Company: GAUZ
Filing Date: 2025-03-11
Form Type: 20-F
Source: 0001213900-25-022437
Chunk: 177

Company: Gauzy Ltd.
Filing Date: 2025-03-11
Form: 20-F
Item: Item 19
Chunk 177
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 with certain credit funds for a loan                            

The Facility Agreement was amended by
a First Amendment on April 25, 2022, under which Vision acceded to the Facility Agreement as an additional borrower, and assumed25% of
the first loan ($5,000) and25% of the unutilized amount of the Facility ($2,500), against repayment of a corresponding amount owed by
it to the Company under inter-company loans. The Facility was thereafter fully utilized on April 25, 2022 by the drawdown of loans by
each of the Company and Vision (aggregated into a loan in an amount of $22,500(75%) owed by the Company, and a loan in an amount of $7,500owed by Vision (25%)) (the “ Facility Loans”).

The credit funds also received a “phantom
warrant” under the terms of the Facility Agreement, for further details see Note 16(d).

If the Group prepays the Facility Loans,
it will pay a prepayment compensation equal to either interest and fees that would have become payable, until lapse of 6 months following
the prepayment date; or interest and fees payable that were yet to be paid, for a period between 18 to 24 months following the drawn down
dates, depending on the date of prepayment.

As the Facility Loans contained embedded
features not closely related to the host contract, the Company elected to apply the fair value option to them. The Company recorded financial
expense amounting to $806for the year ended December 31, 2024.

F-29

GAUZY LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(U. S. dollars in thousands, except share and per
share amounts)

NOTE 9-NONCONVERTIBLE LOANS(continued):

  On July 3, 2023 the Group entered into a waiver and amendment agreement with respect to the Facility Agreement                             

Under the NPA, the Company and its subsidiaries
are subject to various negative and affirmative covenants, which include, among others, the following: (i) limitations on incurrence of
additional financial indebtedness and on grant of liens (subject to certain permitted incurrence of indebtedness); (ii) limitations on
investments in, and formation or acquisition of, additional entities or joint ventures; (iii) limitations on the conduct of any material
activities other than those related to the development, manufacture and marketing of vision and