NOTE 8 – COMMITMENTS AND CONTINGENCIES

Leases

The Company reported the following summary of non-cancellable operating leases in accordance with the provisions of ASC 842 Topic 842 “Leases” as follows:

Summary of Non-Cancellable Operating Leases:

Vehicle 

On July 12, 2022, the Company executed a non-cancellable operating lease for a vehicle with the lease commencing on July 12, 2022 for a three-year term. The Company paid $10,000 at the execution of the lease which included $1,793 as first month payment, and $8,207 as vehicle registration, capitalized cost reduction and other handling fees. The Company recorded rent expenses of $24,254 and $24,253 for the years ended March 31, 2025 and 2024, respectively. The lease expires on July 11, 2025.

The supplemental balance sheet information related to the vehicle lease is as follows as of March 31, 2026:

As the lease does not provide an implicit rate, the Company used an incremental borrowing rate based on the information available at the lease commencement date in determining the present value of the lease payment, which is reflective of the specific term of the lease.

Anticipated future costs are as follows:

Office Lease – J Plaza

On February 2, 2026, the Company entered into a settlement agreement in the amount of $15,000 releasing itself from its contract to lease space from J Plaza at 2716 W. Olympic Blvd, Suite 209, Los Angeles, CA 90060.

On April 13, 2023, the Company executed a non-cancellable office space in a retail shopping center, for a monthly base rent of $2,196 and monthly common area maintenance charges of $1,531. The lease commenced on April 13, 2023 and extends for a term of three years and two months. The Company has an option to extend the lease for a period of 36 months after completion of the initial lease term. The Company has not included the extension period in calculating the present value of the lease as it was uncertain it would exercise the extension option. The rent is payable on the first day of each month, commencing either (1) opening of the business after tenant improvements, or (2) sixty days after the lease execution date. The Company made a payment of $8,119 of one-month rent and a security deposit of two months base rent of $4,391. The Company recorded an initial lease liability and right-of-use asset of $70,884 in 2024.

The Company recorded rent expenses including common area maintenance of $109,719 and $45,436 for the years ended March 31, 2026 and 2025, respectively.

The supplemental balance sheet information related to the office lease is as follows as of March 31, 2026:

As the lease does not provide an implicit rate, the Company used an incremental borrowing rate based on the information available at the lease commencement date in determining the present value of the lease payment, which is reflective of the specific term of the lease.

Anticipated future costs are as follows:

Office Leases - Others

On August 27, 2020, the Company formally executed a month-to-month cancellable operating lease for leasing office space in an executive suite, commencing on September 1, 2020 for $259 per month. The Company paid a security deposit of $259 on September 7, 2020. The monthly rent increased to $279 effective January 1, 2021 and then to $289 effective October 1, 2022. The Company has recorded rent expenses of $3,468 and $3,474 for the years ended March 31, 2025 and 2024, respectively.

On October 26, 2020, the Company executed a non-cancellable operating lease agreement for its principal office for a monthly rent of $5,500, with the lease commencing on November 1, 2020 for a period of 12 months. The Company paid a security deposit of $5,500 on October 28, 2020. On November 25, 2021, the Company executed a month-to-month lease for this office facility at a monthly rental of $6,500. The Company has recorded rent expenses of $78,000 and $78,000 for the years ended March 31, 2025 and 2024, respectively.

The Company has recorded total rent expense for all above leases of $151,157 and $151,163 for the years ended March 31, 2025 and 2024, respectively.

The Company has considered the provisions of ASC 842 Topic 842 “Leases”. The Company has elected not to recognize lease assets and lease liabilities for leases with a term of 12 months or less, as it is permitted to make an accounting policy election. The Company records the rent expense on a straight-line basis ratable over the term of the lease.

Employment Agreement

On March 10, 2026, the Company entered into an Employment Agreement with Nabil A. Bader which was filed on Form 8-K on March 16, 2026. Mr. Bader, has served as Executive Chairman of Executive Team Company LLC, since 2014. From 2009 to 2013, he served as Executive Chairman and Group CEO of The Mint Corporation LLC, and from 2001 to 2009; he was CEO of Workers Equity Holding LLC, a fintech company. Mr. Bader has over 30 years of management experience in the fintech industry. He attended Monterey College and Santa Monica College.

We have not yet established a formal compensation program for Mr. Bader but intend to develop one in the future.

On December 1, 2020, the Company entered into an Employment Agreement (the “Agreement”) with its President, CEO, Secretary, and Chairman (the “Officer”). The initial term of the Agreement is for three years and, if written notice is not provided within 90 days of the termination of each term, the term is automatically extended for an additional one-year term. The Agreement may be terminated by either party upon 90 days’ prior written notice. Whether the Agreement is terminated without “Cause,” for “Good Reason,” or for “Cause,” as defined in the Agreement, determines what compensation is owed and when. There is also a 30-day cure period for any termination for “Cause,” as defined in the Agreement. The Agreement contains confidentiality, non-compete, and non-solicitation provisions. Pursuant to the terms of Agreement, Mr. Koh is entitled to bonuses, reimbursement of expenses, a vehicle allowance, four weeks of paid vacation, and other incentives. The Agreement does provide for payments to be made as a result of any “Change in Control,” as defined in the agreement. Pursuant to the Agreement, the Officer is entitled to an annual base salary of $150,000 and that amount is subject to an automatic 10% annual increase on the anniversary date (See Note 7).

On March 10, 2026, James Koh resigned from his positions as President, Chief Executive Officer, Chief Financial Officer, Secretary, and Treasurer of BlueOne Technologies, Inc. He maintains his position as our Chairman of the Board of Directors.

We have not yet established a formal compensation program for Mr. Koh in his position as our Chairman but intend to develop one in the future.

Reseller Agreement with Expanse Financial Technologies, Inc. (“ExpanseFT”)

Effective February 27, 2024, the Company entered into an Authorized Reseller Agreement (the “Reseller Agreement”) with ExpanseFT (the “Program Manager”) pursuant to which the Company agreed to be a reseller or an independent sales representative of the Program Manager and its products, and the Program Manager has agreed to support our reselling efforts. The Reseller Agreement does not provide exclusivity and there are no volume sales requirements pertaining to our reselling efforts.

The term of the Reseller Agreement is for five (5) years. The Reseller Agreement is renewable by mutual consent of each of the parties for two-year terms unless either party provides written notice to the other party at least 180 days prior to the term of the Reseller Agreement. The Reseller Agreement may be terminated by either party upon a material breach of either party with the non-breaching party providing written notice to the breaching party and the breach remaining uncured with 30 days of the notice. The Reseller Agreement may also be terminated by either party by written notice if either party ceases to carry on as a going concern, becomes the object of the institution of voluntary or involuntary proceedings in bankruptcy, insolvency, or liquidation, makes an assignment for the benefit of creditors, or if a receiver is appointed with respect to all or a substantial part of its assets. The Program Manager shall provide us with prepaid debit and gift cards of requested quantity, create a range of prepaid debit accounts, using banking identification numbers provided to the Program Manager by our issuing bank and produce and deliver plastic card production tape media, including personal identification number (PIN) generation for the range of created prepaid debit accounts. Upon the first loading of value to a prepaid debit account, the Program Manager will create and activate a cardholder account on the Program Manager’s system and create linkage between the cardholder account on ExpanseFT system and our cardholder aggregate settlement account at our issuing bank or another bank.

The Company agreed to pay for all new programming outside the scope listed in this agreement such as but not limited to mobile apps, websites back office and the integrations with the sponsoring banks and processors as we go. The Company agreed to pay a one-time commitment fee of $60,000 to initiate the process to establish one banking identification number, including the program setup, integration, API connection and implementation process required to bring the program live. On March 1, 2024, the Company made a payment of $42,500 included in general and administrative expenses on the consolidated statements of operations as research and development expense for the one-time fee for program implementation to the Program Manager towards implementation and customization fees for our program. The Company has a commitment to pay an annual due diligence fee of $5,000 per card program to the Program Manager once the program takes into effect. In addition, the Company is obligated to pay a minimum monthly program management fee to the Program Manager as follows:

On February 20, 2025, the Company and ExpanseFT mutually agreed to terminate the Agreement because ExpanseFT lost its sponsor bank. Upon termination of the Agreement, Expanse FT refunded the one-time cash fee of $42,500 for program implementation and relieved the Company of all its obligations per the terms of the agreement. This refunded amount was recorded as a credit to research and development expense which is included in general and administrative expenses in the consolidated statements of operations.

Legal Costs and Contingencies

In the normal course of business, the Company incurs costs to hiring and retain external legal counsel to advise it on regulatory, litigation and other matters. The Company expenses these costs as the related services are received.

If a loss is considered probable and the amount can be reasonable estimated, the Company recognizes an expense for the estimated loss. If the Company has the potential to recover a portion of the estimated loss from a third party, the Company makes a separate assessment of recoverability and reduces the estimated loss if recovery is also deemed probable. The Company was not aware of any loss contingencies as of March 31, 2025.

Acquisition Payable

As discussed in Note 5, the acquisition payable of $500,000 was due in 90 days from the acquisition closing date which was March 13, 2025. On March 4, 2026, the $430,000 owed to Shinto Matthew was converted into equity.