NOTE 1 – ENTITY INFORMATION

Turbo Energy, S.A. (the “Company) was incorporated under the name of Distritech Solutions S.L. on September 18, 2013 under the laws of the Kingdom of Spain. The Company then changed its name to Solar Rocket S.L. on October 7, 2013. On April 8, 2021, Solar Rocket S.L. merged with a Spanish corporation Turbo Energy S.L.U. Turbo Energy S.L.U then became a wholly owned subsidiary of Solar Rocket S.L. This merger was approved by the Board of Directors of both companies. Following the merger, the Company changed its name to Turbo Energy S.L. on April 8, 2021. On February 8, 2023, we transformed the Company from a Spanish unipersonal limited company to a Spanish limited stock company. As such, our Company’s name was changed to Turbo Energy, S.A.

The corporate purpose of the Company, in accordance with its bylaws, consists of the acquisition, distribution and sale of electrical and electronic material for the development of renewable energy projects, such as solar panels, inverters, chargers, regulators, batteries and structures, among others. We design, develop and distribute equipment for the generation, management and storage of photovoltaic energy. Our energy storage products are managed from the cloud and through the inverter of the installation by an advanced software system which is optimized by artificial intelligence (“AI”). The key advantage is that our products, when compared to conventional battery storage systems, reduce electricity costs and protect the installation from power outages. Historically, we have primarily sold inverters, batteries and photovoltaic modules to installers and other distributors for residential consumers located in Spain; however, since 2022, we have shifted our focus on developing and commercializing all-in-one, AI-optimized solar energy storage systems under the brand name SUNBOX with applications in the global residential (SUNBOX Home and SUNBOX Home Lite), commercial and industrial (SUNBOX Industry) and utility-scale (SUNBOX Utility) markets.

The Company is part of the Umbrella Global Energy, S.A., whose main shareholder is Crocodile Investment, S.L.U, (hereinafter, the ultimate partner), with registered office in Valencia. The majority shareholder of the Turbo Energy, S.A is Umbrella Global Energy, S.A. (hereinafter, the majority shareholder), which is part of the Umbrella Global Energy Group.

On November 8, 2022, Turbo Energy S.A. with the purpose to develop a new business in the field of self-consumption of electricity, acquired 100% of the ordinary shares for a total amount of €2,250 of IM2 Energía Solar Proyecto 35 S.L.U., a company under common control by our CEO and established under the laws of the Kingdom of Spain on August 1, 2019. Following the transaction, IM2 Energía Solar Proyecto 35 S.L.U. became our wholly owned subsidiary. On November 29, 2022, we changed its name to Turbo Energy Solutions S.L.U.

On September 21, 2023, Turbo Energy, S.A. entered into an Underwriting Agreement with Titan Partners Group, a division of American Capital Partners, LLC, and Boustead Securities, LLC as the as the representative (“Representative”) of the underwriters named on Schedule 1 thereto, relating to the Company’s firm commitment underwritten initial public offering (the “Offering”) of ADSs, each representing five ordinary shares of the Company, par value five cents of euro per share, of the Company. Pursuant to the Underwriting Agreement, the Company agreed to sell 1,000,000 ADSs to the underwriters at a public offering price of $5.00 per ADS (the “Offering Price”), before underwriting discounts and commissions, and granted the Representative a 45-day over-allotment option to purchase up to an additional 150,000 ADSs, equivalent to 15% of the ADSs sold in the Offering, at the Offering Price per ADS, pursuant to the Company’s registration statement on Form F-1, as amended (File No. 333-273198), that was filed with the SEC and became effective on September 21, 2023, under the Securities Act of 1933, as amended (the “Securities Act”). The Offering was closed on September 26, 2023.

On September 6, 2024 Turbo Energy established a 50%-owned subsidiary in Chile for the development of storage solutions and Energy as a services (EaaS) model products and services. As of June 30, 2026, Turbo Energy owns 33% of the subsidiary in Chile.

Merger by absorption process

On April 8, 2021, the merger of Solar Rocket, S.L. (“Absorbing Company”) and Turbo Energy, S.L.U. (“Absorbed Company”) was formalized in a public deed, being registered in the Mercantile Registry of Valencia on August 9, 2021. The merger process, approved by the respective shareholders’ meetings on June 30, 2020, consisted of the extinction without liquidation of the Absorbed Company, transferring its assets and liabilities en bloc to the Absorbing Company, which acquired, by universal succession, the rights and obligations of the Absorbed Company. The Company recorded the assets and liabilities contributed by the Absorbed company at the values established in the accounting regulations in force at that time. The consolidated financial statements for the year 2021 include the information required by the regulations in relation to the aforementioned merger process.

On the same date of the merger described above, the Absorbing Company (Solar Rocket, S.L.) changed its corporate name to Turbo Energy, S.L.U., as described above.

NOTE 2 – MATERIAL ACCOUNTING POLICIES

NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING JUDGEMENTS, ESTIMATES AND ASSUMPTIONS

The preparation of these consolidated financial statements in accordance with IFRS requires management to make estimates and judgments that affect the recognition, measurement and disclosure of amounts reported in these consolidated financial statements and accompanying notes. The reported amounts and note disclosures are determined using management’s best estimates based on assumptions that reflect the most probable set of economic conditions and planned courses of action. Actual results may differ from such estimates. These judgments, estimates and assumptions are reviewed regularly.

The following are significant management judgments, estimates and assumptions used in applying the accounting policies of the Company that have the most significant effect on recognition and measurement of assets, liabilities, income and expenses:

Leases

The Company exercises judgment in determining the approximate lease term on a lease-by-lease basis. The Company considers all facts and circumstances that may create an economic incentive to exercise renewal options and also evaluates the economic incentive related to the continuation of existing leaseholds. The Company is also required to estimate specific criteria in order to estimate the carrying amount of right-of-use assets and lease liabilities including the incremental borrowing rate and effective interest rate.

Valuation of accounts receivable

Management monitors the financial stability of its customers and the environment in which they operate to make estimates regarding the likelihood that the individual trade balances will be paid. Credit risks for outstanding customer receivables are regularly assessed and allowances are recorded for estimated losses, if required.

Valuation of inventories

Management makes estimates of future customer demand for products when establishing appropriate provisions for inventory obsolescence. In making these estimates, management considers the age of inventory and profitability of recent sales.

Recoverability of income taxes

The measurement and assessment of income tax assets and liabilities requires management to make judgments in the interpretation and application of the relevant tax laws and estimates of the Company’s abilities to utilize losses carried forward to offset taxes payable on future taxable income. The actual amount of income taxes only becomes final upon filing and acceptance of the tax return by the relevant tax authorities, which occurs subsequent to the issuance of the financial statements.

Useful life of property and equipment

Changes in the intended use of property and equipment as well as changes in technology or economic conditions may cause the estimated useful life of these assets to change. The change in useful lives could impact the depreciation expense and carrying value of property and equipment.

Useful life of intangible assets

Changes in the intended use of intangible assets with determinable useful lives as well as changes in technology or economic conditions may cause the estimated useful life of these assets to change. The change in useful lives could impact the amortization expense and carrying value of intangible assets.

Terms and Conditions of Restricted Stock Units

Management determines the terms and conditions of Restricted Stock Units (‘RSU”), including the vesting criteria, the form and timing of payment, the time within which RSU may be subject to forfeiture and rights to acceleration thereof.

NOTE 4 – ACCOUNTS RECEIVABLE AND OTHER RECEIVABLES, NET

As of June 30, 2026 and December 31, 2025, the allowance for doubtful accounts was €196,362 and €174,888, respectively. During the six months ended June 30, 2026 and 2025, the Company recorded bad debt expense of €23,694 and €0, respectively. As of June 30, 2026 and December 31, 2025, €0 and €283,457 trade receivable were under factoring recourse arrangement, respectively.

NOTE 5 – INVENTORIES

As of June 30, 2026 and December 31, 2025, the Company had finished goods of €4,830,099 and €3,444,184, respectively.

The Company outsourced the management of inventories to a third party with all the inventories located in a warehouse owned by the third party. The Company pays a monthly fee to the warehouse company for insurance coverage of the inventories, as stated in the agreement between both parties.

NOTE 6 – PREPAID EXPENSE

NOTE 7 – INVESTMENTS

As of June 30, 2026 and December 31, 2025, the Company had short-term investment of €34,557 and €34,557, comprised of a short-term commercial deposit of €26,557 and €26,557 with an assembling vendor and a short-term commercial deposit with a sales company of €8,000 and €8,000, respectively. During the six months ended June 30, 2026 and 2025, the Company recognized interest income of €0 and €3,457 from the investments, respectively.

NOTE 8 – PROPERTY AND EQUIPMENT

During the six months ended June 30, 2026 and 2025, the Company acquired property and equipment of €0 and €9,008, respectively. During the six months ended June 30, 2026 and 2025, the Company recorded depreciation expense of €10,514 and €5,937, respectively.

NOTE 9 – INTANGIBLE ASSETS

During the six months ended June 30, 2026 and 2025, the Company made additions to other intangible developments of €25,340 and €450,962, respectively. Other intangible developments refer to the development carried out by the company of the Sunbox energy storage system, the SKN1 technology integrator software, which provides control, operational efficiency, and automated energy decision-making, and the SKN2 technology creator software, designed to monitor, manage, and optimize solar installations with storage from a single platform.

During the first semester of 2025, Turbo Energy had ready and already in use the new Turbo Energy software SKN2, as well as the first beta units already in use of the new SUNBOX energy storage solution developed for the U.S. market. Software development of €1,378,566 was transferred to Software SKN2 upon completion of the development.

During the six months ended June 30, 2026 and 2025, the Company recorded amortization expense of €244,527 and €48,763, respectively. The Company evaluated intangible assets for impairment for the six months ended June 30, 2026 and determined that there are no impairment losses.   

NOTE 10 – ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

NOTE 11 – RELATED PARTY TRANSACTIONS

All the amounts due to and from related parties are unsecured, non-interest bearing and due on demand, except for the loan agreement from Umbrella Global Energy, S.A. of €3,800,000. This five-year loan was formalized and signed on June 30, 2023, with a market interest rate of 6.25% per year, payable bi-annually. During the six months ended June 30, 2026 and 2025, Turbo Energy repaid €324,716 and €903,734, respectively. As of June 30, 2026 and December 31, 2025, the loan amount was €851,551 and €1,176,267, respectively. During the six months ended June 30, 2026 and 2025, a total amount of €26,448 and €40,627 had been paid for interest, respectively.

Our related party transactions during the six months ended June 30, 2026 include sales of products or services made to or purchases of products or services from affiliated group companies that are under common control and to associates of such group companies. These transactions include income accrued from the commercial activities of our Company. The purchases relate to merchandise that we sell in its normal course of commercial operations.

During the six months ended June 30, 2026 and 2025, the Company made payment to the related parties of €59,083 and €907,213, respectively. During the six months ended June 30, 2026 and 2025, the Company received advancement from related parties of €2,142 and €370, respectively.

Umbrella Global Energy, as the holding company of the group, assumes all structural costs such as those related to human resources, licenses, legal, tax, labor, marketing and other generic structural costs. A margin of 13% is applied to these costs and the resulting amount is distributed to the four most significant companies in the group based on their estimated revenue in the monthly management fees.

During the six months ended June 30, 2026 and 2025, the Company incurred management fees to Umbrella Global Energy, S.A. of €98,462 and €350,000, respectively.

No compensation has been paid to the executives under Crocodile Investment SLU. The Company expects to continue with the same allocation structure in the future.

NOTE 12 – DEBT BOND

On August 26, 2024, the Company entered into an agreement with Enerfip, a leading France-based crowdfunding platform dedicated to renewable energy projects and regulated by The French Financial Markets Authority and Prudential Control and Resolution Authority (the “Enerfip Agreement”). Pursuant to the Enerfip Agreement, the Company closed on subscriptions by European individual investors, raising total gross proceeds of €2,533,520 (approximately US$1,647,637) through a 36-month simple debt bond with an interest rate of 8.75%. During the year ended December 31, 2025 and 2024, the Company received proceed from debt bond of €1,667,638 and €865,882 and made repayment of debt bond of €219,463 and €0, respectively. During the six months ended June 30, 2026 and 2025, the Company received proceed from debt bond of €0 and €1,667,638 and made repayment of debt bond of €126,676 and €126,676, respectively. As of June 30, 2026 and December 31, 2025, the debt bond was €2,187,381 and €2,314,057, respectively.

During the six months ended June 30, 2026 and 2025, interest expense totaled €98,373 and €92,733, respectively. As of June 30, 2026 and December 31, 2025, the accrued interest was €34,310 and €36,653, respectively.

NOTE 13 – BANK LOANS

In February 2026, the Company announced the successful completion of a restructuring of its bank financing aimed at strengthening its financial position and aligning liquidity with the Company’s medium- and long-term business plan. As part of this process, Turbo Energy reached agreements with Bankinter, CaixaBank and BBVA, three of Spain’s leading financial institutions, enabling the conversion of existing lines of credit into long-term financing structures totaling approximately €4.87 million (approximately $5.75 million in U.S. dollars), whose new maturity date will be in 2029. The interest rate applicable in each period shall be the result of adding the relevant reference rate (12-month EURIBOR) plus a margin equivalent to 2% per annum.

Management assessed the terms of the restructuring under IFRS 9, Financial Instruments, and determined that the terms of the new financing were not substantially different from those of the original financial liabilities. Accordingly, the restructuring was accounted for as a modification of the existing financial liabilities, with no derecognition and no gain or loss recognized in the condensed consolidated statement of operations.

During the six months ended June 30, 2026 and 2025, the Company incurred bank loan interest expense of €73,267 and €0, respectively.

The Company’s obligations are secured by substantially all of the assets of the Company.

As of December 31, 2025 the Company maintained the following lines of credit:

As of December 31, 2025, the Company had a €3.6 million unsecured credit facility that could be drawn down to meet short-term financing needs. The facility had maturities ranging from one to three years for the ICO credit lines and was renewable automatically at the option of the Company. Interest was payable at an average rate of Euribor plus 2.11 percentage points. As part of the Company’s debt refinancing completed in 2026, the credit facility was cancelled. Accordingly, during the six months ended June 30, 2026 and 2025, the Company incurred interest expense related to the credit facility of €0 and €34,056, respectively.

NOTE 14 – SHARE CAPITAL

Authorized

The Company has authorized 75,085,700 ordinary shares with a par value of €0.05.

Issuances

During the six months ended June 30, 2026, the Company issued 7,791,405 new ordinary shares (1,558,281 ADSs, each representing five ordinary shares) through two equity transactions: a Registered Direct Offering (“RDO”) settled in March 2026 (5,000,000 shares / 1,000,000 ADSs at $3.25 per ADS), and an At-the-Market (“ATM”) program under which shares were issued in tranches between March and June 2026 (2,791,405 shares / 558,281 ADSs at a weighted-average price of $2.87 per ADS). Two further tranches available under the ATM program remained undrawn at period end. The Company generated proceeds of €3,786,022, net of underwriting/placement fees and related legal and regulatory costs of €522,420.

Issued and outstanding

As of June 30, 2026 and December 31, 2025, the total issued and outstanding share capital consisted of ordinary shares of 62,877,105 and 55,085,700 original shares, all subscribed and paid up.

Restricted Stock Units

On April 5, 2024, the Compensation Committee and the Board of Directors of the Company approved the grant of 1,780,328 Restricted Share Units (RSUs) which can be converted into 356,067 American Depositary Shares (“ADS”) of the Company, representing 1,780,328 Ordinary Shares of the Company, to certain officers, directors and employees of the Company with a vesting date of January 1, 2027.

During the six months ended June 30, 2026 and 2025, the Company recorded €67,220 and €63,682 stock-based compensation expense, respectively. The stock-based compensation incurred from RSUs awarded was reported under salaries and benefits – related parties in the statements of operations with share-based payment reserve of €0 and €32,911 recognized under reserve in the balance sheets, respectively.

During the six months ended June 30, 2025, 52,586 RSUs valued at €11,315 were forfeited.

The 1,780,328 RSUs were valued at €383,064 based on the price of the Company’s ADS which was €1.08 per ADS on the grant date of April 5, 2024.

As of June 30, 2026 and December 31, 2025, the Company had 1,727,742 RSUs valued at €371,749.

As of June 30, 2026 and December 31, 2025, the unrecognized stock-based compensation of €68,704 and €135,924 is expected to be recognized over a weighted -average period of 0.5 years and 1 year, respectively.

NOTE 15 – RESERVE

As of June 30, 2026 and December 31, 2025, reserve was €1,411,846 and €1,411,846 comprised of legal reserves and other reserves, respectively.

Legal reserve

In accordance with the Capital Company Law, companies must allocate an amount equal to 10% of the profit for the year to the legal reserve until it reaches 20% of the share capital. The legal reserve may only be used to increase the share capital. Except for the above purpose and as long as it does not exceed 20% of the share capital, the legal reserve can only be used to offset losses, provided there are no other reserves available which are sufficient for this purpose. As of June 30, 2026 and December 31, 2025, it was partially constituted after the aforementioned capital increase. As of June 30, 2026 and December 31, 2025, legal reserve was €500,857.

Other reserve

The Company maintains an unrestricted reserve for undistributed profits from previous years. As of June 30, 2026 and December 31, 2025 and 2024, other reserves were €910,989.

NOTE 16 – LEASES

On June 1, 2022, the Company entered into an office lease agreement under a two-year term extensible for three years upon expiry and monthly lease payment of €3,384 during the first year and €3,492 during the second year. On April 1, 2024, the Company extended the office lease for one additional year starting from June 2024 through May 2025 with a monthly payment of €3,618.

On September 26, 2022, the Company entered into a vehicle lease agreement under a three-year term and monthly lease payment of €420.

On November 15, 2022, the Company entered into a vehicle lease agreement under a three-year term and monthly lease payment of €417. The lease was cancelled on January 1, 2025. During the six months ended June 30, 2025, the Company recognized gain from cancellation of the lease of €137.

On August 17, 2023, the Company entered into a vehicle lease agreement under a three-year term and monthly lease payment of €572.

On February 2, 2024, the Company entered into a vehicle lease agreement under a three-year term and monthly lease payment of €458.

On April 27, 2024, the Company entered into a vehicle lease agreement under a four-year term and monthly lease payment of €619.

NOTE 17 – FINANCIAL INSTRUMENTS AND RISK MANAGEMENT

Liquidity risk

Liquidity risk is the risk that the Company will not have sufficient cash resources to meet its financial obligations as they come due in the normal course of business. Liquidity risk also includes the risk of not being able to liquidate assets in a timely manner at a reasonable price. Difficulty accessing the capital markets could impair the Company’s capacity to grow, execute its business model and generate financial returns. The Company manages its liquidity risk by monitoring its operating requirements to ensure financial resources are available, actively monitoring market conditions and by diversifying its sources of funding and maintaining a diversified maturity profile of its debt obligations.

Credit risk

Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge an obligation. The Company’s main credit risk relates to its cash and accounts receivable. The Company’s credit risk is reduced by a broad customer base and a review of customer credit profiles.

The Company’s maximum exposure to credit risk corresponds to the carrying amount for all cash and accounts receivable. Cash is held with prominent financial institutions. Accounts receivable are held with vendors in which the Company has a historically strong relationship with or related to VAT receivable.

The Company mitigates credit risk associated with its trade receivables through established credit approvals, limits and a regular monitoring process. The Company generally considers the credit quality of its financial assets that are neither past due nor impaired to be solid. Credit risk is further mitigated due to the large number of customers and their dispersion across geographic areas.

For the six months ended June 30, 2026 and 2025, there were two customers and one customer, respectively, that each accounted for more than 10% of the Company’s revenue. Collectively, these customers represented 58% and 13% of the Company’s revenue for the six months ended June 30, 2026 and 2025, respectively.

Market risk

Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: currency risk, interest rate risk and other price risk.

Currency risk

Currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. The Company is not exposed to significant currency risk.

Interest risk

Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company is exposed to interest rate risk on its lines of credit due to fluctuations in interest rates. The Company’s bank loans and leases have fixed rates of interest resulting in limited interest rate fair value risk for the Company. The Company manages interest rate risk by negotiating financing terms in individual arrangements that are most advantageous, considering all relevant factors including credit margin, term and basis. The risk management objective is to minimize the potential for changes in interest rates to cause adverse changes in cash flows to the Company.

Other price risk

Other price risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices (other than those arising from interest rate risk or currency risk), whether those changes are caused by factors specific to the individual financial instrument or its issuer, or factors affecting all similar financial instruments traded in the market. The Company is not exposed to other price risk.

Legal risk

On April 2025, Boustead Securities, LLC (“Boustead”) initiated an arbitration proceeding against Turbo Energy, S.L. (“Turbo Energy” or the “Company”) before the Financial Industry Regulatory Authority (“FINRA”), Case No. 25-01072. The arbitration arises from Boustead’s prior role as placement agent and underwriter in connection with the Company’s initial public offering. Boustead’s claims seek recovery of approximately $216,000 in cash fees and warrants for more than 96,000 shares of the Company, which Boustead alleges are due pursuant to a right of first refusal provision contained in the parties’ March 7, 2022 Engagement Agreement.

On August 7, 2025, Turbo Energy filed its Answer and asserted counterclaims against Boustead, alleging, among other things, breach of contract, negligent misrepresentation, and fraud, and seeking damages and other relief. Turbo Energy’s counterclaims arise from disputes concerning the calculation and payment of certain expenses and the scope and enforceability of Boustead’s right of first refusal. On August 27, 2025, Boustead filed its response denying all allegations in Turbo’s counterclaims and asserting affirmative defenses.

On September 18, 2025, the FINRA arbitration panel issued an order denying Boustead’s motion to change the hearing location. The arbitration proceedings remain ongoing. The Company intends to vigorously pursue its counterclaims and defend against all claims asserted by Boustead. At this stage, the Company cannot predict the outcome of the arbitration or estimate any potential loss or recovery.

Capital management

The Company’s capital consists of share capital and reserve. The Company’s capital management is designed to ensure that it has sufficient financial flexibility both in the short and long-term to support its financial obligations and the future development of the business.

The Company manages its capital with the following objectives:

There were no changes to the Company’s approach to capital management during the six months ended June 30, 2026 and 2025. The Company is not subject to externally imposed capital requirements.

NOTE 18 – REVENUE

The Company’s sales are derived from sales of electronic products and services. The following is the Company’s revenue by geographical markets during the six months ended June 30, 2026 and 2025:

During the six months ended June 30, 2026 and 2025, the Company recognized revenue of €15,021,718 and €5,437,305, of which €7,186,691 and €410,342 derived from related parties, respectively.

We consider related parties those companies that are part of Umbrella Energy Group.

NOTE 19 – COST OF REVENUE

During the six months ended June 30, 2026 and 2025, the Company incurred cost of sales of €12,549,216 and €4,188,028, respectively. 

NOTE 20 – SELLING AND ADMINISTRATIVE EXPENSES

During the six months ended June 30, 2026 and 2025, the Company incurred selling and administrative expenses of €1,479,968 and €1,493,962, of which €101,744 and €481,071 derived from related parties, respectively.

NOTE 21 – SUPPLEMENTAL CASH FLOW INFORMATION

Set out below are non-cash investing and financing activities during the six months ended June 30, 2026 and 2025

During the six months ended June 30, 2026 and 2025, the Company paid interest of €219,871 and €167,752 respectively, and income taxes of €0 and €0, respectively.

NOTE 22 – SUBSEQUENT EVENTS

Subsequent to June 30, 2026, the Company carried out several fundraising transactions in the U.S. market through the issuance of ordinary shares represented by American Depositary Securities (ADSs), using subsequent placements under the “at-the-market” (ATM) program.

Overall, the transactions described above resulted in the issuance of approximately 3.65 million shares, equivalent to approximately 0.730 million ADSs, for total gross proceeds of $1,183,664, which after direct fees and commissions totals approximately $1,116,538.

The transactions were executed progressively, with trade dates between July 27 and September 17, 2026, and settlement dates between July 28 and September 18, 2026, reflecting a staged fundraising process based on market conditions.

Including these subsequent transactions occurring after June 30 and those described in Note 2, during the entire year 2026, these transactions resulted in the issuance of approximately 11.4 million ordinary shares, equivalent to approximately 2.29 million ADSs, for total gross proceeds of approximately USD 6.2 million.

Subsequent to June 30, 2026, Turbo Energy, S.A. was served with a summons and complaint in one of three civil actions filed in the Supreme Court of the State of New York, in which it is named as a defendant alongside more than 125 defendants, including more than 100 issuers, 27 underwriters or placement agents, and 14 individuals associated with the latter. The complaints broadly allege violations of Sections 11, 12(a)(2), and 15 of the Securities Act of 1933 in connection with the Company’s September 2023 initial public offering and alleged omissions from the registration statement. The allegations are primarily based on alleged deficiencies by the entities involved in the offerings, including those that participated in Turbo Energy’s offering, and on such entities’ alleged involvement in potential pump-and-dump schemes, without making any specific allegations against the Company, its directors, officers, or employees.

As of the date of authorization of these financial statements, the proceedings remain at an early stage, and the plaintiffs have indicated their intention to seek consolidation of the three actions and to file an amended complaint. Based on the legal advice received, the complaints currently filed contain general allegations against the defendants as a group, without allegations specifically directed at the Company; accordingly, it is considered highly likely that the claims against Turbo Energy will be dismissed in their current form. Unless and until an amended complaint containing specific allegations against the Company is filed, Turbo Energy’s potential exposure is expected to be limited to the legal costs associated with the preparation and filing of a motion to dismiss, estimated not to exceed USD 50,000.

Furthermore, Turbo Energy was a co-holder, together with a related party, of a bank financing facility that was refinanced during 2026 and converted into a long-term loan. Prior to such refinancing, the related party issued a guarantee in connection with the performance of construction works for one of its customers. In July 2026, the customer called the bank guarantee for an amount of approximately EUR 830,000. The related party has expressed its disagreement with the full amount claimed, considering that the outstanding works amounted to approximately EUR 100,000.

The related party is currently negotiating with the financial institution the conversion of the amount drawn under the guarantee into a long-term loan, which would be recognized as a liability by that entity. Nevertheless, as Turbo Energy was a co-holder of the financing facility, the Company retains a direct exposure to the financial institution in the event of default by the related party or decision by the financial institution to address a claim for recovery to the Company.