# EDGAR Filing Document

**Accession Number:** 0001787518
**File Stem:** 0001213900-25-126417
**Filing Date:** 2025-12
**Character Count:** 138314
**Document Hash:** 28121498cf38142bdb0eda11398c8d59
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001213900-25-126417.hdr.sgml**: 20251230

**ACCESSION NUMBER**: 0001213900-25-126417

**CONFORMED SUBMISSION TYPE**: 8-K

**PUBLIC DOCUMENT COUNT**: 24

**CONFORMED PERIOD OF REPORT**: 20251230

**ITEM INFORMATION**: Entry into a Material Definitive Agreement

**ITEM INFORMATION**: Completion of Acquisition or Disposition of Assets

**ITEM INFORMATION**: Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant

**ITEM INFORMATION**: Unregistered Sales of Equity Securities

**ITEM INFORMATION**: Other Events

**ITEM INFORMATION**: Financial Statements and Exhibits

**FILED AS OF DATE**: 20251230

**DATE AS OF CHANGE**: 20251230

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Nukkleus Inc.
- **CENTRAL INDEX KEY:** 0001787518
- **STANDARD INDUSTRIAL CLASSIFICATION:** SERVICES-MANAGEMENT CONSULTING SERVICES [8742]
- **ORGANIZATION NAME:** 07 Trade & Services
- **EIN:** 383912845
- **STATE OF INCORPORATION:** DE
- **FISCAL YEAR END:** 0930

**FILING VALUES:**
- **FORM TYPE:** 8-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-39341
- **FILM NUMBER:** 251612046

**BUSINESS ADDRESS:**
- **STREET 1:** 575 FIFTH AVENUE, 14TH FLOOR
- **CITY:** NEW YORK
- **STATE:** NY
- **ZIP:** 10017
- **BUSINESS PHONE:** 212-791-4663

**MAIL ADDRESS:**
- **STREET 1:** 575 FIFTH AVENUE, 14TH FLOOR
- **CITY:** NEW YORK
- **STATE:** NY
- **ZIP:** 10017

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** Brilliant Acquisition Corp
- **DATE OF NAME CHANGE:** 20190909

?xml version='1.0' encoding='ASCII'?

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

**FORM 8-K**

**CURRENT REPORT**

Pursuant to Section 13 or Section 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): **December 30, 2025**

**NUKKLEUS INC.**

*(Exact name of registrant as specified in its charter)*

---

| | | |
|:---|:---|:---|
| **Delaware** | **001-39341** | **38-3912845** |
| (State or other jurisdiction <br> of incorporation) | (Commission File Number) | (IRS Employer<br> Identification No.) |

---

**575 Fifth Avenue** **, 14th Floor**

**New York** **, New York 10017**

*(Address of principal executive offices) (Zip Code)*

**(212** **) 791-4663**

*(Registrant's telephone number, including area code)*

**Not Applicable**

*(Former name or former address, if changed since last report)*

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

---

| | | |
|:---|:---|:---|
| **Title of each class** | **Trading Symbol(s)** | **Name of each exchange on which registered** |
| Common Stock, par value $0.0001 per share | NUKK | The Nasdaq Capital Market |
| Warrants to purchase Common Stock | NUKKW | The Nasdaq Capital Market |

---

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

**Item 1.01** **Entry into a Material Definitive Agreement.**

As previously reported on a Current Report on Form 8-K filed with the Securities and Exchange Commission on September 2, 2025, Nukkleus Inc., a Delaware corporation (the "Company"), entered into a Stock Purchase Agreement (the "Original Agreement") with its wholly owned Israeli subsidiary, Nukk Picolo Ltd. ("Nukk Picolo"), Tiltan Software Engineering Ltd., an Israeli corporation ("Tiltan"), and Arie Shafir (the "Seller"), pursuant to which, upon satisfaction of certain closing conditions, the Company would acquire all of the issued and outstanding shares of Tiltan from the Seller. Other than the Purchase Agreement, there is no material relationship between the Company or its affiliates and Tiltan or the Seller.

On December 30, 2025, the Company, Nukk Picolo, Tiltan and the Seller entered into an Amendment to the Stock Purchase Agreement (the "Amendment", and together with the Original Agreement, the "Purchase Agreement") confirming that the consummation of the acquisition is on said date. The terms of the Amendment also provided that (i) the initial cash payment to be paid on December 31, 2025 shall be paid in U.S. Dollars based on the exchange rate published by the Bank of Israel on December 31<sup>st</sup> and (ii) the Seller would be subject to non-competition and non-solicitation covenants beginning at closing and ending June 2027. The Amendment also provides that the pre-closing dividend in the amount of NIS 3,236,088 for the year ended December 31, 2025, payable by Tiltan to the Seller pursuant to the terms of the Original Agreement, shall be paid by the Company during the 2026 calendar year from payments made from select customers,

Except as specifically amended by the Amendment, all of the other terms of the Original Agreement remained in full force and effect.

The information set forth under Item 2.01 of this Current Report on Form 8-K is incorporated herein by reference.

**Item 2.01** **Completion of Acquisition or Disposition of Assets.**

Reference is made to the disclosure set forth under Item 1.01 above, which is incorporated herein by reference.

On December 30, 2025, the Company and Nukk Picolo consummated the acquisition of all the issued and outstanding stock of Tiltan in consideration of NIS 47,600,000 (approximately $14,000,000). The purchase price is payable in a combination of (i) cash equal to 75% of the purchase price (the "Cash Portion"), or NIS 35,700,000 (approximately $10,500,000), a portion of which (NIS 5,283,333, less NIS 666,667 retained by the Company as working capital for Tiltan) will be paid by the Company to the Seller and the remainder of which is evidenced by the Note (as defined herein) delivered at closing, and (ii) shares of the Company's common stock, par value $0.0001 per share ("Common Stock"), equal to 25% of the purchase price (the "Stock Portion"), or NIS 11,900,000 (approximately $3,500,000).

As a result of the acquisition, Tiltan became an indirect wholly owned subsidiary of the Company.

 

 

*Cash Portion*

The remaining Cash Portion of NIS 29,750,000 (approximately $8,750,000) is payable by the Company in five installments at 36-day intervals until the final payment on June 29, 2026, with the first two installments each being reduced by NIS 666,667 for working capital to be retained by Tiltan. The cash payments are evidenced by the Note and secured by the pledge described below.

*Stock Portion*

At closing, the Company deposited into escrow with Adv. Lior Hinkus, as escrow agent, 2,000,000 shares of Common Stock. The Original Agreement provided for the escrow of shares of Common Stock having an aggregate value equal to 50% of the total purchase price (NIS 23,800,000), calculated based on the market price of the Common Stock on December 30, 2025 (the "Escrowed Shares").

On June 29, 2026, the escrow agent shall release to the Seller shares of Common Stock having an aggregate value equal to 25% of the purchase price (NIS 11,900,000), calculated based on the market price of the Common Stock on said date. Any Escrowed Shares in excess of this amount shall be cancelled and returned to the Company.

If the value of the Escrowed Shares on said date is less than 25% of the purchase price, the Company is required to either (i) issue additional shares of Common Stock to the Seller or (ii) pay the Seller the difference in cash, so that the Seller receives shares and/or cash having an aggregate value equal to 25% of the purchase price.

*Secured Promissory Note*

In connection with the acquisition, the Company issued a secured promissory note (the "Note") to the Seller in the principal amount of NIS 29,750,000 (approximately $8,750,000), representing the deferred Cash Portion. The Note matures in five equal installments (other than the first two installments which have been reduced by NIS 666,667 for working capital to be retained by Tiltan) at 36-day intervals beginning on the 36<sup>th</sup> day following the closing date until the final payment which is due on June 29, 2026. The Note does not bear interest unless an Event of Default (as defined in the Note) occurs, in which case the outstanding principal amount shall bear interest at the rate of 10% per annum from the date of default until payment. Events of Default include failure to timely make a monthly installment payment within ten (10) business days after written notice is received from the Seller, bankruptcy of the Company or Nukk Picolo, material breach of the Purchase Agreement, and cessation of business operations for a continuous period of twenty (20) days. Upon an Event of Default, the Seller may declare all amounts due and payable and exercise remedies under the Note and the Pledge Agreement.

 

*Pledge Agreement*

As security for the Company's payment obligations under the Note and the Purchase Agreement, Nukk Picolo entered into a pledge agreement (the "Pledge Agreement") with the Seller, pursuant to which Nukk Picolo granted the Seller a first-priority security interest in all 100 shares of Tiltan acquired in the acquisition (the "Pledged Shares"). The security interest shall be registered with the Israeli Registrar of Companies. Upon full payment of all amounts due under the Note and the Purchase Agreement, the pledge shall be released.

The foregoing descriptions of the Amendment, the Note, the Pledge Agreement and the Escrow Agreement are not complete and are qualified in their entirety by reference to the full text of such agreements, copies of which are attached as Exhibits 10.1, 4.1, 10.2 and 10.3, respectively, to this Current Report on Form 8-K and are incorporated herein by reference. The Original Agreement was filed as Exhibit 10.1 to the Company's Current Report on Form 8-K filed with the SEC on September 2, 2025 and is incorporated herein by reference.

**Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.**

The information set forth under Items 1.01 and 2.01 above, including the descriptions of the Note and the Pledge Agreement, is incorporated herein by reference.

**Item 3.02 &nbsp;&nbsp;&nbsp;&nbsp;Unregistered Sale of Equity Securities.**

Reference is made to the disclosure set forth under Items 1.01 and 2.01 above, which disclosure is incorporated herein by reference.

At closing, the Company issued 2,000,000 shares of Common Stock to the escrow agent (the "Escrowed Shares").

The issuance of the Escrowed Shares was exempt from registration under Section 4(a)(2) of the Securities Act of 1933, as amended (the "Securities Act"), as transactions by an issuer not involving any public offering. The Seller represented that he is a sophisticated investor and had access to information concerning the Company. The securities were issued without general solicitation or advertising. The securities are restricted securities for purposes of the Securities Act and the certificates representing such shares bear restrictive legends to that effect.

**Item 8.01 Other Events.**

On December 30, 2025, the Company issued a press release announcing the closing of the Acquisition. A copy of the press release is attached as Exhibit 99.3 to this Current Report on Form 8-K and is incorporated herein by reference.

***Forward-Looking Statements***

This Current Report on Form 8-K contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include, but are not limited to, statements regarding the Company's expectations, intentions, and strategies regarding the future, including the anticipated benefits of the acquisition and the timing of future payments. These statements are based on current expectations and assumptions that are subject to risks and uncertainties. Actual results could differ materially from those anticipated because of various factors, including those described in the Company's filings with the Securities and Exchange Commission, including its Registration Statements on Form S-1 filed with the SEC. The Company undertakes no obligation to update any forward-looking statement to reflect events or circumstances arising after the date on which it was made.

**Item 9.01 Financial Statements and Exhibits.**

**(a) Financial Statements of Business Acquired.**

In accordance with Item 9.01(a), the audited financial statements of Tiltan as of December 31, 2024 and December 31, 2023 and for the years then ended are attached hereto as Exhibit 99.1 to this Current Report on Form 8-K and are incorporated herein by reference.

In accordance with Item 9.01(a), the unaudited condensed financial statements of Tiltan for the nine months ended September 30, 2025 are attached hereto as Exhibit 99.2 to this Current Report on Form 8-K and are incorporated herein by reference.

**(b) Pro Forma Financial Information.**

The unaudited pro forma condensed combined financial information required by this Item 9.01(b) is not included with this Current Report on Form 8-K and will be filed by amendment no later than 71 calendar days after the date this Current Report on Form 8-K is required to be filed.

**(d) Exhibits.**

---

| | |
|:---|:---|
| **Exhibit No.** | **Description** |
| 4.1\* | [Secured Promissory Note, dated December 30, 2025, issued by Nukkleus Inc. in favor of Arie Shafir.](ea027122001ex4-1_nukkleus.htm) |
| 10.1\* | [Amendment to Stock Purchase Agreement, dated December 30, 2025, by and among Nukkleus Inc., Nukk Picolo Ltd., Tiltan Software Engineering Ltd., and Arie Shafir.](ea027122001ex10-1_nukkleus.htm) |
| 10.2\* | [Pledge Agreement, dated December 30, 2025, by and between Nukk Picolo Ltd. and Arie Shafir.](ea027122001ex10-2_nukkleus.htm) |
| 10.3\* | [Escrow Agreement, dated December 30, 2025, by and among Nukkleus Inc., Arie Shafir and Adv. Lior Hinkus, as escrow agent.](ea027122001ex10-3_nukkleus.htm) |
| 99.1\* | [Audited Financial Statements of Tiltan Software Engineering Ltd. as of December 31, 2024 and 2023 and for the years then ended.](ea027122001ex99-1_nukkleus.htm) |
| 99.2\* | [Unaudited Condensed Financial Statements of Tiltan Software Engineering Ltd. for the nine months ended September 30, 2025.](ea027122001ex99-2_nukkleus.htm) |
| 99.3\* | [Press Release, dated December 30, 2025.](ea027122001ex99-3_nukkleus.htm) |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). |

---

\* Filed herewith.

**SIGNATURES**

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

---

| | | |
|:---|:---|:---|
|  | **NUKKLEUS INC.** | **NUKKLEUS INC.** |
| Date: December 30, 2025 |  |  |
|  | By: | /s/ Menachem Shalom |
|  | Name: | Menachem Shalom |
|  | Title: | Chief Executive Officer |

---

## Exhibit 4.1

**Exhibit 4.1**

**SECURED PROMISSORY NOTE**

NEITHER THE ISSUANCE AND SALE OF THIS NOTE NOR THE SECURITIES SECURING THIS NOTE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THIS NOTE MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL TO THE HOLDER (IF REQUESTED BY THE COMPANY), IN FORM REASONABLY ACCEPTABLE TO THE COMPANY, THAT REGISTRATION IS NOT REQUIRED, OR (II) UNLESS SOLD OR ELIGIBLE TO BE SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT.

**NUKKLEUS INC.**

**SECURED PROMISSORY NOTE**

NIS 29,750,000 December 30, 2025

This Secured Promissory Note (this "**Note**") is issued pursuant to the terms and provisions of that certain Stock Purchase Agreement dated as of September 1, 2025, as amended by the Amendment dated December 30, 2025 (collectively, the "**Purchase Agreement**"), by and among Tiltan Software Engineering Ltd. ("**Tiltan**"), Nukkleus Inc., Nukk Picolo Ltd. ("**the Subsidiary**"), and Arie Shafir ("**the Shareholder**"). Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to such terms in the Purchase Agreement.

1. <u>Principal and Interest</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1 **Promise to Pay.** Nukkleus Inc., a Delaware corporation (the "**Company**"), for value received, hereby promises to pay to the Shareholder (the "**Holder**") the principal amount of NIS 29,750,000 (Twenty-Nine Million Seven Hundred Fifty Thousand Israeli Shekels).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2 **Payment Schedule**. The outstanding principal amount shall be paid in five (5) equal installments of NIS 5,950,000 each, with payments due as follows:

● First installment (minus NIS 666,667.00): 36 days after the Closing Date (as defined in the Purchase Agreement)

● Second installment (minus NIS 666,667.00): 72 days after the Closing Date

● Third installment: 108 days after the Closing Date

● Fourth installment: 144 days after the Closing Date

● Fifth installment: 180 days after the Closing Date (such date hereinafter referred to as the "**Settlement Date** ")

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3 <u>Interest</u>. This Note shall not bear interest unless an Event of Default occurs, in which case interest shall accrue at the rate of 10% per annum from the date of default until payment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.4 Upon full payment of this Note, it shall be marked "**Cancelled**" and surrendered to the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. <u>Security.</u> This Note is secured by a first-priority lien on the common stock of Tiltan as set forth in the Pledge Agreement dated the date hereof between the Subsidiary and the Shareholder. The lien shall be released upon full satisfaction of this Note.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. <u>Prepayment</u>. The Company may prepay all or any portion of the principal amount due under this Note at any time without penalty or premium. In the event of prepayment, the Settlement Date shall be deemed to occur on the date of final payment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. <u>Events of Default</u>. If any Event of Default occurs, the entire unpaid principal amount shall become immediately due and payable, and interest shall accrue from such date at 10% per annum until payment.

The following shall constitute an "**Event of Default**":

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Failure by the Company to pay any installment within ten (10) business days after its due date after written
notification is received by the Company;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Company or the Subsidiary files for bankruptcy, insolvency, reorganization, or similar relief;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) An involuntary petition in bankruptcy is filed against the Company or the Subsidiary and not dismissed
within ninety (90) days;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Appointment of a receiver, custodian, or trustee for the Company or the Subsidiary or its respective assets;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Material breach of the Purchase Agreement not cured within the specified cure period; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Dissolution, winding up, or cessation of business by the Company or the Subsidiary for a continuous period
of twenty (20) days.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. <u>Assignment</u>. Neither party may assign its rights or obligations under this Note without the prior written consent of the other party. This Note shall be binding upon and inure to the benefit of the parties and their respective successors, permitted assigns, heirs, administrators, and transferees.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. <u>Amendments and Waivers</u>. This Note may be amended or waived only with the written consent of both the Company and the Holder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. <u>Notices</u>. All notices required or permitted shall be in writing and deemed effectively given upon personal delivery, deposit with an internationally recognized courier, or confirmation of receipt when sent by registered or certified mail, to the addresses set forth in the Purchase Agreement (or as updated by notice).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. <u>Governing Law; Jurisdiction.</u> This Note shall be governed by and construed in accordance with the laws of the State of Delaware, without regard to conflicts of laws. Disputes shall be resolved in accordance with the provisions of the Purchase Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9. <u>Currency</u>. All payments under this Note shall be made in Israeli Shekels (NIS). Payments in another currency shall be converted at the exchange rate published by the Bank of Israel on the date of payment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10. <u>Miscellaneous</u>.

● **Business Days**. If a payment date falls on a non-Business Day, payment shall be made on the next Business Day.

● **Replacement.** Upon proof of loss or destruction of this Note, the Company shall issue a replacement Note.

● **Severability.** If any provision is held unenforceable, the remainder shall remain valid.

● **No Waiver by Delay.** Delay or failure in exercising any right shall not operate as a waiver.

● **Entire Agreement.** This Note and the Purchase Agreement constitute the entire agreement of the parties regarding this subject matter.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11. <u>No Stockholder Rights</u>. This Note does not confer upon the Holder any rights as a shareholder of the Company.

*[remainder of this page intentionally left blank]*

 

IN WITNESS WHEREOF, the Company has caused this Note to be executed as of the date first written above.

---

| | |
|:---|:---|
| **NUKKLEUS INC.** | **NUKKLEUS INC.** |
| By: | /s/ Menachem Shalom |
| Name: | Menachem Shalom |
| Title: | CEO |

---

---

| |
|:---|
| **ACKNOWLEDGED AND AGREED:** |
| **HOLDER:** |
| /s/ Arie Shafir |
| Name: Arie Shafir |

---

## Exhibit 10.1

**Exhibit 10.1**

**AMENDMENT TO STOCK PURCHASE AGREEMENT**

This Amendment to Stock Purchase Agreement (this "**Amendment**") is made and entered into as of December 30, 2025, by and among Tiltan Software Engineering Ltd., an Israeli corporation (the "**Company**"), Nukkleus Inc., a Delaware corporation (the "**Buyer**"), Nukk Picolo Ltd., an Israeli company which is wholly owned by the Buyer (the "**Subsidiary**"), and Arie Shafir (Israeli ID 067242404) (the "**Shareholder**").

**WHEREAS**, the parties entered into that certain Stock Purchase Agreement dated as of September 1, 2025 (the "**Agreement**"; unless otherwise defined, capitalized terms used in this Amendment shall have the meanings ascribed to such terms in the Agreement); and

**WHEREAS**, the parties desire to amend the Agreement on the terms contained herein;

**NOW, THEREFORE**, in consideration of the mutual covenants and agreements hereinafter set forth and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:

**1.**  **<u>Closing and Closing Date.</u>** 

The Agreement is hereby amended by deleting Section 2.3.1 in its entirety and replacing said Section with the following:

"2.3.1 The parties agree that the consummation of the Transaction (the "**Closing**") shall take place simultaneously with the execution and delivery of this Amendment. Accordingly, December 30, 2025 is the "**Closing Date**"."

**2.**  **<u>Non-Competition and Non-Solicitation</u>** 

The Shareholder shall be subject to non-competition and non-solicitation covenants from the date hereof and continuing for a period of twelve (12) months following the Settlement Date.

**3.**  **<u>Pre-Closing Dividend and Payments.</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;3.1. In accordance with Section 2.1 of the Agreement, the Shareholder, in his capacity as the sole shareholder
and director of the Company, declared a dividend in the amount of NIS 3,158,000 (the "**Pre-Closing Dividend**") for the
year ended December 31, 2025. The Shareholder and the Company agree and acknowledge that the Pre-Closing Dividend shall be paid by the
Company to the Shareholder during the 2026 calendar year from retained earnings funds, customer invoices and Israel Tax Authority indicated
on Schedule A attached hereto.

&nbsp;&nbsp;&nbsp;&nbsp;3.2. On December 31, 2025, the Buyer shall pay to the Shareholder an amount equal to NIS 5,283,333 converted
to U.S. Dollars at the exchange rate published by the Bank of Israel on Wednesday, December 31, 2025 afternoon (the "**First Payment** ").

&nbsp;&nbsp;&nbsp;&nbsp;3.3. The Buyer agrees that Shareholder can request to receive the payments on the Note in US dollars in accordance
with the current exchange rate at the time said payment is due.

4.  **<u>Reference</u>** .

On and after the date hereof, each reference in the Agreement to "this Agreement", "hereunder", "hereof", "herein", and words of like import, and each reference to the Agreement in any other agreement, document or other instrument, shall mean, and be a reference to the Agreement, as amended by this Amendment.

5.  **<u>Governing Law</u>** .

This Amendment shall be governed by, construed and enforced in accordance with Sections 9.10 and 9.11 of the Agreement.

6.  **<u>Counterparts</u>** .

This Amendment may be executed and delivered (including by facsimile or other electronic transmission, such as by electronic mail in "pdf" form) in one or more counterparts, and by the different parties hereto in separate counterparts, each of which when executed shall be deemed to be an original, but all of which taken together shall constitute one and the same agreement.

*[Remainder of Page Intentionally Left Blank; Signature Page Follows]*

**IN WITNESS WHEREOF**, the parties hereto have caused this Amendment to Stock Purchase Agreement to be executed as of the date first written above.

---

| | |
|:---|:---|
| **TILTAN SOFTWARE ENGINEERING LTD.** | **TILTAN SOFTWARE ENGINEERING LTD.** |
| By: | /s/ Arie Shafir |
| Name: | Arie Shafir |
| Title: | CEO |
| **NUKK PICOLO LTD.** | **NUKK PICOLO LTD.** |
| By: | /s/ Menny Shalom |
| Name: | Menny Shalom |
| Title: | CEO |
| **NUKKLEUS INC.** | **NUKKLEUS INC.** |
| By: | /s/ Menny Shalom |
| Name: | Menny Shalom |
| Title: | CEO |
| **SHAREHOLDER:** | **SHAREHOLDER:** |
| **By:** | /s/ Arie Shafir |
|  | Arie Shafir |

---

## Exhibit 10.2

**Exhibit 10.2**

**<u>PLEDGE AGREEMENT</u>**

This Pledge Agreement (this "**Agreement**") is made and entered into as of December 30, 2025, by and between **Nukk Picolo Ltd. (C.N. 517090387)**, an Israeli private company incorporated under the laws of the state of Israel with its registered offices at 33 Yehoshua Ben Noon St., Tel Aviv, Israel (the "**Pledgor**"), and Arie Shafir (Israeli ID 067242404) with its registered address at 25 Haharuv St., Petah Tikva, Israel (the "**Pledge**e").

**WHEREAS**, the Pledgor is the legal owner of 100 (one hundred) shares, par value NIS 1 (one) per share, of Tiltan Software Engineering Ltd. (C.N. 515196582), an Israeli private company ("**Tiltan**") which are all the issued and outstanding common stock of Tiltan;

**WHEREAS**, the Pledgor is wholly owned by Nukkleus Inc., a Delaware corporation (the "**Company**");

**WHEREAS**, the Company is indebted to the Pledgee in the amount of NIS 29,750,000 (Twenty-Nine Million Seven Hundred Fifty Thousand Israeli Shekels) (the "**Secured Debt**"), which Secured Debt is represented by the Secured Note dated the date hereof between the Company and the Pledgee.

**NOW, THEREFORE**, in consideration of the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

1. <u>The Pledge</u>. The Pledgor hereby pledges, assigns, and transfers to the Pledgee a first-priority security
interest in all of its right, title, and interest in and to all of Tiltan shares holds and owned by it (the "**Pledged Assets** ").

2. <u>Purpose of Pledge</u>. To secure the full payment and performance of the Secured Debt in accordance with
the terms and provisions of the Secured Note.

3. <u>Representations and Warranties of Pledgor</u>. The Pledgor represents and warrants to the Pledgee that
(i) It has full power and authority to enter into this Agreement and to pledge the Pledged Assets; and (ii) it is the sole legal and beneficial

and applicable securities laws; and (iii) the execution and delivery of this Agreement will not violate any law, agreement, or instrument
to which the Pledgor is a party or by which it is bound; and (iv) this Agreement has been approved by its competent authorities according
to its incorporation documents and the signature of Mr. Menny Shalom on this Agreement is binding the Pledgor for all intents and purposes.

4. <u>Covenants</u>. The Pledgor covenants and agrees that it shall not sell, transfer, assign, or create any
further lien or security interest on the Pledged Assets without the prior written consent of the Pledgee.

5. <u>Registration</u>. The Pledgor and the Pledgee agree to take all necessary actions to register this Agreement
with all relevant authorities, including but not limited to, the Registrar of Companies in Israel, in accordance with applicable law.

6. <u>Release and Cancel of Pledge</u>. Upon full payment of all the amounts due and secured under the Secured
Note, the Pledgee shall immediately take all necessary steps to release the Pledgor from its obligations under this Agreement and cancel
the registration of pledge with all relevant authorities, including but not limited to, the Registrar of Companies.

7. <u>Events of Default</u>. If any Event of Default as defined in the Secured Note shall occur, the Pledgee
shall have the right to exercise any and all remedies available to it under law or equity, including but not limited to, the right to
take possession of and sell the Pledged Assets to satisfy the Secured Debt.

8. <u>Assignment</u>. Neither party may assign its rights or obligations under this Agreement without the prior
written consent of the other party. This Agreement shall be binding upon and inure to the benefit of the parties and their respective
successors, permitted assigns, heirs, administrators, and transferees.

9. <u>Amendments and Waivers</u>. This Agreement may be amended or waived only with the written consent of the
Company, the Pledgor and the Pledgee.

10. <u>Notices</u>. All notices required or permitted shall be in writing and deemed effectively given upon personal
delivery, deposit with an internationally recognized courier, or confirmation of receipt when sent by registered or certified mail, to
the addresses set forth in the Purchase Agreement (or as updated by notice).

11. <u>Governing Law; Jurisdiction.</u> This Note shall be governed by and construed in accordance with the laws
of the State of Delaware, without regard to conflicts of laws. Disputes shall be resolved in accordance with the provisions of the Purchase
Agreement dated September 1<sup>st</sup>, 2025 and the amendment as of December 30, 2025 among the Company, Tiltan, the Pledgor and the
Pledgee.

*[remainder of this page intentionally left blank]*

 

 

IN WITNESS WHEREOF, the parties have executed this Pledge Agreement as of date first written above.

---

| | |
|:---|:---|
| **Nukk Picolo Ltd.** [The Pledgor] | **Nukk Picolo Ltd.** [The Pledgor] |
| By: | Menny Shalom |
| Title: | CEO |
| Signature: | /s/ Menachem Shalom |
| **Arie Shafir** [The Pledgee] | **Arie Shafir** [The Pledgee] |
| Signature: | /s/ Arie Shafir |
| **Nukkleus Inc.** [The Company] | **Nukkleus Inc.** [The Company] |
| By: | Menny Shalom |
| Title: | CEO |
| Signature: | /s/ Menachem Shalom |

---

## Exhibit 10.3

**Exhibit 10.3**

**Escrow Agreement** 

This ESCROW AGREEMENT (this "**Escrow Agreement**") is entered into as of December 30, 2025, by and among Nukkleus Inc, a Delaware corporation (the "**Buyer**"), Nukk Picolo Ltd, an Israeli company which is wholly owned by the Buyer (the "**Subsidiary**"), Arie Shafir, Israeli ID 067242404 (the "**Shareholder**"), and Adv. Lior Hinkus, Israeli ID 033346982 (the "**Escrow Agent**").

**RECITALS:**

---

| | |
|:---|:---|
| **WHEREAS,** | the Buyer and the Shareholder have entered into that certain Stock Purchase Agreement dated as of September 1, 2025, as amended by the Amendment dated as of the date hereof (together, the "**Purchase Agreement**"), pursuant to which the Buyer is acquiring all of the issued and outstanding shares of Tiltan Software Engineering Ltd., an Israel corporation (the "**Company**") fully owned by the Shareholder; |

---

---

| | |
|:---|:---|
| **WHEREAS,** | pursuant to Section 2.2 of the Purchase Agreement, a portion of the consideration is payable in shares of common stock of Nukkleus, Inc. (the "**Compensation Shares**") to be deposited into escrow for release to the Shareholder on the Settlement Date; |

---

---

| | |
|:---|:---|
| **WHEREAS,** | the parties desire to appoint the Escrow Agent to hold and distribute the Compensation Shares (as defined below) in accordance with the terms and conditions set forth herein; |

---

**NOW THEREFORE, in consideration of the mutual promises herein contained and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.  **<u>DEFINITIONS</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1. **Defined Terms.** Capitalized
 terms used but not defined herein shall have the meanings ascribed to them in the Purchase
 Agreement. In addition, the following terms shall have the following meanings:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) "Business Day" means any day
 that is not a Saturday, Sunday, or legal holiday in the State of New York, United States,
 or in the State of Israel.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) "Closing Date" means December
 30, 2025, the date of the closing of the transactions contemplated by the Purchase Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) "Compensation Shares" has
 the meaning set forth in Section 2.2 of the Purchase Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) "Escrowed Shares" means the
 Compensation Shares deposited with the Escrow Agent pursuant to Section 2.1 of this Escrow
 Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) "Purchase Price" means NIS
 47,600,000 (forty-seven million and six hundred thousand New Israeli Shekels).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) "Settlement Date" means the
 date that is one hundred eighty (180) days after the Closing Date, or such earlier date as
 the Buyer and the Shareholder may jointly instruct the Escrow Agent in writing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.  **<u>DEPOSIT AND RELEASE OF ESCROWED SHARES</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1. **Initial Deposit**. On or promptly
 after the Closing Date, the Buyer shall deposit with the Escrow Agent certificates or book-entry
 shares representing the Compensation Shares, which number equals fifty percent (50%) of the
 Purchase Price divided by the Market Price of a Nukk Share on the Closing Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2. **True-Up Release on Settlement**.
 On the Settlement Date the Escrow Agent shall release to the Shareholder a number of Escrowed
 Shares in an amount equal to 25% of the Purchase Price divided by the Market Price of a Nukk
 Share on the Settlement Date. The remainder of the Escrowed Shares shall be cancelled / forfeited.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3. If the value of the Escrowed Shares
 (as determined by multiplying the amount of Escrow Shares the Market Price of a Nukk Share
 on the Settlement Date) equals less than 25% of the Purchase Price (i.e., 11,900,000), the
 Escrow Agent shall release to the Shareholder all the Escrowed Shares and the Buyer shall
 in its sole discretion have the right to either (i) issue to the Shareholder additional Nukk
 Shares in the amount needed so the Shareholder will have been issued the Nukk Shares equal
 in value to 25% of the Purchase Price as of the Closing Date or (ii) pay the Shareholder
 the difference in cash.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4. **Acceptance by Escrow Agent**.
 The Escrow Agent hereby acknowledges receipt of the Escrowed Shares and agrees to hold and
 distribute such shares in accordance with the terms and conditions of this Escrow Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.5. **Investment of Escrowed Shares**.
 The Escrowed Shares shall be held in the form deposited and shall not be sold, transferred,
 or otherwise disposed of by the Escrow Agent except in accordance with this Escrow Agreement.
 The Escrow Agent shall have no responsibility for any investment decisions regarding the
 Escrowed Shares.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.  **<u>EARLIER RELEASE OF ESCROWED SHARES</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1. **Earlier Release by Joint Instruction.** The Escrow Agent shall, upon receipt of Joint Written Instructions executed by the Buyer
 and the Shareholder, release some or all of the Escrowed Shares prior to the Settlement Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2. **Voting Rights and Dividends During Escrow.** The Shareholder shall not have any rights with respect to the Escrowed Shares
 until their release. Any cash dividends or cash distributions declared on the Escrowed Shares
 for the period commencing after the Closing Date and continuing during the Escrow Period
 shall be paid to the Shareholder; any stock dividends, splits or similar equity distributions
 with respect to the Escrowed Shares shall be added to the Escrowed Shares and released with
 the Escrowed Shares.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.  **<u>REPRESENTATIONS AND WARRANTIES</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1. **Representations of the Buyer and Shareholder**. Each of the Buyer and the Shareholder represents and warrants to the Escrow
 Agent that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) It has full power and authority to execute
 and deliver this Escrow Agreement and to perform its obligations hereunder;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) This Escrow Agreement has been duly authorized,
 executed, and delivered by it and constitutes its legal, valid, and binding obligation;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Its execution and performance of this
 Escrow Agreement will not violate any law, regulation, order, judgment, or agreement to which
 it is subject.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2. **Representations of the Escrow Agent**.
 The Escrow Agent represents and warrants that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) It has full power and authority to execute
 and deliver this Escrow Agreement and to perform its obligations hereunder;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) It is validly existing, and in good standing
 under the laws of its jurisdiction of acting his business;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The execution and performance of this
 Escrow Agreement have been duly authorized.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.  **<u>DISPUTE RESOLUTION</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1. **Notice of Dispute**. If any dispute
 arises concerning the release or retention of the Escrowed Shares, any party may deliver
 written notice of such dispute to the other parties and the Escrow Agent.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2. **Resolution Period**. Upon receipt
 of a dispute notice, the Buyer and Shareholder shall have fifteen (15) Business Days to resolve
 the dispute and provide Joint Written Instructions to the Escrow Agent, failing which the
 Escrow Agent shall continue to hold the Escrowed Shares pending resolution under Section
 5.3.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3. **Continued Holding**. During any
 dispute, the Escrow Agent shall continue to hold the Escrowed Shares until: (a) Receipt of
 Joint Written Instructions from the Buyer and the Shareholder; or (b) Receipt of a final,
 non-appealable order from a court of competent jurisdiction; or (c) Receipt of a written
 arbitration award if the parties agree to arbitration.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.4. **Interpleader**. The Escrow Agent
 may, at its option, file an action in interpleader in any court of competent jurisdiction
 and deposit the Escrowed Shares with such court.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.  **<u>ESCROW AGENT PROVISIONS</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1. **Duties Limited**. The Escrow
 Agent:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Shall have no duties or obligations except
 those expressly set forth herein;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Shall not be required to take any action
 that it believes would expose it to liability or expense;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) May rely upon any written notice, instruction,
 or request furnished to it hereunder and believed by it to be genuine;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Shall not be responsible for the validity
 or sufficiency of this Escrow Agreement or the Purchase Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2.  **<u>Indemnification.</u>** The
 Buyer and the Shareholder jointly and severally agree to indemnify and hold harmless the
 Escrow Agent from and against any losses, claims, damages, liabilities, and expenses (including
 reasonable attorneys' fees) arising out of or in connection with its services hereunder,
 except to the extent caused by the Escrow Agent's gross negligence or willful misconduct.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3.  **<u>Compensation.</u>** The Buyer
 shall pay the Escrow Agent a fee of NIS 3,000 upon execution of this Escrow Agreement for
 its services hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.4.  **<u>Resignation.</u>** The Escrow
 Agent may resign at any time upon thirty (30) days' prior written notice to the other parties.
 In such event, the Buyer and Shareholder shall jointly appoint a successor escrow agent within
 such thirty-day period.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.5.  **<u>Liability.</u>** The Escrow
 Agent shall not be liable for any action taken or omitted in good faith and believed by it
 to be authorized or within its rights or powers hereunder, except for damages arising from
 its gross negligence or willful misconduct.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.  **<u>MISCELLANEOUS</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1. **Notices**. All notices required
 hereunder shall be in writing and delivered in accordance with Section 10.2 of the Purchase
 Agreement, with notices to the Escrow Agent delivered to:

**<u>[Escrow Agent Name]</u>**

_______________________________

Attention: ______________________

Email: _________________________

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2. **Governing Law**. This Escrow
 Agreement shall be governed by and construed in accordance with the laws of the State of
 Delaware, without regard to its conflict of laws principles. Disputes shall be resolved in
 accordance with the provisions of the Purchase Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.3. **Entire Agreement**. This Escrow
 Agreement constitutes the entire agreement among the parties with respect to the subject
 matter hereof and supersedes all prior agreements and understandings.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.4. **Amendment**. This Escrow Agreement
 may not be amended except by written instrument signed by all parties hereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.5. **Counterparts**. This Escrow Agreement
 may be executed in counterparts, each of which shall be deemed an original, but all of which
 together shall constitute one and the same instrument.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.6. **Severability**. If any provision
 of this Escrow Agreement is held invalid or unenforceable, the remaining provisions shall
 continue in full force and effect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.7. **Termination**. This Escrow Agreement
 shall terminate upon the final distribution of all Escrowed Shares and payment of all fees
 due to the Escrow Agent.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.8. **Tax Reporting.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Shareholder shall provide the Escrow
 Agent with a properly completed IRS Form W-9 or W-8, as applicable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Escrow Agent shall report the release
 of Escrowed Shares as required by applicable law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Each party shall be responsible for its
 own tax obligations arising from the transactions contemplated hereby.

*[Signature Page to Follow]*

 

**IN WITNESS WHEREOF** the parties have executed this Escrow Agreement as of the date first written above.

**Nukkleus, INC.**

By: _________________________

Name: ______________________

Title: _______________________

**SHAREHOLDER**

By: _________________________

Name: ______________________

**ESCROW AGENT**

By: _________________________

Name: ______________________

Title:_______________________

**SCHEDULE A**

**FORM OF JOINT WRITTEN INSTRUCTION**

Date: ___________

To: [Escrow Agent Name and Address]

Re: Release of Escrowed Shares under that certain Escrow Agreement dated as of __________, 2025 (the "**Escrow Agreement**") by and among Nukkleus, Inc. (the "**Buyer**"), Arie Shafir (the "**Shareholder**"), and [Escrow Agent] (the "Escrow Agent").

The undersigned hereby jointly instruct the Escrow Agent to release __________ Nukk Shares from the Escrowed Shares to the Shareholder (Arie Shafir) pursuant to the Escrow Agreement.

This release is made in connection with (check one):

☐ Settlement Date release

☐ Earlier release pursuant to Section 3.2 (specify): _________________

Please deliver the released shares as follows: [insert delivery mechanics / DTC/book-entry details].

**Buyer: ___________**

Name/Title:_________________________<br>

Shareholder:___________________

Date:_______<br> Name: **Arie Shafir**

## Exhibit 99.1

**Exhibit 99.1**

**TILTAN SOFTWARE ENGINEERING LTD.**

FINANCIAL STATEMENTS

AS OF DECEMBER 31, 2024

**TILTAN SOFTWARE ENGINEERING LTD.**

FINANCIAL STATEMENTS

AS OF DECEMBER 31, 2024

**TABLE OF CONTENTS**

---

| | |
|:---|:---|
|  | **Page** |
| [**INDEPENDENT AUDITORS' REPORT**](#a_001) | F-3 |
| **FINANCIAL STATEMENTS:** |  |
| &nbsp;&nbsp;&nbsp;[Balance Sheets as of December 31, 2024 and December 31, 2023](#a_002) | F-5 |
| &nbsp;&nbsp;&nbsp;[Statements of Comprehensive Income for the years ended December 31, 2024 and 2023](#a_003) | F-6 |
| &nbsp;&nbsp;&nbsp;[Statements of Changes in Stockholders' Equity for the years ended December 31, 2024 and 2023](#a_004) | F-7 |
| &nbsp;&nbsp;&nbsp;[Statements of Cash Flows for the years ended December 31, 2024 and 2023](#a_005) | F-8 |
| &nbsp;&nbsp;&nbsp;[Notes to Financial Statements](#a_006) | F-9 – F-23 |

---

![](ex99-1_001.jpg)

![](ex99-1_002.jpg)

Somekh Chaikin

8 Hartum Street, Har Hotzvim

PO Box 212

Jerusalem 9100102, Israel

+972 2 5312000

**Independent Auditors' Report**

To the Stockholders of Tiltan Software Engineering Ltd.

**Report on the Audit of the Financial Statements**

 

*Opinion*

 

We have audited the financial statements of Tiltan Software Engineering Ltd. (the Company), which comprise the balance sheets as of December 31, 2024 and 2023, and the related statements of comprehensive income, changes in stockholders' equity, and cash flows for the years then ended, and the related notes to the financial statements.

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for the years then ended in accordance with U.S. generally accepted accounting principles.

 

*Basis for Opinion*

 

We conducted our audits in accordance with auditing standards generally accepted in the United States of America (GAAS). Our responsibilities under those standards are further described in the Auditors' Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the Company and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audits. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

 

*Responsibilities of Management for the Financial Statements*

 

Management is responsible for the preparation and fair presentation of the financial statements in accordance with U.S. generally accepted accounting principles, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company's ability to continue as a going concern for one year after the date that the financial statements are issued.

 

 

KPMG Somekh Chaikin, an Israeli partnership and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee

![](ex99-1_002.jpg)

Somekh Chaikin

8 Hartum Street, Har Hotzvim

PO Box 212

Jerusalem 9100102, Israel

+972 2 5312000

*Auditors' Responsibilities for the Audit of the Financial Statements*

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors' report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.

In performing an audit in accordance with GAAS, we:

● Exercise professional judgment and maintain professional skepticism throughout the audit.

● Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

● Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control. Accordingly, no such opinion is expressed.

● Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.

● Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company's ability to continue as a going concern for a reasonable period of time.

We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control related matters that we identified during the audit.

![](ex99-1_003.jpg)

**Somekh Chaikin**

**Member Firm of KPMG International**

**Jerusalem, Israel**

December 15, 2025

KPMG Somekh Chaikin, an Israeli partnership and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee

**TILTAN SOFTWARE ENGINEERING LTD.**

BALANCE SHEETS

(USD in thousands except share and per share data)

---

| | | |
|:---|:---|:---|
|  | **December 31,<br> 2024** | **December 31,<br> 2023** |
| **Assets** | | |
| **Current Assets** | | |
| &nbsp;&nbsp;&nbsp;Cash and cash equivalents | 2532 | 3691 |
| &nbsp;&nbsp;&nbsp;Short term bank deposit | 17 |  |
| &nbsp;&nbsp;&nbsp;Marketable securities | 252 | 230 |
| &nbsp;&nbsp;&nbsp;Accounts receivable, less allowance for credit losses of $58 in 2024 and 2023 | 164 | 1484 |
| &nbsp;&nbsp;&nbsp;Other current assets – related party (Note 12) | 19 | 96 |
| &nbsp;&nbsp;&nbsp;Other current asset | 48 | 64 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total Current Assets** | **3032** | **5565** |
| **Deferred taxes (Note 11)** | **175** | **160** |
| **Operating lease right-of-use asset (Note 3)** | **161** | **89** |
| **Other asset – long term** | **-** | **22** |
| **Property and equipment, net** | **49** | **54** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total Assets** | **3417** | **5890** |
| **Liabilities and Shareholders' Deficit**<br>|  |  |
| **Current Liabilities** |  |  |
| &nbsp;&nbsp;&nbsp;Current portion of long- term loans from bank (Note 5) | 13 | 11 |
| &nbsp;&nbsp;&nbsp;Accounts payable | 31 | 17 |
| &nbsp;&nbsp;&nbsp;Operating lease liability (Note 3) | 152 | 45 |
| &nbsp;&nbsp;&nbsp;Other current liabilities (Note 4) | 2128 | 737 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total current liabilities** | 2324 | 810 |
| **Long term loans from Banks (Note 5)** | 9 | 22 |
| **Operating lease liability (Note 3)** | 10 | 44 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total Liabilities** | **2343** | **876** |
| **Stockholders' Equity (Note 6)** |  |  |
| &nbsp;&nbsp;&nbsp;Common stock of NIS 1 par value each ("Common Stock"): |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 10,000 shares authorized as of December 31, 2024 and 2023; issued and outstanding 100 shares as of December 31, 2024 and 2023. | (\*) | (\*) |
| Retained earnings | 1074 | 5014 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total Stockholders' Equity** | 1074 | 5014 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total liabilities and stockholders' Equity** | **3417** | **5890** |

---

---

| | |
|:---|:---|
| (\*) | represents amount less than $1 thousand. |

---

**The accompanying notes are an integral part of the financial statements.**

**TILTAN SOFTWARE ENGINEERING LTD.**

STATEMENTS OF COMPREHENSIVE INCOME

(USD in thousands except share and per share data)

---

| | | |
|:---|:---|:---|
|  | **Year ended December 31** | **Year ended December 31** |
|  | **2024** | **2023** |
| Revenues (Note 7) | 2964 | 4395 |
| Cost of revenues (Note 8) | (562) | (537) |
| **Gross profit** | **2402** | **3858** |
| Research and development expenses (Note 9) | (1165) | (1025) |
| General and administrative expenses (Note 10) | (404) | (432) |
| &nbsp;&nbsp;&nbsp;**Operating Income** | **833** | **2401** |
| Financial income (expenses), net | 108 | (148) |
|  | **941** | **2253** |
| **Taxes on income (Note 11)** | (119) | (283) |
| **Total comprehensive income** | **822** | **1970** |

---

**The accompanying notes are an integral part of the financial statements.**

**TILTAN SOFTWARE ENGINEERING LTD.**

STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

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

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Number of**<br> **Shares** | **Amount** | **Additional paid-in capital** | **Retained earnings** | **Total<br> stockholders'<br> equity** |
| **BALANCE AT JANUARY 1, 2023** | **100** | **(\*)** |  | **3044** | **3044** |
| &nbsp;&nbsp;&nbsp;Total comprehensive income for the year |  |  |  | 1970 | 1970 |
| **BALANCE AT DECEMBER 31, 2023** | **100** | **(\*)** |  | **5014** | **5014** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Declared and Paid Dividend: | **-** |  |  | (4762) | **(4762)** |
| Common shares $47,620/share |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Total comprehensive income for the year | **-** | - |  | 822 | **822** |
| **BALANCE AT DECEMBER 31, 2024** | **100** | **(\*)** |  | **1074** | **1074** |

---

---

| | |
|:---|:---|
| (\*) | represents amount less than $1 thousand. |

---

**The accompanying notes are an integral part of the financial statements.**

**TILTAN SOFTWARE ENGINEERING LTD.**

STATEMENTS OF CASH FLOWS

(USD in thousands)

---

| | | |
|:---|:---|:---|
|  | **Year ended December 31** | **Year ended December 31** |
|  | **2024** | **2023** |
| **CASH FLOWS FROM OPERATING ACTIVITIES:** |  |  |
| &nbsp;&nbsp;&nbsp;Total comprehensive income for the year | 822 | 1970 |
| &nbsp;&nbsp;&nbsp;**Adjustments required to reconcile net loss for the year to net cash used in operating activities:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation | 18 | 28 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest expenses | (1) | (2) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Change in the fair value of securities | (14) | 40 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Change in deferred taxes | (15) | (9) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Change in right of use asset | 157 | 145 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Change in lease liability | (157) | (145) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Decrease (increase) in accounts receivable | 1320 | (1224) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Decrease (increase) in other current assets | 115 | (7) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Increase (decrease) in accounts payable | 14 | (1) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Increase (decrease) in other liabilities | 1392 | (183) |
| &nbsp;&nbsp;&nbsp;Net cash provided by operating activities | 3651 | 612 |
| **CASH FLOWS FROM INVESTING ACTIVITIES:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Purchase of property and equipment | (12) | (3) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Purchase of securities | (31) | (45) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Increase in short term bank deposit | (17) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proceeds from sale of securities | 23 | 47 |
| Net cash used in investment activities | (37) | (1) |
| **CASH FLOWS FROM FINANCING ACTIVITIES:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Repayment of loans from banking institutions | (11) | (13) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Payment of dividend | (4762) |  |
| Net cash used in financing activities | (4773) | (13) |
| **INCREASE IN CASH AND CASH EQUIVALENTS** |  |  |
| &nbsp;&nbsp;&nbsp;Increase (decrease) in Cash and Cash Equivalents | (1159) | 598 |
| **CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR** | 3691 | 3093 |
| **CASH AND CASH EQUIVALENTS AT END OF YEAR** | 2532 | 3691 |
| **Supplemental disclosure of cash flow information:** |  |  |
| **Non cash transactions:** |  |  |
| Initial recognition of operating lease right-of-use assets and liabilities | 230 | 101 |
| **Cash transactions:** |  |  |
| Interest | 1 | 1 |
| Taxes | 347 | 211 |

---

**The accompanying notes are an integral part of the financial statements.**

**TILTAN SOFTWARE ENGINEERING LTD.**

NOTES TO FINANCIAL STATEMENTS

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

**NOTE 1 – GENERAL**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. Tiltan Software Engineering Ltd. (hereinafter: "Company", "us", "our"
or "we") was incorporated in 2015. The Company develops advanced simulation and geo-spatial intelligence technologies that
reduce costs, accelerate development, and ensure operational reliability. The company delivers synthetic data tools that train AI systems,
autonomous navigation solutions for aircraft and drones, high-resolution geo-mapping platforms for turning airborne and spaceborne imagery
into actionable insights, and simulation environments that support defense, aerospace, and commercial applications.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. On October 7, 2023, Hamas launched a series of attacks on civilian and military targets in Southern Israel
and Central Israel, to which the Israel Defense Forces have responded. In addition, both Hezbollah and the Houthi movement have attacked
military and civilian targets in Israel, to which Israel has responded, including through increased air and ground operations in Lebanon.
In addition, the Houthi movement has attacked international shipping lanes in the Red Sea, to which both Israel and the United States
have responded. Further, on April 13, 2024 and October 1, 2024, Iran launched a series of drone and missile strikes against Israel, to
which Israel has responded. Most recently, on June 13, 2025, Israel launched a preemptive attack on Iran, to which Iran responded with
ballistic missile and drone attacks. On June 23, 2025, Israel and Iran agreed to a ceasefire, although there is no assurance that the
ceasefire will continue. On October 9, 2025, Israel, Hamas, the United States and other countries in the region agreed to a framework
for a ceasefire in Gaza between Israel and Hamas. How long and how severe the current conflicts in Gaza, Northern Israel, Lebanon, Iran
or the broader region become is unknown at this time and any continued clash among Israel, Hamas, Hezbollah, Iran or other countries or
militant groups in the region may escalate in the future into a greater regional conflict. To date, our operations have not been materially
affected, We expect that the current conflict in the Gaza Strip, Lebanon, Iran and the broader region, as well as the security escalation
in Israel, will not have a material impact on our business results in the short term. However, since these are events beyond our control,
their continuation or cessation may affect our expectations. We continue to monitor political and military developments closely and examine
the consequences for our operations and assets.

**NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES**

The financial statements are prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**A.** **Use of estimates in the preparation of financial statements** 

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, certain revenues and expenses, and disclosure of contingent assets and liabilities as of the date of the financial statements. As applicable to these financial statements, the most significant estimates and assumptions relate to revenue recognition.

In particular, revenue recognition includes estimates regarding the allocation of consideration among performance obligations and the recognition of development revenues based on the estimated resources expected to be invested in each year of the development period. These estimates and assumptions are based on management's best estimates and judgment. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment, which management believes to be reasonable under the circumstances. Actual results could differ from those estimates.

**TILTAN SOFTWARE ENGINEERING LTD.**

NOTES TO FINANCIAL STATEMENTS

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

**NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES (continue)**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**B.** **Functional currency** 

The functional currency of the Company is US Dollars ("USD"). Management believes that the USD is the currency in the primary economic environment in which the Company operates.

Transactions and balances originally denominated in dollars are presented at their original amounts. Balances in non- U.S. dollar currencies are translated into dollars using historical and current exchange rates for non-monetary and monetary balances, respectively. For non-dollar transactions and other items in the statements of operations (indicated below), the following exchange rates are used: (i) for transactions — exchange rates at transaction dates or average exchange rates; and (ii) for other items (derived from non-monetary balance sheet items such as depreciation and amortization) — historical exchange rates. Currency transaction gains and losses are presented in financial income or expenses, as appropriate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**D.** **Cash and cash equivalents** 

Cash equivalents are short-term highly liquid investments which include short term bank deposits (up to three months from date of deposit), that are not restricted as to withdrawals or use that are readily convertible to cash with maturities of three months or less as of the date acquired.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**E.** **Marketable Securities** 

The Company accounts for marketable equity securities in accordance with ASC Topic 321, "Investments – Equity Securities". Investments in marketable equity securities are recorded at fair value based on quoted market prices, with unrealized gains and losses, reported as financial income or expenses, as appropriate. These securities are a Level 1 fair value measurement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**F.** **Accounts Receivables** 

The Company manages credit risk associated with accounts receivables at the customer level.

Pursuant to Topic 326 for our accounts receivables, we maintain an allowance for doubtful accounts that reflects our estimate of our expected credit losses. Our allowance is estimated using a loss-rate model based on delinquency. The estimated loss rate is based on our historical experience with specific customers, our understanding of our current economic circumstances, reasonable and supportable forecasts, and our own judgment as to the likelihood of ultimate payment based upon available data.. The actual rate of future credit losses, however, may not be similar to past experience. Our estimate of doubtful accounts could change based on changing circumstances, including changes in the economy or in the particular circumstances of individual customers. Accordingly, we may be required to increase or decrease our allowance for doubtful accounts.

**TILTAN SOFTWARE ENGINEERING LTD.**

NOTES TO FINANCIAL STATEMENTS

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

**NOTE 2– SIGNIFICANT ACCOUNTING POLICIES (continue)**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**G.** **Property, plant and equipment, net** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is calculated
using the straight-line method over the estimated useful lives of the assets. When an asset is retired or otherwise disposed of, the related
cost and accumulated depreciation are removed from the respective accounts and the net difference less any amount realized from disposition
is reflected in the Statements of Operations and Comprehensive Loss.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Rates of depreciation:

---

| | |
|:---|:---|
|  | % |
| Furniture and office equipment | 7-15 |
| Computers | 33 |
| Vehicles | 15 |
| Leasehold improvements | (\*) |

---

(\*) Leasehold improvements are amortized on a straight-line basis over the shorter of the lease term (including the extension option held by the Group and intended to be exercised) and the expected life of the improvement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**H.** **Impairment of long-lived assets** 

The Company's long-lived assets are reviewed for impairment in accordance with ASC Topic 360, "Property, Plant and Equipment", whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the asset exceeds its fair value. No impairment expenses were recorded during the year ended December 31, 2024.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**I.** **Fair Value** 

Fair value of certain of the Company's financial instruments including cash, accounts payable, accrued expenses, long term loans from bank and other accrued liabilities approximate cost because of their short maturities. The Company measures and reports fair value in accordance with Accounting Standards Codification ("ASC") 820, "Fair Value Measurements" which defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles and expands disclosures about fair value measurements.

Fair value, as defined by ASC 820, is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value of an asset should reflect its highest and best use by market participants, principal (or most advantageous) markets, and an in-use or an in-exchange valuation premise.

**TILTAN SOFTWARE ENGINEERING LTD.**

NOTES TO FINANCIAL STATEMENTS

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

**NOTE 2– SIGNIFICANT ACCOUNTING POLICIES (continue)**

Valuation techniques are generally classified into three categories: (i) the market approach; (ii) the income approach; and (iii) the cost approach. The selection and application of one or more of the techniques may require significant judgment and are primarily dependent upon the characteristics of the asset or liability, and the quality and availability of inputs. Valuation techniques used to measure fair value under ASC 820 must maximize the use of observable inputs and minimize the use of unobservable inputs. ASC 820 also provides fair value hierarchy for inputs and resulting measurement as follows:

Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities.

Level 2: Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability; and inputs that are derived principally from or corroborated by observable market data for substantially the full term of the assets or liabilities; and

Level 3: Unobservable inputs for the asset or liability that are supported by little or no market activity, and that are significant to the fair values.

Fair value measurements are required to be disclosed by the level within the fair value hierarchy in which the fair value measurements in their entirety fall. Fair value measurements using significant unobservable inputs (in level 3 measurements) are subject to expanded disclosure requirements including a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (i) total gains or losses for the period (realized and unrealized), (ii) segregating those gains or losses included in earnings, and (iii) a description of where those gains or losses included in earning are reported in the statement of operations.

The Company's financial assets that are measured at fair value on a recurring basis by level within the fair value hierarchy are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Balance as of December 31, 2024** | **Balance as of December 31, 2024** | **Balance as of December 31, 2024** | **Balance as of December 31, 2024** |
|  | **Level 1** | **Level 2** | **Level 3** | **Total** |
|  | **US$ in thousands** | **US$ in thousands** | **US$ in thousands** | **US$ in thousands** |
| **Assets:** | | | | |
| Marketable securities | 252 |  |  | **252** |
| **Total assets** | **252** |  |  | **252** |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Balance as of December 31, 2023** | **Balance as of December 31, 2023** | **Balance as of December 31, 2023** | **Balance as of December 31, 2023** |
|  | **Level 1** | **Level 2** | **Level 3** | **Total** |
|  | **US$ in thousands** | **US$ in thousands** | **US$ in thousands** | **US$ in thousands** |
| **Assets:** | | | | |
| Marketable securities | 230 |  |  | **230** |
| **Total assets** | **230** |  |  | **230** |

---

**TILTAN SOFTWARE ENGINEERING LTD.**

NOTES TO FINANCIAL STATEMENTS

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

**NOTE 2– SIGNIFICANT ACCOUNTING POLICIES (continue)**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**J.** **Concentrations of credit risk** 

Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents as well as certain other current assets that do not amount to a significant amount. Cash and cash equivalents, which are primarily held in Dollars and New Israeli Shekels, are deposited with major banks in Israel. Management believes that such financial institutions are financially sound and, accordingly, minimal credit risk exists with respect to these financial instruments. The Company does not have any significant off-balance-sheet concentration of credit risk, such as foreign exchange contracts, option contracts or other foreign hedging arrangements.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**K.** **Contingencies** 

The Company records accruals for loss contingencies arising from claims, litigation and other sources when it is probable that a liability has been incurred and the amount can be reasonably estimated. These accruals are adjusted periodically as assessments change or additional information becomes available. Legal costs incurred in connection with loss contingencies are expensed as incurred.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**L.** **Leases** 

The Company determines if an arrangement is or contains a lease at contract inception.

Operating leases are included in operating lease right-of-use ("ROU") assets, other current liabilities, and operating lease liabilities in our balance sheets.

ROU assets represent the Company's right to use an underlying asset for the lease term and lease liabilities represent the Group's obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As the Company's leases do not provide an implicit rate, the Company generally uses the incremental borrowing rate based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at commencement date. The operating lease ROU asset also includes any lease payments made and excludes lease incentives. The Company's lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term.

The Company monitors for events or changes in circumstances that require a reassessment of one of its leases. When a reassessment results in the remeasurement of a lease liability, a corresponding adjustment is made to the carrying amount of the corresponding ROU asset unless doing so would reduce the carrying amount of the ROU asset to an amount less than zero. In that case, the amount of the adjustment that would result in a negative ROU asset balance is recorded in statement of comprehensive loss. For lease agreements, the Company has elected the practical expedient to account for the lease and non-lease maintenance components as a single lease component. Therefore, for those leases, the lease payments used to measure the lease liability include all of the fixed consideration in the contract.

**TILTAN SOFTWARE ENGINEERING LTD.**

NOTES TO FINANCIAL STATEMENTS

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

**NOTE 2– SIGNIFICANT ACCOUNTING POLICIES (continue)**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**M.** **Severance pay** 

All the Company's employees have been signed on Section 14 of Israel's Severance Compensation Law, 1963 ("Section 14"). Pursuant to Section 14, the Company's employees, covered by this section, are entitled only to monthly deposits, at a rate of 8.33% of their monthly salary, made on their behalf by the Company. Payments in accordance with Section 14 release the Company from any future severance liabilities in respect of those employees. Neither severance pay liability nor severance pay fund under Section 14 are recorded in the Company's balance sheets.

Severance expenses for the years ended December 31, 2024 and 2023 amounted to $87 and $75 respectively.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**N.** **Revenue recognition** 

The Company derives its revenues from two sources: (1) license fee and support revenues and (2) development services and other revenues.

The Company determine revenue recognition through the following steps: (1) identification of the contract with a customer; (2) identification of the performance obligations in the contract; (3) determination of the transaction price; (4) allocation of the transaction price to the performance obligations in the contract; and (5) recognition of revenue when, or as, we satisfy a performance obligation.

**License Fee and Support Revenues**

License fee and support revenues include software license revenues from the sales of term software licenses and support revenues from the sales of support and updates beyond the basic software license sales. These revenues are comprised of fees that provide customers with the right to use the Company's software during the term of the arrangement and related support and updates. Revenues from term software licenses are generally recognized at the point in time when the software is made available to the customer. Revenue from software support and updates is recognized as the support and updates are provided, which is generally ratably over the contract term.

**Development Services and Other Revenues**

 ****

Development services revenues include revenues from software development performed according to specific customer requirements. The Company's development service contracts may be based on time and materials or fixed price. These revenues are recognized based on progress toward completion, measured using management's estimates of the resources expected to be invested in each year of the development period. Revenues from time and materials contracts are recognized as the services are rendered, and for fixed price contracts, on a proportional performance basis. Other revenues consist primarily of training revenues recognized as such services are performed.

**TILTAN SOFTWARE ENGINEERING LTD.**

NOTES TO FINANCIAL STATEMENTS

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

**NOTE 2– SIGNIFICANT ACCOUNTING POLICIES (continue)**

**Significant Judgments – Contracts with Multiple Performance Obligations**

The Company enters into contracts with its customers that may include multiple performance obligations, such as software licenses, support and updates, and research and development services. A performance obligation is a promise in a contract to transfer goods or services that are determined to be distinct. Assessing whether goods and services are distinct and should be accounted for separately or combined as a single unit of account requires significant judgment.

Software licenses and support and update services are generally considered distinct, as these offerings are often sold separately. In assessing whether research and development services are distinct, the Company evaluates factors such as the availability of similar services from other vendors, the nature of the services, the timing of the service agreement relative to the license start date, and whether the service is contractually dependent on customer satisfaction with the work performed. To date, the Company has concluded that research and development services included in contracts with multiple performance obligations are distinct.

The Company allocates the transaction price to each performance obligation based on relative standalone selling price ("SSP"). SSP is the price at which the Company would sell a promised product or service separately to a customer. Determining SSP for each distinct performance obligation requires judgment. The Company establishes SSP considering its overall pricing objectives and market conditions, including discounting practices, historical and current sales prices, and contract terms. When the Company does not sell or price a product or service separately, it maximizes the use of observable inputs, such as market conditions. As the Company's go-to-market strategies evolve, pricing practices may change, which could result in changes to SSP. In certain cases, SSP is based on observable prices of products or services sold separately under comparable circumstances to similar customers. The Company uses a single amount to estimate SSP when supported by the distribution of observable prices.

For development services, the Company applies the Residual Approach to determine the standalone selling price, as the selling price of these services is uncertain.

**Costs to Obtain Revenue Contracts**

 ****

The Company capitalizes incremental costs of obtaining revenue contracts when such costs are expected to be recoverable. These costs primarily include sales commissions. Capitalized costs are amortized on a systematic basis over the estimated period of benefit, which reflects the expected contract term including anticipated renewals.

**TILTAN SOFTWARE ENGINEERING LTD.**

NOTES TO FINANCIAL STATEMENTS

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

**NOTE 2– SIGNIFICANT ACCOUNTING POLICIES (continue)**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**O.** **Income taxes** 

Income taxes are accounted for under the asset and liability method. The Company accounts for income taxes in accordance with ASC Topic 740, "Income Taxes". Accordingly, deferred income taxes are determined based on the estimated future tax effects of differences between the financial accounting and the tax bases of assets and liabilities under the applicable tax law. Deferred tax balances are computed using the enacted tax rates expected to be in effect when these differences reverse. Valuation allowances in respect of deferred tax assets are provided for, if necessary, to reduce deferred tax assets to amounts more likely than not to be realized.

The Company accounts for uncertain tax positions in accordance with ASC Topic 740-10, which prescribes detailed guidance for the financial statement recognition, measurement and disclosure of uncertain tax positions recognized in an enterprise's financial statements. According to ASC Topic 740-10, tax positions must meet a more-likely-than-not recognition threshold. The Company's accounting policy is to classify interest and penalties relating to uncertain tax positions under income taxes, however the Company did not recognize such items in its 2024 financial statements and did not recognize any liability with respect to an unrecognized tax position in its balance sheets.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**P.** **Research and development expenses** 

Research and development costs are expensed as incurred, and consist primarily of personnel, facilities, equipment, and supplies for research and development activities.

The Company follows the provisions of ASC 985, Accounting for the Costs of Computer Software to Be Sold, Leased, or Otherwise Marketed, which requires that software development costs incurred in conjunction with development be charged to research and development expenses until technological feasibility is established. The technological feasibility is established upon completion of a working model. The costs incurred by the Company between technological feasibility and general release to the public have been insignificant. Accordingly, all research and development costs have been expensed as incurred.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Q. **Comprehensive income** 

Comprehensive income includes no items other than net loss.

**TILTAN SOFTWARE ENGINEERING LTD.**

NOTES TO FINANCIAL STATEMENTS

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

**NOTE 2– SIGNIFICANT ACCOUNTING POLICIES (continue)**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**R.** **New Accounting Pronouncements** 

In June 2022, the FASB issued ASU 2022-03 ("ASU 2022-03"), ASC Subtopic 820 "Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions" ("ASC 820"). ASU 2022-03 amends ASC 820 to clarify that a contractual sales restriction is not considered in measuring an equity security at fair value and to introduce new disclosure requirements for equity securities subject to contractual sale restrictions that are measured at fair value. ASU 2022-03 applies to both holders and issuers of equity and Equity-Linked Securities measured at fair value. The amendments in ASU 2022-03 are effective for the Company in fiscal years beginning after December 15, 2024, and interim periods within those fiscal years. Early adoption is permitted for both interim and annual financial statements that have not yet been issued or made available for issuance. The Company adopted the ASU and it did not have a material impact on its financial statement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**S.** **Accounting Standards Not Yet Adopted** 

Income Taxes: In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The amendments in this ASU add specific requirements for income tax disclosures to improve transparency and decision usefulness. The guidance in ASU 2023-09 requires that public business entities disclose specific categories in the income tax rate reconciliation and provide additional qualitative information for reconciling items that meet a quantitative threshold. In addition, the amendments in ASU 2023-09 require that all entities disclose the amount of income taxes paid disaggregated by federal, state, and foreign taxes and disaggregated by individual jurisdictions. The ASU also includes other disclosure amendments related to the disaggregation of income tax expense between federal, state and foreign taxes. For public business entities, the amendments in this update are effective for annual periods beginning after December 15, 2025. Early adoption is permitted for annual financial statements that have not yet been issued or made available for issuance. The amendments in this update should be applied on a prospective basis and retrospective application is permitted. The Company is currently evaluating this ASU to determine its impact on the Company's disclosures.

In November 2024, the FASB issued ASU No. 2024-03 Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40). The ASU improves the disclosures about a public business entity's expense and provides more detailed information about the types of expenses in commonly presented expense captions. The amendments require that at each interim and annual reporting period an entity will, inter alia, disclose amounts of purchases of inventory, employee compensation, depreciation and amortization included in each relevant expense caption (such as cost of sales, SG&A and research and development). Amounts remaining in relevant expense captions that are not separately disclosed will be described qualitatively. Certain amounts that are already required to be disclosed under currently effective U.S GAAP will be included in the same disclosure as the other disaggregation requirements. The amendments also require disclosing the total amount of selling expenses and, in annual reporting periods, the definition of selling expenses. The ASU is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating this ASU to determine its impact on the Company's disclosures.

**TILTAN SOFTWARE ENGINEERING LTD.**

NOTES TO FINANCIAL STATEMENTS

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

**NOTE 2– SIGNIFICANT ACCOUNTING POLICIES (continue)**

In July 2025, the FASB issued ASU 2025-05 "Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets". The ASU introduces a practical expedient for all entities when estimating expected credit losses for current accounts receivable and current contract assets arising from transactions accounted for under ASC 606. Under the practical expedient, when developing reasonable and supportable forecast as part of estimating expected credit losses, an entity may assume that current conditions as of the balance sheet date do not change for the remining life of the asset. The ASU is effective for annual reporting period beginning after December 15, 2025 and interim reporting within those annual reporting periods. Early adoption is permitted in both interim and annual reporting periods. The Company is evaluating the impact of ASU 2025-05 on its consolidated financial statements if it elects to apply the practical expedient.

**NOTE 3 – LEASES**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. In January 2024 the Company exercised its final extension option of a lease agreement for the office space
in 2 Granit, Petach-Tikva, Israel for a term of two years. The quarterly lease payments under the lease agreement are approximately NIS
106 (approximately $29). The annual discount rate is 2.5%.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. The components of operating lease expense for the period ended December 31, 2024 and 2023 were as follows:

---

| | | |
|:---|:---|:---|
|  | **December 31,** | **December 31,** |
|  | **2024** | **2023** |
| <br>Operating lease expense | 157 | 145 |
| Weighted-average remaining lease term | 1 year | - |
| Weighted-average discount rate | 2.5% | 2.5% |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;C. Future minimum lease payments under non-cancellable leases as of December 31, 2024, are as follows:

---

| | |
|:---|:---|
| 2025 | 154 |
| 2026 | 10 |
| 2027 | - |
| Total operating lease payments | 164 |
| Less: imputed interest | (2) |
| Present value of lease liabilities | 162 |

---

**TILTAN SOFTWARE ENGINEERING LTD.**

NOTES TO FINANCIAL STATEMENTS

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

**NOTE 4 – OTHER CURRENT LIABILITIES**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **December 31,** | **December 31,** | **December 31,** | **December 31,** |
|  | **2024** | **2024** | **2023** | **2023** |
| Advances received from customer |  | 1227 |  |  |
| Employees and payroll accruals |  | 445 |  | 303 |
| Government Institutions |  | 391 |  | 297 |
| Accrued expenses | | 65 | | 137 |
|  | | **2,128** | | **737** |

---

**NOTE 5 – LONG TERM LOANS**

---

| | | |
|:---|:---|:---|
|  | **December 31,** | **December 31,** |
|  | **2024** | **2023** |
| Long term loans from bank (1) | 22 | 33 |
| Long-term loans from bank - current portion | (13) | (11) |
|  | **9** | **22** |

---

(1) Annual interest – Prime + 0.85%

Maturities of the loan from banks as of December 31, 2024, were as follows:

---

| | |
|:---|:---|
| **Year ended December 31,** | |
| 2025 | 13 |
| 2026 | 9 |
| Total | 22 |

---

**NOTE 6 – SHAREHOLDERS' EQUITY**

 ****

***Description of the rights attached to the Shares in the Company:***

**Common stock:**

The Ordinary shares confer upon their holders the right to participate and vote in the shareholders' meetings of the Company and the right to participate in any distribution of dividends.

**Dividend Declared**

During 2024, the Company's Board of Directors approved the distribution of a cash dividend in the amount of NIS13.4 million (equivalent to approximately USD 4.8 million), payable to shareholders of record as of December 31, 2024

The dividend was declared and paid during 2024 and was presented as a reduction of retained earnings in the statement of changes in equity.

**TILTAN SOFTWARE ENGINEERING LTD.**

NOTES TO FINANCIAL STATEMENTS

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

**NOTE 7 – REVENUES**

***Disaggregation of Revenue***

*Development and Support Services:*

 ****

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Year ended 2024** | **Year ended 2024** | **December 31<br> 2023** | **December 31<br> 2023** |
| Support Services |  | 1142 |  | 2285 |
| Development Services | | 1,822 | | 2,110 |
|  | | 2,964 | | 4,395 |

---

 ****

*Major customers:*

 

Costumer A contributed 85% and 87% of the Company's total revenues in 2024 and 2023 respectively. Costumer B contributed 11% and 8% of the Company's total revenues in 2024 and 2023 respectively.

No other customer contributed 10% or more of the Company's revenues in 2024 and 2023.

*Geographic information:*

 

The revenues reported in the financial statements are based on the location of the customers, as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Year ended December 31** | **Year ended December 31** | **Year ended December 31** | **Year ended December 31** |
|  | **2024** | **2024** | **2023** | **2023** |
| China |  | 2513 |  | 3808 |
| Israel and rest of the world | | 451 | | 587 |
|  | | 2,964 | | 4,395 |

---

**Contract Balances**

 ****

*Contract Assets*

 

The Company records a contract asset when revenue recognized on a contract exceeds the billings. Contract assets were $22 thousands as of December 31, 2024 as compared to $65 thousands as of December 31, 2023, and are included in other current assets and other assets on the consolidated balance sheets.

 

*Contract Liabilities*

 

The Company records contract liabilities when the costumer has been billed in advance of the Company completing its performance obligation.

These amounts are recorded as deferred revenue in the Consolidated Balance Sheets.

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Year ended December 31** | **Year ended December 31** | **Year ended December 31** | **Year ended December 31** |
|  | **2024** | **2024** | **2023** | **2023** |
| Beginning of year | **-** | **-** | - | - |
| Deferral of revenue |  | **1,227** |  |  |
| Recognition of deferred revenue | | **-** | | - |
| Balance at end of year | | **1,227** | | - |

---

**TILTAN SOFTWARE ENGINEERING LTD.**

NOTES TO FINANCIAL STATEMENTS

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

**NOTE 7 – REVENUES (continue)**

***Remaining Performance Obligation***

Remaining performance obligation represents contracted revenue that has not yet been recognized and includes unearned revenue and unbilled amounts that will be recognized as revenue in future periods. Remaining performance obligation is subject to future economic risks, including bankruptcies, regulatory changes and other market factors.

The majority of the Company's noncurrent remaining performance obligation is expected to be recognized in the next 12 to 24 months.

---

| | | | |
|:---|:---|:---|:---|
|  | **Current** | **Noncurrent** | **Total** |
| As of December 31, 2024 | 1295 |  | 1295 |
| As of December 31, 2023 | 2513 | 1295 | 3808 |

---

**NOTE 8 – COST OF REVENUES**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Year ended December 31** | **Year ended December 31** | **Year ended December 31** | **Year ended December 31** |
|  | **2024** | **2024** | **2023** | **2023** |
| Salaries and related expenses |  | 439 |  | 396 |
| Lease expenses |  | 71 |  | 46 |
| Other expenses | | 52 | | 95 |
|  | | 562 | | 537 |

---

**NOTE 9 – REASERCH AND DEVELOPMENT EXPENSES**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Year ended December 31** | **Year ended December 31** | **Year ended December 31** | **Year ended December 31** |
|  | **2024** | **2024** | **2023** | **2023** |
| Salaries and related expenses |  | 839 |  | 769 |
| Lease expenses |  | 47 |  | 57 |
| Professional services |  | 172 |  | 105 |
| Other expenses | | 107 | | 94 |
|  | | 1,165 | | 1,025 |

---

**NOTE 10 – GENERAL AND ADMINISTRATIVE EXPENSES**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Year ended December 31** | **Year ended December 31** | **Year ended December 31** | **Year ended December 31** |
|  | **2024** | **2024** | **2023** | **2023** |
| Salaries and related expenses |  | 287 |  | 236 |
| Lease expenses |  | 39 |  | 42 |
| Allowance for doubtful accounts |  |  |  | 58 |
| Other expenses | | 78 | | 96 |
|  | | 404 | | 432 |

---

**TILTAN SOFTWARE ENGINEERING LTD.**

NOTES TO FINANCIAL STATEMENTS

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

**NOTE 11 – INCOME TAX**

In April 2022, the Company obtained a tax ruling from the Israel Tax Authority confirming that it qualifies as a Preferred Technological Enterprise under Section 51 of the Encouragement of Capital Investments Law, 1959 (the "Law"). The tax rate is 12%.

The ruling is effective for the fiscal years 2021 through 2025, provided there is no material change in the Company's business activities or operating model. Should the Company fail to meet the statutory or ruling conditions, the tax benefits withdrawn retroactively.

Management believes that as of the balance sheet date, the Company continues to comply with all the conditions set forth in the Law and the ruling, and accordingly, the financial statements reflect the Company's entitlement to the reduced corporate tax rates associated with its status as a Preferred Technological Enterprise.

The Company have received final tax assessments for the years ended by December 31, 2022.

The following is reconciliation between the theoretical tax on pre-tax income, at the tax rate applicable to the Company (federal tax rate) and the tax expense reported in the financial statements:

---

| | | |
|:---|:---|:---|
|  | **Year ended December 31** | **Year ended December 31** |
|  | **2024** | **2023** |
| Pretax income | 941 | 2253 |
| Statutory tax rate in Israel | 23% | 23% |
| Income tax computed at the ordinary tax rate | 216 | 518 |
| Exchange rate differences | 7 | 13 |
| Tax benefits arising from reduced tax rates | (104) | (248) |
|  | 119 | 283 |

---

**Deferred income taxes:**

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company's deferred tax assets are as follows:

---

| | | |
|:---|:---|:---|
|  | **Year ended **December 31,** | **Year ended **December 31,** |
|  | **2024** | **2023** |
| <u>Deferred tax assets</u> |  |  |
| Research and development expenses | 136 | 129 |
| Employees accruals | 32 | 24 |
| Operating lease right-of-use asset | 20 | 11 |
| Allowance for doubtful accounts | 7 | 7 |
| Gross deferred tax assets | 195 | 171 |
| <u>Deferred tax liabilities</u> |  |  |
| Operating lease liabilities | (20) | (11) |
| &nbsp;&nbsp;&nbsp;Valuation allowance | - | - |
| Total deferred tax assets, net | 175 | 160 |

---

**TILTAN SOFTWARE ENGINEERING LTD.**

NOTES TO FINANCIAL STATEMENTS

(U.S. dollars, except share and per share data)

**NOTE 12 – RELATED PARTIES**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**A.** **Transactions and balances with related parties** 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Year ended December 31** | **Year ended December 31** | **Year ended December 31** | **Year ended December 31** |
|  | **2024** | **2024** | **2023** | **2023** |
| **Financing:** | | | | |
| &nbsp;&nbsp;&nbsp;Financing income (imputed interest) | | - | | 3 |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**B.** **Balances with related parties:** 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **As of December 31,** | **As of December 31,** | **As of December 31,** | **As of December 31,** |
|  | **2024** | **2024** | **2023** | **2023** |
| Other current assets | | 19 | | 96 |

---

## Exhibit 99.2

**Exhibit 99.2**

**TILTAN SOFTWARE ENGINEERING LTD.** 

<br> CONDENSED FINANCIAL STATEMENTS

AS OF SEPTEMBER 30, 2025

**TILTAN SOFTWARE ENGINEERING LTD.**

INTERIM UNAUDITED CONDENSED FINANCIAL STATEMENTS

AS OF SEPTEMBER 30, 2025

U.S. DOLLARS IN THOUSANDS

**TABLE OF CONTENTS**

---

| | |
|:---|:---|
|  | **Page** |
| **CONDENSED FINANCIAL STATEMENTS** (unaudited)**:** |  |
| &nbsp;&nbsp;&nbsp;[Interim unaudited condensed balance sheets](#a_001) | 3 |
| &nbsp;&nbsp;&nbsp;[Interim unaudited condensed statements of comprehensive income (loss)](#a_002) | 4 |
| &nbsp;&nbsp;&nbsp;[Interim unaudited condensed statements of stockholders' equity](#a_003) | 5 |
| &nbsp;&nbsp;&nbsp;[Interim unaudited condensed statements of cash flows](#a_004) | 6 |
| &nbsp;&nbsp;&nbsp;[Notes to interim unaudited condensed financial statements](#a_005) | 7-13 |

---

![](ex99-2_001.jpg)

**TILTAN SOFTWARE ENGINEERING LTD.**

INTERIM UNAUDITED CONDENSED BALANCE SHEETS

(U.S. dollars in thousands, except share and per share data)

---

| | | |
|:---|:---|:---|
|  | **September 30, <br> 2025** | **December 31, <br> 2024** |
| **Assets** | | |
| **Current Assets** | | |
| &nbsp;&nbsp;&nbsp;Cash and cash equivalents | 790 | 2532 |
| &nbsp;&nbsp;&nbsp;Short term bank deposit | 19 | 17 |
| &nbsp;&nbsp;&nbsp;Marketable securities | 277 | 252 |
| &nbsp;&nbsp;&nbsp;Accounts receivable**,** less allowance for credit losses of $58 as of December 31, 2024 and $27 as of September 30, 2025 | 243 | 164 |
| &nbsp;&nbsp;&nbsp;Other current assets – related party (Note 6) | 21 | 19 |
| &nbsp;&nbsp;&nbsp;Other current assets | 222 | 48 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total Current Assets** | **1572** | **3032** |
| **Deferred taxes** (Note 5) | **119** | **175** |
| **Operating lease right-of-use asset** | **48** | **161** |
| **Other intangible assets** | **473** | **-** |
| **Property and equipment, net** | **64** | **49** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total Assets** | **2276** | **3417** |
| **Liabilities and Shareholders' Equity** |  |  |
| **Current Liabilities** |  |  |
| &nbsp;&nbsp;&nbsp;Current portion of long- term loans from bank | 13 | 13 |
| &nbsp;&nbsp;&nbsp;Accounts payable | 32 | 31 |
| &nbsp;&nbsp;&nbsp;Operating lease liability | 46 | 152 |
| &nbsp;&nbsp;&nbsp;Other current liabilities (Note 3) | 706 | 2128 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total current liabilities** | 797 | 2324 |
| **Long term loans from Banks** | 2 | 9 |
| **Operating lease liability** | - | 10 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total Liabilities** | **799** | **2343** |
| **Stockholders' Equity** |  |  |
| &nbsp;&nbsp;&nbsp;Common stock of NIS 1par value each ("Common Stock"): <br> 10,000 shares authorized as of September 30, 2025 and December 31, 2024; issued and outstanding 100 shares as of September 30, 2025 and December 31, 2024 | <br> (\*) | <br> (\*) |
| Retained earnings | 1477 | 1074 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total Stockholders' Equity** | 1477 | 1074 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total liabilities and stockholders' Equity** | **2276** | **3417** |

---

---

| | |
|:---|:---|
| (\*) | represents amount less than $1 thousand. |

---

**The accompanying notes are an integral part of these interim unaudited condensed financial statements.**

**TILTAN SOFTWARE ENGINEERING LTD.**

INTERIM UNAUDITED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME

(U.S. dollars in thousands, except share and per share data)

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the<br> Nine-month <br> period<br> ended<br> September 30,**<br>**2025** | **For the<br> Nine-month<br> period<br> ended<br> September 30,**<br>**2024** | **For the<br> Three-<br> month<br> period<br> ended<br> September 30,**<br>**2025** | **For the<br> Three-<br> month<br> period<br> ended<br> September 30,**<br>**2024** |
| Revenues)Note 4) | 1639 | 2149 | 452 | 493 |
| Cost of revenues | (552) | (394) | (203) | (129) |
| &nbsp;&nbsp;&nbsp;**Gross profit** | 1087 | 1755 | 249 | 364 |
| Research and developments expenses | (470) | (856) | (147) | (272) |
| Selling general and administrative expenses | (268) | (354) | (68) | (61) |
| &nbsp;&nbsp;&nbsp;**Operating income** | 349 | 545 | 34 | 31 |
| Financial income (expenses), net | 88 | 54 | (130) | (24) |
| &nbsp;&nbsp;&nbsp;**Income (loss) before tax** | 437 | 599 | (96) | 7 |
| Income tax (Note 5) | (34) | (83) | 3 | 7 |
| &nbsp;&nbsp;&nbsp;**Net income (loss)** | **403** | **516** | **(93)** | **14** |

---

**The accompanying notes are an integral part of these interim unaudited condensed financial statements.**

**TILTAN SOFTWARE ENGINEERING LTD.** 

INTERIM UNAUDITED CONDENSED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY

(U.S. dollars in thousands, except share and per share data)

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Number of<br> Shares** | **Amount** | **Additional<br> paid-in<br> capital** | **Retained<br> earnings** | **Total<br> stockholders'<br> equity** |
| **BALANCE AT DECEMBER 31, 2023** | **100** | **(\***)** |  | **5014** | **5014** |
| &nbsp;&nbsp;&nbsp;Declared and Paid Dividend: | **-** |  |  | (4762) | **(4762)** |
| Common shares $47,620/share |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Total comprehensive income for the year | **-** | - |  | 822 | **822** |
| **BALANCE AT DECEMBER 31, 2024** | **100** | **(\*)** |  | **1074** | **1074** |
| &nbsp;&nbsp;&nbsp;**Total comprehensive income for the year** | **-** | **-** |  | **403** | **403** |
| **BALANCE AT SEPTEMBER 30, 2025** | **100** | **(\*)** |  | **1477** | **1477** |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Number of <br> Shares** | **Amount** | **Additional<br> paid-in<br> capital** | **Retained <br>earnings** | **Total <br>stockholders'<br> equity** |
| **BALANCE AT JULY 1, 2025** | **100** | **(\*)** |  | **1570** | **1570** |
| &nbsp;&nbsp;&nbsp;Total comprehensive loss for the year | - | - |  | (93) | **(93)** |
| **BALANCE AT SEPTEMBER 30, 2025** | **100** | **(\*)** |  | **1477** | **1477** |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Number of <br> Shares** | **Amount** | **Additional<br> paid-in<br> capital** | **Retained<br> earnings** | **Total<br> stockholdes'<br> equity** |
| **BALANCE AT DECEMBER 31, 2023** | **100** | **(\*)** |  | **5014** | **5014** |
| &nbsp;&nbsp;&nbsp;Declared and Paid Dividend: | **-** |  |  | (2025) | **(2025)** |
| Common shares $20,250/share |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Total comprehensive income for the year | **-** | - |  | 516 | **516** |
| **BALANCE AT SEPTEMBER 30, 2024** | **100** | **(\*)** |  | **3505** | 3505 |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Number of<br> Shares** | **Amount** | **Additional<br> paid-in<br> capital** | **Retained<br> earnings** | **Total<br> stockholders'**<br> **equity** |
| **BALANCE AT JULY 1, 2024** | **100** | **(\*)** |  | **4538** | **4538** |
| &nbsp;&nbsp;&nbsp;Declared and Paid Dividend: | **-** |  |  |  |  |
| Common shares $10,470/share |  |  |  | (1047) | **(1047)** |
| &nbsp;&nbsp;&nbsp;Total comprehensive income for the year | **-** | - |  | 14 | **14** |
| **BALANCE AT SEPTEMBER 30, 2024** | **100** | **(\*)** |  | **3505** | **3505** |

---

---

| | |
|:---|:---|
| (\*) | represents amount less than $1 thousand |

---

**The accompanying notes are an integral part of these interim unaudited condensed financial statements.**

**TILTAN SOFTWARE ENGINEERING LTD.**

INTERIM UNAUDITED CONDENSED STATEMENTS OF CASH FLOWS

(U.S. dollars in thousands)

---

| | | |
|:---|:---|:---|
|  | **For the** | **For the** |
|  | **Nine-month period ended** | **Nine-month period ended** |
|  | **September 30,** | **September 30,** |
|  | **2025** | **2024** |
| **CASH FLOWS FROM OPERATING ACTIVITIES:** |  |  |
| &nbsp;&nbsp;&nbsp;Total comprehensive income for the period | 403 | 516 |
| &nbsp;&nbsp;&nbsp;**Adjustments required to reconcile net loss for the period to net cash used in operating activities:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation | 6 | 2 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Change in the fair value of securities | (25) | 4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Change in right of use asset | 113 | 120 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Change in lease liability | (116) | (125) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred taxes | 56 | (16) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Decrease (increase) in accounts receivable | (79) | 1399 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Decrease (increase) in other current assets | (177) | 126 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Increase in accounts payable | 1 | 11 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Increase (decrease) in other liabilities | (1421) | 956 |
| &nbsp;&nbsp;&nbsp;Net cash provided by (used in) operating activities | (1239) | 2993 |
| **CASH FLOWS FROM INVESTING ACTIVITIES:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Purchase of property and equipment | (21) | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Increase in other intangible assets | (473) | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Increase in short term bank deposit | (2) | (17) |
| Net cash used in investment activities | (496) | (17) |
| **CASH FLOWS FROM FINANCING ACTIVITIES:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Repayment of loans from banking institutions | (7) | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Payment of dividend | **-** | (2025) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Increase in related party |  | (2090) |
| Net cash used in financing activities | (7) | (4115) |
| **INCREASE IN CASH AND CASH EQUIVALENTS** |  |  |
| &nbsp;&nbsp;&nbsp;Decrease in Cash and Cash Equivalents | (1742) | (1139) |
| **CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD** | 2532 | 3691 |
| **CASH AND CASH EQUIVALENTS AT END OF PERIOD** | 790 | 2552 |
| **Supplemental disclosure of cash flow information:** |  |  |
| **Non cash transactions:** |  |  |
| **Initial recognition of operating lease right-of-use assets and liabilities** |  | 230 |
| **Cash transactions:** |  |  |
| Interest | 1 | 1 |
| Taxes | 96 | 310 |

---

**The accompanying notes are an integral part of these interim unaudited condensed financial statements.**

**TILTAN SOFTWARE ENGINEERING LTD.**

NOTES TO INTERIM UNAUDITED CONDENSED FINANCIAL STATEMENTS

**NOTE 1 – GENERAL**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. Tiltan Software Engineering Ltd. (hereinafter: "Company", "us", "our"
or "we") was incorporated in 2015. The Company develops advanced simulation and geo-spatial intelligence technologies that
reduce costs, accelerate development, and ensure operational reliability. The company delivers synthetic data tools that train AI systems,
autonomous navigation solutions for aircraft and drones, high-resolution geo-mapping platforms for turning airborne and spaceborne imagery
into actionable insights, and simulation environments that support defense, aerospace, and commercial applications.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. On October 7, 2023, Hamas launched a series of attacks on civilian and military targets in Southern Israel
and Central Israel, to which the Israel Defense Forces have responded. In addition, both Hezbollah and the Houthi movement have attacked
military and civilian targets in Israel, to which Israel has responded, including through increased air and ground operations in Lebanon.
In addition, the Houthi movement has attacked international shipping lanes in the Red Sea, to which both Israel and the United States
have responded. Further, on April 13, 2024 and October 1, 2024, Iran launched a series of drone and missile strikes against Israel, to
which Israel has responded. Most recently, on June 13, 2025, Israel launched a preemptive attack on Iran, to which Iran responded with
ballistic missile and drone attacks. On June 23, 2025, Israel and Iran agreed to a ceasefire, although there is no assurance that the
ceasefire will continue. On October 9, 2025, Israel, Hamas, the United States and other countries in the region agreed to a framework
for a ceasefire in Gaza between Israel and Hamas. How long and how severe the current conflicts in Gaza, Northern Israel, Lebanon, Iran
or the broader region become is unknown at this time and any continued clash among Israel, Hamas, Hezbollah, Iran or other countries or
militant groups in the region may escalate in the future into a greater regional conflict. To date, our operations have not been materially
affected, We expect that the current conflict in the Gaza Strip, Lebanon, Iran and the broader region, as well as the security escalation
in Israel, will not have a material impact on our business results in the short term. However, since these are events beyond our control,
their continuation or cessation may affect our expectations. We continue to monitor political and military developments closely and examine
the consequences for our operations and assets.

**TILTAN SOFTWARE ENGINEERING LTD.**

NOTES TO THE INTERIM UNAUDITED CONDENSED FINANCIAL STATEMENTS (unaudited)

**NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND BASIS OF PRESENTATION**

**Unaudited Interim Financial Statements**

The accompanying condensed interim balance sheet as of September 30, 2025 and the condensed interim statements of operations, changes in shareholders' equity and cash flows for the nine and three-month period ended September 30, 2025 are unaudited. These unaudited condensed interim financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America.

The unaudited condensed interim financial statements contain all adjustments which, in the opinion of management, are necessary to present fairly, the financial information included therein. It is suggested that these condensed interim financial statements be read in conjunction with the audited financial statements and accompanying notes included in the Company's report for the year ended December 31, 2024. Results for the interim periods presented are not necessarily indicative of the results to be expected for the full year.

These financial statements should be read in conjunction with the financial statements and notes thereto contained in the Company's Annual Report for the year ended December 31, 2024.

**Research and Development Costs**

Research and development ("R&D") costs are accounted for in accordance with ASC 730, Research and Development. R&D costs are expensed as incurred and include, among other things, payroll and related costs for employees engaged in research and development activities, external consulting services, materials, prototype development, testing activities, and other directly attributable costs.

Software development costs incurred prior to the establishment of technological feasibility of a software, as well as costs incurred after general release of software products (including routine maintenance, bug fixes, and minor enhancements), are expensed as incurred.

The Company accounts for software development costs related to software products developed for sale, lease, or marketing in accordance with ASC 985-20, Costs of Software to Be Sold, Leased, or Marketed.

The Company employs a structured development methodology consisting of sequential stages, including requirements and specifications definition, software architecture and design, and detailed module-level design. In most cases, Agile development practices are only applied at the module development stage, following completion and formal approval of the overall software design.

Technological feasibility is generally determined based on the completion and approval of detail program design documentation together with the successful validation of an internal working model demonstrating that the software product can be produced to meet its design specifications. Accordingly, technological feasibility is generally achieved prior to a working model ready for customer testing.

In accordance with ASC 985-20-25-1 through 25-6, all software development costs incurred prior to the establishment of technological feasibility are expensed as research and development costs.

**TILTAN SOFTWARE ENGINEERING LTD.**

NOTES TO THE INTERIM UNAUDITED CONDENSED FINANCIAL STATEMENTS (unaudited)

**NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND BASIS OF PRESENTATION**

Once technological feasibility has been established, the Company capitalizes eligible software development costs incurred until the related product or functionality is available for general release to customers. Capitalized costs include:

● Direct labor costs related to coding, configuration, integration, and testing;

● Payroll-related costs and employee benefits directly attributable to development personnel;

● Costs of external consultants and contractors directly engaged in development activities; and

● Other direct development costs that are clearly identifiable and directly attributable to qualifying post-feasibility development activities.

Capitalization is applied on a project-by-project basis and commences only when qualifying post-feasibility production activities begin. Capitalization does not occur uniformly across all projects or periods.

The Company capitalizes only those development costs that can be clearly identified as qualifying production-stage activities and that are supported by contemporaneous and verifiable documentation, including detailed engineering timesheets and monthly project-level hour tracking.

Capitalization ceases when the software product or the related substantive enhancement is available for general release to customers, as defined in ASC 985-20-25-6.

Development activities related to existing software products are evaluated to determine whether they constitute routine maintenance or minor enhancements, which are expensed as incurred, or substantive new functionality and material architectural enhancements.

Development programs that constitute product enhancements are evaluated in accordance with ASC 985-20, which defines enhancements as improvements to an existing software product that are intended to extend the useful life of the product or significantly improve its marketability**.** Once technological feasibility for such enhancements is established, qualifying post-feasibility development costs are capitalized in accordance with the policy described above.

**TILTAN SOFTWARE ENGINEERING LTD.**

NOTES TO THE INTERIM UNAUDITED CONDENSED FINANCIAL STATEMENTS (unaudited)

**NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND BASIS OF PRESENTATION**

**Use of Estimates**

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, certain revenues and expenses, and disclosure of contingent assets and liabilities as of the date of the financial statements. As applicable to these financial statements, the most significant estimates and assumptions relate to revenue recognition.

In particular, revenue recognition includes estimates regarding the allocation of consideration among performance obligations and the recognition of development revenues based on the estimated resources expected to be invested in each year of the development period. These estimates and assumptions are based on management's best estimates and judgment. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment, which management believes to be reasonable under the circumstances. Actual results could differ from those estimates.

**New Accounting Pronouncements**

In December 2025, the FASB issued ASU 2025-11 "Interim Reporting (Topic 270): Narrow-Scope Improvements." The ASU clarifies the applicability of interim reporting guidance under U.S. GAAP, provides a comprehensive list of interim disclosure requirements within Topic 270, and introduces a disclosure principle requiring entities to provide information about events and changes occurring after the end of the most recent annual reporting period that have a material impact on the entity. The ASU does not change the fundamental nature of interim reporting or expand or reduce existing interim disclosure requirements. ASU 2025-11 is effective for interim reporting periods within annual reporting periods beginning after December 15, 2027 for public business entities and after December 15, 2028 for all other entities, with early adoption permitted. The Company is currently evaluating the impact of ASU 2025-11 on its interim financial reporting and related disclosures.

**NOTE 3 – OTHER CURRENT LIABILITIES**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **September 30,<br> 2025** | **September 30,<br> 2025** | **December 31,<br> 2024** | **December 31,<br> 2024** |
| Advances received from customer |  | 278 |  | 1227 |
| Employees and payroll accruals |  | 425 |  | 445 |
| Government Institutions |  | 3 |  | 391 |
| Accrued expenses | | - | | 65 |
|  | | **706** | | **2,128** |

---

**TILTAN SOFTWARE ENGINEERING LTD.**

NOTES TO THE INTERIM UNAUDITED CONDENSED FINANCIAL STATEMENTS (unaudited)

**NOTE 4 – REVENUES**

*Disaggregation of Revenue*

 

*Development and Support Services**:***

 ****

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the<br> **Nine-month<br> period<br> ended<br> September 30,**<br>**2025** | **For the<br> Nine-month<br> period<br> ended<br> September 30,**<br>**2024** | **For the<br> Three- <br> month <br> period <br> ended<br> September 30,**<br>**2025** | **For the<br> Three- <br> month <br> period<br> ended September 30,**<br>**2024** |
| Support Services | 856 | 856 | 286 | 286 |
| Development Services | 783 | 1293 | 166 | 207 |
|  | 1639 | 2149 | 452 | 493 |

---

*Major customers:*

 

Costumer A contributed 77% and 86% of the Company's total revenues for the nine month period ended September 30, 2025 and 2024, respectively. Costumer B contributed 18% and 12% of the Company's total revenues for the nine month period ended September 30, 2025 and 2024, respectively.

No other customer contributed 10% or more of the Company's revenues for the nine month period ended September 30, 2025 and 2024.

 

*Geographic information:*

 

The revenues reported in the financial statements are based on the location of the customers, as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the<br> Nine-month<br> period<br> ended September 30,**<br>**2025** | **For the<br> Nine-month<br> period <br> ended<br> September 30,**<br>**2024** | **For the <br> Three-<br> month<br> period <br> ended <br> September 30,**<br>**2025** | **For the <br> Three- <br> month<br> period <br> ended<br> September 30,**<br>**2024** |
| China | 1009 | 1844 | 286 | 407 |
| Israel and rest of the world | 630 | 305 | 166 | 86 |
|  | 1639 | 2149 | 452 | 493 |

---

***Contract Balances***

 ****

*Contract Assets*

 

The Company records a contract asset when revenue recognized on a contract exceeds the billings. Contract assets were $22 thousands as of December 31, 2024 as compared to $5 thousands as of September 30, 2025, and are included in other current assets and other assets on the balance sheets.

**TILTAN SOFTWARE ENGINEERING LTD.**

NOTES TO THE INTERIM UNAUDITED CONDENSED FINANCIAL STATEMENTS (unaudited)

**NOTE 4 – REVENUES**

 

*Contract Liabilities*

 

The Company records contract liabilities when the costumer has been billed in advance of the Company completing its performance obligation.

These amounts are recorded as deferred revenue in the Balance Sheets.

---

| | | |
|:---|:---|:---|
|  | **Period ended<br> September 30,**<br>**2025** | **Year ended<br> December 31**<br>**2024** |
| Beginning of year | **1227** | **-** |
| Deferral of revenue | **-** | **1227** |
| Recognition of deferred revenue | **(941)** | **-** |
| Balance at end of period | **286** | **1227** |

---

***Remaining Performance Obligation***

Remaining performance obligation represents contracted revenue that has not yet been recognized and includes unearned revenue and unbilled amounts that will be recognized as revenue in future periods. Remaining performance obligation is subject to future economic risks, including bankruptcies, regulatory changes and other market factors.

The majority of the Company's noncurrent remaining performance obligation is expected to be recognized in the next 12 to 24 months.

---

| | | | |
|:---|:---|:---|:---|
|  | **Current** | **Noncurrent** | **Total** |
| As of September 30, 2025 | 286 |  | 286 |
| As of December 31, 2024 | 1295 |  | 1295 |

---

**NOTE 5 – INCOME TAX**

In April 2022, the Company obtained a tax ruling from the Israel Tax Authority confirming that it qualifies as a Preferred Technological Enterprise under Section 51 of the Encouragement of Capital Investments Law, 1959 (the "Law"). The tax rate is 12%.

The ruling is effective for the fiscal years 2021 through 2025, provided there is no material change in the Company's business activities or operating model. Should the Company fail to meet the statutory or ruling conditions, the tax benefits withdrawn retroactively.

Management believes that as of the balance sheet date, the Company continues to comply with all the conditions set forth in the Law and the ruling, and accordingly, the financial statements reflect the Company's entitlement to the reduced corporate tax rates associated with its status as a Preferred Technological Enterprise.

The Company have received final tax assessments for the years ended by December 31, 2022.

**TILTAN SOFTWARE ENGINEERING LTD.**

NOTES TO THE INTERIM UNAUDITED CONDENSED FINANCIAL STATEMENTS (unaudited)

**NOTE 5 – INCOME TAX**

The following is reconciliation between the theoretical tax on pre-tax income, at the tax rate applicable to the Company (federal tax rate) and the tax expense reported in the financial statements:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the nine-month<br> period ended <br> September 30,** | **For the nine-month<br> period ended <br> September 30,** | **For the Three-month<br> period ended<br> September 30,** | **For the Three-month<br> period ended<br> September 30,** |
|  | **2025** | **2024** | **2025** | **2024** |
| Pretax income (loss) | 437 | 599 | (96) | 7 |
| Statutory tax rate in Israel | 23% | 23% | 23% | 23% |
| Income tax computed at the ordinary tax rate | 100 | 138 | (22) | 2 |
| Exchange rate differences | (18) | 11 | 8 | (8) |
| Tax benefits arising from reduced tax rates | (48) | (66) | 11 | (1) |
|  | 34 | 83 | (3) | (7) |

---

**Deferred income taxes:**

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company's deferred tax assets are as follows:

---

| | | |
|:---|:---|:---|
|  | **Period ended<br> September 30,**<br>**2025** | **Year ended<br> December 31,**<br>**2024** |
| <u><u>Deferred tax assets</u></u> |  |  |
| Research and development expenses | 77 | 136 |
| Employees accruals | 39 | 32 |
| Operating lease right-of-use asset | 6 | 20 |
| Allowance for doubtful accounts | 3 | 7 |
| Gross deferred tax assets | 125 | 195 |
| <u>Deferred tax liabilities</u> |  |  |
| Operating lease liabilities | (6) | (20) |
| &nbsp;&nbsp;&nbsp;Valuation allowance | - | - |
| Total deferred tax assets, net | 119 | 175 |

---

**NOTE 6 – RELATED PARTIES**

**Balances with related parties:**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **As of<br> September 30,** | **As of<br> September 30,** | **As of<br> December 31,** | **As of<br> December 31,** |
|  | **2025** | **2025** | **2024** | **2024** |
| Other current assets | | 21 | | 19 |

---

## Exhibit 99.3

**Exhibit 99.3**

**Nukkleus Completes Tiltan Acquisition, Adds 30 Years of Defense AI Leadership to Portfolio**

 

*Israeli defense technology pioneer, supplier to IAI, Elbit, and Rafael, now a wholly owned Nukkleus subsidiary*

**NEW YORK and TEL AVIV, Israel, December 30, 2025 —** Nukkleus Inc. (NASDAQ: NUKK), (the "Company"), a strategic acquirer and developer of high-growth aerospace and defense businesses, today announced the closing of its acquisition of Tiltan Software Engineering Ltd. ("Tiltan"), a 30-year leader in defense AI simulation, synthetic data generation, and GPS-denied navigation systems. Tiltan is now a wholly owned subsidiary of the Company.

Tiltan's technology is embedded in some of the world's most advanced defense programs. Tiltan's simulation platforms train pilots and operators for Israel Aerospace Industries, its synthetic data accelerates machine learning development for Elbit Systems, and its GPS-denied navigation systems enable Rafael Advanced Defense Systems platforms to operate in contested electromagnetic environments. The Israeli Ministry of Defense has recognized Tiltan with multiple innovation and excellence awards over its three-decade history.

The acquisition gives Nukkleus a strong position in defense technology's fastest-growing segments. The defense AI market is expected to grow from $28 billion to $65.5 billion by 2034. The military simulation market will exceed $21 billion by 2030. And as GPS jamming reshapes modern warfare, from Ukraine to the Baltic, demand for Tiltan's navigation solutions is accelerating rapidly.

"Tiltan doesn't just participate in these markets, it helps define them," said Menny Shalom, CEO of Nukkleus. "For 30 years, when Israel's top defense contractors needed simulation that worked, synthetic data they could trust, or navigation systems that function when GPS doesn't, they called Tiltan. That reputation isn't for sale at any price, but it is exactly what we acquired today. We are proud to bring Tiltan into the Nukkleus family and committed to building on their remarkable legacy."

The purchase price of NIS 47,600,000 (approximately $14 million) is payable 75% in cash through six installments ending June 2026, and 25% in Nukkleus common stock released from escrow on the settlement date. The Company's payment obligations are secured by a pledge of the acquired Tiltan shares.

Tiltan joins a growing Nukkleus portfolio focused on mission-critical defense technologies. Combined with the Company's pending acquisition of Star 26 Capital, including Rimon, a key Iron Dome component supplier, Nukkleus is assembling integrated capabilities across AI, simulation, unmanned systems, and defense electronics.

Additional details are available in the Company's Form 8-K filed today with the Securities and Exchange Commission.

**About Nukkleus Inc.**

Nukkleus Inc. (NASDAQ: NUKK) acquires and scales mission-critical suppliers across defense, aerospace, and advanced manufacturing. The company targets Tier 2 and Tier 3 businesses forming the industrial backbone of national security infrastructure in the US, Israel, and Europe. For more information, visit www.nukk.com.

**About Tiltan Software Engineering Ltd.**

Tiltan Software Engineering Ltd. is a leading Israeli defense technology company with over 30 years of experience in AI-driven simulation, synthetic data generation, 3D visualization, and GPS-denied navigation. The company serves Israel Aerospace Industries, Elbit Systems, Rafael Advanced Defense Systems, and military organizations worldwide. Tiltan has received multiple awards from the Israeli Ministry of Defense for innovation and excellence.

**Forward-Looking Statements**

This press release contains forward-looking statements pursuant to Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements are based on management's current expectations and are subject to risks and uncertainties that could cause actual results to differ materially, including the Company's ability to integrate Tiltan successfully, market acceptance, defense industry changes, geopolitical risks, and other factors described in Nukkleus' SEC filings. Forward-looking statements speak only as of this date, and the Company undertakes no obligation to update them except as required by law.

**Contacts**

**Investors:**

The Equity Group Inc.

Lena Cati

lcati@equityny.com, 212-836-9611 or

Val Ferraro

vferraro@theequitygroup.com, 212-836-9633

**Company:**

Nukkleus Inc.,

575 Fifth Avenue, 14th Floor, New York, NY 10017

info@nukk.com, 212-791-4663

**###**