GENERAL

12 Months Ended

Dec. 31, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

GENERAL

NOTE 1 - GENERAL

A. Operations

World Health Energy Holdings, Inc. (the “Company” or “WHEN”) was formed on May 21, 1986 under the laws of the State of Delaware. The Company has invested in a variety of internally developed software programs that it strove to commercialize.

UCG, INC. (the “UCG”) was incorporated on September 13, 2017, under the laws of the State of Florida. The Company wholly-owns the issued and outstanding shares of RNA Ltd. (“RNA”).

RNA is primarily a research and development company that has been performing software design work for UCG in the field of cybersecurity under the terms of development agreement between UCG and RNA. UCG is primarily engaged in the marketing and distribution of cybersecurity-related products.

In anticipation of the transaction contemplated under the SG Merger Agreement, SG 77 Inc., a Delaware corporation and a wholly-owned subsidiary of UCG (“SG”), was incorporated on April 16, 2020 and all of the cybersecurity rights and interests held by UCG, including the share ownership of RNA, were assigned to SG.

B. SG Transaction

On April 27, 2020, the Company completed a reverse triangular merger pursuant to the Agreement and Plan of Merger (“SG Merger Agreement”) among the Company, R2GA, Inc., a Delaware corporation and a wholly owned subsidiary of the Company (“Sub”), UCG, SG, and RNA. Under the terms of the SG Merger Agreement, R2GA merged with SG, with SG as the surviving corporation and a wholly-owned subsidiary of the Company (“SG Merger”). The SG Merger was effective as of April 27, 2020, whereby SG became a direct and wholly owned subsidiary of the Company and RNA became an indirect wholly owned subsidiary of the Company.

As consideration for the SG Merger, the Company issued 3,870,000 Series B convertible preferred stock, par value $0.0007 per share, to UCG. Each share of the Series B convertible preferred stock will automatically convert into 100,000 shares of common stock, par value $0.0007, for an aggregate amount of 387,000,000,000 shares of common stock, upon the filing with the Secretary of State of Delaware of an amendment to the Company’s certificate of incorporation increasing the number of authorized shares of common stock that the Company is authorized to issue from time to time.

On October 7, 2021, and following the approval by the stockholders, the Company increase its authorized shares to 750,000,000,000 (from 110,000,000,000 shares) and changed the par value of the common stock to $0.00001 (from $0.0007) (see Note 10).

Following the effectiveness of the Amendment referred to above, on December 3, 2021, the Company issued 387,000,000,000 shares of common stock to UCG upon the automatic conversion of all 3,870,000 outstanding Series B convertible preferred stock issued in April 2020 in connection with the acquisition of RNA from UCG.

The SG Merger was accounted for as a reverse asset acquisition. Under this method of accounting, SG was deemed to be the accounting acquirer for financial reporting purposes. This determination was primarily based on the facts that, immediately following the SG Merger: (i) SG’s stockholders owned a substantial majority of the voting rights in the combined company, (ii) SG designated a majority of the members of the initial board of directors of the combined company, and (iii) SG’s senior management holds all key positions in the senior management of the combined company. As a result of the reverse asset acquisition transaction, the shareholders of SG received the largest ownership interest in the Company, and SG was determined to be the “accounting acquirer” in the reverse asset acquisition transaction.

As a result, the historical financial statements of the Company were replaced with the historical financial statements of SG. The number of shares prior to the reverse capitalization have been retroactively adjusted based on the equivalent number of shares received by the accounting acquirer in the Recapitalization Transaction.

WORLD HEALTH ENERGY HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 – GENERAL (continue)

C. CrossMobile Transaction

On March 22, 2022, the Company, CrossMobile Sp. z o.o, a company formed under the laws of Poland (“CrossMobile”) and the shareholders of CrossMobile (of which Mr. Giora Rosenzweig, held 40.67% and Mr. George Baumeohl held 3.33% of the issued preferred share capital of CrossMobile) entered into an Investment Agreement (“CrossMobile Agreement”) pursuant to which the Company is to purchase 26% of the outstanding common shares of CrossMobile on a fully diluted basis, in consideration of the issuance by the Company to CrossMobile of 10,000,000,000 restricted shares of the Company’s common stock (the “Initial Investment”).

On July 13, 2022, the Company issued 10,000,000,000 common shares with fair value of $4 million to Crossmobile to consummate the transaction.

CrossMobile is a licensed mobile virtual network operator in Poland, providing the necessary licenses and key infrastructure in the EU. With its involvement in CrossMobile, the Company expects to provide advanced cybersecurity solutions and other next-generation value-added services to CrossMobile’s future product offerings.

In addition, under the CrossMobile Agreement, the Company had the option, through January 22, 2024, to purchase additional shares of CrossMobile (“Additional Share Purchase Option”) such that following the additional purchase, the Company shall hold approximately 51% of CrossMobile’s outstanding common shares on a fully diluted basis. In the event the Company shall choose to exercise the option, the Company shall issue such number of restricted shares of common stock of the Company calculated based on pre-money valuation of CrossMobile as determined by an independent appraiser agreed between the Company and CrossMobile.

On October 25, 2022, the Company exercised the Additional Share Purchase Option and acquired the additional 25% shares of CrossMobile such that following the acquisition, the Company increased its holding from 26% to 51% of CrossMobile’s outstanding common stock on a fully diluted basis. In consideration for the exercise of the Additional Share Purchase Option, the Company issued 10,000,000 restricted common stock on November 28, 2022 to Crossmobile. See note 8 below for further information. See note 8 below for further information.

The Company, collectively with SG, RNA and CrossMobile are hereunder referred to as the “Group”.

D. Board and Shareholder Authority for Reverse Stock Split

On May 17, 2023, Company’s stockholders approved an amendment to the Company’s Certificate of Incorporation (“Reverse Stock Split Certificate of Amendment”) in order to effect a reverse stock split of the Company’s common stock pursuant to a range of between 20,000-to-1 and 60,000-to-1 (the “Reverse Stock Split”), when and as determined by the Company’s Board of Directors. Pursuant to the Reverse Stock Split, each one thousand or fifteen thousand shares of common stock, or any other figure within that range, as shall be determined by the Board of Directors at a later time, will be automatically converted, without any further action by the stockholders, into one share of common stock. The Reverse Stock Split Certificate of Amendment will be effective upon receipt of approval from the Financial Industry Regulatory Authority (“FINRA”) for the Reverse Stock Split and the filing with the Secretary of the State of Delaware.

WORLD HEALTH ENERGY HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 – GENERAL (continue)

E. Liquidity

The Group is subject to certain inherent risks and uncertainties associated with the development of its business. To date, substantially all the Company’s efforts and investments have been devoted to the growth of its business, organically and inorganically. These investments have historically been funded by raising outside capital, and as a result of these efforts, the Company has generally incurred significant losses and used net cash outflows from operations since inception and it may continue to incur such losses and use net cash outflows for the foreseeable future until such time it reaches scale of profitability without needing to rely on funding from outside capital to sustain its operations.

During the year ended December 31, 2023, the Company incurred a net loss of $7,050 thousands and used net cash flows in its operations of $1,074 thousands. As of December 31, 2023, the Company had unrestricted cash and cash equivalents of $46 thousands available to fund its operations, and an accumulated deficit of $23,015 thousands.

In response to the risks and uncertainties described above, the Group and George Baumeohl, a Company director, have entered into an investment agreement signed on November 1, 2022, where the director has committed to invest up to $3,000,000 through August 2025, as needed by the Company through the purchase of shares of the Company’s common stock. As of December 31, 2023 an amount of $1,225,000 out of the $3,000,000 was invested in the Company. In addition, certain shareholders including Mr. Baumeohl, have agreed to provide additional financial support to the Company in the event that the remaining funds provided under the November 1, 2022 investment agreement are not sufficient to support operations. See also note 10. the Company continues to carefully evaluate its liquidity position and while it is difficult to predict its future liquidity requirements with certainty, the Company currently expects it will be able to generate sufficient liquidity to fund its operations over the next twelve months beyond the issuance date.

F. Risk factors

The Group face a number of risks, including uncertainties regarding finalization of the development process, demand and market acceptance of the Group’s products, the effects of technological changes, competition and the development of products by competitors. Additionally, other risk factors also exist, such as the ability to manage growth and the effect of planned expansion of operations on the Group’s future results. In addition, the Group expects to continue incurring significant operating costs and losses in connection with the development of its products and increased marketing efforts. As mentioned above, the Group has not yet generated significant revenues from its operations to fund its activities, and therefore the continuance of its activities as a going concern depends on the receipt of additional funding from its current stockholders and investors or from third parties.

G. In October 2023, Hamas terrorists infiltrated Israel’s southern border from the Gaza Strip and conducted a series of attacks on civilian and military targets. Hamas also launched extensive rocket attacks on Israeli population and industrial centers located along Israel’s border with the Gaza Strip and in other areas within the State of Israel. These attacks resulted in extensive deaths, injuries and kidnapping of civilians and soldiers. Following the attack, Israel’s security cabinet declared war against Hamas and a military campaign against these terrorist organizations commenced in parallel to their continued rocket and terror attacks. Following the attack by Hamas on Israel’s southern border, Hezbollah in Lebanon also launched missile, rocket, drone and shooting attacks against Israeli military sites, troops and Israeli towns in northern Israel. In response to these attacked, the Israeli army has carried out a number of targeted strikes on sites belonging to Hezbollah in southern Lebanon. It is possible that the hostilities with Hezbollah will escalate, and that other terrorist organizations, including Palestinian military organizations in the West Bank, as well as other hostile countries, such as Iran, will join the hostilities. Such hostilities may include terror and missile attacks.

Certain of our consultants in Israel may be called up for reserve duty, in addition to employees of our service providers located in Israel, have been called, for service and such persons may be absent for an extended period of time. In the event that hostilities disrupt our ongoing operations, our ability to deliver or provide services in a timely manner to meet our contractual obligations towards customers and vendors could be materially and adversely affected.

WORLD HEALTH ENERGY HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 – GENERAL (continue)

The intensity and duration of Israel’s current war against Hamas is difficult to predict, as are such war’s economic implications on the Company’s business and operations and on Israel’s economy in general. These events may be intertwined with wider macroeconomic indications of a deterioration of Israel’s economic standing, which may have a material adverse effect on the Company and its ability to effectively conduct its operations.

Since this is an event that is not under the control of the Company, and matters such as the fighting continuing or stopping may affect the Company’s assessments, as at the reporting date the Company is unable to assess the extent of the effect of the war on its business activities and on the business activities of its subsidiaries, and on their medium and long term results. The Company is continuing to regularly follow developments on the matter and is examining the effects on its operations and the value of its assets.