| INVESTMENT AND LOAN TO SOLTERRA |
NOTE
5 – INVESTMENT AND LOAN TO SOLTERRA
| 1. | On
June 30, 2024, the Company entered into a 24 month Loan Agreement with Solterra Renewable
Energy Ltd. (“Solterra”) and other lenders, under which the Company committed
€375
thousand (approximately
$406)
out of a total €500
thousand principal
amount. The loan bears annual interest of 7%,
payable beginning June 30, 2025. Solterra shall have the option to convert the loan into
shares of Solterra Energy Ltd. (“SE”), at the lowest price per share under which
SE raises capital during the period from the Loan Agreement date through conversion. If the
loan is not converted or repaid in full within nine months from the closing date of the merger
involving SE, the interest rate increases to 12%
per annum. |
The
Company elected to account for the Loan Agreement under the fair value option in accordance with ASC 825. As of June 30, 2025, the Company
estimated the fair value of the Loan Agreement at $451,
based on a third-party valuation applying a 27.6%
market discount rate for similar loans. For the six and three months ended on June 30, 2025, the Company recorded gain from changes in
fair value in amount of $101
and $105,
respectively.
The
Company’s chairman of the board of directors also serves as a director of SE.
| 2. | During
2024, the Company acquired 267,000
shares of SE for
a total consideration of NIS801
thousand (approximately
$219). |
The
Company calculated the investment at fair value accordance with ASC 321. The fair value of the investment as of June 30, 2025 was $271,
based on quoted prices in active markets. For the six months ended June 30, 2025, the Company recorded loss from the decrease in the
fair value of the shares in the amount of $36
and for the three months ended June 30, 2025, the Company recorded
gain from the increase in the fair value of the shares in the amount of $41.
|
NOTE
7 – INVESTMENT AND LOAN TO SOLTERRA
| 1. | On
June 30, 2024, the Company entered into a 24 months Loan Agreement (the “Loan Agreement”)
with Solterra Renewable Energy Ltd. (“Solterra”) and certain other lenders (collectively,
the “Lenders”) pursuant to which the Lenders committed to loan Solterra the aggregate
principal amount of € 500
thousands (approximately
$542)
(€ 375
thousands (approximately
$406)
of which was committed by the Company) with interest accruing on the principal at the rate
of 7%
per annum, to be paid annually beginning June 30, 2025 until the repayment of the loan Solterra
shall have the option to convert the Loan Agreement to the shares of Solterra Energy Ltd
(“SE”) (formerly AI Conversation Systems Ltd.) an Israeli company (which merger
was closed at November 24, 2024) at a price which is the lowest price per share of SE under
which it raises capital in in the period starting the date of the Loan Agreement and the
loan conversion. In the event the loan is not converted or repaid in full within 9 months
from the closing date of the merger then the interest rate shall increase from 7%
to 12%
per year. On July 8, 2024, the Company transferred €375
thousands (approximately
$406).
The Company estimated the fair value of the Loan Agreement using a third-party appraiser
by discounting the principal and interest at a discount rate of market interest for similar
loans. The interest rate was determined, among other things, based on the other similar loans
granted to Solterra, at 32.7%
as of December 31, 2024. The Company calculated the fair value of the Loan Agreement at $350
as of December
31, 2024. |
The
Company’s chairman of the board of directors is also a director of SE.
| 2. | On
November 27, 2024, the Company acquired 100,000
shares of SE for a total consideration of NIS 300
thousands (approximately $82).
Subsequently, on December 31, 2024, the Company acquired an additional 167,000
shares of SE for a total consideration of NIS 501 thousands (approximately $137). |
As
of December 31, 2024, the Company recorded gain from the increase in the fair value of the shares in the amount of $88.
|