NOTE 9 - COMMITMENTS AND CONTINGENCIES:

The Company is obligated to repay certain research and development grants received from the Government of Israel in the form of a royalty rate on future sales of products derived from the funded research and development activities. As of December 31, 2025, the Company had received approximately $14,300.

The aggregate amount of royalties to be paid is determined based on 100% of the total grants received for qualified projects plus interest. The Company may be required to pay royalties based on previous years funding in periods after December 31, 2025, for the future sale of product that includes technology developed and funded with these research and development grants received to date.

In October 2024, the company entered into a payment plan with the Israel Innovation Authority (“IIA”) to settle the outstanding amount as of the previous year. According to the agreement, the IIA agreed to offset a delayed payment of approximately $50 from the total outstanding amount. The company committed to making an immediate payment of $190 and to spread the remaining balance over two years, with quarterly installments of approximately $106 starting from October 2024. The outstanding debt will continue to accrue interest and linkage differences in accordance with legal requirements until fully settled. Additionally, the company is required to report and pay ongoing royalties starting from the first half of 2024

During the years ended 2025 and 2024, the Company repaid amounts of $462 and $400, respectively.

As of December 31, 2025, the total royalty amount that may be payable by the company is approximately $14,300 ($15,903 including interest) and the Company repaid amounts of approximately $11,083.

As of December 31, 2025, the total royalty amount that may be payable by the company is approximately $612 and repaid approximately $11,083 in such grants.

Royalties payable: