Company: OMQS
Filing Date: 2025-08-19
Form Type: 10-Q
Source: 0001641172-25-024877
Chunk: 68

Company: OMNIQ Corp.
Filing Date: 2025-08-19
Form: 10-Q
Item: Part I, Item 8
Chunk 68
---
 financial performance.
The accounting policies of our single reportable segment are the same as those for the Company as a whole.

Note
13 – DISCONTINUED OPERATIONS

On July 11, 2025, OmniQ Corp., a Delaware corporation
(the “Company”), together with its subsidiaries, Quest Marketing, Inc., HTS Image Processing, Inc., OmniQ Vision Inc., HTS
Image Ltd., OmniQ Technologies Ltd., and Dangot Computers, Ltd. (collectively, the “Sellers”), entered into an Asset Purchase
Agreement (the “Purchase Agreement”) with Summit Junction Holdings LLC, a Delaware limited liability company (the “Buyer”).

Pursuant to the Purchase Agreement, the Sellers
agreed to sell, and Buyer agreed to purchase, substantially all of the assets and assume certain liabilities mainly associated with the
Company’s legacy business line, including its integrated hardware, software, and automation solutions business, (the “Transferred
Business”). The Transaction was consummated on July 11, 2025. Although the Purchase Agreement is dated as of June 30, 2025, the
parties executed the agreement and consummated the Transaction on July 11, 2025.

    F-10

The aggregate consideration for the Transaction
is approximately $45.0 million, consisting of the assumption by Buyer of up to $55.0 million in specified liabilities of the Transferred
Business and the issuance by the Company of a Promissory Note in the principal amount of $10.0 million in favor of the Buyer. The Promissory
Note bears interest at 5% per annum, is amortized over a ten-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.

The sale resulted in a net gain on disposal of
approximately $34.7m, which reflects the difference between the carrying amount of the net assets disposed of and the consideration transferred/assumed,
including the promissory note and transaction costs. However, due to the related-party nature of the transaction, management determined
it would be more