NOTE 5: - LOAN FROM THE EIB

On April 29, 2020, the German Subsidiary entered the Finance Contract with the EIB, which provided for funding of up to €50 million, payable in three tranches. In June 2021, we received the first tranche in the amount of €20 million, which represents the only amount disbursed under the EIB finance agreement, as the initial funding period expired on December 31, 2022, and no additional funds were made available thereunder.

The amount received was due on June 1, 2026, and bears annual interest of 4% to be paid with the principal of the Loan. In addition to the interest, the EIB is entitled to royalty payments, pro-rated to the amount disbursed from the Loan, on our consolidated revenues from fiscal year 2024 through fiscal year 2030, at rates of up to 2.3% on consolidated revenues below $350 million, 1.2% on consolidated revenues between $350 million and $500 million, and 0.2% on consolidated revenues exceeding $500 million. As of September 30, 2026, the linked principal balance in the amount of $22,692 and the interest accrued in the amount of $4,836 are presented among short-term liabilities. As of September 30, 2026, and June 30, 2026, the Company had an accrued royalty in the amount of $16 and $9, respectively.

The Finance Contract also provides for certain limitations such as the use of proceeds received from the EIB, limitations related to disposal of assets, substantive changes in the nature of the Company’s business, changes in holding structure, distributions of future potential dividends and engaging with other banks and financing entities for other loans. On October 21, 2026, the EIB entered into a Loan Sale Agreement, with the Buyer, pursuant to which the EIB agreed to sell to the Buyer all of the EIB’s rights, title and interest in the Loan. The Loan Sale Agreement provides for the Buyer’s acquisition of the loan at a negotiated discounted price. On November 10, 2026, the Company received formal written confirmation from the EIB, that the closing of the Loan Sale Agreement had occurred effective November 4, 2026, and that the Company had been fully released from all obligations to the EIB under the Finance Contract and guarantee agreements. The Company expects to enter into separate agreements with the Buyer regarding the settlement of the Loan following completion of the Transfer. No assurance can be given as to whether such separate agreements will be entered into, the terms or timing of any such agreements, or the accounting treatment or impact on financial statements and therefore until such agreements are finalized the Buyer may exercise remedies available under the finance agreement, including enforcement of immediate repayment of the Loan.