000  \n 0.46  \n$11,000 \n\n 0.35  \n 3,310,000  \n 3,310,000  \n 2.87  \n 1,158,500 \n\n 0.41  \n 9,115,212  \n 9,115,212  \n 4.08  \n 3,737,237 \n\n 1.05  \n 5,049,790  \n 5,049,790  \n 1.48  \n 5,302,280 \n\n 2.00  \n 50,000  \n 50,000  \n 0.34  \n 100,000 \n\n 5.00  \n 500,000  \n 500,000  \n 0.82  \n 2,500,000 \n\n    \n 18,245,002  \n 18,245,002  \n    \n$12,809,017 \n\n \n\nThe\nshares of common stock issuable upon exercise of the warrants are not registered with the Securities and Exchange Commission and the\nholders of the warrants do not have registration rights with respect to the warrants or the underlying shares of common stock.\n\n \n\n**(9)\nLIQUIDITY REQUIREMENTS AND GOING CONCERN**\n\n \n\nSince\n2013 the Company’s operations have been primarily financed through sales of equity, debt financing from related parties and the\nissuance of notes payable and convertible debentures. As of March 31, 2026, the Company had $32,035 of cash assets, compared to $168,648\nas of March 31, 2025. As of March 31, 2026, the Company had access to draw an additional $4,257,253 on the notes payable, related party\n(see Note 6) and $3,000,000 on the Convertible Debenture Agreement (see Note 7). For the year ended March 31, 2026, the Company’s\naverage monthly operating expenses were approximately $37,000, which includes salaries of our employees, consulting agreements and contract\nlabor, general and administrative expenses and legal and accounting expenses. In addition to the monthly operating expenses, the Company\ncontinues to pursue other debt and equity financing opportunities, and as a result, financing expenses of $15,000 and $215,000 were incurred\nduring the years ended March 31, 2026, and 2025, respectively. As management continues to explore additional financing alternatives,\nbeginning April 1, 2026, the Company is expected to spend up to an additional $300,000 on these efforts. Outstanding Accounts Payable\nas of March 31, 2026 totaled $451,372. Management has concluded that its existing capital resources and availability under its existing\nconvertible debentures and debt agreements with related parties will be sufficient to fund its operating working capital requirements\nfor the 12 months from the issuance of the financial statements. Related parties have given informal assurance of their continued support,\nby way of either extensions of due dates, or increases in lines-of-credit. As mentioned above, the Company also continues to evaluate\nother debt and equity financing opportunities.\n\n \n\nManagement evaluated the conditions and events that could affect the Company’s\nability to continue as a going concern for the one-year period following the issuance of these financial statements in accordance with\nASC 205-40. Although the Company has incurred recurring operating losses, has limited cash resources, and is dependent upon related-party\nfinancing and future capital-raising activities, management’s plans include utilizing available borrowing capacity under existing financing\narrangements, continuing to pursue additional debt and equity financing opportunities, and managing operating expenditures. Based on these\nfactors, management concluded that the conditions described above do not raise substantial doubt about the Company’s ability to continue\nas a going concern because existing cash resources and available borrowing capacity under current financing arrangements are sufficient\nto fund operations and satisfy obligations as they become due for at least one year from the issuance of these financial statements.\n\n \n\nThe\naccompanying financial statements have been prepared assuming the Company will continue as a going concern, under which assumption the\nCompany is expected to be able to realize its assets and satisfy its liabilities in the normal course of business.\n\n \n\nF-12\n\n \n\n \n\n**(10)\nINCOME TAXES**\n\n \n\nThe\nCompany provides for income taxes under ASC 740, Income Taxes. ASC 740 requires the use of an asset and liability approach in accounting\nfor income taxes. Deferred tax assets and liabilities are recorded based on the differences between the financial statement and tax bases\nof assets and liabilities and the tax rates in effect when these differences are expected to reverse.\n\n \n\nTaxes based on income were as follows:\n\n SCHEDULE OF TAX BASED INCOME\n\n \n2026  \n2025 \n\n  \nMarch 31, \n\n \n2026  \n2025 \n\nCurrent: \n    \n   \n\nU.S. federal tax \n$-  \n$- \n\nState taxes \n 200  \n - \n\nCurrent income tax expense (benefit) \n 200  \n - \n\nDeferred: \n    \n   \n\nU.S federal tax \n -  \n - \n\nStates taxes \n -  \n - \n\nDeferred income tax expense (benefit) \n$-  \n$- \n\n  \n    \n   \n\nProvision for income taxes \n$200  \n$    - \n\n \n\nDeferred taxes reflect the temporary differences between the amounts at\nwhich assets and liabilities are recorded for financial reporting purposes and the amounts utilized for tax purposes. The primary components\nof the temporary differences that gave rise to our deferred tax assets and liabilities were as follows:\n\n \n\nSCHEDULE OF DEFERRED TAX ASSETS AND LIABILITIES\n\n  \n2026  \n2025 \n\n  \nMarch 31, \n\n  \n2026  \n2025 \n\nDeferred tax assets: \n    \n   \n\nNet operating loss carryforwards \n$8,236,674  \n$8,080,869 \n\nStock and Warrant Compensation \n 1,121,648  \n 870,911 \n\nAccruals \n 72,422  \n 58,201 \n\n  \n    \n   \n\nTotal deferred tax assets \n 9,430,744  \n 9,009,981 \n\n  \n    \n   \n\nDeferred tax liabilities: \n    \n   \n\n  \n    \n   \n\nTotal deferred tax liabilities \n -  \n - \n\nLess valuation allowance \n (9,430,744) \n (9,009,981)\n\nNet deferred tax assets \n$-  \n$- \n\n \n\nF-13\n\n \n\n \n\nWe\nassess available positive and negative evidence to estimate if sufficient future taxable income is expected to be generated to use existing\ndeferred tax assets. On the basis of our assessment, we record valuation allowances for deferred tax assets that do not meet the more-likely-than-not\nrealization threshold. Our assessment of the future realizability of our deferred tax assets relies on our forecasted earnings in certain\njurisdictions determined by the manner in which we operate our business and the relevant carryforward period. As a result of all available\nevidence, the Company believes that it is more likely than not that its net deferred tax assets will not be realized and has established\na valuation allowance of $9,430,744 million and $9,009,981 million, respectively, against its net deferred tax assets as of March 31,\n2026 and March 31, 2025.\n\n \n\nU.S. federal net operating loss carryforwards at March 31, 2026 and March\n31, 2025 were $32.3 and 31.6 million, respectively. If unused, net operating loss carryforwards will expire as follows:\n\n SUMMARY OF OPERATING LOSS CARRYFORWARDS\n\n  \nNet Operating Losses \n\nYear of expiry \n   \n\nMarch 31, 2027 \n$69,191 \n\nMarch 31, 2028 \n 28,613 \n\nMarch 31, 2029 \n 9,295 \n\nMarch 31, 2030 - March 31, 2038 \n 22,744,468 \n\nIndefinite life/no expiry \n 9,466,409 \n\nTotal \n$32,317,976 \n\n \n\nState net operating loss carryforwards totaled approximately $32,317,976\nmillion at March 31, 2026. These net operating loss carryforwards may be carried forward indefinitely under current state law.\n\n \n\nThe\nprincipal items accounting for the difference between taxes computed at the U.S. federal statutory rate and taxes recorded were as follows:\n\n SCHEDULE OF FEDERAL STATUTORY TAX RATE\n\n  \nAmount  \nPercent  \nAmount  \nPercent \n\n  \nYear Ended March 31, 2026  \nYear Ended March 31, 2025 \n\n  \nAmount  \nPercent  \nAmount  \nPercent \n\nUS Federal Statutory Tax Rate \n$(380,890) \n 21.00% \n$(336,710) \n 21.00%\n\nState and Local Income Taxes, Net of Federal Income Tax Effect \n 158  \n -0.01% \n 158  \n -0.01%\n\nForeign Tax Effects \n -  \n -  \n -  \n - \n\nEffect of Changes in Tax Laws or Rates Enacted in the Current Period \n -  \n -  \n -  \n - \n\nEffect of Cross-Border Tax Laws \n -  \n -  \n -  \n - \n\nTax Credits \n -  \n -  \n -  \n - \n\nResearch and Development Tax Credits \n -  \n -  \n -  \n - \n\nChanges in Valuation Allowances \n 364,655  \n -20.10% \n 773,341  \n -48.24%\n\nNontaxable or Nondeductible Items \n    \n    \n    \n   \n\nMeals \n 10  \n 0.00% \n 19  \n 0.00%\n\nDeferred Adjustments \n 16,267  \n -0.90% \n (436,808) \n 27.24%\n\nChanges in Unrecognized Tax Benefits \n -  \n -  \n    \n - \n\nEffective Tax Rate \n$200  \n -0.01% \n$-  \n -0.01%\n\n \n\nF-14\n\n \n\n \n\nOur 2026 provision for income taxes included i) $158 state tax charge net\nof federal benefit; ii) $8,203 of tax charge for certain deferred tax adjustments; iii) $10 of tax charge related to nondeductible meals;\niv) $364,655 of tax charge from changes in valuation allowances; v) $8,064 of tax charge related to return to provision adjustments.\n\n \n\nOur\n2025 provision for income taxes included i) $158 state tax charge net of federal benefit; ii) $436,808 of tax benefit for certain deferred\ntax adjustments; iii) $19 of tax charge related to nondeductible meals; iv) 773,341 of tax charge from changes in valuation allowances.\n\n \n\nIncome/(loss) before taxes from our U.S. operations was as follows:\n\n \n\nSCHEDULE OF\nINCOME/LOSS BEFORE TAXES\n\n  \n2026  \n2025 \n\nU.S. \n$(1,813,764) \n$(1,603,382)\n\nForeign \n -  \n - \n\nIncome before taxes \n$(1,813,764) \n$(1,603,382)\n\n \n\nOur\neffective tax rate was -0.01% and -0.01% for fiscal years 2026 and 2025, respectively\n\n \n\nThe\nCompany files income tax returns in the U.S. federal and certain state jurisdictions. During the periods ended March 31, 2026, and 2025,\nthe Company has not recorded a liability for uncertain income tax positions or any related interest or penalties. As such, our unrecognized\ntax benefits for 2026 and 2025 totaled $0, respectively. With limited exceptions, we are no longer subject to income tax examinations\nby tax authorities for years prior to 2021.\n\n \n\nThe\namount of income taxes paid (net of refunds received) were as follows:\n\n \n\nSCHEDULE OF\nINCOME TAXES PAID, NET OF REFUNDS RECEIVED\n\n  \nFor the Year Ended \n\n  \nMarch 31, 2026 \n\n  \n \n\nFederal \n$- \n\nState and Local \n 200 \n\nForeign \n - \n\nTotal income taxes paid (net of refunds received) \n$200 \n\n \n\nAmounts\nrepresent taxes paid during 2026 based on the company’s tax provision. The 2026 income tax returns have not been filed.\nTherefore, the amounts are subject to change upon filing. For the years ended March 31, 2025, and 2024, gross income taxes paid were\n$0 and\n$200,\nrespectively.\n\n \n\nUnder\nFASB ASC 740-10-05-6, tax benefits are recognized only for the tax positions that are more likely than not to be sustained upon examination\nby tax authorities. The amount recognized is measured as the largest amount of benefit that is greater than 50 percent likely to be realized\nupon ultimate settlement. Unrecognized tax benefits are tax benefits claimed in the company’s tax return that do not meet these\nrecognition and measurement standards.\n\n \n\nThe\nCompany had no liabilities for unrecognized tax benefits and the Company has recorded no additional interest or penalties.\n\n \n\n**(11)\nSUBSEQUENT EVENTS**\n\n \n\nSubsequent\nto fiscal year end, the Company negotiated with Satco International Ltd to extend the due date of the notes payable and convertible debenture\nagreement to extend the due date of these notes from August 31, 2026 to August 31, 2027.\n\n** **\n\n****\n\nF-15"}