My Size, Inc. 10-Q

Item 1. Financial Statements. My Size, Inc. and Subsidiaries Condensed Consolidated Interim Financial Statements As of March 31, 2025 (unaudited) U.S. Dollars in Thousands 1 MY SIZE, INC. AND ITS SUBSIDIARIES Condensed Consolidated Interim Financial Statements as of March 31, 2025 (Unaudited) Contents Page Condensed Consolidated Interim Balance Sheets (Unaudited) 3 Condensed Consolidated Interim Statements of Comprehensive Loss (Unaudited) 4 Condensed Consolidated Interim Statements of Changes in Stockholders’ Equity (Unaudited) 5 Condensed Consolidated Interim Statements of Cash flows (Unaudited) 6 Notes to Condensed Consolidated Interim Financial Statements (Unaudited) 7-13 2 MY SIZE, INC. AND ITS SUBSIDIARIES Condensed Consolidated Interim Balance Sheets (Unaudited) U.S. dollars in thousands (except share data and per share data) March 31, December 31, 2025 2024 Assets Current Assets: Cash and cash equivalents 3,695 4,880 Inventory 2,504 2,796 Account receivables 534 278 Other receivables and prepaid expenses 1,071 1,118 Total current assets 7,804 9,072 Long term deposits 7 7 Property and equipment, net 63 67 Operating right-of-use asset 18 23 Intangible assets 712 750 Goodwill 133 133 Investment in marketable securities 14 7 Total non-current assets 947 987 Total assets 8,751 10,059 Liabilities and stockholders’ equity Current liabilities: Operating lease liability 17 15 Short-term loans 77 107 Trade payables 1,588 2,084 Liabilities to related parties 72 151 Other payables 833 639 Total current liabilities 2,587 2,996 Long-term loans 133 146 Operating lease liability 2 8 Total non-current liabilities 135 154 Commitments and contingent - - Total liabilities 2,722 3,150 Stockholders’ equity: Stock Capital - Common stock of $ 0.001 par value - Authorized: 250,000,000 shares; Issued and outstanding: 2,110,748 and 2,040,159 as of March 31, 2025 and December 31, 2024, respectively 2 2 Additional paid-in capital 71,767 71,608 Accumulated other comprehensive loss ( 804 ) ( 825 ) Accumulated deficit ( 64,936 ) ( 63,876 ) Total stockholders’ equity 6,029 6,909 Total liabilities and stockholders’ equity 8,751 10,059 The accompanying notes are an integral part of the condensed consolidated interim financial statements. 3 MY SIZE, INC. AND ITS SUBSIDIARIES Condensed Consolidated Interim Statements of Comprehensive Loss (Unaudited) U.S. dollars in thousands (except share data and per share data) 2025 2024 Three-Months Ended March 31, 2025 2024 Revenues 1,479 2,984 Cost of revenues ( 1,059 ) ( 1,788 ) Gross profit 420 1,196 Operating expenses Research and development ( 82 ) ( 132 ) Sales and marketing ( 567 ) ( 1,102 ) General and administrative ( 831 ) ( 1,033 ) Total operating expenses ( 1,480 ) ( 2,267 ) Operating loss ( 1,060 ) ( 1,071 ) Financial income (expenses), net - 55 Loss before taxes ( 1,060 ) ( 1,016 ) Net loss ( 1,060 ) ( 1,016 ) Other comprehensive income (loss): Foreign currency translation differences 21 ( 107 ) Total comprehensive loss ( 1,039 ) ( 1,123 ) Basic and diluted loss per share ( 0.51 ) ( 1.88 ) Basic and diluted weighted average number of shares outstanding 2,093,949 539,042 The accompanying notes are an integral part of the interim condensed consolidated financial statements. 4 MY SIZE, INC. AND ITS SUBSIDIARIES Condensed Consolidated Interim Statements of Changes in Stockholders’ Equity (Unaudited) U.S. dollars in thousands (except share data and per share data) Number Amount capital loss deficit equity Common stock Additional paid-in Accumulated other comprehensive Accumulated Total stockholders’ Number Amount capital loss deficit equity Balance as of January 1, 2025 2,040,159 2 71,608 ( 825 ) ( 63,876 ) 6,909 Stock-based compensation related to options granted to employees and consultants 10,000 - * 22 - - 22 Issuance of shares pursuant to At The Market Offering Agreement - net of $ 5 issuance cost ** 60,589 - * 137 - - 137 Total comprehensive loss - - - 21 ( 1,060 ) ( 1,039 ) Balance as of March 31, 2025 2,110,748 2 71,767 ( 804 ) ( 64,936 ) 6,029 (*) Represents an amount less than $1. (**) See note 8 Number Amount ** capital ** loss deficit equity Common stock Additional paid-in Accumulated other comprehensive Accumulated Total stockholders’ Number Amount capital loss deficit equity Balance as of January 1, 2024 452,724 1 65,386 ( 771 ) ( 59,881 ) 4,735 Balance 452,724 1 65,386 ( 771 ) ( 59,881 ) 4,735 Stock-based compensation related to options granted to employees and consultants 80,000 - * 138 - - 138 Issuance of shares in Business Combinations 4,360 - * 3 - - 3 Exercise of warrants and prefunded warrants 104,375 - * - - - - Total comprehensive loss - - - ( 107 ) ( 1,016 ) ( 1,123 ) Balance as of March 31, 2024 641,459 1 65,527 ( 878 ) ( 60,897 ) 3,753 Balance 641,459 1 65,527 ( 878 ) ( 60,897 ) 3,753 (*) Represents an amount less than $1 5 MY SIZE, INC. AND ITS SUBSIDIARIES Condensed Consolidated Interim Statements of Cash Flows (Unaudited) U.S. dollars in thousands 2025 2024 Three-Months Ended March 31, 2025 2024 Cash flows from operating activities: Net loss ( 1,060 ) ( 1,016 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation 4 8 Change in operating lease right-of-use asset 4 98 Amortization of intangible assets 38 76 Change in liabilities to related parties ( 79 ) ( 525 ) Interest on long-term liabilities 2 8 Interest paid ( 2 ) ( 5 ) Revaluation of investment in marketable securities ( 7 ) ( 5 ) Stock based compensation 22 138 Change in inventory 331 742 Change in account receivable ( 256 ) 209 Changes in operating lease liabilities ( 1 ) ( 47 ) Change in other receivables and prepaid expenses 47 ( 150 ) Change in trade payables ( 497 ) ( 1,014 ) Change in other payables 186 66 Net cash used in operating activities ( 1,268 ) ( 1,417 ) Cash flows from investing activities: Proceeds from investment in JV - 38 Proceeds from short-term deposits - 22 Net cash provided by investing activities - 60 Cash flows from financing activities: Proceeds from issuance of shares, net of issuance costs 137 - Loans received - 500 Repayment of loans ( 42 ) ( 93 ) Net cash provided by financing activities 95 407 Effect of exchange rate fluctuations on cash and cash equivalents ( 12 ) ( 103 ) Decrease in cash, cash equivalents and restricted cash (*) ( 1,185 ) ( 1,053 ) Cash, cash equivalents and restricted cash at the beginning of the period 4,880 2,264 Cash, cash equivalents and restricted cash at the end of the period 3,695 1,211 Non cash activities: Change in operating lease right-of-use asset and liability - 181 (*) $ 1,185 relates to change in cash and cash equivalents for the three months ended March 31, 2025. The accompanying notes are an integral part of the interim condensed consolidated financial statements. 6 MY SIZE, INC. AND ITS SUBSIDIARIES Notes to Condensed Consolidated Interim Financial Statements (Unaudited) U.S. dollars in thousands (except share data and per share data) Note 1 - General a. My Size, Inc. (the “Company”) is developing unique measurement technologies based on algorithms with applications focused on the apparel e-commerce market. The technology is driven by proprietary algorithms, which are able to calculate and record measurements in a variety of novel ways. Following the acquisition of Naiz Fit Bespoke Technologies, S.L (“Naiz”) in October 2022, the Company expanded its offering outreach and customer base. Following the acquisition of Orgad International Marketing Ltd. (“Orgad”) in February 2022, the Company also operates an omnichannel e-commerce platform. The Company has six subsidiaries, My Size Israel 2014 Ltd. (“My Size Israel”), Topspin Medical (Israel) Ltd., Orgad and Rotrade Ltd., all of which are incorporated in Israel, My Size LLC, which is incorporated in the Russian Federation, and Naiz, a limited liability company incorporated under the laws of Spain. References to the Company include the subsidiaries unless the context indicates otherwise. Subsequent to the date of these financial statements, the Company established an additional subsidiary, New Percentil, S.L., a limited liability company incorporated under the laws of Spain. See note 9b. My Size, Inc., was incorporated and commenced operations in September 1999, as Topspin Medical Inc. (“Topspin”), a private company registered in the State of Delaware. In December 2013, the Company changed its name to Knowledgetree Ventures Inc. Subsequently, in February 2014, the Company changed its name to My Size, Inc. Topspin was engaged, through its Israeli subsidiary, in research and development in the field of cardiology and urology. On July 25, 2016, the Company’s common stock began publicly trading on the Nasdaq Capital Market under the symbol “MYSZ”. From September 1, 2005 to March 27, 2024, the Company’s common stock was traded on the Tel Aviv Stock Exchange. b. Since inception, the Company has incurred significant losses and negative cash flows from operations and has an accumulated deficit of $ 64,936 . The Company has financed its operations mainly through fundraising from various investors. The Company’s management expects that the Company will continue to generate losses and negative cash flows from operations for the foreseeable future. Based on the projected cash flows and cash balances as of the date of these financial statements, management is of the opinion that there is an uncertainty that its existing cash will be sufficient to fund operations for a period of more than 12 months. As a result, there is substantial doubt about the Company’s ability to continue as a going concern. Management’s plans include the continued commercialization of the Company’s products and acquisition of technology, intellectual property or businesses and securing sufficient financing through the sale of additional equity securities, debt or capital inflows from strategic partnerships. Management is actively looking for additional technology and commercial opportunities that will increase the company’s cashflow. The company has sold additional securities for $ 1,995 see note 9a. Additional funds may not be available when the Company needs them, on terms that are acceptable to it, or at all. If the Company is unsuccessful in commercializing its products and securing sufficient financing, it may need to cease operations. The financial statements include no adjustments for measurement or presentation of assets and liabilities, which may be required should the Company fail to operate as a going concern. c. In October 2023, Hamas terrorists infiltrated Israel’s southern border from the Gaza Strip and conducted a series of attacks on civilian and military targets. Hamas also launched extensive rocket attacks on the Israeli population and industrial centers located along Israel’s border with the Gaza Strip and in other areas within the State of Israel. These attacks resulted in thousands of deaths and injuries, and Hamas additionally kidnapped many Israeli civilians and soldiers. Following the attack, Israel’s security cabinet declared war against Hamas and commenced a military campaign against Hamas and other terrorist organizations in parallel to their continued rocket and terror attacks. In addition, since the commencement of these events, there have been continued hostilities along Israel’s northern border with Lebanon (with the Hezbollah terror organization;), Israel’s southern border with the Gaza Strip (with the Hamas terrorist organization) and on other fronts from various extremist groups in region, such as the Houthis in Yemen and various rebel militia groups in Syria and Iraq. Further, on April 13, 2024, and on October 1, 2024, Iran launched a series of drone and missile strikes against Israel. In November 2024, a ceasefire agreement was reached between Israel and Lebanon. The war with Hamas and Hezbollah has had an immaterial effect on its operations and financial results so far. This is attributable to its offices in Spain which has become a hub for the Company’s sizing solutions business. The majority of Orgad’s inventory utilizes fulfillment by Amazon rather than fulfilling directly. Inventory is now maintained and orders are shipped from regional Amazon warehouses, thereby reducing exposure to inventory risk and contributing to operating efficiencies. The security situation in Israel has had an immaterial effect on its operations and financial results so far. This is attributable to its global footprint and the offices in Spain, which has become a hub for the Company’s sizing solutions business. The majority of Orgad’s inventory utilizes fulfillment by Amazon rather than fulfilling directly. Inventory is now maintained in and orders are shipped from regional Amazon warehouses, thereby reducing exposure to inventory risk and contributing to operating efficiencies. On February 24, 2022, Russia invaded Ukraine. The outbreak of hostilities between the two countries could result in more widespread conflict and could have a severe adverse effect on the region. Following Russia’s actions, various countries, issued broad-ranging economic sanctions against Russia. Such sanctions included, among other things, a prohibition on doing business with certain Russian companies, officials and oligarchs; a commitment by certain countries and the European Union to remove selected Russian banks from the Society for Worldwide Interbank Financial Telecommunications (SWIFT) electronic banking network that connects banks globally; and restrictive measures to prevent the Russian Central Bank from undermining the impact of the sanctions. The Company shut down its operation in Russia and is expected to close down its subsidiary, My Size LLC, but due to technical reasons it is expected to occur in the near future. Therefore, the impact from the current situation is very limited. 7 MY SIZE, INC. AND ITS SUBSIDIARIES Notes to Condensed Consolidated Interim Financial Statements (Unaudited) U.S. dollars in thousands (except share data and per share data) Note 2 - Significant Accounting Policies a. Unaudited condensed consolidated financial statements : The accompanying unaudited condensed consolidated interim financial statements included herein have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and in accordance with the rules and regulations of the United States Securities and Exchange Commission (“SEC”). The unaudited condensed consolidated financial statements are comprised of the financial statements of the Company. In management’s opinion, the interim financial data presented includes all adjustments necessary for a fair presentation. All intercompany accounts and transactions have been eliminated. Operating results for the three months ended March 31, 2025 not necessarily indicative of the results that may be expected for any future period or for the year ending December 31, 2025. These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto for the year ended December 31, 2024. b. Significant Accounting Policies : The significant accounting policies followed in the preparation of these unaudited interim condensed consolidated financial statements are identical to those applied in the preparation of the latest annual financial statements. Note 3 – Financial Instruments The carrying amounts of cash and cash equivalents, restricted cash, accounts receivable, other receivables, trade payables, accounts payable and short and long term loans approximate their fair value due to the short-term maturities of such instruments. The Company holds share certificates My City Builders, Inc. (“MYCB”), formerly known as Diamante Minerals, Inc., a publicly traded company on the OTCQB. Due to sales restrictions on the sale of the MYCB shares, the fair value of the shares was measured on the basis of the quoted market price for an otherwise identical unrestricted equity instrument of the same issuer that trades in a public market, adjusted to reflect the effect of the sales restrictions and is therefore, ranked as Level 2 assets. Schedule of Significant Assets and Liabilities Measured at Fair Value on Recurring Basis March 31, 2025 Fair value hierarchy Level 1 Level 2 Level 3 Financial assets Investment in marketable securities (*) - 14 - 8 MY SIZE, INC. AND ITS SUBSIDIARIES Notes to Condensed Consolidated Interim Financial Statements (Unaudited) U.S. dollars in thousands (except share data and per share data) Note 3 - Financial Instruments (Cont.) December 31, 2024 Fair value hierarchy Level 1 Level 2 Level 3 Financial assets Investment in marketable securities (*) - 7 - (*) For the three-month period ended March 31, 2025 and 2024, the Company recognized gain (based on quoted market prices with a discount due to security restrictions on iMine shares) of the marketable securities was $ 7 and $ 5 respectively. Note 4 - Stock Based Compensation The stock-based expense equity awards recognized in the financial statements for services received is related to Cost of Revenues, Research and Development, Sales and Marketing and General and Administrative expenses as shown in the following table: Schedule of Stock Based Compensation Expenses 2025 2024 Three months ended March 31, 2025 2024 Stock-based compensation expense – Cost of revenues - 1 Stock-based compensation expense - Research and development 6 13 Stock-based compensation expense - Sales and marketing - 16 Stock-based compensation expense - General and administrative 16 111 Stock-based compensation expense 22 141 9 MY SIZE, INC. AND ITS SUBSIDIARIES Notes to Condensed Consolidated Interim Financial Statements (Unaudited) U.S. dollars in thousands (except share data and per share data) Note 4 - Stock Based Compensation (Cont.) Stock Option Plan for Employees: The total number of shares of common stock which may be granted to directors, officers and employees under this plan, is limited to 130,000 shares. On February 14, 2024, the Compensation Committee of the Company granted restricted common stock awards under the Company’s 2017 Equity Incentive Plan to Ronen Luzon, Oren Elmaliah and Billy Pardo, pursuant to which they were issued 37,500 restricted shares, 18,750 restricted shares and 18,750 restricted shares, respectively. The restricted shares shall vest in three equal installments on January 1, 2025, January 1, 2026 and January 1, 2027, conditioned upon continuous employment with the Company and subject to accelerated vesting upon a change in control of the Company. On the same day, the Company granted a total of 10,000 restricted stock units (“RSUs”) to its directors that will vest on January 1, 2025 and 5 five-years options to purchase up to 6,875 shares of common stock to other employees of the Company at an exercise price of $ 3.832 per share. The option vesting period is over three years in three equal portions from the vesting commencement date. The compensation cost resulting from the grant is approximately $ 314 and is expected to be recognized over a period of 3 years. The fair value of each option award is estimated on the date of grant using the Binomial option-pricing model that used the weighted average assumptions in the following table. The risk free rate for the expected term of the option is based on the U.S. Treasury yield curve in effect at the time of grant Schedule of Fair Value Assumptions of Stock Option 2024 Grants Dividend yield 0 % Expected volatility 86.22 % Risk-free interest 4.3 % Contractual term 2.0 - 2.8 During the three-month periods ended March 31, 2024, and 2025 the Company granted options, restricted stock and RSUs to purchase 10,000 and 0 shares, respectively, of common stock under the 2017 Employee Plan (as described above), respectively. No options were exercised. The total stock option compensation expense for employees during the three-month period ended March 31, 2025 and 2024 was $ 22 and $ 67 , respectively. The total stock option compensation expense relating to the Orgad acquisition during the three-month period ended March 31, 2025 and 2024 was $ 0 and $ 3 , respectively. Options issued to consultants: In July 2023, the Company entered into a six month agreement (the “Consultant Agreement”) with a consultant (the “Consultant”) to provide services to the Company, including assisting the Company to promote, market and sell the Company’s technology to potential customers and make strategic introductions and inquiries with interested parties in the financial community. Pursuant to the Consultant Agreement and in partial consideration for such consulting services, the Company issued to the Consultant (i) 5,000 shares of restricted common stock of the Company, (ii) a warrant to purchase 12,500 shares of common stock at an exercise price of $4.00 per share and exercisable for a term of 36 months from the date of issuance, and (iii) a warrant to purchase 12,500 shares of common stock at an exercise price of $6.00 per share and exercisable for a term of 36 months from the date of issuance . The issuance was approved by the Company’s board of directors in February 2024. During the three-month periods ended March 31, 2025 and 2024, the Company recorded $ 0 and $ 71 , respectively, as stock-based equity awards with respect to the Consultant. 10 MY SIZE, INC. AND ITS SUBSIDIARIES Notes to Condensed Consolidated Interim Financial Statements (Unaudited) U.S. dollars in thousands (except share data and per share data) Note 5 - Contingencies and Commitments In July 2024, the Company was served with a legal complaint filed by Shimon Shukron in the Magistrate’s Court in Herzliya for a monetary award in an amount of NIS 1,895,345 (approximately $ 510 ). The plaintiff alleges that due to the fire that broke out at Orgad’s warehouse in January 2023, the fire spread to the plaintiff’s business and caused heavy damage to the structure and contents, inventory of the business and loss of profits. The Company filed its statement of defense in September 2024. At this preliminary stage, the plaintiff did not provide sufficient documents to support his claims regarding the extent of the alleged damage. Based on the Company’s legal advisors, the Company cannot evaluate the chances of the claim to succeed, at this stage. Note 6 - Goodwill The aggregate carrying amounts of goodwill allocated to each reporting unit are as follows: Schedule of Aggregate Carrying Amount Of Goodwill 2025 2024 March 31 2025 2024 SaaS Solutions - 609 Fashion and equipment e-commerce platform 133 133 Total 133 742 11 MY SIZE, INC. AND ITS SUBSIDIARIES Notes to Condensed Consolidated Interim Financial Statements (Unaudited) U.S. dollars in thousands (except share data and per share data) Note 7 – Operating Segments The Company has the following two segments: (i) fashion and equipment e-commerce platform, and (ii) SaaS based innovative artificial intelligence driven measurement solutions. This realignment reflects the way resources are allocated and performance is assessed by the Chief Operating Decision Maker. The fashion and equipment e-commerce platform which represents Orgad’s activity that was acquired by the Company in 2022, mainly operates on Amazon. The SaaS based innovative artificial intelligence driven measurement solutions, or SaaS Solutions operating segment consists of the Company and certain of its subsidiaries, My Size Israel, My Size LLC and Naiz. The Company operating segments are the same as its reportable segments. The CODM reviews total operating expenses and consolidated net loss to assess performance, forecast future financial results, and allocate resources. In assessing the Company's financial performance and making strategic decisions, the CODM regularly reviews segment loss and operating expenses by function. This includes a review of budget versus actual expenses and cost of goods, sales and marketing salaries, and other segment expenses. For the fashion and equipment e-commerce platform operating segment, the CODM also reviews gross profit and Amazon fees. For the SaaS Solutions operating segment, the CODM also reviews research and development expenses. Revenue, costs of goods and other costs and expenses are generally directly attributed to the segments. These expenses include research and development-related expenses, costs of Amazon fees, cost of goods, and legal-related costs. Indirect costs are allocated to segments based on a reasonable allocation methodology, when such costs are significant to the performance measures of the operating segments. Indirect operating expenses, such as insurance, legal, and audit services, are mostly allocated based on revenues, most of which is allocated to the fashion and equipment e-commerce platform segment. Information related to the operations of the Company’s reportable operating segments is set forth below: Schedule of Reportable Operating Segments Fashion and equipment e-commerce platform SaaS Solutions Total As of the three months ended March 31, 2025 Revenues from external customers 1,307 172 1,479 Cost of revenues ( 1,051 ) ( 8 ) ( 1,059 ) Research and development expenses - ( 82 ) ( 82 ) Amazon fees ( 385 ) - ( 385 ) Sales and marketing Salaries ( 31 ) ( 90 ) ( 121 ) Other Segment Items (*) ( 665 ) ( 227 ) ( 892 ) Segment loss ( 825 ) ( 235 ) ( 1,060 ) Reconciliation of Profit or Loss Loss before income taxes ( 825 ) ( 235 ) ( 1,060 ) Significant non-cash items: Amortization ( 9 ) ( 29 ) ( 38 ) Share based payments ( 14 ) ( 8 ) ( 22 ) (*) Other segments items include shared based payments, rent and related expenses, professional services, insurance and other expenses. Fashion and equipment e-commerce platform Saas Solution As of March 31, 2025: Assets 6,371 2,380 Fashion and Equipment e-commerce platform SaaS Solutions Total As of the three months ended March 31, 2024 Revenues from external customers 2,807 177 2,984 Cost of revenues ( 1,766 ) ( 22 ) ( 1,788 ) Research and development expenses - ( 132 ) ( 132 ) Amazon fees ( 733 ) - ( 733 ) Sales and marketing Salaries ( 32 ) ( 129 ) ( 161 ) Other Segment Items (*) ( 858 ) ( 383 ) ( 1,241 ) Segment loss ( 582 ) ( 489 ) ( 1,071 ) Reconciliation of Profit or Loss 64 (9 ) 55 Loss before income taxes ( 518 ) ( 498 ) ( 1,016 ) Significant non-cash items: Amortization ( 27 ) ( 49 ) ( 76 ) Share based payments ( 99 ) ( 39 ) ( 138 ) (*) Other segments items include shared based payments, rent and related expenses, professional services, insurance and other expenses. Fashion and equipment e-commerce platform Saas Solution As of December 31, 2024: Assets 8,066 1,993 12 MY SIZE, INC. AND ITS SUBSIDIARIES Notes to Condensed Consolidated Interim Financial Statements (Unaudited) U.S. dollars in thousands (except share data and per share data) Note 8 – Significant events during the reporting period . On January 21, 2025, the Company entered into an At The Market Offering Agreement (the “Offering Agreement”), with H.C. Wainwright & Co., LLC (“Wainwright”), pursuant to which the Company may offer and sell, from time to time through Wainwright shares of the Company’s common stock having an aggregate offering price of up to $ 4.1 million. The Company is not obligated to make any sales of the shares under the Offering Agreement. The offering of shares pursuant to the Offering Agreement will terminate upon the earliest of (a) the sale of all of the shares subject to the Offering Agreement and (b) the termination of the Offering Agreement by Wainwright or the Company, as permitted therein. The Company agreed to pay to Wainwright a cash commission of 3% of the gross sales price of any shares of common stock sold under the Offering Agreement. As of March 31, 2025, the Company sold 60,589 shares pursuant to the Offering Agreement for aggregate gross proceeds of approximately $ 142 . Note 9 – Events subsequent to the balance sheet date a. In connection with the Offering Agreement described in note 8. As of May 15, 2025, the Company sold 992,328 shares pursuant to the Offering Agreement for aggregate gross proceeds of approximately $ 1,995 . b. On May 9, 2025, a newly-formed, wholly-owned subsidiary of the Company, New Percentil, S.L., a limited liability company incorporated under the laws of Spain (“New Percentil”), entered into a production unit transfer agreement with Casi Nuevo Kids, S.L., a limited liability company incorporated under the laws of Spain (“Casi Nuevo”), pursuant to which New Percentil acquired (the “Acquisition”) a production unit of Casi Nuevo with a trade name of Percentil that was judicially awarded to the Company in April 2025 within the framework of insolvency proceedings of Casi Nuevo filed with Commercial Court No. 13 of Madrid (Spain). The Acquisition was completed on May 9, 2025. The Company paid a total transaction value of 610 euro (approximately $ 679 ), consisting of a 40 euro (approximately $ 45 ) cash payment and the assumption of certain customer and labor liabilities and debt and social security payments in the aggregate amount of approximately 570 euro (approximately $ 634 ). The Acquisition was financed through existing cash reserves and does not involve the issuance of additional shares or debt. The initial accounting for the business combination is incomplete at the time the financial statements are issued as The acquisition was completed a few days before the filling. 13