NKLR 10-K & 10-Q changes, risk factors and insider trading

The following discussion and analysis provides information that Terra Innovatum Global N.V. (the “Company” or “Terra”) management believes is relevant to an assessment and understanding of Terrathe Innovatum Global N.V.’sCompany’s results of operations and financial condition. This discussion should be read together with Terra Innovatumthe Global N.V.’sCompany’s unaudited interim condensed consolidated financial statements as of and for the three and six months ended March 31,June 30, 2026 and 2025, and the related notes included elsewhere in this Form 10-Q. All amounts in thousands except share and per share amounts.

This discussion may contain forward-looking statements based upon current expectations that involve risks and uncertainties. TerraThe Innovatum Global N.V.’sCompany’s actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth under “Risk Factors” or in other parts of this Form 10-Q.

We are a pioneering nuclear energy technology company developing the SOLOTM Micro-Modular Nuclear Reactor (“SOLO”), a breakthrough solution designed to address critical challenges in affordable, clean, decentralized energy production. Our reactor represents a significant technological and engineering advancement, offering a compact, safe, and economically compelling alternative to traditional energy generation and supply solutions. The SOLO reactor’s core innovation lies in its ability to generate 1 MWe of electricity baseload with a continuous operational cycle of up to 15 years, extendable to 45 years through refueling, with a fixed and competitive projected levelized cost of energy. Our strategic roadmap targets commercial deployment by 2028, with a clear focus on delivering a scalable, modular nuclear solution that can be deployed across diverse geographies and markets — from industrial and infrastructure to remote and off-grid applications. Key differentiators include a gas-cooled design, multiple safety shutdown mechanisms, safeguard-by-design, small footprint, and the ability to use commercially available Low Enriched Uranium (“LEU”), which significantly reduces regulatory and technological barriers typical in nuclear energy development. We have made substantial progress in de-risking our First-of-a-Kind (“FOAK”) reactor, including initiating regulatory engagement with the U.S. Nuclear Regulatory Commission (“NRC”), and establishing a robust supply chain strategy. We have completed the reactor design sufficiently to support component fabrication and NRC licensing, validated key technological components, and are targeting licensing and deployment of the FOAK reactor by 2028.

On January 2, 2026, we entered into a lease for office space in Lucca, Italy, with a noncancelable term commencing April 1, 2026 and expiring March 31, 2032. The lease provides for annual base rent of approximately $88 (€75), subjectwhich tois escalation.adjusted annually in accordance with the variation in the Italian consumer price index (“ISTAT”), as required under Italian commercial lease law. These index-based rent adjustments are variable lease payments and are recognized as expense in the period incurred; they are not included in the measurement of our lease liability or right-of-use asset.

For the three months ended March 31,June 30, 2026 and 2025, we reported a net loss of $7,106$18,044 and $1,448,$1,145, respectively. Net cash used in operating activities was $3,856 for the three months ended March 31, 2026 compared to net cash used of $199 for the three months ended March 31, 2025.

Product Development Plan. The commercial rollout of advanced nuclear reactors depends on securing regulatory approvals for its design, construction, and operation. Our regulatory engagement plan was submitted to the NRC, and the NRC is currently reviewing a number of safety related topics related to SOLO. Although our team has significant prior experience working with the NRC, we cannot control NRC’s review process and review periods may take longer than anticipated.

Funding and Investment. We have limited financial resources. There can be no assurance that sufficient funding will be available to us to fund our operating expenses and to further develop our business. We anticipate that we will likely need to raise additional capital to fund our operations while we implement and execute our business plan. Our continued solvency is dependent upon our ability to obtain additional working capital to complete our reactor development, to successfully market our reactors and to achieve commerciality for our reactors. We have encountered and expect to continue to encounter risks and uncertainties frequently experienced by companies in rapidly evolving industries. Accordingly, we may be unable to prepare accurate internal financial forecasts or replace anticipated revenue that we do not receive as a result of delays, changed circumstances, or changed market conditions arising from these factors, and our results of operations in future reporting periods may be below the expectations of investors or analysts.

Macroeconomic Conditions and Global Market Dynamics. Our business operates in a complex global environment with multiple interconnected economic factors that can significantly impact our technological development, regulatory trajectory, and potential market penetration. As a nuclear technology company with an international human capital strategy and multinational supply chain, we are sensitive to macroeconomic trends and risks.

Global Supply Chain Dynamics. We utilize a strategic outsourced manufacturing approach for the SOLO project, leveraging international human resources and implementing an international manufacturing model for our FOAK reactor. This strategy exposes us to global supply chain vulnerabilities, including potential impacts from geopolitical tensions, trade agreements, tariffs, and manufacturing disruptions. Our current assembly preparation in Europe for reactor deployment in the U.S. introduces additional complexity in navigating international trade regulations, currency exchange risks, and logistical challenges.

Inflation and Cost Pressures. Inflationary trends represent a risk to our development trajectory. Escalating costs in specialized manufacturing, regulatory compliance, technical talent acquisition, and raw material procurement could potentially erode our projected economic advantages.

Energy Market Evolution. The global energy transition, driven by decarbonization efforts and increasing demand for reliable low-carbon baseload power, creates both opportunities and challenges. The explosive growth in data center energy requirements, particularly with artificial intelligence (“AI”) and computational infrastructure expansion, presents a promising market segment. However, economic growth cycles, shifts in energy policy, and potential slowdowns in technological adoption could materially affect our market positioning and revenue projections.

Regulatory and Geopolitical Landscape. Our multinational operational model requires navigating complex regulatory environments across different jurisdictions. Changes in nuclear energy policies and geopolitical tensions could significantly impact our potential market access. The evolving global stance on nuclear energy, particularly small modular reactors, introduces both strategic opportunities and potential regulatory constraints.

Technological and Labor Market Dynamics. The specialized nature of our technology demands access to a global pool of highly skilled technical talent. Potential labor market shifts, competition for specialized nuclear engineering expertise, and varying international education and training standards could influence our human resource strategy and technology development velocity.

Economic Uncertainty Factors. Macroeconomic uncertainties, including potential recessionary periods, fluctuations in investment trends in energy related technology, and broader economic growth patterns, could affect our funding capabilities, customer acquisition strategies, and overall business development trajectory.

Our general and administrative expenses consist primarily of advisory fees, legal fees, audit, accounting, professional services fees, insurance, Board of Director compensation, developmentsoftware costs, transportation, food and lodging, conference and seminar registration fees, advertising, rental, filing fees, employee benefits, consultancy fees, representation expenses, commissions, and other miscellaneous expenses.

Other income,income net(expenses)

Our other income,income net(expenses) primarily consists of foreign currency transaction gains and losses, as well as interest income.

The changeChange in fairFair valueValue —– share settledShare-Settled contingentContingent liability consists of the change in fair value of certain issuances of Convertible Preferred Shares.Liability

The change in fair value — warrant liabilities consists of the change in fair value of certain PIPE and Bridge Loan warrants.

The Three Months Ended MarchJune 31,30, 2026 Compared to the Three Months Ended MarchJune 31,30, 2025

General and administrative expenses increased by $3,980$2,494 for the three months ended MarchJune 31,30, 2026 compared to the same period in 2025 primarily due to increases of (i) $2,359$1,707 for compensationconsulting/advisory fees paid to thirdnon-employee parties,service providers, (ii) $644$652 for insurance, (iii) $458$436 for Board of Director compensation, (iv) $144 for development costs, (v) $125$85 for transportation, (vi) $69 for food and lodging, (vii) $51 for conference and seminar registration fees, (viii) $33 for advertising, (ix) $31 for professional fees, (xv) $23 for rental, (vi) $22 for office rent, and (xivii) $21 for filing fees. These increases were offset by decreases of (i) $323 for professional fees, (ii) $89 for software expenses, (iii) $20 in contractor costs, (iv) $20 in certificates and procedures, and (v) $17 in consultancy. The remaining $22$17 net change increase is primarily driven by employeefood benefits,and consultancylodging, computer equipment depreciation, conference and seminary registration fees, representationbook expenses, commissions,subscriptions, and other miscellaneous expenses.

Development costs increased by $1,205$1,425 for the three months ended MarchJune 31,30, 2026 compared to the same period in 2025 primarily due to increases of (i) $1,059$1,033 in technical consultancy fees, (ii) $68 in salaries and wages, (iii) $53$179 in other payroll and benefits, (iii) $157 in salaries and wages, and (iv) $24$79 in employee income tax withholding. The remaining $1$23 increasenet decrease is primarily driven by transportation and travel costs.

Other Income (ExpenseExpenses)

Other income,income net(expenses)

Other income, netincome was $2,780 $1,190 for the three months ended MarchJune 31,30, 2026, which primarily consists of $2,168$646 of net foreign currency gains and $612$544 of interest income. Other income, net was $1 for the three months ended March 31, 2025.

There was a $3,335$12,492 unrealized loss in fair value attributable to the change in fair value of the share settled contingent liability for the three months ended MarchJune 31,30, 2026. There was no share settled contingent liability during the same period in 2025.

The $83$663 unrealized gainloss in fair value attributable to warrant liabilities for the three months ended MarchJune 31,30, 2026 consists of the change in fair value of certain PIPE and Bridge Loan warrants. There was no$1,260 unrealized gain in fair value attributable to certain Bridge Loan warrant liabilityliabilities during the same period in 2025.

The provision for income taxes was $0 for the three months ended MarchJune 31,30, 2026 and 2025.

Net loss for the three months ended MarchJune 31,30, 2026 was $7,106$18,044 compared to $1,448$1,145 for the three months ended MarchJune 31,30, 2025. The $5,658$16,899 net change was primarily due to the $5,185 increase in operating expenses and $3,335$12,492 change in fair value of the shareshared settled contingent liability.liability, $3,919 increase in operating expenses and $1,923 change in fair value of warrant liabilities. These increases were partially offset by increases of $2,779$1,435 in other income,income net(expenses), and $83 in fair value of warrant liabilities.net.

As of MarchJune 31,30, 2026, we had cash of $96,701$91,055 and an accumulated deficit of approximately $614,382.$632,426. Net cash used in operating activities was $3,856$8,778 for the three six months ended MarchJune 31,30, 2026. We have historically incurred recurring operating losses and generated negative cash flows from operations.operations as we are a pre-revenue company developing technology and looking towards commercialization in 2028.

The following table provides detailed information about our net cash flows for the threesix months ended MarchJune 31,30, 2026 and 2025:

Net cash used by operating activities for the threesix months ended MarchJune 31,30, 2026 was $3,856.$8,778. This amount was primarily driven by (i) net loss of $7,106,$25,150, (ii) non-cash adjustments of $3,038,$15,549, (iii) net working capital decreases of $195,$798, and (iv) an increase in other non-current liabilities of $17.$25.

Net cash used by operating activities for the threesix months ended MarchJune 31,30, 2025 was $199.$1,371. This amount was primarily attributable to (i) net loss of $1,448, $2,593, (ii) non-cash adjustments of $46, and$1,079, (iii) net working capital decreases of $1,203.$2,298, and (iv) an increase in other non-current liabilities of $3.

Net cash used by investing activities for the three six months ended MarchJune 31,30, 2026 was $328,$378, which was related to the purchases of equipment. There was no net cash from investing activities during the threesix months ended MarchJune 31,30, 2025.

There was no net cash from financing activities during the threesix months ended MarchJune 31,30, 2026. Net cash provided by financing activities for the threesix months ended March 31,June 30, 2025 consisted of proceeds of $172$4,984. This amount primarily consists of (i) $4,803 of proceeds from anbridge interest-freeloans, loan(ii) agreement$190 thatof weproceeds enteredfrom intorelated party loans, (iii) $20 of payments of debt issuance costs associated with ourthe shareholdersbridge onloans, December 18,and 2024.(iv) $11 of capital contributions.