NOTE 1 – NATURE OF THE ORGANIZATION AND BUSINESS

Historical Business Operations

NaturalShrimp Incorporated (“NaturalShrimp” or the “Company”), a Nevada corporation, was a former biotechnology company that was focused on growing Pacific White shrimp (Litopenaeus vannamei, formerly Penaeus vannamei) in an ecologically controlled, high-density, low-cost environment, and in fully contained and independent production facilities.

Receivership

On September 4, 2024, Streeterville Capital, LLC, a Utah limited liability company, and Bucktown Capital, LLC, a Utah limited liability company (collectively, “Lenders”), filed a Verified Emergency Motion for Appointment of Receiver (the “Motion”) under Civil Case No. 240907138, in the District Court of Salt Lake County, Utah, against NaturalShrimp, Inc. (“NaturalShrimp”).

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

An order was entered ex parte by the Utah State Court in the Receivership Case on September 9, 2024 granting the relief requested by Lenders. The Utah State Court duly appointed Amplēo Turnaround and Restructuring, LLC (the “Receiver”) as the receiver over NaturalShrimp’s assets. The Utah State Court’s order further scheduled a hearing to be held on September 17, 2024, on a preliminary injunction to address issues raised in the Motion.

On November 20, 2024, the Lenders and NaturalShrimp filed a Verified Amended and Stipulated Emergency Motion for Immediate Appointment of a Receiver in the Receivership Case.

On November 22, 2024, the Utah State Court entered an order granting the Stipulated Motion and appointed Receiver as the receiver over the assets of NaturalShrimp. Under the Amended Receivership Order, the Receiver is the receiver over the Receivership Entities’ assets.

On February 11, 2025, the Receiver filed a Motion for Approval to Sell Substantially all of the Receivership Entities’ Assets to Streeterville Captial, LLC and Bucktown Captial, LLC (or Their Designees) or Any Other Party With a Higher and Better Offer Free and Clear of All Liens, Interests, Claims, and Encumbrances (the “Sale Motion”) in the Receivership Case. The Sale Motion sought the Utah State Court’s approval for the Receiver to sell substantially all of the Receivership Entities’ assets free and clear of all liens, interests, claims, and encumbrances to Streeterville and Bucktown Capital, through their designated entities, NaturalShrimp Farms, Inc. (“NV Purchaser”), a Nevada corporation, Iowa Shrimp Holdings, LLC (“IA Purchaser”), an Iowa limited liability company, Texas Shrimp Holdings, LLC (“TX Purchaser” or together with NV Purchaser and IA Purchaser, the “Purchasers”), a Texas limited liability company, for a roughly $35,703,789.87 credit bid (based on a secured and administrative claim basis) and $100,000 cash, pursuant to the terms and conditions set forth in that certain Asset Purchase Agreement (“APA”) between Trustee and Purchasers. The order to sell the assets was approved on March 30, 2025 and the title to the assets was transferred to the lenders on May 14, 2025.

Intellectual Property Agreement with Hydrenesis, Inc.

During March of 2026, NaturalShrimp Incorporated entered into an Intellectual Property Acquisition and Management Transition Agreement (the “Agreement”) with Hydrenesis, Inc., a Florida corporation (“Hydrenesis”), and David Antelo. Pursuant to the agreement:

On June 25, 2026, NaturalShrimp Inc, Hydrenesis, Inc., and David Antelo entered into a First Amendment to the Intellectual Property Acquisition and Management Transition Agreement and Amended and Restated Perpetual Field-of-Use License Terms (the “Amendment”). The amendment confirmed that the intellectual property transfer contemplated by the original agreement did not occur. Instead, effective June 25, 2026, Hydrenesis granted the Company a perpetual, worldwide, exclusive, and sublicensable license to use and commercialize the licensed technology in aquaculture and related fields. However, as of June 30, 2026, i) the Company’s outstanding obligation to Hydrenesis had not been extinguished ii) No Series P or Series L preferred shares were issued and iii) no other existing liabilities or obligations (including preferred shares) were restructured, amended, cancelled or exchanged.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOTE 3 – TRANSITION FROM LIQUIDATION BASIS TO GOING CONCERN

During September of 2024, Ampleo Turnaround and Restructuring, LLC was placed as the receiver over the Company’s assets due to its significant outstanding debt. Subsequently, during February of 2025, the receiver filed a motion to sell all of the Company’s assets to Streeterville and Bucktown Capital for an approximate credit bid of $35.7 million and $0.1 million in cash. The motion was approved by the court (overseeing the motion) on March 30, 2025 with title to the assets being transferred to the creditor on May 14, 2025. The Company believes that it continued to function as a going concern until the date the motion to sell its assets was approved by the court at which time its liquidation became imminent. Furthermore, on June 25, 2026, Hydrenesis, a related party under common control, granted the Company a perpetual license to use and commercialize the licensed technology in aquaculture and related fields. The Company believes that as of that date its liquidation was no longer imminent and, as such, it transitioned back to being a going concern.

Based on the above, the Company has presented the following in its interim financial statements for the period ended June 30, 2026:

NOTE 4 – INTELLECTUAL PROPERTY TRANSFER

On June 25, 2026, Hydrenesis, a related party under common control, granted the Company a perpetual, worldwide, exclusive and sublicensable license to use and commercialize licensed technology in aquaculture and related fields (“IP”). In exchange for the transferred IP, the Company agreed to issue Series P preferred stock and series P-2 preferred stock to Mr. Antelo and Hydrenesis, respectively. Additional preferred stock may be earned by both Mr. Antelo and Hydrenesis upon achievement of certain milestones outlined in the agreement. No preferred shares were issued as of June 30, 2026.

In accordance with ASC 805-50, the Company recognized the perpetual license at its carrying amount in the accounts of the transferring entity at the date of transfer. As the transferor had recognized all costs related to developing the IP as research and development expense, the Company did not recognize as asset related to the transferred IP. Further, as the preferred shares were not yet authorized or issued, the Company has not presented them on the face of their balance sheet. Once the preferred shares are issued, the Company plans to recognize the shares at a $0 value on the face of its balance sheet and classify them in permanent equity.

NOTE 5 –CURRENT LIABILITIES

Accounts Payable

Accounts payable was comprised of various payables to a significant number of vendors. The Company is currently in active talks with the vendors to settle the outstanding payables through the issuance of preferred shares.

Accounts Payable-Related Party

The Company had an outstanding liability to Hydrenesis of approximately $1.3 million related to an equipment rights agreement (with that entity) that was entered into during 2021. As a result of the perpetual license agreement (discussed in Note 4), Natural Shrimp and Hydrenesis became related parties as both entities have the same chief executive officer. The Company plans to settle the outstanding liability through the issuance of preferred shares.

Accrued Expenses

Accrued expenses was primarily comprised of $1.8 million in accrued compensation to former employees and $1.7 million outstanding to the Company’s former legal counsel. The Company is currently in active discussion with both the former employees and former legal counsel to settle the outstanding balance through the issuance of equity instruments (warrants or preferred shares).

Notes Payable

The Company had approximately $1.2 million in outstanding loans as of June 30, 2026. The loans were primarily with former employees and were all in default as of June 30, 2026. The Company is in active negotiations with the former employees in attempt to settle the outstanding notes through the issuance of preferred shares. Per agreements with the creditors interest on the outstanding notes ceased being accrued as of September 8, 2024 (i.e. the receivership date).

Dividends Payable

Dividends payable relates to accrued dividends on the former Series E, F and G preferred shares. The Company is in active negotiations with the preferred shareholders in attempt to settle the outstanding payables through the issuance of preferred shares.

Mandatorily Redeemable Preferred Shares

The Company’s Series E and G have been recognized as a liability (in accordance with ASC 480) as they were considered mandatorily redeemable as of June 30, 2026.

NOTE 6 – STOCKHOLDERS’ EQUITY

Preferred Stock

Series E

On April 14, 2021, the Board authorized the issuance of 10,000 shares of the Company’s Series E Preferred Stock and filed a Certificate of Designation (“COD”) of Preferences of the Series E Convertible Preferred Stock with the State of Nevada. The shares of Series E Preferred Stock have a stated value of $1,200 per share and are convertible into shares of common stock at the election of the holder of the Series E Preferred Stock at any time at a price of $0.35 per share, subject to adjustment (the “Conversion Price”). The Series E Preferred Stock is convertible into that number of shares of common stock determined by dividing the Series E Stated Value (plus any and all other amounts which may be owing in connection therewith) by the Conversion Price, subject to certain beneficial ownership limitations. Each holder of Series E Preferred Stock shall be entitled to receive, with respect to each share of Series E Preferred Stock then outstanding and held by such holder, dividends at the rate of twelve percent (12%) per annum, payable quarterly. Each share of Series E Preferred Stock shall be redeemed by the Company on the date that is no later than one calendar year from the date of its issuance. The Series E Preferred Stock are also redeemable at the Company’s option, at percentages ranging from 115% to 125% for the first 180 days, based on the passage of time. The holders of Series E Preferred Stock rank senior to the Common Stock and Common Stock Equivalents (as defined in the Series E Designation) with respect to payment of dividends and rights upon liquidation and will vote together with the holders of the Common Stock on an as-converted basis, subject to beneficial ownership limitations, on each matter submitted to a vote of holders of Common Stock (whether at a meeting of shareholders or by written consent). Based upon a subsequent financing, the holder has the option to exchange (in lieu of conversion), all or some of the shares of Series E Preferred Stock then held for any securities or units issued in a subsequent financing on a $1.00 for $1.00 basis. In the event of a Fundamental Transaction, the holder has the option to request that the Company or the successor entity shall purchase the Preferred Stock from the Holder on the date of such request by paying to the Holder cash in an amount equal to the Black Scholes value. Upon any triggering event as set forth in the COD, including a change in control or the Company shall fail to have available a sufficient number of authorized and unreserved shares of common stock to issue to such holder upon a conversion, each holder shall have the right, exercisable at the sole option of such holder, to require the Company to redeem all of the Series E Preferred Stock then held by such holder for a redemption price, in cash, equal to the Triggering Redemption Amount (150% of the Stated Value and all accrued but unpaid dividends and all liquidated damages, late fees and other costs), and increase the dividend rate on all of the outstanding Preferred Stock held by such Holder to 18% per annum thereafter. Upon any liquidation, dissolution or winding-up of the Company, the holders shall be entitled to receive out of the assets of the Company an amount equal to the stated value, plus any accrued and unpaid dividends and any other fees or liquidated damages then due and owing for each share of Preferred Stock, before any distribution or payment shall be made to the holders of any Junior Securities, and if the assets of the Corporation. Because the preferred shares were mandatorily redeemable as of June 30, 2026 they have been classified as a liability.

Series F

On February 22, 2021, the Board authorized the issuance of 750,000 shares of the Company’s Series F Preferred Stock and filed a Certificate of Designation (“COD”) of Preferences of the Series F Preferred Stock with the State of Nevada. The Series F preferred shares does not include any dividends and does not have liquidation preference. However, each share carries 1,000 votes (voting with common stock as a single class), and after a 3-year lockup, holders can convert all their shares into a flat 8% of the company’s fully-diluted common stock, split-adjustment-proof.

Series G

On December 1, 2023, the Board authorized the issuance of 10,000 preferred shares to be designated as Series G Preferred Stock (“Series G Preferred Stock”). The Series G Preferred Stock has a par value of $0.0001, a stated value of $1,200 and bear dividends at the rate of 8% per annum, payable quarterly, to be paid in cash or in-kind, at the discretion of the Company. The Series G Preferred Stock will vote together with the common stock on an as-converted basis subject to the beneficial ownership limitations. The Series G Preferred Stock is required to be redeemed by the Company no later than one calendar year from the date of its issuance. The Series G Preferred Stock is also redeemable at the option of the Company at any time after the original issued date, upon 3 business days’ notice, at a premium rate which is (a) 1.15 if all of the Series G Preferred Stock is redeemed within 90 calendar days from the issuance date thereof; (b) 1.2 if all of the Series G Preferred Stock is redeemed after 90 calendar days and within 120 calendar days from the issuance date thereof; (c) 1.25 if all of the Series G PS is redeemed after 120 calendar days and within 180 calendar days from the issuance date thereof. The Company shall be permitted to redeem the Series G Preferred Stock at any time in cash upon 3 business days prior notice to the Holder or the Holder may convert the Series G Preferred Stock within 3 business days period prior to redemption. The Holder shall have the right to either redeem for cash or convert the Series G Preferred Stock into common stock within 3 business days following the consummation of a qualified offering. The conversion price is based on the discounted market price which is the lower of: (i) A fixed price equaling the closing bid price for the common stock on the trading day preceding the execution of the SPA ; or (ii) 100% of the lowest volume weighted average price (“VWAP)” for the common stock during 10 trading days preceding the conversion request, subject to adjustment. Because the preferred shares were mandatorily redeemable as of June 30, 2026 they have been classified as a liability.

On June 30, 2026, the Company exchanged 4 shares of Series G preferred stock for the issuance of 60,000,000 common shares.

Series M

On May 6, 2026, the Company signed a Securities Purchase Agreement (SPA) with GHS Investments LLC (“GHS”), for the private placement of a new class of Series M Convertible Preferred Stock. At the Initial Closing, the Company sold 132 shares of Series M Preferred at $1,000 per share for gross proceeds of $132,000 (or $120,000 net of $12,000 in legal fees). In addition, the Company also issued 10 additional “Commitment Shares” as an equity kicker resulting in the issuance of 142 total shares at closing. Up to 230 additional shares may be sold in Additional Closings, at the Purchaser’s discretion, subject to certain Equity Conditions bringing the maximum issuance to 372 Series M shares. Each share has a Stated Value of $1,200.

The preferred shares include the following key terms:

In accordance with ASC 480, Distinguishing Liabilities and Equity and ASC 815, Derivatives and Hedging, the Company concluded that the preferred shares did not contain an embedded derivative and should be classified in temporary equity (as a result of mandatory redemption upon on event of default). Further, as the dividends can be paid in either cash or additional preferred shares the accrued dividends are recognized as an increase in temporary equity.

Series A

The Company’s Series A Convertible Preferred Stock were authorized on August 15, 2018 (5,000,000 shares, $0.0001 par). The series A does not include any dividends, and only a nominal $0.001/share liquidation preference ahead of common. Its voting rights include 60 votes per share, split-adjustment-protected, voting together with common stock on all matters including director elections.

Common Stock

As of June 30, 2026, the Company had 1,400,000,000 shares of common stock authorized with a par value of $0.0001. Of this amount, 1,337,546,746 shares were outstanding.

NOTE 7 – SUBSEQUENT EVENTS

In accordance with ASC 855, Subsequent Events, the Company evaluated all events or transactions that occurred after the balance sheet date but before the financial statements were issued. To that extent, the Company noted the following:

Loan Forgiveness

Subsequent to the balance sheet date two loans (that were issued to former employees) were forgiven in the amount of $100,000 ($50,000 per loan). All interest that was accrued on the loans as of September 8, 2024 was not part of the forgiveness and still remains outstanding.