What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2024-08-14 compared with 2024-05-20 · 496 added, 175 removed, 413 unchanged (62% of the section changed)

29 unchanged sentences

Current maturities of long-term loans

Embedded derivatives

Short-term convertible loans

Other payables

3 unchanged sentences

Long-term loans, net of current maturities

Derivative warrant liability

Operating lease liabilities - long term

6 unchanged sentences

Issued and outstanding:

14,920,585 shares as of March 31, 2024, and December 31, 2023.

15,855,301 and 14,920,585 shares as of June 30, 2024, and December 31, 2023, respectively.

Additional paid-in capital

6 unchanged sentences

dollars in thousands (except share data)

For the three months ended March 31,

Costs and Expenses:

Traffic-acquisition and related costs

Research and development

Selling and marketing

General and administrative

Depreciation and amortization

Other expenses

Operating loss

Financial expense, net

the six months

ended June 30,

the three months

ended June 30,

and Expenses:

Traffic-acquisition

and related costs

and development

and marketing

and administrative

and amortization

income (loss)

(loss) before income taxes

Income tax expense

tax expense (benefit)

net income (loss) attributable to non-controlling interests

Net loss attributable to shareholders of Viewbix Inc.

Net income per share – Basic and diluted attributed to shareholders:

Weighted average number of shares – Basic and diluted:

loss attributable to shareholders of Viewbix Inc.

income per share – Basic and diluted attributed to shareholders:

average number of shares – Basic and diluted

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

4 unchanged sentences

Share-based compensation

Balance as of March 31, 2024

Issuance of shares and warrants in connection

with issuance of convertible loans (see 6.E)

Receipts on account of shares and warrants (see note (see note

Balance as of June 30, 2024

to the company’s

Balance as of April 1, 2024

Share-based compensation

Issuance of shares and warrants in connection with issuance of debt and

convertible debt (see 6.E)

Receipts on account of shares and warrants (see note (see note 12.A)

Balance as of June 30, 2024

Represents an amount less

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)

to the company’s

Balance as of January 1, 2023

Net income (loss)

Share-based compensation

Share-based compensation (see note 9.A)

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

Balance as of March 31, 2023

Dividend declared to non-controlling interests

Balance as of June 30, 2023

to the company’s

Balance as of April 1, 2023

Net income (loss)

Share-based compensation (see note 9.A)

Dividend declared to non-controlling interests

Balance as of June 30, 2023

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

1 unchanged sentence

dollars in thousands (except share data)

For the three months ended March 31,

For the six months

ended June 30,

For the three months

ended June 30,

Cash flows from Operating Activities

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

Depreciation and amortizations

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization

Share-based compensation

3 unchanged sentences

Amortization of loan discount

Amortization of deferred debt issuance costs (see note 6 .E )

Goodwill Impairment

Equity based debt issuance costs (see note 6 .E )

Loss from substantial debt terms modification

(see note 6 .E )

Loss on sale and disposal of property and equipment

Loss from termination of lease agreement

Changes in assets and liabilities items:

Decrease in accounts receivable

Decrease in other current assets

Decrease in operating lease right-of-use asset

Decrease (increase) in accounts receivable

Decrease (increase) in other current assets

Decrease (increase) in operating lease right-of-use asset

Decrease in severance pay, net

Decrease in accounts payable

Increase (decrease) in other payables

Increase (decrease) in accounts payable

Decrease (increase) in other payables

Decrease in operating lease liabilities

3 unchanged sentences

dollars in thousands (except share data)

For the three months ended March 31,

For the six months

ended June 30,

For the three months

ended June 30,

Cash flows from Investing Activities

4 unchanged sentences

Receipt of short-term bank loan

Receipt of short-term loan

Repayment of short-term loans

Receipt of long-term bank loan

Receipt of long-term loans (see note 6.B)

Repayment of long-term bank loans

Payment of dividend to non-controlling interests

Payment of dividend to shareholders

Payment of dividend to shareholders (see note 9.E.1)

Increase in loan to parent company

Net cash used in financing activities

Decrease in cash and cash equivalents and restricted cash

Receipts on account of shares and warrants (see note 12.A)

Net cash provided by (used in) financing activities

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

Cash and cash equivalents and restricted cash at beginning of period

4 unchanged sentences

Total Cash paid during the period

Substantial non-cash activities:

Deemed extinguishment and re-issuance of debt (see note 6.B)

Termination of operating lease agreement (see note 4)

Share-based compensation to a director (see note 9.A)

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

8 unchanged sentences

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

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

detection of skin cancer.

65 unchanged sentences

Subsequent Purchase was recorded as a transaction with non-controlling interests in the Company’s statement of changes in shareholders

equity for the three months ended March 31, 2023.

equity for the six months ended June 30, 2023.

TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

11 unchanged sentences

reserves and lower availability of work force.

Group’s activities are not directly affected by the War, as its customers are predominantly from the US or Europe, markets that

were not influenced by the War.

However, as a result of the War, the Group’s operations were affected due to the recruitment of

some of the Group’s senior employees to reserves, including the CEO of Gix Media.

The absence of senior employees for an extended

period affected customer relationship and operational and functional continuity and delayed some of the Company’s plans for the

fourth quarter of 2023.

These effects indirectly contributed to a decline in the Company’s revenues, profitability, and cash flow.

Company has hired skilled employees to replace those who were recruited to military reserves.

however, there is no assurance that future

developments of the War will not have any impact for reasons beyond the Company’s control such as expansion of the War to additional

regions and the recruitment of more senior employees.

The Company has business continuity procedures in place, and will continue to follow

developments, assessing potential impact, if any, on the Company’s business, financials and operations.

the Group’s customers are mainly in the US and Europe, its operations, revenues, and profitability were indirectly affected due

to recruitment of senior employees to military reserves for an extended period of time.

In January 2024, the Gix Media and Cortex filed

a request with the Israeli Tax Authority (the “ITA”) to receive compensation for the decrease in revenues related to the

In April and May 2024, Gix Media and Cortex received a total of $ 337 from the ITA that were recorded as other income in the Company’s

consolidated statement of operations for the six months period ended June 30, 2024.

of the date of these financial statements the war is still on going.

Therefore, there is no assurance that future developments of the

War will not have any impact for reasons beyond the Company’s control, such as expansion of the War to additional regions and the

recruitment of more senior employees.

The Company has business continuity procedures in place, and will continue to follow developments,

assessing potential impact, if any, on the Company’s business, financials, and operations.

Cortex Adverse Effect

April 2024, the Company was informed by Cortex that a significant customer of Cortex recently notified Cortex it will stop advertising

on Cortex’s sites, as part of its policy decision to cease advertising on Made for Advertising (“MFA”) sites (the “Cortex

Adverse Effect”).

The Cortex Adverse Effect, which has materially affected Cortex’s business and operations, has occurred

following certain recent developments relating to publishers that are categorized by a number of on-line advertisers as MFA, including

decisions made by leading media on-line advertisers to prioritize different media categories and implement publishing restrictions in

connection with MFA.

Due to the Cortex Adverse Effect and additional circumstances as explained in note 5.B, the Company recorded an impairment

of $ 4,739 in the goodwill related to the digital content segment.

TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

GENERAL (Cont.)

Going Concern

Company experienced a decrease in its revenues from the digital content and search segments as a result of a decrease in user

traffic acquired from third party advertising platforms, an industry-wide decrease in advertising budget, changes and updates to

internet browsers’ technology and other changes in the online advertising industry during the second half of 2023 and the

three months ended March 31, 2024.

As a result of the foregoing, during the three months ended March 31, 2024, the Company recorded

an operating loss of $ 1,011 compared

to an operating loss of $ 76 in

the same period last year.

Additionally, the Company recorded a net loss of $ 1,175 compared

the same period last year.

As of March 31, 2024, the Company had cash and cash equivalents of $ 1,284 , bank loans of $ 8,427 and

accumulated deficit of $ 11,660 .

Additionally, subsequent to the balance sheet date, a significant customer notified Cortex it will stop advertising on

Cortex’s websites (see also note 10).

subsequent to the balance sheet date Cortex has successfully taken steps to implement certain adjustments to its business model in response

to such conditions, the decline in revenues and other circumstances described above raise substantial doubts about the Company’s

ability to continue as a going concern during the 12-month period following the issuance date of these financial statements.

plans in response to these conditions include reducing operating expenses, creating new income sources, seeking additional liquidity

opportunities to ensure the Company’s continued operations and raising funds through issuance of debt or equity from various potential

However, there is significant uncertainty as to whether the Company will succeed in implementing its plans, or be able to

secure sufficient funds when needed.

These financial statements do not include any adjustments that might be

necessary if the Company is unable to continue as a going concern.

During the second half of 2023 and the six months ended June 30, 2024 the

Company experienced a decrease in its revenues from the digital content and search segments, as a result of the Cortex Adverse effect

(see note 1.E), a decrease in user traffic acquired from third party advertising platforms, an industry-wide decrease in advertising budget,

changes and updates to internet browsers’ technology, which adversely impacted the Company’s ability to acquire traffic in

the search segment and a decrease in revenues from routing of traffic acquired from third-party strategic partners in the search segment,

as a result of lack of availability of suppliers credit from such third party strategic partners.

As a result of the foregoing, during

the six months ended June 30, 2024, the Company recorded an operating loss of $ 6,490 compared to an operating profit of $ 174 in the six

months ended June 30, 2023.

Additionally, the Company recorded a net loss of $ 9,374 during the six months ended June 30, 2024, compared

to $ 428 in the six months ended June 30, 2023.

As of June 30, 2024, the Company had cash and cash equivalents of $ 609 , bank loans of $ 5,789

and accumulated deficit of $ 18,837 .

decline in revenues and other circumstances described above raise substantial doubts about the Company’s ability to continue as

a going concern during the 12-month period following the issuance date of these financial statements.

Management’s response to these conditions included reduction of salaries

and related expenses and reduction of professional services in the research and development, selling and marketing functions, reduction

of other operational expenses, such as lease costs and overheads, as well as creation of new partnerships and other new income sources.

In addition, during the three months ended June 30, 2024, the company entered into a facility agreement (see Note 6.E) and subsequent

to the balance sheet date raised through a private placement and through two additional facility agreements with certain investors and

lenders (see note 12) aggregate gross proceeds of $ 887 .

Additionally, the Company plans to uplist its shares of common stock to a national

securities exchange (the “Uplist”), after which, in accordance with the terms of the aforesaid private placement and facility

agreements, the company is expected to receive additional funds.

Furthermore, the company’s subsidiaries entered into an addendum

to the loan agreement with Bank Leumi pursuant to which loans repayments were deferred while short term credit lines with Bank Leumi continued

to be utilized.

However, there is significant uncertainty as to whether the Company will further succeed to implement its plans or be

able to secure additional funds when needed.

financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

26 unchanged sentences

Actual results may differ from those estimates.

Derivative Financial Instruments

Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded

derivatives in accordance with ASC Topic 815, “Derivatives and Hedging”.

Derivative instruments are initially recorded at

fair value on the grant date and re-valued at each reporting date, with changes in the fair value reported in the unaudited condensed

statements of operations.

Fair Value of Financial Instruments

value is defined as the price that would be received for sale of an asset or paid to transfer of a liability, in an orderly transaction

between market participants at the measurement date.

US GAAP establishes a three-tier fair value hierarchy, which prioritizes the inputs

used in measuring fair value.

The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets

or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements).

These tiers include:

1, defined as observable inputs such as quoted prices (unadjusted) for identical instruments

in active markets.

2, defined as inputs other than quoted prices in active markets that are either directly

or indirectly observable such as quoted prices for similar instruments in active markets

or quoted prices for identical or similar instruments in markets that are not active;

3, defined as unobservable inputs in which little or no market data exists, therefore requiring

an entity to develop its own assumptions, such as valuations derived from valuation techniques

in which one or more significant inputs or significant value drivers are unobservable.

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.

identical to those applied in the preparation of the latest annual financial statements other than the significant accounting policies of derivative financial instruments and fair value of financial instruments

(see notes 2.D and 2.E above).

Recent Accounting Pronouncements

5 unchanged sentences

SCHEDULE OF LOAN FROM TO PARENT COMPANY

March 31 2024

December 31 2023

9 unchanged sentences

All other terms and conditions of the loan remained unchanged.

the three months ended March 31, 2024 and 2023, Gix Media recognized interest income in the amount of $ 39 and $ 21 , respectively.

the six months ended June 30, 2024 and 2023, Gix Media recognized interest income in the amount of $ 79 and $ 43 , 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

7 unchanged sentences

the Company exercised the option to extend the lease period for an additional term of 24 months (from March 1, 2024, to February 28,

Weighted-average

remaining lease term and discount rate were as follows:

OF WEIGHTED AVERAGE REMAINING LEASE TERMS AND DISCOUNT RATES

March 31 2024

Operating leases weighted average remaining lease term (in years)

Operating leases weighted average discount rate

December 31 2023

Operating leases weighted average remaining lease term (in years)

Operating leases weighted average discount rate

lease expenses amounted to $ 28 and $ 26 for the three months ended March 31, 2024 and 2023, respectively.

On June 20, 2024, Gix Media

and the lessor of its offices entered into a lease termination agreement.

According to the agreement, the lease, which originally had

a termination date of February 28, 2026, terminated on June 30, 2024.

In compensation for the lessor’s consent to early termination

Gix Media paid to the lessor $ 7 in cash and $ 62 in office furniture and equipment, as per the carrying values of such assets on the Company’s

books as of the early termination date.

As a result of the early termination of the agreement, the Company recorded

a capital loss of $ 46 in other expenses in its statement of operations for the six months period ended June 30, 2024.

TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

1 unchanged sentence

GOODWILL AND INTANGIBLE ASSETS, NET

OF GOODWILL AND INTANGIBLE ASSETS

SCHEDULE OF GOODWILL AND INTANGIBLE ASSETS

Internal-use Software

1 unchanged sentence

Balance as of January 1, 2024

Balance as of March 31, 2024

Impairment of goodwill

Balance as of June 30, 2024

Accumulated amortization:

1 unchanged sentence

Amortization recognized during the period

Balance as of March 31, 2024

Balance as of June 30, 2024

Amortized cost:

As of March 31, 2024

as of January 1, 2023

as of December 31, 2023

amortization:

as of January 1, 2023

recognized during the year

As of June 30, 2024

Internal-use Software

Customer Relations

Balance as of January 1, 2023

Cost, beginning balance

Impairment of goodwill

Balance as of December 31, 2023

Cost, ending balance

Accumulated amortization:

Balance as of January 1, 2023

Accumulated amortization, beginning balance

Amortization recognized during the year

Balance as of December 31, 2023

Accumulated amortization, ending balance

Amortized cost:

As of December 31, 2023

of December 31, 2023

of December 31, 2023, the Company recognized indicators of impairment of the digital content reporting unit.

As a result, the

Company performed an impairment test which included a quantitative analysis of the fair value of the reporting unit and compared the

fair value of the reporting unit to its carrying amount.

As the carrying amount exceeded the fair value, the Company recognized an

impairment loss of $ 5,107 .

The assessment of impairment loss was not impacted by subsequent events that occurred in April 2024 (see note 10),

which may result in an additional goodwill impairment loss during the second quarter of 2024.

Amortized cost

TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

of long-term and short-term loans of the Group:

OF COMPOSITION OF BALANCE OF GROUP’S LOANS

GOODWILL AND INTANGIBLE ASSETS, NET (Cont.)

Impairment of goodwill:

of June 30, 2024, the Company identified indicators of impairment of the digital content reporting unit.

As a result, the Company

performed an impairment test which included a quantitative analysis of the fair value of the reporting unit.

The fair value was

estimated using the income approach, which is based on the present value of the future cash flows attributable to the reporting

The Company compared the fair value of the reporting unit to its carrying amount.

As the carrying amount exceeded the fair

value, the Company recognized an impairment loss of $ 4,739

which was driven mainly due to the Cortex Adverse Effect (see note 1.E) and due to a decrease in the cash flow projections.

of December 31, 2023, the Company recognized an impairment loss of $ 5,107 related to the digital content reporting unit.

Composition of long-term

and short-term loans of the Group:

SCHEDULE OF COMPOSITION OF BALANCE OF GROUP’S LOANS

Interest rate

March 31, 2024

June 30, 2024

December 31, 2023

1 unchanged sentence

SOFR + 4.25 %

Short-term bank loan – Gix Media (received on June 13, 2024)

SOFR + 4.08 %

Short-term bank loan – Cortex

8 unchanged sentences

Long-term loan

Financing for Cortex’s capital shares additional Purchase:

Short-term convertible loan -

June 2024 Facility Agreement – Viewbix Inc

Line of credit

Gix Media’s Loan

January 23, 2023, Gix Media acquired an additional 10 % of Cortex’s capital shares which was financed by Gix Media’s existing

1 unchanged sentence

at an annual interest rate of SOFR + 5.37 %.

Loan Agreement:

June 13, 2024, Gix Media and Leumi entered into an addendum to an existing loan agreement between the parties which was be effective

from May 15, 2024, pursuant to which, inter alia:

(i) the addendum will be effective until August 31, 2024;

(ii) the Company is

obligated to transfer to Gix Media $ 600 ;

(iii) a new covenant, measured by reference to positive EBTIDA was implemented;

(iv) all payments due to Leumi Long-term bank loan

were deferred to August 31, 2024 and from September 1, 2024, payments will be repaid as schedule until the end of the Long-term bank

(v) a new $ 350

loan was granted to Gix Media on June 13, 2024, to be repaid until August 30, 2024, alongside the existing credit facility to Gix

Media, which remains equal to 80 %

of Gix Media’s customer balance;

(vi) Gix Media is obligated to perform a reduction in expenses, including reduction in

Cortex’s Loan

September 21, 2022, Cortex and Leumi entered into an addendum to an existing loan agreement between the parties, dated August 15, 2020

9 unchanged sentences

The amounts that are drawn from the Cortex Credit Line bear an annual interest of SOFR + 4.08 %.

of March 31, 2024, Cortex has drawn $ 1,300 of the Cortex Credit Line.

May 27, 2024, Cortex and Leumi entered into an amendment to Cortex Loan Agreement, pursuant to which, the credit facility to Cortex will

be 80 % of Cortex’s customer balance and up to $ 2,000 .

of June 30, 2024, Cortex has drawn $ 800 of the Cortex Credit Line.

TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

1 unchanged sentence

LOANS (Cont.)

term loan and issuance of warrants:

November 15, 2023, Viewbix Israel entered into a Loan Agreement (the “2023 Loan”) with certain lenders (the “Lenders”)

whereby the Lenders provided Viewbix Israel with loans in the aggregate amount of $ 480 , of which, $ 200 was provided by the Ultimate Parent.

In accordance with the terms of the 2023 Loan, the principal amount bears an annual interest at a rate of 9 % and will be repaid over

the course of two years following January 1, 2024 (the “Repayment Period”).

During the Repayment Period, for the first 12

months, Viewbix Israel will repay the interest on a quarterly basis and for the remaining 12 months, Viewbix Israel will repay the principal

amount on a quarterly basis (in 4 equal payments) along with the interest.

If Viewbix Israel fails to repay all or part of the 2023 Loan

amount, the Lenders have the option to convert the outstanding 2023 Loan amount into shares of Common Stock of the Company.

connection with the 2023 Loan, the Company issued to each lender a warrant to purchase shares of Common Stock (the “2023 Warrants”).

The 2023 Warrants are exercisable to 480,000 shares, at an exercise price of $ 0.50 per share and will expire and cease to be exercisable

on December 31, 2025 .

The Company recorded the 2023 Warrants as an equity instrument.

Company allocated the total amount of $ 480 in respect of the warrants issued and the 2023 Loan extended based on their relative fair

As a result of the allocation, a discount of $ 55 was attributed as the fair value of the 2023 Warrants.

The discount is amortized

over the term of the Loan as finance expense.

allocation of the total proceeds of $ 480 to the liability and equity components was as follows:

OF FAIR VALUE DISTRIBUTION OF LIABILITY AND EQUITY COMPONENTS

composition of long-term loan balance as of the transaction is as follows:

OF COMPOSITION OF LONG TERM LOAN

Long term loan, net

the three months ended March 31, 2024, the Company recorded amortization expenses of $ 2 as financial expenses in the consolidated statements

of operations.

Long term loan and issuance

On November 15, 2023, Viewbix Israel entered

into a Loan Agreement (the “2023 Loan”) with certain lenders (the “Lenders”) whereby the Lenders provided Viewbix

Israel with loans in the aggregate amount of $ 480 .

In connection with the 2023 Loan, the Company issued to each lender a warrant to purchase

shares of common stock (the “2023 Warrants”).

The 2023 Warrants are exercisable to 480,000 shares of common stock, at an exercise

price of $ 0.50 per share and will expire and cease to be exercisable on December 31, 2025 .

The Company recorded the 2023 Warrants as an

equity instrument.

terms of the 2023 Loan were substantially amended on June 18, 2024, by the June 2024 Facility Agreement (see note 6.E).

amendments represent a substantial modification in accordance with ASC Topic 470.

Accordingly, the terms modification was accounted

for as an extinguishment of the original financial liability and the initial recognition of new financial instruments issued at

their fair value as of the effective date of the June 2024 Facility Agreement.

As a result of the substantial modification of terms,

the Company recognized finance expense of $2,515 in its interim condensed consolidated statement of operations for the six months

period ended June 30, 2024.

LOANS (Cont.)

June 2024 Facility Agreement:

June 18, 2024, the Company entered into a credit facility agreement which was amended and restated on July 22, 2024 (the “June

2024 Facility Agreement”) for a $ 1 million credit facility (the “June 2024 Facility Loan Amount”) with a group of lenders

including L.I.A.

Pure Capital Ltd (the “June 2024 Lead Lender”, and collectively, the “June 2024 Lenders”).

addition to the June 2024 Facility Loan Amount, the June 2024 Facility Agreement includes $ 531 of outstanding debt owed by the Company

to the June 2024 Lenders (the “June 2024 Prior Loan Amount”, and together with the June 2024 Facility Loan Amount, the “June

2024 Loan Amount”).

term (the “June 2024 Facility Term”) of the June 2024 Facility Agreement expires 12

months following the date of the June 2024 Facility Agreement (the “Initial Maturity Date”), provided that, if the

effectiveness of an uplisting of the Company’s shares of common stock to a national securities exchange (the

“Uplist”) occurs prior to the Initial Maturity Date, the June 2024 Facility Term will expire 12

months following the effective date of the Uplist.

The June 2024 Facility Agreement sets forth a drawdown schedule as follows:

an aggregate amount of $350 was drawn down on the date of the Prior June 2024 Facility Agreement, (ii) an aggregate amount of

$150 drawn down upon the filing of the Company’s PIPE Registration Statement (as defined in note 12.A) and (iii) an amount of

$500 drawn down upon the effectiveness of the Uplist.

June 2024 Facility Loan Amount accrues interest at a rate of 12 % per annum, and the Company will also pay such interest on the June 2024

Prior Loan Amount, which is equal to $ 184 (the “June 2024 Facility Interest”).

The June 2024 Facility Interest was paid

in advance for the first year of the June 2024 Facility in (i) shares of the Company’s common stock at a conversion rate of $ 0.25

for each U.S.

dollar of June 2024 Facility Interest accrued on the respective June 2024 Loan Amount, equal to an aggregate of 734,716

shares of common stock (the “June 2024 Facility Shares”) and (b) a warrant to purchase a number of shares of common stock

equal to the June 2024 Facility Shares (the “June 2024 Facility Warrant”).

following the effectiveness of the Uplist, (i) $ 663 of

the June 2024 Loan Amount will convert into shares of common stock at a conversion rate equal to $ 0.25 per

share of the Company’s common stock (the “June 2024 Convertible Stock”) and (ii) the company will issue a warrant

in substantially the same form and on substantially the same terms as a June 2024 Facility Warrant to purchase a number of shares of

the Company’s common stock equal to the June 2024 Convertible Stock with an exercise price of $ 0.25 per

share (the “June 2024 Conversion Warrant”, and (i) and (ii), collectively a “June 2024 Conversion Unit”).

Such portion of the June 2024 Loan Amount that is not converted into a June 2024 Conversion Unit will remain outstanding and will

not convert following the Uplist.

For the duration of the June 2024 Facility Term of the June 2024 Facility Agreement, the June 2024

Lenders may elect to convert after the effectiveness of the Uplist such unconverted portion of the June 2024 Loan Amount into

additional June 2024 Conversion Units or, upon the expiration of the June 2024 Facility Term, such unconverted portion of the June

2024 Loan Amount will be repaid in accordance with the terms of the June 2024 Facility Agreement.

June 2024 Facility Warrants are exercisable upon issuance at an exercise price of $ 0.25 per share of common stock and will have a three-year

term from the issuance date.

addition and in connection with the June 2024 Facility Agreement, the Company agreed to pay the June 2024 Lead Lender a commission consisting

of (i) 200,000 shares of common stock, (ii) a warrant in substantially the same form and on substantially the same terms as the June

2024 Facility Warrant to purchase 200,000 shares of common stock with an exercise price of $ 0.25 per share (the “June 2024 Lead

Lender Warrant”) and (iii) a warrant to purchase 2,500,000 shares of common stock with an exercise price of $ 1.00 per share, representing

an aggregate exercise amount of $ 2.5 million, subject to beneficial ownership limitations and adjustments (the “June 2024 Lead

Lender Fee Warrant” and together with the June 2024 Lead Lender Warrant and the June 2024 Facility Warrants, the “June 2024

Warrants”) see also note 12.B.

The conversion and conversion related features of the June 2024 facility

loan were bifurcated from their host debt contract and recognized as liabilities measured at fair value at each cut-off date.

loan was initially recorded at its fair value and subsequently measured at cost.

The shares and Warrants A issued as prepayment of interest

and as commission to the 2024 Lead Lender were initially recognized at fair value and classified in equity.

The June 2024 Lead Lender

Warrant was initially recognized at fair value and classified as a liability measured at fair value at each cut-off date (see note 7).

TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

FINANCIAL INSTRUMENTS AT FAIR VALUE

Company has financial instruments measured at level 3 from the June 2024 Facility Agreement (see note 6.E).

fair value of the financial instruments under the June 2024 Facility Agreement, as of June 18, 2024, was

calculated using the following unobservable inputs:

$ 0.118 , expected volatility:

125 %, exercise price:

$ 0.25 , risk-free

interest rate:

4.41 % , expected life:

fair value of the financial instruments estimated by the Company’s management as of June 30 and June 18, 2024, was substantially

following table presents the financial liabilities that were measured at fair value through profit or loss:

OF FINANCIAL LIABILITIES

December 31, 2023

Embedded derivatives

Derivative warrant liability

Total financial liabilities

COMMITMENTS AND CONTINGENCIES

14 unchanged sentences

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

Media restricted deposits in the amount of $ 52 as of March 31, 2024, are used as a security in respect of credit cards, bank guaranties,

office lease agreement and hedge transactions on the USD exchange rate.

Cortex has a restricted deposit in the amount of $ 34 as of March

31, 2024, is used as a security in respect of its leased offices.

Media restricted deposits in the amount of $ 8 as of June 30, 2024, are used as a security in respect of credit cards.

Cortex has a restricted

deposit in the amount of $ 34 as of June 30, 2024, is used as a security in respect of its leased offices.

SHAREHOLDERS’ EQUITY

11 unchanged sentences

to the Equity Grant.

following table summarizes information of outstanding warrants as of March 31, 2024:

OF OUTSTANDING WARRANTS

June 18, 2024, as part of the June 2024 Facility Agreement the Company issued to June 2024 Lenders 934,716 shares of common stock and

934,716 warrant to purchase shares of common stock with an exercise price of $ 0.25 per share.

In addition, the Company issued to the

June 2024 Lead Lender a warrant to purchase 2,500,000 shares of common stock with an exercise price of $ 1.00 per share, representing

an aggregate exercise amount of $ 2.5 million.

following table summarizes information of outstanding warrants as of June 30, 2024:

SCHEDULE OF OUTSTANDING WARRANTS

Exercise Price

3 unchanged sentences

December 2025

June 2024 Facility Agreement Warrants

June 2024 Lead Lender Warrants (see note 12.B)

TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

37 unchanged sentences

Commencement Date (the “First Tranche”) and the remaining 50% of the RSUs will vest 12 months after the Vesting Commencement

Date, provided, in each case, that the Grantee remains continuously as a Service Provider (as defined under the 2023 Plan) of Gix Media

or its affiliates throughout each such vesting date (the “Grant”).

Date (the “Second Tranche”), provided, in each case, that the Grantee remains continuously as a Service Provider (as defined

under the 2023 Plan) of Gix Media or its affiliates throughout each such vesting date (the “Grant”).

TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

2 unchanged sentences

Share option plan (Cont.)

July 2023, following the Grant and upon the vesting of the First Tranche, the Company issued 25,510 shares of Common Stock to the Grantee.

The Company recorded a share-based compensation expense of $ 25 in general and administrative expenses with connection to the issuance

of shares upon the vesting of the First Tranche.

July 1, 2023, following the Grant and upon the vesting of the First Tranche, the Company issued 25,510 shares of Common Stock to the

The Company recorded a share-based compensation expense of $ 25 in general and administrative expenses with connection to the

issuance of shares upon the vesting of the First Tranche.

Subsequent to the balance sheet date, upon the vesting of the Second Tranche,

the Company issued 25,510 shares of Common Stock to the Grantee (see note 12.G).

September 14, 2022, Gix Media declared a dividend to its shareholders prior to the consummation of the Reorganization Transaction in

7 unchanged sentences

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

dividends were distributed during the three-month period ending March 31, 2024.

dividends were distributed during the six-month period ending June 30, 2024.

TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

FINANCIAL EXPENSE, NET

OF FINANCIAL EXPENSE NET

For the six months

ended June 30,

For the three months

ended June 30,

Financial expense (income):

Exchange rate differences

Interest expense on bank loans

Loss from substantial debt terms modification

Interest income on loans from Parent Company

Financial expense, net

SEGMENT REPORTING

12 unchanged sentences

revenues and operating results:

OF SEGMENTS REVENUES AND OPERATING RESULTS

SCHEDULE OF SEGMENTS REVENUES AND OPERATING RESULTS

Search segment

Digital content segment

For the three

March 31, 2024

For the six months ended June 30, 2024

Search segment

Revenues from external customers

Depreciation and amortization

Goodwill Impairment

Segment operating income (loss)

Financial (expenses) income, net

Financial expenses, net

Segment Income (loss), before income taxes

Search segment

Digital content segment

For the three

March 31, 2023

For the six months ended June 30, 2023

Search segment

Revenues from external customers

1 unchanged sentence

Segment operating income (loss)

Financial (expenses) income, net

Financial expenses, net

Segment Income (loss), before income taxes

consist of financial expenses from the Financing Agreement of bank loans taken for business

combinations (see note 6).

TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

1 unchanged sentence

SEGMENT REPORTING (Cont.)

Search segment

For the three months ended June 30, 2024

Search segment

Revenues from external customers

Depreciation and amortization

Goodwill Impairment

Segment operating income (loss)

Financial expenses, net

Segment Income (loss), before income taxes

Search segment

For the three months ended June 30, 2023

Search segment

Revenues from external customers

Depreciation and amortization

Segment operating income (loss)

Financial expenses, net

Segment Income (loss), before income taxes

Mainly consist of financial

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

“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

SCHEDULE OF RECONCILIATION BETWEEN SEGMENTS OPERATING RESULTS

June 30, 2024

For the three

March 31, 2024

June 30, 2024

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

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

Goodwill Impairment

TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

SEGMENT REPORTING (Cont.)

June 30, 2023

For the three

March 31, 2023

June 30, 2023

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 and professional consulting expenses.

Mainly consist of financial

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

Mainly consist of technology

and customer relations amortization costs from business combinations.

Mainly consist of salary

and related expenses and professional consulting expenses.

TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

SUBSEQUENT EVENTS

April 2024, the Company was informed by Cortex that a significant customer of Cortex recently notified Cortex it will stop advertising

on Cortex’s sites, as part of its policy decision to cease advertising on Made for Advertising (“MFA”) sites (the “Cortex Adverse Effect”).

Adverse Effect, which has materially affected Cortex’s business and operations, has occurred following certain recent developments

relating to publishers that are categorized by a number of on-line advertisers as MFA, including decisions made by leading media on-line

advertisers to prioritize different media categories and implement publishing restrictions in connection with MFA.

the Cortex Adverse Effect, the Company and the bank in which Cortex’s and Gix Media’s accounts, credit facilities, and loans

are maintained approved on May 20, 2024 a debt restructuring program pursuant to which, inter alia, the credit lines to Cortex were increased

to 80% of the balance of Cortex’s customers (up to a limit of $ 2 million), as opposed to the 70% limitation imposed prior to the

restructuring program, Gix Media’s monthly revolving credit lines were increased by an additional $ 300 thousand, the Company committed

to perform cost-cutting measures, including a reduction in head count, the Company will raise up to $ 1.25 million by means of issuance

of equity or debt, the covenants under the original loan agreements as of March 31, 2024 were waived and a new covenant, measured by

reference to EBTIDA, was implemented, and a grace in relation to a portion of the monthly loan repayments was given.

The debt restructuring

program will be in effect until August 2024, after which it will be renegotiated between the Company and the bank.

Private Placement

July 3, 2024, the Company entered into a definitive securities purchase agreement (the “Purchase Agreement”) with a certain

investor (the “Lead Investor”) for the purchase and sale in a private placement (the “Private Placement”) of

units consisting of (i) 1,027,500 shares of the Company’s common stock at a purchase price of $ 0.25 per share (the “PIPE

Shares”) and (ii) common stock purchase warrants to purchase up to 1,541,250 shares of the Company’s common stock (the “PIPE

Warrants”) to the Lead Investor and other investors (collectively, the “Investors”) acceptable to the Lead Investor

and the Company.

aggregate gross proceeds received by the Company from the Private Placement were $ 257 ,

of which $237 received in June 2024 and the $20 remaining received in July 2024 .

The PIPE Warrants are exercisable upon issuance at an exercise price of $ 0.25 per

share and will have a three-year term

from the issuance date.

In addition, the PIPE Warrants are subject to an automatic exercise provision in the event that the

Company’s shares of common stock are approved for listing on the Nasdaq Capital Market.

the closing of the Private Placement, the Company agreed to pay the Lead Investor:

(1) $ 10 for actual and documented fees and expenses

incurred and, (2) a commission consisting of (i) a cash fee of $ 123 and (ii) 51,375 shares of the Company’s common stock.

July 2024, the Company issued to the Investors 1,027,500 shares of common stock and 1,541,250 warrants in connection with the Private

TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

SUBSEQUENT EVENTS (Cont.)

June 2024 Facility Agreement

the closing of the Private Placement (as defined in note 12.A), the exercise price of the June 2024 Lead Lender Warrant was adjusted

to $ 0.118 , which is the effective price per share of common stock in the Private Placement, and the number of shares of common stock

issuable upon the exercise of the June 2024 Lead Lender Warrant was also adjusted to a total of 21,186,440 shares, such that the adjusted

exercise price and number of warrants issued is equal to an aggregate amount of $ 2.5 million.

First July 2024 Facility Agreement

July 4, 2024, the Company entered into a credit facility agreement, as restated on July 22, 2024, and amended on July 25, 2024 (the “First

July 2024 Facility Agreement”) for a $ 2.5 million (the “First July 2024 Facility Loan Amount”) with a certain lender.

First July 2024 Facility Loan Amount will remain available until the earliest of (a)(i) its drawing down in full, (ii) the 36-month anniversary

of the First July 2024 Facility Agreement and (b) upon such date that the Company completes a $ 2.0 million financing transaction (the

“First July 2024 Facility Term”).

In the event the First July 2024 Facility Term lapses, the First July 2024 Facility Loan

Amount will be repaid to the lender immediately.

First July 2024 Facility Agreement sets forth a drawdown schedule as follows:

(i) an aggregate of $50,000 was drawn down on July 4, 2024,

(ii) an aggregate of $50 will be drawn down upon the effectiveness of the Uplist (see note 6.E), and (iii) following the Uplist, an

aggregate of $200 will be drawn down on a quarterly basis until the First July 2024 Facility Loan Amount is exhausted.

First July 2024 Facility Amount will accrue interest at a rate of 12 % per annum.

The interest for the first year was paid in advance

in (i) 1,200,000 shares of the Company’s common stock at a conversion rate of $ 0.25 , and (ii) 1,200,000 warrants to purchase such

number of shares of the Company’s common stock at a conversion rate of $ 0.25 (the “First July 2024 Facility Warrants”).

The First July 2024 Facility Warrants are exercisable upon issuance at an exercise price of $ 0.25 per share of common stock and will

have a three-year term from the issuance date.

TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

SUBSEQUENT EVENTS (Cont.)

First July 2024 Facility Agreement (Cont.)

following the effectiveness of the Uplist, (i) $ 100 of the First July 2024 Facility Loan Amount will convert in shares of common

stock at a conversion rate of $ 0.25 per share (such amount of shares converted, the “First July 2024 Convertible Stock”),

and, (ii) the Company will issue a warrant to purchase such amount of First July 2024 Convertible Stock, with an exercise price of $ 0.25

per share (the “First July 2024 Conversion Warrant”).

The remaining First July 2024 Facility Loan Amount outstanding and

not converted following the Uplist will remain available for the duration of the First July 2024 Facility Term, whereby, upon the lapse

of the First July 2024 Facility Term, such amount will be repaid to the First July 2024 Lender.

addition, the Company agreed to pay the First July 2024 Lender a one-time fee consisting of:

(i) 500,000 shares of the Company’s

common stock, representing five percent ( 5 %) of the First July 2024 Facility Loan Amount at a conversion rate of $ 0.25 and (ii) a warrant

to purchase 1,000,000 shares of the Company’s common stock with an exercise price of $ 0.25 per share.

Services Agreements

July 14, 2024 and July 25, 2024, the Company entered into consulting agreements with certain consultants (the

“Consultants”) pursuant to which the Consultants agreed to provide certain services to the Company in connection with

In consideration with the Consultants’ services, the Company issued to the Consultants 480,000

shares of common stock in July 2024.

Second July 2024 Facility Agreement

July 28, 2024, the Company entered into a credit facility agreement (the “Second July 2024 Facility Agreement”) for a $ 3.0

million (the “Second July 2024 Facility Loan Amount”) with certain lenders (the “Second July 2024 Lenders”).

Second July 2024 Facility Loan Amount will remain available until the earliest of (a)(i) its drawing down in full, (ii) the 40-month

anniversary of the Second July 2024 Facility Agreement and (b) upon such date that the Company completes a $ 2.5 million financing transaction

(the “Second July 2024 Facility Term”).

In the event the Second July 2024 Facility Term lapses, the Second July 2024 Facility

Loan Amount will be repaid to the Second July 2024 Lenders immediately thereafter.

TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

dollars in thousands (except share data)

SUBSEQUENT EVENTS (Cont.)

Second July 2024 Facility Agreement (cont.)

Second July 2024 Facility Loan Amount will accrue interest at a rate of 12 % per annum.

The interest for the first year was paid in advance

in (i) 1,440,000 shares of the Company’s common stock at a conversion rate of $ 0.25 , and (ii) 1,440,000 warrants to purchase such

number of shares of the Company’s common stock at a conversion rate of $ 0.25 (the “Second July 2024 Facility Warrants”).

the interest for the second year will be paid by the Company in cash.

The Second July 2024 Facility Warrants are exercisable upon issuance

at an exercise price of $ 0.25 per share of common stock, and will have a three-year term from the issuance date.

following the effectiveness of the Uplist, (i) $ 160 of the Second July 2024 Facility Loan Amount will convert in shares of common

stock at a conversion rate of $ 0.25 per share (such amount of shares converted, the “Second July 2024 Convertible Stock”),

and, (ii) the Company will issue a warrant to purchase such amount of Second July 2024 Convertible Stock, with an exercise price of $ 0.25

per share (the “Second July 2024 Conversion Warrant”).

The remaining Second July 2024 Facility Loan Amount outstanding and

not converted following the Second Uplist Conversion will remain available for the duration of the Second July 2024 Facility Term, whereby,

upon the lapse of the Second July 2024 Facility Term, such amount will be repaid to the Second July 2024 Lenders.

addition, the Company agreed to pay the Second July 2024 Lenders a one-time fee consisting of 600,000 shares of the Company’s common

stock, representing five percent ( 5 %) of the Second July 2024 Facility Loan Amount at a conversion rate of $ 0.25 .

Securities Exchange Agreement

July 31, 2024, the Company entered into a Securities Exchange Agreement, with Metagramm Software Ltd.

(“Metagramm”) pursuant

to which the Company agreed to issue to Metagramm 9.99 % of its issued and outstanding share capital in exchange for 19.99 % of Metagramm’s

issued and outstanding share capital.

The transactions contemplated by the Securities Exchange Agreement are expected to close following

the Uplist (as defined in note 6.E).

Grant of shares

July 1, 2024, the Company issued 25,510 shares of Common Stock to Gix Media’s CEO.

Reverse stock split

July 15, 2024, the Company filed an amendment to its Certificate of Incorporation (the “Amendment”) to effect a 1-for-4 reverse

stock split of the Company’s Common Stock.

As of the issuance date of this interim condensed consolidated financial statements,

the reverse stock split is not yet effective.

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