Company: OMQS
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001493152-25-023481
Chunk: 5

Company: OMNIQ Corp.
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 8
Chunk 5
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unim totaling 1.5M NIS, approximately US $393 thousand.
The note accrues interest at the Israeli Prime Rate plus 3.5% which currently equals 9.5% per annum and is payable in 36 monthly installments.
The balance at December 31, 2024 is $251 thousand and at September 30, 2025 was $200 thousand.

As
of September 30, 2025, the Company was not in compliance with certain financial covenants related to the Bank Leumi and Bank Hapoalim
debt. The Company’s failure to comply with these financial covenants could result in an event of default under its debt agreements.
Therefore, we reclassified the total balance as current debt on the balance sheet. The Company is actively pursuing options to address
its noncompliance. The lenders have not requested early repayment of the loan as of the date when these financial statements were available
to be issued.

As
part of the sale of the Quest division and it’s assets, and as discussed in Note 11, the Company entered into a Promissory Note
which bears interest at 5% per annum, is amortized over a 10ten-year period, and provides for a balloon payment after the third year.
In addition, the Company is entitled to a contingent payment of up to $10.0 million in the event that, within 18 months following
the closing, Buyer either (i) consummates a sale of all or substantially all of its assets or equity for consideration in excess of $100.0 million
or (ii) completes an initial public offering at a valuation exceeding $100.0 million. Due to the related party nature of the CEO of omniQ relationship with the Note Holder, this note is deemed related
party. In addition to this, the Company entered into a Transition Services Agreement whereby the employees doing work for
the Company would charge back at a portion of the actual payroll cost, for the time working on the Company. This has been recorded as
a short-term related party payable as of September 30, 2025.

    F-8

NOTE
8 – OTHER INCOME

For
the nine months ended September 30, 2024, the Company received government relief funds in the amount of approximately NIS 1.8 million
or US $482 thousand.

NOTE
9 – STOCKHOLDERS’ EQUITY

PREFERRED
STOCK

Series