OTC: SUND

We
currently do not hold life settlement or life insurance policies but, instead, previously held a contractual right to receive the net
insurance benefits, or “NIBs”, from a portfolio of life insurance policies held by a third party (“the Owners”
or “the Holders”). These NIBs represented an indirect, residual ownership interest in a portfolio of individual life insurance
policies, and they allowed us to receive a portion of the settlement proceeds from such policies, after expenses related to the acquisition,
financing, insuring and servicing of the policies underlying our NIBs have been paid.

NIBs
are generally sold by an entity that holds the underlying life settlement or life insurance policies, either directly or indirectly through
a subsidiary, such an entity is referred to herein as a “Holder.” A Holder, directly or through a wholly owned subsidiary,
purchases life insurance policies from the insured or on the secondary market and aggregates them into a portfolio of policies. At the
time of purchase, the Holder also (i) contracts with a service provider to manage the servicing of the policies until maturity, (ii)
considers purchasing mortality re-insurance (“MRI”) coverage under which payments will be made to the Holder in the event
the insurance policies do not mature according to actuarial life expectancies, and (iii) arranges financing to cover the initial purchase
of the insurance policies, the servicing of the life insurance policies until maturity and the payment of the MRI premiums. The financing
obtained by the Holder for a portfolio of life settlement or life insurance policies is secured by the insurance policies for which the
financing was obtained. After a Holder purchases policies, aggregates them into a portfolio and arranges for their servicing, MRI coverage
and financing, then the Holder contracts to sell NIBs related to the policies, which gives the holder of the NIBs the right to receive
the proceeds from the settlement of the insurance policies after all of the expenses related to such policies have been paid. When an
insurance policy underlying our NIBs comes to maturity, the insurance proceeds are first used to pay expenses associated with such policy.
Once all of the expenses have been paid, the Holder will retain a small percentage of the proceeds and then will pay us for the remaining
insurance proceeds.

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During
the latter part of the fiscal year ended March 31, 2021, we began developing an additional business offering, providing professional
services to specialty structured finance groups, bond issuers and life settlement aggregators. We have assembled an experienced team
from the life settlement marketplace, as well as from other areas such as financial services and public financial markets. As a professional
services provider, we apply industry best practices to advise on the selection of specific portfolios of life insurance policies that
are tailored to meet the needs of its clients. Our clients may include bond issuers, bond investors, or other structured finance product
issuers. We develop strategies and methodologies which include the acquisition of life insurance portfolios, then use common structured
finance techniques and proprietary analytics to structure bonds for issuances, including principal protected bonds. Our goal is to deliver
long-term value and profitability to shareholders by growing our professional services business and asset base, resulting in the ability
to pay dividends to its shareholders.

During
the latter part of the year ended March 31, 2021, we began working closely with bond placement agents and aggregators to establish various
aspects of a proprietary, investment grade bond offering. In this arrangement, we participate as the sole originator in the role of structuring
and advising on the structure of the proprietary bond instrument. Included in the role of structuring financial assets, we use proprietary
analytics to establish the makeup of the rated instrument, including but not limited to life settlement assets (life insurance policies)
and managed cash, and implement a process of selective assembly of the underlying assets and cash management that will meet the policy
requirements and analytics. We provide current and ongoing resources for all analytics, as well as advisement support for the investment
and non-investment grade ratings for the managed asset pool and the managed cash accounts. In our advisory role, we are reimbursed for
all expenses associated with the structuring and preparation of any bond offering, will receive an advisory payment upon the closing
of any bond offering, and then will hold residual rights on the balance of assets once the bond is retired.

Life
Settlements Market

There
are a number of reasons a policy owner may choose to sell his or her life insurance policy. The policy owner may no longer need or want
his or her policy, he or she may wish to purchase a different kind of insurance policy, premium payments may no longer be affordable
or the policy owner may need cash to fund healthcare or other expenses. In particular, policy holders 65 years of age and older and their
families are faced with a variety of challenges as they seek to address their post-retirement financial needs and selling one’s
life insurance policy may provide a unique and valuable financial solution to such challenges. From the early 2000s through 2008, the
market for newly originated life settlements grew from virtually no activity to a peak of an estimated $12 billion of face value of U.S.
life settlement policies settled annually in 2007 and 2008. Economic factors slowed the growth in 2009, when an estimated $8 billion
of face value of U.S. life insurance was settled and growth has continued to decline since that time. Participants in the secondary life
settlement market have included major insurance companies which have purchased available pools of policies for their own investment,
portfolio aggregators, private equity funds, and independent third-party investors.

Predictability
of Future Cash Flows. Predictability of future cash flows is one of the biggest challenges facing companies engaged in the life
settlements industry. If a Holder is not able to adequately predict future cash flows and does not continually have enough cash to make
a policy portfolio’s premium payments, the policies in the portfolio may lapse and we may lose our right to receive the proceeds
from the settlement of the policies at maturity. Prediction of future cash flow requires the use of financial models, which rely on various
assumptions. These assumptions include the amount and timing of projected net cash receipts, expected maturity events, counterparty performance
risk, changes to applicable regulation of the investment, shortage of funds needed to maintain the asset until maturity, changes in discount
rates, life expectancy estimates and their relation to premiums, interest, and other costs incurred, among other items. These uncertainties
and contingencies are difficult to predict and are subject to future events that may impact our estimates and interest income. As a result,
actual results could differ significantly from those estimates. If projections of life expectancies are wrong, Holders may be obligated
to service the related insurance policies for longer than expected, thereby increasing their costs and reducing the net insurance benefit
available.

Financing
a portion of the purchase price. Financing a portion of the purchase price of a policy portfolio allows the Holder to leverage
its investment and create a larger and diversified policy portfolio. When making an investment in a portfolio of life insurance policies,
a Holder utilizes actuarial tables to determine when the policies in the portfolio can be expected to come to maturity. However, the
Holder assumes the risk that the policies in the portfolio will come to maturity later than was predicted by the actuarial tables used
at the time of purchase. The life expectancies provided by the actuarial tables are based on actual death rates in large populations
of individuals with similar demographic characteristics. Thus, the more policies underlying a policy portfolio, the more reliable the
use of actuarial tables becomes. In other words, the larger the policy portfolio, the more closely the underlying insureds would be expected
to, on average, follow actuarial predictions and the lower the risk associated with future cash flows will be. Because of the general
uncertainty of maturity of life insurance policies, financing for their purchase and servicing has historically been difficult to secure.
The lender (the “Holders’ Lender”) has provided funding to the Holders to finance the purchase of the insurance policies.
We believe there are few lenders within this market.

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Mortality
Re-Insurance (MRI) Coverage. Because of the uncertainty of maturity of insurance policies the Holders had, on occasion, previously
contracted with an insurance provider for MRI coverage. MRI coverage typically provides guaranteed cash flow based on the expected death
benefits of the pool of policies being insured calculated at the issuance of the coverage, thereby providing credit enhancement to any
bank providing financing to a Holder. The term of the MRI policies is usually 15 years. Any claims paid by the MRI to the Holder must
be paid back to the MRI provider out of death benefit proceeds from the pool of policies being insured when such death benefit proceeds
are eventually received. This enables the Holder to receive a smoother cash flow from a pool of policies over time and avoid “lumpiness”
in the cash flows that would otherwise be more pronounced in the absence of the MRI coverage. Any claim payment balances would accrue
interest, typically at a spread of 250 basis points over LIBOR, to the extent they remain outstanding. The MRI coverage is obtained by
paying an MRI premium, typically equal to 2% of the cumulative death benefit of the covered life insurance policies, at the outset of
the coverage and, depending on the specific terms of the MRI policy, possibly an additional premium amount at a predetermined time during
the effective coverage period (the “Commitment Fee”), which is typically 1% of the cumulative death benefits of the covered
policies. The insurer under the MRI policy typically must approve the sale of any life insurance policies covered by the MRI policy if
such sale does not result in the full repayment of any outstanding recovery amounts. It is our understanding that there is only one MRI
Provider. While the MRI coverage is relatively expensive, we believe that insurance policies that MRI covers have less volatility, are
more liquid and should achieve higher values for purposes of financing and secondary market sales.

Financing
a policy portfolio’s premium payments gives a Holder additional cash needed to satisfy the premium obligations of its portfolio.
In addition, obtaining an MRI increases the probability that the Holder will receive future cash flows in the event that the underlying
insureds live longer than expected. This combination provides the Holder with sufficient liquidity to stabilize its cash position.

Life
Settlement Purchasing Guidelines as an Advisor

Our
objective is to advise and assist entities as they acquire life insurance policies and portfolios that will produce returns in excess
of all purchase, financing, servicing and insuring costs incurred by the Holder. The guidelines we generally follow regarding the purchase
of policies and portfolios include:

●
the
insured is 75 years old or older;

●
all
NIBs relate to U.S. Universal Life Insurance policies;

●
all
underlying insurance policies have qualified for financing that will cover at least four years of premiums;

●
each
policy must first be reviewed by the legal due diligence team of the lender providing financing for the acquisition and servicing
of the life insurance policies, second by the MRI company’s due diligence team and then finally approved by our due diligence
processes;

●
all
policies must qualify for MRI; and

●
the
projected proceeds payable on each life insurance policy upon the death of the underlying insured are projected to exceed the costs
to service the life insurance policies, amounts due to creditors secured by such life insurance policy, such as the Holders’
Lender or the MRI provider, other costs and fees incurred by the Holder and the percentage of the remaining insurance benefit retained
by the Holder

Competition

We
encounter significant competition in the life settlements industry generally from numerous companies, including hedge funds, investment
banks, secured lenders, specialty life insurance finance companies and life insurance companies themselves who purchase life settlements.
Many of these competitors have greater financial and other resources than we do and may have a significantly lower cost of funds because
they have greater access to insured deposits or the capital markets. Moreover, some of these competitors have significant cash reserves
and can better fund shortfalls in collections that might have a more pronounced impact on companies such as ours. They also have greater
market share. For example, Berkshire Hathaway purchased a portfolio of $300 million (face value) in life insurance policies in 2013.
According to The Deal Pipeline, total life settlement transactions grew to $2.57 billion (face value) in 2013. In 2014 transaction volumes
were reported higher by market participants in all major segments of the industry and Conning & Co. forecast an average annual gross
market potential for life settlements of $180 billion from 2014-2023, with an average volume of approximately $3 billion per year in
life settlement transactions.

A
report from the AAP Life Settlement Market Update indicated that internal rates of return for life settlement transactions conducted
in 2013 were in the high teens, an attractive return at a time when fixed income and other hedge positions were delivering minimal rates
of return. If certain better-financed companies make a significant effort to compete against our business or the secondary market in
general, prices paid for existing portfolios of life insurance policies may rise and our ability to purchase satisfactory assets may
decline. In addition, recent shrinking of the market for life settlements has resulted in fewer available pools of insurance policies.
As a result, price competition for the remaining pools has increased. Our limited resources prohibit us from competing for larger pools.
These factors could adversely affect our profitability by reducing our return on investment or increasing our risk.

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Employees

On
March 31, 2026, we had one full-time employee: Randall F. Pearson, our President.

Available
Information

Our
website address is www.sundancestrategies.com. We make available free of charge on the Financials portion of our website, our annual
reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished
pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 as soon as reasonably practicable after we electronically file
such material with, or furnish it to, the Securities and Exchange Commission.