What changed in this filing

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Item 1. Financial Statements

2021-05-13 compared with 2020-11-09 · 330 added, 406 removed, 298 unchanged (71% of the section changed)

1 unchanged sentence

(Formerly known as Virtual Crypto Technologies, Inc.)

STATEMENTS (UNAUDITED)

Condensed Consolidated Balance Sheets As Of September 30, 2020 (Unaudited) and December 31, 2019

Condensed Consolidated Statements of Comprehensive Loss for the Nine and Three Months ended September 30, 2020 and 2019 (Unaudited)

Condensed Consolidated Statements of Changes in Temporary Equity and Stockholders’

Deficit for the Nine and Three Months Ended September 30, 2020 and 2019 (Unaudited)

Condensed Consolidated Statements of Cash Flows for Nine and Three Months Ended September 30, 2020 and 2019 (Unaudited)

CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Condensed Consolidated Balance Sheets for the and Three Months ended March 31, 2021 (Unaudited) and Year Ended December 31, 2020

Condensed Consolidated Statements of Comprehensive Loss for the Three Months ended March 31, 2021 and 2020 (Unaudited)

Condensed Consolidated Statements of Changes in Stockholders’

Deficit for the Three Months Ended March 31, 2021 and 2020 (Unaudited)

Condensed Consolidated Statements of Cash Flows for Three Months Ended March 31, 2021 and 2020 (Unaudited)

Notes to Condensed Consolidated Financial Statements

(Formerly known as Virtual Crypto Technologies, Inc.)

CONSOLIDATED BALANCE SHEETS (Unaudited)

dollars in thousands (except share data)

As of March 31

As of December 31

CURRENT ASSETS

Cash and cash equivalents

Restricted cash

Trade receivables

Other accounts receivable

Prepaid expenses

Other accounts receivables

Total current assets

NON CURRENT ASSETS

Property and equipment, net

Total non-current assets

accompanying notes are an integral part of these condensed consolidated financial statements.

(Formerly known as Virtual Crypto Technologies, Inc.)

BALANCE SHEETS (Unaudited) (Cont.)

dollars in thousands (except share data)

As of March 31

As of December 31

LIABILITIES AND STOCKHOLDERS’

1 unchanged sentence

Trade payables

Payable to parent company

Other accounts payables and accrued liabilities

Payable to parent company

Short term loan

Total current liabilities

6 unchanged sentences

34,753,669 shares as of December 31, 2020;

and September 30, 2020

and March 31, 2021

Additional paid-in capital

3 unchanged sentences

accompanying notes are an integral part of these condensed consolidated financial statements.

(Formerly known as Virtual Crypto Technologies, Inc.)

AND ITS SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Unaudited)

dollars in thousands (except share data)

For the nine months

ended September 30

For the three months

ended September 30

For the three months ended March 31

Cost of revenues

5 unchanged sentences

Operating loss

Financial expenses (income), net

Financial income (expenses) ,

Loss before tax

1 unchanged sentence

Loss per share - basic and diluted

Weighted average number of ordinary shares outstanding used in the computations of loss per share

Weighted average number of ordinary shares outstanding used in the computations of loss per share (in thousands) (*)

accompanying notes are an integral part of these condensed consolidated financial statements.

(Formerly known as Virtual Crypto Technologies, Inc.)

STATEMENTS OF CHANGES IN TEMPORARY EQUITY AND STOCKHOLDERS’

STATEMENTS OF CHANGES IN STOCKHOLDERS’

DEFICIT (Unaudited)

5 unchanged sentences

Net loss for the period

Balance as of September 30, 2020

Balance as of March 31, 2021

Ordinary shares

1 unchanged sentence

Total shareholders’

Balance as of June 30, 2020

Balance as of January 1, 2020

Net loss for the period

Balance as of September 30, 2020

shareholders’

as of January 1, 2019

loss for the period

as of March 31, 2019

loss for the period

as of June 30, 2019 (unaudited)

of reverse recapitalization

loss for the period

as of September 30, 2019 (unaudited

an amount less than $ 1.

number of shares prior to the reverse recapitalization have been retroactively adjusted based on the equivalent number of

shares received by the accounting acquirer in the Recapitalization Transaction.

Refer to Note 1 for further information.

Balance as of March 31, 2020

accompanying notes are an integral part of these condensed consolidated financial statements.

(Formerly known as Virtual Crypto Technologies, Inc.)

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

dollars in thousands (except share data)

For the nine months

ended September 30

For the three months

ended September 30

For the three months ended March 31

Cash flows from operating activities

Net loss for the period

Adjustments to reconcile net loss to net cash provided by (used in) operating activities:

Adjustments to reconcile net loss to net cash provided by (used in)

operating activities:

Gain from sale of a subsidiary

Changes in assets and liabilities:

Decrease in prepaid expenses

Changes in current assets and liabilities:

Decrease in trade receivables and prepaid expenses

Decrease in other receivables

Increase (decrease) in trade payables

Increase (decrease) in other accounts payables

Increase in trade payables

Financing expenses from short-term loans

decrease in other accounts payables and accrued liabilities

Increase in payable to parent company

1 unchanged sentence

Cash flows from investing activities

Purchase of property and equipment

Proceeds from sale of property and equipment

Net cash used in investing activities

Cash flows from investing activities

Cash received from sale of a subsidiary

Cash acquired in connection with the reverse recapitalization

Net cash provided by Investing activities

Increase (decrease) in cash and cash equivalents and restricted cash

Cash and cash equivalents and restricted cash at the beginning of the period

Cash and cash equivalents and restricted cash at the end of the period

accompanying notes are an integral part of these condensed consolidated financial statements.

(Formerly known as Virtual Crypto Technologies, Inc.)

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

dollars in thousands (except share data)

Cash and cash equivalents and restricted cash at the beginning of the year

Cash and cash equivalents and restricted cash at the end of the year

Cash Flow Information:

As of February 31

Current assets excluding cash and cash equivalents

3 unchanged sentences

accompanying notes are an integral part of these condensed consolidated financial statements.

(Formerly known as Virtual Crypto Technologies, Inc.)

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

Organizational Background

(formerly known as Virtual Crypto Technologies, Inc.) (the “Company”) was incorporated in the State of Ohio in 1989 under a predecessor name, Zaxis International, Inc.

Organizational

(formerly known as Virtual Crypto Technologies, Inc.) (the “Company”) was incorporated in the State of Ohio in

1989 under a predecessor name, Zaxis International, Inc.

(“Zaxis”).

On August 25, 1995, Zaxis merged with a subsidiary of The InFerGene Company, a Delaware corporation, which entity changed its name to Zaxis International, Inc.

and the Company was reincorporated in Delaware under the name of Zaxis International, Inc.

On December 30, 2014, Zaxis entered into an agreement with Emerald Medical Applications Ltd., a private limited liability company organized under the laws of the State of Israel (“Emerald Israel”).

Emerald Medical Applications Ltd.

On March 16, 2015, Zaxis and Emerald Israel

executed a share exchange agreement, which closed on July 14, 2015, and Emerald Israel became the Company’s wholly-owned

Emerald Israel was engaged in the business of developing Emerald Israel’s DermaCompare technology and the development,

sale and service of imaging solutions utilizing its DermaCompare software for use in derma imaging and analytics for the detection

of skin cancer.

On January 29, 2018, the Company ceased the DermaCompare operations of its former subsidiary.

On May 2, 2018, the District Court of Lod,

Israel issued a winding-up order for Emerald Israel and appointed an Israeli attorney as special executor for Emerald Israel.

Virtual Crypto Technologies Ltd.

On January 17, 2018, the Company formed a new

wholly-owned subsidiary under the laws of the State of Israel, Virtual Crypto Technologies Ltd.

(the “VCT Israel”),

to develop and market software and hardware products facilitating, allowing and supporting purchase and/or sale of cryptocurrencies

through ATMs, tablets, personal computers (“PCs”) and/or mobile devices.

VCT Israel ceased its business operation

during the beginning of Q1 2020.

On January 27, 2020, VCT Israel was sold to a third party for NIS 50 ($14).

effective closing date of the transaction was February 12, 2020.

The gain from the sale of the company was $ 8.

(Formerly known as Virtual Crypto Technologies, Inc.)

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

1 - GENERAL (Cont.)

Transaction with Gix Internet Ltd.

(formerly known as Algomizer Ltd.), or Gix (the “Recapitalization Transaction”)

On June 6, 2020,

Algomizer changed its name to Gix Internet Ltd., or Gix.

On February 7, 2019, the Company entered into a share exchange agreement (the “Share Exchange Agreement”) with Gix Internet Ltd.

(TASE:ALMO), a company organized under the laws of the State of Israel (“Gix”), pursuant to which on July 25, 2019 (the “Closing Date”), Gix assigned, transferred and delivered its 99.83% holdings in Viewbix Ltd.

(“Viewbix Israel”) to the Company in exchange for shares of restricted common stock of the Company, representing 65% of the issued and outstanding share capital of the Company on a fully diluted basis as of the Closing Date following the conversion of certain convertible notes of the Company and excluding certain warrants to purchase shares of the Common Stock expiring in 2020 and additional warrants as further described below (the “Fully Diluted Share Capital”).

On August 25, 1995, Zaxis merged with a subsidiary

of The InFerGene Company, a Delaware corporation, which entity changed its name to Zaxis International, Inc.

and the Company was

reincorporated in Delaware under the name of Zaxis International, Inc.

On December 30, 2014, Zaxis entered into an agreement with

Emerald Medical Applications Ltd., a private limited liability company organized under the laws of the State of Israel (“Emerald

Israel”).

June 6, 2020, Algomizer changed its name to Gix Internet Ltd., or Gix.

February 7, 2019, the Company entered into a share exchange agreement (the “Share Exchange On February 7, 2019, the Company

entered into a share exchange agreement (the “Share Exchange Agreement”) with Gix Internet Ltd.

(TASE:ALMO), a company

organized under the laws of the State of Israel (“Gix”), pursuant to which on July 25, 2019 (the “Closing Date”),

Gix assigned, transferred and delivered its 99.83% holdings in Viewbix Ltd.

(“Viewbix Israel”) to the Company in exchange

for shares of restricted common stock of the Company, representing 65% of the issued and outstanding share capital of the Company

on a fully diluted basis as of the Closing Date following the conversion of certain convertible notes of the Company and excluding

certain warrants to purchase shares of the Common Stock expiring in 2020 and additional warrants as further described below (the

“Fully Diluted Share Capital”).

In addition, upon the earlier of:

(a) the launch of a live video product to an American consumer in the United States by Viewbix Israel, or (b) the launch of an interactive television product to an American consumer in the United States by Viewbix Israel, the Company will issue to Gix an additional 1,642,193 shares of restricted common stock of the Company representing 5% of the Fully Diluted Share Capital immediately following the Closing Date.

On July 24, 2019, the Company filed a Certificate of Amendment to its Certificate of Incorporation with the Secretary of State of Delaware reflecting its name change from Virtual Crypto Technologies, Inc.

(a) the launch of a live video product to an American

consumer in the United States by Viewbix Israel, or (b) the launch of an interactive television product to an American consumer

in the United States by Viewbix Israel, the Company will issue to Gix an additional 1,642,193 shares of restricted common stock

of the Company representing 5% of the Fully Diluted Share Capital immediately following the Closing Date.

July 24, 2019, the Company filed a Certificate of Amendment to its Certificate of Incorporation with the Secretary of State of

Delaware reflecting its name change from Virtual Crypto Technologies, Inc.

to Viewbix Inc.

to reflect its new operations and business focus and, effective on August 7, 2019, FINRA approved the Registrant’s name change and its trading symbol was changed from “VRCP”

to reflect its new operations and business

focus and, effective on August 7, 2019, FINRA approved the Registrant’s name change and its trading symbol was changed from

“VRCP”

to “VBIX”

on the OTCQB.

On the Closing Date, the Company (i) issued 20,281,085 shares of its common stock to Gix in exchange for consideration consisting of consideration for its 99.83% holdings in Viewbix Israel, and (ii) 3,434,889 shares of its common stock to holders of convertible notes, which were issued by the Company prior to the Reverse Recapitalization, and which were converted upon the Closing Date.

the Closing Date, the Company (i) issued 20,281,085 shares of its common stock to Gix in exchange for consideration consisting

of consideration for its 99.83% holdings in Viewbix Israel, and (ii) 3,434,889 shares of its common stock to holders of convertible

notes, which were issued by the Company prior to the Reverse Recapitalization, and which were converted upon the Closing Date.

The shares of common stock were issued under Regulation S.

The Company also issued a total of 7,298,636 warrants to Gix to purchase the Company’s common stock, whereby (i) 3,649,318 of such warrants were issued with an exercise price of $0.48, and (ii) 3,649,318 of such warrants were issued with an exercise price of $0.80.

(Formerly known as Virtual Crypto Technologies, Inc.)

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

1 - GENERAL (Cont.)

with Gix Internet Ltd.

(formerly known as Algomizer Ltd.), or Gix (the “Recapitalization Transaction”):

The Company also issued a total of 7,298,636 warrants to Gix to purchase

the Company’s common stock, whereby (i) 3,649,318 of such warrants were issued with an exercise price of $0.48, and (ii)

3,649,318 of such warrants were issued with an exercise price of $0.80.

a result of the Recapitalization Transaction, Viewbix Israel became a subsidiary of the Company.

2 unchanged sentences

in the Recapitalization Transaction.

As a result, the historical financial statements of the Company were replaced with the

historical financial statements of Viewbix Israel.

The number of shares prior to the reverse recapitalization have been retroactively

adjusted based on the equivalent number of shares received by the accounting acquirer in the Recapitalization Transaction.

As a result, the historical financial statements of the Company were replaced with the historical

financial statements of Viewbix Israel.

The number of shares prior to the reverse recapitalization have been retroactively adjusted

based on the equivalent number of shares received by the accounting acquirer in the Recapitalization Transaction.

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

Organizational

Background (Cont.)

Company and its subsidiaries are collectively referred to as the “Company”.

Viewbix Israel was incorporated on

February 2006 in Israel.

The Company has developed an interactive video platform based on Software as a Service (“SaaS”)

business model with interactive elements, and the ability to collect and analyze information about each interactive action

performed during the viewing of the video clip.

The interactive elements and information gathered, allowing the advertiser

to analyze user viewing habits and optimize real-time throughout the campaign while increasing the effectiveness of online

and live video advertising.

Viewbix Israel was incorporated on February

2006 in Israel.

The Company has developed an interactive video platform based on Software as a Service (“SaaS”) business

model with interactive elements, and the ability to collect and analyze information about each interactive action performed during

the viewing of the video clip.

The interactive elements and information gathered, allowing the advertiser to analyze user viewing

habits and optimize real-time throughout the campaign while increasing the effectiveness of online and live video advertising.

January 1, 2020, the Company announced certain cost reduction measures due the Company not achieving certain revenues goals.

Company has incurred $311 in net loss for the nine months period ended September 30, 2020, has $2,004 stockholders’

deficit as of September 30, 2020 and $1,693 in total stockholders’

deficit as of December 31, 2019 .Management expects

the Company to continue to generate substantial operating losses and continue to fund its operations primarily through utilization

of its current financial resources and through additional raises of capital.

Medical Applications Ltd.

March 16, 2015, Zaxis and Emerald Israel executed a share exchange agreement, which closed on July 14, 2015, and Emerald Israel

became the Company’s wholly-owned subsidiary.

Emerald Israel was engaged in the business of developing Emerald Israel’s

DermaCompare technology and the development, sale and service of imaging solutions utilizing its DermaCompare software for use

in derma imaging and analytics for the detection of skin cancer.

On January 29, 2018, the Company ceased the DermaCompare operations

of its former subsidiary.

` 2, 2018, the District Court of Lod, Israel issued a winding-up order for Emerald Israel and appointed an Israeli attorney

as special executor for Emerald Israel.

Crypto Technologies Ltd.

January 17, 2018, the Company formed a new wholly-owned subsidiary under the laws of the State of Israel, Virtual Crypto Technologies

(the “VCT Israel”), to develop and market software and hardware products facilitating, allowing and supporting

purchase and/or sale of cryptocurrencies through ATMs, tablets, personal computers (“PCs”) and/or mobile devices.

Israel ceased its business operation prior to consummation of the Recapitalization Transaction.

On January 27, 2020, Virtual Crypto

Israel was sold to a third party for NIS 50,000 ($14,459).

Subscription Agreement and Loan Agreement

December 18, 2020, the company entered into a Stock Subscription Agreement (the “Subscription”) with certain investors

(the “Investors”) in connection with the sale and issuance of an aggregate of 3,000,000 shares of Common Stock, at

a purchase price of $0.01 per share, and for an aggregate purchase price of $30,000.

In addition, and on the same date, the company

entered into a Loan Agreement (the “Loan”) with the Investors, pursuant to which the Investors lent an aggregate of

$69,000 (the “Principal Amount”).

In accordance with the terms of the Loan, the company repaid the interest on the

Principal Amount (8% compounded annually) to the Investors in the form of an issuance of an aggregate of 552,000 shares of Common

Stock, at a price per share of $0.01.

The shares of Common Stock were issued to the Investors pursuant to Regulation S of the

Securities Act of 1933, as amended.

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

Company has incurred $80 in net loss for the three months ended March 31 2021 has $2,158 stockholders’

deficit as of March

31, 2021 and $2,078 in total stockholders’

deficit as of December 31, 2020 .Management expects the Company to continue to

generate substantial operating losses and to continue to fund its operations primarily through utilization of its current financial

resources and through additional raises of capital.

conditions raise substantial doubts about the Company’s ability to continue as a going concern.

1 unchanged sentence

includes raising funds from outside potential investors.

However, there is no assurance such funding will be available to

the Company or that it will be obtained on terms favorable to the Company or will provide the Company with sufficient funds

to meet its objectives.

These financial statements do not include any adjustments relating to the recoverability and classification

of assets, carrying amounts or the amount and classification of liabilities that may be required should the Company be unable

to continue as a going concern.

(Formerly known as Virtual Crypto Technologies, Inc.)

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

2 - SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation and Principles of Consolidation

The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary and were prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”).

All intercompany accounts and transactions have been eliminated in consolidation.

Unaudited Interim Financial Information

The Company’s unaudited condensed consolidated financial statements have been prepared in accordance with GAAP and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”).

Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted from this report, as is permitted by such rules and regulations.

Accordingly, these condensed consolidated financial statements should be read in conjunction with the audited financial statements as of and for the year ended December 31, 2019 and the notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 filed with the SEC on March 20, 2020 (the “2019 Annual Report”).

The results for any interim period are not necessarily indicative of results for any future period.

The unaudited condensed consolidated financial statements have been prepared on the same basis as the audited financial statements.

In the opinion of the Company’s management, the accompanying unaudited condensed consolidated financial statements contain all adjustments that are necessary to present fairly the Company’s financial position and results of operations for the interim periods presented .The results for the three and nine months ended September 30, 2020 are not necessarily indicative of the results for the year ending December 31, 2020, or for any future period.

As of September 30, 2020, there have been no material changes in the Company’s significant accounting policies from those that were disclosed in the 2019 Annual Report.

Recently Adopted Accounting Pronouncement

In June 2016, the FASB issued ASU 2016-13 “Financial

Instruments –

Credit Losses”

to improve information on credit losses for financial assets and net investment in leases

that are not accounted for at fair value through net income.

The ASU replaces the current incurred loss impairment methodology

with a methodology that reflects expected credit losses.

The Company adopted this ASU on January 1, 2020.

There was not material

impact on the interim consolidated financial statements.

In August 2018, the FASB issued ASU 2018-13, “Changes to Disclosure

Requirements for Fair Value Measurements,”

which will improve the effectiveness of disclosure requirements for recurring

and nonrecurring fair value measurements.

The standard removes, modifies, and adds certain disclosure requirements and is effective

for the Company beginning on January 1, 2020.

This standard did not have a material effect on the Company’s interim consolidated

financial statements.

(Formerly known as Virtual Crypto Technologies, Inc.)

However, there is no assurance such funding will be available to the

Company or that it will be obtained on terms favorable to the Company or will provide the Company with sufficient funds to meet

its objectives.

These financial statements do not include any adjustments relating to the recoverability and classification of

assets, carrying amounts or the amount and classification of liabilities that may be required should the Company be unable to

continue as a going concern.

ACCOUNTING POLICIES

of Presentation and Principles of Consolidation:

accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary

and were prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”)

intercompany accounts and transactions have been eliminated in consolidation.

Interim Financial Information

Company’s unaudited condensed consolidated financial statements have been prepared in accordance with GAAP and pursuant

to the rules and regulations of the Securities and Exchange Commission (the “SEC”).

Certain information and footnote

disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted from this

report, as is permitted by such rules and regulations.

Accordingly, these condensed consolidated financial statements should be

read in conjunction with the audited financial statements as of and for the year ended December 31, 2020 and the notes thereto

included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020 filed with the SEC on March 16,

2021 (the “2020 Annual Report”).

The results for any interim period are not necessarily indicative of results for

any future period.

unaudited condensed consolidated financial statements have been prepared on the same basis as the audited financial statements.

In the opinion of the Company’s management, the accompanying unaudited condensed consolidated financial statements contain

all adjustments that are necessary to present fairly the Company’s financial position and results of operations for the

interim periods presented .The results for the three months ended March 31, 2021 are not necessarily indicative of the results

for the year ending December 31, 2021, or for any future period.

of March 31, 2021, there have been no material changes in the Company’s significant accounting policies from those that

were disclosed in the 2020 Annual Report.

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

3 - OTHER ACCOUNTS RECEIVABLES

ACCOUNTS RECEIVABLES

Government authorities

4 - PROPERTY AND EQUIPMENT

Computers and related equipment

Office furniture and equipment

Accumulated depreciation

Net book value

5 - OTHER ACCOUNTS PAYABLES

Other payables and deferred revenues

ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

Other payables

Accrued liabilities

(Formerly known as Virtual Crypto Technologies, Inc.)

TO PARENT COMPANY

As of March 31

As of December 31

Parent Company Payable

part of the agreement with Gix, the parties agreed to have the Company’s operations outsourced to Gix from the agreement

date and until the acquisition is consummated.

The following term were included in the agreement pursuant to the above:

May 2018 all of the Company’s employees will become employees of Gix.

the periods of May 2018 to October 2018, Gix will pay the full expenses of the employees as well as other related expenses.

November 2018 until to the Closing Date, the employees transferred from the Company to Gix will dedicate half of their time

to the Company’s operations and correspondingly 50% of the costs to be incurred by Gix in respect of these employees

are to be charged to the Company.

From the closing date, the actual expenses incurred by Gix related

to the Company will be charged to the Company.

amounts were paid by the Company to Gix during 2021 and 2020.

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

6 - STOCKHOLDERS DEFICT

As of September 30

December 18, 2020, the company entered into a Loan Agreement (the “Loan”) and Stock Subscription Agreement with certain

Investors as described in note 1e, pursuant to which the Investors lent an aggregate amount of $69,000 (the “Principal Amount”).

In accordance with the terms of the Loan, the company prepaid the interest on the Principal Amount of 8% compounded annually to

the Investors as an issuance of 552,000 shares of Common Stock, at a price per share of $0.01.

Under the Stock Subscription Agreement,

the Investors transferred an amount of $ 30,587 to the company as consideration for the issued shares.

Company allocated the total proceeds in respect of the shares issued and the Loan extended based on its relative fair values.

As a result of the allocation, a discount of $19 was recorded on the loan.

The discount is amortized over the term of the loan

as finance expense.

allocation of the proceeds to the fair value distribution of the liability and equity components on the transactions date was

% of total fair

Allocated amount

Short term loan and prepaid interest

Investment in the company’s shares

composition of short term loan balance as of the transaction is as follows:

on Short term loan

term loan, Net

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

STOCKHOLDERS’

Stockholders’

As of March 31

As of December 31

8 unchanged sentences

have standard anti-dilutive rights, registration rights, and information and representation rights.

shares (relating to Viewbix Ltd prior to the Recapitalization Transaction):

shares may have been converted into ordinary shares of Viewbix Ltd at any time.

The preferred shares would have automatically

converted into ordinary shares if (a) the holders of at least (i) 67% (sixty seven percent) of the issued and outstanding Preferred

C/C-1 shares, (ii) a majority of the issued and outstanding Preferred B shares, and (iii) a majority of the issued and outstanding

Preferred A shares, so agree in writing;

or (b) in the event of an IPO.

conversion price for any class or series of preferred would have been subject to adjustment, as follows:

at any time, upon each

issuance or deemed issuance by the Company of any new securities at a price per share less than the applicable conversion price

in effect on the date of and immediately prior to the issuance of such new securities, the conversion price shall be reduced.

Preferred shares had priority in the distribution of dividends and upon liquidation in accordance with the Company’s Articles

of Association (“AOA”).

These rights may be changed if a meeting of the Company’s stockholders gather up and

decides on a change of regulations in this context.

preference mechanism for liquidation and the distribution of dividends gave priority to the most recent preferred stockholders.

preferred shares were convertible into 16,199,520 ordinary shares of the Company.

(Formerly known as Virtual Crypto Technologies, Inc.)

December 18, 2020, the company entered into a Stock Subscription Agreement (the “Subscription”) with certain investors

(the “Investors”) in connection with the sale and issuance of an aggregate of 3,000,000 shares of Common Stock, at

a purchase price of $0.01 per share, and for an aggregate purchase price of $30,000.

In addition, and on the same date, the company

entered into a Loan Agreement (the “Loan”) with the Investors, pursuant to which the Investors lent an aggregate of

$69,000 (the “Principal Amount”).

In accordance with the terms of the Loan, the company repaid the interest on the

Principal Amount 8% compounded annually to the Investors in the form of an issuance of an aggregate of 552,000 shares of Common

Stock, at a price per share of $0.01.

The shares of Common Stock were issued to the Investors pursuant to Regulation S of the

Securities Act of 1933, as amended.

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

6 - STOCKHOLDERS DEFICT (Cont.)

STOCKHOLDERS’

DEFICT (Cont.)

Company’s AOA do not provide redemption rights to the holders of the preferred shares.

In the event of a liquidation event,

all the funds and assets of the Company available for distribution among all the stockholders shall be distributed based on a

certain mechanism as described in the Company’s AOA.

Although the preferred shares are not redeemable, in the event of certain

“deemed liquidation events”

that are not solely within the Company’s control (including merger, acquisition,

or sale of all or substantially all of the Company’s assets), the holders of the preferred shares would be entitled to preference

amounts paid before distribution to other stockholders (as explained in the previous paragraph) and hence effectively redeeming

the preference amount.

In accordance with ASR 268 and ASC 480 “Distinguishing Liabilities from Equity”, the Company’s

preferred shares are classified outside of stockholders’

deficit as a result of these in-substance contingent redemption

of December 31, 2019 the preferred shares were no longer outstanding.

detailed in Note 1, as part of the Recapitalization Transaction in July 2019, the Company issued 20,281,085 shares of common stock

to Gix in exchange for its 99.83% holdings in Viewbix Israel.

The number of shares prior to the reverse capitalization have been

retroactively adjusted based on the equivalent number of shares received by the accounting acquirer in the Recapitalization Transaction.

As Part of the transaction all preferred shares were converted into ordinary shares.

following table summarizes information of outstanding warrants as of September 30, 2020:

In the event of a liquidation

event, all the funds and assets of the Company available for distribution among all the stockholders shall be distributed

based on a certain mechanism as described in the Company’s AOA.

Although the preferred shares are not redeemable, in

the event of certain “deemed liquidation events”

that are not solely within the Company’s control

(including merger, acquisition, or sale of all or substantially all of the Company’s assets), the holders of the

preferred shares would be entitled to preference amounts paid before distribution to other stockholders (as explained in the

previous paragraph) and hence effectively redeeming the preference amount.

In accordance with ASR 268 and ASC 480

“Distinguishing Liabilities from Equity”, the Company’s preferred shares are classified outside of

stockholders’

deficit as a result of these in-substance contingent redemption rights.

detailed in Note 1, as part of the Recapitalization Transaction in July 2019, the Company issued 30,928,620 common shares in exchange

for 99.83% of the issued and outstanding ordinary shares and all the preferred shares of Viewbix Israel.

The number of shares

prior to the reverse capitalization have been retroactively adjusted based on the equivalent number of shares received by the

accounting acquirer in the Recapitalization Transaction.

following table summarizes information of outstanding warrants as of March 31, 2021:

Exercise Price

1 unchanged sentence

Class K Warrants

Additionally,

in connection with the Share Exchange Agreement, upon the earlier of:

7 unchanged sentences

During April 2020, 142,857 Class G warrants

(Formerly known as Virtual Crypto Technologies, Inc.)

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

7 - COMMITMENTS AND CONTINGENCIES

August 2019, a lawsuit was filed against the Company and its parent Company, Gix.

The plaintiffs claim that they were entitled

to receive shares of the Company as a part of the consideration in Gix’s acquisition of the Company.

In management’s

opinion, the plaintiffs’

claims are based on incorrect assumptions that relate to the distribution of shares between the

plaintiffs and other former shareholders of the Company prior to Gix’s acquisition which would have resulted in the receipt

of shares in the acquisition transaction.

During September 2020, a settlement was reached between the parties which was later

approved by the court.

The settlement outlines that in exchange for the voluntary waiver of claims made by the plaintiffs, Gix

will issue 63,350 shares of its common stock held in trust in favor of securing the transaction by which Gix acquired shares of

in November 2018.

The remaining shares in the trust account will be used to indemnify Gix for any expenses related

to the litigation.

Since the consideration paid was in Gix’s shares, and as the claims relate to the distribution of shares

between the plaintiffs and other former shareholders of the Company, the settlement did not impact on the Company’s financial

June 2017, a lawsuit was filed by a former CEO of the Company with the Tel Aviv District Court (the “Tel Aviv Court”)

against the Company claiming certain damages in the total amount of $100, under the assertion of wrongful termination by the Company

and Emerald Israel.

The Company believes these claims to be unsubstantiated and wholly without merit and accordingly filed its

response with the Tel Aviv Court in October of 2017.

AND CONTINGENCIES

In June 2017, a lawsuit was filed by a former

CEO of the Company with the Tel Aviv District Court (the “Tel Aviv Court”) against the Company claiming certain

damages in the total amount of $225, under the assertion of wrongful termination by the Company and Emerald Israel.

Company believes these claims to be unsubstantiated and wholly without merit and accordingly filed its response with the Tel

Aviv Court in October of 2017.

The dispute was initially heard by the Tel Aviv Court on February 13, 2020.

and a supplemental hearing has been set.

As of September 30, 2020, the

company’s management, in consultation with its legal advisors, believes that the CEO's claims will not be successful

therefore the financial statements do not include a provision for the above mentioned.

(Formerly known as Virtual Crypto Technologies, Inc.)

In a supplemental

hearing on February 11, 2021 the former CEO provided data regarding his claims.

On March 11, 2021 the former CEO filed his

The Company’s summaries will be filed until May 20, 2021.

As of March 31, 2021, the company’s

management, in consultation with its legal advisors, believes that the former CEO’s claims will not be Successful.

(EXPENSES) INCOME, NET

For the three months ended March 31

Exchange rate differences

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

8 - FINANCIAL EXPENSES (INCOME), NET

For the three months ended

Exchange rate differences

For the nine months ended

Exchange rate differences

9 - TAXES ON INCOME

rates applicable to the income of the Company:

Israel is taxed according to Israeli tax laws.

Israel are taxed according to Israeli tax laws.

The Israeli corporate tax rate is 23% in the years 2019 and onwards.

4 unchanged sentences

corporate tax rate from 35% to 21%, effective January 1, 2018.

(Formerly known as Virtual Crypto Technologies, Inc.)

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

9 - TAXES ON INCOME (Cont.)

income taxes:

8 unchanged sentences

Net deferred tax asset

of September 30, 2020, the Company has provided valuation allowances of $6,961 in respect of deferred tax assets resulting from

tax loss carryforward and other temporary differences.

Management currently believes that because the Company has a history of

losses, it is more likely than not that the deferred tax regarding the loss carryforward and other temporary differences will

not be realized in the foreseeable future.

of March 31, 2020, the Company has provided valuation allowances of $6,981 in respect of deferred tax assets resulting from tax

loss carryforward and other temporary differences.

Management currently believes that because the Company has a history of losses,

it is more likely than not that the deferred tax regarding the loss carryforward and other temporary differences will not be realized

in the foreseeable future.

carryforward tax losses:

of September 30, 2020, Viewbix Israel incurred operating losses in Israel of approximately $13,368 which may be carried

forward and offset against taxable income in the future for an indefinite period.

of September 30, 2020 the Company generated net operating losses in the U.S.

of approximately $18,396 Net operating losses in

of March 31, 2021 Viewbix Israel incurred operating losses in Israel of approximately $13,466 which may be carried forward and

offset against taxable income in the future for an indefinite period.

of March 31, 2021 the Company generated net operating losses in the U.S.

of approximately $18,479 Net operating losses in the

are available through 2035.

Utilization of U.S.

net operating losses may be subject to substantial annual limitation

due to the “change in ownership”

net operating losses may be subject to substantial annual limitation due

to the “change in ownership”

provisions of the Internal Revenue Code of 1986 and similar state provisions.

annual limitation may result in the expiration of net operating losses before utilization.

(Formerly known as Virtual Crypto Technologies, Inc.)

limitation may result in the expiration of net operating losses before utilization.

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

9 - TAXES ON INCOME (Cont.)

ON INCOME (Cont.)

(income) from continuing operations, before taxes on income, consists of the following:

For the nine months ended

For the three months ended September 30

LOSS PER SHARE-BASIC AND DILUTED

the nine months

the three months

For the three months ended March 31

PER SHARE-BASIC AND DILUTED

the three months ended March 31

loss attributable to ordinary stockholders

2 unchanged sentences

per share-basic and diluted

(Formerly known as Virtual Crypto Technologies, Inc.)

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

11 - TRANSACTION AND BALANCES WITH PARENT COMPANY

Payable to parent company

part of the agreement with Gix, the parties agreed to have the Company’s operations outsourced to Gix from the agreement

date and until the acquisition is consummated.

The following term were included in the agreement pursuant to the above:

May 2018 all of the Company’s employees will become employees of Gix.

the periods of May 2018 to October 2018, Gix will pay the full expenses of the employees as well as other related expenses.

November 2018 until to the Closing Date, the employees transferred from the Company to Gix will dedicate half of their time

to the Company’s operations and correspondingly 50% of the costs to be incurred by Gix in respect of these employees

are to be charged to the Company.

amounts were paid by the Company to Gix during 2020 and 2019 in respect of the above, which resulted in a parent company payable

of $1,611 as of December 31, 2019 and $1,902 as of September 30, 2020.

12 - COVID-19 PANDEMIC IMPLICATIONS

The COVID-19 pandemic, which originated in China in late 2019, has

since spread across the globe and affected the economic condition of most, if not all, countries, including the United States,

Israel and many countries in Europe.

On March 11, 2020, the World Health Organization declared the outbreak a pandemic.

While COVID-19

is still spreading and the final implications of the pandemic are difficult to estimate at this stage, it is clear that it has

affected the lives of a large portion of the global population.

As of September 30, 2020, the pandemic has caused repeated states

of emergency to be declared in various countries, ongoing and extended travel restrictions have been imposed for several months,

strict quarantines rules have been established and maintained for an extended period of time in a plethora of jurisdictions and

various institutions and companies have been closed and rendered bankrupt.

The Company is actively monitoring the pandemic and

is taking any necessary measures to respond to the situation in cooperation with the various stakeholders.

Due to the uncertainty

surrounding the COVID-19 pandemic, the Company will continue to assess the situation, including government-imposed restrictions,

market by market.

It is not possible at this time to estimate the full impact that the COVID-19 pandemic could have on the Company’s

business, the continued spread of COVID-19, and any additional measures taken by governments, health officials or by the Company

in response to such spread, could have on the Company’s business, results of operations and financial condition.

pandemic and mitigation measures have also negatively impacted global economic conditions, which, in turn, could adversely affect

the Company’s business, results of operations and financial condition.

The extent to which the COVID-19 outbreak continues

to impact the Company’s financial condition will depend on future developments that are highly uncertain and cannot be predicted,

including new government actions or restrictions, new information that may emerge concerning the severity, longevity and impact

of the COVID-19 pandemic on economic activity.

PANDEMIC IMPLICATIONS

COVID-19 pandemic, which originated in China in late 2019, has since spread across the globe and affected the economic condition

of most, if not all, countries, including the United States, Israel and many countries in Europe.

On March 11, 2020, the World

Health Organization declared the outbreak a pandemic.

While COVID-19 is still spreading and the final implications of the pandemic

are difficult to estimate at this stage, it is clear that it has affected the lives of a large portion of the global population.

As of March 31, 2021, the pandemic has caused repeated states of emergency to be declared in various countries, ongoing and extended

travel restrictions have been imposed for several months, strict quarantines rules have been established and maintained for an

extended period of time in a plethora of jurisdictions and various institutions and companies have been closed and rendered bankrupt.

The Company is actively monitoring the pandemic and is taking any necessary measures to respond to the situation in cooperation

with the various stakeholders.

Due to the uncertainty surrounding the COVID-19 pandemic, the Company will continue to assess the

situation, including government-imposed restrictions, market by market.

It is not possible at this time to estimate the full impact

that the COVID-19 pandemic could have on the Company’s business, the continued spread of COVID-19, and any additional measures

taken by governments, health officials or by the Company in response to such spread, could have on the Company’s business,

results of operations and financial condition.

The COVID-19 pandemic and mitigation measures have also negatively impacted global

economic conditions, which, in turn, could adversely affect the Company’s business, results of operations and financial

The extent to which the COVID-19 outbreak continues to impact the Company’s financial condition will depend on

future developments that are highly uncertain and cannot be predicted, including new government actions or restrictions, new information

that may emerge concerning the severity, longevity and impact of the COVID-19 pandemic on economic activity.

MANAGEMENT’S DISCUSSION AND ANALYSIS AND RESULTS OF OPERATIONS

1 unchanged sentence

following management’s discussion and analysis section should be read in conjunction with the Company’s unaudited

financial statements as of September 30, 2020 and 2019, and the related statements of comprehensive loss, statement of changes

in stockholders’

financial statements as of March 31, 2021 and 2020, and the related statements of comprehensive loss, statement of changes in

stockholders’

equity (deficit) and statements of cash flows for the three months then ended, and the related notes thereto

84 unchanged sentences

changed its name to Gix Internet Ltd., or Gix

On January 1, 2020, the

Company announced certain cost reduction measures due to the Company not achieving certain revenue goals.

In connection

with these cost reduction measures, on January 1, 2020, Mr.

Jonathan Stefansky, the Company’s then chief executive officer

and member of the Company’s board of directors, tendered his resignation from the Board, and on the same date, the

January 1, 2020, the Company announced certain cost reduction measures due to the Company not achieving certain revenue goals.

In connection with these cost reduction measures, on January 1, 2020, Mr.

Jonathan Stefansky, the Company’s then chief executive

officer and member of the Company’s board of directors, tendered his resignation from the Board, and on the same date, the

sides reached a mutual understanding whereby Mr.

7 unchanged sentences

January 27, 2020, the Company entered into an agreement with a third-party to sell Virtual Crypto Technologies Ltd.

for NIS 50,000

($14, 459), which transaction was consummated on February 12, 2020.

NIS 50,000 ($14, 459), which transaction was consummated on February 12, 2020.

of Operations

of Operations During the Three Months Ended September 30, 2020 as Compared to the Three Months Ended September 30, 2019

Our revenues were $17 thousand

for the three months ended September 30, 2020, compared to $63 thousand during the same period in the prior year.

The reason for

the decrease in the three months ended September 30, 2020 is due to the fact that on January 1, 2020, the Company announced and

began implementing certain cost reduction measures.

Our cost of revenues were

$1 thousand for the three months ended September 30, 2020, which is the same amount recognized in the same period during

the previous year.

research and development expenses were $0 thousand for the three months ended September 30, 2020, as compared to $82 thousand

of Operations During the Three Months Ended March 31, 2021 as Compared to the Three Months Ended March 31, 2020

revenues were $8 thousand for the three months ended March 31, 2021, compared to $37 thousand during the same period in the prior

The reason for the decrease in the three months ended March 31, 2021 is due to the fact that on January 1, 2020, the Company

announced and began implementing certain cost reduction measures.

cost of revenues were $0 thousand for the three months ended March 31, 2021, with a slight decrease as compare to $4 thousand

during the same period in the prior year.

The reason for the decrease in the three months ended September 30, 2020 is due to the

fact that beginning on January 1, 2020, the Company announced and began implementing certain cost reduction measures.

selling and marketing expenses were $1 thousand for the three months ended September 30, 2020, as compared to $57 thousand during

research and development expenses were $16 thousand for the three months ended March 31, 2021, as compared to $59 thousand during

the same period in the prior year.

The reason for the decrease in the three months ended September 30, 2020 is due to the fact

that on January 1, 2020, the Company announced and begin implementing certain cost reduction measures.

Our general and administrative

expenses decreased to $70 thousand for the three months ended September 30, 2020 as compared to $190 thousand during the same

period in the prior year.

Beginning on January 1, 2020, we announced and began implementing certain cost reduction measures.

addition, during the same period last year, the Company incurred various fees and expenses related to its status as a public

company, including certain compliance and consultancy related fees and expenses.

Our financial income was

$11 thousand for the three months ended September 30, 2020, compared to financial expenses of $21 thousand during the same period

in the prior year.

The reason for the financial increase during the three months ended September 30, 2020 is due to the

US dollar exchange rate difference during the three months ended September 30, 2020 as compared to the same period in the

tax on income was $0 thousand for the three months ended September 30, 2020, which is a slight increase compared to $(4) thousand

during the same period in the prior year.

of Operations During the Nine Months Ended September 30, 2020 as Compared to the Nine Months Ended September 30, 2019

Our revenues were $86 thousand

for the nine months ended September 30, 2020, compared to $139 thousand during the same period in the prior year.

The reason for

the decrease in the three months ended September 30, 2020 is due to the fact that on January 1, 2020, the Company announced and

began implementing certain cost reduction measures.

cost of revenues were $5 thousand for the nine months ended September 30, 2020, which is a slight increase compared to $4 thousand

The reason for the decrease in the three months ended March 31, 2021 is due to the fact that

beginning on January 1, 2020, the Company announced and began implementing certain cost reduction measures.

selling and marketing expenses were $2 thousand for the three months ended March 31, 2021, as compared to $7 thousand during the

same period in the prior year.

The reason for the decrease in the three months ended March 31, 2021 is due to the fact that on

January 1, 2020, the Company announced and begin implementing certain cost reduction measures.

general and administrative expenses decreased to $63 thousand for the three months ended March 31, 2021 as compared to $175 thousand

during the same period in the prior year.

research and development expenses were $59 thousand for the nine months ended September 30, 2020, as compared to $170 thousand

Beginning on January 1, 2020, we announced and began implementing certain cost reduction

net financial expenses was $7 thousand for the three months ended March 31, 2021, compared to net financial income of $28 thousand

during the same period in the prior year.

The reason for the decrease in the nine months ended September 30, 2020 is due to the

fact that beginning on January 1, 2020, the Company announced and began implementing certain cost reduction measures.

Our selling and marketing

expenses were $8 thousand for the nine months ended September 30, 2020, as compared to $199 thousand during the same period in

the prior year.

The reason for the decrease in the nine months ended September 30, 2020 is due to the fact that beginning on January

1, 2020, the Company announced and began implementing certain cost reduction measures.

Our general and administrative

expenses decreased to $339 thousand for the nine months ended September 30, 2020 as compared to $422 thousand during the same

period in the prior year.

Beginning on January 1, 2020, we announced and began implementing certain cost reduction measures.

addition, during the same period last year, the Company incurred various fees and expenses related to its status as a public

company, including certain compliance and consultancy related fees and expenses.

financial income was $8 thousand for the nine months ended September 30, 2020, compared to financial expenses of $60 thousand

The reason for the change is due to the US dollar exchange rate difference during the

three months ended March 31, 2021 as compared to the same period in the prior year.

In addition during December 2020 the company

entered into a Loan Agreement with certain investors which bearing an annually interest of 8%.

tax on income was $0 thousand for the three months ended March 31, 2021, which is a slight decrease compared to $2 thousand

during the same period in the prior year.

The reason for the financial decrease in the nine months ended September 30, 2020 is

due to the US dollar exchange rate difference during the nine months ended September 30, 2020 as compared to the same period

in the prior year.

tax on income was $2 thousand for the nine months ended September 30, 2020, as compared to $19 thousand during the same period

in the prior year.

The reason for the decrease in the nine months ended September 30, 2020 is due to the fact that during the

same period in the prior year the Company recognized a one-time tax expense related to prior years.

and Capital Resources

Our balance sheet as of

September 30, 2020 reflects current assets of $89 thousand, consisting of $65 thousand cash and cash equivalents, other receivables

and trade receivables of $24 thousand.

We also have $2,093 thousand in current liabilities, consisting of $191 thousand

in trade payables and other accounts payable owed to Gix in the amount of $1,902 thousand.

of March 31, 2021, we had current assets of $196 thousand consisting of $134 thousand in cash and cash equivalents, $21 thousand

in trade receivables, $14 thousand in other accounts receivables and, $27 thousand in prepaid expenses.

had $2,354 thousand in current liabilities consisting of $186 in other accounts payable and accrued liabilities, $54 Short term

loan $10 trade payable, and $2,104 payable to our parent company.

As of December

31, 2019, we had current assets of $225 thousand mainly consisting of $87 thousand in cash, other receivables and prepaid expenses

of $136 thousand and restricted cash of $2.

As of December 31, 2019, we had $1,923 thousand in current liabilities consisting

of $312 thousand in trade payables and other accounts payables and $1,611 thousand payable to Gix.

had negative working capital of $2,004 thousand as of September 30, 2020, as compared to negative working capital of $1,698 thousand

on December 31, 2019.

Our total liabilities as of September 30, 2020 were $2,093 thousand, as compared to $1,923 thousand on December

the three months ended September 30, 2020, we had negative cash flow from operations of $14 thousand, which was the result of

a net loss of $44 thousand, an increase in payables to Gix in the amount of $51 thousand, decrease in trade payables and other

payables of $13 thousand and decrease in prepaid expenses and other receivables of $8 thousand.

the nine months ended September 30, 2020, we had negative cash flow from operations of $37 thousand, which was the result of a

net loss of $311 thousand, increase in payables to Gix in the amount of $292 thousand and decrease in trade payables and other

payables of $127 thousand and increase in prepaid expenses and other receivables of $112 thousand.

31, 2020, we had current assets of $225 thousand consisting of $148 thousand in cash and cash equivalents, $20

thousand in other receivables, $15 thousand in trade receivables and $42 thousand in prepaid expenses.

$2,303 thousand in current liabilities, which consisted of $177 in accounts payable and accrued liabilities, $22

trade payable, $2,054 payable to our parent company and $50 in Short term loan.

We had a negative working

capital of $2,158 thousand and $2,078 thousand as of March 31, 2021 and December 31, 2020, respectively.

Current liabilities as of March 31, 2021 were $2,354 thousand compared to $2,303 thousand as of December 31, 2020.

the three months ended March 31, 2021, we had negative cash flow from operations of $14 thousand which was mainly the result of

a net loss of $80 thousand, offset by decrease in working capital of $66 thousand.

the three months ended March 31, 2020, we had positive cash flow from operations of $10 thousand which was mainly the result of

a net loss of $174 thousand, offset by gains from the sale of a subsidiary and decrease in working capital of $187.

the three months ended March 31, 2021, we had none cash flow effect from investing activities as compared to a positive cash flow

effect from investing activities of $13 thousand as during the three mounts ended March 31, 2020.

are no limitations in the Company’s Certificate of Incorporation on the Company’s ability to borrow funds or raise

24 unchanged sentences

be required to delay, limit, reduce or terminate the operations of some or all of its business segments.

Company has incurred $311 in net losses for the nine months ended September 30, 2020, has $2,004 stockholders’

of September 30, 2020 and $1,693 in total stockholders’

Company has incurred $80 in net losses for the three months ended March 31, 2021, has $2,158 stockholders’

deficit as of

March 31, 2021 and $2,078 in total stockholders’

deficit as of December 31, 2020.

Management expects the Company

to continue to generate substantial operating losses and to continue to fund its operations primarily through utilization of its

current financial resources and through additional raises of capital.

Management expects the Company to continue

to generate substantial operating losses and to continue to fund its operations primarily through utilization of its current financial

resources and through additional raises of capital.

conditions raise substantial doubts about the Company’s ability to continue as a going concern.

10 unchanged sentences

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 1. Financial Statements