2025 - Annual Report

Annual Report

2025

Contents

2025 at a glance 4

About NX Filtration 6

Report of the Management Board 8

Business review 10

Sustainability report 16

2025 month by month 30

Financial Performance 34

Risks and Uncertainties 38

Corporate governance 66

Report of the Supervisory Board 82

Financial statements 100

Consolidated financial statements 102

Company financial statements 138

Other information 148

Provision in the Articles of Association relating

to profit appropriation 150

Independent auditor's report 152

2 NX Filtration - Annual Report Contents 3

at a glance

€ 14.1 million

total income

59%

gross margin

649 billion

liters of clean water enabled

Full year revenue growth of 28%; After a relatively slow start in

H1 2025 with 12% growth, revenues

in H2 2025 grew with 45%

Proven track-record of more than 50 operational hollow fiber nanofiltration (HFNF) projects, and a further 30 projects in commissioning phase

Growing our funnel of OEM partners for our HFNF products from 160 to

180 OEMs, and further advancing OEMs in our funnel towards full scale projects

Strong traction in our ultrafiltration (UF) business, and microfiltration (MF) business for which we now have references across most major soft drink producers and global brewery groups

Excellent technology position, underscored by a sustained high gross margin

Successful integration of all operations in our new factory, driving further efficiencies

4 NX Filtration - Annual Report 2025 at a glance 5

‌Business lines

About NX Filtration

NX Filtration is a provider of membrane technology for producing pure and affordable water to improve quality of life. Its hollow

Clean Municipal Water

In its Clean Municipal Water business line, NX Filtration's membrane technology enables its customers to produce high quality water from surface water, or from municipal waste water, by removing, amongst others, micropollutants, nanoplastics and medicine residues, to treat municipal wastewater streams to prevent discharge of polluting substances in the environment, and to reuse treated wastewater for purposes that also include the production of drinking water.

Commercialization strategy

Sustainable Industrial Water

In its Sustainable Industrial Water business line, NX Filtration's membrane technology enables its customers to treat surface or well water to optimize quality and characteristics for process water, prevent discharge of polluting wastewater and reuse wastewater for industrial processes and recover, and recycle valuable raw materials from wastewater streams.

fiber nanofiltration (HFNF) technology removes micropollutants (including pharmaceuticals, medicines, PFAS and insecticides),

color and selective salts, but also bacteria, viruses and nanoplastics, from water whilst offering strong sustainability benefits.

In addition to HFNF modules, NX Filtration sells Ultrafiltration (UF) and Microfiltration (MF) modules. NX Filtration sells its filtration membrane modules in its two business lines: Clean Municipal Water and Sustainable Industrial Water.

NX Filtration's scalable commercial model is based on establishing relationships with original equipment manufacturers (OEMs), who are responsible for the design and delivery of the overall filtration system at the end-users facilities. To facilitate this process, from technology adoption to project realization, NX Filtration supports these OEMs with various tools, amongst which a large fleet of pilot systems (mobile units that are typically deployed at customers' sites to test water treatment performance, or to establish optimal process parameters and conditions for a full-scale plant). Once these OEM customers have worked with NX Filtration's membrane technology, they become an important element in the further commercial rollout of NX Filtration's products, leading to repeat orders from existing clients, and periodic module replacements at existing plants.

6 NX Filtration - Annual Report About NX Filtration 7

8 NX Filtration - Annual Report Report of the Management Board 9

‌Floris Jan Cuypers

CEO

Jan Feie Zwiers

CFO

Michiel Staatsen

COO

In the drinking water sphere, Europe made a major step in September 2025 with a provisional agreement to update priority-pollutants under the Water Framework Directive, adding PFAS, pharmaceuticals, bisphenols, and various break-

a new PFAS law seeks to reduce industrial PFAS discharges, with a 70% reduction by 2028 (compared to 2023) and a full elimination by 2030.

In addition to the favorable end-market trends

Business review

In 2025 we continued to work on our mission 'clean and affordable water for all', whilst offering strong sustainability benefits to our customers and providing an inspiring working environment for our employees.

With the building blocks for success put in place over the past years, we could start 2025 with a fierce focus on commercial execution. The impact of these efforts can be seen in our business. After a relatively slow start of the year, with year-on-year revenue growth of 12% in the first half year of 2025 that was impacted by evolving lead times in the project sched-

ules of our OEMs and end-customers, we did significantly increase our year-on-year revenue growth to 45% in the second half year of 2025. We made strong progress in our OEM funnels, and have a high-quality pipeline with clear project opportunities in sight. This positions us well for further growth in the years to come, for which we foresee revenue growth with on average 50% per year at sustained high gross margin levels, underscoring our strong technology position.

2025 was also a transition year in terms of optimizing our cost position. We completed the transfer of all our activities to our new factory and launched various efficiency programs.

We narrowly focused our research and design activities to further cement our broad and competitive portfolio across all three product ranges (HFNF, UF and MF). These efforts have already resulted in lower operating cost in 2025, in conjunction with further business growth.

With regards to Capex, we are fully invested in our new factory, with 2025 Capex 75% lower than in 2024, and further reductions expected for 2026. We continue to proactively align our cost levels to the timing of realizing our growth, therewith controlling our path towards break-even operations.

Market developments

Water scarcity and water quality remain key drivers for positive market development for hollow fiber nanofiltration in the years to come. According to the United Nations, global demand for freshwater will exceed supply by 40% by 2030 if no action is taken.

down products to the list.

In terms of wastewater, the recast EU Urban Wastewater Treatment Directive entered into force in January 2025, covering various themes that directly benefit NX Filtration's hollow fiber nanofiltration (HFNF) products. These

themes include stricter treatment requirements (amongst others for micropollutants), reuse of treated wastewater as part of national wa-

ter-resilience strategies, and energy neutrality in wastewater treatment processes. In other parts of the world regulations on wastewater treatment and reuse are also continuing to be tightened. For example, Vietnam established a new regulation for domestic and municipal wastewater in September 2025, updating discharge limits and monitoring requirements for municipal wastewater.

Water is also an increasingly pressing theme for industrial companies, particularly those in water-intensive industries like the beverage and high-tech sectors. Across Asia, tightening regulation forces industrial companies to upgrade their wastewater treatment processes. For example, in India, new consent guidelines were introduced to evaluate and enforce discharge permits in industrial sectors. In Indonesia, new regulation was introduced to establish a more comprehensive regulatory framework for industrial wastewater standards. Also, in Europe this theme continues to gain importance: in France,

supporting broader adoption of our membrane portfolio, the industry is also experiencing increased regulatory scrutiny on the use of PFAS in membrane manufacturing. This scrutiny particularly affects membrane producers that rely on PVDF (polyvinylidene fluoride)-based UF and MF membranes. By contrast, NX Filtration's PES (polyethersulfone)-based membranes are PFAS-free and therefore well-positioned to benefit from this regulatory shift.

Commercial progress

As communicated at our Capital Markets Day in April 2025, we measure our potential for the years to come based on the traction with our

OEMs in our funnel. Over the past years, we have geared our commercial efforts to developing our pipeline with strong OEM partners, based on

an increasingly stringent and targeted process, resulting in a high-quality pipeline today.

At the end of 2025, our funnel for hollow fiber nanofiltration (HFNF) related OEM partners comprised of 180 OEMs, compared to 160 OEMs at the end of 2024. During 2025, we successfully added a total of 20 OEMs to our funnel and, most importantly, further progressed OEMs through the different stages of our funnel.

Examples include Veolia (France) and Ceramed Engineers (India), with whom we secured our first Hollow Fiber Nanofiltration (HFNF) orders.

10 NX Filtration - Annual Report Business review 11

Our objective is to further commercialize our funnel of OEM partners, with HFNF revenues in the years to come primarily from:

1. New projects, repeat projects and module replacements from OEMs that today are already actively using our HFNF modules in their full-scale projects (38 OEMs versus 30 OEMs end of 2024) or are in the phase

   of project development (27 OEMs versus 25 OEMs end of 2024).

2. Channeling the OEMs that are actively testing our modules for potential future use (115 OEMs versus 105 OEMs end of 2024) further through the funnel.

In parallel to our progress on our HFNF OEM funnel, we continue to build out our business for Ultrafiltration (UF), with newly contracted OEMs including H2O Innovation (Canada), Wabag (India) and Lenntech (the Netherlands),

and Microfiltration (MF), for which we now have references across most major soft drink producers and global brewery groups. These products benefit from shorter sales and development cycles than HFNF, as we offer unique technology and solutions that primarily tap into existing replacement markets. With these products we can also create a cross-sell platform with OEMs for our HFNF products.

We are set-up to address all sweet spots across our customers' filtration needs, acting as full spectrum water filtration technology partner and enabling our OEMs to embed our technology in their offerings.

Sustainability and ESG impact

Sustainability and a clear Environmental, Social and Governance (ESG) agenda are at the heart of NX Filtration's business. We passionately believe we have a responsibility to contribute positively to society and the environment.

We continue to use our targeted ESG framework to address and monitor our impact along three pillars:

1. Clean water for all: Our 2025 membrane sales can enable the production of 649 billion liters of clean water1, enabling access to clean water across 34 countries.

2. Avoiding emissions at our customers: With our membrane module sales in 2025, we enabled 6,222 ton CO2e savings during the deployment lifetime of our modules, by avoiding the use of 11.6 million kg of chemicals and saving 141 GWh energy compared to conventional technologies.

3. Our internal initiatives: We have implemented various sustainability measures and initiatives around ESG related themes in our own operations, for our employees and our partners.

In our Sustainability Report, that forms part of this Annual Report, we further elaborate on these and other ESG related aspects.

Outlook

In recent years we have put strong building blocks in place for the growth journey ahead of us, amongst others related to our solid technology, expanded production capacity, strong ESG framework, our global sales organization, and our growing pipeline of commercial opportunities. Based on these building blocks, we have set clear priorities that we will drive with full dedication.

First and foremost, we will continue our existing approach in developing OEM relationships and converting project opportunities into orders, and build on existing OEM relationships for repeat orders. Based on the learnings from prior years we are further pursuing our commercial

focus towards high-yielding product-market combinations across our HFNF, UF and MF product lines. We also proactively align our product portfolio, and the efforts of our research and development team, to products that directly serve commercial market opportunities.

For the years to come, NX Filtration continues to focus on realizing its medium-term objectives, targeting revenue growth with on average of 50% per year at sustained strong gross margin levels, and realizing break-even operations. We continue to proactively align our cost levels to the timing of realizing our growth, therewith controlling our path towards break-even operations. After the completion of our new factory in 2024, and the consolidation of all our operations in this new factory in 2025, our investment agenda is expected to be further reduced in 2026.

Our longer-term growth ambitions are unchanged, given the enormous challenges the global water sector faces and our unique portfolio of products that address these challenges. We continue to work on our mission 'clean and affordable water for all', whilst offering strong sustainability benefits to our customers and providing an inspiring working environment.

Management Board

Floris Jan Jan Feie Michiel Cuypers Zwiers Staatsen CEO CFO COO

1 Based on NX Filtration's sales of approximately 5,358 membrane modules (HFNF and UF only), multiplied by the expected capacity and lifetime of such modules. See Sustainability Report for details, assumptions and methodologies

12 NX Filtration - Annual Report Business review 13

Major milestone of commissioning of the large scale HFNF wastewater reuse plant in Mexico, for which NX Filtration received a repeat order in 2025 to double the capacity.

14 NX Filtration - Annual Report Business review 15

‌Sustainability report

Introduction

Sustainability and ESG are at the heart of NX Filtration's business. Our vision is to be a leading global provider of breakthrough nanofiltration technology that enables customers to, amongst others, produce pure and affordable water, treat wastewater, reduce their water footprint and achieve strong sustainability benefits.

Water scarcity and water quality are major global and structural issues and key drivers of the water market. For example, it is estimated that 1.1 billion people worldwide lack access to water, and a total of 2.7 billion people find water scarce for at least one month of the year.1 By the end of 2025, approximately two-thirds of the world's population may face water shortages. In addition, the discharge of wastewater increasingly poses challenges for the environment (for example the presence

of antibiotic resistant bacteria resulting in potential health issues) and for the production of drinking water (for example increased requirements on the removal of micropollutants).

NX Filtration's direct nanofiltration technology can play a central role in addressing these issues. Our technology is designed to remove micropollutants (including pharmaceuticals, medicines, PFAS and insecticides), colour

and selective salts from water in one single

step and also removes bacteria, viruses and nanoplastics from polluted fresh water sources.

energy consumption, so that a competitive operational costs can be offered to our clients.

At NX Filtration, we believe we have a responsibility to

contribute positively to society and the environment. We are officially B Corp certified and

joined a global movement of over 8,400 B Corps that pursue a sustainable purpose alongside profit. We believe we have a responsibility

to contribute positively to society and the environment. A B Corp must meet high, verified standards in terms of social and environmental impact, accountability and transparency and the certification is granted by B Lab. B Lab is the nonprofit network transforming the global economy to benefit all people, communities, and the planet. The B Corp certification addresses the entirety of a business' operations and covers five key impact areas of Governance, Workers, Community, Environment and Customers. Every three years, B Corps must recertify to uphold certification. Becoming a B Corp marks another significant milestone in advancing our ESG agenda and demonstrates our commitment

to a sustainable and socially responsible organization. Together with the global B Corp community we take collective action to address society's most critical challenges.

Moderate

Additionally, we remain very well on track to meet our externally certified science-based

Targets initiative (SBTi), and we continued to participate in the United Nations Global

Compact initiative by actively submitting our Communication of Progress 2025. Our formal ESG Committee continued with overseeing matters with regard to sustainability, environmental, social, corporate governance and human capital matters. Further reference is made to the Risks and Uncertainties paragraph of our Management Board Report in which we describe our efforts in 2025

on various topics such as code of conduct compliance, business ethics and human rights.

Very high

As used throughout this Annual Report, "ESG" means Environmental, Social and Governance. Environmental factors for example include the contribution NX Filtration makes to climate change through (the reduction of) greenhouse

gas emissions, along with waste management and energy efficiency by the use of its products. Social factors for example include human rights, labor standards throughout the supply chain, and more routine issues such as adherence

to workplace health and safety and gender equality. Governance refers to a set of rules or principles defining rights, responsibilities and expectations between different stakeholders in NX Filtration's governance.

Alignment with UN Sustainable Development Goals

To obtain input on material topics on environmental, social and economic parameters, NX Filtration performed a broad stakeholder survey amongst employees,

High

The direct nanofiltration technology avoids the

CO2

reduction targets, as confirmed by

Social material topics

Importance for stakeholders

use of pretreatment chemicals in the water treatment process and substantially reduces

ongoing performance tracking against our approach that was approved by Science Based

Economical material topics

1 Source: https://www.worldwildlife.org/our-work/freshwater/water-scarcity/

Moderate

High Very high

Importance for NX Filtration

16 NX Filtration - Annual Report Sustainability report 17

customers, suppliers, communities and partners. These material topics formed the basis for the development of a materiality matrix and the mapping to the UN SDGs.

Vision

To be a leading global provider of technology for producing pure and affordable water to improve our quality of life.

The SDGs are guiding NX Filtration's ESG agenda, by way of which NX Filtration supports society. NX Filtration has selected five SDGs that today form an integral part of NX Filtration's strategic framework. The SDGs that NX Filtration seeks to contribute to are

SDG 6 - Clean water and sanitation, SDG 8

- Decent work and economic growth, SDG 9 -Industry, innovation and infrastructure, SDG 12 - Responsible consumption and production and SDG 17 - Partnership for the goals. NX Filtration has set key performance indicators (KPIs) for each SDG and is monitoring these KPIs and initiating improvement actions. These KPIs are described in the paragraph

NX Filtration's integrated ESG framework.

ESG Committee

At NX Filtration we have a clear vision to be among the best-in-class performing ESG companies, not only in what we do, but also in how we do it. We have therefore installed a formal ESG Committee. The purpose of the ESG Committee is to assist and support the Management Board and the Supervisory Board in carrying out its governance and oversight responsibilities with regard to

sustainability, environmental, social, corporate governance and other human capital matters. The members of the ESG Committee are NX Filtration's independent Supervisory Board members Ms C. (Carolina) Wielinga en Mr

B.A.M. (Benno) van Dongen. The installment of a formal ESG Committee has further shaped NX Filtration's ESG agenda and the broad duties and responsibilities include, amongst others: (i) monitor, evaluate and provide guidance on our policies, procedures and practices with respect to ESG matters;

(ii) review and monitor the development and implementation of targets, standards, metrics or methodologies that NX Filtration may establish from time to time, (iii) oversee our public disclosure on ESG matters, (iv) review and monitor initiatives to manage and mitigate its environmental impact (greenhouse gas (GHG)- and non-GHG reduction); (v) review and monitor any significant examination or audit by external auditors (if any, which has

not taken place in 2025), regulators or key ESG rating agencies on ESG matters (such as B Corporation); (vi) review and monitor, as appropriate, human capital initiatives, for example diversity and inclusion initiatives,

employee wellbeing or engagement initiatives (such as UN Global Compact); and (vii) review and monitor, as appropriate, social initiatives and commitments, including, among others, initiatives related to the field of education.

The Science Based Targets initiative (SBTi)

NX Filtration's CO2reduction targets for Scope 1 and Scope 2 emissions have been officially validated by the SBTi. By committing to the SBTi, NX Filtration commits to a 42% decrease in absolute Scope 1 and 2 emissions by 2030. To achieve this target, NX Filtration will procure green electricity, continues to switch to electric vehicles, and further electrify its operations.

The SBTi defines and promotes best-practices in setting emission reduction targets and is considered the most ambitious and reputable carbon target setting standard globally.

Mission

Inspired by our team's passion for membranes we develop and produce innovative products and solutions, enabling our partners to excel in membrane filtration applications.

Company values

Science-based targets are emissions reduction targets which are in line with scenarios deemed necessary by climate scientists to meet the goals of the Paris Agreement of limiting global warming to a maximum of 1.5 °C.

18 NX Filtration - Annual Report Sustainability report 19

NX Filtration's integrated ESG framework

Environmental

Social

Governance

US Sustainable Development Goal 6 - Pure and affordable water for all

Energy efficient operation

Avoiding chemicals in pre-treatment

Diversified employee base

Green chemistry

Safety

Sustainable supply chain

Production energy savings

Training and development

Knowledge sharing

NX Filtration has established an ESG framework to embed ESG in its way of working. This ESG framework consists of three layers.

Clean water for all

Avoiding emissions at our customers

Key KPIs in this respect mainly relate to SDG 12 (responsible consumption and production) and include i) GHG emissions scope 1 and 2 and 3 (upstream) and ii) avoided GHG emissions during the use of NX Filtration's membrane modules.

The third layer constitutes NX Filtration's own organisation, in which it has implemented various sustainability measures and is deploying various initiatives around ESG related themes. For example, NX Filtration's coating process for its HFNF membranes is based on water-based chemistry (green chemistry), in contrast to conventional solvent-based coating processes and NX Filtration has developed an energy efficient membrane spinning process based on a unique in-line polymer mixing concept. NX Filtration is valuing a diverse workforce. For example, its 158 FTEs at 31 December 2025

represented 20 nationalities.

Our internal initiatives

The first layer constitutes the impact NX Filtration is aiming to make with its technology in addressing the global challenges around water scarcity and water quality, contributing to SDG 6 relating to clean water and sanitation. NX Filtration seeks to be a leading and global provider of breakthrough technology for producing pure and affordable water to improve quality of life.

Key KPIs in this respect mainly relate to SDG 6 (clean water and sanitation) and include i) the amount of clean water production enabled by NX Filtration membrane module sales and ii) the number of countries in which NX Filtration supplied its membrane modules.

The second layer constitutes the impact NX Filtration is aiming to make on its customers' operations and on its partners. The energy efficient and chemicals free operation of NX Filtration's membranes requires less energy compared to conventional technologies (environmental impact) and NX Filtration's solution avoids the use of flocculants and coagulants in pre-treatment (that is required for traditional filtration processes) and requires a low cleaning frequency (environmental and social impact). NX Filtration has a strong academic network; it partners and cooperates with multiple universities and research institutes around the world, including the University of Twente, Saxion University of Applied Sciences and the Universität Hamburg (governance impact).

Key KPIs in this respect mainly relate to SDG 8 (decent work and economic growth) including i) growth in the number of employees and ii) lost time injury rate, SDG 9 (Industry, innovation and infrastructure) including i) the number of patents filed and granted and ii) the number of scientific publications authored or supervised by NX employees and SDG 17 (partnerships

for the goals) including i) progress on the implementation of the supplier code of conduct and ii) NX Filtration's network of research partners.

On the following pages, various examples and KPIs have been included on these three layers.

20 NX Filtration - Annual Report

Sustainability report 21

Our impact in 2025*

Our 2025 membrane sales

enabled clean water across 34 countries worldwide

2025 membrane sales could enable the production of:

649 billion liters of clean water

Based on NX Filtration's sales of approximately 5,358 membrane modules (HFNF and UF), multiplied by the expected capacity and lifetime of such modules.

Rest of the World

8%

2025 revenue of sale of goods by region

Asia

43%

27%

Europe

22%

North America

* Please note the statements and information provided in this section are unaudited.

Europe

22 NX Filtration - Annual Report Sustainability report 23

Our impact in 2025*

NX Filtration's GHG footprint in 2025 amounted to:

Methodology: GHG Protocol

The Greenhouse Gas Protocol (GHG Protocol) defines three emission scopes.

• Scope 1 emissions refer to all direct greenhouse gas emissions from sources that are owned or controlled by the organization itself.

• Scope 2 emissions are all indirect greenhouse gas emissions stemming from the consumption of purchased electricity, steam, or other sources generated upstream.

  Base year

  NX Filtration has set the base year at 2020 as this is the first year that NX Filtration has

  verifiable emission data available on essentially all scopes.

  GHG footprint of NX Filtration

  The reported GHG footprint of NX Filtration includes all emissions of Scope 1, Scope 2, and business travel of Scope 3, in line with the GHG protocol.

  648

  ton CO2e

  versus:

  CO2e savings

  enabled during the deployment of NX Filtration's

  membrane modules

  avoidance of 11.6 million kg of chemicals

  141 GWh energy savings

• Scope 3 emissions are all other indirect greenhouse gas emissions resulting from an entity's operations. This includes both upstream and downstream supply chains, such as the extraction and production

of purchased materials and fuels, flight emissions, waste disposal, investments, etc.

Please note the statements and information provided in this section are unaudited.

Organizational boundaries

NX Filtration's organisational boundary has been determined according to the principles laid down in the GHG protocol. NX Filtration reports the emissions from its operations over which it has financial or operational control.

Using this approach, this section includes emissions from its subsidiaries, NX Filtration B.V., NX Filtration International B.V., NX Filtration Real Estate B.V. (each incorporated in the Netherlands), NX Filtration (Beijing) Membrane Technology Co. (incorporated under Chinese law), Ltd., NX Filtration India Private Limited (incorporated under Indian law), and NX Filtration Americas, LLC (incorporated under United States law) so the reported GHG-data is on a fully consolidated basis.

NX Filtration's total emissions in 2025

amounted to 648 ton CO2e (CO2 equivalent). Scope 1 CO2e emissions amounted to 308 ton, of which 7% related to lease cars and 93% to natural gas combustion). The natural gas usage (147,609 cubic Nm3) was CO2compensated through NX Filtration's energy supplier by investments in Verified Emission Reduction units. Scope 2 CO2e emissions amounted to

40 ton under the well to wheel approach. If we include CO2e emissions due to the construction and demolition of wind turbines (under an LCA approach) we add approximately 0.014 grams

of CO2e per kWh meaning 27 ton CO2e emission for electricity (based on 1,963 MWh). These

Scope 2 emissions were all off-set as 100% of the purchased electricity (1,963 MWh) was

sourced from European wind projects. Reported Scope 3 CO2e emissions related to business travel (currently the only Scope 3 emissions that are monitored) amounted to 300 ton CO2e in 2025.

Downstream CO2e savings of

NX Filtration's products

The downstream CO2e savings that NX Filtration enables through offering its HFNF membrane modules as an alternative to conventional water treatment technologies, such as activated carbon or a combination of ultrafiltration and reverse osmosis, add up to approximately 3,578 kilo CO2e saved over the typical lifetime of a module.

In this analysis, the chemicals and energy footprint of NX Filtration's technology has been compared with a broad set of alternative technologies based on sources including Aggarwal (Rahul Aggarwal, "Strategic Assesment of Drinking Water Production Systems Environmental impacts from a

Life Cycle perspective", KTH Royal Institute of Technology, school of architecture and the built environment, Stockholm, Sweden 2020) and The Water Factory (Energie en Grondstoffenfabriek). CO2e savings of NX

Filtration's other products have not been taken into account in this analysis of downstream savings, despite the fact that the production and related activities (such as business travel) of such products has been included in the GHG

footprint analysis of NX Filtration.

CO2e emission and energy consumption reduction programs at NX Filtration Albeit emissions in upstream and business related activities represent a relatively small portion compared to downstream emissions,

NX Filtration is implementing various programs to further reduce its energy consumption

and CO2e emissions per membrane module. Programs focus on those areas where most improvement can be made, most notable in reducing waste in the production process. It is expected that, after the start-up of the new megafactory and the integration of our existing operations into this facility, we will be able to realize reductions of waste in production. Other

ongoing programs to reduce our CO2 footprint include the recovery of materials used in the

production process and further production efficiencies. ESG is strongly embedded in the design of our new megafactory, with more than 400 solar panels for electricity generation, a unique peer-to-peer heat exchange contract with a neighboring datacenter, an extensive heat energy management and reuse system,

and an inhouse water treatment facility.

* Please note the statements and information provided in this section are unaudited.

24 NX Filtration - Annual Report Sustainability report 25

Our impact in 2025*

Employees

Research &

Academic network

19

partnerships with universities and research institutes around the world

158 the number of employees

development

Our workforce decreased from 169 FTE at the end of 2024 to 158 FTE at the end of 2025, representing 20 nationalities. In addition to the Netherlands, NX Filtration has sales representation in China, Egypt, France, Germany, India, Indonesia, Japan, Singapore, Spain, United Arab Emirates, United Kingdom, United States and Vietnam, and works with commercial and technical partners in various other parts of the world.

NX Filtration is placing strong emphasis on training and development with a focus on innovation, not only for NX Filtration's employees, but also for customers, partners and graduates. We are facilitating internships, joint research programs and partnerships with universities and research institutes.

patents as per

52

31 December 2025

Our patent portfolio included 10 patent families with in total 52 patents granted. In addition, we are working on various programs to further improve the sustainability of our production process, that is already working according to a 'green chemistry' process. Each of the initiatives on NX Filtration's research &

Safety

4 lost time injuries in 2025

and 0 fatalities in 2025

100%

Suppliers

adherence to NX Filtration's Supplier Code of Conduct by all material suppliers and

development roadmap is monitored against its contribution to our sustainability objectives.

NX Filtration harnesses a culture of safety, where health and safety risks are minimized with a methodology based on the safety awareness model. The management of NX Filtration is highly committed to improving health and safety conditions. This commitment is shown, amongst others, by a clear communication to all employees. Upon joining NX Filtration, each employee receives an introduction safety training and each department meeting starts with a health and safety topic. A proactive hazard reporting system has been introduced, wherein every employee is motivated to report hazards, to secure a safe workplace for all by improving and securing processes by learning from hazards/near misses and preventing it will not happen in future. Our QSHE manager is responsible for managing and improving our health and safety agenda.

NX Filtration had 4 lost time injuries in 2025 (2024: 0) and 0 fatalities in 2025 (2024: 0). NX Filtration has a safety policy, conducted safety trainings and is pro-actively sharing alerts and performance.

contractors for our new megafactory

NX Filtration actively engages with its suppliers about its Supplier Code of Conduct.

Compliance therewith is included in legally binding agreements with our material suppliers and contractors for our new megafactory. We also conducted and continue to conduct various audits with existing and new suppliers. At NX Filtration, we are very much committed to strengthen the value chain by actively engaging with our suppliers, not only from a pure business perspective but also to pursue certain standards and values. We value a reliable and sustainable business relationship, a better environment, a safe workplace, high quality standards and the highest integrity. The principles we value most and are regarded as a minimum standard for us to cooperate based upon, are laid down in our Supplier Code of Conduct, which we apply to all of our suppliers. The spirit thereof is professional, reliable,

down-to-earth and accountable.

Knowledge sharing

2

scientific publications, including Nature Water and Journal of Membrane Science

In total, our people authored in approximately 54 peer reviewed scientific publications since 2016. In 2025, our people authored in 2 peer reviewed scientific publications, amongst others, in Nature Water and Journal of Membrane Science.

Throughout 2025 a total of 15 students and trainees were part of the NX Filtration's team, e.g., as an intern for their BSc or MSc thesis. More than 20 lectures were given by NX Filtration's team at various conferences and shows.

* Please note the statements and information provided in this section are unaudited.

26 NX Filtration - Annual Report Sustainability report 27

Our impact in 2025*

Employees

158 the number of employees

Our workforce decreased from 169 FTE at the end of 2024 to 158 FTE at the end of 2025, representing 20 nationalities. In addition to the Netherlands, NX Filtration has sales representation in China, Egypt, France, Germany, India, Indonesia, Japan, Singapore, Spain, United Arab Emirates, United Kingdom, United States and Vietnam, and works with commercial and technical partners in various other parts of the world.

NX Filtration is placing strong emphasis on training and development with a focus on innovation, not only for NX Filtration's employees, but also for customers, partners and graduates. We are facilitating internships, joint research programs and partnerships with universities and research institutes.

Safety Suppliers

4 lost time injuries in 2025 100% adherence to NX Filtration's and 0 fatalities in 2025 Supplier Code of Conduct

by all material suppliers and

NX Filtration harnesses a culture of safety, where contractors for our new

health and safety risks are minimized with a megafactory

methodology based on the safety awareness

model. The management of NX Filtration is highly NX Filtration actively engages with its suppliers committed to improving health and safety about its Supplier Code of Conduct.

conditions. This commitment is shown, amongst Compliance therewith is included in legally others, by a clear communication to all employ- binding agreements with our material suppliers ees. Upon joining NX Filtration, each employee and contractors for our new megafactory. We receives an introduction safety training and each also conducted and continue to conduct various department meeting starts with a health and audits with existing and new suppliers. At NX safety topic. A proactive hazard reporting system Filtration, we are very much committed to

has been introduced, wherein every employee is strengthen the value chain by actively engaging motivated to report hazards, to secure a safe with our suppliers, not only from a pure workplace for all by improving and securing business perspective but also to pursue certain processes by learning from hazards/near misses standards and values. We value a reliable and and preventing it will not happen in future. Our sustainable business relationship, a better QSHE manager is responsible for managing and environment, a safe workplace, high quality improving our health and safety agenda. standards and the highest integrity. The

principles we value most and are regarded as a NX Filtration had 4 lost time injuries in 2025 minimum standard for us to cooperate based (2024: 0) and 0 fatalities in 2025 (2024: 0). upon, are laid down in our Supplier Code of

NX Filtration has a safety policy, conducted Conduct, which we apply to all of our suppliers. safety trainings and is pro-actively sharing The spirit thereof is professional, reliable, alerts and performance. down-to-earth and accountable.

* Please note the statements and information provided in this section are unaudited.

Preparation of the Sustainability Report

This Sustainability Report has been prepared on a voluntary basis and is not fully aligned with the requirements of the Corporate Sustainability Reporting Directive (CSRD) or the EU Taxonomy. As NX Filtration is currently not within the scope of mandatory CSRD reporting, compliance with these frameworks is not yet required. Nevertheless, NX Filtration closely monitors regulatory developments and

is actively preparing for future alignment where applicable.

The content of this Sustainability Report has been developed primarily using a data-driven approach, drawing on available operational, environmental, and financial information.

While this Sustainability Report reflects management's best understanding of current performance and progress, formalized internal controls, risk management processes, and assurance procedures are not yet fully embedded across all sustainability data streams. Formal controls, structured risk management, and documentation processes are currently under development and will be implemented to enhance data robustness, governance, and audit readiness in future reporting cycles.

The information provided in this Sustainability Report has not been subject to an audit or limited assurance assignment by a third party.

Looking ahead

While growing, the company remains steadfast in its commitment to Environmental, Social, and Governance (ESG) principles. NX Filtration places importance on maintaining high ESG standards, recognizing our significance for

long-term success, customer satisfaction, environmental well-being, and societal benefits. The ongoing substantial growth of NX Filtration opens up numerous opportunities to integrate ESG considerations with the right standards right from the outset.

In 2026, NX Filtration aims to persist in its business expansion, concurrently increasing the impact through the sale of membrane products. This commitment contributes to global access to clean and safe water while simultaneously reducing energy and chemical usage in water treatment processes. As our business scales up, the goal is to further decrease energy consumption and implement measures to minimize greenhouse gas (GHG) emissions. This involves initiatives such as procuring green electricity, continuing the transition to electric vehicles, and electrifying operations. Other crucial factors in achieving this objective encompass enhancing efficiency in new production lines, adopting more energy-efficient production methods, and moving towards low-carbon distribution and logistics through active engagement with suppliers.

28 NX Filtration - Annual Report Sustainability report 29

‌2025 month by month

13

January

11

March

April

8

NX Filtration receives BREEAM-NL certification for sustainable growth

NX Filtration's new factory obtains BREEAM-NL

certification with an 'Excellent' rating, underlining its commitment

to sustainable practices and sustainable growth. The new facility exempli-

fies cutting-edge sustainability

through a combination of energy-saving measures,

water conservation strategies, and innovative heat recovery solutions.

Nijhuis Saur Industries and NX Filtration launch mobile nanofiltration unit

Nijhuis Saur Industries (NSI), part of Saur Group, and NX Filtration unveiled the Mobile Nanofiltration (MONF) unit at Aquat-

ech 2025. The MONF unit merges NSI's expertise in industrial and municipal water treatment with NX Filtration's sta-

teof-the-art hollow fiber membrane technology, offering a modular and chemical-free solution that allows industries

to effectively close the water loop.

13 March

Collaboration UPPWATER Pharmaceutical Residue Removal

NX Filtration joined the UPPWATER consortium with Nijhuis Saur Industries and Wa-terschap Vechtstromen to remove pharma-

ceutical contaminants from wastewater. Supported by the Dutch National Growth Fund, the project demonstrates the capability of hollow-fiber nanofiltration for micropollutant removal for drinking water providers, hospitals and municipal utilities.

Capital Markets Day - Next Phase of Growth

NX Filtration welcomed approximately 50 investors at its Capital Markets Day, providing further background to market developments, our commercial strategy, the strong progress we are making in developing our pipeline of OEM customers, and our continued growth prospects for the medium- and longer term.

26

May

NX Filtration nominates Piers Clark as member of the Supervisory Board

NX Filtration announced the nomination of Piers Clark as Supervisory Board member. Dr Clark has a broad experience and track record in the water industry, and is a valuable addition

to the Supervisory Board due to his experience in the global water sector

supporting innovative technology companies.

11 July

Repeat order - doubling the world's largest HFNF plant capacity

NX Filtration received a repeat order from SA-PAL (via EcoAzur) to double the capacity of the world's largest hollow-fiber nanofiltration plant. Together with the first phase of the project, that was already awarded in 2024, the total capacity of the plant will be 34 Million Liters per Day (MLD). The installation produces drinking water from treated wastewater, confirming large-scale viability for indirect potable reuse.

30 NX Filtration - Annual Report 2025 month by month 31

25

August

NX Filtration and Eau d'Azur partner for advanced micropollutant treatment in Nice NX Filtration announced a collaboration with Eau d'Azur for advanced micropollutant removal at the Haliotis urban wastewater treatment plant in Nice. The program anticipates tightening future EU discharge regulations and

supports sustainable municipal wa-

ter quality improve-

ments.

November

12

Bengaluru to get first full-scale hollow fiber nanofiltration water recycling plant The Bangalore Water Supply

and Sewerage Board (BWSSB) and Ceramed Engineers have inaugurat-

ed Bengaluru's first full-scale municipal water recycling facility based on HFNF technology. The installation uses

NX Filtration's HFNF membranes to produce

high-quality reuse water from

treated sewage, marking a significant step toward circular water management in one of India's fastest-growing urban regions.

22

December

20

October

Beijing Captain and KSM Water introduce NX Filtration's HFNF technology for safe and healthy drinking water systems in office environments

Together with Beijing Captain Science Co., Ltd and KSM Water, NX Filtration's membranes have been implemented in a unique project that brings chemical-free, safe, and mineral-bal-anced drinking water to office environments across Beijing.

NX Filtration expands presence in Indonesia through partnership with Jaya Teknik Indonesia

Indonesia-based system integrator Jaya Teknik Indonesia selected NX Filtration to supply ultrafiltration (UF) modules for the large-scale 5 MLD Ancol Seawater Reverse Osmosis (SWRO) plant in Jakarta. The UF solution will rein-

force the plant's pre-treatment performance, supporting long-term membrane protection and stable freshwater production for the wider Ancol tourism district.

32 NX Filtration - Annual Report

2025 month by month 33

‌Financial Performance

Gross income

Gross income increased by 28% from € 11,084 thousand in 2024 to € 14,135 thousand in 2025.

Revenues from the sale of goods increased by 26% from € 10,085 thousand in 2024 to

€ 12,681 thousand in 2025. Other income increased by 46% from € 999 thousand in 2024

to € 1,435 thousand in 2025.

NX Filtration experienced a relatively slow start of the year, with year-on-year revenue growth of 12% in the first half year of 2025, as communicated in August 2025. We were impacted by evolving lead times in the project schedules of our OEMs and end-customers.

Although this situation continued during the year, we did significantly increase our year-on-year revenue growth to 45% in the second half year of 2025.

NX Filtration is a provider of membrane technology for producing pure and affordable water to improve quality of life. Its hollow fiber nanofiltration (HFNF) technology removes micropollutants (including pharmaceuticals,

medicines, PFAS and insecticides), color and selective salts, but also bacteria, viruses and nanoplastics, from water whilst offering strong sustainability benefits. In addition to HFNF modules, NX Filtration sells Ultrafiltration

(UF) and Microfiltration (MF) modules. NX Filtration sells its filtration membrane modules in its two business lines: Clean Municipal Water and Sustainable Industrial Water. As there is a strong interrelationship between NX Filtration's different business activities, management

reviews the profitability of the Company on an aggregate level. All financial information can be found in the consolidated financial statements.

Gross income (€ '000)

+28%

14,135

11,084

Other income

Sustainable Industrial Water

Clean Municipal Water

2024 2025

34 NX Filtration - Annual Report Financial Performance 35

NX Filtration added important new OEMs to its customer base, strengthened relationships with its existing OEM partners resulting in various repeat orders, and experienced strong traction in onboarding new OEMs to its customer base. Examples include Veolia (France) and Ceramed Engineers (India), with whom we secured our first Hollow Fiber Nanofiltration (HFNF) orders. In parallel to our progress on our HFNF OEM funnel, we continue to build out our business

for Ultrafiltration (UF), with newly contracted OEMs including H2O Innovation (Canada), Wabag (India) and Lenntech (the Netherlands), and Microfiltration (MF), for which we now have references across most major soft drink producers and global brewery groups. With this basis, we benefit from a strong pipeline of project opportunities for 2026 and beyond.

Gross margin, EBITDA and Net result

Gross margin remained strong at 59.1% (61.0% in 2024) and is underpinning our strong technology position.

EBITDA loss was € 15,631 thousand in 2025 compared to a loss of € 15,659 thousand in 2024. EBITDA was positively impacted by higher revenues at strong gross margins, in combination with lower operating expenses1 (€ 22,726 thousand versus € 24,541 thousand in 2024), driven by efficiencies resulting from the integration of all operations in our new factory, and ongoing measures to align our

cost levels to the timing of realizing our growth. EBITDA in 2025 was negatively impacted by

€ 1,856 thousand resulting from the change in inventories of finished goods and work in progress, compared to a positive impact of

€ 1,731 thousand in 2024.

Net loss (after tax) amounted to € 25,692k, compared to net loss of € 23,089k in 2024. The higher net loss was primarily due the change in inventories and the full year effect of the depreciation for the new factory and related machinery.

Cash flows and investments

The cash position at 31 December 2025 amounted to € 28,504 thousand, compared to a cash position of € 53,375 thousand at 31 December 2024. With regards to capital expenditures, we are fully invested in our new factory, with 2025 Capex totaling € 6,381 thousand, which is 75% lower than in 2024, and further reductions expected for 2026.

NX Filtration capitalized € 1,749 thousand of development costs which demonstrates the company's continued efforts to invest in innovations for the future. Total FTE slightly

decreased to 158 at 31 December 2025 (versus

169 at 31 December 2024). We are able to benefit from efficiencies resulting from our larger scale operations, and continue to proactively align our cost levels to the timing of realizing our growth, therewith controlling our path towards break-even operations. The Company does not pay any dividend for the year.

1 Operating expenses, excluding the cost of raw materials and consumables, changes in inventories of finished goods and work in progress, and amortization and depreciation.

36 NX Filtration - Annual Report Financial Performance 37

‌Risk Management

Risk management framework and control systems

Effective risk management is essential for executing NX Filtration's strategy, delivering long-term value for stakeholders, protecting its reputation, and ensuring sound corporate governance. While NX Filtration promotes entrepreneurship and empowers management to exercise appropriate discretionary powers, its risk management approach acknowledges that exposure to risk is an inherent part of doing business. Rather than attempting to eliminate all risks, NX Filtration seeks to balance fostering an entrepreneurial spirit with maintaining a strong culture of risk awareness.

NX Filtration's risk management framework is based on the COSO Enterprise Risk

Management Framework and outlines how risks are identified, assessed, and managed across the Company. The Management Board sets the strategy, determines the level of acceptable risk, and oversees key mitigation measures. The framework includes:

• Identifying risks related to strategic choices and setting appropriate controls.

• Assessing major strategic, operational, financial, and compliance risks and their impact.

• Implementing measures to control, reduce, or avoid risks.

The Management Board is responsible for the control environment, including risk

management and internal control systems in order to properly manage the strategic,

operational and other risks and uncertainties that could have a material adverse effect on NX Filtration's business and day-to-day operations. The applicable risks and uncertainties for NX Filtration are evaluated on an annual basis by the Management Board and discussed with the Supervisory Board.

The Management Board recognizes the importance of a formalized approach towards risk management for a rapidly growing organisation like NX Filtration. In practice this means that it is important to maintain the right balance between formalized systems and

procedures and the informal hands-on approach that is necessary to further boost the growth of the Company. NX Filtration's corporate culture supporting the values of curiosity, honesty and collaboration is also an important 'soft-control' to mitigate risks and fraud.

During the financial year 2025, NX Filtration continued to support its corporate culture and other foundations of its risk management and control systems with its Code of Conduct, Human Rights Policy, Whistle-blower Policy, Insider Trading Policy, safety and quality certifications, periodic reporting and monitoring, as further described after a detailed description of the various risks. NX

Filtration introduced a structured approach to introducing and maintaining the understanding of the Company's vision and mission within the team.

Our risk frameworks are essential pillars in fortifying NX Filtration against potential risks and ensuring the integrity of its operations. In the years ahead, NX Filtration will continue to professionalize and strengthen its organization and control environment, further optimizing its control matrix. NX Filtration has implemented appropriate segregation of duties, not only to properly divide responsibility and accountability, improve the quality of the staff, but also to create a system of checks and balances. To support this further, NX Filtration optimized the data warehouse and reporting system in which our business processes as well as our day-to-day working procedures are formally documented.

The Management Board, to the best of its knowledge, is not aware of any significant deficiencies in its control environment, including risk management and internal control systems.

Risks and Uncertainties 39

Risks and Uncertainties

38 NX Filtration - Annual Report

Below is a summary of our risks, our risk appetite, likelihood and potential impact. For a detailed description of these risks and how we believe we mitigate these risks we refer to the disclosure set out after the below table. Additional risks not known to us, or currently believed not to be material, could later turn out to have a material impact on our business, revenue, assets, liquidity, capital resources or net income. NX Filtration's risk appetite may evolve in response to societal developments,

geopolitical shifts, the competitive and customer landscape, and internal changes. NX Filtration's

risk appetite provides an indicative bandwidth that guides decision-making processes across the organization. This bandwidth is defined for each of the following risk areas: Strategic, Operational, Financial, and Compliance. The width of the bandwidth and its position on the risk spectrum, from risk averse (low appetite) to risk taking (high appetite), vary by risk area. For instance, NX Filtration adopts a risk-averse approach to compliance risks, while the bandwidth for strategic risks is significantly

broader, enabling a higher degree of risk-taking in pursuit of strategic objectives.

Risk category Risk description Risk appetite Likelihood Potential impact

We are dependent upon acceptance of our technology by customers and

that is not covered by intellectual

Strategic

future partners. A lack thereof will likely impact our ability to achieve and maintain market acceptance.

Unsuccessful pilot projects or inconsistent performance of our products could harm the customer support for our products.

The demand for NX Filtration's products depends on the continuation of market trends towards greater sustainability, including trends to lowering the corporate water footprint and decarbonisation. Such trends could change due to a number of factors outside our control, following which the demand for our products could be reduced.

Increased competition in the water treatment solution market may materially adversely affect our ability to gain market share.

Our business and strategy depends, in part, on significant customers and our relationship with OEMs. If such relationships fail to develop this could

have a materially adverse effect on our business.

High Medium High

Medium Medium High

High Low Medium

High Medium Medium

High Medium High

Financial

could have a material adverse effect on our business, financial condition or results of operations.

Material misstatements in financial reporting may adversely impact our business, reputation and access to capital.

We are exposed to credit risk, and failure by customers or counterparties to meet their payment obligations could materially and adversely affect our financial position, liquidity and results of operations.

40 NX Filtration - Annual Report Risks and Uncertainties 41

Risk category Risk description Risk appetite Likelihood Potential impact

If our new manufacturing facility were

For information about NX Filtration's credit risk, liquidity and market risks as well as the

Filtration is unable to obtain the necessary approvals, it is unlikely to keep existing

Operational

Compliance

to become inoperable, we would be unable to produce sufficient products and our business would be harmed.

We are dependent on third-party suppliers to deliver raw materials and components for our products. Supply interruptions could lead to interruptions of our own production, increased costs, order cancellations and loss of market share.

Significant increases in the cost of raw materials, components and finished goods may materially adversely affect our business.

We depend on the ability to hire and retain management, key employees and other qualified and skilled employees and we may not be able to attract and retain such personnel.

Disruptions of our information technology systems could have a material adverse effect on our business.

Our current operations are international in scope, and we plan further geographic expansion, creating a variety of operational challenges.

We are exposed to risks associated with product liability, warranties, recall claims or other lawsuits or claims that may be brought against us.

We are subject to various laws and regulations in multiple jurisdictions in which we operate, and unfavorable changes or failure by us to comply with these regulations could have

a material adverse effect on our business.

Low Low High

Low Medium High

Medium Medium Low

Medium Medium Medium

Low Medium High

High Medium Low

Low Low Medium

Low Medium Medium

capital management structure, please refer to the information outlined in Note 3 and 4 of the Consolidated Financial Statements.

For each risk factor, we set out how we believe we mitigate these risks. However, we may not be successful in deploying some or all of these mitigating actions effectively. If circumstances occur or are not sufficiently mitigated, our business, financial condition, results of operations and prospects could be material adversely affected. In addition, risks

and uncertainties could cause actual results to vary from those described, which may include forward-looking statements, or could impact our ability to meet our objectives or be detrimental to our financial condition or reputation.

Strategic Risks

We are dependent upon acceptance of our new technology by customers and future partners. A lack thereof will likely impact our ability to achieve and maintain market acceptance.

NX Filtration's ability to succeed is mainly dependent upon achieving and maintaining the acceptance by customers and future partners of its innovative inside-out hollow fiber HFNF membranes that are based on patented technology and production methods. Historically, governments, municipal and industrial companies have fully relied on water filtration activities using conventional water

treatment technology. In order for NX Filtration to achieve its business objectives, it must convince these governments and companies that its technology and capabilities justify

the switch to its products. If NX Filtration, together with its (OEM) partners, cannot convince governments and companies of the effectiveness of its HFNF membranes or if NX

customers or attract additional customers and future partners on acceptable terms or to develop a sustainable, profitable business.

The market for HFNF is still at a relatively early stage of operation and customers may not recognise the need for, or the benefits of, the HFNF products. Therefore, the extent to which the HFNF products will be able to

meet its customers' requirements and achieve significant market acceptance is uncertain.

By contrast, the markets for UF, traditional nanofiltration and reverse osmosis treatment technologies are large and well established, which may make the commercialisation of new water treatment technologies longer than foreseen and ultimately unsuccessful, including HFNF membrane technology or other future technology developments.

The use of a new type of water filtration depends on compatibility with existing infrastructures, installations and equipment, as well as the manner in which such technique

may be used by a manufacturer. Manufacturers may elect not to use, distribute or install NX Filtration's products due to regulatory and political considerations, including but not limited to tax exemptions, subsidies, trade barriers, handling and safety requirements,

and for a variety of other reasons, including

(i) product and process safety considerations;

(ii) advantages of alternative water filtration methods; (iii) lack of cost-effectiveness; (iv) timing of market introduction of competitive products; (v) process economics in realising economies of scale; (vi) incompatibility with required product specifications; (vii) lack of fit with existing infrastructure; and (viii) the fact that NX Filtration is in an early stage of

operation and potential uncertainty around its future development and ability to deliver its products in the future.

42 NX Filtration - Annual Report Risks and Uncertainties 43

If NX Filtration fails to achieve a broad market acceptance for its products to replace or compete with current UF, traditional nanofiltration and reverse osmosis treatment technologies or if NX Filtration is not able to successfully commercialise the membrane technology that it develops, NX Filtration may not be able to generate significant revenue, which could have a material adverse effect

on its business, financial condition, results of operations and prospects.

To mitigate this risk, NX Filtration is actively developing, piloting and investing in its technology. NX Filtration benefits from a unique team of leading membrane technology experts with technical, operational and commercial experience with an extensive background in membrane technology and the water sector. Based on the concept of its pilot-based roll-out model, NX Filtration invests in significantly expanding the number and size of its pilot systems to accelerate acceptance of its technology. Furthermore, it is expected that this risk is reducing over time, as the market for HFNF is expected to gradually mature and NX Filtration's customers are gaining more experience with HFNF products, including business case development, internal approval procedures and project management.

Unsuccessful pilot projects or inconsistent performance of our products could harm the customer support for our products.

Currently, in relation to its new HFNF technology, the vast majority of NX Filtration's projects are at a pilot system phase during which customers test the HFNF technology before making a decision whether to proceed with a demo or full-scale installation investment. Some or all of such pilot

systems may not ultimately lead to full-scale installations, including for reasons beyond NX Filtration's control, such as where third parties would not adequately integrate the products into a pilot, demo or full-scale system. Its

products may not be functional, may be faulty or may not meet customers' expectations. This may lead to requirements for NX Filtration to repair or improve its products after sale and/ or installation, which may diminish operating margins or lead to actual losses. In respect

of water filtration systems that are built together with OEMs, NX Filtration may be made responsible if such systems are faulty or not functional. Furthermore, there could be unwillingness by OEMs to roll-out NX Filtration's technology across their customer

base if its products do not display the promised performance. Any of the above events could materially adversely affect NX Filtration's business, financial condition, results of operations and prospects.

To mitigate this risk, NX Filtration generally offers on-site commissioning, technical support and training by its engineers. NX Filtration seeks to maintain a constructive dialogue with the customer that is testing NX Filtration's technology through a pilot system. NX Filtration believes the vast majority of ongoing pilots have a clear visibility towards follow-on demo or full-scale projects and, the amount of customers that have not been retained after using NX Filtration's technology by way of a pilot system is considered to be limited.

The demand for NX Filtration's products depends on the continuation of market trends towards greater sustainability, including trends to lowering the corporate water footprint and decarbonisation. Such trends could change due to a number of factors outside our control, following which the demand for our products could be reduced.

The present and projected demand for NX Filtration's products is driven by the need to address global and structural water scarcity and water quality issues. Such issues include, but are not limited to, people not having daily access to clean, drinkable water, the fact that

approximately 80% of global wastewater flows back in nature without being treated, the fact that approximately 95% of medicine waste reaches nature through sewerage systems, limited reuse of treated wastewater globally, and micro-plastics ending up in any water environment and eventually the food- and waterchain. Additionally, pollution is a major concern in many emerging countries due to

the lack of adequate wastewater treatment facilities where wastewater is discharged untreated, directly into the sea or rivers. The key drivers of demand for NX Filtration's products include climate change/droughts, regulations, universal access to clean water, corporate responsibility, discharge surcharges, and health awareness.

Furthermore, water plays an integral part in the production process of companies in a wide variety of sectors, such as within the

agricultural, food and beverage, textile, power generation, mining, high tech, datacenter, semiconductor, and pulp and paper sectors. Such sectors heavily depend on water that is used as an ingredient or for operational purposes such as for cleaning, heating, cooling and transport. Many companies are reliant on water supply and exposed to the risk of water scarcity through their supply chains, since they rely on (hydropower) energy and input from water-dependent agricultural and industrial sectors.

Companies are becoming increasingly aware of the severity of water scarcity issues and its eventual impact on their businesses and seek to strategically address these by setting goals to reduce their corporate water footprint (i.e. the total volume of water that is used directly or indirectly to run and support a business).

Increasingly, customers are demanding the use of products and technologies that contribute to decarbonisation and governments globally and locally are enacting pro-climate environmental standards and regulations.

These current and expected trends could change due to a number of factors which are outside of the NX Filtration's control, including the modification or elimination of economic incentives encouraging decarbonisation, the use of alternative forms of water treatment and the public perception moving away from the idea that CO2emissions negatively impact the environment. If any of these or other changes were to occur, demand for NX Filtration's products could be reduced significantly, which could, in turn, have a material adverse effect

on its business, financial condition, results of operations and prospects.

To mitigate this risk, NX Filtration continuously monitors trends and initiates R&D efforts accordingly. To verify its R&D and product development projects, NX Filtration actively engages with its customers, academic partners and stakeholders that are active in the global water market to anticipate trends and market developments and to provide it with a deep understanding of the (future) needs of NX Filtration's customers.

Increased competition in the water treatment solution market may materially adversely affect our ability to gain market share.

The water treatment solution market is highly competitive, and NX Filtration faces

significant competition from large international competitors as well as smaller regional competitors in certain markets. NX Filtration faces competition in countries across the globe and the products of NX Filtration's competitors are typically sold globally. NX Filtration primarily competes with organisations that offer conventional water treatment solutions (such as reverse osmosis, adsorption and oxidation processes), organisations that develop products similar to those offered by NX Filtration and organisations that offer alternative technologies. NX Filtration's competitors generally have global distribution

44 NX Filtration - Annual Report Risks and Uncertainties 45

networks, a global sales force and have therefore already achieved economies of scale, as opposed to NX Filtration. In addition,

industry players that do not currently compete with NX Filtration but may have greater financial resources, may enter the market and disrupt the competitive environment, which may influence NX Filtration's ability to grow its market share. Such existing or new industry players may have longer operating histories, customer incumbency advantages, stronger relationships with industrial companies,

more access to and influence on municipal governments and more capital resources than NX Filtration does.

NX Filtration competes primarily on the basis of, among other things, price, product technology and performance, delivery times, ease of operation, sustainability benefits, flexibility, design and innovation, reputation,

brand recognition and customer access as well as the scope and quality of the products and the suitability of the products as components in systems built by original equipment manufacturers (OEMs). NX Filtration's ability to compete may be adversely affected by a number of factors, such as the following (i) new products or product improvements by competitors, including product substitution

of NX Filtration's products for new or alternative technologies; (ii) greater financial and technical resources available to other competitors specialising in water treatment;

(iii) larger players in the industry investing in research and development relating to hollow fiber nanofiltration (HFNF), ultrafiltration (UF) or microfiltration (MF) technology; (iv)

competitors having lower production costs (due to geographic location, currency fluctuations

or other advantages), larger production and assembly capacity or larger spending

budgets, more buying power with respect to raw materials, which may enable competitors to compete more aggressively in offering discounts and lowering prices; (v) consolidation

among competitors in the water treatment industry; (vi) raw material suppliers seeking opportunities to forward integrate membrane spinning capabilities; and (vii) competitors temporarily offering their products and services at significant discounts in order to enter the market or to increase their market share, thereby impacting profitability throughout the sector. If NX Filtration is unable to compete successfully for any of the above reasons,

its business, financial condition, results of operations and prospects could be materially adversely affected.

To mitigate this risk, NX Filtration is fully committed to leverage on the competitive edge of its HFNF products versus conventional water treatment solutions. Key characteristics of the HFNF product are lower energy usage, avoidance of pre-treatment chemicals, simpler system set-up with a smaller physical footprint and reduced cleaning and maintenance cost.

As a consequence of expected future cost savings, the price NX Filtration can charge for its membrane modules is significantly

higher than the price of alternative membrane modules. Furthermore, NX Filtration believes it will experience limited price pressure as

its pricing strategy is based on total cost of ownership (TCO) comparisons with alternative technologies that are well-advanced on their cost curve (i.e. these technologies have been existing for several decades and are being produced and delivered by large global players).

Furthermore, NX Filtration continuously invests in innovation, operations and its organisation amongst other to further improve performance of its products and to further reduce its

costs. In addition , NX Filtration is building its global sales and distribution network along its geographical market groups. This network allows NX Filtration to quickly roll-out its innovative product on a global scale.

Our business and strategy depends, in part, on significant customers and our relationship with OEMs. If such

relationships fail to develop this could have a materially adverse effect on our business.

NX Filtration's business and strategy depends, in part, on significant customers and its relationship with OEMs, which have the potential to roll-out the NX Filtration's technology across their customer base.

Generally, NX Filtration would have to cooperate with a third party to integrate its products in a system or installation. If the OEMs are unable to adequately integrate NX Filtration's product into their system design such roll-out may materially adversely affect NX Filtration's commercialisation efforts.

Although NX Filtration seeks to penetrate a market in which a wide and diversified number of companies could become customers, in any particular period and most notably within

the current early-stage of NX Filtration, a substantial amount of NX Filtration's revenue from sale of goods currently comes from

and in the coming years could come from a relatively small number of customers and the impact of such customer concentration is unpredictable. While NX Filtration's initial commercial model is based on pilot systems,

which allow prospective customers to test NX Filtration's technology for their application, NX Filtration has successfully converted and aims to convert these pilot systems into full-scale installations. NX Filtration may not be successful in converting all pilot systems into full-scale installations or, once installed, win repeat projects from such end-customers or may only be able to do so on less favourable

terms. If NX Filtration is unable to win, renew or extend such contracts on favourable terms, it could have a negative impact on NX Filtration's revenue and profits or NX Filtration's ability

to realise its business objectives. More generally, NX Filtration's inability to maintain relationships with key customers or OEMs could have a negative impact on NX Filtration' sales

and profits. Failure by NX Filtration to win, renew or extend larger customer contracts could have a material adverse effect on NX Filtration's business, financial condition, results of operations and prospects.

To mitigate this risk, NX Filtration seeks to build strong relationships with OEMs while applying certain standards, policies

and practices under which its engineers are expected to operate. Together with the OEMs, NX Filtration is continuously reviewing potential areas of improvement, and ensuring thorough evaluations of all incidents and sharing resulting improvements and best practices.

NX Filtration seeks to grow its relationships with OEM customers, mainly by the efforts of its commercial staff that targets and trains OEM customers to use HFNF technology in their projects. Once these OEM customers have been trained and have worked with NX Filtration's products, they can become an important element in the further commercial roll-out of NX Filtration's products. A key strategic advantage of NX Filtration is that

it does not provide filtration systems and installations itself and, as such, is regarded as an independent supplier of membrane modules that can work with multiple OEM companies without creating channel conflicts. NX Filtration develops joint business plans with key OEMs that include customer service objectives and NX Filtration regularly monitors progress to improve customer performance and enhance our customer relationships.

We do business with municipal clients and, as a result, we face risks of delays related to the procurement process, budget decisions driven by statutory and regulatory determinations and

compliance with government contracting requirements.

Doing business with public sector customers presents a variety of risks. The procurement process for municipal governments and their

46 NX Filtration - Annual Report Risks and Uncertainties 47

agencies can be highly competitive, expensive and time-consuming, often requiring significant upfront time and expense without any assurance that these efforts will generate a sale. In addition, demand for NX Filtration's products may be adversely impacted by public sector budgetary cycles and funding availability that, in any given fiscal cycle, may be reduced or delayed or not provided at all.

Public sector customers may also have contractual, statutory, or regulatory rights to terminate existing contracts with NX Filtration for convenience or due to a default, and any such termination may adversely affect NX Filtration's future results of operations. If a contract is terminated due to a default, NX Filtration may be liable for excess costs incurred by the customer for procuring alternative products or services or be precluded from doing further business with government entities. Further, entities providing services to governments are required to comply with a variety of complex laws, regulations, and contractual provisions relating to the formation, administration or performance of government contracts that give public sector customers substantial rights and remedies, many of which are not typically found in commercial contracts. These may include rights with respect to price protection, the accuracy of information provided to the government, contractor compliance with supplier diversity policies and other terms that are particular to government contracts, such as termination rights. NX Filtration's non-compliance with such terms could result in repercussions with respect to contractual and customer satisfaction issues.

To mitigate this risk, management and relevant internal stakeholders including the departments for sales, sales engineering and operations make a thorough assessment of the likelihood that efforts for municipal clients will result in a sale. The general rule is that a procurement process for municipal clients is only commenced after a satisfactory outcome of such an assessment. Furthermore, NX Filtration is continuously diversifying its customer base and the sectors it currently operates in.

Our failure to protect intellectual property rights may undermine our competitive position, and litigation to protect our intellectual property rights may be costly, time consuming and distracting from daily operations.

Intellectual property rights are vital to NX Filtration's business. Although NX Filtration has taken many protective measures to protect its technologies and know-how, including patents, trade secrets, employee and third-party nondisclosure agreements, trademarks, copyright, limited access, segregation of knowledge (including on the particular set-up of the supply-chain and

48 NX Filtration - Annual Report Risks and Uncertainties 49

production process), password protections and other measures, policing the unauthorised use of proprietary technology can be difficult, time-consuming and expensive. Also, litigation may be necessary to enforce NX Filtration's intellectual property rights, protect its trade secrets or determine the validity and scope of the proprietary rights of others. Such litigation may result in NX Filtration's intellectual property rights being challenged, limited in scope or declared invalid or unenforceable. NX Filtration cannot be certain that the outcome of any litigation will be in its favor, and an adverse determination in any such litigation

could impair its intellectual property rights and may harm NX Filtration's business, prospects and reputation.

NX Filtration inter alia relies on (i) multiple patents relating to NX Filtration's HFNF technology, (ii) trade secrets and trademark rights, and (iii) non-disclosure, confidentiality and other types of contractual restrictions to establish, maintain and enforce its intellectual property and proprietary rights. However,

the rights of NX Filtration under these laws and agreements may not fully protect NX Filtration, and the actions NX Filtration takes to establish, maintain and enforce

its intellectual property rights may not be adequate. For example, NX Filtration's trade secrets and other confidential information could be disclosed in an unauthorised manner to third parties, NX Filtration's owned or licensed intellectual property rights could be challenged, invalidated, circumvented, infringed or misappropriated or the intellectual property rights of NX Filtration may not be sufficient to provide it with a competitive advantage. Any successful challenge to any of NX Filtration's intellectual property rights could deprive

NX Filtration of rights necessary for the successful commercialisation of its products or any technology relating thereto (including the HFNF technology). Patent prosecution process is expensive and time consuming, and

NX Filtration may not file and prosecute all necessary or desirable patent applications at a reasonable cost or in a timely manner or in all jurisdictions where protection may be

commercially advantageous. It is also possible that NX Filtration fails to identify patentable aspects of its research and development output before it is too late to obtain patent protection. In addition, the laws of some countries do not protect proprietary rights as fully as Dutch law does. As a result, NX Filtration may not be able to protect its proprietary rights adequately abroad. Furthermore, intellectual property rights can be limited in time. Each of NX Filtration's current patents provide protection against infringement of the technology patented by such patent for 20 years after the filing date of the respective patent application with the relevant patent office. Any of the above, individually or in aggregate, could have

a material adverse effect on NX Filtration's business, financial condition, results of operation or prospects.

To mitigate this risk, NX Filtration regularly monitors the market and takes steps, when appropriate, to ensure compliance with its intellectual property rights which may include various intellectual property related audits. In addition, control and governance frameworks are in place to establish, maintain and protect NX Filtration's intellectual property rights and minimize the risk of data leakage as

far as possible. Furthermore, NX Filtration has developed all its critical production processes in-house based on the extensive industry experience of its team of experts. NX Filtration benefits from a strong team of leading membrane technology experts with technical, operational and commercial experience with an extensive background in membrane development, production

and commercialisation. This team has been instrumental in developing the HFNF technology, bringing this from lab-scale to industrial-scale, developing the required

innovative and patented production methods and processes and reliably producing the HFNF membranes and modules.

We may be unsuccessful in adequately protecting our technological know-how that is not covered by intellectual property registration.

NX Filtration relies on technology, know-how, and business and trade secrets, some of which NX Filtration believes cannot be adequately protected through registered intellectual property rights. Consequently, there is a risk that third parties, in particular competitors, may copy such technology and know-how or develop it independently and later challenge NX Filtration's use of it, especially considering that technology is constantly evolving and that NX Filtration's competitors are engaged in significant research and development work on products that are aimed at competing with

NX Filtration's products. In addition, employees who, in the course of their employment with NX Filtration, have access to important proprietary information which may or may not be protected by intellectual property rights may leave to go work for a competitor.

To mitigate this risk, NX Filtration relies on confidentiality agreements with suppliers and customers, noncompete clauses in contracts with employees and technical precautions to protect its technology, knowhow and other proprietary information. Furthermore, we apply compartmentation in our processes. For different parts of our production process and equipment we make sure that no individual supplier or employee has a full picture of the total manufacturing process. However, there is no guarantee that these agreements and

precautions or NX Filtration's ability to enforce its contractual rights, will provide sufficient protection in the case of any unauthorised access or use, misappropriation or disclosure of such information. Defending against any unauthorised access or use, misappropriation

or disclosure of NX Filtration's technology, knowhow, and other proprietary information may result in lengthy and costly litigation or administrative proceedings and may cause significant disruption to the business and operations of NX Filtration. If NX Filtration is unable to protect or effectively enforce its proprietary technology and information, this could have a material adverse effect on NX

Filtration's business, financial condition, results of operations and prospects.

New products or technological improvements by competitors, including by larger players in the industry investing in research and development for product substitution of our HFNF products, or improvements to our HFNF technology could materially adversely affect our business and our ability to gain market share.

Disruptive changes in technology and product standards could render NX Filtration's products less competitive, or even obsolete. Other companies that seek to enhance traditional technologies have recently introduced or

are currently developing products based on emerging and potential technologies. These competitors are engaged in significant research and development work on products that

may be similar to NX Filtration's products. New products could be introduced that are in direct competition with, or superior to, NX

Filtration's products. Competing technologies that outperform NX Filtration's technology could be developed and successfully introduced and, as a result, NX Filtration's existing or future products may not be able to compete effectively in its current or future target markets. If NX Filtration's technology is not adopted by its customers, or if its technology does not meet industry requirements, NX Filtration's existing or future products may

not gain or maintain market acceptance. If NX Filtration cannot adapt to changing market conditions should customer behaviour change,

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or if NX Filtration fails to develop, manufacture and market products that improve upon existing technologies, its business, financial condition, results of operations and prospects could be materially adversely affected.

To mitigate this risk, NX Filtration continues to significantly invest in R&D to remain competitive. NX Filtration monitors and analyses competitors through various sources such as trade associations, universities, banks, employees and their intellectual property filings, and it actively maintains, protects and expands its own intellectual property portfolio. As a result of the limited innovation that has taken place by competitors, conventional technologies are not always equipped to cope with the challenges and demands of today's environment. NX Filtration believes its HFNF product

provides a number of advantages over these technologies, including but not limited to (i) superior filtration characteristics and performance; (ii) sustainability benefits throughout the lifetime of the product, as it typically reduces energy consumption and avoids the use of pre-treatment chemicals; and (iii) reduced physical footprint, as it typically reduces the number of treatment steps.

Furthermore, NX Filtration's products are developed and produced in-house, which makes NX Filtration less vulnerable to new market developments, resulting in short innovation cycles, cross leverage of concepts, modularity of modules and short time to market.

Financial Risks

We may need additional financing in the near future, and such financing may not be available on favorable terms, or at all.

Given the slower than anticipated sales growth, the Company may need additional financing in the future for general corporate purposes, and to implement its growth strategy for the longer-term. At such time, we may be unable to obtain desired additional financing on favorable terms or at all, including accessing the capital markets when it may be necessary or beneficial to do so, which could negatively impact our flexibility to react to changing economic and business conditions. For example, during periods when credit markets are volatile, lenders may fail or refuse to provide capital. If adequate funds are not available on acceptable

terms, we may be unable to fund growth opportunities, successfully develop or enhance products, or respond to competitive pressures, any of which could negatively affect our business, financial condition and results of operation.

52 NX Filtration - Annual Report Risks and Uncertainties 53

We are fully cognizant of the risks associated with our current reliance on cash reserves and we have implemented proactive measures

to address these concerns. To mitigate the identified risks, we have (i) secured equity and debt funding in excess of € 50 million in April 2024 (of which approximately € 28.5 million

is still available at 31 December 2025), (ii) developed a comprehensive revenue generation strategy aimed at diversifying income streams, and (iii) we have implemented robust cost management measures to optimize operational efficiency and ensure prudent use of available resources. The financial year 2025 was also

a transition year in terms of cost and Capex reduction. We completed the transfer of all our activities to our new factory and launched various efficiency programs. We also narrowly focused our research and design activities,

to further cement our broad and competitive portfolio across all three product ranges. These efforts have already resulted in lower operating costs in 2025, in conjunction with further business growth. Also with regards to Capex, we are fully invested in our new factory, with 2025 Capex more than 75% lower than 2024, and further reductions expected for 2026. We continue to proactively align our cost levels to the timing of realizing our growth, therewith controlling our path towards break-even operations in the medium term.

We may be exposed to the risk of fraud and other dishonest activities, which could have a material adverse effect on our business, financial condition or results of operations.

As a company with a limited revenue base and ambitious growth targets, we may face

pressure to achieve certain revenue milestones within specific reporting periods. Such pressure may increase the risk that employees or commercial teams enter into commercially unfavorable agreements, accelerate shipments, or engage in other practices intended to bring forward revenue, or that revenue is recognised based on incorrect assumptions or in a manner inconsistent with IFRS.

We have implemented a set of internal control measures and compliance policies, including amongst others, an authorization policy, sufficient level of segregation of duties, approval of bank payments, reporting and monitoring framework, also to ensure that revenue is recognised only when the relevant accounting criteria are met and that commercial decisions remain aligned with the Group's long-term interests. We believe this is appropriate for NX Filtration. Considering the size and concentrated locations of NX Filtration, the existing internal control and reporting framework, we believe all material events are timely known to the Management Board and enable us to take appropriate

actions. However, the risk of fraudulent or other dishonest activities occurring and affecting

NX Filtration cannot be excluded. Further, as NX Filtration grows or expands in international markets, its internal controls may need to be adapted in order to effectively prevent and detect fraud and other dishonest activities.

However, there can be no assurance that NX Filtration will be able to adapt such internal controls in a timely manner or at all or that they will be effective. Any fraud incident or dishonest activity affecting NX Filtration, whether as a result of the activities of employees, partners, suppliers or other third parties, may result in financial losses, a loss of customer trust and confidence, as well as litigation or financial or other regulatory penalties being imposed, any of which could have a material adverse effect on NX Filtration's business, financial condition or results of operations.

We furthermore enforce a comprehensive code of conduct that outlines expected behavior and ethical standards for all employees.

We promote a culture of integrity and transparency, making it clear that fraudulent activities will not be tolerated. As part of

our regularly held business meetings, senior management reviews financial statements, reports, and key performance indicators.

This oversight helps identify anomalies or inconsistencies that may indicate fraudulent activities. Our financial department continuously monitors systems to detect unusual patterns or behaviors in financial transactions. We conducted an updated formal fraud risk assessment in 2025. The formal fraud risk management programme fits our ambitions to grow to a set of defined or managed internal control measures to mitigate fraud risks.

Material misstatements in our financial reporting may adversely impact our business, reputation and access to capital. We publish our financial results on a semi-annual basis in accordance with IFRS. Accuracy, consistency and completeness of these disclosures are essential for maintaining the confidence of shareholders, the lender

of our debt financing, customers and other stakeholders. Any material misstatements, omissions or inconsistencies in our financial reporting could lead to regulatory scrutiny, loss of market confidence, reputational damage,

or challenges in obtaining future financing. Given our conservative risk appetite in this area, we have implemented a robust internal control framework designed to ensure that all reporting entities apply uniform standards and produce reliable financial information in line with applicable accounting and reporting principles. These controls include, among others, standardized reporting instructions, periodic reviews of accounting judgments, segregation of duties within the finance

function, and oversight mechanisms at both the Management Board and the Supervisory Board.

We are exposed to credit risk, and failure by customers or counterparties to meet their payment obligations could materially and adversely affect our financial position, liquidity and results of operations.

We are subject to credit risk arising primarily from trade receivables. A significant portion of our revenue is generated from sales

to customers that may themselves be exposed to financial, operational or market pressures. Any deterioration in a customer's financial condition, delays in project execution, contractual disputes, or broader macroeconomic weakness may impair a customer's ability or willingness to meet its payment obligations when due.

If customers delay payments, seek to renegotiate terms, or fail to pay altogether, we may experience increased overdue receivables, higher impairment charges, and reduced operating cash flows. Given the current size

of our company this could have a relatively high impact. We may also incur additional administrative or legal costs to enforce contractual rights or to recover overdue amounts, with no assurance of success.

Concentration of revenues among certain customers could further amplify the impact of non-payment by any individual counterparty.

We seek to manage credit risk by performing upfront credit assessments as we make use of information from licensed credit agencies. We also set customer-specific credit limits, monitoring overdue receivables on an ongoing basis, and applying provisioning guidelines consistent with IFRS. Where appropriate, we may require advance payments, stage-based invoicing, letters of credit, bank guarantees, or other security arrangements such as

credit insurances to reduce exposure. We also maintain internal escalation procedures for disputed or overdue balances and regularly reviews its credit-risk exposures at Management Board level.

54 NX Filtration - Annual Report Risks and Uncertainties 55

Operational Risks

If our new manufacturing facility were to become inoperable, we would be unable to produce sufficient products and our business would be harmed.

The new manufacturing facility could expose NX Filtration to product comparability issues meaning that the products could not immediately have similar quality attributes before and after the manufacturing

process changes. That may further delay the introduction of additional capacity to

manufacture its products, as the facility and the equipment that will be used to manufacture its products will be costly to install and could require substantial lead time to install and qualify for use. The new manufacturing facility may not provide NX Filtration with all of the operational and financial benefits it expects to receive. Furthermore, the costs of complying with environmental laws and regulations

and any claims concerning noncompliance, or liability with respect to contamination in the future, could have a material adverse effect on NX Filtration's business, financial condition, results of operations and prospects.

To mitigate this risk, NX Filtration has an extensive expansion and implementation roadmap in place for further increasing production capacity going forward. The construction plans are based on a highly modular concept that foresee a gradual scale-up of production capacity based on existing blueprints of key process steps, including NX Filtration's spinning line for the production of its membranes.

We are dependent on third-party suppliers to deliver raw materials and components for our products. Supply interruptions could lead to interruptions of our own production, increased costs, order cancellations and loss of market share.

NX Filtration's production process depends on the availability, quality and timely supply of raw materials, components and finished

goods from third-party suppliers. NX Filtration obtains a significant portion of its processed raw materials from a few key suppliers. With respect to a few raw materials and/or the processing thereof, NX Filtration has sourced and may in the future source from one of these suppliers or other single suppliers from time to time due to specific quality or other requirements or because the small volumes required may not justify the cost of sourcing from multiple suppliers or other suppliers

may not be available to provide necessary quantities. If any of NX Filtration's suppliers is unable to meet its obligations under purchase orders or supply agreements, including due

to their own production capacity limitations or otherwise limited supply of materials as a result of their obligations to other customers,

or does not deliver the quality that is necessary to meet the raw material standards applied by NX Filtration, NX Filtration may be forced to pay higher prices to obtain the necessary raw materials from other suppliers, may be faced with increased lead times, may need to change suppliers, or may not be able to locate suitable alternatives at all. Changing suppliers can be time-consuming and costly, as resources are required to qualify new suppliers and ensure the quality, approval and consistency of the raw materials. Supply interruption could

lead to interruption of NX Filtration's own production at one or more production facilities. Furthermore, if NX Filtration experiences significant increased demand for its products, there can be no assurance that additional supplies of raw materials, components and finished goods will be available when required

on terms that are acceptable to NX Filtration, or at all, or that any supplier would allocate sufficient supplies to NX Filtration in order

to meet its requirements or fill its orders in a timely manner.

NX Filtration may experience supply problems in the future or be unable to extend current or enter into new supply agreements, especially agreements for raw materials with relatively low volume requirements, where NX Filtration's negotiating power is limited. If NX Filtration fails to maintain its relationships with current suppliers, if suppliers offer pricing and

other terms that are not satisfactory, or if a supplier fails to supply raw materials that

meet NX Filtration's quality, quantity and cost requirements, NX Filtration may be unable

to fill customers' orders on a timely and cost-effective basis or in the required quantities, which could result in production disruptions, damage claims, order cancellations, decreased sales or loss of market share and damage to NX Filtration's reputation. These factors could, in turn, have a material adverse effect on NX Filtration's business, financial condition, results of operations and prospects.

To mitigate this risk, NX Filtration always seeks to have multiple interchangeable suppliers

for its key purchases. For its standardised commodity raw materials and parts suppliers, NX Filtration has a multiple supplier strategy in place in order to ensure continuous operations. NX Filtration is in continuous dialogue with its key suppliers to discuss potential supply chain challenges and, in case of any disruptions, seeks to jointly address these and return to normal course of business as quickly as possible. Any potential disruptions can further be mitigated by, temporarily, increasing stock levels and adjusting working procedures.

Significant increases in the cost of raw materials, components and finished goods may materially adversely affect our business.

NX Filtration uses various raw materials, components and finished goods in its operations, including polymers such as polyethersulfone, polyvinyl chloride (PVC) and epoxy. The prices for these raw materials, components and finished goods fluctuate depending on market conditions and global demand for these materials and could adversely affect NX Filtration's business and operating results. In recent years, PVC

in particular experienced a significant price increase, largely attributable to persistent supply-side issues globally. NX Filtration's ability to achieve profitability is, and will continue to be, dependent in part upon its ability to reduce production costs and costs of materials required to make these products (including raw materials As a consequence, sudden and significant

increases in the prices of raw materials or similar volatility with respect to the currency exchange rates between the euro and the currency of

such goods may lead to corresponding price increases in components and finished goods used in the assembly of NX Filtration's products. NX Filtration is also indirectly exposed to fluctuations of labour costs, commodity prices and energy costs as the prices of raw materials and components it orders from third-party suppliers and manufacturers will likely increase if the costs of NX Filtration's suppliers increase. NX Filtration does not hedge the price exposure for its raw materials. Increases in the costs of raw materials and components and as a result in finished goods may therefore have a material adverse effect on NX Filtration's business, financial condition, results of operations and

prospects, particularly because it is generally not able to pass on such price increases or reduce other costs to offset the higher commodity prices. Furthermore, the price of commodities could become so high that there is a decline in the demand of the products provided by NX Filtration.

56 NX Filtration - Annual Report Risks and Uncertainties 57

To mitigate this risk, NX Filtration always seeks to have multiple interchangeable suppliers for its key purchases, also from a cost perspective. For its standardised commodity raw materials and parts suppliers, NX Filtration has a multiple supplier strategy in place in order to ensure continuous operations. Furthermore, NX Filtration's pricing strategy is based on TCO comparisons with alternative technologies that are likely impacted by similar raw material price increases as NX Filtration may be exposed to, and developments in raw material prices are monitored and where possible addressed through a pro-active pricing strategy.

We depend on the ability to hire and retain management, key employees and other qualified and skilled employees and we may not be able to attract and retain such personnel.

NX Filtration's future performance and its ability to reach its strategic objectives depends in significant part on the continued service of the senior management of the Company and other key personnel, including employees involved in research and development, operations, marketing and sales personnel and employees with critical know-how and expertise. Other than customary notice periods, none of NX Filtration's key employees

is required to stay for any specific term. In addition, NX Filtration does not have "key person" life insurance policies covering any of its officers or other key employees. The loss of the services of one or more members of senior management or other key personnel, or the inability to hire (additional) members of the senior management, could disrupt its operations, delay the development and introduction of NX Filtration's products and anticipated expansion projects, which could, in turn, have a material adverse effect on NX Filtration's business, financial condition, results of operations and prospects.

NX Filtration's success also depends on its continuing ability to attract, retain and develop qualified and skilled personnel,

including financial personnel, sales personnel, scientists, designers, technical employees and engineers with the requisite technical background. Competition for such personnel is intense, in particular for technical and industrial employees, and there is significant competition for talented individuals with the specialised knowledge of water filtration and membrane technology. This is particularly relevant in the Netherlands, as the country where NX Filtration

has its headquarters, significant business operations and research and development activities. NX Filtration's efforts to retain and motivate management and key employees or attract and retain other highly qualified personnel in the future may not be successful.

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