U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

Mark One

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

For the quarterly period ended JuneSeptember 30, 20172023

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

For the transition period from _______ to _______

Commission File No.333-141060001-40715

PetVivo Holdings, Inc.

(Name of small business issuer in its charter)

5251 Edina Industrial Blvd.

Edina, Minnesota55439

(Address of principal executive offices)

(952)405-6216

(Issuer’s telephone number)

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

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

Common Stock, $0.001

(Title of Class)

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

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Section 229.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files. Yes [X] ☒ No [  ]☐

Indicate by check mark whether the registrant is a large accelerated filed,filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.

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

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

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the most practicable date:

PETVIVO HOLDINGS, INC.

FORM 10-Q

FOR THE PERIOD ENDED JUNESEPTEMBER 30, 20172023

INDEX

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995

Information included in this Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (“Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (“Exchange Act”). This information may involve known and unknown risks, uncertainties, and other factors which may cause the actual results, performance, or achievements of PetVivo Holdings, Inc. (the “Company”), to be materially different from future results, performance, or achievements expressed or implied by any forward-looking statements. Forward-looking statements, which involve assumptions and describe future plans, strategies, and expectations of the Company, are generally identifiable by use of the words “may,” “will,” “should,” “expect,” “anticipate,” “estimate,” “believe,” “intend,” or “project” or the negative of these words or other variations on these words or comparable terminology. These forward-looking statements are based on assumptions that may be incorrect, and there can be no assurance that thesethe projections included in these forward-looking statements will come to pass. Actual results of the Company could differ materially from those expressed or implied byin the forward-looking statements as a result of various factors.statements. Factors that might cause or contribute to such differences include, but are not limited to, those discussed in “Risk Factors” included in documents we file from time to time with the U.S. Securities and Exchange Commission (the “SEC’), including our Annual Report on Form 10-K for our fiscal year ended March 31, 2023, (“2023 10-K Report”) and risks described in other SEC filings. Except as required by applicable laws, the Company has no obligation to update publicly any forward-looking statements for any reason, even if new information becomes available or other events occur in the future.

PART II.

ITEM 1. FINANCIAL STATEMENTS

PETVIVO HOLDINGS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

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

PETVIVO HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)

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

PETVIVO HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

(UNAUDITED)

Three and Six Months Ended September 30, 2023

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

PETVIVO HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

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

PetVivo Holdings, Inc.

Condensed Notes to Financial Statements

JuneSeptember 30, 20172023

(Unaudited)

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ORGANIZATION

(A) Organization and Description

The Company is in the business of licensing and commercializing our proprietary medical devices and biomaterials for the treatment and/or management of afflictions and diseases in animals, initially for dogs and horses. The Company began commercialization of its lead product Spryng™ with OsteoCushion™ Technology, a veterinarian-administered, intraarticular injection for the management of lameness and other joint afflictions such as osteoarthritis in dogs and horses in September 2021. The Company has a pipeline of additional products for the treatment of animals in various stages of development. A portfolio of twenty patents protects the Company’s biomaterials, products, production processes and methods of use. The Company’s operations are conducted from its headquarter facilities in suburban Minneapolis, Minnesota.

(B) Basis of Presentation

PetVivo Holdings, Inc. (the “Company”) was incorporated in Nevada under a former name in 2009 and entered itits current business in 2014 through a stock exchange reverse merger with PetVivo, Inc., a Minnesota corporation. This merger resulted in Minnesota PetVivo, Inc. becoming a wholly-owned subsidiary of the Company.

In April 2017, the Company acquired another Minnesota corporation, Gel-Del Technologies, Inc., through a statutory merger, which is also a wholly ownedwholly-owned subsidiary of the Company.

The accompanying condensedunaudited consolidated financial statements are unaudited. These unaudited interim financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial reporting and pursuant to the rules and regulations of the SEC. CertainAccordingly, they do not include all of the information and note disclosures, which are included in annualfootnotes required by GAAP for complete financial statements, have been omitted pursuant to these rules and regulations. We believe the disclosures made in these interim unaudited financial statements are adequate to make the information not misleading.

Although these interim financial statements at June 30, 2017 and for the three months ended June 30, 2017 and 2016 are unaudited, instatements. In the opinion of our management, such statements include all adjustments (consisting(including those which are normal and recurring) considered necessary for a fair presentation of normal recurring entries) necessary to present fairly ourthe interim financial position, results of operations and cash flows for the periods presented.information have been included. The results for the three and six months ended JuneSeptember 30, 20172023, are not necessarily indicative of the results to be expected for the year endedending March 31, 20182024, or for any other interim period or for any future period.

year. These unaudited consolidated interim financial statements should be read and considered in conjunction with ourthe audited financial statements and the notes thereto included in our Annual Report on Form 10-K for the year ended March 31, 2017, included in our annual report on Form 10-K filed with the SEC.2023.

The Company is in the business of distribution of medical devices and biomaterials for the treatment of afflictions and diseases in animals. The Company’s management development and other operations are conducted from its headquarter facilities in suburban Minneapolis, Minnesota.

(B) (C) Principles of Consolidation

The accompanying condensed consolidated financial statements include the accounts of the Company’sCompany and its two wholly-owned Minnesota corporations.corporations, Gel-Del Technologies, Inc. and PetVivo, Inc. All intercompany accounts have been eliminated upon consolidation.

The accounting for the acquisition of Gel-Del Technologies, began with the closing of the Security Exchange Agreement on April 10, 2015 and completed with the Agreement and Plan of Merger on April 10, 2017, with the Company’s previously issued 5,450,000 shares valued at market at $0.40 per share, which equaled $2,180,000 on the date of completion (April 10, 2017).

(C) (D) Use of Estimates

In preparing financial statements in conformity with generally accepted accounting principles, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the reportedreporting period. Actual results could differ from those estimates. Significant estimates include collectability of accounts receivable, inventory obsolescence, estimated useful lives and potential impairment of property and equipment and intangibles, estimate of fair value of share basedshare-based payments, distributor rebate payable, provision for product returns, right of use lease assets and derivative instrumentsliabilities and recorded debt discount, valuation of deferred tax assets and valuation of in-kind contribution of services and interest.assets.

(D) (E) Cash and Cash Equivalents

The Company considers all highly liquidhighly-liquid, temporary cash investments with an original maturity of three months or less to be cash equivalents. At June 30, 2017, theThe Company had $5,359no cash equivalents.equivalents at September 30, 2023.

(E) Concentration-Risk(F) Concentration Risk

The Company maintains its cash with various financial institutions, which at times may exceed federally insured limits. At September 30, 2023, the Company did not have cash balances in excess of the federally insured limits.

(F) Machinery(G) Accounts Receivable

Accounts receivable consists primarily of amounts due from a distributor (see revenue recognition). Accounts receivable is recorded based on management’s assessment of the expected consideration to be received, based on a detailed review of historical collections. Management relies on the results of the assessment, which includes payment history of the applicable payer as a primary source of information in estimating the collectability of our accounts receivable as well as a forecast of projected credit losses. We update our assessment on a quarterly basis, which to date has not resulted in any material adjustments to the valuation of our accounts receivable since all receivables to date have been collected. We believe the assessment provides reasonable estimates of our accounts receivable valuation, and therefore we believe that substantially all accounts receivable are fully collectible. Accordingly, as of September 30, 2023 and March 31, 2023, our allowance for credit losses was zero.

(H) Inventory

Inventories are recorded in accordance with Accounting Standards Codification (“ASC”) 330, Inventory, and are stated at the lower of cost or net realizable value. We account for inventories using the first in first out (“FIFO”) methodology. Provisions for inventory obsolescence are charged to Cost of Sales. There were no provisions for obsolescence for the three and six months ended September 30, 2023 and 2022, respectively.

(I) Property & Equipment

MachineryProperty and equipment are recorded at cost. Expenditures for major additions and betterments are capitalized. Maintenance and repairs are charged to operations as incurred. Depreciation of furniture fixtures and equipment is computed by the straight-line method (after taking into accountconsidering their respective estimated residual values) over the assets estimated useful life of five (3)3 to 5 years for production and computer equipment (5)and furniture and 5 to 7 years for automobile, and (7) years for furniture and fixturesleasehold improvements.

(G) (J) Patents and Trademarks

The companyCompany capitalizes direct costs for the maintenance and advancement of their patents and trademarks and amortizes these costs over athe lesser of the useful life of 60 months. months or the life of the patent. We evaluate the recoverability of intangible assets periodically by considering events or circumstances that may warrant revised estimates of useful lives or that indicate the asset may be impaired.

(H) (K) Loss Per Share

Basic loss per share is computed by dividing net loss by weighted average number of shares of common stock outstanding during each period. Diluted loss per share is computed by dividing net loss by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during the period.

The Company has 133,500had 5,447,485 warrants outstanding as of JuneSeptember 30, 20172023, with varying exercise prices ranging from $3.50$1.20 to $1.50/$5.63 per share. The weighted average exercise price for these warrants is $ 2.234.04 per share. These warrants are excluded from the weighted average number of shares because they arewere considered anti-dilutive.

(I) Revenue Recognition

The Company will recognizehad 177,334 restricted stock units outstanding as of September 30, 2023, which are excluded from the weighted average number of shares because they were considered anti-dilutive.

The Company had 1,354,088 stock options outstanding as of September 30, 2023, with varying exercise prices ranging from $1.39 to $2.79 per share. The weighted average exercise price for these options is $2.20 per share. These stock options are excluded from the weighted average number of shares because they were considered anti-dilutive.

The Company had 3,686,320 warrants outstanding as of September 30, 2022, with varying exercise prices ranging from $1.20 to $6.67 per share. The weighted average exercise price for these warrants was $5.02 per share. These warrants were excluded from the weighted average number of shares because they were considered anti-dilutive.

The Company had 339,418 restricted stock units outstanding as of September 30, 2022, which were excluded from the weighted average number of shares because they were considered anti-dilutive.

The Company had 393,789 options outstanding as of September 30, 2022, with varying exercise prices ranging from $1.39 to $2.79 per share. The weighted average exercise price for these options was $1.91 per share. These options were excluded from the weighted average number of shares because they were considered anti-dilutive.

The Company uses the guidance in ASC 260 to determine if-converted loss per share. ASC 260 states that convertible securities should be considered exercised on the latter of the first day of the reporting period’s quarter or the inception date of the debt instrument. Also, the if-converted method shall not be applied for the purposes of computing diluted EPS if the effect would be anti-dilutive.

(L) Revenue Recognition

The Company recognizes revenue on arrangements in accordance with FASB ASC No. 605,606 “Revenue Recognition”. In all cases,from Contracts with Customers.”

The Company derives revenue from the sale of its pet care products directly to its veterinarian customers in the United States. The Company recognizes revenue when performance obligations under the terms of a contract with the veterinarian customer are satisfied. Product sales occur once control or title is transferred based on the commercial terms. Revenue is recognized onlyupon delivery to the customer, which is when control of these products is transferred and in an amount that reflects the priceconsideration the Company expects to receive for these products. Shipping costs charged to customers are reported as an offset to the respective shipping costs. The Company does not have any significant financing components as payment is fixed and determinable, persuasive evidencereceived at or shortly after the point of an arrangement exists,sale.

The Company entered into a Distribution Services Agreement (the “Agreement”) with MWI Veterinary Supply Co. (the “Distributor”) on June 17, 2022. Contracts with the service is performed and collectabilityDistributor are evidenced by individual executed purchase orders subject to the terms of the resulting receivable is reasonably assured. RevenuesAgreement. The contracts consist of Kusha single performance obligation related to the sale of our pet care products. Product sales occur once control or title is transferred based on the commercial terms in the Agreement. Revenue is recognized upon delivery to the Distributor; payment is due within 60 days. The Agreement provides for a distribution fee payable to the Distributor equal to 5% of gross monthly sales payable in 45 days; the distribution fee is netted against revenue. The Agreement provides for a rebate payable to the Distributor based on annual sales volume that is retroactively applied. The rebate is estimated under the expected value method and is netted against revenue. Sales are subject to various right of return provisions; the Company uses an expected value method to estimate returns and has determined that any returns would be immaterial as of September 30, 2023. As a result, there is no return liability recorded. Shipping and handling costs are a fulfillment activity and are reported as cost of sales.

For the three months ended September 30, 2023 and 2022, the Company recognized revenue from product sales to veterinary clinics.under the Agreement of $143,606 and $118,264, respectively. This represents 69% and 53% of total revenues for the three months ended September 30, 2023 and 2022, respectively.

For the six months ended September 30, 2023 and 2022, the Company recognized revenue from product sales under the Agreement of $177,395 and $118,264, respectively. This represents 55% and 42% of total revenues for the six months ended September 30, 2023 and 2022, respectively.

Assets and liabilities (included in accrued expenses) under the Agreement were as follows:

SCHEDULE OF RECOGNIZED REVENUE ASSETS AND LIABILITIES

(M) Research and Development

The Company expenses research and development costs as incurred.

(K) (N) Fair Value of Financial Instruments

The Company applies the accounting guidance under Financial Accounting Standards Board (“FASB”) ASC 820-10,“Fair “Fair Value Measurements”, as well as certain related FASBFinancial Accounting Standards Board (“FASB”) staff positions. This guidance defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required to be recorded at fair value, the Company considers the principal or most advantageous market in which it would transact business and considers assumptions that marketplace participants would use when pricing the asset or liability, such as inherent risk, transfer restrictions, and risk of nonperformance.

The guidance also establishes a fair value hierarchy for measurements of fair value as follows:

The Company’s financial instruments consist of accounts receivable, accounts payable, accrued expenses notesand note payable notes payable - related party, and convertible notes payable.accrued interest. The carrying amount of the Company’s financial instruments approximates their fair value as of JuneSeptember 30, 20172023 and March 31, 2017,2023, due to the short-term nature of these instruments.instruments and the Company’s borrowing rate of interest.

In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. The valuation of the Company’s notesnote recorded at fair value is determined using Level 3 inputs, which consider (i) time value, (ii) current market, and (iii) contractual prices.

The Company had no assets and liabilities measured at fair value on a recurring basis at Juneon September 30, 20172023 and DecemberMarch 31, 2016.2023.

(O) Stock-Based Compensation

(L)Recent Accounting Pronouncements

The FASB issued ASC 606 as guidanceStock-based compensation is accounted for based on the requirements of ASC 718 – “Compensation – Stock Compensation”‘ which requires recognition in the financial statements of revenue from contracts with customers in May 2014 with amendments in 2015the cost of employee, director, and 2016. Revenue recognition will depict the transfer of promised goods ornon-employee services to customers in an amount that reflects the consideration to which the entity expects to be entitledreceived in exchange for those goodsan award of equity instruments over the period the employee, director, or services.non-employee is required to perform the services in exchange for the award (presumptively, the vesting period). The guidanceASC also requires disclosures regardingmeasurement of the nature,cost of employee, director, and non-employee services received in exchange for an award based on grant-date fair value of the award. The Company has elected to recognized forfeitures as they occur as permitted under Accounting Standards Update (“ASU”) 2016-09 Improvements to Employee Share-Based Payment.

(P) Income Taxes

The Company accounts for income taxes under ASC 740. Deferred tax assets and liabilities are determined based upon differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. A valuation allowance is provided when it is more likely than not that some portion or all of a deferred tax asset will not be realized.

As required by ASC 450, the Company recognizes the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. For tax positions meeting the more-likely-than-not threshold, the amount timing and uncertaintyrecognized in the financial statements is the largest benefit that has a greater than 50 percent likelihood of revenue and cash flows arising from contracts with customers. The guidance permits two methods of adoption: retrospectively to each prior reporting period presented, or retrospectivelybeing realized upon ultimate settlement with the cumulative effect of initially applying the guidance recognized at the date of initial application (the cumulative catch-up transition method). relevant tax authority.

The company will adopt the guidance on January 1, 2018 and apply the cumulative catchup transition method. The transition adjustment to be recorded to stockholders’ equity upon adoption of the new standardCompany is not expectedcurrently under examination by any federal or state jurisdiction.

The Company’s policy is to be material.record tax-related interest and penalties as a component of operating expenses.

In February 2016,(Q) Recent Accounting Pronouncements

The Company has reviewed the FASB issued ASU No. 2016-02, Leases (Topic 842) to increase transparencyaccounting pronouncements and comparability among organizations by recognizing lease assetsinterpretations thereof that have effectiveness dates during the periods reported and lease liabilitiesin future periods. The Company has carefully considered the new pronouncements that alter previous generally accepted accounting principles and does not believe that any new or modified principles will have a material impact on the balance sheet and disclosing key information about leasing arrangements. Topic 842 affects any entity that enters into a lease, with some specified scope exemptions. The guidance in this ASU supersedes Topic 840, Leases. The core principle of Topic 842 is that a lessee should recognize the assets and liabilities that arise from leases. A lessee should recognizeCompany’s reported financial position or operations in the statementnear term. The applicability of any standard is subject to the formal review of the Company’s financial positionmanagement.

In August 2020, the FASB issued ASU 2020-06, Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40) - Accounting for Convertible Instruments and Contracts on an Entity’s Own Equity. The ASU simplifies accounting for convertible instruments by removing major separation models required under current GAAP. Consequently, more convertible debt instruments will be reported as a single liability instrument with no separate accounting for embedded conversion features. The ASU removes certain settlement conditions that are required for equity contracts to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying assetqualify for the lease term. For public companies,derivative scope exception, which will permit more equity contracts to qualify for the amendmentsexceptions. The ASU also simplifies the diluted net income per share calculation in this ASU arecertain areas. The new guidance is effective for fiscal years beginning after December 15, 2018,2023, including interim periods within those fiscal years.years, and early adoption is permitted. The Company is currently evaluating the impact of adoptingthe adoption of the standard on the consolidated financial statements.

In June 2016, the FASB issued ASU No. 2016-022016-13, “Financial Instruments-Credit Losses (Topic 326), Measurement of Credit Losses on itsFinancial Instruments,” which replaces the existing “incurred loss” model for recognizing credit losses with an “expected loss” model referred to as the CECL model. Under the CECL model, the Company is required to present certain financial assets carried at amortized cost, such as accounts receivable, at the net amount expected to be collected. The measurement of expected credit losses is based on information about past events, including historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. The Company adopted this standard in the consolidated financial statements for the six months ended September 30, 2023. The change had no impact on the Company’s financial statements.

All other newly issued accounting pronouncements but not yet effective accounting pronouncements have been deemed either immaterial or not applicable.

NOTE 2 - CONVERTIBLE NOTES PAYABLE– INVENTORY

As of September 30, 2023 and March 31, 2023, the Company had inventory of $434,080 and $370,283, respectively.

The inventory components are as follows:

SCHEDULE OF INVENTORY

NOTE 3 – PREPAID EXPENSES AND OTHER CURRENT ASSETS

As of September 30, 2023, the Company had $1,370,604 in prepaid expenses and other current assets consisting primarily of $785,000 in deferred consulting fees, $45,000 in investor relations costs, $292,000 in insurance costs, $91,000 in tradeshows, $33,000 in Nasdaq and FINRA fees, $37,000 in deferred issuance costs, $32,000 in software subscription fees, and $25,000 in rent.

The deferred consulting fees totaling $785,000 consist of $537,500 of common stock issued and cash of $247,500 related to one consulting agreement. In October 2023, the consulting agreement was terminated and all the common stock that was issued and the cash that was paid was returned to the Company.

As of March 31, 2023, the Company had $491,694 in prepaid expenses and other current assets consisting primarily of $115,000 in investor relations services, $130,000 in insurance costs, $63,000 in Nasdaq and FINRA fees, $56,000 in board compensation, $42,000 in tradeshows, $42,000 in supplier advance, and $19,000 in software subscription fees.

NOTE 4 – PROPERTY AND EQUIPMENT

The components of property and equipment were as follows:

SCHEDULE OF PROPERTY AND EQUIPMENT

Depreciation expense was $30,078 and $28,719 for the three months ended September 30, 2023 and 2022, respectively. Depreciation expense was $59,089 and $54,044 for the six months ended September 30, 2023 and 2022, respectively.

NOTE 5 – PATENTS AND TRADEMARKS

The components of patents and trademarks, all of which are finite-lived, were as follows:

SCHEDULE OF COMPONENTS OF PATENTS AND TRADEMARKS

Amortization expense was $2,137 and $2,227 for the three months ended September 30, 2023 and 2022, respectively. Amortization expense was $4,275 and $4,466 for the six months ended September 30, 2023 and 2022, respectively.

NOTE 6 – ACCRUED EXPENSES

The components of accrued expenses were as follows:

SCHEDULE OF COMPONENTS OF ACCRUED EXPENSES

Pursuant to a lease wherein our subsidiary, Gel-Del Technologies, Inc., was the lessee until and through the lease’s termination in fiscal year 2018, the Company had recorded approximately $332,000 as a potential payable to the lessor. This liability remains outstanding as of September 30, 2023 and March 31, 2023.

NOTE 7 – NOTE PAYABLE

In January 2020, the Company entered into a lease amendment for our corporate office facility whereby the lease term was extended through November of 2026 in exchange for a loan of $42,500. The note payable accrues interest at a rate of 6% per annum. At September 30, 2023 and March 31, 2023, the amount outstanding on the note was $23,995 and $27,351, respectively. At September 30, 2023, the Company classified $7,139 as a current liability and $16,856 in other liabilities. At March 31, 2023, the Company classified $6,936 as a current liability and $20,415 in other liabilities.

NOTE 8 – RETIREMENT PLAN

In February 2021, the Company established a 401(k) retirement plan for its employees in which eligible employees can contribute a percentage of their compensation. The Company may also make discretionary contributions. For the three months ended September 30, 2023 and 2022, the Company made contributions to the plan of $12,854 and $8,183, respectively. For the six months ended September 30, 2023 and 2022, the Company made contributions to the plan of $25,408 and $14,341, respectively.

NOTE 9 – COMMITMENTS AND CONTINGENCIES

Lease Obligations

We lease property and equipment under operating leases, typically with terms greater than 12 months, and determine if an arrangement contains a lease at inception. In general, an arrangement contains a lease if there is an identified asset and we have the right to direct the use of and obtain substantially all of the economic benefit from the use of the identified asset. We record an operating lease liability at the present value of lease payments over the lease term on the commencement date. The related right of use (‘‘ROU”) operating lease asset reflects rental escalation clauses, as well as renewal options and/or termination options. The exercise of lease renewal and/or termination options is at our discretion and is included in the determination of the lease term and lease payment obligations when it is deemed reasonably certain that the option will be exercised. When available, we use the rate implicit in the lease to discount lease payments to present value; however, certain leases do not provide a readily determinable implicit rate. Therefore, we must estimate our incremental borrowing rate to discount the lease payments based on information available at lease commencement.

We classify our leases as buildings, vehicles or computer and office equipment and do not separate lease and nonlease components of contracts for any of the aforementioned classifications. In accordance with applicable guidance, we do not record leases with terms that are less than one year on the Consolidated Balance Sheets.

None of our lease agreements contain material restrictive covenants or residual value guarantees.

Buildings

The Company entered into an eighty-four month lease for 3,577 square feet of newly constructed office, laboratory, and warehouse space located in Edina, Minnesota in May 2017. The base rent has annual increases of 2% and the Company is responsible for its proportional share of common space expenses, property taxes, and building insurance. This lease is terminable by the landlord if damage causes the property to no longer be utilized as an integrated whole and by the Company if damage causes the facility to be unusable for a period of 45 days. In January 2020, the Company entered into a lease amendment to extend the lease term through November of 2026 in exchange for receipt of a loan of $42,500 recorded to note payable. The monthly base rent as of September 30, 2023 and March 31, 2023 was $2,294.

The Company entered into a sixty-three month lease for 2,400 square feet of office space located in Edina, Minnesota in January 2022. This lease will expire in March 2027. The base rent has annual increases of 2.5% and the Company is responsible for its proportional share of common space expenses, property taxes, and building insurance. The monthly base rent as of September 30, 2023 and March 31, 2023 was $2,740 and $2,673, respectively.

On January 10, 2023, the Company entered into a new lease agreement for approximately 14,000 square feet of production and warehouse space with a commencement date of April 1, 2023, which is when the control and right of use for this asset took place. The initial monthly base rent is $8,420 and has annual increases of 2.5%. The Company is also responsible for its proportional share of common space expenses, property taxes, and building insurance. The lease will terminate on June 30, 2033 and the Company has a renewal option for a period of five years. The monthly base rent as of September 30, 2023 was $8,420.

Vehicles

We leased vehicles for certain members of our field sales organization in the six months ended September 30, 2023, under a vehicle fleet program whereby the noncancelable lease is for a term of 48 months. The Company recognized an operating lease right-of-use asset for approximately $150,000 and corresponding and equal operating lease liability for the lessee. As of September 30, 2023, in addition to monthly rental fees specific to the vehicle, there are fixed monthly nonlease components that have been included in the ROU operating lease assets and operating lease liabilities. The nonlease components are not significant.

Operating lease expense for the three months ended September 30, 2023 and 2022, was $104,473 and $51,994, respectively. Operating lease expense for the six months ended September 30, 2023 and 2022 was $175,265 and $101,954, respectively.

The following is a maturity analysis of the annual undiscounted cash flows of the operating lease liabilities as of September 30, 2023:

SCHEDULE OF ANNUAL UNDISCOUNTED OPERATING LEASE LIABILITY

In compliance with ASC 842, the Company recognized, based on the extended lease terms to June 2026, November 2026, March 2027, and June 2033, a treasury rate of 0.12%, 0.40%, 7.6%, and 4.39%, respectively, an operating lease right-of-use assets for approximately $1,465,000 and corresponding and equal operating lease liabilities for the leases. As of September 30, 2023, the present value of future base rent lease payments based on the remaining lease terms and weighted average discount rate are approximately 4.8 years and 4.11%, respectively, are as follows:

SCHEDULE OF BASE RENT LEASE PAYMENTS

As of September 30, 2023, the present value of future base rent lease payments – net is classified between current and non-current assets and liabilities as follows:

SCHEDULE OF LEASE CURRENT AND NON-CURRENT ASSETS AND LIABILITIES

Employment Agreements

The Company has employment agreements with its executive officers. As of September 30, 2023, these agreements contain severance benefits ranging from one convertible note outstandingmonth to six months if terminated without cause.

Legal Proceedings

David Masters, a former employee, board member, and consultant to the Company, has threatened to file suit against the Company to recover in excess of $2 million. Masters’ threatened litigation relates to allegations that the Company promised him additional compensation, shares, warrants, and future employment while he was associated with the Company. The Company mediated these claims with Masters in 2022 and executed a mediated settlement agreement resolving these claims for a one-time payment of $180,000, to be effective upon execution of a long form agreement containing these and other settlement terms. The parties appointed the mediator as arbitrator to resolve any disputes arising during the drafting of the long form agreement on commercially reasonable terms. In early 2023, Masters commenced arbitration to have certain terms in the amountlong form agreement decided. The arbitrator issued an award setting the final terms of $105,000 plus accrued interest of $4,315.

NOTE 3 - RELATED PARTY PAYABLE

At June 30, 2017, the company is obligated for an officer note payable and accrued interestagreement. Soon thereafter, Masters refused to execute the long form agreement set by the arbitrator; terminated the law firm representing him in the total amountmediation, negotiations, and arbitration; suggested that the arbitration award was tainted by a conflict of $200,190.interest; and threatened the claims set forth above.

In September 2023, Masters executed the long-term agreement and the Company recorded a settlement expense of $180,000. The settlement was paid in October 2023.

NOTE 4 - NOTE PAYABLE10 – GOING CONCERN

The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, which contemplate continuation of the Company as a going concern.

The Company is obligated onincurred net losses of $6,554,730 for the following notes:

*Assix months ended September 30, 2023, had net cash used in operating activities of June 30, 2017, Gel-Del Technologies, Inc. was delinquent in the monthly payments of the Bank Credit Line and a Bank Credit Card issued by$4,604,962 for the same banking institution. The Company negotiated with the bank regarding restructuring the Bank Credit Line havingperiod, and has an outstanding balanceaccumulated deficit of $50,000 and the Bank Credit Card having an outstanding balance of $10,000; both were originally incurred by Gel-Del Technologies, Inc. The combined balance of $60,000 was settled for $38,000$78,398,759 on September 29, 2017 with a payment plan beginning on September 29th with an initial payment of $8,000 and three additional payments of $10,000 on the 15th of October, November, and December.

NOTE 5 - GOING CONCERN

As reflected in the accompanying condensed consolidated financial statements, the Company had no significant revenue and had a negative equity and recurring material losses.30, 2023. These factorsconditions raise substantial doubt about the Company’s ability to continue as a going concern.concern for a period of at least twelve months after the date of issuance of these financial statements. In view of these matters, the Company’s ability to continue as a going concern is dependent upon the Company’s ability to achieve a level of profitability and/or to obtain adequate financing through the issuance of debt or equity in order to finance its operations.

Management intendsThe Company raised an aggregate of $1,070,000 in October and on November 6, 2023 from (i) the sale of 725,000 shares pursuant to raise additional funds either throughits ATM Sales Agreement dated August 23, 2023 between the Company and ThinkEquity LLC and facilities and (ii) in a private placement or public offering of its equity securities.to accredited investors. Management believes that the actions presently being taken to further implement its business plan will enable the Company to continue as a going concern. While the Company believes in its viabilityability to raise additional funds, there can be no assurances to that effect. The ability of the Company to continue as a going concern is dependent upon the Company’s ability to further implement its business plan and raise additional funds.

These financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

NOTE 11 – STOCKHOLDERS’ EQUITY

NOTE 6 - COMMON STOCK

Equity Incentive Plan

From April 1, 2017

On July 10, 2020, our Board of Directors unanimously approved the PetVivo Holdings, Inc. 2020 Equity Incentive Plan (the “2020 Plan”), which authorized the issuance of up to June 30, 2017,1,000,000 shares of our common stock as awards under the 2020 Plan, subject to approval by our stockholders at the Annual Meeting of Stockholders held on September 22, 2020, when it was approved by our stockholders and became effective. On October 14, 2022, the stockholders of the Company issued 2,569,628 shares of common stock of which 2,100,128 were issued to reduce accrued salaries valued at $1,209,919; 379,500 shares were for services valued at market for $156,825; and 90,000 shares for cash of $31,500.

As of June 30, 2017,approved the Company had 133,250 warrants outstanding. On August 5, 2015, 40,000 warrants were issued as settlement for business advising, management consulting, fund raising and public relations consulting at exercise price of $3.50/share for a five year term. On April 11, 2016, 20,000 warrants were issued as part of subscription agreements at an exercise price of $2.00/share for a term of five years. On June 7, 2016, 13,250 warrants were issued as part of a subscription agreement at an exercise price of $2.00/share for a term of five years. On September 19, 2016, 60,000 warrants were issued as part of a subscription agreement at an exercise price of $1.50/share for a term of five years.

NOTE 7 - AGREEMENT AND PLAN OF MERGER

In April 10, 2017, the Agreement and Plan of Merger completed by the Company’s subsidiary, PetVivo Holdings, Newco Inc. (“Newco”)Amended and Gel-Del Technologies, Inc. with Gel-Del beingRestated 2020 Equity Incentive Plan (the “Amended Plan”), which increased the surviving corporation and becoming a wholly-owned subsidiarynumber of the Company. Under the Merger Agreement, all shareholders of Gel-Del exchanged their shares for 5,540,000 shares of the Company’s restricted common stock, which represented approximately 30% of the total issued and outstanding shares of the Company’s common stock post-merger.which may be granted under the Amended Plan from 1,000,000 to 3,000,000. Unless sooner terminated by the Board, the Amended Plan will terminate at midnight on July 10, 2030. The number of shares available to grant under the Plan was 1,039,235 at September 30, 2023.

Employees, consultants, advisors of the Company (or any subsidiary), and non-employee directors of the Company will be eligible to receive awards under the Amended Plan. In the case of consultants and advisors, however, their services cannot be in connection with the offer and sale of securities in a capital-raising transaction nor directly or indirectly to promote or maintain a market for PetVivo common stock.

The Amended Plan is administered by the Compensation Committee of our Board of Directors (the “Committee”), which has full power and authority to determine when and to whom awards will be granted, and the type, amount, form of payment, any deferral payment, and other terms and conditions of each award. Subject to provisions of the Amended Plan, the Committee may amend or waive the terms and conditions, or accelerate the exercisability, of an outstanding award. The Committee also has the authority to interpret and establish rules and regulations for the administration of the Amended Plan. In addition, the Board of Directors may also exercise the powers of the Committee.

The aggregate number of shares of PetVivo common stock available and reserved to be issued under the Amended Plan is 3,000,000 shares, but includes the following limits:

● the maximum aggregate number of shares of Common Stock granted as an Award to any Non-Employee Director in any one Plan Year will be 10,000 shares; provided that such limit will not apply to any election of a Non-Employee Director to receive shares of Common Stock in lieu of all or a portion of any annual Board, committee, chair or other retainer, or any meeting fees otherwise payable in cash.

Awards can be granted for no cash consideration or for any cash and other consideration as determined by the Committee. Awards may provide that upon the grant or exercise thereof, the holder will receive cash, shares of PetVivo common stock, other securities or property, or any combination of these in a single payment, installments, or on a deferred basis. The exercise price per share of any stock option and the grant price of any stock appreciation right may not be less than the fair market value of PetVivo common stock on the date of grant. The term of any award cannot be longer than ten years from the date of grant. Awards will be adjusted in the event of a stock dividend or other distribution, recapitalization, forward or reverse stock split, reorganization, merger or other business combination, or similar corporate transaction, in order to prevent dilution or enlargement of the benefits or potential benefits provided under the Amended Plan.

The Amended Plan permits the following types of awards: stock options, stock appreciation rights, restricted stock awards, restricted stock units, deferred stock units, performance awards, non-employee director awards, other stock-based awards, and dividend equivalents.

Convertible Debentures

On July 27, 2023, the Company issued convertible promissory notes (“Convertible Debentures”) in the aggregate amount of $550,000 to three accredited investors pursuant to debenture subscription agreements (“Debenture Subscription Agreement”). The Convertible Debentures mature on January 26, 2024 (the “Maturity Date”), bear interest at a rate of 10% per annum and automatically convert into shares of the Company’s common stock on the earlier of (i) the Maturity Date or (ii) upon the occurrence of certain events prior to the Maturity Date, including, without limitation, the sale of common stock of at least $2 million.

On August 11, 2023, the Company entered into Convertible Debenture Conversion Agreements (“Conversion Agreements”) with the three debenture holders (“Debenture Holders”). Pursuant to the Conversion Agreements, each Debenture Holder agreed to voluntarily and immediately convert the outstanding balance on their Convertible Debenture into shares of the Company’s common stock prior to January 26, 2024, the maturity date of the Convertible Debentures, provided that the Company adjust the original conversion rate to one share of the Company’s common stock for each $1.50 of principal (reduced from $1.60 in the Convertible Debenture) and pay an amount equal to six months of interest (the “New Conversion Rate”) and grant warrants to the Debenture Holders providing each Debenture Holder with the right to purchase the number of shares of the Company’s common stock issued to the Debenture Holder in the conversion. The Debenture Holders converted $550,000 in Convertible Debentures and accrued interest of $27,500 into 385,000 shares of the Company’s common stock and warrants (“Warrants”) to purchase an aggregate of 385,000 shares of the Company’s common stock. The Warrants are exercisable any time on or after February 5, 2024 and prior to August 10, 2026 at an exercise price of $2.00 per share.

Through this Merger,

As a result of the inducement to the Debenture Holders to voluntarily convert the outstanding balance of their Convertible Debentures prior to their maturity date, the Company acquired allrecognized a loss on extinguishment of Gel-Del’s technology and related patents and other intellectual property (IP) and production techniques,debt of $534,366. The loss is comprised of the value of the warrants issued of $463,476, as well as Gel-Del’s modern and secure biomedical product manufacturing facilities under construction in Edina, Minnesota.

NOTE 8 – INCOME TAXES

The Company has not filed tax returns for 2014, 2015, 2016, and 2017. The Company’s subsidiaries, Gel-Del Technologies, Inc., and Cosmeta Corp have not filed tax returns for tax years 2013, 2014, 2015, 2016, and 2017. It should be noted thatdetermined by the tax liability for allBlack Scholes model; the companies for those years is likely to be none or minimalvalue of additional shares issued of $45,834 as a result of net operating losses recorded in those years. Gel-Del Technologies, Inc.the lower conversion rate to one share of the Company’s common stock issued and Cosmeta Corp file consolidated returns. There are penalties for not filing timely returns. These penalties have not been determined at this time, however, duethe additional interest of $25,056 which is the amount of interest credited to the operating losses, penaltiesDebenture Holders over the actual interest earned of $2,444.

Sale of Common Stock

On August 4, 2023, the Company entered into a Securities Purchase Agreement (the “Purchase Agreement”) with two accredited investors (the “Investors”), pursuant to which the Company agreed to issue and sell to the Investors in a registered direct offering (the “Registered Offering”) 1,200,002 shares (“Registered Shares”) of the Company’s common stock (the “Common Stock”) at a price of $1.50 per share. Under the Purchase Agreements, the Company also agreed to issue and sell to the Investors in a concurrent private placement (the “Private Placement,” and together with the Registered Offering, the “Offering”) warrants to purchase an aggregate of 1,200,002 shares of Common Stock (the “Warrants”). Net proceeds from the Registered Offering were $1,775,782, after deducting offering expenses of $24,218. The net proceeds were allocated between the common stock and warrants based on the relative fair values which were $502,417 and $1,273,365, respectively. The Warrants are exercisable any time on or after February 5, 2024 and prior to August 10, 2026 at an exercise price of $2.00 per share.

Common Stock

For the six months ended September 30, 2023, the Company issued 2,891,511 shares of common stock as follows: