NOTE 7 – SOLAR PHOTOVOLAIC JOINT VENTURE PROJECT

In June 2025, the Company and the other lenders entered into an addendum to the original Loan and Partnership Agreement to provide an additional bridge loan of €25 thousands (approximately $27) to the Partnership, of which the Company contributed €19 thousands (approximately $20). The proceeds are intended to fund a feasibility study for a battery energy storage project near the PV Project in Germany. The additional loan bears interest at 7% annually and is subject to the same maturity and repayment terms as the original loan. All other provisions of the original agreement remain unchanged.

On September 8, 2025, the Partnership entered into Addendum No. 2 to the Loan and Partnership Agreement (“Addendum No. 2”), pursuant to which the Lenders agreed to provide additional funding in the aggregate principal amount of €600 thousands (the “Principal Addendum Amount”), of which the Company committed €450 thousands (approximately $528). The Principal Addendum Amount bears interest at a rate of 7% per annum and will mature in accordance with the terms of the Loan under the Loan and Partnership Agreement. Proceeds from Addendum No. 2 are intended to be used to support development of a battery energy storage system and photovoltaic facility aimed at achieving Ready-to-Build status.

On December 24, 2025, the Partnership, Solterra, and other lenders (“New Lenders”), entered into additional Loan Agreement (“Loan No. 2”), pursuant to which the New Lenders agreed to provide additional funding in the aggregate principal amount of €280 thousands (the “Principal Loan Amount”), of which the Company committed €210 thousands (approximately $219). The Principal Loan Amount bears interest at a rate of 7% per annum and has a contractual maturity of 24 months. The loan is intended to be repaid in full until the project reaching ready-to-build (“RTB”) stage.

In addition, the New Lenders are entitled to receive 85% of the reduced development fee payable to the developer upon achievement of the RTB milestone, with the remaining 15% payable to Solterra.

As of December 31, 2025, the Company has funded €1,455 thousands (approximately $1,708).

The Company’s interest in the Partnership was evaluated under ASC 810-10, and the Company determined that the Partnership is not subject to consolidation by the Company. Accordingly, the Partnership is not consolidated in the Company’s consolidated financial statements.

The Company elected to account for the Loan and Partnership Agreement under the fair value option in accordance with ASC 825. The Company estimated the fair value of the Loan and Partnership Agreement using a third-party appraiser and various assumptions such as, probability of completion of the project based on key milestones, scenarios for the expected project’s cash realization value (including expected power of the project, selling price per megawatt, and loan repayment dates). The projected net cash flows were discounted using an interest rate appropriate for similar projects. The result was adjusted to the probability for the completion of the project as of the valuation date. The interest rate was determined at 8.30% and 9.18% as of December 31, 2025 and 2024, respectively. The Company calculated the Loan Agreement and the fair value of the Company’s interest in the Partnership and Loan amounted to €2,164 thousands (approximately $2,542) and €780 thousands (approximately $808) as of December 31, 2025 and 2024, respectively.

NEXENTIS TECHNOLOGIES INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(USD in thousands, except share and per share data)

NOTE 7 – SOLAR PHOTOVOLAIC JOINT VENTURE PROJECT (continued)

In the event the project is sold to a third party not related to the Borrower during a 30 months term, the Company will be entitled to repayment of the principal plus a pro-rata share (15%) of 50% of the net profit from the sale, as defined in the agreement.

If the project is not sold by the end of the term of the loan, the loan will bear annual interest of 7%, and the total amount due (principal and interest) will be repaid at maturity. The agreement does not provide for early repayment.

The Company assessed its involvement in the Pikozow Project in accordance with ASC 810-10, Variable Interest Entities (VIE), and concluded that the Borrower does not meet the definition of a VIE. Accordingly, no consolidation is required.

The Company elected to account for the loan agreement under the fair value option in accordance with ASC 825. The Company estimated the fair value of the loan using a third-party appraiser and various assumptions such as probability of the event the project would be sold to a third party as well as the probability that it would not be sold. The valuation incorporated two probability weighted scenarios, each discounted using a different interest rate reflecting the risk profile of the scenario. The interest rates applied were 18.27% and 17.97% as of December 31, 2025. Based on this analysis the fair value of the loan agreement was estimated at €172 thousands (approximately $202) as of December 31, 2025.