IGC Pharma Inc

THREE MONTHS AND NINE MONTHS ENDED DECEMBER 31, 2023

(in thousands, except for share data and loss per share, unaudited)

Unless the context requires otherwise, all references in this report to“IGC,”* “the Company,” “we,” “our” and/or*“us”* refer to IGC Pharma, Inc., together with our subsidiaries and beneficially owned subsidiary. Our public filings with the Securities and Exchange Commission, the*“SEC,”* are available on www.sec.gov. The information contained on our various websites, including www.igcinc.us, is not incorporated by reference in this report, and you should not consider such information to be a part of this report. We exclude our investments and minority non-controlling interests, and any information provided by them is not incorporated by reference in this report, and you should not consider such information to be a part of this report.*

NOTE 1–** BUSINESS DESCRIPTION**

Overview

IGC Pharma is a clinical-stage pharmaceutical company developing novel therapies for Alzheimer’s disease and conditions related to the central nervous system. The company is pursuing five assets: IGC-AD1, TGR-63, LMP, IGC-1C, and IGC-M3, all of which target Alzheimer’s disease and are at various stages of development.

Our most clinically advanced investigational new drug for Alzheimer’s, IGC-AD1, has shown significant promise in preclinical studies. In Alzheimer’s cell lines, IGC-AD1 has demonstrated the potential to effectively suppress or ameliorate two key hallmarks of Alzheimer’s disease: plaques and tangles. In animal models, it has shown effectiveness in improving memory. Furthermore, in a Phase 1 multiple ascending dose (“MAD”) trial, it exhibited potential efficacy in reducing neuropsychiatric symptoms, including agitation, anxiety, and depression. IGC-AD1 is currently in a Phase 2B, multi-center, randomized, double-blind, placebo-controlled trial, specifically designed to address agitation in dementia from Alzheimer’s disease (clinicaltrials.gov, NCT05543681). Alzheimer’s impacts more than 15 million individuals in North America and Europe. The Company has 13 trial sites under contract in the US and Canada for its Phase 2B trial.

Our portfolio includes four other small molecule assets, each at distinct stages of development, all with a singular mission — to transform the landscape of Alzheimer’s treatment. LMP targets neuroinflammation, Aβ plaques, and neurofibrillary tangles, TGR-63 targets Aβ plaque, where we seek to disrupt the progression of Alzheimer’s disease. IGC-M3 targets the inhibition of Aβ plaque aggregation with the potential to create a profound impact on early-stage Alzheimer’s. IGC-1C targets tau and neurofibrillary tangles, IGC-1C represents a forward-thinking approach to Alzheimer’s therapy.

Furthermore, IGC controls a total of 21 patent filings. IGC maintains a state-of-the-art manufacturing facility in Washington State, which is poised for potential use in a Phase 3 trial and commercialization of IGC-AD1. In Bogota, Colombia, we also operate an R&D laboratory and an internal Contract Research Organization (“CRO”) that provides clinical trial services. We are actively expanding our technological capabilities with a primary focus on Generative Artificial Intelligence (“AI”) to enhance various aspects of clinical trial operations and data analysis. Our Company is investing in and pursuing AI development with an immediate focus on clinical trial processes, and analysis. Our AI initiatives are centered on informing clinical trials, developing a methodology for early detection of Alzheimer’s, and investigating the interaction of our molecules with cannabinoids.

Collectively, these core assets and initiatives underscore our commitment to advancing the field of pharmaceuticals, delivering groundbreaking treatments, and creating lasting value for our investors. We remain steadfast in our pursuit of excellence and our mission to improve the lives of those affected by Alzheimer’s and related conditions.

Our manufacturing facility is also utilized to produce women’s wellness products under the brand “Holief.” IGC Pharma is a Maryland corporation established in 2005 with a fiscal year ending on March 31, spanning a 52- or 53-week period. The Company operates in two primary business segments: Life Sciences and Infrastructure.

Life Sciences Segment

Pharmaceutical: Since 2014, the Company has focused primarily on the potential uses of phytocannabinoids, in combination with other compounds, to treat multiple diseases, such as Alzheimer’s disease. As a company engaged in the clinical-stage pharmaceutical industry, we focus our research and development efforts, subject to results of future clinical trials, on seeking pharmaceutical solutions that may a) alleviate neuropsychiatric symptoms such as agitation, anxiety, and depression associated with dementia in Alzheimer’s disease; and b) halt the onset, progression, or cure Alzheimer’s disease.

| December 31, 2023, Form 10-Q

Over-the-Counter Products: We have created a women’s wellness brand, Holief™, available through online channels that are compliant with relevant federal, state, and local laws and regulations. Holief™ is an all-natural, non-GMO, vegan, line of over-the-counter (“OTC”) products aimed at treating menstrual cramps (“dysmenorrhea”) and premenstrual syndrome (“PMS”). The products are available online and through Amazon and other online channels. In addition, we white label our product formulations to other companies that market them under their brand.

Phase 2 Clinical Trial Update

In this document, we use the terms Phase 2 and Phase 2B interchangeably, though typically, a Phase 2 trial is divided into a Phase 2A and a Phase 2B trial. Phase 2A is designed to assess dosing requirements, while Phase 2B is intended to establish efficacy. Our company has started a Phase 2B protocol called “A Phase 2, Multi-Center, Double-Blind, Randomized, Placebo-controlled trial of the safety and efficacy of IGC-AD1 on agitation in participants with dementia due to Alzheimer’s disease.” The trial is powered at 146 Alzheimer’s patients, with half receiving a placebo, and is a superior, parallel-group study.

The primary end point is agitation in dementia due to Alzheimer’s disease, as rated by the Cohen-Mansfield Agitation Inventory (“CMAI”) over a six-week period. The Phase 2 trial will also look at eleven exploratory objectives, including changes in anxiety, changes in cognitive processes such as attention, orientation, language, and visual spatial skills as well as memory, changes in depression, delusions, hallucinations, euphoria/elation, apathy, disinhibition, irritability, aberrant motor behavior, sleep disorder, appetite, quality of life, and caregiver burden. In addition, the trial will evaluate the impact of CYP450 polymorphisms and specifically CYP2C9 on each of the NPS and assess any reductions in psychotropic drugs, among others. CYP2C9 ranks amongst the most important drug metabolizing enzymes in humans, as it breaks down over 100 drugs, including nonsteroidal anti-inflammatory drugs. We seek to understand how various versions of the enzyme act on IGC-AD1. Each participant will receive two doses of IGC-AD1 (“b.i.d.”) or two doses of placebo per day for six weeks.

Infrastructure Segment

The Company’s infrastructure business has been operating since 2008. It includes (i) execution of construction contracts and (ii) rental of heavy construction equipment.

Business Organization

As of December 31, 2023, the Company had the following operating subsidiaries: Techni Bharathi Private Limited (TBL), IGCare LLC, HH Processors, LLC (formerly Holi Hemp LLC), IGC Pharma LLC, SAN Holdings LLC, Sunday Seltzer LLC, Hamsa Biopharma India Pvt. Ltd., Colombia-based beneficially-owned subsidiary IGC Pharma SAS (formerly Hamsa Biopharma Colombia SAS) and IGC Pharma IP LLC. The Company’s fiscal year is the 52- or 53-week period that ends on March 31. The Company’s principal office is in Maryland. Additionally, the Company has offices in Washington state, Colombia, and India. The Company’s filings are available on www.sec.gov. IGC Pharma, Inc. was incorporated in 2005.

NOTE 2–** SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**

Basis of presentation

The accompanying condensed consolidated Balance Sheet as of December 31, 2023, and March 31, 2023, condensed consolidated statements of operations for the three months and nine months ended December 31, 2023, and 2022, and condensed consolidated statements of cash flows for the nine months ended December 31, 2023, and 2022, are unaudited. The consolidated balance sheet as of March 31, 2023, has been derived from audited financial statements, and the accompanying as of December 31, 2023 unaudited condensed consolidated financial statements (“interim statements”) of the Company have been prepared in accordance with accounting principles generally accepted in the U.S. (“U.S. GAAP”) as determined by the Financial Accounting Standards Board (the “FASB”) within its Accounting Standards Codification (“ASC”) and under the rules and regulations of the SEC.

Accordingly, they do not include all the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments and disclosures necessary for a fair presentation of these interim statements have been included. The results reported in these interim statements are not necessarily indicative of the results that may be reported for the entire year. These interim statements should be read in conjunction with the Company’s audited consolidated financial statements for the fiscal year ended March 31, 2023 (“Fiscal 2023”) contained in the Company’s Form 10-K for Fiscal 2023, filed with the SEC on July 7, 2023, specifically in Note 2 to the consolidated financial statements.

| December 31, 2023, Form 10-Q

Principles of consolidation

The interim statements include the consolidated accounts of the Company and its subsidiaries. Intercompany accounts and transactions have been eliminated. In the opinion of Management, the interim statements reflect all adjustments, which are normal and recurring in nature, necessary for fair financial statement presentation. Transactions between the Company and its subsidiaries are eliminated in the consolidated financial statements.

Presentation and functional currencies

The Company operates in India, the U.S., Colombia, and Hong Kong, and a portion of the Company’s financials are denominated in the Indian Rupee (“INR”), the Hong Kong Dollar (“HKD”), or the Colombian Peso (“COP”). As a result, changes in the relative values of the U.S. Dollar (“USD”), the INR, the HKD, or the COP affect our financial statements.

The accompanying financial statements are reported in USD. INR, HKD, and COP are the functional currencies for certain subsidiaries of the Company. The translation of the functional currencies into USD is performed for assets and liabilities using the exchange rates in effect at the balance sheet date and for revenues and expenses using average exchange rates prevailing during the reporting periods. Adjustments resulting from the translation of functional currency financial statements to reporting currency are accumulated and reported as other comprehensive (loss), a separate component of shareholders’ equity. Transactions in currencies other than the functional currency during the year are converted into the functional currency at the applicable rates of exchange prevailing when the transactions occurred. Transaction gains and losses are recognized in the consolidated statements of operations.

Going Concern

The Company assesses and determines its ability to continue as a going concern in accordance with the provisions of ASC Subtopic 205-40, “Presentation of Financial Statements—Going Concern”, which requires the Company to evaluate whether there are conditions or events that raise substantial doubt about its ability to continue as a going concern.

The Company is currently in a clinical trial stage and, thus, has not yet achieved profitability. The Company expects to continue to incur significant operating and net losses and negative cash flows from operations in the near future.

The Company estimates that its current cash and cash equivalents balance with working capital credit facility is sufficient to support operations beyond the twelve months following the date these consolidated financial statements and footnotes were issued. These estimates are based on assumptions that may prove to be wrong, and the Company could use its available capital resources sooner than it currently expects.

Accounts receivable

We make estimates of the collectability of our accounts receivable by analyzing historical payment patterns, customer concentrations, customer creditworthiness, and current economic trends. If the financial condition of a customer deteriorates, additional allowances may be required. We had $92 thousand of accounts receivable, net of provision for the doubtful debt of $12 thousand as of December 31, 2023, as compared to $107 thousand of accounts receivable, net of provision for the doubtful debt of $17 thousand as of March 31, 2023.

Loss per share

The computation of basic loss per share for the nine months ended December 31, 2023, excludes potentially dilutive securities of approximately 9 million shares, which includes share options, unvested shares such as restricted shares and restricted share units, granted to employees, non-employees, and advisors, and shares from the conversion of outstanding units, if any because their inclusion would be anti-dilutive.

The weighted average number of shares outstanding for the nine months ended December 31, 2023, and 2022, used for the computation of basic earnings per share (“EPS”) is 57,039,035 and 52,412,830, respectively, as compared to 63,725,084 and 53,074,123 for the three months ended December 31, 2023, and 2022, respectively. Due to the loss incurred by the Company during the nine months ended December 31, 2023, and 2022, all the potential equity shares are anti-dilutive, and accordingly, the fully diluted EPS is equal to the basic EPS.

| December 31, 2023, Form 10-Q

Cybersecurity

We have a cybersecurity policy in place and have taken cybersecurity measures to safeguard against hackers, however, there can be no assurance thereof. During the nine months ended December 31, 2023, there were no impactful breaches in cybersecurity.

Revenue Recognition

The Company recognizes revenue under ASC 606,Revenue from Contracts with Customers (ASC 606). The core principle of this standard is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services.

ASC 606 prescribes a 5-step process to achieve its core principle. The Company recognizes revenue from trading, rental, or product sales as follows:

I. Identify the contract with the customer.

II. Identify the contractual performance obligations.

III. Determine the amount of consideration/price for the transaction.

IV. Allocate the determined amount of consideration/price to the performance obligations.

V. Recognize revenue when or as the performing party satisfies performance obligations.

The consideration/price for the transaction (performance obligation(s)) is determined as per the agreement or invoice (contract) for the services and products in the Infrastructure and Life Sciences segment.

Revenue in the Infrastructure segment is recognized for the renting business when the equipment is rented, and the terms of the agreement have been fulfilled during the period. Revenue from the execution of infrastructure contracts is recognized based on the output method as and when part of the performance obligation has been completed, and approval from the contracting agency has been obtained after survey of the performance completion as of that date. In the Life Sciences segment, the revenue from the wellness and lifestyle business is recognized once goods have been sold to the customer and the performance obligation has been completed. In retail sales, we offer consumer products through our online stores. Revenue is recognized when control of the goods is transferred to the customer. This generally occurs upon our delivery to a third-party carrier or to the customer directly. Revenue from white label services is recognized when the performance obligation has been completed, and output material has been transferred to the customer.

Net sales disaggregated by significant products and services for the three months and nine months ended December 31, 2023, and 2022 are as follows:

(1)Infrastructure segment consists of income from the rental of heavy construction equipment and construction contracts.

(2)Revenue from wellness and lifestyle consists of the sale of products such as gummies, hand sanitizers, bath bombs, lotions, beverages, hemp crude extract, hemp isolate, and hemp distillate.

(3)Revenue from white label services consists of rebranding our formulations or the customer’s products as per the customer’s requirement.

Recently issued accounting pronouncements

Changes to U.S. GAAP are established by the FASB in the form of accounting standards updates (“ASUs”) to the FASB’s ASC. The Company considers the applicability and impact of all ASUs. Newly issued ASUs not listed are expected to have no impact on the Company’s consolidated financial position and results of operations, because either the ASU is not applicable, or the impact is expected to be immaterial.

| December 31, 2023, Form 10-Q

NOTE 3–** INVENTORY**

During the nine months ended December 31, 2023, and 2022, the Company wrote off approximately $746 thousand and $110 thousand of inventory due to abnormal loss due to the product expiration, idle facility expense, freight, handling costs, scrap, and wasted material (spoilage). This charge was recorded in Selling, General, and Administrative Expenses.

We capitalize inventory costs related to our investigational drug, provided that management determines there is a potential alternative use for the inventory in future research and development projects or other purposes. As of December 31, 2023, and March 31, 2023, our consolidated balance sheet reported approximately $397 thousand and $407 thousand clinical trial-related inventory, respectively.

NOTE 4–** DEPOSITS AND ADVANCES**

The Advances to suppliers and consultants primarily relate to advances to vendors. Prepaid expenses and other current assets include approximately $27 thousand of statutory advances as of December 31, 2023, and approximately $25 thousand as of March 31, 2023, respectively.

NOTE 5–** INTANGIBLE ASSETS**

| December 31, 2023, Form 10-Q

The value of intangible assets includes the cost of acquiring patent rights, supporting data, and the expense associated with filing of patent applications. It also includes acquisition costs related to domains and licenses.

The intangible with finite life is up to 20 years are amortized on straight-line basis, commencing from the date of grant or acquisition. The amortization expense in the three months ended December 31, 2023, and 2022, amounted to approximately $19 thousand and $14 thousand, respectively, whereas the amortization expense in the nine months ended December 31, 2023, and 2022 amounted to approximately $55 thousand and $38 thousand, respectively.

The Company regularly reviews its intangible assets to determine if any intangible asset is other-than-temporarily impaired, which would require the Company to record an impairment charge in the period and concluded that, as of December 31, 2023, there was no impairment.

NOTE 6–** PROPERTY, PLANT, AND EQUIPMENT**

The depreciation expense in the three months ended December 31, 2023, and 2022 amounted to approximately $140 thousand and $158 thousand, respectively. The depreciation expense in the nine months ended December 31, 2023, and 2022 amounted to approximately $417 thousand and $466 thousand, respectively. The net decrease in Total property, plant, and equipment is primarily due to the impairment of land by approximately $2.6 million. During the nine months ended December 2023, the Company sold a fully depreciated property in India for net proceeds of approximately $43 thousand and accounted the same in other income. During the quarter ended December 31, 2023, the Company considered multiple alternatives to generate revenue from the land situated in Nagpur, India, and did a preliminary evaluation of the Nagpur real estate market. As a result, the Company impaired the said land comprised in the infrastructure segment by approximately $2.6 million to $1.4 million from $4.1 million to bring it closer to the fair value. For more information, please refer to Note 16 – “Segment Information” for the non-current assets other than financial instruments held in the country of domicile and foreign countries.

NOTE 7–** LEFT BLANK INTENTIONALLY**

| December 31, 2023, Form 10-Q

NOTE 8–** CLAIMS AND ADVANCES**

NOTE 9–** LEFT BLANK INTENTIONALLY**

NOTE 10–** ACCRUED AND OTHER LIABILITIES**

Compensation and other contribution-related liabilities consist of accrued salaries to employees. In addition, provision for expenses includes provision for legal, professional, and marketing expenses. Other current liability also includes statutory payables of approximately $41 thousand and $31 thousand as of December 31, 2023, and March 31, 2023, respectively, and approximately $3 thousand of short-term loans as of December 31, 2023, and March 31, 2023, respectively.

NOTE 11–** LOANS AND OTHER LIABILITIES**

Loan as of December 31, 2023:

On June 11, 2020, the Company received an Economic Injury Disaster Loan (“EIDL”) for approximately $150 thousand at an annual interest rate of 3.75%. The Company must pay principal and interest payments of $731 every month beginning June 5, 2021. The SBA will apply each installment payment first to pay interest accrued to the day the SBA receives the payment and will then apply any remaining balance to reduce the principal. All remaining principal and accrued interest is due and payable 30 years from the date of the loan. For the nine months ended December 31, 2023, the interest expense and principal payment for the EIDL were approximately $4 thousand and $2 thousand, respectively. For the nine months ended December 31, 2022, the interest expense and principal payment for the EIDL were approximately $4.1 thousand and $2 thousand, respectively. As of December 31, 2023, approximately $138 thousand of the loan is classified as Long-term loans and approximately $3 thousand as Short-term loans.

| December 31, 2023, Form 10-Q

On June 30, 2023, the Company entered into a Master Loan and Security Agreement with O-Bank, CO., LTD. (the “Credit Agreement”), pursuant to which the Company may borrow up to $12 million, which will be used to fulfill liquidity requirements and ensure the Company’s ability to sustain its operations. The Credit Agreement matures June 30, 2024, with an option to renew. Interest on borrowings will be calculated according to the interest rate stated in the Certificate of Deposit (as defined in the Credit Agreement), plus an applicable margin of 1%, and the Company will bear the tax. The Company must pay the interest in full on the last business day of each interest period. As of December 31, 2023, the Company has not yet used any of the $12 million available under the Credit Agreement.

Other Liability:

The statutory reserve is a gratuity reserve for employees in our subsidiaries in India.

NOTE 12 –** COMMITMENTS AND CONTINGENCIES**

The Company may be involved in legal proceedings, claims, and assessments arising in the ordinary course of business. Such matters are subject to many uncertainties, and outcomes are not predictable with assurance. There are no such matters that are deemed material to the condensed consolidated financial statements as of December 31, 2023, except as disclosed in the legal proceedings section below.

In the U.S., we provide health insurance, life insurance, and a 401(k) plan wherein the Company matches up to 6% of the employee’s pre-tax contribution up to a maximum annual amount determined by the IRS. In accordance with applicable laws of foreign countries, the Company provides for gratuity, a defined benefit retirement plan (“Gratuity Plan”) covering certain categories of employees. The Gratuity Plan provides a lump sum payment to vested employees, at retirement or termination of employment, an amount based on the respective employee’s last drawn salary and the years of employment with the Company. In addition, employees receive benefits from a provident fund, a defined contribution plan. The employee and employer each make monthly contributions to the plan as required by the law. The contribution is made to the Foreign Government’s funds.

NOTE 13–SECURITIES

As of December 31, 2023, the Company was authorized to issue up to 150,000,000 shares of common stock, par value $0.0001 per share, and 63,734,439 shares of common stock were issued and outstanding. The Company is also authorized to issue up to 1,000,000 shares of preferred stock, par value $0.0001 per share, andno preferred shares were issued and outstanding as of December 31, 2023.

Our common stock is listed on the NYSE American (ticker symbol: IGC). This security also trades on the Frankfurt, Stuttgart, and Berlin stock exchanges (ticker symbol: IGS1). The Company also has 91,472 units outstanding that can be separated into common stock. Ten units may be separated into one share of common stock. The unit holders are requested to contact the Company or our transfer agent, Continental Stock Transfer and Trust, to separate their units into common stock.

In November 2023, Apogee and the Company participated in a mediation and IGC paid Apogee $100,000 as part of a mutual release and settlement of all claims against each other. For more information, kindly refer to Item 1 – Legal Proceedings for more information.

| December 31, 2023, Form 10-Q

On October 27, 2023, the Company entered into a Sales Agreement (the “Agreement”) with A.G.P./Alliance Global Partners (the “Agent”) pursuant to which the Company may offer and sell, from time to time, through the Agent, as sales agent and/or principal shares of its common stock having an aggregate offering price of up to $60 million (“Shares”), subject to certain limitations on the amount of common stock that may be offered and sold by the Company set forth in the Sales Agreement (the “Offering”). Prior to entering into the Sales Agreement with A.G.P./Alliance Global Partners, the Company terminated the Sales Agreement dated January 13, 2021, with The Benchmark Company.

NOTE 14–** STOCK-BASED COMPENSATION**

As of December 31, 2023,9 million restricted share units (“RSUs”), fair valued at $5.6 million with a weighted average value of $0.64 per share, have been granted but not yet issued from different Incentive Plans and Grants. This includes 4.7 million RSUs granted to employees and directors, which consists of a vesting schedule based entirely on the attainment of both operational milestones and market conditions, assuming continued employment either as an employee or director with the Company. The performance-based RSUs are accounted upon certification by Management, confirming the probability of achievement of milestones. As of December 31, 2023, Management confirmed three of the milestones had been achieved, and the rest were considered probable to be achieved by March 31, 2028.

Additionally, options held by advisors and directors to purchase 150 thousand shares of common stock fair valued at $69 thousand with a weighted average of $0.46 per share have been granted but are to be exercised over a service period ending in Fiscal 2031. Options exercised before the service period are expensed when exercised.

The options are valued using a Black-Scholes Pricing Model and Market based RSUs are valued based on a lattice model, with the following assumptions:

The expense associated with share-based payments to employees, directors, advisors, and contractors is allocated over the vesting or service period and recognized in the Selling, General, and Administrative expenses (including research and development). For the nine months ended December 31, 2023, the Company’s share-based expense and option-based expense shown in Selling, General and Administrative expenses (including research and development) were $1.4 million and $9 thousand, respectively, and for the nine months ended December 31, 2022, the Company’s share-based expense and option-based expense was $2.2 million and $23 thousand, respectively.

| December 31, 2023, Form 10-Q

There was a combined unrecognized expense of $2.1 million related to non-vested shares and share options that the Company expects to be recognized over the weighted average life of 5 years.

NOTE 15–** FAIR VALUE OF FINANCIAL INSTRUMENTS**

As of December 31, 2023, the Company’s investments may consist of money market funds, debt and equity funds, and other marketable securities, among others, which have been classified as Level 1 of the fair value hierarchy because they have been valued using quoted prices in active markets. The Company’s cash and cash equivalents have also been classified as Level 1 on the same principle. Financial instruments are classified as current if they are expected to be liquidated within the next twelve months. The Certificates of Deposit are classified as Level 2 as they do not have regular market pricing, but their fair value can be determined based on other data values or market prices. The Company’s remaining investments have been classified as Level 3 instruments as there is little or no market data. Level 3 investments are valued using the cost method.

The following table presents information about the Company’s assets that are measured at fair value on a recurring basis as of December 31, 2023, and March 31, 2023, and indicates the fair value hierarchy of the valuation techniques the Company used to determine such fair value:

As of December 31, 2023

As of March 31, 2023

| December 31, 2023, Form 10-Q

NOTE 16–** SEGMENT INFORMATION**

FASB ASC 280, “Segment Reporting,” establishes standards for reporting information about reportable segments. Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker, or decision-making group (“CODM”), in deciding how to allocate resources and in assessing performance. The CODM evaluates revenues and gross profits based on product lines and routes to market. Based on our integration and Management strategies, we operate intwo reportable segments, the (i) Infrastructure segment and (ii) Life Sciences segment.

The Company’s CODM is the Company’s Chief Executive Officer (“CEO”). The CEO reviews financial information presented on an operating segment basis for purposes of making operating decisions and assessing financial performance. Therefore, and before our Life Sciences segment started, the Company determined that it operated in a single operating and reportable segment. As of the date of this report and in preparation for the new and different source of revenue, the Company has determined that it operates intwo operating and reportable segments, the (a) Infrastructure segment and (b) Life Sciences segment. The Company does not include intercompany transfers between segments for Management reporting purposes.

The following provides information required by ASC 280-10-50-38 “Entity-wide Information”:

For information on revenue by product and service, refer to Note 2, “Summary of Significant Accounting Policies”.

2. The table below shows the revenue attributed to the country of domicile (U.S.) and foreign countries. Revenue is generally attributed to the geographic location of customers:

| December 31, 2023, Form 10-Q

3. The table below shows the non-current assets other than financial instruments held in the country of domicile (U.S.) and foreign countries.

NOTE 17–** LEFT BLANK INTENTIONALLY**

| December 31, 2023, Form 10-Q