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Item 1A. Risk Factors

2022-11-14 compared with 2022-05-16 · 48 added, 52 removed, 8 unchanged (93% of the section changed)

RISK FACTORS.

As of the date of this

Quarterly Report on Form 10-Q, there have been no material changes to the risk factors disclosed in our Annual Report on Form 10-K filed

with the SEC on September 16, 2021, except for those included below.

Any of those risk factors could result in a significant or material

adverse effect on our results of operations or financial condition.

Additional risk factors not presently known to us or that we currently

deem immaterial may also impair our business or results of operations.

We may disclose changes to such factors or disclose additional

factors from time to time in our future filings with the SEC.

We could be party to litigation or other

legal proceedings that could adversely affect our business, results of operations and reputation.

We may be subject

to litigation and other legal proceedings that may adversely affect our business.

These legal proceedings may involve claims brought

by employees, government agencies, suppliers, shareholders or others through private actions, class actions, administrative proceedings,

regulatory actions, or other litigation.

These legal proceedings may involve allegations of illegal, unfair or inconsistent employment

practices, including wage and hour, employment of minors, discrimination, harassment, wrongful termination, and vacation and family leave

data security or privacy breaches;

violation of the federal securities laws or other concerns.

We could be involved in litigation and

legal proceedings in the future.

Even if the allegations against us in future legal matters are unfounded or we ultimately

are not held liable, the costs to defend ourselves may be significant and the litigation may subject us to substantial settlements, fines,

penalties or judgments against us and may consume management’s bandwidth and attention, some or all of which may negatively impact our

financial condition and results of operations.

Litigation also may generate negative publicity, regardless of whether the allegations

are valid, or we ultimately are liable, which could damage our reputation, and adversely impact our sales and our relationship with our

employees, clients, and guests.

failure to meet the continued listing requirements of Nasdaq could result in a delisting of our common stock, which could negatively

impact the market price and liquidity of our common stock and our ability to access the capital markets.

March 17, 2022, GBS Inc.

(the “Company”) received a letter (the “Notice”) from the Listing Qualifications Department

of The Nasdaq Stock Market LLC (“Nasdaq”) notifying the Company that the minimum closing bid price per share for its common

stock was below $1.00 for 30 consecutive business days preceding the date of the Notice, and that the Company did not meet the $1.00

per share minimum bid price requirement set forth in Nasdaq Listing Rule 5450(a)(1).

Notice has no immediate effect on the listing or trading of the Company’s common stock on the Nasdaq Global Market.

to Nasdaq Listing Rule 5810(c)(3)(A), the Company has a compliance period of 180 calendar days, or until September 13, 2022 (the “Compliance

of the date of this Quarterly Report on Form 10-Q, there have been no material changes to the risk factors disclosed in our Annual Report

on Form 10-K filed with the SEC on September 22, 2022 except for the risks described below.

Any of those risk factors could result in a significant or material adverse

effect on our results of operations or financial condition.

Additional risk factors not presently known to us or that we currently deem

immaterial may also impair our business or results of operations.

We may disclose changes to such factors or disclose additional factors

from time to time in our future filings with the SEC.

may not be able to satisfy the continued listing requirements of the Nasdaq Capital Market in order to maintain the listing of our common

March 17, 2022, the Company received a letter (the “Notice”) from the Listing

Qualifications Department of The Nasdaq Stock Market LLC (“Nasdaq”) notifying the Company that the minimum closing bid price

per share for its common stock was below $1.00 for 30 consecutive business days preceding the date of the Notice, and that the Company

did not meet the $1.00 per share minimum bid price requirement set forth in Nasdaq Listing Rule 5450(a)(1).

Notice has no immediate effect on the listing or trading of the Company’s common stock on the Nasdaq Capital Market.

to Nasdaq Listing Rule 5810(c)(3)(A), the Company had a compliance period of 180 calendar days, or until September 13, 2022 (the “Compliance

Period”), to regain compliance with Nasdaq’s minimum bid price requirement.

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Nasdaq will provide the Company a written confirmation of compliance and the matter will be closed.

the event the Company does not regain compliance by September 13, 2022, the Company may be eligible for an additional 180 calendar day

period to regain compliance.

To qualify, the Company will be required to submit, no later than the expiration date, a transfer application

and applicable fees, and meet the continued listing requirement for market value of publicly held shares and all other initial listing

standards, with the exception of the bid price requirement, and will need to provide written notice of its intention to cure the deficiency

during the second compliance period by effecting a reverse stock split if necessary.

As part of its review process, Nasdaq will make

a determination of whether it believes the Company will be able to cure the deficiency.

If Nasdaq concludes that the Company will not

be able to cure the deficiency, or if the Company determine not to submit a transfer application or make the required representation,

Nasdaq will provide notice that the Company’s securities will be subject to delisting.

If the Company chooses to implement a reverse

stock split, it must complete the split no later than ten business days prior to the expiration of the second compliance period.

September 8, 2022, the Company filed a request for a second 180-day period within which to evidence compliance with the $1.00 bid

price requirement following the expiration of the current compliance period on September 13, 2022.

No further communication has been

received from by Nasdaq as at the date of this Quarterly Report on Form 10-Q.

part of its review process, Nasdaq will make a determination of whether it believes the Company will be able to cure the deficiency.

If Nasdaq concludes that the Company will not be able to cure the deficiency, or if the Company determine not to submit a transfer application

or make the required representation, Nasdaq will provide notice that the Company’s securities will be subject to delisting.

the Company chooses to implement a reverse stock split, it must complete the split no later than ten business days prior to the expiration

of the second compliance period.

Licensor is undergoing equity recapitalization the outcome with which could materially and adversely affect our business, financial condition

and operating results.

are party to a Technology License Agreement (the “Technology License Agreement”) with Life Science Biosensor Diagnostics

(“LSBD”), pursuant to which, among other things, the Company licenses certain products from LSBD (the “Licensed

Products”), and an option agreement with LSBD and BiosensX (North America) Inc., pursuant to which, among other things, LSBD granted

to the Company an exclusive option (the “Option”) to purchase an exclusive license to use, make, sell and offer to sell products

under the intellectual property rights in connection with the Biosensor technology the glucose/diabetes management field in the United

States, Mexico and Canada.

See exhibits 10.2, exhibits 10.3, exhibits 9, 5– Technology License Agreements of the 10-K filed on

September 22, 2022 for a description of the Technology License Agreement, the Licensed Products, and the Option.

According to the Australian

Securities and Investment Commission’s (ASIC’s), Companies and Organizations Register, on May 10, 2022, LSBD filed a Notice

of Appointment of External Administrator, followed by a filing of a Deed of Company Arrangement on the August 2, 2022.

Pursuant this

filing we understand that LSBD is proposing to undergo a recapitalization of its equity structure on or before December 5, 2022.

We understand,

the Deed Administrators granted a further extension from October 2, 2022 to December 5, 2022 to the Deed Proponents to complete their

due diligence.

The terms of such recapitalization or other outcome of such administration of LSBD could result in, among other things,

change in control of the Licensor or more parties other than LSBD becoming the owner of the Intellectual Property (IP) rights.

this has an inherent risk of the possibility of modifications to, or the Company’s ability to use, the Licensed Products, which

could materially and adversely affect the Company’s business, financial condition and operating results.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

were no unregistered sales of equity securities during the period.

Other than any sales previously reported in the Company’s Current

Reports on Form 8-K, the Company did not sell any unregistered securities during the period covered by this report.

DEFAULTS UPON SENIOR SECURITIES.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1A. Risk Factors