Pluri Inc. 10-Q

Item 1. Financial Statements PLURI INC. AND ITS SUBSIDIARIES INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS As of September 30, 2025 U.S. DOLLARS IN THOUSANDS (Unaudited) INDEX Page Interim Condensed Consolidated Balance Sheets (Unaudited) 2 Interim Condensed Consolidated Statements of Operations (Unaudited) 4 Interim Condensed Consolidated Statements of Changes in Shareholders’ Deficit (Unaudited) 5 Interim Condensed Consolidated Statements of Cash Flows (Unaudited) 6 Notes to Interim Condensed Consolidated Financial Statements (Unaudited) 7 1 PLURI INC. AND ITS SUBSIDIARIES INTERIM CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) U.S. Dollars in thousands (except share and per share data) Note September 30, 2025 June 30, 2025 ASSETS CURRENT ASSETS: Cash and cash equivalents $ 4,259 $ 5,895 Short-term bank deposits 10,797 14,718 Restricted cash 428 422 Customer receivables 294 236 Prepaid expenses and other current assets 1,143 824 Total current assets 16,921 22,095 LONG-TERM ASSETS: Restricted bank deposits 909 879 Severance pay fund 654 610 Property and equipment, net 1,764 1,823 Intangible assets, net 3 2,748 2,793 Goodwill 3,136 3,136 Operating lease right-of-use asset 6,753 6,900 Other long-term assets 787 447 Total long-term assets 16,751 16,588 Total assets $ 33,672 $ 38,683 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 2 PLURI INC. AND ITS SUBSIDIARIES INTERIM CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) U.S. Dollars in thousands (except share and per share data) Note September 30, 2025 June 30, 2025 LIABILITIES AND SHAREHOLDERS’ DEFICIT CURRENT LIABILITIES Trade payables $ 877 $ 866 Accrued expenses 884 1,178 Operating lease liability 673 659 Accrued vacation and recuperation 764 859 Advances from customers 105 148 Loan from the European Investment Bank, or EIB 5 27,541 27,289 Other accounts payable 1,316 1,329 Total current liabilities 32,160 32,328 LONG-TERM LIABILITIES Accrued severance pay 723 703 Operating lease liability 6,029 6,102 Deferred tax liabilities 407 415 Total long-term liabilities 7,159 7,220 COMMITMENTS AND CONTINGENCIES 4 SHAREHOLDERS’ DEFICIT Share capital: 6 Common shares, $ 0.00001 par value per share: Authorized: 37,500,000 as of September 30, 2025, and June 30, 2025; Issued and outstanding: 8,162,707 and 7,893,767 shares as of September 30, 2025, and June 30, 2025, respectively * * Additional paid-in capital 437,545 436,213 Accumulated deficit ( 448,905 ) ( 443,055 ) Total shareholders’ deficit ( 11,360 ) ( 6,842 ) Non-controlling interests 5,713 5,977 Total deficit ( 5,647 ) ( 865 ) Total liabilities and deficit $ 33,672 $ 38,683 (*) Less than $1 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 3 PLURI INC. AND ITS SUBSIDIARIES INTERIM CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) U.S. Dollars in thousands (except share and per share data) Three months ended September 30, Note 2025 2024 Revenues $ 316 $ 326 Cost of revenues ( 201 ) ( 126 ) Gross profit 115 200 Operating expenses: Research and development expenses $ ( 3,961 ) ( 3,392 ) Less: participation by the National Institute of Allergy and Infectious Diseases, or NIAID, the Israeli Innovation Authority, or IIA, and Horizon Europe 30 503 Research and development expenses, net ( 3,931 ) ( 2,889 ) General and administrative expenses ( 2,534 ) ( 2,509 ) Operating loss ( 6,350 ) ( 5,198 ) Other financial income (expenses), net 439 ( 621 ) Interest expenses ( 229 ) ( 217 ) Total financial income (expenses), net 7 210 ( 838 ) Loss before taxes $ ( 6,140 ) ( 6,036 ) Tax benefit 8 - Net loss $ ( 6,132 ) ( 6,036 ) Net loss attributed to non-controlling interest $ ( 282 ) ( 154 ) Net loss attributed to shareholders $ ( 5,850 ) ( 5,882 ) Loss per share: Basic and diluted net loss per share $ ( 0.65 ) ( 1.08 ) Weighted average number of shares used in computing basic and diluted net loss per share 8,995,635 5,459,236 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 4 PLURI INC. AND ITS SUBSIDIARIES INTERIM CONDENSED STATEMENTS OF CHANGES IN SHAREHOLDERS’ DEFICIT (UNAUDITED) U.S. Dollars in thousands (except share and per share data) Shareholders’ Equity (Deficit) Common Shares Additional Total Non- Total Shares Amount Paid-in Capital Accumulated Deficit Shareholders’ Equity (Deficit) controlling Interests Equity (Deficit) Balance as of July 1, 2024 5,408,212 $ (* ) $ 420,568 $ ( 420,472 ) $ 96 $ 5,319 $ 5,415 Share-based compensation to employees, directors, and non-employee consultants 99,092 (* ) 503 - 503 55 558 Net loss - - - ( 5,882 ) ( 5,882 ) ( 154 ) ( 6,036 ) Balance as of September 30, 2024 5,507,304 $ (* ) $ 421,071 $ ( 426,354 ) $ ( 5,283 ) $ 5,220 $ ( 63 ) Shareholders’ Equity (Deficit) Common Shares Additional Total Non- Total Shares Amount Paid-in Capital Accumulated Deficit Shareholders’ Equity (Deficit) controlling Interests Equity (Deficit) Balance as of July 1, 2025 7,893,767 $ (* ) $ 436,213 $ ( 443,055 ) $ ( 6,842 ) $ 5,977 $ ( 865 ) Share-based compensation to employees, directors, and non-employee consultants 268,940 (* ) 1,332 - 1,332 18 1,350 Net loss - - - ( 5,850 ) ( 5,850 ) ( 282 ) ( 6,132 ) Balance as of September 30, 2025 8,162,707 $ (* ) $ 437,545 $ ( 448,905 ) $ ( 11,360 ) $ 5,713 $ ( 5,647 ) (*) Less than $1 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 5 PLURI INC. AND ITS SUBSIDIARIES INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) U.S. Dollars in thousands (except share and per share amounts) Three months ended September 30, 2025 2024 CASH FLOWS FROM OPERATING ACTIVITIES: Net loss $ ( 6,132 ) $ ( 6,036 ) Adjustments to reconcile loss to net cash used in operating activities: Depreciation and amortization 130 65 Share-based compensation to employees, directors and non-employee consultants 1,350 558 Increase in customer receivable ( 58 ) ( 26 ) Increase in prepaid expenses and other current assets and other long-term assets ( 659 ) ( 64 ) Increase in trade payables 101 150 Decrease in other accounts payable, accrued vacation and recuperation, deferred tax liabilities and accrued expenses ( 410 ) ( 98 ) Decrease in operating lease right-of-use asset and liability, net 88 87 Decrease (increase) in advances from customers ( 43 ) 47 Increase in interest receivable on short-term deposits ( 24 ) ( 39 ) Effect of exchange rate changes on cash, cash equivalents, deposits and restricted cash 1 ( 37 ) Increase in short-term interest payable and exchange rate differences related to the EIB Loan (defined below), net 252 1,338 Decrease in accrued severance pay, net ( 24 ) ( 9 ) Net cash used for operating activities $ ( 5,428 ) $ ( 4,064 ) CASH FLOWS FROM INVESTING ACTIVITIES: Purchase of property and equipment $ ( 116 ) $ ( 208 ) Proceeds from short-term deposits, net 3,966 793 Net cash provided by investing activities $ 3,850 $ 585 EFFECT OF EXCHANGE RATE ON CASH AND CASH EQUIVALENTS and restricted cash ( 22 ) 24 Decrease in cash, cash equivalents, restricted cash and restricted bank deposits ( 1,600 ) ( 3,455 ) Cash, cash equivalents, restricted cash and restricted bank deposits at the beginning of the period 7,196 7,671 Cash, cash equivalents, restricted cash and restricted bank deposits at the end of the period $ 5,596 $ 4,216 Reconciliation of cash, cash equivalents and restricted cash reported in the consolidated balance sheets: Cash and cash equivalents 4,259 3,198 Restricted cash 428 365 Long-term restricted bank deposits 909 653 Total cash, cash equivalents, restricted cash and restricted bank deposits $ 5,596 $ 4,216 (a) Supplemental disclosure of non-cash activities: Purchase of property and equipment on credit $ - $ 19 Lease liabilities arising from obtaining right-of-use assets $ 48 $ 18 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 6 PLURI INC. AND ITS SUBSIDIARIES NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) U.S. Dollars in thousands (except share and per share amounts) NOTE 1: - GENERAL a. Pluri Inc., a Nevada corporation, was incorporated on May 11, 2001. Pluri Inc.’s common shares trade on the Nasdaq Capital Market and Tel-Aviv Stock Exchange under the symbol “PLUR”. Pluri Inc. has a wholly owned subsidiary, Pluri-Biotech Ltd., or Pluri Biotech, incorporated under the laws of the State of Israel. Pluri Biotech has several subsidiaries, including: - Pluristem GmbH, or the German Subsidiary, a wholly owned subsidiary incorporated under the laws of Germany; - Ever After Foods Ltd . , or Ever After Foods, a majority-owned subsidiary, incorporated under the laws of the State of Israel; - Coffeesai Ltd., or Coffeesai, a wholly owned subsidiary, incorporated under the laws of the State of Israel; - Kokomodo Ltd., or Kokomodo, a majority-owned subsidiary incorporated under the laws of the State of Israel; and - Cellav Health and Aesthetics Ltd., a wholly owned subsidiary, incorporated under the laws of the State of Israel. Unless the context otherwise requires, the terms “Pluri”, the “Company”, “we”, “us”, and “our” refer to Pluri Inc., together with Pluri Biotech and Pluri Biotech’s subsidiaries, or, (collectively, the Subsidiaries). b. Pluri is a biotechnology company with an advanced cell-based technology platform, which operates in one operating segment. Pluri has developed a unique three-dimensional cell expansion platform, supported by an in-house, industrial-scale cell manufacturing facility registered as a manufacturer with the U.S. Food and Drug Administration (FDA), and operated in accordance with Good Manufacturing Practice, or GMP, standards, currently on a self-declared basis. Pluri utilizes its proprietary technology across the fields of regenerative medicine, aesthetics and wellness, food technology, agricultural technology and as part of its Contract Development and Manufacturing Organization, or CDMO, business. In addition, Pluri intends to expand the application of its platform to other industries and business sectors requiring scalable and cost-efficient cell expansion solutions. Pluri is dedicated to the research, development, and manufacturing of cell-based products, as well as the commercialization of cell therapeutics and related technologies aimed at delivering innovative solutions across a range of industries. c. The Company has incurred an accumulated deficit of approximately $ 448,905 and incurred recurring operating losses and negative cash flows from operating activities since inception. As of September 30, 2025, the Company’s total shareholders’ equity deficit amounted to $ 11,360 . During the three-month period ended September 30, 2025, the Company incurred losses of $ 6,132 and its negative cash flow from operating activities was $ 5,428 . The Company will be required to identify additional liquidity resources in the near term in order to support the commercialization of its products and maintain its research and development activities. As of September 30, 2025, the Company’s cash balances (cash and cash equivalents, short-term bank deposits, restricted cash and restricted bank deposits) totaled $ 16,393 . The Company is addressing its liquidity issues by implementing initiatives to allow the continuation of its activities. The Company’s current operating plan includes various assumptions concerning the level and timing of cash outflows for operating activities and capital expenditures. The Company’s ability to successfully carry out its business plan is primarily dependent upon its ability to (1) obtain sufficient additional capital, (2) enter licensing or other commercial, partnerships and collaboration agreements, (3) provide CDMO services to clients, (4) enter into agreement with EIB regarding a loan restructuring, as detailed below, and (5) receive other sources of funding, including non-dilutive sources such as grants. There is no assurance, however, that the Company will be successful in obtaining an adequate level of financing needed for the long-term development and commercialization of its products, or any financing at all. In the case that the Company is unable to obtain the required level of financing, operations may need to be scaled down or discontinued. 7 PLURI INC. AND ITS SUBSIDIARIES NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) U.S. Dollars in thousands (except share and per share amounts) NOTE 1: - GENERAL (CONT.) According to management estimates, the Company does not have sufficient resources to meet its operating obligations for at least twelve months from the issuance date of these interim unaudited condensed consolidated financial statements. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. The interim unaudited condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of assets or liabilities that might be necessary should the Company be unable to continue as a going concern. d. On April 30, 2020, the German Subsidiary entered into a finance contract, or the Finance Contract, with the EIB, pursuant to which the German Subsidiary obtained a loan in an amount of € 20 million, or the EIB Loan. The amount received is due on June 1, 2026, and bears an annual interest of 4 % to be paid with the principal of the EIB Loan. Discussions with the EIB regarding a potential restructuring of the EIB Loan, including a possible extension of its maturity date are in progress. However, there is no certainty as to the outcome of these discussions. As of September 30, 2025, the linked principal and interest accrued balance was $ 27,541 and is presented among short-term liabilities (see note 5). NOTE 2: - SIGNIFICANT ACCOUNTING POLICIES a. Unaudited Interim Financial Information The accompanying interim unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles, or U.S. GAAP, for interim financial information and with the instructions to Form 10-Q and Article 10 of U.S. Securities and Exchange Commission Regulation S-X. 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 considered necessary for a fair statement have been included (consisting only of normal recurring adjustments). For further information, reference is made to the consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended June 30, 2025. The year-end balance sheet data was derived from the audited consolidated financial statements as of June 30, 2025, but not all disclosures required by U.S. GAAP are included. Operating results for the three-month period ended September 30, 2025, are not necessarily indicative of the results that may be expected for the year ending June 30, 2026. b. Significant Accounting Policies The significant accounting policies followed in the preparation of these interim unaudited condensed consolidated financial statements are identical to those applied in the preparation of the latest annual financial statements. c. Use of estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates, judgments, and assumptions that are reasonable based upon information available at the time they are made. Estimates are primarily used for, but not limited to, percentage of completion in revenue recognition, valuation of forfeiture rate and determining the valuation of the incremental borrowing rate of the lease and terms of leases. These estimates, judgments and assumptions can affect the amounts reported in the financial statements and accompanying notes, and actual results could differ from those estimates. 8 PLURI INC. AND ITS SUBSIDIARIES NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) U.S. Dollars in thousands (except share and per share amounts) NOTE 2: - SIGNIFICANT ACCOUNTING POLICIES (CONT.) d. Fair value of financial instruments The carrying amounts of the Company’s financial instruments, including cash and cash equivalents, restricted cash, short-term bank deposits and restricted bank deposits and other current assets, trade payable and other accounts payable and accrued expenses, approximate their fair value because of their generally short-term maturities. The Company measures its derivative instruments at fair value under Accounting Standards Codification, or ASC, “Fair Value Measurements and Disclosures, or ASC 820. Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability. As a basis for considering such assumptions, ASC 820 establishes a three-tier value hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value: Level  1 - Quoted prices (unadjusted) in active markets for identical assets or liabilities; Level  2 - Inputs other than Level 1 that are observable for the asset or liability, either directly or indirectly; and Level  3 - Unobservable inputs for the asset or liability. The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The Company categorized each of its fair value measurements in one of these three levels of hierarchy. The Company measures its liability pursuant to the Finance Contract based on the aggregate outstanding amount of the combined principal and accrued interest thereunder (see note 5). The net income (losses) from derivatives instruments recognized in “Financial income (expenses), net” for the three-month period ended September 30, 2025 and 2024 were $ 289 and $ 50 , respectively (see note 7), and were classified in level 2 on the fair value hierarchy. 9 PLURI INC. AND ITS SUBSIDIARIES NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) U.S. Dollars in thousands (except share and per share amounts) NOTE 2: - SIGNIFICANT ACCOUNTING POLICIES (CONT.) e. New Accounting Pronouncements Recently issued accounting pronouncements, not yet adopted ASU No. 2023-09 - “Income Taxes (Topic 740): Improvements to Income Tax Disclosures”, or ASU 2023-09: In December 2023, the Financial Accounting Standards Board, or FASB, issued ASU 2023-09. This guidance is intended to enhance the transparency and decision usefulness of income tax disclosures. The amendments in ASU 2023-09 address investors’ requests for enhanced income tax information primarily through changes to the tax rate reconciliation and regarding income tax paid both in the U.S. and in foreign jurisdictions. ASU 2023-09 is effective for annual periods beginning after December 15, 2024, on a prospective basis. Early adoption and retroactive application are permitted. The Company is currently evaluating this guidance to determine the impact it may have on its consolidated financial statements disclosures. ASU No. 2024-03 - “Income Statement: Reporting Comprehensive Income - Expense Disaggregation Disclosures”, or ASU 2024-03: In November 2024, the FASB issued ASU 2024-03, which requires more detailed information about specified categories of expenses (purchases of inventory, employee compensation, depreciation, amortization, and depletion), which are included in certain expense captions presented on the face of the income statement, as well as disclosures about selling expenses. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and for interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. The amendments may be applied either (1) prospectively to financial statements issued for reporting periods after the effective date of ASU 2024-03, or (2) retrospectively to all prior periods presented in the financial statements. The Company is currently evaluating this guidance to determine the impact it may have on its consolidated financial statements disclosures. ASU No. 2025-05 - “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets”, or ASU 2025-05: In July 2025, the FASB issued ASU 2025-05. This amendment introduces a practical expedient for the application of the current expected credit loss model to current accounts receivable and contract assets. ASU 2025-05 is effective for fiscal years beginning after December 15, 2025, and interim reporting periods within those annual reporting periods. Early adoption is permitted. The Company is currently evaluating this guidance to determine the impact it may have on its consolidated financial statements disclosures. ASU No. 2025-07 - “Derivatives and Hedging (Topic 815) and Revenue from Contracts with Customers (Topic 606): Derivatives Scope Refinements and Scope Clarification for Share-Based Noncash Consideration from a Customer in a Revenue Contract”, or ASU 2025-07: In September 2025, the FASB issued ASU 2025-07, which refines the scope of derivative accounting under Topic 815 and clarifies the treatment of share-based noncash consideration under ASC 606. This update is effective for annual periods beginning after December 15, 2026, including interim periods within those annual periods, with early adoption permitted. Entities may apply the amendments prospectively to new contracts or retrospectively with a cumulative-effect adjustment. The Company is currently evaluating this guidance to determine the impact it may have on its consolidated financial statements. NOTE 3: - INTANGIBLE ASSETS, NET Three months ended September 30, 2025 Cost: Cocoa cell growth and application platform $ 2,685 Ability to develop additional applications 138 Total cost 2,823 Accumulated amortization: Cocoa cell growth and application platform 75 Ability to develop additional applications - Total accumulated amortization 75 Intangible assets, net $ 2,748 Amortization expenses amounted to $ 45 for the three-month period ended September 30, 2025. During the three-month period ended September 30, 2025, no impairment losses were recorded. 10 PLURI INC. AND ITS SUBSIDIARIES NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) U.S. Dollars in thousands (except share and per share amounts) NOTE 4: - COMMITMENTS AND CONTINGENCIES a. As of September 30, 2025, an amount of $ 1,337 of cash and deposits was pledged by Pluri Biotech to secure its credit line, lease agreement, derivative and hedging and bank guarantees, and by Ever After Foods to secure its lease agreement . b. Under the Law for the Encouragement of Industrial Research and Development, 1984, or the Research Law, research and development programs that meet specified criteria and are approved by the IIA are eligible for grants of up to 50 % of the project’s expenditures, as determined by the research committee, in exchange for the payment of royalties from the sale of products developed under the program. Regulations under the Research Law generally provide for the payment of royalties to the IIA of 3 % on sales of products and services derived from a technology developed using these grants until 100 % of the U.S. dollar-linked grant is repaid. The Company’s obligation to pay these royalties is contingent on its actual sale of such products and services. In the absence of such sales, no payment is required. The outstanding balance of the grants will be subject to interest at a rate equal to the 12-month secured overnight financing rate, or SOFR, applicable to U.S. dollar deposits that is published on the first business day of each calendar year. Following the full repayment of the grant, there is no further liability for royalties. As of September 30, 2025, the Company’s contingent liability in respect to royalties to the IIA amounted to $ 28,055 , not including SOFR interest as described above. c. In April 2017, the Company was awarded a Smart Money grant of approximately $ 229 from Israel’s Ministry of Economy and Industry to facilitate certain marketing and business development activities with respect to its advanced cell therapy products in the Chinese market, including Hong Kong. The Israeli government granted the Company budget resources that are intended to be used to advance the Company’s product candidate towards marketing in the China-Hong Kong markets. The Company will also receive support from Israel’s trade representatives stationed in China, including Hong Kong, along with experts appointed by the Smart Money program. As part of the program, the Company will repay royalties of 5 % of the Company’s revenues in the region for a five-year period, beginning in the year in which the Company will not be entitled to reimbursement of expenses under the program and will be spread for a period of up to 5 years or until the amount of the grant is fully paid. As of August 4, 2022, the grant from this Smart Money program received was approximately $ 180 and the program has ended. To date, no royalties were paid or accrued. d. In September 2017, the Company signed an agreement with the Tel-Aviv Sourasky Medical Center, or Ichilov Hospital, to conduct a Phase I/II trial of PLX-PAD cell therapy for the treatment of Steroid-Refractory Chronic Graft-Versus-Host-Disease, or GVHD. As part of the agreement with Ichilov Hospital, the Company will pay royalties of 1 % from its net sales of the PLX-PAD product relating to GVHD, with a maximum aggregate royalty amount of approximately $ 500 . e. As to potential royalties to the EIB, see note 5. 11 PLURI INC. AND ITS SUBSIDIARIES NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) U.S. Dollars in thousands (except share and per share amounts) NOTE 5: - LOAN FROM THE EIB On April 30, 2020, the German Subsidiary entered the Finance Contract with the EIB, pursuant to which it may obtain a loan of up to € 50 million, subject to the achievement of certain milestones. Such EIB Loan is structured to be disbursed in three tranches over a 36-month period from the date of the agreement: the first tranche of € 20 million, the second tranche of € 18 million, and the third tranche of € 12 million. The tranches were treated independently, each with its own interest rate and maturity period. The annual interest rate is 4 % (consisting of a 4 % deferred interest rate payable upon maturity); for the first tranche, 4 % (consisting of a 1 % fixed interest rate and a 3 % deferred interest rate payable upon maturity) for the second tranche and 3 % (consisting of a 1 % fixed interest rate and a 2 % deferred interest rate payable upon maturity) for the third tranche. In addition to any interest payable on the EIB Loan, the EIB is entitled to receive royalties from future revenues for a period of seven years, starting at the beginning of fiscal year 2024 and continuing up to and including its fiscal year 2030. The royalty amounts range from 0.2 % to 2.3 % of the Company’s consolidated revenues and is pro-rated to the amount disbursed under the loan. As of September 30, 2025, and June 30, 2025, the Company had an accrued royalty in the amount of $ 15 and $ 12 , respectively. During June 2021, Pluri received the first tranche in an amount of € 20 million of the Finance Contract. The amount received is due on June 1, 2026 , and bears annual interest of 4 % to be paid with the principal of the EIB Loan. As of September 30, 2025, the linked principal balance in the amount of $ 23,477 and the interest accrued in the amount of $ 4,064 are presented among short-term liabilities. Since the 36-month period of the Finance Contract has ended, the Company does not expect to receive additional funds pursuant to the Finance Contract. The Finance Contract also contains certain limitations such as the use of proceeds received from the EIB, limitations related to disposal of assets, substantive changes in the nature of the Company’s business, changes in holding structure, distributions of future potential dividends and engaging with other banks and financing entities for other loans. The Company continues to engage in discussions with the EIB regarding a potential restructuring of the EIB Loan, including a possible extension of its maturity date. However, there is no certainty as to the outcome of these discussions. NOTE 6: - SHAREHOLDERS’ EQUITY (1) On February 13, 2024 the Company entered into an Open Market Sales Agreement, or the Sales Agreement, with A.G.P./Alliance Global Partners, or A.G.P., which provides that upon the terms and subject to the conditions and limitations in the Sales Agreement, the Company may elect, from time to time, to offer and sell common shares having an aggregate offering price of up to $ 10,000 through A.G.P. acting as sales agent. As of September 30, 2025, the Company sold 42,729 common shares under the Sales Agreement at an average price of $ 5.93 per share. (2) On October 23, 2025, subsequent to the balance sheet date, 1,002,169 pre-funded warrants were exercised into 1,002,169 common shares of the Company, at a nominal exercise price of $ 0.0001 per share. (3) Share options, restricted share units, or RSUs, and restricted shares, or RS, to employees, directors and consultants: The Company adopted the 2016 Equity Compensation Plan, or the 2016 Plan, and the 2019 Equity Compensation Plan, or together, the Plans. Under the Plans, share options, RS and RSUs may be granted to the officers, directors, employees and consultants of the Company. 12 PLURI INC. AND ITS SUBSIDIARIES NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) U.S. Dollars in thousands (except share and per share amounts) NOTE 6: - SHAREHOLDERS’ EQUITY (CONT.) a. Options to non-employee consultants: A summary of the share options granted to non-employee consultants under the Plans by Pluri Inc. and Pluri Biotech is as follows: Three months ended September 30, 2025 Number Weighted average exercise price Weighted average remaining contractual terms (in years) Aggregate intrinsic value price Share options outstanding at the beginning of the period 10,755 $ 6.23 4.23 $ 24 Share options exercised ( 1,375 ) - - - Share options outstanding and exercisable at end of the period 9,380 $ 7.14 4.21 $ 14 Share options vested and exercisable at the end of the period 9,380 $ 7.14 4.21 $ 14 b. Options to the Chief Executive Officer, or CEO, and a Former Director: A summary of the share options granted to the CEO and to a former director under the Plans by Pluri Inc. and Pluri Biotech is as follows: Three months ended September 30, 2025 Number Weighted average exercise price Weighted average remaining contractual terms (in years) Share options outstanding at the beginning of the period 240,291 $ 14.82 1.42 Share options outstanding at the end of the period 240,291 $ 14.82 1.17 Share options vested and exercisable at the end of the period 240,291 $ 14.82 1.17 As of September 30, 2025, the aggregate intrinsic value of these options was $ 0 . On October 15, 2025, subsequent to the balance sheet date, the Company’s Board of Directors, or the Board, approved a grant of equity awards to the Company’s CEO, in recognition of the achievement of certain performance objectives and other accomplishments during fiscal year 2025. The approved equity awards consist of (i) 39,050 RSUs which are fully vested (see also item c), and (ii) stock options to purchase 39,050 common shares of the Company which are fully vested and exercisable for a period of three years at an exercise price of $ 5.00 per share. Since only share-based awards, rather than cash compensation, were granted for such achievement of performance objectives for fiscal year 2025, the provision previously recorded in the amount of approximately $ 41 , was reversed. The Board further approved, contingent upon the achievement of certain objectives and accomplishments by December 31, 2025, the future grant to the CEO of (i) 9,266 RSUs, and (ii) stock options to purchase 9,266 common shares of the Company. The grant date of such RSUs and stock options, if awarded, will be the date on which the applicable objectives are satisfied, and the stock options will be exercisable for three years at an exercise price of $ 5.00 per share. 13 PLURI INC. AND ITS SUBSIDIARIES NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) U.S. Dollars in thousands (except share and per share amounts) NOTE 6: - SHAREHOLDERS’ EQUITY (CONT.) c. RSUs to employees and directors: The following table summarizes the activity related to unvested RSUs granted to employees and directors under the Plans by Pluri Inc. and Pluri Biotech, for the three-month period ended September 30, 2025: Three months ended September 30, 2025 Number Unvested at the beginning of the period 634,763 Granted 20,000 Forfeited ( 16,460 ) Vested ( 91,754 ) Unvested at the end of the period 546,549 Expected to vest after the end of the period 503,173 The fair value of all RSUs was determined based on the closing trading price of the Company’s shares known at the grant date. The weighted average grant date fair value of RSUs granted during the three-month period ended September 30, 2025 to employees and directors was $ 4.89 per share. Unamortized compensation expenses related to RSUs granted to employees and directors by Pluri Inc. and Pluri Biotech are approximately $ 1,131 to be recognized by the end of September 2028. d. RSUs and RS to consultants: The following table summarizes the activity related to unvested RSUs and RS granted to non-employee consultants by Pluri Inc. and Pluri Biotech for the three-month period ended September 30, 2025: Three months ended September 30, 2025 Number Unvested at the beginning of the period 24,551 Granted 170,016 Forfeited ( 4,688 ) Vested ( 175,811 ) Unvested at the end of the period 14,068 Expected to vest after the end of the period 14,068 The fair value of all RSUs was determined based on the closing trading price of the Company’s shares known at the grant date. The weighted average grant date fair value of RSUs granted during the three-month period ended September 30, 2025 granted to non-employee consultants was $ 4.93 per share. Unamortized compensation expenses related to RSUs and RS granted to consultants by Pluri Inc. and Pluri Biotech are approximately $ 746 to be recognized by the end of February 2028. 14 PLURI INC. AND ITS SUBSIDIARIES NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) U.S. Dollars in thousands (except share and per share amounts) NOTE 6: - SHAREHOLDERS’ EQUITY (CONT.) Compensation expenses related to RSUs and RS granted by Pluri Inc. and Pluri Biotech were recorded as follows: Three months ended September 30, 2025 2024 Research and development expenses $ 122 $ 88 General and administrative expenses 497 411 $ 619 $ 499 During the three-month period ended September 30, 2025, compensation expenses related to RS granted to consultants were recorded in prepaid expenses and other current assets and in other long-term assets, were $ 371 and $ 342 , respectively. NOTE 7: - TOTAL FINANCIAL INCOME (EXPENSES), NET Three months ended September 30, 2025 2024 Foreign currency translation differences, net $ ( 43 ) $ ( 992 ) Interest income on deposits and restricted bank deposits 193 321 Income from hedging derivatives 289 50 Other financial income (expenses), net 439 ( 621 ) EIB Loan interest expenses ( 229 ) ( 217 ) $ 210 $ ( 838 ) 15 PLURI INC. AND ITS SUBSIDIARIES NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) U.S. Dollars in thousands (except share and per share amounts) NOTE 8: - SEGMENT REPORTING Segment Information Following the adoption of ASU 2023-07, the Company is required to disclose significant segment expenses that are regularly provided to the chief operating decision maker, or the CODM. As a single reportable segment entity, the Company’s segment performance measure is consolidated net loss. The Company’s CODM, the CEO , reviews the Company’s operating results on an aggregate basis and manages the Company’s operations as a single operating segment. The Company’s CODM uses consolidated net loss information to assess performance and utilizes this information in allocating resources and in assessing performance by monitoring budget versus actual results. The following table presents the significant segment expenses and other segment items regularly reviewed by the CODM: Three months ended September 30, 2025 2024 Revenues from external customers $ 316 $ 326 Salary expenses $ ( 3,375 ) $ ( 2,865 ) Professional services expenses ( 567 ) ( 666 ) Other segment items (1) ( 2,506 ) ( 2,831 ) Net loss $ ( 6,132 ) $ ( 6,036 ) Other segment disclosures: Depreciation and amortization expenses $ 130 $ 65 Share-based compensation expenses 637 558 Interest income 193 321 Interest expense 229 217 Tax benefit $ 8 $ - (1) Other segment items primarily include cost of revenues, share-based compensation expenses, depreciation and amortization expenses, other research and development expenses, other general and administrative expenses and financial income (expenses) as reported in our interim unaudited condensed consolidated statements of operations. All of the Company’s long-lived assets are located in Israel. 16 PLURI INC. AND ITS SUBSIDIARIES NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) U.S. Dollars in thousands (except share and per share amounts) NOTE 9: - BASIC AND DILUTED LOSS PER SHARE Diluted loss per share excludes 1,149,640 shares underlying outstanding warrants, 246,540 shares underlying outstanding options, and 560,617 shares underlying outstanding RSUs and RS for the three-months ended September 30, 2025, because the effect of their inclusion in the computation would be antidilutive. Diluted loss per share excludes 1,019,488 shares underlying outstanding warrants, 253,260 shares underlying outstanding options, and 303,612 shares underlying outstanding RSUs and RS for the three-months ended September 30, 2024, because the effect of their inclusion in the computation would be antidilutive. The table below shows the reconciliation of the number of shares in the computation of basic and diluted loss per share attributable to common shareholders: Three months ended September 30, 2025 2024 Numerator: Net loss attributed to shareholders $ ( 5,850 ) $ ( 5,882 ) Denominator: Common shares outstanding used in computing net loss per share attributable to common shareholders 7,990,335 5,454,730 Unexercised vested pre-funded warrants with no par value exercise price 1,002,169 - Unexercised vested options with no par value exercise price 3,131 4,506 Weighted average number of shares used in computing basic and diluted net loss per share attributable to common shareholders 8,995,635 5,459,236 Net loss per share attributable to common shareholders – basic and diluted $ ( 0.65 ) $ ( 1.08 ) 17