What changed in this filing

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Item 1. Financial Statements

2023-05-15 compared with 2022-11-21 · 341 added, 958 removed, 161 unchanged (89% of the section changed)

FINANCIAL STATEMENTS

CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Interim Condensed Consolidated Balance Sheets (unaudited)

2 unchanged sentences

Interim Condensed Consolidated Statements of Cash Flows (unaudited)

Notes to the Interim Condensed Consolidated Financial Statements

CONSOLIDATED BALANCE SHEETS (Unaudited)

Notes to the Interim Condensed Consolidated Financial Statements (unaudited)

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)

dollars in thousands (except share data)

4 unchanged sentences

Loan to parent company

Other receivables

Other current assets

Total current assets

3 unchanged sentences

Property and equipment, net

Operating lease right-of-use assets

Operating lease right-of-use asset

Intangible assets, net

Total non-current assets

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

CONSOLIDATED BALANCE SHEETS (Unaudited) (Cont.)

accompanying notes are an integral part of these Interim Condensed Consolidated financial statements.

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Cont.)

dollars in thousands (except share data)

1 unchanged sentence

CURRENT LIABILITIES

Current maturities of long-term loan

Loan from parent company

Accounts payable

Other payables

Short-term loans

Current maturities of long-term loans

Other payables

Operating lease liabilities - short term

2 unchanged sentences

Accrued severance pay

Long-term loan

Long-term loans, net of current maturities

Operating lease liabilities - long term

1 unchanged sentence

Total non-current liabilities

Commitments and Contingencies

SHAREHOLDERS’ EQUITY

Share Capital

Common stock of $ 0.0001

par value - Authorized:

Common stock of $ 0.0001 par value - Authorized:

490,000,000 shares;

Issued and outstanding:

shares as of September 30, 2022 and December 31, 2021, respectively (*)

14,783,964 shares as of March 31, 2023, and December 31, 2022

Additional paid-in capital

Accumulated deficit

Equity attributed to the company’s shareholders

Equity attributed to shareholders of Viewbix Inc.

Non-controlling interests

Total liabilities and shareholders’ equity

Retroactively

adjusted to reflect the reverse stock split effected on August 31, 2022 (see note 1.d) for all periods presented and to reflect the

equivalent number of shares corresponding to the combined financial information of the Company and Gix Media Ltd.

for all periods

preceding the Reorganization Transaction (see note 1.b)

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

CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)

accompanying notes are an integral part of these Interim Condensed Consolidated financial statements.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (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,

Costs and Expenses:

4 unchanged sentences

Depreciation and amortization

Other expenses

Operating income (loss)

Financial income (expenses), net

Income before income taxes

Taxes on income

Net income (loss)

Net income (loss) for the period is attributable to:

Non-controlling interests

Net income (loss)

Net income (loss) per Share – Basic and Diluted attributed to shareholders:

Financial expense, net

Loss before income taxes

Income tax expense

net income attributable to non-controlling interests

Net loss attributable to shareholders of Viewbix Inc.

Net income per share – Basic attributed to shareholders:

Net income per share – Diluted attributed to shareholders:

Weighted average number of shares – Basic:

Weighted average number of shares (*)

Retroactively

adjusted to reflect the reverse stock split effected on August 31, 2022 (see note 1.d) for all periods presented and to reflect the

equivalent number of shares corresponding to the combined financial information of the Company and Gix Media Ltd.

for all periods

preceding the reorganization transaction (see note 1.b)

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

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (Unaudited)

(*) 14,783,964 (*)

Weighted average number of shares – Diluted:

(*) 15,044,630 (*)

and per share data in these financial statements have been retrospectively adjusted to reflect a number

of shares that is equivalent to the number of shares of the Company post the Reorganization Transaction (see note 1.B).

accompanying notes are an integral part of these Interim Condensed Consolidated financial statements.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (Unaudited)

dollars in thousands (except share data)

2 unchanged sentences

Net income (loss)

Adjustment to ultimate parent’s carrying values (see note

Share-based compensation

Dividend declared to shareholders

Dividend distributed to non-controlling interests

Balance as of September 30, 2022

Balance as of July 1, 2022

Net income (loss)

Share-based compensation

Dividend declared to shareholders

Dividend distributed to non-controlling interests

Balance as of September 30, 2022

Transaction with the non-controlling interests (see note 1.C)

Transaction with the non-controlling interests

Balance as of March 31, 2023

Common stock ( * )

to the company’s

Balance as of January 1, 2022

Balance as of September

Balance as of July 1, 2021

Net income (loss)

Share-based compensation

Balance as of September 30, 2021

Retroactively

adjusted to reflect the reverse stock split effected on August 31, 2022 (see note 1.d) for all periods presented and to reflect the

equivalent number of shares corresponding to the combined financial information of the Company and Gix Media Ltd.

for all periods

preceding the reorganization transaction (see note 1.b)

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

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

Adjustment to ultimate parent’s carrying values (see note 1.B)

Adjustment to ultimate parent’s carrying values

Dividend declared to non-controlling interests

Balance as of March 31, 2022

and per share data in these financial statements have been retrospectively adjusted to reflect a number

of shares that is equivalent to the number of shares of the Company post the Reorganization Transaction (see note 1.B).

accompanying notes are an integral part of these Interim Condensed Consolidated financial statements.

CONDENSED 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

Cash flows from Operating Activities

Net income (loss)

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

Depreciation and amortizations

Share-based compensation

Deferred taxes

Accrued interest, net

Fair value revaluation and exchange rate differences on loans

Adjustment total

Changes in assets and liabilities items:

Decrease in accounts receivable

Decrease (increase) in other receivables

Decrease in operating lease right-of-use assets

Increase (decrease) in severance pay, net

Increase (decrease) in accounts payable

the three months ended March 31,

flows from Operating Activities

income (loss)

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

and amortizations

interest, net

rate differences on loans

assets and liabilities items:

(increase) in accounts receivable

(increase) in other receivables

in operating lease right-of-use assets

Increase (decrease)

in severance pay, net

in accounts payable

Decrease in other payables

Decrease in operating lease liabilities

Increase in parent company loan

Increase (Decrease) in

Operating Capital

Net cash provided by operating activities

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

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (Cont.)

in operating lease liabilities

in loan from parent company

cash provided by (used in) operating activities

accompanying notes are an integral part of these Interim Condensed Consolidated financial statements.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (Cont.)

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 Investing Activities

Purchase of property and equipment

Cash paid to non-controlling interests (see note 1.C)

Capitalization of software development costs

1 unchanged sentence

Cash flows from Financing Activities

Receipt of short-term loan

Repayment of short-term loan

Increase in loan to parent company

Repayment of long-term loan

Repayment of short-term loans

Receipt of long-term bank loan

Repayment of long-term bank loans

Payment of dividend to non-controlling interests

Net cash used in financing activities

Increase in cash and cash equivalents and restricted cash

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

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

Payment of dividend to shareholders

Increase in loan to parent company

Net cash provided by (used in) financing activities

Decrease in cash and cash equivalents and restricted cash

Cash and cash equivalents and restricted cash at beginning of period

Cash and cash equivalents and restricted cash at end of period

Supplemental Disclosure of Cash Flow Activities:

Cash paid and received during the period

Cash paid during the period

Interest paid

Total Cash paid and received during the

Substantial non-cash activities:

Right of use assets obtained in exchange for operating lease liabilities

Dividend declared

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

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

accompanying notes are an integral part of these Interim Condensed Consolidated financial statements.

TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited

dollars in thousands (except share data)

5 unchanged sentences

Company, changed its name to Zaxis International, Inc (“Zaxis”).

In 2015, the Company changed its name to Emerald Medical Applications Corp.

In 2015 the Company changed its name to Emerald Medical

Applications Corp., subsequent to which the Company, through its subsidiarity, was engaged in the development of technology for use in

detection of skin cancer.

On January 29, 2018, the Company ceased its business operations in this field.

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

3 unchanged sentences

to Virtual Crypto Technologies, Inc.

to reflect its new operations and business focus.

VCT Israel ceased its business operation in 2019 and prior to consummation of the Recapitalization

On January 27, 2020, VCT Israel was sold to a third party for NIS 50 thousand (approximately $ 13 ).

February 7, 2019, the Company entered into a share exchange agreement (the “Share Exchange Agreement” or the “Recapitalization

Transaction”) with Gix Internet Ltd., a company organized under the laws of the State of Israel (“Gix” or “Parent

Company’’), pursuant to which, Gix assigned, transferred and delivered its 99.83 %

holdings in Viewbix Ltd., a company organized under the laws of the State of Israel (“Viewbix Israel”), to the Company in

exchange for shares of the Company, which resulted in Viewbix Israel becoming a subsidiary of the Company.

In connection with the Share

Exchange Agreement, effective as of August 7, 2019, the Company’s name was changed from Virtual Crypto Technologies, Inc.

these financial statements:

Company – Viewbix Inc.

Group – Viewbix Inc.

and its subsidiaries

Parent Company or Gix – Gix Internet Ltd.

Media – Gix Media Ltd.

– Cortex Media Group Ltd.

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

GENERAL (Cont.)

Company’’), pursuant to which, Gix assigned, transferred and delivered its 99.83 % holdings in Viewbix Ltd., a company organized

under the laws of the State of Israel (“Viewbix Israel”), to the Company in exchange for shares of the Company, which resulted

in Viewbix Israel becoming a subsidiary of the Company.

In connection with the Share Exchange Agreement, effective as of August 7, 2019,

the Company’s name was changed from Virtual Crypto Technologies, Inc.

to Viewbix Inc.

Reorganization Transaction

December 5, 2021, the Company entered into a certain Agreement and Plan of Merger with Gix Media, an Israeli company and the majority-owned

subsidiary of Gix, the Parent Company and Vmedia Merger Sub Ltd., an Israeli company and wholly-owned subsidiary of the Company (“Merger

Sub”), pursuant to which, Merger

Sub merged with and into Gix Media, with Gix Media being the surviving entity and a wholly-owned subsidiary of the Company (the “Reorganization

Transaction”).

December 5, 2021, the Company entered into a certain Agreement and Plan of Merger with Gix Media Ltd.

(“Gix Media”), an Israeli

company and the majority-owned ( 77.92 %) subsidiary of Gix, the Parent Company and Vmedia Merger Sub Ltd., an Israeli company and wholly-owned

subsidiary of the Company (“Merger Sub”), pursuant to which, Merger Sub merged with and into Gix Media, with Gix Media being

the surviving entity and a wholly-owned subsidiary of the Company (the “Reorganization Transaction”).

September 19, 2022, (the “Closing Date”) the Reorganization Transaction was consummated and as a result, all outstanding

ordinary shares of Gix Media, having no par value (the “Gix Media Shares”) were delivered to the Company’s in

exchange for the Company’s shares of common stock.

Prior to the closing of the Reorganization Transaction, Gix Media was a

majority-owned subsidiary of Gix.

As a result of

the Reorganization Transaction, the former holders of Gix Media Shares, who previously held

approximately 69% of the Company’s shares on a fully diluted basis, hold 90% of the Company’s Common Stock on a fully diluted basis, and

Gix Media became a wholly-owned subsidiary of the Company , which holds 100% of its share capital.

ordinary shares of Gix Media, having no par value (the “Gix Media Shares”) were delivered to the Company in exchange for

the Company’s shares of common stock, par value $ 0.0001 per share (“Common Stock”).

As a result of the Reorganization

Transaction, the former holders of Gix Media Shares, who previously held approximately 68% of the Company’s Common Stock, hold

approximately 97% of the Company’s Common Stock, and Gix Media became a wholly owned subsidiary of the Company.

the Company and Gix Media Ltd.

were consolidated by the same parent and ultimate parent, Gix Internet Ltd.

and Medigus Ltd., respectively,

before and after the Reorganization Transaction, the Reorganization Transaction was accounted for as a transaction between entities under

common control.

Accordingly, the combined financial information of the Company and Gix Media Ltd.

is presented in these financial statements,

for all periods presented, reflecting the historical cost of the Company and Gix Media Ltd., as it is reflected in the consolidated financial

statements of the direct parent, Gix Internet Ltd., for all periods preceding March 1, 2022, the date Medigus Ltd.

obtained control in

Gix Internet Ltd., and as it is reflected in the consolidated financial statements of Medigus Ltd.

for all periods subsequent to March

and per share data in these financial statements have been retrospectively adjusted, for all periods preceding the Reorganization Transaction,

to reflect the equivalent number of shares of the Company corresponding to the combined financial information of the Company and Gix

Business Operations

Group, through its subsidiaries Gix Media Ltd.

and Cortex Media Group Ltd., operates in the field of digital advertising.

has two main activities that are reported as separate business segments:

the search segment and the digital content segment.

search segment activity is operated by Gix Media.

were Interim Condensed Consolidated both by the Parent Company and Medigus Ltd.

(the “Ultimate

Parent”), before and after the Reorganization Transaction, the Reorganization Transaction was accounted for as a transaction

between entities under common control.

Accordingly, the financial information of the Company and Gix Media Ltd.

is presented in

these financial statements, for all periods presented, reflecting the historical cost of the Company and Gix Media Ltd., as it is

reflected in the consolidated financial statements of the Parent Company, for all periods preceding March 1, 2022, the date the

Ultimate Parent obtained a controlling interest in the Parent Company and as it is reflected in the consolidated

financial statements of the Ultimate Parent for all periods subsequent to March 1, 2022.

and per share data in these financial statements have been retrospectively adjusted, for the three months ended March 31, 2022, to reflect

a number of shares that is equivalent to the number of shares of the Company post the Reorganization Transaction.

TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited

dollars in thousands (except share data)

GENERAL (Cont.)

Business Overview

Company and its subsidiaries (the “Group”), Gix Media and Cortex Media Group Ltd.

(“Cortex”), operate in the

field of digital advertising.

The Group has two main activities that are reported as separate operating segments:

the search segment

and the digital content segment.

search segment develops a variety of technological software solutions, which perform automation, optimization, and monetization of internet

campaigns, for the purposes of acquiring and routing internet user traffic to its customers.

digital content segment is engaged in the creation and editing of content, in different languages, for different target audiences,

for the purposes of generating revenues from leading advertising platforms, including Google, Facebook, Yahoo and Apple, by

utilizing such content to obtain internet user traffic for its advertisers.The digital content activity is operated by Cortex.

Media holds 70 % of Cortex’s share capital.

Group’s technological tools allow advertisers and website owners to earn more from their advertising campaigns and generate additional

profits from their websites.

campaigns, for the purposes of obtaining and routing internet user traffic to its customers.

The search segment activity is conducted

by Gix Media.

digital content segment is engaged in the creation and editing of content, in different languages, for different target audiences, for

the purposes of generating revenues from leading advertising platforms, including Google, Facebook, Yahoo and Apple, by utilizing such

content to obtain and route internet user traffic for its customers.

The digital content segment activity is conducted by Cortex.

of December 31, 2022, Gix Media holds 70 %

of Cortex’s share capital.

On January 23, 2023, Gix Media acquired

an additional 10 % of the share capital Cortex, increasing its holdings to 80 % of the share capital of Cortex in consideration for $ 2,625

(the “Subsequent Purchase”).

The Subsequent Purchase was financed by Gix Media’s existing cash balances and by a long-term

bank loan received on January 17, 2023, in the amount of $ 1,500 .

The Subsequent Purchase, was recorded as a transaction with non-controlling

interests in the Company’s statement of changes in shareholders equity for the three month period ended March 31, 2023.

Reverse Stock Split

connection with the Closing of the Reorganization Transaction, the Company filed an Amended and Restated Certificate of

Incorporation (the “Amended COI”) with the Secretary of State of Delaware, effective as of August 31, 2022, pursuant to

which, concurrently with the effectiveness of the Amended COI, the Company, among other things, effected a reverse stock split of its

Common Stock at a ratio of 1-for-28.

Share and per share data in these financial statements have been retrospectively adjusted to reflect the reverse

stock split for all periods presented.

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation and Principles of Consolidation:

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

and were prepared in accordance with accounting principles generally accepted in the United States of America (“U.S.

intercompany accounts and transactions have been eliminated in consolidation.

Unaudited Interim Financial Information

Company’s unaudited condensed consolidated financial statements have been prepared in accordance with U.S.

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 U.S .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, 2021 and the notes thereto included in the Company’s

Annual Report on Form 10-K for the year ended December 31, 2021 filed with the SEC on March 17, 2022 (the “2021 Annual Report”).

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

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 nine months ended September 30, 2022, are not necessarily indicative of the results for the year ending December

31, 2022, or for any future period.

of September 30, 2022, following the retrospective presentation of the combined financial information of the Company and Gix Media

Ltd., the Company adopted the significant accounting policies described in Note 2 in these unaudited condensed consolidated

financial statements.

Other than these significant accounting policies, there have been no material changes in the Company’s

significant accounting policies from those that were disclosed in the 2021 Annual Report.

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

connection with the Closing of the Reorganization Transaction, the Company filed an Amended and Restated Certificate of Incorporation

(the “Amended COI”) with the Secretary of State of Delaware, effective as of August 31, 2022, pursuant to which, concurrently

with the effectiveness of the Amended COI, the Company, among other things, effected a reverse stock split of its Common Stock at a ratio

of 1-for-28 .

Share and per share data in these financial statements have been retrospectively adjusted to reflect the reverse stock split

for the three months ended March 31, 2023.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Unaudited Interim Financial Statements

accompanying unaudited interim condensed financial statements have been prepared in accordance with U.S.

generally accepted accounting

principles (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of U.S.

and Exchange Commission Regulation S-X.

Accordingly, they do not include all the information and footnotes required by generally accepted

accounting principles for complete financial statements.

In the opinion of management, all adjustments considered necessary for a fair

presentation have been included (consisting only of normal recurring adjustments except as otherwise discussed).

For further information,

reference is made to the consolidated financial statements and footnotes thereto included in the Group’s Annual Report on Form

10-K for the year ended December 31, 2022.

Principles of Consolidation

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

All intercompany

balances and transactions have been eliminated in consolidation.

TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited

dollars in thousands (except share data)

SIGNIFICANT ACCOUNTING POLICIES (Cont.)

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont.)

Use of estimates

preparation of financial statements in conformity with U.S.

GAAP requires management to make estimates, judgments and assumptions

that affect the amounts reported of assets and liabilities and disclosure at the date of the consolidated financial statements and

the reported amounts of income and expense during the reporting period.

The Company evaluates on an ongoing basis its assumptions,

including those related to contingencies, income taxes, deferred taxes, share-based compensation and leases.

Actual results could

differ from those estimates.

Functional Currency and Foreign Currency Transactions

of the revenues of the Company are received in U.S.

In addition, a substantial portion of the costs of the Company are incurred

Therefore, the Company’s management believes that the U.S.

dollar is the currency of the primary economic environment

in which the Company and each of its subsidiaries operates.

Thus, the functional and reporting currency of the Company is the U.S.

monetary balances denominated in currencies other than the U.S.

dollar are re-measured into U.S.

dollars in accordance with Statement

of the Accounting Standard Codification (“ASC”) No.

830 “Foreign Currency Matters” (“ASC No.

and balances originally denominated in U.S.

dollars are presented at their original amounts.

Balances in non U.S.

dollar currencies are

translated into U.S.

dollars using historical and current exchange rates for non-monetary and monetary balances, respectively.

dollar transactions and other items in the statements of operations (indicated below), the following exchange rates are used:

transactions exchange rates at transaction dates and (ii) for other items (derived from non-monetary balance sheet items such as depreciation

and amortization) historical exchange rates.

Currency transaction gains and losses are presented in the financial income or expenses,

as appropriate

Cash and cash equivalents

Company considers all short-term investments, which are highly liquid investments with original maturities of three months or less at

the date of purchase, to be cash equivalents.

Restricted Deposits

cash held in interest bearing saving accounts which are used as a security for the Group’s credit card and lease obligations.

Accounts receivable and allowance for credit losses

receivables are recorded at the invoiced amount, net of an allowance for credit losses.

The Group evaluates its outstanding accounts

receivables and establishes an allowance for credit losses based on information available on their credit condition, current aging, historical

experience, future economic and market conditions.

These allowances are reevaluated and adjusted periodically as additional information

is available.

Changes in the allowance for expected credit losses are recorded under general and administrative expenses in the condensed

consolidated statements of income.

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

SIGNIFICANT ACCOUNTING POLICIES (Cont.)

and equipment are stated at cost, net of accumulated depreciation.

Depreciation is calculated using the straight-line basis over the

estimated useful lives, at the following annual rates:

OF ESTIMATED USEFUL LIVES

Computers and peripherals equipment

Office furniture and equipment

Leasehold improvements

Over the shorter of the lease term (including options if any

that are reasonably certain to be exercised estimated useful life).

accordance with ASC No.

842 “Leases”, the Company determines if an arrangement is a lease at inception.

If an arrangement

is a lease, the Company determines whether it is an operating lease or a finance lease at the lease commencement date.

Operating leases

are included in operating lease assets, operating lease liabilities – current, and non-current operating lease liabilities in the

Company’s condensed consolidated balance sheets.

lease assets represent the Company’s right to control the use of an underlying asset for the lease term and lease liabilities represent

the Company’s obligation to make lease payments arising from the estimated lease.

lease assets and liabilities are recognized on the commencement date based on the present value of lease payments over the lease term.

Company uses its incremental borrowing rate based on the information available at the commencement date to determine the present value

of the lease payments.

The incremental borrowing rate is estimated based on factors such as the lease term, credit standing and the economic

environment of the location of the lease.

lease payments, including payments based on an index or a rate, are expensed as incurred and are not included within the operating lease

asset and operating lease liabilities.

The Company does not separate non-lease components from lease components for its leases of real

Company’s lease terms are the noncancelable periods, including any rent-free periods provided by the lessor, and include options

to extend or terminate the lease when it is reasonably certain that the Company will exercise that option.

At lease inception, and in

subsequent periods as necessary, the Company estimates the lease term based on its assessment of extension and termination options that

are reasonably certain to be exercised.

Lease costs are recognized on a straight-line basis over the lease term.

Company does not recognize operating lease asset and operating lease liabilities for leases with terms shorter than 12 months.

costs for short-term leases are recognized on a straight-line basis over the lease term.

Company has material non-functional currency leases.

Lease liabilities in respect of leases denominated in a foreign currency

are remeasured using the exchange rate at each reporting date.

Lease assets are measured at historical rates,

which are not affected by subsequent changes in the exchange rates.

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

SIGNIFICANT ACCOUNTING POLICIES (Cont.)

Revenue Recognition

described in note 1(a) the Company generates revenues from obtaining internet user traffic and routing such traffic to its customers.

The Company is entitled to receive consideration for its service upon each individual internet user traffic that was routed to and is

monetized by its customers.

Company’s revenues are measured according to the ASC 606, “Revenue from Contracts with Customers” (“ASC 606”).

Under ASC 606, revenues are measured according to the amount of consideration that the Company expects to be entitled in exchange for

transferring promised goods or services to a customer, excluding amounts collected on behalf of third parties, such as VAT taxes.

are presented net of VAT.

The Company’s payments terms are less than one year.

Therefore, no finance component is recognized.

Company recognizes revenues upon routing of internet users’ traffic that is monetized by its customers.

As the Company

operates as the primary obligor in its arrangements and has sole discretion in determining to which of its customers internet user

traffic is to be routed, revenues are presented on a gross basis.

Traffic-acquisition and related costs

Traffic acquisition and related costs consist primarily of fees paid to

suppliers in connection with the Company’s internet traffic sources, as well as internal costs incurred in connection with the acquisition

of such traffic.

Traffic acquisition costs are expensed as incurred.

Research and development expenses

and development costs are charged to the condensed consolidated statements of income as incurred, except for certain costs relating to

internally developed software, which are capitalized.

Company capitalizes certain internal software development costs, consisting of direct subcontractors’ costs associated with creating

the internally developed software.

Software development projects generally include three stages:

(i) the preliminary project stage (all

costs expensed as incurred);

(ii) the application development stage (costs are capitalized) and (iii) the post implementation/operation

stage (all costs expensed as incurred).

costs capitalized in the application development stage primarily include the costs of designing the application, coding and testing of

Capitalized costs are amortized using the straight-line method over the estimated useful life of the software, once it is

ready for its intended use.

Company believes that the straight-line recognition method best approximates the manner in which the expected benefit will be derived.

Management evaluates the useful lives of these assets on an annual basis and tests for impairment whenever events or changes in circumstances

occur that could impact the recoverability of these assets.

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

SIGNIFICANT ACCOUNTING POLICIES (Cont.)

Company accounts for income taxes in accordance with ASC 740, “Income Taxes”, and (“ASC 740”).

ASC 740 prescribes

the use of the asset and liability method whereby deferred tax asset and liability account balances are determined based on differences

between the financial reporting and tax bases of assets and liabilities and for carry forward tax losses.

Deferred taxes are measured

using the enacted tax rates and laws that will be in effect when the differences are expected to reverse.

The Company records a valuation

allowance, if necessary, to reduce deferred tax assets to their estimated realizable value if it is more-likely-than-not that some portion

or all of the deferred tax asset will not be realized.

tax positions are accounted for in accordance with the provisions of ASC 740-10, under which a company may recognize the tax benefit

from an uncertain tax position claimed or expected to be claimed on a tax return only if it is more likely than not that the tax position

will be sustained on examination by the taxation authorities, based on the technical merits of the position, at the largest benefit that

has a greater than fifty percent likelihood of being realized upon ultimate settlement.

Interest and penalties, if any, related to unrecognized

tax benefits, are recognized in tax expense.

Fair Value of Financial Instruments

carrying amounts of cash and cash equivalents, restricted deposits, accounts receivable, loan to parent company, other current assets,

current maturities of long-term loan, accounts payable, other payables and short-term loans approximate their fair value due to

the short-term maturities of such instruments.

carrying amount of the variable interest rate long-term loan is approximates to its fair value as it bears interest at

approximate market rate.

Business Combinations

Company accounts for its business combinations in accordance with ASC 805, “Business Combinations” (“ASC 805”).

ASC 805 specifies the accounting for business combinations and the criteria for recognizing and reporting intangible assets apart from

ASC 805 requires recognition of assets acquired, liabilities assumed and any non-controlling interest at the acquisition date,

measured at their fair values as of that date.

Acquisition-related

intangible assets result from the Company’s acquisitions of businesses accounted for under the purchase method and consist of the

fair value of identifiable intangible assets including customer relations, technology, as well as goodwill.

Goodwill is the amount by

which the acquisition cost exceeds the fair values of identifiable acquired net assets on the date of purchase.

Acquisition-related definite

lived intangible assets are reported at cost, net of accumulated amortization.

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

SIGNIFICANT ACCOUNTING POLICIES (Cont.)

Company’s goodwill reflects the excess of the consideration paid or transferred including the fair value of contingent consideration

over the fair values of the identifiable net assets acquired.

is not amortized but instead is tested for impairment, in accordance with ASC 350, “Intangibles – Goodwill and Other”

(“ASC 350”), at the reporting unit level, at least annually at December 31 each year, or more frequently if events or changes

in circumstances indicate that the carrying value may be impaired.

goodwill impairment test is performed by evaluating an initial qualitative assessment of the likelihood of impairment.

If this step indicates

that the qualitative assessment does not result in a more likely than not indication of impairment, no further impairment testing is

If it does result in a more likely than not indication of impairment, the impairment test is performed.

the impairment test, the Company compares the fair value of the reporting unit to the carrying value of the reporting unit.

value of the reporting unit exceeds the carrying value of the net assets allocated to that unit, goodwill is not impaired, and no further

testing is required.

If the fair value is less than the carrying value of the reporting unit, then the second step of the impairment

test is performed to measure the amount of the impairment.

Intangible assets, other than goodwill

assets are identifiable non-monetary assets that have no physical substance.

Intangible assets with indefinite useful lives are not amortized

and are tested for impairment once a year, or whenever there is a sign indicating that impairment may have occurred, in accordance with

An estimate of the useful life of intangible assets with an indefinite useful life is examined at the end of each reporting

A change in the estimated useful life of an intangible asset that changes from indefinite to defined is treated prospectively.

assets with a defined useful life are amortized in a straight line over their estimated useful life subject to impairment testing.

change in the estimated useful life of an intangible asset with a defined useful life is treated prospectively.

useful life used to amortize intangible assets with a defined useful life is as follows:

OF AMORTIZE INTANGIBLE ASSETS

Customer relations

Internal software

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

SIGNIFICANT ACCOUNTING POLICIES (Cont.)

Impairment of long-lived assets

Company’s long-lived assets to be held or used, including property and equipment, right of use assets and intangible assets subject

to amortization are reviewed for impairment in accordance with ASC 360, “Property, Plants and Equipment” (“ASC 360”),

whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

Recoverability of assets

is measured by a comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated by the

If such asset is considered to be impaired, the impairment to be recognized is measured as the amount by which the carrying amount

of the asset exceeds the fair value of the asset.

Severance Pay

Company’s liability for severance pay for some of its Israeli employees is calculated pursuant to Israeli Severance Pay Law, 1963

(the “Israeli Severance Pay Law”) based on the most recent salary of the employee multiplied by the number of years of employment,

as of the balance sheet date.

These employees are entitled to one month’s salary for each year of employment or a portion thereof.

The Company records the liability as if it were payable at each balance sheet date on an undiscounted basis.

The liability is classified

based on the expected date of settlement and therefore is usually classified as a long-term liability unless the cessation of the employees

is expected during the upcoming year.

Company’s liability for these Israeli employees is partially covered by monthly deposits for insurance policies and the remainder

by an accrual.

The deposited funds for these policies are recorded as an asset in the Company’s balance sheet and include profits

and losses accumulated up to the balance sheet date.

The deposited funds may be withdrawn only upon the fulfillment of the obligation

pursuant to the Israeli Severance Pay Law or labor agreements.

The value of the deposited funds is based on the cash redemption value

of these policies.

respect to other Israeli employees, the Company acts pursuant to the general approval of the Israeli Ministry of Labor and Welfare, pursuant

to the terms of Section 14 of the Israeli Severance Pay Law (“Section 14”), according to which the current deposits with

the pension fund and/or with the insurance company exempt the Company from any additional obligation to these employees for whom the

said depository payments are made.

As a result, the Company does not recognize any liability for severance pay due to these employees

and the deposits under Section 14 are not recorded as an asset in the Company’s balance sheet.

expenses for the nine months ended September 30, 2022, and September 30, 2021, amounted to $ 101

respectively.

Share-based compensation

Company accounts for share-based compensation in accordance with ASC 718, “Stock Compensation” (“ASC 718”), which

requires companies to estimate the fair value of share-based payment awards on the date of grant using an option-pricing model.

of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods, which is

generally the vesting period, in the Company’s condensed consolidated statement of income.

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

SIGNIFICANT ACCOUNTING POLICIES (Cont.)

Share-based compensation (Cont.)

Company selected the Black-Scholes option pricing model as the most appropriate fair value method for its share-options awards.

The option-pricing

model requires several assumptions, of which the most significant are the expected share price volatility and the expected option term.

Company accounts for forfeitures as they occur.

Net earnings per share

accordance with ASC 260, “Earnings Per Share” (“ASC 260”), basic net earnings per share is computed by dividing

net earnings attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period.

net earnings per share reflects the potential dilution that could occur if share options, warrants or other commitments to issue ordinary

shares were exercised or equity awards vested, resulting in the issuance of ordinary shares that could share in the net earnings of the

Segment reporting

Company reports financial and descriptive information about its reportable segments.

Reportable segments are operating segments or aggregations

of operating segments that meet specified criteria as defined in ASC 280, “Segments Reporting”.

segments are distinguishable components of an entity for each of which a separate financial information is available and is reported

in a manner consistent with the internal reporting provided to the entity’s Chief Operating Decision Maker (“CODM”)

in making decisions about how to allocate resources and in assessing performance.

The review of the CODM is carried out according to the results of the segment’s

His review does not include certain expenses that are not related specifically to the activity of each of the segments.

expenses are presented as reconciliation between segments operating results to total operating results in financial statements.

GAAP requires management to make estimates and assumptions that affect the

reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial

statements and the reported amounts of revenue and expenses during the reporting period.

The Company evaluates on an ongoing basis its

assumptions, including those related to contingencies, deferred taxes, inventory impairment, stock-based compensation, as well as in

estimates used in applying the revenue recognition policy.

Actual results may differ from those estimates.

Significant Accounting Policies

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.

Recent Accounting Pronouncements

2019-12, Income Taxes

December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740):

Simplifying the Accounting for Income Taxes.

The amendments in

this ASU simplify the accounting for income taxes, eliminates certain exceptions to the general principles in Topic 740 and clarifies

certain aspects of the current guidance to improve consistent application among reporting entities.

ASU 2019-12 is effective for annual

periods beginning after January 1, 2022 and interim periods within annual periods beginning after January 1, 2023, and early adoption

was permitted.

Company currently does not expect the adoption of this accounting standard will have a material impact on its consolidated financial

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

SIGNIFICANT ACCOUNTING POLICIES (Cont.)

Recent accounting pronouncements (cont.)

2019-10, Financial Instruments—Credit Losses (Topic 326)

September 2016, the Financial Accounting Standards Board (“FASB”) issued ASU No.

2016-13, “Financial Instruments –

Credit Losses (Topic 326)” (“ASU 2016-13”), which requires the immediate recognition of management’s estimates

of current and expected credit losses.

In November 2018, the FASB issued ASU 2018-19, which makes certain improvements to Topic 326.

In April and May 2019, the FASB issued ASUs 2019-04 and 2019-05, respectively, which adds codification improvements and transition relief

for Topic 326.

In November 2019, the FASB issued ASU 2019-10, which delays the effective date of Topic 326 for Smaller Reporting Companies

to interim and annual periods beginning after December 15, 2022, with early adoption permitted.

In November 2019, the FASB issued ASU

2019-11, which makes improvements to certain areas of Topic 326.

In February 2020, the FASB issued ASU 2020-02, which adds an SEC paragraph,

pursuant to the issuance of SEC Staff Accounting Bulletin No.

119, to Topic 326.

amendments in this update are effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal

years, and early adoption is permitted.

The Company currently does not expect that

the adoption of this accounting standard will have a material impact on its consolidated financial statements

2021-08, Business Combinations

October 2021 the FASB issued ASU 2021-08, “Business Combinations (Topic 805) – Accounting for Contract Assets and Contract

Liabilities from Contracts with Customers”.

The amendments in this update require that an entity (acquirer), recognize and measure

contract assets and contract liabilities acquired in a business combination in accordance with Topic 606.

At the acquisition date, an

acquirer should account for the related revenue contracts in accordance with Topic 606 as if it had originated the contracts.

this, an acquirer may assess how the acquiree applied Topic 606 to determine what to record for the acquired revenue contracts.

amendments in this update are effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal

years, and early adoption is permitted.

The Company currently does not expect that

the adoption of this accounting standard will have a material impact on its consolidated financial statements

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

OTHER RECEIBALES

SCHEDULE OF OTHER ACCOUNTS RECEIVABLES COMPOSITION

Prepaid expenses

Government authorities

Other receivables

accounts receivables

PROPERTY AND EQUIPMENT, NET

OF PROPERTY AND EQUIPMENT, NET

Computers and peripheral equipment

Office furniture and equipment

Leasehold improvements

accumulated depreciation

Property and equipment, net

expenses totaled to $ 71 and $ 54 for the nine months ended September 30, 2022, and September 30 2021, respectively.

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect

on the Group’s condensed consolidated financial statements.

TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited

dollars in thousands (except share data)

On February 25, 2021, Gix Media entered into a lease agreement for a new corporate office of 479 square meters in

Ramat Gan, Israel, at a monthly rent fee of $ 10 .

The lease period is for 36 months (the “initial lease period”) with an option

by the Company to extend for two additional terms of 24 months each.

In accordance with the lease agreement, the Company made leasehold

improvements in exchange for a rent fee discount of $ 67 which will be spread over the initial lease period.

The Company includes

renewal options that it is reasonably certain to exercise in the measurement of the lease liabilities.

recorded on the balance sheet consist of the following:

SCHEDULE OF LEASE

Right-of-use assets

Operating lease – current

Operating lease – non-current

Total lease liabilities

LOAN TO PARENT COMPANY

OF LOAN FROM TO PARENT COMPANY

Loan to Parent Company

The balance with the Parent Company represents a balance of an intercompany

loan under a loan agreement signed between Gix Media and the Parent Company on March 22, 2020.

The loan bears interest at a rate to be

determined from time to time in accordance with Section 3(j) of the Income Tax Ordinance, new version, and the Income Tax Regulations

(Determination of Interest Rate for the purposes of Section 3(j), 1986) or according to a market interest rate decision as agreed between

November 20, 2022, the Company, Gix Media and the Parent Company agreed to restructure loan agreements between the parties (see note

15 in the 2022 annual financial statements) such that the Company fully repaid the loan to the Parent Company by offsetting its amount

from the loan owed by the Parent Company to Gix Media.

As a result, as of March 31, 2023, and December 31, 2022, the Company has no further

obligations under the loan agreement with the Parent Company.

the three months ended March 31, 2023, and the year ended 2022, Gix Media recognized interest income in the amount of $ 21 and $ 143 , respectively.

February 25, 2021, Gix Media entered into a lease agreement for a new corporate office of 479 square meters in Ramat Gan, Israel, at

a monthly rent fee of $ 10 .

The lease period is for 36 months (the “initial lease period”) with an option by the Company to

extend for two additional terms of 24 months each.

In accordance with the lease agreement, the Company made leasehold improvements in

exchange for a rent fee discount of $ 67 which will be spread over the initial lease period.

Company includes renewal options that it is reasonably certain to exercise in the measurement of the lease liabilities.

Weighted-average

1 unchanged sentence

SCHEDULE OF WEIGHTED AVERAGE REMAINING LEASE TERMS AND DISCOUNT RATES

September 30,

Operating leases weighted average remaining lease term (in years)

Operating leases weighted average discount rate

of operating lease liabilities as of September 30, 2022 and December 31, 2021, are as follows:

OF MATURITIES OF OPERATING LEASE LIABILITIES

Total lease payments

imputed interest

Present value of lease liabilities

lease expenses amounted to $ 77 and $ 60 for the nine months ended September 30, 2022, and September 30, 2021, respectively.

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

Operating leases weighted average remaining lease term (in years)

Operating leases weighted average discount rate

lease expenses amounted to $ 26 and $ 25 for the three months ended March 31, 2023 and 2022, respectively.

TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited

dollars in thousands (except share data)

GOODWILL AND INTANGIBLE ASSETS

GOODWILL AND INTANGIBLE ASSETS, NET

OF GOODWILL AND INTANGIBLE ASSETS

Internal Software (*)

Internal-use Software ( * )

Customer Relations

Balance as of January 1, 2023

Adjustments to ultimate parent company earning

values (see note 1.c)

Balance as of September 30, 2022

Balance as of March 31, 2023

Accumulated amortization:

1 unchanged sentence

Amortization recognized during the period

Balance as of September 30, 2022

Balance as of March 31, 2023

Amortized cost:

As of September 30, 2022

Internal Software (*)

As of March 31, 2023

Internal-use Software ( * )

Customer Relations

1 unchanged sentence

beginning balance

Acquisition of Cortex (see note 7)

Adjustments to Ultimate Parent company carrying values (see note 1.B)

Balance as of December 31, 2022

4 unchanged sentences

beginning balance

Adjustments to Ultimate Parent company carrying values (see note 1.B)

Amortization recognized during the year

5 unchanged sentences

Amortized cost

During 2020, Gix Media engaged with a subcontractor for the development of an internal software (the “Software”).

Media capitalized its developments costs.

expenses capitalized as of September 30, 2022, and December 31, 2021, were $ 463 and $ 449 , respectively.

March 1, 2022, the Software is available for use.

Accordingly, Gix Media recognized amortization expenses over the estimated useful

life of the Software determined to be three years.

For the period from March 1, 2022, until September 30, 2022, Gix Media recorded

amortization expenses of $ 85 .

The Company estimates the useful life of the software to be amortized over 36 months.

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

BUSINESS COMBINATION

October 13, 2021, Gix Media acquired 70% (on a fully diluted basis) of the shares of Cortex (“Cortex Transaction”), a private

company operating in the field of online media and advertising.

In consideration for Cortex Transaction, Gix Media paid NIS 35 million

in cash (approximately $11 million), out of which an amount of $0.5 million was deposited in trust for a period of 12 months from the

closing date .

Cortex Transaction also included the following main terms:

Media will acquire 30 % of Cortex’s shares in three equal stages, (at the beginning

of 2023, at the beginning of 2024 and at the beginning of 2025) (the “Remaining Balance

Shares”), so that following the completion of the acquisition of all of the Remaining

Balance Shares, Gix Media will hold 100 % of Cortex’s share capital on a fully diluted

obligation (and right) to acquire the Remaining Balance Shares will expire in the event of

an initial public offering of Cortex’s shares or in the event of a 50% or more decrease

in Cortex’s annual net income, for a period of 12 consecutive months, compared to the

net income during the period of 12 months ended July 31, 2021.

As of the date of filling of these financial statements,

this right and obligation has not expired.

Gix Media does not fulfill its obligation to acquire the Remaining Balance Shares, within

90 days from the Designated Acquisition Date as stated above, the selling shareholders of

Cortex (the original shareholders of Cortex) will be released from their obligation not to

sell or transfer their holdings in Cortex to a third party, in relation to the same stage

of the balance of the shares not acquired as aforesaid.

If Gix Media does not fulfilled its

obligation to acquire the Remaining Balance Shares in a certain stage, its right to acquire

the Remaining Balance Shares in the subsequent stage, will be conditioned upon the acquisition

of the Remaining Balance Shares not purchased by it in the previous stage as

well, provided that the Remaining Balance Shares were not transferred or pledged by the selling

shareholders of Cortex to a third party.

Cortex Transaction was financed by Gix Media’s existing cash balances and substantially by debt through a bank financing in

the aggregate amount of $ 9.5

million, that consists of a line of credit of up to $ 3.5

million and a long-term loan of $ 6

million (see note 10).

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

BUSINESS COMBINATION (Cont.)

Acquisition (Cont.)

Value of Cortex’s Identifiable Assets and Liabilities:

OF BUSINESS COMBINATION OF ASSETS AND LIABILITIES

Cash and cash equivalents

Restricted deposits

Trade receivables

Other accounts receivables

Property and Equipment, net

Goodwill arising from the acquisition

Intangible assets

Accounts payables

Short-term loan

Accrued expenses and other current liabilities

Deferred taxes and taxes payable

Non-Controlling Interests

Total liabilities

Total acquisition cost

Media recorded acquisition costs in the amount of $ 197 with respect to Cortex Transaction.

Cash Flow from the Cortex Transaction:

Consideration paid in cash

Less cash and cash equivalents and restricted deposits received from acquisition of Cortex

Total net cash paid

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

ACCOUNTS PAYABLE

OF ACCOUNTS PAYABLE

Trade payables

Accrued expenses

OTHER PAYABLES

OF OTHER ACCOUNTS PAYABLE

Dividend declared

Government authorities

Employees and payroll accruals

Other accounts payable

payable other

the the closing date of the Cortex Transaction, Gix Media entered into a financing agreement with Bank Leumi Le Israel Ltd

(“Leumi”), an Israeli bank, for the provision of a line of credit in the total amount of up to $ 3.5

million and a long-term loan totaling $ 6

million, which Gix Media used to finance the Cortex Transaction (see note 9) (the “Financing Agreement”).

Financing Agreement included the following main terms:

loan of $ 6 million to be provided to Gix Media for a period of 48 months at an annual interest

rate of LIBOR + 4.12 %.

renewable monthly line of credit, of up to $ 3.5

million to be provided to Gix Media, which will be available for utilization for a period of two years and will be determined on a

monthly basis, at 80 %

of Gix Media’s accounts receivable balance (“Line of Credit”).

The amounts that will be withdrawn from the

Line of Credit will bear annual interest of LIBOR

Media undertook to meet financial covenants over the life of the loans as follows:

the ratio of debt to EBITDA, based on the Gix Media’s consolidated financial statements in all 4 consecutive quarters, will

not exceed 2.4 in the first two years and will not exceed 1.75 in the following two years.

As of September 30, 2022, and

December 31, 2021, Gix Media is in compliance with the financial covenants in connection with the Financing Agreement.

part of the Financing Agreement, Gix Media and the Company provided several liens in favor of Leumi (see

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

During 2020, Gix Media engaged with a subcontractor for the development of an internal-use software (the “Software”).

capitalized its developments costs until March 1, 2022 and from this date the Software became available for use.

Accordingly, Gix

Media recognized amortization expenses over the estimated useful life of the Software determined to be three years.

For the three

months ended March 31, 2023, and the period from March 1, 2022, until December 31, 2022, Gix Media recorded amortization expenses of

respectively.

TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited

dollars in thousands (except share data)

LOANS (Cont.)

April 7, 2022, Cortex and Leumi entered into an addendum to an existing loan agreement between the parties, dated August 15, 2021.

part of the addendum to the loan agreement, Leumi provided Cortex with a monthly renewable credit line (the “Additional Credit

Line”) in the amount of up to $ 1,000 , which is an addition to the existing credit

line of $ 1,500 .

The aggregate amount of the credit lines is $ 2,500 (the “Total Credit Line”).

The Total Credit Line was available

for utilization by Cortex until September 24, 2022.

The Total Credit Line was determined every month at the level of 70 %

Financing for Cortex’s capital shares additional Purchase:

January 23, 2023, Gix Media acquired an additional 10% of Cortex’s capital shares (see note 1 .C ) which was financed by Gix Media’s

existing cash balances and by a long-term bank loan received on January 17, 2023, in the amount of $ 1,500 to be repaid in 42 monthly

payments at an annual interest rate of SOFR + 5.37% .

Loan Agreement:

September 21, 2022, Cortex and Leumi entered into an addendum to an existing loan agreement between the parties, dated August 15,

As part of the addendum to the loan agreement, Leumi provided Cortex with a monthly renewable credit line of $ 1,500

(the “Cortex Credit Line”) .

Cortex Credit Line was determined every month at the level of 70 %

of Cortex’s customers’ balance.

The amounts that were drawn from the Additional Credit Line bear an annual interest of SOFR

+ 3.52% (Overnight Financing Rate Secured, guaranteed

daily interest as determined in accordance with the Federal Bank in New York).

The Additional Credit Line was required for the purpose

of increasing the traffic-acquisition and related costs and as part of the continuation growth trend in Cortex’s business

As of September 30, 2022, the Additional Credit Line was not renewed.

July 25, 2022, Gix Media and Leumi entered into an addendum to the Financing Agreement, according to which, Leumi will provide Gix

Media with a loan of $ 1,500 ,

to be withdrawn at the discretion of Gix Media no later than January 31, 2023 (the “Additional Loan”).

Additional Loan will bear an annual interest of SOFR

+ 5.25% to be repaid in 42 equal monthly payments starting from the date of the Additional Loan’s receipt.

The Additional Loan will be used to

purchase an additional 10 %

of Cortex’s shares in accordance with Cortex Transaction.

As of the date of issuance of these financial statements, no

amounts under the Additional Loan were withdrawn.

of long-term loans, short-term loans and line of credit of the Group:

The amounts that are drawn from the Cortex Credit Line bear

an annual interest of SOFR

+ 3.52% (Overnight Financing Rate Secured,

guaranteed daily interest as determined in accordance with the Federal Bank in New York).

of March 31, 2023 and December 31, 2022, the Cortex Credit Line was fully withdrawn (see also note 10).

of long-term loans, short-term loans, and credit lines of the Group:

following is the composition of the balance of the Group’s loans according to their nominal value:

1 unchanged sentence

Interest rate ( * )

March 31, 2023

December 31, 2022

Short-term loan – the Company

Short-term bank loan – Gix Media

1 unchanged sentence

Short-term bank loan – Cortex

Long-term bank loan, including current maturity – Gix Media (received on October 13, 2021)

Long-term bank loan, including current maturity – Gix Media (received on January 23, 2023)

SOFR + 5.37 %

Long-term bank loan, including current maturity – Gix Media

LIBOR + 4.12 %

(*) The LIBOR interest

rate will continue to be published until June 2023 and then will be replaced by the Secured Overnight Financing Rate (“SOFR”).

of the Group’s bank loans as of September 30, 2022, are as follows:

SCHEDULE OF MATURITIES OF DEBT

(*) Includes a sum

of $ 5,000 which is a renewable monthly credit.

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

Tax rates applicable to the income of the Company:

is taxed according to U.S.

December 22, 2017, the U.S.

enacted the Tax Cuts and Jobs Act (the “Act”), which among other provisions, reduced the U.S.

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

Israel is taxed according to Israeli tax laws.

The Israeli corporate

tax rate is 23 % in the years 2022, 2021 and onwards.

Media and Cortex are recognized as a “Preferred-Technology Enterprise” in accordance with Section 51 of the Encouragement

of Capital Investments Law, 1959 and are taxed at a reduced corporate tax rate of 12 %.

of September 30, 2022, Gix Media has a final tax assessment for tax years prior to and including the tax year ended December 31, 2014.

has a final tax assessment for tax years prior to and including the tax year ended December 31, 2018.

Israel has a final tax assessment for tax years prior to and including the tax year ended December 31, 2015.

2022, the Israeli tax authority commenced a tax assessment of Gix Media for the tax years 2017 to 2020.

As of the date of issuance of these financial statements, tax assessment have not been completed.

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

TAXES ON INCOME (Cont.)

Deferred taxes are comprised of the following components:

income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial

reporting purposes and the amounts used for income tax purposes.

taxes are comprised of the following components:

SCHEDULE OF DEFERRED INCOME TAXES

Deferred tax assets

Deferred research and development expenses

Employee compensation and benefits

Operating loss carryforward

Accrued severance pay

Total deferred tax assets

Deferred tax liabilities:

Differences between tax basis and carrying values of loans

Intangible assets associated with business combinations

Total deferred tax liabilities

Net deferred tax assets before valuation allowance

Valuation allowance

Net deferred tax liabilities

of September 30, 2022, the Company has recorded a valuation allowance of $ 7,666

in respect of the deferred tax assets resulting primary from tax loss carryforward of Viewbix Inc., as management currently believes these deferred tax assets will not be released in the foreseeable

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

TAXES ON INCOME (Cont.)

tax expenses are comprised as follows:

OF COMPONENTS OF INCOME TAX EXPENSE (BENEFITS)

For the nine months ended

Current tax expenses

Tax benefit in respect of prior years

Deferred tax income

For the three months ended

Current tax expenses

Taxes expenses (benefit) in respect of previous years

Deferred tax income

Total Income tax expenses

Reconciliation of the theoretical tax expenses to the actual tax expenses:

reconciliation between the theoretical tax expense, assuming all income is taxed at the statutory tax rate applicable to income of the

Company, and the actual tax expense as reported in the statement of operations is as follows:

SCHEDULE OF EFFECTIVE INCOME TAX RATE RECONCILIATION

For the nine months ended

Income before income taxes as reported in the consolidated statements of operations

Statutory tax rate in USA

Theoretical tax expense

Increase (decrease) in tax expenses resulting from:

Lower tax rates for preferred technology enterprises

Non-deductible expenses

Tax benefits in respect of prior years

Change in valuation allowance

Taxes on income

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

LIBOR interest rate will continue to be published until June 2023 and then will be replaced by the Secured Overnight Financing Rate

Short term loan:

December 18, 2020, the Company entered into a loan agreement and Stock Subscription Agreement with certain Investors, pursuant to which

the Investors lent an aggregate amount of $ 69

at an annual interest rate of 8 % (the “Loan”).

January 2023, the Company reached an agreement with the investors that the Loan received will be repaid in 3 equal monthly payments .

As of the date of approval of these financial statements, the Loan was fully repaid by the Company.

TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited

dollars in thousands (except share data)

TAXES ON INCOME (Cont.)

Available carryforward tax losses:

of September 30, 2022 Viewbix Israel incurred operating losses of approximately $ 15,015 which may be carried forward and offset against

taxable income in the future for an indefinite period.

of June 30, 2022 the Company generated net operating losses in the U.S.

of approximately $ 19,000 .

Net operating losses in the U.S.

available through 2035 .

Utilization of U.S.

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.

The annual limitation may result in

the expiration of net operating losses before utilization.

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

SCHEDULE OF LOSS (INCOME) FROM CONTINUING OPERATIONS, BEFORE TAXES ON INCOME

the nine months ended

the three months ended

Total loss before taxes

COMMITMENTS AND CONTINGENCIES

of September 30, 2022, the Company has provided several liens under Gix Media’s Financing Agreement with Leumi in connection

with the Cortex Transaction, as follows:

(1) a guarantee to Bank Leumi of all of Gix Media’s obligations and undertakings to

Bank Leumi unlimited in amount;

September 19, 2022, as part of the Reorganization Transaction terms, the Company has provided several liens under Gix Media’s Financing

Agreement with Leumi in connection with the Cortex Transaction, as follows:

(1) a guarantee to Bank Leumi of all of Gix Media’s

obligations and undertakings to Bank Leumi unlimited in amount;

(2) a subordination letter signed by the company to Leumi Bank;

(3) A first ranking all asset charge

over all of the assets of the Company;

and (4) a Deposit Account Control Agreement over the Company’s bank

Media has provided several liens under the Financing Agreement with Leumi in connection with the acquisition of Cortex Transaction, as

first ranking all asset charge over all of the assets of the Company;

and (4) a Deposit Account Control Agreement over the Company’s

bank accounts.

Media has provided several liens under the Financing Agreement with Leumi in connection with the Cortex Transaction, as follows:

a floating lien on Gix Media’s assets;

(2) a lien on Gix Media’s bank account in Leumi;

(3) a lien on

Gix Media’s rights under the Cortex Transaction;

(3) a lien on Gix Media’s rights

under the Cortex Transaction;

(4) a fixed lien on Gix Media’s intellectual property;

and (5) a lien on

Gix Media’s full holdings in Cortex.

Media restricted deposits in the amount of $ 195

are used as a security in respect of

credit cards, bank guaranties, office lease agreement and hedge transactions on the USD exchange rate.

has a restricted deposit in the amount of $ 27 which is used as a security in respect of its leased offices.

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

and (5) a lien on Gix Media’s full holdings

SHAREHOLDERS’ EQUITY

Ordinary Shares:

shares confer the right to:

(i) participate in the general meetings, to one vote per share for any purpose, to an equal part, on share

basis, (ii) in distribution of dividends and (iii) to equally participate, on share basis, in distribution of excess of assets and funds

from the Company and will not confer other privileges unless stated hereunder or in the Companies Law otherwise.

Some investors

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

following table summarizes information of outstanding warrants as of September 30, 2022:

SUMMARY OF OUTSTANDING WARRANTS

Shares of Common Stock:

of Common Stock confer the rights to:

(i) participate in the general meetings, to one vote per share for any purpose, to an equal part,

on share basis, (ii) in distribution of dividends and (iii) to equally participate, on share basis, in distribution of excess of assets

and funds from the Company and will not confer other privileges.

following table summarizes information of outstanding warrants as of March 31, 2023 and December 31, 2022:

OF OUTSTANDING WARRANTS

Exercise Price

1 unchanged sentence

Class K Warrants

All of the Company’s warrants meet the U.S.

GAAP criteria for equity

classification.

Reverse Stock Split:

August 31, 2022, the

Company filed the Amended COI with the Secretary of State of Delaware to effect a 28 to 1 reverse stock split of the Company’s

outstanding shares of Common Stock .

As a result of the reverse stock split, every 28 shares of the Company’s

outstanding Common Stock prior to the effect of the amended COI was combined and reclassified into one share of the Company’s

shares of Common Stock.

The number of authorized share capital of the Company’s Common Stock and par value of the shares

remained unchanged.

All share and stock options information related to the Company, was adjusted to reflect the reverse stock split

on a retroactive basis.

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

SHAREHOLDERS’ EQUITY (Cont.)

August 31, 2022, the Company filed the Amended COI with the Secretary of State of Delaware to affect a 28 to 1 reverse stock split of

the Company’s outstanding shares of Common Stock.

All share and per share data in these financial statements have been retrospectively

adjusted to reflect the reverse stock split.

Share option plan :

the completion of Gix Media’s acquisition by the Parent Company, the Parent Company granted options to Gix Media’s employees.

These options entitle the employees to purchase ordinary shares of the Parent Company that its shares are traded on Tel-Aviv stock exchange.

summary of Gix Media’s employee share options activity and related information is as follows:

STOCK OPTION ACTIVITY

As of September 30, 2022

As of December 31, 2021

Number of options

Weighted average exercise price

Number of options

Weighted average exercise price

Options outstanding at beginning of the year

Changes during the period:

Expired or forfeited

Outstanding at end of period

Options exercisable at end of period

following tables summarize additional information regarding the Gix Media’s outstanding and exercisable options as of December 31,

SCHEDULE OF OPTION

OUTSTANDING AND EXERCISABLE

Options outstanding

As of September 30, 2022

exercise price

Weighted average

exercise price

average remaining

contractual life (years)

Options Exercisable

As of September 30, 2022

exercise price

Weighted average

exercise price

average remaining

contractual life (years)

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

2017, after the completion of Gix Media’s acquisition by the Parent Company, the Parent Company granted options to Gix Media’s

These options entitle the employees to purchase ordinary shares of the Parent Company that are traded on Tel-Aviv Stock Exchange.

TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited

dollars in thousands (except share data)

SHAREHOLDERS’ EQUITY (Cont.)

Company recognized stock-based compensation expenses related to employee’s stock options in the statement of operations as follows:

OF STOCK BASED COMPENSATION EXPENSES

For the nine months ended

For the three months ended

Research and development

Selling and marketing

General and administrative

the nine months ended September 30,2022, Cortex distributed a dividend in the amount of $ 1,195 to the non-controlling interests.

September 30, 2022, Gix Media declared a dividend in a total amount of $ 1,000 .

As of September 30, 2022, the dividend was not distributed (see note 9).

ADDITIONAL INFORMATION REGARDING TO PROFIT AND LOSS ITEMS

SCHEDULE OF INFORMATION REGARDING TO PROFIT AND LOSS

Research and development expenses:

the nine months ended

the three months ended

Salaries and related expenses

Professional services and subcontractors

Share-based compensation

Research and development

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

ADDITIONAL INFORMATION REGARDING TO PROFIT AND LOSS ITEMS (Cont.)

Sales and marketing expenses:

For the nine months ended

For the three months ended

Salaries and related expenses

Share-based compensation

Advertising and marketing expenses

Sales and marketing expenses:

and administrative expenses:

the nine months ended

the three months ended

Salaries and related expenses

Professional services

Share-based compensation

General and administrative

Financial expenses, net:

For the nine months ended

For the three months ended

Exchange rate differences

Interest income from loan to related party

Financial income

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

ADDITIONAL INFORMATION REGARDING TO PROFIT AND LOSS ITEMS (Cont.)

For the nine months ended

For the three months ended

Bank interest and fees

Interest expense from loans

Exchange rate differences

Financial expenses

LOANS - PARENT COMPANY

Loan to Parent Company:

OF LOAN TO PARENT COMPANY

Loan to Parent Company

balance with the Parent Company represents a balance of an intercompany loan under a loan agreement signed between Gix

Media and the Parent Company (the “Loan”) on March 22, 2020.

The Loan bears interest at a rate to be determined from

time to time in accordance with Section 3(j) of the Income Tax Ordinance, new version, and the Income Tax Regulations (Determination

of Interest Rate for the purposes of Section 3(j), 1986) or according to a market interest rate decision as agreed between the

the nine months ended September 30, 2022, and 2021, Gix Media recognized interest income in respect of the Loan in the amount of $ 110

respectively.

Loan from Parent Company:

OF LOAN TO PARENT COMPANY

Loan from Parent Company

balance with the Parent Company represents certain expenses with respect to the Company’s ongoing operation (mainly salary expenses

and other general and administrative expenses) which were financed by the Parent Company (the “Intercompany Balance”).

Company entered into an agreement with the Parent Company, according to which, effective as of December 31, 2021, the Intercompany Balance

was modified into a loan, which may be increased from time to time, upon the written mutual consent between the Company and the Parent

The Parent Company loan bears interest at a rate equivalent to the minimal interest rate recognized and attributed by the Israel

Tax Authority and will be repaid, together with the accrued interest, in one payment until December 31, 2022, unless extended upon mutual

consent of the Company and the Parent Company.

of September 30, 2022, no amounts were repaid by the Company to the Parent Company.

MAJOR CUSTOMERS

following table sets forth the customers that represent 10% or more of the Group’s total revenues in each of the periods presented

OF TOTAL REVENUES

For the nine months ended

For the three months ended

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

Share option plan (Cont.) :

March 2, 2023, the Company’s Board of Directors (the “Board”) approved the adoption of the 2023 Stock Incentive Plan

(the “2023 Plan”).

The 2023 Plan permits the issuance of up to (i) 2,500,000 shares of Common Stock, plus (ii) an annual

increase equal to the lesser of (A) 5 % of the Company’s outstanding capital stock on the last day of the immediately preceding

calendar year;

and (B) such smaller amount as determined by the Board, provided that no more than 2,500,000 shares of Common Stock may

be issued upon the exercise of Incentive Stock Options.

If any outstanding awards expire, are canceled or are forfeited, the underlying

shares would be available for future grants under the 2023 Plan.

As of the date of approval of the financial statements, the Company

had reserved 2,500,000 shares of Common Stock for issuance under the 2023 Plan.

2023 Plan provides for the grant of stock options, restricted stock, restricted stock units, stock or other stock-based awards, under

various tax regimes, including, without limitation, in compliance with Section 102 and Section 3(i) of the Israeli Income Tax Ordinance

(New Version) 5271-1961, and for awards granted to United States employees or service providers, including those who are deemed to be

residents of the United States for tax purposes, Section 422 and Section 409A of the United States Internal Revenue Code of 1986.

connection with the adoption of the 2023 Plan, on March 7, 2023, the Company entered into certain intercompany reimbursement agreements

with two of its subsidiaries, Viewbix Israel and Gix Media (the “Recharge Agreements”).

The Recharge Agreements provide for

the offer of awards under the 2023 Plan to service providers of Viewbix Israel and Gix Media (the “Affiliates”) under the

Under the Recharge Agreements, the Affiliates will each bear the costs of awards granted to its service providers under the

2023 Plan and will reimburse the Company upon the issuance of shares of Common Stock pursuant to an award, for the costs of shares issued,

but in any event not prior to the vesting of an award.

The reimbursement amount shall be equal to the lower of (a) the book expense for

such award as recorded on the financial statements of one of the respective Affiliates, determined and calculated according to U.S.

or any other financial reporting standard that may be applicable in the future, or (b) the fair value of the shares of Common Stock at

the time of exercise of an option or at the time of vesting of an RSU, as applicable.

of the date of approval of these financial statements, no stock-based awards were granted by the Company under 2023 Plan.

September 14, 2022, Gix Media declared a dividend in the amount of $ 1,000 of which an amount of $ 83 was paid as tax to the Israeli

Tax Authority.

During 2022 Gix Media distributed an amount of $ 787 out of the remaining amount of $ 917 , which an amount of $ 714 that

was distributed to the Parent Company, was offset from the loan to Parent Company (see also note 3).

The remaining amount of $ 130

was distributed by Gix Media in January 2023.

December 25, 2022, Cortex declared a dividend in the total amount of $ 445 to the non-controlling interests.

The amount was distributed

by Cortex to non-controlling interests in two payments of $ 219 and $ 226 in February and March 2023, respectively.

TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited

dollars in thousands (except share data)

SEGMENT REPORTING

Group operates in two different segments in such a way that each company in the Group operates as a separate business segment.

segment - the search segment develops a variety of technological software solutions, which perform automation, optimization

and monetization of internet campaigns, for the purposes of acquiring and routing internet user traffic to its customers.

content segment - the digital content segment is engaged in the creation and editing of content,

in different languages, for different target audiences, for the purposes of generating revenues from leading advertising platforms, including

Google, Facebook, Yahoo and Apple, by utilizing such content to obtain internet user traffic for its advertisers.

Group operates in two different segments in such a way that each company in the Group

operates as a separate business segment.

segment - the search segment develops a variety of technological software solutions, which perform automation, optimization and monetization

of internet campaigns, for the purposes of obtaining and routing internet user traffic to its customers.

content segment - the digital content segment is engaged in the creation and editing of content, in different languages, for different

target audiences, for the purposes of generating revenues from leading advertising platforms, including Google, Facebook, Yahoo and Apple,

by utilizing such content to obtain internet user traffic for its customers.

segments’ results include items that directly serve and/or are used by the segment’s business activity and are directly allocated

4 unchanged sentences

assets and liabilities are not reviewed by the CODM and therefore were not reflected in the segment reporting.

Segments revenues and operating results:

revenues and operating results:

OF SEGMENTS REVENUES AND OPERATING RESULTS

content segment

months ended September 30, 2022

Search segment

Digital content segment

For the three

March 31, 2023

Revenues from external customers

Depreciation and amortization

Segment operating income

Financial expenses, net

Segment operating income (loss)

Financial (expenses) income, net

Segment Income (loss), before income taxes

Taxes on income

Segment net income (loss)

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

SEGMENT REPOTING (Cont.)

Search segment

Digital content segment

Three months ended September 30, 2022

For the three

March 31, 2022

Revenues from external customers

1 unchanged sentence

Segment operating income

Financial expenses, net

Financial (expenses) income, net

Segment Income (loss), before income taxes

Taxes on income

Segment net income (loss)

Reconciliation between segments operating results to total operating results in financial statements:

TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited

dollars in thousands (except share data)

SEGMENT REPORTING (Cont.)

“adjustment” column for segment operating income includes unallocated selling, general, and administrative expenses and certain

items which management excludes from segment results when evaluating segment performance, as follows:

OF RECONCILIATION BETWEEN SEGMENTS OPERATING RESULTS

Nine months ended

Three months ended

Segments total operating results

For the three

Depreciation and amortization expenses not attributable to segments (**)

General and administrative and other costs not attributable to the segments (**)

Finance expenses net, not attributable to the segments (***)

Income (expenses), before income taxes

(*) Mainly consist

of technology and customer relations amortization costs from business combinations (see note 7).

(**) Mainly consist

of salary and related expenses, professional consulting expenses and other expenses in connection with the business combinations and the Reorganization Transaction.

(***) Mainly consist

of financial expenses from the Financing Agreement of bank loans taken for business combinations (see note 10).

General and administrative not attributable to the segments (***)

For the three

Depreciation and amortization expenses not attributable to segments (**)

General and administrative not attributable to the segments (***)

consist of financial expenses from the Financing Agreement of bank loans taken for business combinations (see note 6).

consist of technology and customer relations amortization costs from business combinations.

consist of salary and related expenses, professional consulting expenses and other expenses in connection with the business combinations

and the Reorganization Transaction.

SUBSEQUENT EVENTS

October 2022, Cortex distributed a dividend in the amount of $ 127 to the non-controlling interests.

On April 27, 2023, Leumi increased the Cortex Credit Line by

$ 1,000 , which was fully withdrawn by Cortex.

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