They Keep borrowing money to maintain the $2 Million CEO, CFO and his father pay themselves annually.
During the year ended December 31, 2022, the Company entered into five short term loans totalling NIS 26.8 million, approximately $7.6 million. The note accrues average interest at 6.3% per annum.
As of March 31, 2023, 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.
NOTE 2 – LIQUIDITY AND CAPITAL RESOURCES
The accompanying consolidated financial statements have been prepared assuming that we will continue as a going concern. The following are the principal conditions or events which potentially raise substantial doubt about the company’s ability to continue as a going concern:
? Balancing the need for operational cash with the need to add additional products
? Timely and cost-effective development of products
? Working capital deficit of $39.6 million as of March 31, 2023
? Accumulated deficit of $88 million as of March 31, 2023
? Multiple periods of losses from operations
? Noncompliance with certain debt covenants
