NOTE 7

LEASES

The Company have entered into several non-cancelable operating lease agreements for real estate (mainly offices, warehouse and base stations), vehicles and certain network equipment. In addition to rent, the leases may require payment of maintenance, insurance and other operating expenses. The Company's leases have original lease periods expiring between 2024 and 2029. Payments due under such lease contracts include primarily fixed payments. The Company does not assume renewals in the determination of the lease term unless the renewals are deemed to be reasonably assured at lease commencement (or become as such in future date). The Company's lease agreements do not contain any material residual value guarantees or material restrictive covenants.

The components of annual lease costs, lease term and discount rate are as follows:

	US dollars
	Year Ended
(in thousands)	December 31, 2023

Operating annual lease cost:
Office and warehouse space		2,129
Base stations		1,206
Vehicle		51
Others		16
		3,402
Weighted Average Remaining Lease Term (years):
Office space		5.1
Base stations		2.9
Vehicle		1.9
Others		2

Weighted Average Discount Rate (%):
Office space		6.35
Base stations		8.38
vehicle		10.49
Others		7.33

Supplemental cash flow information related to operating leases was as follows:

	US dollars
	Year Ended
(in million)	December 31, 2023

Cash paid for amounts included in the measurement of lease liabilities:		3.4
Operating cash flows from operating leases

The following is a schedule, by years, of maturities of operating lease liabilities as of December 31, 2023:

	US dollars
(in thousands)	December 31, 2023

Period:
2024		3,450
2025		2,143
2026		1,354
2027		1,174
2028		1,085
Thereafter		396
Total operating lease payments		9,602
Less: imputed interest		(1,530	)
Present value of lease liabilities		8,072